Zimmer (NYSE:ZMH) settled a lawsuit with a prominent orthopedic surgeon who claimed a right to royalties for his work on some of the medical device company’s knee implants, agreeing to dismiss the case with prejudice.
Dr. Norman Scott, who is a professor of orthopaedic surgery at the Albert Einstein College of Medicine and a founding director of the Insall Scott Kelly Institute for Orthopaedics and Sports Medicine, sought to be included in a trio patents along with another physician, Dr. Giles Scuderi.
The pair alleged that they helped conceive the novel claims in the patents, 2 for a "Four compartment knee" and 1 for a "Tibial knee component with a mobile bearing," but the U.S. District Court for Delaware shot down those claims in August 2012, according to court documents.
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"Neither Dr. Scott nor Dr. Scuderi is an inventor of any of the patents," Judge Gregory Sleet wrote.
Zimmer then asked the U.S. District Court for Northern Indiana to vacate an arbitration panel’s decision to award Scott royalties on sales of 4 of Zimmer’s knee implants, according to the documents. Zimmer paid out $67 million in royalties on the NexGen implant, according to the documents, but disputed Scott’s involvement in developing the other implants.
"In this case, an arbitration panel has directed Zimmer to make millions of dollars in royalty payments to Dr. Norman Scott for sales of orthopedic implants for which it is undisputed that (a) Dr. Scott did not participate as a surgeon consultant on the design or development teams for any of the implants in question, (b) Dr. Scott is not named on any patents covering such implants, and (c) Dr. Scott did not in fact devote a single hour of his time to the design or development process for such implants," according to the documents.
But on July 12, both parties agreed to dismiss the case, with each bearing their own legal costs, according to the documents.
