| Sept 4
Sept 4 London-based medical device maker Smith &
Nephew PLC has agreed to pay $11.3 million to settle
allegations that it sold the U.S. government devices it claimed
were U.S.-made but actually came from Malaysia.
The settlement was filed Wednesday in Tennessee federal
court, ending a whistleblower lawsuit brought in 2008 by a
former Smith & Nephew information technology manager, Samuel
Cox. Cox will get $2.3 million, the government $6 million, and
$3 million will go toward attorneys' fees, according to the
Under U.S. law, whistleblowers are entitled to a share of a
Cox claimed that Smith & Nephew violated the federal Trade
Agreements Act, which requires contractors to sell the
government products made either in the United States or in
countries it has signed agreements with.
In 2007 and 2008, Smith & Nephew sold the Department of
Veterans Affairs orthopedic devices that it had bought from
Malaysia-based Straits Orthopaedics while claiming they were
made in the United States, according to the lawsuit. Malaysia
does not have a trade agreement with the United States.
The U.S. government did not intervene in the suit but joined
in negotiating the settlement earlier this year, according to H.
Vincent McKnight of Sanford Heisler, an attorney for Cox.
The case is the first whistleblower settlement involving
false country of origin claims for medical devices, according to
a press release from Sanford.
"Today's settlement sends a clear message to those medical
device companies that routinely violate the Trade Agreements Act
by misrepresenting the 'Country of Origin' of goods sold under
contract to U.S. Government agencies," McKnight said in a
Smith & Nephew did not immediately return a request for
The case is United States ex rel. Cox v. Smith & Nephew,
U.S. District Court for the Western District of Tennessee, No.
(Reporting By Brendan Pierson; Editing by Ted Botha, Bernard