NASHVILLE (CN) – Imagine Heart Image was just a heartbeat away from profiting off of a heart-disease prevention device made by Energy-Lab Technologies, when the German manufacturer’s reckless behavior with the Food and Drug Administration cost it the U.S. market and an estimated $18 million in damages, the Tennessee company claims in Federal Court.
According to the complaint, Energy-Lab’s “cardioscan” uses black-box software to evaluate an individual’s stress levels and, when connected to a computer, can print out a basic electrocardiogram, along with an analysis of the user’s heart condition.
The device purportedly sold well in Germany and other nations, and Energy-Lab assured the plaintiff that the scanner would not require FDA approval. The plaintiff ended up buying exclusive rights to sell the cardioscans in the United States, agreeing to sell at least 5,000 units during the first five years, or pay Energy-Lab 900 euros for each unit it did not sell if it wanted to maintain exclusivity. The plaintiff said the deal was fair in light of the defendant’s success in Europe.
When representatives of Imagine Heart went to Germany to discuss further business, they were allegedly told the cardioscans should be approved by the FDA. Energy-Lab agreed to apply for approval immediately, but insisted on using a German company that was not qualified to handle the application.
Energy-Lab then turned to the counsel of Morgan Lewis & Bockius in Washington, D.C., but refused to listen to the firm’s advice and now refuses to proceed with the application altogether, the lawsuit claims.
The plaintiff demands nearly $18 million in damages.