QT Vascular wins patent spat with Spectranetics

QT Vascular said it prevailed in a court case brought against it by Spectranetics (NSDQ:SPNC) subsidiary Angioscore over patent infringement issues with QT Vascular’s Chocolate PTA balloon catheter.

After a 7-day jury trial in the U.S. District Court for the Northern District of California, the jury ruled that QT Vascular’s Chocolate catheter did not infringe on any of the asserted claims brought against it, and claimed that certain claims of the asserted patent are invalid.

“Although we are disappointed by the jury’s verdict, we are pleased this paves the way for entry of the judgment against the defendants in the breach of fiduciary duty portion of this case. This verdict has no bearing on our leadership position in the scoring balloon market, our commercial execution or future pipeline,” Spectranetics CEO Scott Drake said in prepared remarks.

Spectranetics said the verdict has “no impact on the Court’s findings or award of damages in connection with the breach of fiduciary duty claims or the ability to recover advanced fees and costs,” and that the patent spat was merely a part of a previous lawsuit, which Spectranetics won earlier this year.

In July, Spectranetics’ AngioScore won a $20 million judgment against co-founder and former board member Eitan Konstantino, after a federal judge ruled that Konstantino violated his duties to AngioScore when he started TriReme Medical, Quattro Vascular and QT Vascular.

AngioScore, which Spectranetics acquired last year for $230 million, accused Konstantino of breaching his fiduciary duties to AngioScore by developing the TriReme’s Chocolate balloon catheter, which competed directly with AngioScore’s AngioSculpt balloon. The Chocolate device won 510(k) clearance from the FDA in June 2014. The lawsuit, filed in June 2012 in the U.S. District Court for Northern California, also accused TriReme, Quattro and QT Vascular (SGX:5I0) of abetting in Konstantino’s alleged breaches.

Judge Yvonne Gonzalez Rogers agreed July 1, ordering Konstantino to disgorge $250,000 received for licensing the Chocolate rights and a 2.85% royalty on sales of the device. Gonzalez Rogers also ordered Konstantino to cough up his roughly 15 million shares in QT Vascular, which were worth about $2 million at their July 2 closing price of ¢13.5 (0.182 SGD), and any profits gleaned from sales of the stock and any remuneration from consulting on the Chocolate device.

The judge also awarded nearly $3.0 million in lost profits and another $17.1 million in future lost profits to AngioScore on future sales from 2014 through the 2nd quarter of 2019. The news sent QT Vascular shares plunging some -36.3% in Singapore, to a SGD 11.6¢ close July 8.

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