Stryker, Zimmer Biomet settle poaching spat

Stryker (NYSE:SYK) and Zimmer Biomet (NYSE:ZBH) agreed to bury the hatchet in a lawsuit Stryker brought accusing its orthopedics rival of poaching sales reps.

Kalamazoo, Mich.-based Stryker sued Zimmer Biomet in March in the U.S. District Court for Southern Texas, alleging “concerted and deliberate unfair competition, improper use of Stryker’s confidential and trade secret information, and improper solicitations of Stryker’s customers and employees” in the Houston area.

Zimmer Biomet allegedly enticed a pair of Stryker reps, Andrew Ruggles and Carson Combs, to set up a rival foot & ankle business targeting Stryker customers in breach of their non-compete and non-solicitation agreements, according to the lawsuit. The ex-reps “are now moving the business of those Stryker customers to defendants and utilizing Stryker confidential and trade secret information,” Stryker alleged.

Ruggles quit Stryker in November 2016 and allegedly recruited Combs to follow suit just 4 days later, according to the suit, which asked Judge Gray Miller for a temporary restraining order and preliminary injunction barring Zimmer Biomet, Ruggles and Combs from further alleged violations, according to court documents.

Zimmer Biomet in May moved to dismiss the case, arguing that although Stryker’s claims are pegged to Ruggles and Combs, it inexplicably failed to name them as defendants. In a June 7 response, Stryker maintained that no law requires them to name the duo, because it’s going after Zimmer Biomet and not them.

Yesterday Judge Gray Miller dismissed the case without prejudice, giving the companies 60 days to finalize the settlement agreement, according to court documents.

“Having been advised that a settlement has been reached between plaintiff and defendant, the court dismisses this case without prejudice to reinstatement of plaintiff’s claims if any party represents to the court within 60 days from the date of this order that the settlement could not be completely documented. The court retains jurisdiction over any settlement agreements,” Miller wrote.