News on GSII which used to be in the portfolio. Does this win make the company attractive again? Thanks, Lisa
General Surgical Innovations Wins Patent Litigation Against
Guidant Corporation; Awarded $12.9 Million in Damages
PR Newswire - February 09, 1999 07:46
CUPERTINO, Calif., Feb. 9 /PRNewswire/ -- General Surgical Innovations, Inc. (GSI), (Nasdaq: GSII)
today announced that it has been awarded recovery of approximately $12.9 million in damages in a patent
infringement proceeding against Origin Medsystems, Inc., a division of Indianapolis-based Guidant
Corporation (NYSE: GDT). The damages award resulted from a jury decision yesterday in United States
District Court for the Northern District of California that upheld the validity of GSI's patent (5,514,153),
which was issued in May 1996. The Company believes it is entitled to a permanent injunction that would
prevent Origin from making, using, offering to sell, or selling its VasoView, ExtraView, and PDB
products. The Court had previously granted summary judgment that Origin's VasoView, ExtraView, and
PDB products infringe certain claims in the patent owned by GSI. The GSI patent covers the Company's
SPACEMAKER(R) balloon dissection technology for minimally invasive surgical procedures.
GSI President and CEO Gregory D. Casciaro commented, "The jury's finding in GSI's favor clearly
confirms our right to this technology and recognizes GSI as the pioneer of balloon dissection technology.
We have always maintained that our portfolio of patents was strong and we will continue to vigorously
defend against misuse of our intellectual property.
"Although we expect Origin to appeal," Casciaro added, "we are pleased and believe that this issue has
finally been settled. Our organization can now direct its resources to increase our market penetration in
balloon dissection technology for the hernia repair and stress urinary incontinence markets, as well as the
markets for aesthetic and reconstructive breast surgery, vein harvesting and chronic venous insufficiency
surgery. We have refocused our distribution strategy in the U.S. and abroad, expanded our product line
and established a full range of kits to meet the needs of surgeons in each of our markets. We believe we
are well positioned to move forward with our plans to grow the Company."
The United States Court for the Northern District of California previously awarded GSI recovery of
approximately $1,000,000 in attorneys' fees involving its litigation with Origin relating to a suit filed by
Origin in May of 1996. Origin sued GSI for infringement under Origin's patent number 5,520,609, which
was issued on the day Origin filed suit. In April 1999, however, the United States District Court found
that Origin had obtained this patent through inequitable conduct by misrepresenting material facts to the
Patent Office. The Court therefore found this patent to be unenforceable and ruled that GSI is entitled to
recover attorney fees. Origin has appealed both rulings.
GSI's SPACEMAKER(R) tissue dissection systems are based on the company's patented balloon
dissection technology and incorporate ancillary instruments to facilitate minimally invasive surgical
procedures. Minimally invasive, or "keyhole," surgeries were initially limited to procedures carried out
within the abdominal cavity which provided a working space for the surgeon. Balloon dissection methods
are used to create working spaces where no naturally occurring space exists and have enabled surgeons
to extend their use of minimally invasive techniques to a broader range of procedures. With the use of
GSI technology, patients routinely receive such benefits as reduced pain and faster recovery times.
Headquartered in Cupertino, California, General Surgical Innovations, Inc. develops, manufactures and
sells tissue dissection systems based on the Company's patented balloon technology for minimally
invasive surgical procedures. The Company's products are specifically designed for endoscopic and
laparoscopic techniques used in general, cardiovascular, orthopedic, cosmetic and reconstructive
surgeries to create an operating space at the surgical site, lessen tissue damage and improve patient
recovery time. The Company has developed a broad range of balloon shapes and sizes to be used for
various surgical techniques, procedures, and market segments. GSI distributes its products worldwide
through a network of distribution partners and a direct sales force. For additional information, please visit
the Company's World Wide Web site at www.gsii.com.
Except for the historical information contained herein, the matters discussed in this press release are
forward-looking statements, the accuracy of which is necessarily subject to risks and Uncertainties.
Future market demand for the Company's products, among other matters discussed in this release, may
differ significantly from the discussion of such matters in the forward-looking statements. Such
differences may be based upon factors within General Surgical Innovations' control, such as strategic
planning decisions by management and reallocation of internal resources, or on factors outside of General
Surgical Innovations' control, such as the outcome of patent litigation, as well as those factors set forth
under the heading "Factors Affecting Future Results" in General Surgical Innovations' Annual Report (on
Form 10K for the year ended June 30, 1998, Form 10-Q for the quarter ended September 30, 1998 and
other company filings with the Securities and Exchange Commission.
SOURCE General Surgical Innovations, Inc.
/CONTACT: Stephen J. Bonelli, CFO/VP Finance and Administration of
General Surgical Innovations Inc., 408-863-2500, invrel@gsii.com; or Matthew
Clawson, matt@allencaron.com, investor relations, or Owen Daley,
owen@allencaron.com, media inquiries, both of Allen & Caron Inc.,
714-957-8440/
/Web site: gsii.com
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