Federal Court awards AngioScore US$20m plus disgorgement in breach of fiduciary duty case

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The US District Court for the Northern District of California has ruled in favour of Spectranetics’ wholly-owned subsidiary, AngioScore, in a lawsuit filed by AngioScore seeking damages for breach of fiduciary duty against Eitan Konstantino, a former board member of AngioScore and founder of TriReme Medical, Quattro Vascular and QT Vascular.

The Court found that Konstantino breached his fiduciary duties to AngioScore, that TriReme and Quattro aided and abetted that breach, and that QT Vascular is liable for the acts of TriReme and Quattro. The Court awarded AngioScore US$20m against all defendants plus disgorgement from Konstantino of all benefits he accrued from his breach of fiduciary duties, including amounts he received for assigning his intellectual property rights to the Chocolate balloon, a royalty on past and future sales of the Chocolate balloon, and all of his shares and options in QT Vascular. Under the indemnification agreement between AngioScore and Konstantino, AngioScore will seek to recover attorney fees and costs previously advanced to Konstantino.

In its ruling, the Court found that Konstantino, a former co-founder, officer and member of the board of directors of AngioScore, breached his fiduciary duties to AngioScore by developing the Chocolate balloon catheter while serving on the AngioScore board and failing to present that corporate opportunity to AngioScore. Konstantino subsequently launched the product through TriReme, Quattro and QT Vascular. Spectranetics acquired AngioScore in June 2014.

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