Court Overturns Medtronic's Patent Damage Award, Orders Retrial

A U.S. federal appeals court recently overturned a federal jury’s decision that awarded damages to Medtronic in its patent infringement suit against NuVasive Inc. The court ordered a retrial to determine a new figure for damages claimed by Medtronic. However, the appeals court upheld the jury’s decision that NuVasive infringed on certain patents claimed by Medtronic.

A jury in San Diego had ruled in 2011 that Medtronic unit Warsaw Orthopedic Inc. was entitled to receive $101.2 million in damages from NuVasive after it found NuVasive liable for patent infringement of spinal surgery device technologies, Reuters reports. The three-judge U.S. Court of Appeals for the Federal Circuit, however, recently overturned that decision because the basis for the award figure was deemed erroneous. The court ruled that Warsaw was not permitted to recover damages in the form of lost profits and ongoing royalties.

“Our rejection of Warsaw’s claims for lost profits does not mean that Warsaw is precluded from any recovery. Warsaw is entitled to a reasonable royalty sufficient to compensate it for the value of what was taken from it — the value of the patented technology,” the appeals panel said, according to Reuters.

The panel sent the patent case back to the district court for a new trial to set a new figure for damages based on reasonable royalty alone.

“We are pleased with today’s legal ruling,” Alex Lukianov, chairman and CEO of NuVasive, said in a statement. “This provides greater clarity on the process moving forward and affirms our view that Medtronic had been awarded an excessive amount of damages. By limiting the damages to only a reasonable royalty, we believe our overall exposure in this phase of the litigation has been reduced from the current amount we have accrued. We look forward to the upcoming retrial.”

Nuvasive said in the statement that the new trial could start later this year.

According to an article in the Wall Street Journal, the jury in 2011 had ruled that NuVasive’s CoRoent XL implants, MaXcess II and III retractors, and Helix and Helix mini anterior cervical plates infringed on three Medtronic spinal implant patents.

The federal appeals court upheld that ruling that held NuVasive liable for patent infringement. In a recent statement, Medtronic hailed the panel’s decision to uphold the jury’s original decision and said that they are “confident that the retrial will return an award that is appropriate to the damages we are seeking in this case,” according to the WSJ.