Medtronic Ends Implant Suit for $1.35 Billion

Medtronic said it agreed to buy out patents for spinal implant technology for $1.35 billion in a move that settles a long-running legal battle.

In October 2004, a federal jury ordered the Minneapolis-based medical devicemaker to pay $400 million in punitive damages to Gary Michelson, the inventor of spinal surgical devices sold by Medtronic. The acquisition is expected to close during Medtronic's first fiscal quarter, which ends July 30.

The deal with inventor and surgeon Gary Michelson and Karlin Technology will transfer ownership of more than 100 issued U.S. patents, more than 110 pending U.S applications and roughly 500 foreign counterparts to Medtronic, valued at approximately $800 million. The price also includes royalties and damages the company was ordered to pay by the court. The patents pertain to novel spinal technology and techniques that have current application and the potential for future patentable products.