IMSS Bribery Case Against Zimmer Biomet Headed to 7th Circuit

On Feb. 4, the Instituto Mexicano del Seguro Social (IMSS) filed a notice to appeal a Jan. 5 decision by Judge Damon R. Leichty of the Northern District of Indiana that ruled to dismiss a case against Zimmer Biomet Holdings alleging that it paid bribes to push Mexican government officials to facilitate the movement of Zimmer Biomet medical device products into Mexico. The case will now be heard before the Seventh Circuit.

In its complaint, IMSS claimed that Zimmer Biomet officials, through subsidiary Biomet 3i, traveled to Mexico to act “as bagmen for passing on bribes to Mexican government officials” so that they would allow the import of Zimmer Biomet’s unregistered medical devices. The plaintiff padded its argument with Zimmer Biomet’s history of operating bribery schemes, namely in 2017 when the company settled for more than $30 million with the U.S. Department of Justice and the Securities and Exchange Commission to resolve investigations that found it was using a third-party broker to bribe Mexican officials for importing unregistered dental products.

Law Street Media previously reported that the Northern District of Indiana ruled to dismiss based on forum non-conveniens, asserting that the litigation would be more suited to take place in Mexico. The judge argued that a Mexican court would have jurisdiction to hear the case, as “IMSS’s claims are rooted in Mexican law, the contract was between Mexican parties, and the injury took place in Mexico.” Further, with more witnesses residing there and the fact of travel difficulties during the COVID-19 pandemic, the matter should be litigated in Mexico, according to the judge.

IMSS is represented by Maney & Gonzalez-Felix. Zimmer Biomet is represented by Morgan, Lewis & Bockius.