Stryker subsidiary settles trade secrets clash with Zimmer
A subsidiary of medical technology company Stryker has settled its clash over trade secrets with Zimmer, a medical device business.
Howmedica Osteonics, a manufacturer and distributor of orthopaedic products and services, had sued Zimmer in March, accusing the company of improperly using Stryker’s confidential and trade secret information, and soliciting Stryker’s customers and employees.
According to the claim, which was filed at the US District Court for the Southern District of Texas, Zimmer solicited employees in a bid to set up a competing foot and ankle business targeting Howmedica’s customers.
As part of their employment contracts with the Stryker unit, sales representatives agree not to solicit Stryker customers which they service during their employment for one year following the termination of employment, and agree not to disclose Stryker’s confidential information and trade secrets, said the suit.
“Defendants were well aware of these reasonable restrictions and post-employment obligations yet chose to deliberately ignore them,” added the claim.
Howmedica named two employees that it claimed had begun work for Zimmer selling foot and ankle products to their former Stryker customers.
Zimmer’s counsel allegedly responded to correspondence from Howmedica with assurances that the former employees would abide by the terms of their agreements.
“Defendants’ counsel’s assurances were a ruse,” concluded Howmedica, adding that Stryker lost tens of thousands of dollars of business in the last month of 2016 alone, and stands to lose hundreds of thousands of dollars of business in 2017 because of Zimmer’s actions.
Yesterday, November 28, District Judge Gray Miller signed a conditional order of dismissal (pdf).
“Having been advised that a settlement has been reached between plaintiff and defendant, the court dismisses this case without prejudice,” said the order.
The parties must bring any remaining issues to court within 60 days, along with settlement documentation.
The court will retain jurisdiction over any settlement agreements.
This isn’t the first time Stryker has faced off against Zimmer—in July, LSIPR reported that a Michigan district court had ruled in favour of Stryker in a patent case against Zimmer.
Zimmer was found to have infringed three patents belonging to Stryker, and counterclaims by Zimmer were dismissed by the court.
The court said Stryker was entitled to triple damages on its lost profits (which totalled $70 million), as well as supplemental damages ($6.1 million), and it enjoined Zimmer from selling a surgical device.
The ruling came after a previous US Supreme Court decision, handed down in July 2016, which favoured Stryker by finding that Zimmer had infringed Stryker’s patents covering a surgical device.
