A Medical Device Daily

Companies both small and large in the cardiovascular sector reported a variety of wins and losses in the legal arena yesterday.

Two smaller companies that compete in an interventional area focused on closing heart defects reported settling their longstanding patent feud. AGA Medical (Golden Valley, Minnesota) has agreed to pay NMT Medical (Boston) $30 million for a non-exclusive worldwide license.

In the suit, originally filed in March 1999, NMT claimed that AGA manufactured and distributed a septal occlusion device that violated NMT U.S. patent No. 5,108,420. NMT is the licensee of this patent, which was issued to Lloyd Marks, MD, in 1992.

NMT alleged potential infringement by all of AGA's occluding devices, including the Amplatzer Septal Occluder, Amplatzer PFO Occluder, Amplatzer Duct Occluder and Amplatzer VSD Occluders.

The settlement dismisses all claims with prejudice and allows AGA to continue to manufacture and distribute its occluding devices unhampered by further patent litigation from NMT.

Franck Gougeon, CEO of AGA Medical, said the company had been “confident“ in its position, but the settlement allowed continued focus “on expanding our well-established leadership position in the interventional repair of structural heart defects.“

John Ahern, president and CEO of NMT, said his company “is now in a better position to focus its energies on expanding its leadership in the emerging PFO [patent foramen ovale] closure market opportunity. The settlement will also provide us with additional flexibility to accelerate investments in our ongoing PFO closure clinical trials, new technology initiatives, and future sales and marketing programs.“

In disputes among the larger cardio firms:

Cordis (Miami Lakes, Florida) reported that U.S. District Judge Sue Robinson has upheld two March 2005 jury verdicts that Cordis' patents for balloon-expandable stents were valid and infringed by stents from Boston Scientific (Natick, Massachusetts) and Medtronic (Minneapolis).

The juries found Boston Scientific's NIR stent infringed Cordis' Palmaz patent and Medtronic's GFX and Microstent II infringed both the Palmaz and Schatz patents.

Cordis said that the ruling reinforces its patent estate in the area of balloon-expandable stents.

Last year's verdicts, it said, were the second time that juries found infringement of the Cordis patents in these cases. In December 2000, juries awarded Cordis damages of $324 million in the verdict against Boston Scientific and $270 million in the verdict against Medtronic.

Boston Scientific acknowledged the judge's decision in the case and said that it plans a further appeal. It noted that it formerly sold the NIR stent, designed and manufactured by its former Israeli partner, Medinol (Tel Aviv).

It said that the judge denied a motion by Cordis' parent company, Johnson & Johnson (New Brunswick, New Jersey), to reinstate a prior damages verdict and ruled that the issue of damages will be deferred until after all liability issues are determined through appeal.

Medtronic reported filing a patent infringement suit against Guidant (Indianapolis) in the High Court in Dublin, Ireland.

The lawsuit alleges that the Guidant Multi-Link Vision and Xience V coronary stents infringe patents under exclusive worldwide license to Medtronic Vascular from evYsio Medical Devices (Vancouver, British Columbia). Guidant manufactures the affected stent products in Ireland and the U.S.

Medtronic is seeking monetary damages and an injunction against the Vision and Xience stents.

The action in Ireland is one of four patent infringement actions against Guidant products involving the evYsio patents. On Feb. 15, 2006, Medtronic filed a patent infringement case against Guidant in U.S. District Court for the Northern District of California, alleging that Guidant's Vision stent and certain Guidant catheter systems infringe the evYsio stent design patents and Medtronic's Fitzmaurice patents. The Fitzmaurice patents relate to a tapered design feature of Medtronic coronary and peripheral catheters.

evYsio also filed patent infringement cases against Guidant in France in 2001 and 2003, resulting in a ruling on Dec. 17, 2004, against the Vision stent. Finding that the Vision stent likely infringed the evYsio patent and that the evYsio patent was likely valid, the French court ordered Guidant to post a warranty of EUR 800,000 to avoid an injunction against the sales of Vision in France.

On March 3, the validity of evYsio's European patent was affirmed during an opposition hearing initiated by Guidant, and evYsio continues to pursue its two suits against Guidant in the French courts. In addition to Ireland, France and the U.S., the evYsio patents are registered in several other countries.

Medtronic's lawsuits against Guidant in the U.S. and Ireland follow other significant legal developments involving Medtronic's vascular business.

On March 23, Medtronic announced a positive arbitration panel ruling obtained against Johnson and Johnson/Cordis. On March 1, Medtronic filed suit in the U.S. District Court for the Eastern District of Texas against Boston Scientific, alleging that the Taxus paclitaxel-eluting coronary stent system infringes Medtronic's Fitzmaurice and Anderson patents. The Anderson patents cover a method of manufacturing balloon catheters used in stent delivery.

In addition, on Feb. 14, the U.S. Patent and Trademark Office granted Medtronic's Request for Reexamination for each of the four Guidant Lau patents on which that has sued Medtronic for infringement in the U.S. District Court for the District of Delaware.

Finding that “substantial questions exist“ regarding the validity of the Lau patent claims in view of prior art submitted by Medtronic with the Request for Reexamination, the USPTO will reconsider whether the Lau patents should have been granted in the first instance, though the timing of such reexamination is not known.

In other legalities, a U.S. magistrate in Montgomery, Alabama, has rejected a bid by Richard Scrushy to throw out an indictment accusing the former chairman of HealthSouth (Birmingham, Alabama) with bribery.

U.S. Magistrate Charles Coody said Scrushy had failed to demonstrate there had been prosecutorial misconduct and he recommended that a federal judge not dismiss the indictment. U.S. District Judge Mark Fuller will make the final decision.

Scrushy, former Alabama Gov. Don Siegelman and two former members of Siegelman's cabinet were indicted by a federal grand jury last year. Scrushy is accused of providing $500,000 in donations to Siegelman's state lottery campaign in return for an appointment to a state hospital regulatory board. They are scheduled for trial beginning May 1.