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Item 3. Legal Proceedings

2021-03-30 compared with 2020-03-16 · 76 added, 103 removed, 22 unchanged (89% of the section changed)

Legal Proceedings

On September 9, 2014,

we filed in the District Court of Mannheim, Germany a patent infringement action against TauroPharm GmbH and Tauro-Implant GmbH

as well as their respective CEOs, referred to as the Defendants claiming infringement of our European Patent EP 1 814 562 B1,

which was granted by the EPO on January 8, 2014, or the Prosl European Patent.

The Prosl European Patent covers a low dose heparin

catheter lock solution for maintaining patency and preventing infection in a hemodialysis catheter.

In this action, we claim that

the Defendants infringe on the Prosl European Patent by manufacturing and distributing catheter locking solutions to the extent

they are covered by the claims of the Prosl European Patent.

We believe that our patent is sound and are seeking injunctive relief

and raising claims for information, rendering of accounts, calling back, destruction and damages.

Separately, TauroPharm has filed

an opposition with the EPO against the Prosl European Patent alleging that it lacks novelty and inventive step.

We cannot predict

what other defenses the Defendants may raise, or the ultimate outcome of either of these related matters.

At present, the EPO

has revoked the Prosl European Patent as invalid, and we have filed an appeal, which is currently pending.

the same complaint against the same Defendants, we also alleged an infringement (requesting the same remedies) of NDP’s

September 9, 2014, we filed in the District Court of Mannheim, Germany a patent infringement action against TauroPharm GmbH and

Tauro-Implant GmbH as well as their respective CEOs, referred to as the Defendants, claiming infringement of our European Patent

EP 1 814 562 B1, which was granted by the EPO on January 8, 2014, or the Prosl European Patent.

The Prosl European Patent covers

a low dose heparin catheter lock solution for maintaining patency and preventing infection in a hemodialysis catheter.

action, we claim that the Defendants infringe on the Prosl European Patent by manufacturing and distributing catheter locking

solutions to the extent they are covered by the claims of the Prosl European Patent.

We believe that our patent is sound and are

seeking injunctive relief and raising claims for information, rendering of accounts, calling back, destruction and damages.

TauroPharm has filed an opposition with the EPO against the Prosl European Patent alleging that it lacks novelty and inventive

We cannot predict the ultimate outcome of either of these related matters.

At present, the EPO has revoked the Prosl European

Patent as invalid, and we have filed an appeal, which is currently pending.

the same complaint against the same Defendants, we also alleged an infringement (requesting the same remedies) of NDP’s

utility model DE 20 2005 022 124 U1, referred to as the Utility Model, which we believe is fundamentally identical to the Prosl

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The Court separated the two proceedings and the Prosl European Patent and the

Utility Model claims are now being tried separately.

TauroPharm has filed a cancellation action against the Utility Model before

the German Patent and Trademark Office, or German PTO based on the similar arguments as those in the opposition against the Prosl

European Patent.

March 27, 2015, the District Court held a hearing to evaluate whether the Utility Model has been infringed by TauroPharm in connection

with the manufacture, sale and distribution of its TauroLock-HEP100TM and TauroLock-HEP500TM products.

A hearing before the same

court was held on January 30, 2015 on the separate, but related, question of infringement of the Prosl European Patent by TauroPharm.

Utility Model claims were tried separately.

TauroPharm has filed a cancellation action against the Utility Model before the German

Patent and Trademark Office, or German PTO based on the similar arguments as those in the opposition against the Prosl European

Court issued its decisions on May 8, 2015, staying both proceedings.

10 unchanged sentences

such time as the EPO or the German PTO made a final decision on the underlying validity of the Prosl European Patent and the Utility

It is safe to assume that the complaint regarding the infringement of the Utility Model will be dismissed now that the

German PTO has voided the Utility Model (see below).

This does, however, not have a direct effect on the infringement proceedings

concerning the Prosl European Patent.

opposition proceeding against the Prosl European Patent before the EPO is ongoing.

In its preliminary consideration of the matter,

the EPO (and the German PTO) regarded the patent as not inventive or novel due to publication of prior art.

