3M 2011 Annual Report Download - page 114

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108
Separately, several purported holders of Cogent shares, representing a total of approximately 5.8 million shares,
have asserted appraisal rights under Delaware law. The Company has answered the appraisal petition and is
defending this matter vigorously.
3M filed suit against Avery Dennison Corporation in the United States District Court for the District of Minnesota in
June 2010, alleging that Avery’s OmniCube™ full cube retroreflective sheeting products, which are used for highway
signage, infringe a number of 3M patents. 3M’s motion to preliminarily enjoin the sales of Avery’s OmniCube
retroreflective sheeting was denied in December 2010. 3M also sought a declaratory judgment from the District Court
in Minnesota that 3M’s Diamond Grade™ DG3 full cube retroreflective sheeting does not infringe two Avery patents.
The District Court granted Avery’s motion to dismiss 3M’s declaratory judgment suit in March 2011. 3M has appealed
the dismissal of the declaratory judgment lawsuit and expects a decision from the appellate court during the first half
of 2012. In October 2010, Avery Dennison filed a lawsuit against the Company in the United States District Court for
the Central District of California, alleging that 3M monopolized or attempted to monopolize the markets for Type XI
retroreflective sheeting and for broad high performance sheeting in violation of the Sherman Act, as well as other
claims. Avery alleges that 3M manipulated the standards-setting process of the American Society for Testing and
Materials (ASTM), a private organization responsible for creating standards for, among other things, retroreflective
sheeting used for highway signage; entered into illegal and anticompetitive contracts; and engaged in other
anticompetitive acts including false advertising and disparagement. 3M’s motion to transfer the antitrust case to the
United States District Court for the District of Minnesota was granted in February 2011. 3M’s patent infringement
lawsuit against Avery and Avery’s antitrust suit against 3M are moving forward in the Minnesota Court.
In December 2010, Meda AB filed a lawsuit in the Supreme Court of the State of New York, County of New York,
alleging breach of certain representations and warranties contained in the October 2006 acquisition agreement
pursuant to which Meda AB acquired the Company’s European pharmaceutical business. The lawsuit seeks to
recover an amount to be determined at trial, but not less than $200 million, in compensatory damages alleging that
3M failed to disclose, during the due diligence period, certain pricing arrangements between 3M’s French subsidiary
and the French government agency that determines the eligible levels of reimbursement for prescription
pharmaceuticals. The damage amounts specified in complaints are not a meaningful factor in any assessment of the
Company’s potential liability. The Company believes it has a number of legal and factual defenses to this claim and
will vigorously defend it.
In December 2008, the investors that sold Acolyte Biomedica, Ltd. to the Company’s subsidiary in the United
Kingdom filed suit in London’s High Court seeking damages for breach of the acquisition agreement, including
damages of 40 million pounds sterling for loss of potential earnout payments under the acquisition agreement.
Notwithstanding significant investments and efforts by the Company to support the sales of BacLite™, a methicillin-
resistant staphlococcus aureus (MRSA) screening device, the product was not a commercial success. A trial in
London’s High Court took place from June 15 to July 18, 2011. On November 7, 2011, the High Court issued a
judgment rejecting the bulk of Claimants’ damages claim and awarded Claimants $1.3 million.
For commercial litigation matters described in this section for which a liability, if any, has been recorded, the
Company believes the amount recorded, as well as the possible loss or range of loss in excess of the established
reserve is not material to the Company’s consolidated results of operations or financial condition. For those matters
for which a liability has not been recorded, the Company believes that such liability is not probable and estimable and
the Company is not able to estimate a possible loss or range of loss at this time.