A Medical Device Daily
Galil Medical (Yokneam, Israel), a cryotherapy company, filed suit against HealthTronics (Austin, Texas) in Delaware Chancery Court, asking the court to enjoin HealthTronics from further interfering with a merger agreement between Galil and Endocare (Irvine, California) and to order that HealthTronics pay damages to Galil for the harm it has suffered as a result of HealthTronics' "tortious interference" with Galil's rights under that agreement. In the suit, Galil alleges that Healthtronics helped Endocare in its recent attempt to wrongfully terminate the Galil/Endocare merger agreement so that HealthTronics could then acquire Endocare. Galil further alleges that, as a part of the scheme, HealthTronics agreed to cover Endocare's costs if Endocare ultimately is forced to pay a breakup fee to Galil because of its breach of the merger agreement, and notes that HealthTronics has embarked on a snap tender offer for Endocare shares, which will further harm Galil by sowing confusion and uncertainty among Endocare shareholders, and Galil's employees, customers, and suppliers. The HealthTronics tender offer is scheduled to expire on July 21 (Medical Device Daily, June 19, 2009).
The suit against HealthTronics follows Galil's recently-filed lawsuit against Endocare, which also arose out of Endocare's alleged breach of the Galil/Endocare merger agreement. Trial in that action presently is scheduled for July 9 and 10 in Chancery Court in Georgetown, Delaware (MDD, June 15 and 17, 2009).
"Galil looks forward to prevailing in these two lawsuits, and then getting back on the track of completing our merger with Endocare," Marty Emerson, president/CEO of Galil, said in a statement. "A merger between Galil and Endocare is in the best interests of the doctors and patients who rely on us for the important cancer treatment technology we provide today as well as the innovation we will deliver in the future."
The merger agreement between Galil and Endocare was first disclosed in November (MDD, Nov. 14, 2008).