Full Press Release Details
Medical Care announces status in Patent Case
Bad Homburg, Germany Fresenius Medical Care AG & Co. KGaA ( The
Company ) today announced that the United States District Court for the
Northern District of California issued orders in the long standing patent case
initiated by the Company to establish the invalidity of certain patents claims
alleged to apply to the Company s 2008K hemodialysis machines in United States.
These orders reflect another step in this lengthy legal process. The Company
continues to believe with good reasons that these patents claims are invalid as
determined by the U.S. Patent Office in recent reexaminations and will therefore
appeal the court decision with confidence. In addition, the Company has
prudently developed a back up design while this legal process continues and
expects no material impact on its product business with hemodialysis machines.
The United States District
Court for the Northern District of California has entered orders denying
Baxter s motion for a new trial, establishing a royalty for continuing sales
and deferring entry of an injunction until January 2009.
Fresenius Medical Care
Holdings ( FMCH ) intends to appeal to the United States Court of Appeals for
the Federal Circuit for reinstatement of the original jury verdict (July 2006)
of invalidity on all patent claims remaining in this case relating to touch
screen interfaces for hemodialysis machines.
In June 2006, Fresenius
Medical Care Holdings prevailed in a jury trial relating to patent claims
regarding touch screen interfaces for hemodialysis machines when the jury found
all of the patent claims asserted against FMCH to be invalid.
The trial court overturned
that jury s verdict and ordered a new trial to determine damages. In October
2007 a second jury, in the trial to determine damages, rejected Baxter s demand
that FMCH pay more than $149 million and instead awarded damages of $14.3
million on FMCH s sales of more than $2 billion of hemodialysis machines and
disposables through October 2007.
On April 4, 2008, the trial court
denied Baxter s motion to overturn the second jury s $14.3 million damage award
and order a second new trial. Nevertheless, the Court entered orders
establishing royalties of 10% on all sales of 2008K hemodialysis machines and
7% on sales of related disposables beginning November 7, 2007, and deferred enjoining
sales of 2008K machines until after January 1, 2009.
Since the initiation of this
litigation, the United States Patent and Trademark Office ( USPTO ), in
re-examination proceedings, has rejected all the asserted claims of the patents
as invalid and obvious. The USPTO s rejections of the two patents central to
this dispute have been made final.
With several previous decisions
clearly in favor of the Company, FMCH will appeal to the Court of Appeals for
the Federal Circuit to have the original June 2006 jury verdict of invalidity
reinstated and will seek a stay of the injunction pending resolution of the
Dr. Ben J. Lipps, Chairman of
the Management Board of FMCAG KGaA commented, We are convinced that the
original verdict of invalidity was amply supported by the evidence. We note
that the Unites States Patent and Trademark Office similarly found the claims
to be invalid when presented with a substantial record of prior art. We are
confident that based on that record the Court of Appeals will confirm the original
jury verdict of invalidity. In the meantime, we have developed alternate user
interface designs and with the respite given, we do not expect any material
impact for our North American business. We will continue to provide to patients
and providers the machines and supplies that meet our exacting standards for
quality and reliability.
Fresenius Medical Care is the
world s largest integrated provider of products and services for individuals
undergoing dialysis because of chronic kidney failure, a condition that affects
more than 1,600,000 individuals worldwide. Through its network of 2,238
dialysis clinics in North America, Europe, Latin America, Asia-Pacific and
Africa, Fresenius Medical Care provides dialysis treatment to 173,863 patients
around the globe. Fresenius Medical Care is also the world s leading provider
of dialysis products such as hemodialysis machines, dialyzers and related
disposable products. Fresenius Medical Care is listed on the Frankfurt Stock
Exchange (FME, FME3) and the New York Stock Exchange (FMS, FMS/P).
For more information about
Fresenius Medical Care visit the Company s website at www.fmc-ag.com.
This release contains forward-looking
statements that are subject to various risks and uncertainties. Actual results
could differ materially from those described in these forward-looking
statements due to certain factors, including changes in business, economic and
competitive conditions, regulatory reforms, foreign exchange rate fluctuations,
uncertainties in litigation or investigative proceedings, and the availability
of financing. These and other risks and uncertainties are detailed in Fresenius
Medical Care AG & Co. KGaA s reports filed with the U.S. Securities and
Exchange Commission. Fresenius Medical Care AG & Co. KGaA does not undertake any
responsibility to update the forward-looking statements in this release.