The stay from the US District Court for the District of Massachusetts restricts CardiAQ from enforcing the money judgement “pending the outcome of the appeal,” the company said.
“Having this stay in place will allow our team to continue to advance both our Tiara and Reducer products and help patients in need. “2017 is shaping up to be an exciting time, with important clinical and development milestones expected throughout the year,” CEO Alexei Marko said in a press release.
As part of the stay, Neovasc said it will deposit $70 million into a joint escrow account and enter into a general security agreement related to remaining damages.
The company said it is “preparing to appeal the validity of the award” and the ruling on inventorship, and said the appellate process could take approximately a year to complete.
A Massachusetts federal jury in May awarded $70 million to CardiAQ after finding that Neovasc misappropriated trade secrets in developing its Tiara transcatheter mitral valve replacement device. Edwards inherited the lawsuit when it acquired CardiAQ Valve for $400 million in August 2014.
Last month, Neovasc narrowly avoided an investor lawsuit related to the loss. The $70 million ruling in May pushed NVCN shares down some -75% and prompted shareholder Sergio Grobler to file a purported class action lawsuit against Neovasc on behalf of Neovasc stock owners who bought from Neovasc’s January 2015 initial public offering to the date of the May 19 verdict. (The judge overseeing the CardiAQ Valve suit against Neovasc later added $21 million in damages for willfulness).
Neovasc moved to have the investor lawsuit dismissed, arguing that its statements that the CardiAQ Valve lawsuit was baseless and without merit were forward-looking and thus protected by the “safe harbor” created by the The Private Securities Litigation Reform Act of 1995.
Judge Richard Stearns of the U.S. District Court for Massachusetts agreed, finding that statements by Neovasc in regulatory filings, and by executives during earnings calls, were protected by the safe harbor provision.