Former Boston Scientific (NYSE:BSX) sales rep Elaine George got the green light from a Texas federal judge to pursue a lawsuit alleging that her erstwhile employer wrongly terminated her when she called attention to potential off-label marketing of cardiac ablation devices.
George maintains that the Natick, Mass.-based med-tech titan fired her in 2006 after only 3 months on the job after she voiced concerns that the company was promoting its FlexView microwave surgical devices, cleared for removal of soft tissue during surgery, as an option for treating an irregular heartbeat.
George accused Boston Scientific of "retaliatory discharge" under the False Claims Act, alleging that leadership at Guidant, which was in the process of being absorbed by the med-tech giant, reprimanded her and threatened her with discharge when she questioned its marketing practices.
After she was fired in September 2006, George claims, Boston Scientific executives had her "blacklisted" from other med-tech and health care companies.
About 2 months later, she filed a qui tam whistleblower lawsuit against Guidant and Boston Scientific on the grounds that the companies defrauded Medicare and Medicaid for millions of dollars through off-label promotion of the FlexView devices. In March 2007, she amended the complaint to include charges of wrongful termination.
George, who had spent 17 years in medical device sales when she joined Guidant, filed similar qui tam suits against St. Jude Medical (NYSE:STJ) and Medtronic (NYSE:MDT), alleging that they also improperly promoted ablation devices as therapy for atrial fibrillation – an indication that the device giants were seeking, but had not yet received, from the FDA.
St. Jude won the race to win the federal watchdog agency’s OK to use a cardiac ablation system to treat AF in February 2009.
AtriCure (NSDQ:ATRC) was also accused of off-label marketing of ablation devices, but the whistleblower in that case was not identified. The company paid $2.8 million in April 2010 to settle a class-action shareholder suit stemming from the claims, just months after paying $3.8 million to settle the matter, without admitting wrongdoing, with the U.S. Justice Dept.
George’s 2006 whistleblower lawsuit against Boston Scientific has yet to reach trial. Read more
Covidien notches a win in long-running trocar patent battle with Applied Medical
Covidien (NYSE:COV) notched a win in the ongoing patent infringement case lodged by Applied Medical Resources when a California federal court ruled that the Mansfield, Mass.-based med-tech giant’s surgical trocars do not infringe on Applied Medical’s patent.
It’s only the latest development in a welter of patent sniping between the firms. Last summer, Covidien counter-sued Applied for patent misuse, non-infringement and invalidity, 2 weeks after AMR filed its 5th lawsuit related to surgical trocars.
In May 2011, Applied sued over a re-issued trocar patent, a claim which Covidien denied in its counter-suit. In 2010 a federal judge ruled in favor of a Covidien trocar patent infringement lawsuit, costing Applied Medical $4.8 million. Read more
Imaging3 to settle with Cranshire Capital for 6.3M shares
Imaging device maker Imaging3 Inc. issued more than 6.3 million shares of common stock to Cranshire Capital to reimburse Cranshire for legal fees in a bid to dismiss a pending lawsuit.
Cranshire, which was part of Imaging3’s $1 million private placement in October 2010, sued the firm for allegedly diluting its share value with a securities purchase agreement in October 2011. Read more