A New Jersey appeals court has upheld a $2.7 million judgement against two subsidiaries of Biomet over royalties they stopped paying a spine surgeon.

Electro-Biology Inc. and EBI LCC have been ordered to pay $2.7 million to prominent spine surgeon Dr. Neil Kahanovitz. In 2008, according to Mass Device, Kahanovitz, the former president of the North American Spine Society, sued Biomet units Electro-Biology Inc. and EBI LLC winning a breach of contract claim on appeal in 2011. He’d inked a royalties deal worth $250,000 a year in 1992, but stopped actively consulting for them in 2008, according to the decision by the New Jersey Superior Court’s Appellate Division.

The contract called for the payments to continue “during the term of this agreement and for so long as Kahanovitz is performing services within the agreement field,” according to the appeals court, with the contract set to expire in November 2008.

“The issue is whether the annual $250,000 payment was due even after the Nov. 30, 2008, date referenced in the 2004 Agreement so long as Kahanovitz continued to practice as an orthopedic surgeon,” according to court documents.

The court agreed with Kahanovitz that the lower court was correct in considering the testimony of the Electro-Biology and EBI executives who made the deal with the surgeon, according to the documents. Then-EBI CEO James Pastena told the lower court that the agreement was meant to reward Kahanovitz for as long as he practiced in the spine surgery field.

Source: Mass Device.com