Sulzer Settlement - Hip Joint Suit Proposal
Sulzer Medica to Settle Hip Joint Suit
ZURICH, Switzerland (AP) - Swiss medical technology company Sulzer Medica said Wednesday that it had made an offer to settle a U.S. class action lawsuit for faulty artificial joints.
The company said it has submitted proposals, drawn up in close cooperation with the attorneys of various plaintiffs, to the U.S. District Court in Cleveland, Ohio.
``Our stated goal is to quickly provide the patients with medical, legal and financial assistance and to handle the damage claims in a just manner,'' Sulzer Medica CEO Stephan Rietiker said in a statement. ``While the financial burden is a heavy one not require surgery would get $2,750.
Compensation in equity requires shareholders' approval.
Executives expect the number of revision surgeries for hips and knees to reach 4,000.
The company expects expenses for corrective surgery, compensation payments and lawyers' fees to reach $500 million to $700 million, Beatrice Tschanz, a spokeswoman for Sulzer Medica told Dow Jones Newswires.
Around $240 million of the total would be financed by insurance coverage, Tschanz said. The company expects to pay the remainder using 50 percent of its net income over the next few years.
The news that Sulzer Medica believes it can ride out the crisis sent its stock price sharply upwards. By close of trading, shares on the Zurich exchange were up 32 percent to 119 francs ($70.83). Sulzer's U.S. shares surged 63 percent, or $3.30, to close at $8.50 on the New York Stock Exchange (news - web sites).
District Court Judge Cathleen O'Malley is expected to rule on the offer within the next 60 to 90 days, Sulzer Medica said.
So far, 1,029 lawsuits have been filed relating to faulty articifical hip joints and two for tibia baseplates, the company said.
The faulty Inter-Op hip implants were made by Sulzer's U.S. subsidiary Sulzer Orthopedics Inc., which is based in Austin, Texas.
The subsidiary announced in December it was recalling the implants after discovering that lubricant residue on the artificial joints could prevent the implant from bonding properly with the bone, causing it to loosen.
About 17,500 patients received Sulzer hip implants overall, primarily in the United States.
The porous-coated tibia baseplates, which are no longer on the market, were implanted in about 1,600 patients during knee operations. Some 1,350 were in the United States, 200 in Europe and 50 in Australia.
| Orthopedic
company offers
settlement to
patients
8/15/01 7:38 PM By: Jitin Hingorani A
Switzerland-based
orthopedic company
is offering
settlements
Last December, the orthopedic company recalled about 40,000 hip implants that were contaminated by a lubricant left over during production. "We have stated from the outset of this problem that we would do right by all the patients who were adversely affected," said Bill Miller, a Sulzer spokesperson. The breakdown of the settlement would give $37,500 in cash and at least $20,000 in stock to each patient who had one bad hip or knee replaced. Those who had more than one surgery would receive $65,000 in cash and at least $32,500 in stock. "In the negotiations and the trial bar ... basically took everything that we could afford to give ... both money that we have, stock that we could give and future earnings," said Miller. "They basically took all of that and put it in the hands of the patients." Several patients' lawyers are rejecting the settlement offered by Sulzer. The lawyers believe their clients deserve more for their pain and suffering. "Most of our clients have very significant problems. They have instability in their hips. They have had infection. They have had to have multiple revisions. Some of them can't walk. Some of them walk with a cane and then all of a sudden it dislocates ... and a lot of these people whether they're young and old, it's the last thing they needed," said Mike Slack, an attorney who represents about 100 clients suing Sulzer. Slack said he is insulted by the amount of the settlement. "It's a sad commentary on Sulzer's judgement to even put a settlement like this forward ... and I think it's offensive to the intelligence of my clients to put it forward," he said. "It remains to be seen whether anybody takes this settlement." On Friday, a federal judge in Ohio will decide whether to grant preliminary acceptance of Sulzer's settlement. Sulzer warned that anyone who decides to continue with a lawsuit would have to wait at least seven years to receive any kind of payment. |
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