St. Jude Medical Inc. hopes to close the book on years of legal woes by agreeing to pay investors $39.25 million to settle a class-action lawsuit that had accused the Little Canada-based company and its top leaders of concealing problems with wire leads on its cardiac rhythm management devices.
The agreement, released Thursday by the U.S. District Court in Minnesota, stems from lawsuits filed in December 2012 following deaths and injuries linked to St. Jude’s Riata-brand leads and concerns raised about a successor product, Durata. Leads are thin wires that carry electric shocks from an implanted defibrillator to get heart rhythms back to normal.
Investors claimed St. Jude executives “misled investors by consistently presenting Durata as a well-researched, well-designed improvement to the Riata lead design, statements that led investors to push St. Jude’s share prices higher.”
They charged that St. Jude redacted portions of an inspection report pertaining to concerns about Durata, which was portrayed as a safer product after St. Jude pulled the Riata leads off the market in 2010 after reports of defects surfaced.
Some 22 deaths were attributed to the device.
The settlement will be paid to those who owned St. Jude stock between Feb. 5, 2010, and Nov. 20, 2012.
As part of the agreement, St. Jude admits no wrongdoing. Officials at the global heart-device maker did not return requests for comment.
Gregg Levin, a lawyer with South Carolina-based Motley Rice, which represented some of the investors, said attorneys were “pleased to have reached the settlement for the class.”
St. Jude has settled numerous other complaints associated with its troublesome leads, including an agreement in February to pay $14.25 million to settle about 950 claims from patients that their Riata defibrillator leads were prematurely degrading.
In April, the company announced it was being acquired by Illinois-based Abbott Laboratories in a deal worth more than $30 billion.