Fresenius Medical Care (NYSE:FMS) wants a Colorado court to order one of its suppliers, Magnum Plastics, to cover the costs of a recall and any settlements it has to pay as a result, saying Magnum breached its contract when it produced the defective component that led to the recall.
According to the lawsuit, filed in the U.S. District Court for Colorado, Magnum discovered a flaw in the mold it used to produce a component for the Fresenius Liberty hemodialysis system.
The flaw led Fresenius to issue holds on the affected products, cassettes used in the Liberty system, during the fall of 2009. A recall followed in August 2010, according to court documents.
“Fresenius incurred significant expense in instituting the hold and recall,” according to the documents. “Fresenius has no fault whatsoever with respect to any of damages alleged to be caused by the Magnum Cassettes including any consequential or incidental damages.”
The recall led to at least one lawsuit in Ohio, according to the documents, plus other demands for settlements related to the recall.
“Fresenius seeks a declaration that Magnum Plastics is responsible for costs (including attorneys’ fees) incurred in recalling and replacing the Magnum Cassettes, defending the Ohio lawsuit and responding to demands, and bringing this action,” according to the lawsuit. “Fresenius also seeks a declaration that if it is found liable for any damages or settles any claim for damages, which liability Fresenius expressly denies, those damages were the sole, direct, and proximate result of or were directly contributed to by acts, omissions, conduct, negligence and default of Magnum Plastics.”