Stryker loses bid to dismiss unfair competition class action

by bvernia | September 16th, 2009

District Judge White in San Francisco denied a motion on September 4 by Stryker Orthopaedics, to dismiss a purported class action brought by a patient who received one of the company’s replacement hips. Stryker is one of five orthopedic device makers which settled in 2007 with the US Attorney’s Office in Newark, NJ. The plaintiff alleged that the company entered into phony consulting agreements with surgeons to disguise kickbacks to doctors and hospitals, and that she incurred higher out-of-pocket costs for the procedure. The case was brought under California’s Unfair Competition law, and an unjust enrichment theory.

The court upheld the plaintiff’s complaint, whose allegations of a pervasive kickback scheme and the company’s non-prosecution agreement with DOJ. The Court found that she adequately pled an unlawful business practice and an injury in fact. The Court held that she was not required to plead her case under the state law with particularity.

The Court dismissed the plaintiff’s unjust enrichment claims, however, finding the statute’s remedy to be a sufficient alternative.

Counsel for the plaintiff included Kabateck Brown Kellner LLP and the Sina Law Group. Stryker is represented by Kasowitz, Benson, Torres & Friedman LLP of San Francisco and Stern & Kilcullen, LLC of Roseland NJ.

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