The Australia-based hearing implant company had appealed a March 2020 federal appeals court decision upholding a U.S. District Court decision that awarded $268 million in damages to those competitors, the Alfred Mann Foundation and Advanced Bionics, the company to which the foundation licensed its implants, for infringing two patents.
Cochear agreed separately in August 2019 to pay $75 million in attorneys’ fees on top of the $268 million in damages it was ordered to pay the foundation and Advanced Bionics in the long-running patent fight.
The Mann Foundation filed the original patent infringement suit in 2007 and Advanced Bionics soon joined in on the suit. In January 2014 a jury in the U.S. District Court for Central California found that Cochlear infringed both patents and awarded $131.2 million in damages. Because the jury also found that the infringement was willful, Cochlear could have been on the hook for treble damages if Judge Fernando Olguin agreed.
However, in April 2015, Olguin vacated the damages award, ordered a new damages proceeding and invalidated 3 of 4 claims in the 2 patents, ruling that they failed to disclose key elements. But, in November 2016, a federal appeals court overturned Cochlear’s victory, sending the case back to district court for reconsideration in light of a recent U.S. Supreme Court decision.
Based on the original judgment, Cochlear paid a total of $280 million to the foundation and Advanced Bionics earlier this year, according to a statement from Cochlear.
“As the patent at issue in the litigation has expired, no further infringement damages can accrue, and this judgment will not disrupt Cochlear’s business or customers in the United States,” the statement said.
Cochlear had placed the $75 million settlement into escrow, contingent upon the outcome of its Supreme Court appeal. With the court’s rejection of the appeal, Cochlear has released that sum to the foundation and Advanced Bionics, the company added. Cochlear provided for the payment of this settlement liability in its fiscal year 2020 financial statements.
“We are, of course, immensely pleased at the news today that the United States Supreme Court has denied certiorari in the case of Cochlear’s appeal,” said Mann Foundation spokesperson John Petrovich in an email to MassDevice. “As Cochlear has announced previously, under the terms of our settlement agreement, US$75 million will now be released from escrow to AMF and Advanced Bionics, and our settlement is now complete and final.
“It is gratifying to have this case reach such a successful outcome for AMF after over 13 years in court,” Petrovich added. “Now both Cochlear and we can focus our attention on helping advance our respective efforts to bring innovative solutions to patients worldwide.”
This article has been updated with comments from Cochlear.