Cochlear to pay $75m extra if patent judgment upheld

Hearing implant manufacturer  Cochlear has agreed to pay an additional $75 million to settle a patent infringement case if an original  $268 million damages bill is upheld by the US Supreme Court.

Australia-based Cochlear is challenging a  US Court of Appeals for the Federal Circuit ruling that held it liable for infringing patents owned by the Alfred E Mann Foundation for Scientific Research (AMF).

This week, the company announced it had agreed to a $75 million settlement for pre-judgment interest and attorneys’ fees, should the Supreme Court deny its petition for certiorari.

Cochlear will deposit the settlement into an escrow account no later than September 15, with the money to be returned if its appeal is successful.

The Federal Circuit ordered Cochlear to pay the damages to AMF and its exclusive licensee Advanced Bionics in May. Advanced Bionics said at the time that it is in for a windfall of $124 million from the verdict.

Cochlear has argued that the damages award in the foundation and Advanced Bionics’ favour is excessive.

The case dates back to 2007 when AMF originally brought the patent infringement claims. The dispute turned in the plaintiffs’ favour in November 2018, when the US District Court for the Central District of California reinstated an earlier jury award of $134 million for patent infringement.

AMF’s patented technology relates to cochlear hearing implants to be placed in the inner ear. Advanced Bionics began licensing the patents in 2004.

The judgment was subsequently enhanced for willful infringement. The Federal Circuit upheld the award earlier this year, and then denied a petition to review its decision en banc.

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