Oral proceedings before

the Opposition Division at the EPO were held on November 25, 2015, at which the three-judge patent examiner panel considered arguments

related to the validity of the Prosl European Patent.

The hearing was adjourned due to the fact that the panel was of the view

that Claus Herdeis, one of the managing directors of TauroPharm, has to be heard as a witness in a further hearing in order to

close some gaps in the documentation presented by TauroPharm as regards the publication of prior art.

Oral proceedings before the Opposition Division

at the EPO were held on November 25, 2015, at which the three-judge patent examiner panel considered arguments related to the

validity of the Prosl European Patent.

The hearing was adjourned due to the fact that the panel was of the view that Claus Herdeis,

one of the managing directors of TauroPharm, had to be heard as a witness in a further hearing in order to close some gaps in

the documentation presented by TauroPharm as regards the publication of prior art.

German PTO held a hearing in the validity proceedings relating to the Utility Model on June 29, 2016, at which the panel affirmed

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We filed an appeal against the ruling on September 7, 2016.

An oral hearing was held on September 17, 2019 in which the German Federal Patent affirmed the first instance decision that the

Utility Model was invalid.

An oral hearing was held on September 17, 2019 in which the German Federal Patent Court affirmed the first instance decision that

the Utility Model was invalid.

The decision has only a declaratory effect, as the Utility Model had expired in November 2015.

October 2016, TauroPharm submitted a further writ to the EPO requesting a date for the hearing and bringing forward further arguments,

in particular in view of the June 2016 decision of the German PTO on the invalidity of the utility model.

On November 22, 2017,

the EPO in Munich, Germany held a further oral hearing in this matter.

At the hearing, the panel held that the Prosl European

Patent would be invalidated because it did not meet the requirements of novelty based on a technical aspect of the European intellectual

property law.

We disagree with this decision and, after the written opinion was issued by the Opposition Division in September

2018, have appealed the decision.

We continue to believe that the Prosl European Patent is indeed novel and that its validity

should be maintained.

There can be no assurance that we will prevail in this matter.

In addition, the ongoing Unfair Competition

litigation against TauroPharm is not affected and will continue.

On January 16, 2015,

we filed a complaint against TauroPharm GmbH and its managing directors in the District Court of Cologne, Germany.

In the complaint,

we allege violation of the German Unfair Competition Act by TauroPharm for the unauthorized use of our proprietary information

obtained in confidence by TauroPharm.

We allege that TauroPharm is improperly and unfairly using our proprietary information relating

to the composition and manufacture of Neutrolin, in the manufacture and sale of TauroPharm’s products TauroLockTM, TauroLock-HEP100

and TauroLock-HEP500.

We seek a cease and desist order against TauroPharm from continuing to manufacture and sell any product

containing taurolidine (the API of Neutrolin) and citric acid in addition to possible other components, damages for any sales

in the past and the removal of all such products from the market.

An initial hearing in the District Court of Cologne, Germany

was held on November 19, 2015 to consider our claims.

The judge made no decision on the merits of our complaint.

On January 14,

2016, the court issued an interim decision in the form of a court order outlining several issues of concern that relate primarily

to the court’s interest in clarifying the facts and reviewing any and all available documentation, in particular with regard

to the question which specific know-how was provided to TauroPharm by whom and when.

We have prepared the requested reply and

produced the respective documentation.

TauroPharm has also filed another writ within the same deadline and both parties have filed

further writs at the end of April 2016 setting out their respective argumentation in more detail.

A further oral hearing in this

matter was held on November 15, 2016.

In this hearing, the court heard arguments from CorMedix and TauroPharm concerning the allegations

of unfair competition.

The court made no rulings from the bench and indicated that it is prepared to further examine the underlying

facts of our allegations.

On March 7, 2017, the court issued another interim decision in the form of a court order outlining again

several issues relating to the argumentation of both sides in the proceedings.

In particular the court requested us to further

specify our requests and to further substantiate in even more detail which know-how was provided by Biolink (the company who developed

Neutrolin that was acquired by ND Partners) to TauroPharm by whom and when.

The court also raised the question whether the know-how

provided at the time to TauroPharm could still be considered to be secret know-how or may have become public in the meantime.

