Stryker, which acquired the Duracon Uni-Knee with its $1.9 billion buyout of Howmedica from Pfizer (NYSE:PFE) in 1998, ended up paying out $7.62 million to settle the liability suits after problems with the implant surfaced.
After TIG Insurance refused to cover its losses, the Kalamazoo, Mich.-based orthopedics giant sued to recoup the direct settlements it paid out of its own pocket. TIG argued that the claim isn’t covered because Stryker didn’t ask for its consent before inking the settlements.
Last year Judge Robert Holmes Bell of the U.S. District Court for Western Michigan disagreed, ruling that Stryker didn’t need TIG’s approval to settle the suits and ordering TIG to cover them.
Bell closed the case out May 15, ruling that TIG must pay Stryker a total of $8.6 million and cough up another $2,000 a day until the amount is paid in full. The order includes $6.2 million in principal, pre-judgment interest of $668,000 and penalty interest of $1.8 million, according to court documents.