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Judge Delays Approval of Boston Scientific Guidant Defibrillator Settlement

Apr 6, 2010 | Parker Waichman LLP

Boston Scientific's proposed plea agreement with the federal government over faulty Guidant defibrillators may be in jeopardy. Lawyers for people implanted with the potentially defective implantable defibrillators are seeking a portion of the $296 million settlement.

Plaintiffs lawyers convinced a federal judge yesterday to delay approval of a deal that would have resolved federal criminal charges against the company. Yesterday’s hearing in U.S. District Court in St. Paul, Minnesota before Judge Donovan Frank was expected to be routine, and end with the judge approving the $296 million settlement. Instead, Judge Frank said he’ll decide on the fate of the device maker’s guilty plea in the next three weeks.

According to the Minneapolis Star Tribune, the government investigation that resulted in the proposed settlement centered on three Guidant devices that had the potential to short-circuit — the Ventak Prizm 2 DR (Model 1861) and the Contak Renewal (Models H135 and H155) models of implantable defibrillators. According to the charges filed in federal court, Guidant violated the Food, Drug and Cosmetic Act by concealing information from the U.S. Food & Drug Administration (FDA) about catastrophic short-circuiting failures in the three models. The company discovered problems with one of the products in 2002 and became aware of problems with two others in 2004, the department said.

Three safety alerts were issued about these defibrillators in June 2005. The FDA later determined these were Class I recalls, which are the most serious type of device recall because there is a reasonable change the devices could cause serious health problems or death. According to the Wall Street Journal, malfunctions in the products were linked to multiple deaths. Federal prosecutors have alleged that Guidant executives knew about the problems and changed the design of its implantable defibrillators years earlier, falsely telling the FDA its design changes did not affect safety or effectiveness.

Boston Scientific agreed in November to plead to the charges and pay $296 million to resolve the Guidant charges with the U.S. Department of Justice. Boston Scientific acquired Guidant in 2006 for $28.4 billion.

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