By Mike Scarcella
(Reuters) – Medical technology company Medtronic PLC has asked a U.S. judge in California to dismiss as “threadbare” an antitrust lawsuit from rival device manufacturer Applied Medical Resources Corp accusing it of unlawful discounts and exclusive contracting.
In a filing in Santa Ana federal court, lawyers for Medtronic on Monday night said Applied Medical had failed to show any harm to market competition for a device the two companies make that is used to cut tissue and seal blood vessels during surgery.
Medtronic, the world’s largest standalone medical device maker, said Applied Medical mustered “weak” arguments that Medtronic’s discount program for hospitals — providing them lower prices for using more than one of the company’s products — violated U.S. antitrust provisions.
“Antitrust laws are designed to promote low prices, not high ones, and a competitor may not use these laws to force higher prices to benefit itself,” Medtronic’s attorneys at law firms Cleary Gottlieb Steen & Hamilton and Greenberg Traurig told U.S. District Judge Cormac Carney.
Attorneys for California-based Applied Medical and a representative for the company did not immediately respond to messages seeking comment.
A Medtronic spokesperson in a statement on Tuesday called Applied Medical’s case a “frivolous lawsuit.” Medtronic is based in Dublin, Ireland, but has operational headquarters in Minnesota.
The lawsuit filed in February accused Medtronic, which recorded more than $31 billion in revenue in 2022, of selling its “advanced bipolar devices” below cost and bundled with other products.
Hospitals will not purchase rival devices from Applied Medical for fear of losing discounts on other items, the complaint alleged.
“Medtronic’s conduct has no legitimate business purpose and does not provide any benefits to consumers,” the lawsuit said.
Applied Medical’s complaint seeks unspecified monetary damages for lost profit and an injunction against alleged efforts to “significantly limit and hinder competition.”
A hearing in the case is scheduled for July 17.
The case is Applied Medical Resources Corp v. Medtronic Inc, U.S. District Court, Central District of California, No. 8:23-cv-00268-CJC-DFM.
For Applied Medical Resources: Stephen Jensen, Stephen Larson and Adam Powell of Knobbe, Martens, Olson & Bear
For Medtronic: Leah Brannon and George Cary of Cleary Gottlieb Steen & Hamilton; and Robert Herrington and Richard Tabura of Greenberg Traurig
