Friday 19 January 2018

Medtronic settles US contracting lawsuit for €4m

Medtronic Chief Executive Omar Ishrak
Medtronic Chief Executive Omar Ishrak

Dublin-headquartered Medtronic has agreed to pay $4.4m (€4m) to settle a US lawsuit accusing the company of passing off Asian medical devices to the American military as made in Tennessee.

Three Memphis whistleblowers filed the lawsuit alleging Medtronic funneled devices made in China, India and Malaysia into its Memphis distribution center for relabeling.

The lawsuit said that the equipment was sold to the US Department of Defense and the US Department of Veteran Affairs during an eight-year span from January 2007 until September 2014.

The US Justice Department said in a statement: "The United States alleged that Medtronic sold to the United States products manufactured in China and Malaysia, which are prohibited countries under the TAA (Trade Agreements Act).”

Medtronic became Ireland’s largest company when it completed its $49.9 billion acquisition of Dublin-domiciled surgical supplies group Covidien earlier in the year and moved its corporate headquarters to Ireland in a new holding company, Medtronic plc.

The company said in a statement: “This resolution focused on a limited number of accessories and surgical instruments used in spinal surgeries that were provided to Medtronic by third-party suppliers and were manufactured in China or Malaysia. The overwhelming majority of Medtronic’s products are manufactured in the United States or its trading partners, such as Mexico or Ireland.”

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