Varian Settles Patent Case with University of Pittsburgh

Varian Medical Systems Inc. has settled a patent litigation with the University of Pittsburgh.

The company will pay a lump sum of approximately $35 million to fully settle this matter. The company said the settlement mostly will be recorded in the financial results for the second and third quarters of fiscal year 2014. 

The University of Pittsburgh initiated a patent infringement lawsuit against Varian in 2007 regarding the company’s Real-time Position Management technology, which is used to account for breathing motion during delivery of radiation therapy. In 2012, the United States District Court for the Western District of Pennsylvania ruled against Varian, ordering payment of approximately $102 million in damages, enhanced damages, interest and fees as well as ongoing royalty payments.

Varian challenged that ruling in the United States Court of Appeals for the Federal Circuit, which published its opinion on April 10. 

During the second quarter of fiscal year 2014, Varian and the university reached a settlement agreement that was dependent upon today’s ruling from the appeals court. Under this pre-negotiated settlement, Varian would not owe any future royalty payments associated with the sale of Varian products that incorporate the patent at issue. Varian customers will continue to have full use of these products, the company said.

Varian Medical is based in Palo Alto, Calif., and makes medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery and brachytherapy.