Cybex International is analyzing its legal and financial options related to a recent decision against it in a product liability case. However, the company’s first step is to file an appeal with the New York State Supreme Court, Art Hicks, president and COO of Cybex, Medway, MA, said in a call with analysts and shareholders Tuesday.

Last week, an appellate court handed down a decision upholding a December 2010 judgment against Cybex in the Barnhard v. Cybex International case in which the plaintiff, Natalie Barnhard, originally was awarded $66 million. In 2004, Barnhard, a physical therapist at Amherst Orthopedic Physical Therapy, Buffalo, NY, was stretching her shoulder using a Cybex leg extension machine. The machine fell over on her, rendering her a quadriplegic. Cybex was deemed 75 percent liable in the case but appealed the decision. The appellate court upheld the original decision last week, but it reduced the award amount to about $44 million.

“The good news is the judgment was reduced by approximately $21 million,” Hicks said. “The bad news is that the reduced amount is still an absurdly large amount. And the fact remains that Cybex was not at fault.”

Hicks would not comment on whether any settlement discussions had occurred.

“The first priority is appealing to the New York State Supreme Court,” Hicks said. “Then, the next step would be to figure out the funding for various options from paying zero to 100 percent of the ultimate judgment. Along the way, settlement is a possibility, but we have nothing to disclose at this time.”

When asked whether he thought the plaintiff’s lawyers were advising the plaintiff about how detrimental it would be to her receipt of the award if this judgment caused Cybex to file for bankruptcy, Hicks initially would not comment, but he then said, “We hope they realize that it is self-defeating to cause the company any difficulty. And I can only speculate that they’ve considered these issues.”

Hicks would not comment on how much the company would be able to pay in a possible settlement.

“We have significant financial resource at our disposal,” Hicks said. “We are working with Citizens Bank. We will look at other financing options, so it is a little too early to say. There’s a variety of moving points at this time.”

He continued by saying that the state court can choose to hear the case or not hear it. If it does hear the case, it can affirm the original judgment and award or it could reduce it or it could call for a retrial.

CONTINUED ON NEXT PAGE

Want to use this article? Click here for options!
© 2012 Penton Media Inc.