Healthcare giant Johnson & Johnson's board of directors has agreed to the creation of a new regulatory and compliance committee to monitor oversight of compliance and quality issues, the Wall Street Journal reported Monday. However, the board reportedly decided not to pursue litigation filed by certain shareholders last year against certain company officials.

The board's decision is said to be based on the recommendations of a special committee of four independent directors that was formed last year to probe allegations made by certain shareholders against certain officers and directors of the company, including Chairman and Chief Executive Officer William Weldon.

The WSJ reported that the special committee filed a 127-page report on Monday with the U.S. District Court in Trenton, New Jersey, concluding that "it is not in the best interests of the company to pursue the derivative litigation currently pending or to initiate litigation based upon demands made upon the board by the demand shareholders."

Johnson & Johnson's board, with the exception of CEO Weldon, who reportedly did not participate, is said to have unanimously adopted the committee's recommendations at a meeting earlier Monday.

New Jersey-based Johnson & Johnson's financial performance and reputation has been hurt by a series of product recalls ranging from over-the-counter medicines to hip-replacement products, and government probes. The shareholders filed the lawsuits, accusing certain officers and directors of the company of allowing the improper activities to occur across the company's businesses in breach of their fiduciary duties to the company.

Johnson & Johnson continues to be dodged by product recalls at its McNeil Consumer Healthcare unit, which recalled one product lot of Tynelol Extra Strength Caplets 225 count bottles distributed in the U.S. The unit has recalled several over-the-counter or OTC, medicines in the past 16 months, including Tylenol, Benadryl, Motrin, Zyrtec, Sudafed, Sinutab and Rolaids. The series of product recalls that began in January 2010 has already cost the company nearly a billion in 2010.

In early April 2011, Johnson & Johnson said it will pay about $70 million to settle U.S. charges that it allegedly bribed doctors in Europe to sell products and paid kickbacks to Iraq to win contracts under the United Nations Oil for Food Program.