Business & Tech

Covidien Sued Over Patent; Looks To Sell Hazelwood Based Drug Unit, Sources Say

The lawsuit is one in a long history of court fights between both companies.

Applied Medical Resources Corp. has sued for allegedly infringing on a medical device patent.

At issue is a patent for trocars, which are sharp devices used during laparoscopic surgeries. They are used to introduce ports in the abdomen. 

This is a new battle in the war that Covidien and Applied Medical have endured regarding patents since 2003. 

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Covidien won a $4.8 million suit against Applied Medical in March 2010 when a Texas jury agreed in favor of the company in a patent infringement lawsuit, according to Massachusetts Medical Devices Journal.

That award was from an October 2009 filing where Covidien alleged that Applied Medical's Kii and Universal Seal laparoscopic trocars infringed upon five of Covidien's patents.

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This latest suit Applied Medical is bringing was filed May 17 in the U.S. District Court for the Central District of California, a St. Louis Business Journal article reports.

"The new case reflects Applied Medical’s continued determination to defend and protect its intellectual property," the Orange County, Calif.-based company said.

Covidien filed counterclaims to Applied's suit for alleged "patent misuse, non-infringement and invalidity."

In its answer, Covidien denied Applied's claim of patent infringement, according to the article.

"We will continue to vigorously defend our intellectual property," said Ralph Corradi, Vice President of the Endomechanical Franchise of Covidien, in a statement.

The litigation is ongoing and no trial date has been scheduled.

Covidien is also making headlines as it is reportedly looking for a buyer for its St. Louis-based pharmaceuticals business. The unit would go for between $3 to $4 billion.

A St. Louis Post Dispatch article reports that Covidien, which is  drug the world's largest manufacturer of acetaminophen and one of the largest manufacturers of medicinal opiates, had been in talks with another health care company interested in acquiring the drug unit before those discussions broke down recently.

The St. Louis Post Dispatch article states the source of this information declined to be identified because the matter is private. Other potential buyers are still looking at the business, the person said, adding that JPMorgan Chase & Co. is advising Covidien on its options for the unit.

Bruce Farmer, a spokesman for Covidien, declined to comment, but Covidien's proposed sale of the drug unit fits the strategy outlined in March by outgoing Chief Executive Richard Meelia, according to the article.

Covidien units Mallinckrodt Pharmaceutical and Mallinckrodt Imaging are both based in Hazelwood.


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