KFx Sues Arthrex Again Over Patent Infringements

Solana Beach, Calif.-based KFx Medical LLC has begun a new patent infringement suit against Naples, Fla.-based Arthrex Inc.

On July 31, after a federal appeals court confirmed a verdict that Arthrex infringed certain patents owned by KFx Medical and compelled Arthrex to pay in excess of $35 million in damages, Arthrex filed a lawsuit in a New Jersey state court against KFx and Joseph Tauro, M.D., alleging misappropriation of trade secrets, unfair competition, breach of contract and conspiracy relating to the same patent claims. On September 1, KFx filed its response, denying Arthrex’s allegations and asserting that the issues Arthrex raised had already been determined at trial and upheld on appeal in the federal court. In response to Arthrex’s lawsuit, KFx also asserted counterclaims arising from Arthrex’s infringement of certain patents held by KFx.

In April, the United States Court of Appeals for the Federal Circuit reaffirmed its Jan. 20 ruling upholding a judgment of the United States District Court for the Southern District of California wherein a jury found that Arthrex infringed three of KFx’s patents, and awarded KFx $29 million in damages. The District Court later awarded additional damages and interest, bringing KFx’s total award to over $35 million. In the April ruling, an Arthrex petition for en banc rehearing was denied and a mandate to enforce the judgment issued. Arthrex paid in excess of $35 million to KFx Medical.

“The judicial system heard the arguments from both sides — KFx won and Arthrex lost,” said Tate Scott, president and CEO of KFx. “The jury found the Tauro et al. patents valid and that Arthrex infringed. Arthrex then lost on every appellate level. This new action is nothing more than a sore loser suit by Arthrex. It is particularly surprising that Arthrex would file this suit and even name Dr. Tauro—a highly regarded leader and surgeon—after Arthrex previously stipulated that KFx was the proper owner of the patented inventions made by Dr. Tauro in collaboration with KFx engineers. Innovative surgeons like Dr. Tauro certainly will have to think twice before sharing any ideas with Arthrex for fear of being needlessly sued.”

KFx Medical makes soft tissue fixation implants.

Arthrex focuses on orthobiologics, as well as arthroplasty and surgical technology for the treatment of arthritis.