A permanent injunction was issued in Seattle Federal Court last month enforcing a binding arbitration decision in ATL's deceptive marketing practices lawsuit against ultrasound competitor Acuson.
Although both companies are enjoined from certain sales and marketing activities, the arbitrator decided largely in favor of ATL. ATL was awarded $6.3 million plus legal fees in the dispute (SCAN 1/16/91).
The injunction requires Acuson to send a letter to its customers within 30 days, acknowledging that it does not have inside information on ATL's product development plans. A central charge in ATL's suit, filed two years ago, was that Acuson had spread the word among ultrasound users that ATL planned to obsolete its high-end Ultramark 9 system with a radically different UM 10 unit.
"I don't foresee that this injunction is going to have any impact on our business or customers," said Samuel H. Maslak, Acuson president and CEO.
Appropriately enough, considering the nature of this dispute, Acuson took issue with statements made by ATL in a press release announcing the injunction.
"I think the press release mischaracterizes the injunction significantly. It is inappropriate for ATL to engage in that type of mischaracterization, especially at this late date after the arbitrator's decision was made," Maslak said.
Acuson contests three statements made by ATL in its description of the injunction:
There are 26 provisions against Acuson in the injunction, but they are mostly narrow prohibitions against the use of certain statements, Maslak said. Half of those statements came from two letters written by Acuson sales representatives, which the vendor has acknowledged were improper.
ATL said it had proved that this advertisement "did not fairly or accurately represent the respective image quality of these competing systems."
"We argued that the phantom images were accurate and that Acuson stood behind their accuracy," Maslak said. There is no evidence that the arbitrator disagreed with that perspective. The issues centered around the ability of physicians to evaluate the types of resolution information provided by the phantom measurements."
"This was the only injunction provision in the court order directed toward ATL," the vendor said in its press release.
There were actually three provisions related to this promotional material, according to Maslak.
BRIEFLY NOTED:
GEMS is a unit of GE's Technical Products and Services industry segment. Revenues rose 5% and operating profits 1% from 1989 to 1990 in this segment. That performance was below GE's corporate-wide 7% increase in revenues and 9% increase in net earnings last year.
