A federal appeals court on Wednesday revived a lawsuit accusing Medtronic Plc of defrauding shareholders by covering up negative side effects from its Infuse bone growth product for nearly a decade.
The 8th U.S. Circuit Court of Appeals in St. Paul, Minnesota said a lower court judge erred in finding that the plaintiff shareholders sued too late, by waiting more than two years after learning information that could suggest an intent to defraud.
Medtronic did not respond to requests for comment.
The plaintiffs include the West Virginia Pipe Trades Health and Welfare Fund, the Employees' Retirement System of the State of Hawaii and Germany's Union Asset Management Holding AG.
Medtronic developed Infuse as an alternative to bone grafts, and the U.S. Food and Drug Administration approved it for use in some lower back spinal surgeries in 2002.
But off-label uses of Infuse eventually comprised 85 percent of sales. The FDA in 2008 warned against such uses, following reports of life-threatening complications.
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