The court granted both sides the opportunity to reply to this court order and provide additional facts and evidence until May

Both parties have submitted further writs in this matter and the court had scheduled a further hearing for May 8, 2018.

On April 28, 2020, we filed a withdrawal of the complaint on the German utility model, thereby waiving our claims on these proceedings.

During the year ended December 31, 2020, costs in connection with the utility model infringement proceedings of approximately

$30,000 was reimbursed to TauroPharm .

November 22, 2017, the EPO in Munich, Germany held a further oral hearing in this matter.

At the hearing, the panel held that

the Prosl European Patent would be invalidated because it did not meet the requirements of novelty based on a technical aspect

of the European intellectual property law.

We disagree with this decision and have appealed the decision.

We continue to believe

that the Prosl European Patent is indeed novel and that its validity should be maintained.

There can be no assurance that we will

prevail in this matter.

In addition, the ongoing Unfair Competition litigation against TauroPharm is not affected and will continue.

January 16, 2015, we filed a complaint against TauroPharm GmbH and its managing directors in the District Court of Cologne, Germany.

In the complaint, we allege violation of the German Unfair Competition Act by TauroPharm for the unauthorized use of our proprietary

information obtained in confidence by TauroPharm.

We allege that TauroPharm is improperly and unfairly using our proprietary information

relating to the composition and manufacture of Neutrolin, in the manufacture and sale of TauroPharm’s products TauroLockTM,

TauroLock-HEP100 and TauroLock-HEP500.

We seek a cease and desist order against TauroPharm from continuing to manufacture and

sell any product containing taurolidine (the API of Neutrolin) and citric acid in addition to possible other components, damages

for any sales in the past and the removal of all such products from the market.

An initial hearing in the District Court of Cologne,

Germany was held on November 19, 2015 to consider our claims.

On January 14, 2016, the Court issued an interim decision in the

form of a court order outlining several issues of concern that relate primarily to the court’s interest in clarifying the

facts and reviewing any and all available documentation, in particular with regard to the question which specific know-how was

provided to TauroPharm by whom and when.

A further oral hearing in this matter was held on November 15, 2016.

In this hearing,

the Court heard arguments from CorMedix and TauroPharm concerning the allegations of unfair competition.

On March 7, 2017, the

Court issued another interim decision in the form of a court order outlining again several issues relating to the argumentation

of both sides in the proceedings.

Both parties have submitted further writs in this matter and the Court had scheduled a further

hearing for May 8, 2018.

After having been rescheduled several times, the hearing took place on November 20, 2018.

A decision was rendered by the court

on December 11, 2018, dismissing the complaint in its entirety.

However, we intend to continue to pursue this matter, and still

believe firmly that our claims are well-founded.

We have therefore appealed in January 2019 and filed our grounds of appeal in

An oral hearing was held on September 6, 2019 in which our legal counsel brought forward further arguments for the

fact that the manufacturing process of the respective catheter locking solution is indeed protectable as a trade secret.

of these new arguments, the court issued an evidentiary order on September 27, 2019 ordering an expert opinion.

Next steps will

be taken after the receipt of the expert opinion.

Mine Safety Disclosures

was rendered by the Court on December 11, 2018, dismissing the complaint in its entirety.

However, we intend to continue to pursue

this matter, and still believe firmly that our claims are well-founded.

We have therefore appealed in January 2019 and filed our

grounds of appeal in March 2019.

An oral hearing was held on September 6, 2019 in which our legal counsel brought forward further

arguments for the fact that the manufacturing process of the respective catheter locking solution is indeed protectable as a trade

In view of these new arguments, the Court issued an evidentiary order on September 27, 2019 ordering an expert opinion.

The expert opinion was not in our favor, but we have filed a response to the expert opinion in reaction to which the Court asked

the expert to supplement his opinion to address the issues brought forward in our submission.

In the supplementary expert opinion,

the expert confirmed his view.

We have filed another response and an oral hearing has been scheduled for February 5, 2021 but

was postponed to June 18, 2021 due to the COVID-19 situation in Germany.

Safety Disclosures

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 3. Legal Proceedings