A class action lawsuit has been filed on behalf of shareholders who purchased stock in Zimmer Holdings, Inc. between January 28 and July 21, 2008. The Zimmer class action lawsuit alleges that the firm made material misrepresentations by failing to disclose problems arising from the use of the Zimmer Durom Cup in hip implants, which led the firm to suspend sales of the product on July 22, 2008.
The Zimmer class action lawsuit has been filed in the United States District Court for the Southern District of Indiana on behalf of shareholders. The lawsuit alleges that the defendants failed to disclose that a disproportionate number of patients who received the company’s Durom Acetabular Component, which is used during total hip replacements, experienced cup loosening and required additional corrective surgeries. The suit also claims that the defendants failed to disclose material flaws in the quality systems at a manufacturing facility in Ohio, where orthopedic surgical products are made.
The basis of the claim is that Zimmer’s material misrepresentation of facts about the firm and its products during the class period caused their common stock to trade at artificially inflated levels. Following the July 22 announcement that Zimmer Durom cup sales were being suspended, the price of the Zimmer stock declined from $70.88 to $66.01 per share in a single day.
Since it was approved in 2006 for use in the United States, the Durom Acetabular Component has been implanted in over 12,000 Americans. The decision to halt sales was made several months after Zimmer first became aware that a large number of doctors were encountering post hip surgery loosening of the implant parts, often requiring revision surgery.
Zimmer is continuing to maintain that there are no product defects or manufacturing irregularities with their hip implant. Rather, they have stated that the technology involved in their Durom Cup requires special surgical techniques that are not commonly used in the United States. Therefore, they have indicated that they intend to re-introduce the Zimmer Durom Cup components after revised instructions are developed and special surgical training programs are implemented in the United States.
A number of hip replacement patients who have experienced problems after surgery have already contacted Zimmer Durom Cup lawyers who are investigating individual lawsuits against the company. The Zimmer class action suit which has been filed on behalf of shareholders would not provide any compensation for victims who were unknowingly given a hip implant by doctors who were not properly instructed on the correct surgical techniques.