Biomet Orthopedics, Inc. and Biomet (BMET) File Suit Against Zimmer and Others

July 30, 2007 6:29 PM EDT

Biomet Orthopedics, Inc. and Biomet, Inc. (NASDAQ: BMET) recently initiated legal proceedings against Zimmer US, Inc., former Biomet distributors, and David Montgomery, a former Biomet executive who resigned from Biomet in January 2007 and currently works for Zimmer.

The thirteen count lawsuit filed in Marion County, Indiana alleges, among other things, that Zimmer and Montgomery attempted to create an unfair market advantage by engaging in a campaign to misappropriate Biomet confidential information, interfering with Biomet's contractual relations with distributors and attempting to buy the assets of most of Biomet distributors (including Biomet surgical instruments) throughout the country. The lawsuit further alleges that the limited number of distributors who accepted Zimmer's offer are in violation of their contractual obligations to Biomet.

Although nearly all of Biomet's distributors rejected Zimmer's offers and have remained with Biomet, and although no amount of money damages can completely compensate Biomet for the losses it has sustained as a result of this conduct, Biomet is nonetheless seeking to recover compensatory damages that are attributable to financial and other resources spent on signing new agreements with its sales force.

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