As seen on Forbes.com. (PDF)
Simmons Hanly Conroy LLC of East Alton, Illinois, today announced the resolution of their client Synergetics USA, Inc.’s (Nasdaq: SURG) antitrust lawsuit pending against Alcon Laboratories, Inc. and Alcon, Inc. Synergetics announced on April 27, 2010 that it had entered into a Settlement and Licensing Agreement and a Supply Agreement with Alcon, pursuant to which all litigation between the companies would be settled and Alcon would receive a license to sell certain Synergetics-patented products. Alcon will pay Synergetics $32 million in the arrangement.
A small team of lawyers from Simmons Hanly Conroy collaborated to represent Synergetics in the antitrust litigation. In a unique approach to commercial litigation, the firm took on the high-risk litigation under a contingency fee arrangement, whereby Synergetics would pay attorneys’ fees only as a percentage of any recovery in the case. Traditionally, commercial litigation is pursued by outside counsel paid at ever-increasing hourly rates.
“High-end litigation, particularly in a field like antitrust, typically commands exorbitant hourly billing rates for lawyers,” said Derek Brandt, Simmons Hanly Conroy partner who spearheaded the firm’s efforts in the case. “Our willingness to take the case on a contingency basis meant that a relatively small company like Synergetics could pursue a high-stakes litigation against an infinitely larger competitor. We shared the risk with our client and reached a very gratifying result.” Under the contingent fee agreement, Synergetics will pay its outside counsel $10.5 million.
This arrangement reflects the increasing comfort level of corporate general counsels in using plaintiff-only contingent fee attorneys to pursue commercial litigation. Trading in Synergetics stock was reported up as much as 72% on the day after the announcement.
Synergetics and Alcon compete in the sale of light sources and instruments and tools used in vitreoretinal surgery, a highly specialized area of ophthalmological surgery focusing on procedures in the posterior (back) portion of the eye. Surgeons use a primary piece of equipment known as a vitrectomy machine to perform vitreoretinal procedures.
Lawyers from Simmons Hanly Conroy filed the antitrust lawsuit in the United States District Court for the Southern District of New York in April, 2008. The suit alleged that Alcon engaged in certain anti-competitive conduct in the market for vitreoretinal surgical equipment and supplies. Synergetics’ allegations included that Alcon used the market power enjoyed by its vitrectomy machine in an unlawful manner, forcing surgeons to purchase from Alcon the ancillary instruments, tools, and external light sources used in vitreoretinal surgeries. Most notably, Synergetics alleged that Alcon unlawfully tied the sale of its fiberoptic illuminator to the sale of single-use disposable cassettes necessary to operate the Alcon vitrectomy machine.
The case was Synergetics USA, Inc. v. Alcon Laboratories, Inc. and Alcon, Inc., 2008-cv-3669 (DLC).
The Simmons Hanly Conroy worked closely with co-counsel Hanly Conroy Bierstein Sheridan Fisher & Hayes LLP of New York, New York.
More about the Synergetics Anti-Trust Lawsuit
Synergetics, Alcon ink $32M licensing deal, settle suit (PDF) – St. Louis Business Journal
Synergetics files suit against Alcon, seeks recovery of $100M – St. Louis Business Journal