Intuitive Surgical, Inc. (ISRG) Faces New Lawsuit

Intuitive Surgical, Inc. (ISRG) Faces New Lawsuit

Intuitive Surgical, Inc. (NASDAQ:ISRG) is facing another lawsuit involving its da Vinci robotic surgical system. The company is already facing a number of complaints against it in connection with injuries and deaths linked to the device.

The City of Birmingham Relief and Retirement System filed a shareholder derivative complaint against Intuitive Surgical, Inc. (NASDAQ:ISRG) for allegedly breaching its fiduciary duties. The lawsuit was filed in the U.S. District Court of Northern California.

ValueWalk’s August 2021 Hedge Fund Update: Point72 Suffers Loss; Hedge Fund Assets Hit $4 Trillion

Welcome to our latest issue of ValueWalk’s hedge fund update. Below subscribers can find an excerpt in text and the full issue in PDF format. Please send us your feedback! Featuring Point72 Asset Management losing about 10% in January, Millennium Management on a hiring spree, and hedge fund industry's assets under management swell to nearly Read More

Details of the lawsuit

According to shareholders, the management and board of the company failed to fully report unfavorable events linked to the robotic surgical device to the United States Food and Drug Administration (FDA), downplayed the severity of some situations, and concealed recalls from the regulator.

In its lawsuit, the City of Birmingham Relief and Retirement System argued that the board and management of the company failed to make a good faith effort to ensure that it is in compliance with applicable laws and FDA regulations governing the safety of medical devices designed to protect the health of the American public.

The shareholders stated that board and management of Intuitive Surgical, Inc. (NASDAQ:ISRG) “grossly under-report adverse events and complications caused by da Vinci” surgical device, mis-characterized the events it reported by improperly classifying many situations as “benign category” instead of a “serious injury or even death.”

Furthermore, the City of Birmingham Relief and Retirement System stated that Intuitive Surgical, Inc. (NASDAQ:ISRG) concealed from the FDA at least three voluntary recalls it initiated to warn hospitals regarding a potential malfunction of the tip cover of the da Vinci surgical system that would result in burning the internal tissue of a patient.

Insider trading allegations

The City of Birmingham Relief and Retirement System also accused Intuitive Surgical CEO, Gary Guthart, Chairman Lonnie Smith, and CFO Marshall Mohr of insider trading of approximately $113 million worth of ISRG shares.

According to the complaint, the executives were allowed to “sell massive percentages of their holdings in Intuitive Surgical, Inc. (NASDAQ:ISRG) at the time when the stock was trading at an artificially inflated value.”

Other lawsuits against Intuitive Surgical

The Illinois Union Insurance Co. and the Navigators Specialty Insurance Co. also filed lawsuits against Intuitive Surgical, Inc. (NASDAQ:ISRG) in connection with the da Vinci surgical system.

The da Vinci surgical system uses a “targeted electrical charge to cut and cauterize a patient’s tissue during a surgery.” The FDA initially approved the device for gallbladder and gastro-esophageal surgery and other laparoscopic operations.

No posts to display