The Cochlear Limited (ASX: COH) share price is on course to end the week in the red.
In morning trade, the hearing solutions company’s shares are down 4.5% to $226.26.
Why is the Cochlear share price tumbling lower today?
Investors have been selling down the Cochlear share price this morning after it released an announcement.
As you might have guessed from the share price reaction, the announcement wasn’t a positive one.
According to the release, a complaint has been made by the University of Pittsburgh against Cochlear for patent infringement. It has been filed by the University in United States District Court for the Western District of Texas, Waco division.
The release explains that the complaint names Cochlear and USA subsidiaries Cochlear Americas Corporation and Cochlear Clinical Services as defendants.
Cochlear to defend the lawsuit
Cochlear believes that none of its products infringe the University’s patent and will defend the lawsuit.
The company also highlights that its legacy products and related patents predate the University’s patent by several years. These earlier legacy products and patents embody the alleged invention of the patent and, accordingly, Cochlear believes the patent is invalid.
The patent in question is related to a wireless energy transfer system. It was filed at the US Patent Office in 2009 and will expire in 2030.
The company also advised that the lawsuit is not expected to disrupt Cochlear’s business or customers in the United States.
While the company appears confident in its ability to defend the lawsuit, the Cochlear share price performance would indicate that the market has a few niggling doubts.
Which is understandable given its multi-year courtroom battle with the Alfred E. Mann Foundation for Scientific Research (AMF) and Advanced Bionics (AB).
Late last year the company was ordered to pay AMF and AB US$280 million in patent infringement damages following a six-year legal dispute.
Cochlear shareholders will be hoping this latest patent infringement complaint doesn’t end up the same way.