The lawsuit, not the 1st spat between the companies, accuses Medtronic of luring Lenox into a distribution deal to create a market for bone bone mill devices, planning to supplant Lenox’s technology via a false recall and replace it with its own Midas Rex mill.
A 3-judge panel at the 10th Circuit Court of Appeals ruled this month that Lenox had gathered sufficient evidence to support a finding on its claims that Medtronic had violated antitrust laws. The new decision reopens litigation which was closed last year after Judge Richard Matsch of the U.S. District Court for Colorado ruled that Lenox failed to make its case.
Lenox MacLaren Surgical 1st inked a distribution deal with Medtronic in 2000 for its bone mill devices, hoping the pact would provide the scale to put the products in every orthopedic surgical suite in the world, according to court documents. The deal allegedly came to naught after Medtronic only bought the 500 mills the contract called for, using a loaner program to create a thriving demand even as it worked to develop its own mill to usurp the Lenox MacLaren device, according to a lawsuit Lenox MacLaren filed in the fall of 2012.
The original lawsuit was settled in arbitration, with Lenox prevailing only on a single claim: "intentional interference with prospective business relations by the issuance of a voluntary recall of the Lenox product in October 2006, to clear it out of the marketplace and replace it with the Midas Res."
Lenox sued again after the discovery process in the 1st lawsuit revealed collusion among other Medtronic subsidiaries not named in the original suit, but the lawsuit was dismissed after a judge ruled that Lenox failed to prove that Medtronic unlawfully sought to exclude its mill from the market.
"Lenox has presented sufficient evidence to support a finding on each element of its Section 2 claim for actual monopolization: monopoly power in the relevant product market, exclusionary conduct, and harm to competition," the appeals court wrote in its latest decision. "Thus, fact questions also exist on Lenox’s claim of attempted monopolization. These disputes of material fact preclude summary judgment to Medtronic. In these circumstances, we reverse the district court’s grant of summary judgment to Medtronic and remand for further proceedings."
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