Zimmer (NYSE:ZMH) is on the hook for more than $210 million in damages owed to rival Stryker (NYSE:SYK), after a federal judge in Michigan tripled a jury’s $70 million decision.
Kalamazoo, Mich.-based Stryker sued orthopedics rival Zimmer in December 2010, alleging infringement of 3 patents covering wound debridement technology with Zimmer’s Pulsavac Plus device.
Last February a jury in the U.S. District Court for Western Michigan awarded $70 million to Stryker in damages plus royalties, ruling that Zimmer infringed all 3 patents claimed in the suit.
Yesterday Judge Robert Jonker shot down 10 motions filed by Zimmer and granted the 5 put up by Stryker, ordering a permanent injunction barring infringement of the sole remaining in-effect patent by the infringing Pulsavac Plus device.
In addition to tripling the damage award, Jonker granted Stryker’s bid for lost profit damages, awarding another nearly $2.4 million. The judge also granted Stryker’s motion for prejudgment interest, awarding nearly $11.2 million, plus reasonable attorney’s fees and additional prejudgment interest on those fees at a rate of 3.83%.
"Given the one-sidedness of the case and the flagrancy and scope of Zimmer’s infringement, the court concludes that treble damages are appropriate here," Jonker wrote, according to court documents. "At bottom, there is simply no good reason not to treble the award of supplemental damages here when the court has determined that treble damages are appropriate for pre-November-30th lost profits.
"Zimmer chose a high-risk/high-reward strategy of competing immediately and aggressively in the pulsed lavage market and opted to worry about the potential legal consequences later," he wrote. "By pursuing this action, Zimmer has forced Stryker and this court to expend considerable resources in the name of a case that, for the most part, was not terribly close."