Advertisement
U.S. markets closed
  • S&P Futures

    5,304.25
    -4.00 (-0.08%)
     
  • Dow Futures

    40,140.00
    -36.00 (-0.09%)
     
  • Nasdaq Futures

    18,465.00
    -38.75 (-0.21%)
     
  • Russell 2000 Futures

    2,145.20
    +6.80 (+0.32%)
     
  • Crude Oil

    83.11
    -0.06 (-0.07%)
     
  • Gold

    2,254.80
    +16.40 (+0.73%)
     
  • Silver

    25.10
    +0.18 (+0.74%)
     
  • EUR/USD

    1.0781
    -0.0013 (-0.12%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • Vix

    13.01
    +0.23 (+1.80%)
     
  • GBP/USD

    1.2625
    +0.0003 (+0.02%)
     
  • USD/JPY

    151.3480
    -0.0240 (-0.02%)
     
  • Bitcoin USD

    70,830.30
    +1,438.77 (+2.07%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Nikkei 225

    40,341.41
    +173.34 (+0.43%)
     

Covidien Loses $176M Award in Patent Case Against JNJ Unit

The patent infringement war between Covidien plc (COV) and Johnson & Johnson (JNJ) subsidiary Ethicon Endo-Surgery Inc. received a fresh ruling from the top U.S. patent appeals court last Thursday.

Judge Sharon Prost of the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., tossed the $176 million award that Covidien had earned last year with regard to its patent dispute with Ethicon, according to a Reuter report.

In 2010, Covidien had leveled charges against Ethicon’s Harmonic line of ultrasonic surgical devices stating that the products infringed three of the company’s patents. In Mar 2013, the U.S. District Court held that Covidien’s patents were valid, enforceable and violated by Ethicon which had resulted in a $176 million verdict in favor of Covidien.

The amount was based on an 8% royalty rate on infringing sales through Mar 2012, plus prejudgment interest. However, Ethicon filed a petition against the judgment in a higher court.

As per Thursday’s ruling, Covidien’s patent claims were termed invalid. The judge held that the inventions referred by Covidien's patent claims that include the use of a curved blade instead of a straight one, were obvious in light of previous technology.

Shares of both Covidien and Johnson & Johnson closed little changed at $102.50 and $107.56, respectively, last Thursday.

In Jun 2014, Covidien had leveled another lawsuit against Ethicon, alleging that the latter’s latest ultrasonic surgical product – Harmonic ACE+7 – infringes three of Covidien’s patents. The lawsuit pleaded with the court to order Ethicon to terminate production and sale of the devices and grant damages for the same.

In Dec 2011, Ethicon had also brought infringement charges against Covidien’s Sonicision cordless ultrasonic dissection system. According to a ruling issued by the U.S. District Court for the Southern District of Ohio on Jan 22, 2012, Covidien had not violated any of the seven Ethicon patents in dispute.

In the 2012 ruling, the Court declared that five of Ethicon’s patents were not valid. Based on this judgment, Ethicon’s patent infringement action was dismissed and Covidien was allowed to continue selling its Sonicision system.

Currently, both Covidien and Johnson & Johnson carry a Zacks Rank #3 (Hold).

Better-ranked stocks in the medical products industry include GW Pharmaceuticals (GWPH) and ICU Medical (ICUI). Both the stocks sport a Zacks Rank #1 (Strong Buy).

Read the Full Research Report on COV
Read the Full Research Report on JNJ
Read the Full Research Report on GWPH
Read the Full Research Report on ICUI


Zacks Investment Research

Advertisement