(AP photo/Wally Santana)

(Bloomberg) — Johnson & Johnson has persuaded the Arkansas Supreme Court to throw out a $1.2 billion award against the drugmaker over the company’s marketing of the antipsychotic drug Risperdal.

A majority of Arkansas’s highest court concluded today that state officials relied on the wrong law to challenge J&J’s Risperdal marketing campaign, and that a judge erred in setting the $1.2 billion in fines for violations of the state’s Medicaid fraud statute.

The appeals court said Arkansas officials wrongly attempted to use a law governing health-care facilities as the basis for sanctions over J&J’s allegedly misleading marketing of the medication.

The Arkansas penalty was the largest of the three handed down so far against &J in state cases alleging the second-biggest maker of health products hid Risperdal’s risks and tricked Medicaid regulators into paying more than they should have for the medicine.

The case is State of Arkansas v. Ortho-McNeil-Janssen Pharmaceuticals Inc., CV07-15345, Pulaski County Circuit Court (Little Rock) Arkansas.

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