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VOL. 126 | NO. 78 | Thursday, April 21, 2011

Ex-Smith & Nephew Workers Push Back

By Andy Meek

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Smith & Nephew now has to deal with countercomplaints filed by some of the nine employees the company fired last month after the company claimed they were planning to resign together, start their own company and use Smith & Nephew trade secrets.

At least one of the employees is pursuing a libel-focused strategy. Others say the London-based medical device manufacturer – the orthopedics unit of which is based in Memphis – still owes them money.

Smith & Nephew fired all nine employees, including several engineers, managers, their department supervisor and a director. The company then filed a lawsuit in Shelby County Chancery Court.

Smith & Nephew included in its complaint an affidavit from an employee who said the entire team working on the company’s Visionaire product “had been planning to stage a mass resignation and start a new company.” It also was believed the group would use confidential information to offer consulting services to Smith & Nephew and eventually to its competitors.

One of the fired employees, Bonnie Walker, has filed a counterclaim against Smith & Nephew over its accusations against her.

“On or about March 11, (Smith & Nephew) decided, incorrectly, that Ms. Walker had participated in the wrongful acts alleged in its original complaint against Ms. Walker,” her countercomplaint reads. “(Smith & Nephew) thereupon published written statements outside the pleadings in this action in which Smith & Nephew expressly accused Ms. Walker of a crime – to wit, stealing.

“As a result, Smith & Nephew has committed libel per se, for which Ms. Walker is entitled to recover actual, consequential and exemplary damages.”

Walker’s counterclaim also asserts Smith & Nephew has not paid an unspecified sum of money it owes her “pursuant to her employment contract.”

Other counterclaims from the fired employees similarly assert that they are owed money.

“On or about March 11, (Smith & Nephew) concluded, incorrectly and without first properly investigating the matter, that Mr. Wald had participated in the wrongful acts alleged in its original complaint,” reads a counterclaim from Andrew Wald.

His counterclaim goes on to say Smith & Nephew “converted” funds from his bank account and failed to pay additional money owed to him.

Ashley Deken filed a counterclaim similar in wording to Wald’s. She also filed an affidavit in which she emphatically denied taking part in any improper scheme.

“I have not engaged in the conduct in which Smith & Nephew has accused me,” Deken said in the affidavit. “I have not misappropriated or disseminated any trade secrets belonging to Smith & Nephew.”

Smith & Nephew’s lawsuit asks for $56 million in damage-related costs, plus other relief. It also asked for a temporary injunction against the employees to prevent them from improperly using any confidential company information.

In a statement issued by the company, Smith & Nephew said: “We have taken this legal action in order to prevent further attempts to steal intellectual property and to ensure they cannot use Smith & Nephew confidential information for personal benefit. The former employees consisted of eight engineers and an operations manager who worked together on a project at our Brooks Road facility.”

Smith & Nephew employs more than 2,000 people in Memphis and has a new 285,000-square-foot headquarters at 7216 Goodlett Farms Road in East Memphis.

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