Despite three dozen objectors, a California federal judge has approved Federal Insurance Co.’s proposed $12.25 million settlement agreement, which will resolve thousands of insurance claims alleging Caldera Medical Inc.’s transvaginal mesh implant caused injuries in more than 2,700 women. Under the non-opt-out settlement, Federal Insurance agreed to distribute $10.58 million among 2,710 class member claimants and to pay class counsel $670,020 in attorneys’ fees and costs. In exchange, the claimants will release Caldera and Federal Insurance from all future claims.

U.S. Judge Stephen V. Wilson said in his order that the settlement is fair, reasonable, adequate and “consistent with due process.” The settlement brings to an end the federal interpleader suit that Federal Insurance filed against Caldera and a class of claimants in January 2015. At the time, multiple lawsuits had been filed against Caldera in California state court over its transvaginal mesh implant used to treat pelvic organ prolapse and stress urinary incontinence in women.

The suits, which were consolidated in state court, alleged that Caldera knew or should have known that the transvaginal mesh devices it manufactured and sold were hazardous and dangerous. The Plaintiffs sought damages from Caldera, which in turn filed insurance claims with Federal Insurance. Federal Insurance claimed that Caldera was depleting its $25 million policy cap by fighting the litigation in state court, and noted that it had already paid out more than $6.3 million in settlements even though there were thousands of additional claims pending.

Federal Insurance asked the court to certify a class of claimants and enjoin the claimants from pursuing further suits affecting the insurance policy. The state litigation was stayed pending the resolution of the insurance suit. In December 2015, the parties reached a settlement under which Federal Insurance would pay a $12.25 million lump sum, including a $500,000 holdout, to resolve pending claims against it and end its policy with Caldera. Under the proposed settlement, claimants could not opt out of the settlement. However, 36 women objected to the settlement in June.

The claimants are represented by Gordon W. Renneisen of Cornerstone Law Group and David Bricker of Waters Kraus & Paul. The state litigation is In Re. Transvaginal Mesh Litigation (case number JCCP 4733) in the Superior Court of the State of California for the County of Los Angeles. The instant case is Federal Insurance Co. v. Caldera Medical Inc. et al. (number 2:15-cv-00393) in the U.S. District Court for the Central District of California.


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