11:47 AM EDT, 09/04/2024 (MT Newswires) -- Johnson & Johnson ( JNJ ) was ordered Wednesday to pay over $1 billion in damages for breaching its pledge to prioritize two surgical robots it acquired when it purchased Auris Health.

Vice Chancellor Lori Will of the Court of Chancery of the State of Delaware ruled that Johnson & Johnson ( JNJ ) broke its promise to Auris that it would provide efforts and resources to achieve two commercial and eight regulatory milestones for the surgical robots -- iPlatform and Monarch -- that would fetch Auris an additional $2.35 billion as part of the acquisition deal.

Instead, the company pitted iPlatform in a head-to-head competition with its own surgical robot called Verb in a project called "Project Manhattan."

"J&J knew Project Manhattan would hinder, rather than promote, iPlatform's achievement of the regulatory milestones," Will said in her ruling. "It also knew that combining iPlatform and Verb would cause further complications. But J&J viewed the resulting delays as beneficial since it could avoid making the earnout payment."

Will ruled that Auris is entitled to damages for Johnson and Johnson's ( JNJ ) breaches of contract and of the implied covenant of good faith and fair dealing as they pertain to the iPlatform regulatory milestones. It is also entitled to damages for fraud concerning the Monarch milestone, Will said.

Neither Johnson and Johnson ( JNJ ) nor Auris immediately replied to requests for comment from MT Newswires.

Price: 167.43, Change: +0.27, Percent Change: +0.16