Boston Scientific (NYSE:BSX) is no stranger to the court room, and its latest quarterly release is a testament to the company’s legal tenacity.
The Massachusetts medical device company’s newest report details some highlights from its recent legal history, including an Iraqi government complaint that won’t quit, an escape from an off-label marketing lawsuit that ensnared a rival and a long-running patent spat with OrbusNeich Medical that has, so far, generated police involvement and physical seizure of medical products.
Iraq won’t back down
The Republic of Iraq isn’t prepared to let go of a 4-year-old complaint against BoSci and a raft of other plaintiffs in a lawsuit that claims BoSci’s BSSA France subsidiary and 92 other companies committed crimes connected with the sale of products under the United Nations’ Oil for Food program.
The Iraq government maintained that BoSci and others paid kickbacks to Saddam Hussein’s regime in exchange for business, claiming that Iraq’s former government reaped billions of dollars in illegal payments from global companies by inflating prices for goods and services with bogus transportation and service fees.
A New York Judge ruled in February 2013 to dismiss the complaint with prejudice "on standing and jurisdictional grounds," but the Iraq government filed an appeal shortly after, according to BoSci’s report.
The plaintiff is seeking monetary and punitive damages for its accusations of Racketeer Influenced & Corrupt Organizations Act violations, conspiracy to commit fraud, false statements and improper payments.
Whistleblower withdraws case against biliary stent marketing
in 2007 BoSci and other stent makers found themselves at the center of a high-profile investigation when federal officials, on a tip from whistleblower Kevin Colquitt, began probing biliary stent marketing for incidents of off-label promotion.
The lawsuit accused certain medical device companies "and others in the market" of pursuing a common "scheme" to illegally market their biliary stents for peripheral treatments. The accusations took an almost conspiratorial tone, with Colquitt claiming that the medical device industry "banks heavily" on the "objective fact that [the] vast majority of biliary stents are being marketed and used in an off-label fashion."
BoSci finally closed the book on that complaint earlier this month when Colquitt dropped an attempted appeal. A Texas judge had ruled earlier this year that Boston Scientific and Johnson & Johnson (NYSE:JNJ) were clear of any wrongdoing, but opted to proceed with the case against Abbott (NYSE:ABT).
The ongoing wrestling match with OrbusNeich
BoSci and OrbusNeich have been tangled up in stent patent lawsuits for years now, with recent months bringing a slew of highlights that include police involvement and the physical seizure of Boston Scientific’s devices from a facility in Germany. A German court in April granted an injunction against importing into that country versions of BoSci’s Promus Element, Promus Element Plus, Omega, Taxus Element, Synergy and Promus Premier devices.
The U.S. medical device maker has tried to fight back against the litigation with a couple claims of its own. In March 2013 BoSci and a pair of its subsidiaries filed lawsuits against Orbus in the U.K., asking an English High Court to invalidate the Orbus patents and to declare once and for all that the Element stent designs are clear of infringement.
The legal tussle with Orbus goes back at least 4 years to 2009 when Boston Scientific sued OrbusNeich Medical in Dutch courts on the grounds that OrbusNeich’s Genous stent infringed a private patent that Boston Scientific calls "the Keith patent." That complaint finally closed just last month when the Hague Court of Appeals found the Keith patent invalid, adding another tally to Orbus’ wins against BoSci.
BoSci’s latest publication provides a sort of play-by-play of the most recent volleys in the legal battle between the 2 companies. From the report:
- In February 2013, Orbus International B.V. filed suits against the company and 2 of its Dutch subsidiaries in the Hague District Court in the Netherlands and Orbus Medical GmbH filed suits against the company and 1 of its German subsidiaries in the Duesseldorf District Court in Germany.
- In 1 German matter, Orbus sought preliminary injunctive relief, which the Duesseldorf District Court granted on April 30, 2013. On that same date, we appealed the injunction to the Court of Appeals of Duesseldorf. .
- In the other German matter, Orbus is seeking damages and injunctive relief, and a hearing is scheduled for May 14, 2014.
- In March 2013, Orbus Medical Inc. and Orbus international B.V. filed suit against the company and 2 of its Irish subsidiaries in the Irish Commercial Court in Dublin, Ireland. Each of these matters alleges that the Company’s sale of stent systems using the Element design infringe European patents owned by Orbus Medical Inc. and licensed to other Orbus entities…In the Irish matter, Orbus is seeking damages and injunctive relief.
- In one Dutch matter, Orbus is seeking cross border, preliminary injunctive relief, and a hearing is scheduled for June 11, 2013.
- In the other Dutch matter, Orbus is seeking damages and injunctive relief, and a hearing is scheduled for December 20, 2013.
