The three-judge panel in Philadelphia said on Friday that Heraeus can pursue claims stemming from Esschem’s alleged use of Heraeus’ information within three years before Heraeus filed suit. The judges based their opinion on the Pennsylvania Uniform Trade Secrets Act, which allows companies that three-year window from when “the misappropriation was discovered or… should have been discovered” to bring suit. Esschem is based in Linwood, Penn.
The appeals court reversed part of a U.S. District Court for Eastern Pennsylvania summary judgment that had barred Heraeus from seeking compensation for the alleged misuse of its trade secrets during the three-year period before it sued Esschem. The appeals court judges agreed with the district court that Heraeus could not extend its claim earlier than that.
Heraeus claimed that it did not discover sufficient facts to sue Esschem until December 2011, and that its September 2014 suit fell within the three-year limitations period. Esschem has argued that Heraeus had sufficient information to state a claim against Esschem at various points between 2005 and 2010, such as in January 2009, when Heraeus brought its discovery suit against Esschem in the United States.
Hanau, Germany-based Heraeus sued Biomet in 2008, alleging that Biomet misappropriated trade secrets when developing its Refobacin and Biomet bone cements. In June 2014, a German appeals court enjoined Biomet from making or selling the cements and and leveled more than €30 million in damages (about $34.7 million at today’s exchange rate).
Both sides appealed, but in June 2016, the German Supreme Court dismissed the appeals, prompting Heraeus to restart the proceedings in December of that year to force Zimmer Biomet’s Swiss subsidiary to relinquish its CE Mark approvals for the Refobacin and Biomet cements, Zimmer Biomet said in the filing.
Hereaus’ suit against Esschem accuses Biomet of helping Esschem develop a pair of copolymers used to make cements that compete with Heraeus products, using trade secrets allegedly pilfered from the German company. Zimmer Biomet has said it agreed to indemnify Esschem for any liability with certain exceptions.