On January 12, 2016, the U.S. District Court in Trenton, New Jersey, ruled in favor of KFx Medical Corporation in a lawsuit filed by Arthrex Incorporated on July 31, 2015. The two companies have been involved in an ongoing patent infringement dispute.
According to a January 19, 2016 KFx press release, Arthrex sued KFx and Joe Tauro, M.D. alleging misappropriation of trade secrets, unfair competition, breach of contract and interference. KFx filed a response denying the allegations and asserting that Arthrex’s claims were barred by a judgement in favor of KFx in its earlier successful patent infringement lawsuit against Arthrex. KFx also asserted new counterclaims for patent infringement based on Arthrex’s infringement of U.S. Patent Nos. 8, 926, 663 (“the ‘663 patent”) and 9, 044, 226 (“the ‘226 patent”).
KFx and Tauro moved to have Arthrex’s lawsuit dismissed. The New Jersey Court, according to KFx, agreed and dismissed the case. KFx patent infringement counterclaims against Arthrex continue.
In the original patent suit by KFx against Arthrex, a federal jury in southern California found that Arthrex infringed KFx’s U.S. Patent No. 7, 585, 311 and two other patents. The jury, according to KFx, found the patents were valid and awarded KFx $29 million in damages. Arthrex appealed, but the U.S. Court of Appeals for the Federal Circuit ruled in favor of KFx.
The District Court later awarded additional damages and interest to bring the total judgment to over $35 million. Arthrex asked for a rehearing, but was denied. Arthrex then went to the U.S. Supreme Court with a writ of certiorari, but the Court denied the petition.
After the Supreme Court victory, Tate Scott, KFx’s president and CEO said, “Small companies can indeed win and defend their intellectual property from much much larger companies. The Supreme Court’s ruling today has confirmed KFx patents are valid and infringed by Arthrex. We will continue to require other infringers to respect our intellectual property.”
KFx Medical is a private company headquartered in Solana Beach, California. The company was founded in 2003 to develop products for tissue fixation in orthopedic procedures on the shoulder, knee, foot, and ankle. The company owners include Alloy Ventures, Charter Life Sciences, Arboretum Ventures, Montreux Equity Partners, and MB Venture Partners.
