Stryker loses bid to toss ex-sales rep’s counter-claims

Stryker (NYSE:SYK) this month lost a bid for summary judgment in a lawsuit against a former sales rep who jumped ship for Zimmer Biomet (NYSE:ZBH).

Stryker in 2013 sued a pair of former sales agents, Christopher Ridgeway and Richard Steitzer, accusing them of scheming to poach reps and business from Stryker in Louisiana and New York. Stryker fired Ridgeway in September 2013, after discovering that he was allegedly running a pair of medical supply businesses on the side. In June of that year, Stryker alleged, Biomet began courting Ridgeway, allegedly looking to bring his entire Stryker sales teams on board. Ridgeway also allegedly induced a 3rd Stryker employee, Sheldon Green, to jump ship for Biomet and forwarded Stryker’ Louisiana customer list to Green, according to the complaint.

In November Judge Robert Bell of the U.S. District Court for Western Michigan shot down Ridgeway’s bid for summary judgment. Stryker asked Bell to dismiss the remaining claims in Ridgeway’s counter-suit, arguing that Ridgeway breached a non-compete agreement, denied defaming him and rejected Ridgeway’s claim that several co-workers told him he wasn’t subject to a non-compete pact, according to court documents.

Bell found that Ridgeway introduced enough evidence to create issues of fact for a trial, according to court documents, including evidence that Stryker committed fraud and violated the Louisiana Unfair Trade Practices Act when it redacted another employee’s name from a contract, then attached the contract to a copy of a faxed signature page from Ridgeway and presented it in court as a genuine contract.

Bell wrote that he is “satisfied that Ridgeway has presented sufficient evidence to create issues of fact regarding the existence and terms of the alleged non-compete agreement, whether Stryker’s claim that Ridgeway had a non-compete agreement was false, the manner in which the non-compete agreement was re-created, and Stryker’s motivation for asserting rights under a non-compete agreement with Ridgeway.”

“Although Ridgeway himself cannot deny the authenticity of what plaintiffs contend is his agreement, he has pointed to circumstantial evidence that is sufficient to create issues of fact for trial regarding the existence and terms of his non-compete. He has pointed to evidence in the record that in its original complaint, Stryker falsely represented that it had attached a ‘true and correct copy’ of Ridgeway’s non-compete agreement even though Stryker did not have a copy of his non-compete agreement, and had attached a redacted copy of another individual’s non-compete agreement,” the judge wrote. “Ridgeway has also presented evidence that multiple people at Stryker advised him that he did not have a non-compete agreement in his personnel file.”

Bell also found that, although some of Ridgeway’s evidence asserting the defamation claim doesn’t pass muster, other evidence backs up the claim, citing emails and depositions from other Stryker employees.

“The court finds that although Ridgeway does not have as much evidence of defamation as he claims, he has come forward with enough evidence to defeat Stryker’s motion for summary judgment on his defamation claim,” he wrote.

And, he found, “Stryker’s assertion that there is ‘no evidence’ to support Ridgeway’s claim is disingenuous.”

“Whether Stryker superiors or human resources personnel told Ridgeway he did not have a non-compete agreement and whether they should reasonably have expected to induce action on Ridgeway’s part are questions of fact for trial,” Bell wrote.

In July 2014, Biomet and Steitzer asked Bell to enforce an oral settlement they allege was reached between their lawyer and a Stryker attorney. But the judge found that Steitzer and Biomet failed to prove that an agreement was reached.

Last month, the U.S. Supreme Court agreed to consider whether Stryker’s $70 million patent infringement win over Zimmer Biomet should be tripled, after a federal appeals court rolled back a willful infringement verdict last year.

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