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NEWS RELEASE
FOR IMMEDIATE RELEASE
VITAL SIGNS ANNOUNCES SETTLEMENT OF LAWSUIT
TOTOWA, N.J., JULY 27, 2000 -- VITAL SIGNS, INC. (NASDAQ: VITL): SIMS
Portex, Inc. ("SIMS") and Vital Signs, Inc. ("Vital Signs") have reached a
settlement in connection with litigation concerning among other things patent
property owned by SIMS. Legal proceedings have been pending in the Federal
District Court in Illinois. The products at issue in the litigation are certain
disposable manual resuscitator devices which Vital Signs sells for respiratory
therapy and other purposes.
The litigation involved issues including the validity and
enforceability of SIMS' patent relating to resuscitator devices and whether
those Vital Signs' devices infringe on SIMS' patented technology. The validity
issue was resolved in SIMS' favor by the US Court of Appeals for the Federal
Circuit.
In a commercial settlement, the parties agreed that Vital Signs would
drop its challenge to the SIMS Patent and would acknowledge the validity and
enforceability of the SIMS Patent, In turn, SIMS agreed it would not pursue its
patent infringement claims against Vital Signs. The Parties agreed to dismiss
the current action with prejudice. Vital Signs made no acknowledgement that its
products infringe the SIMS patent.
The parties also agreed among other things that SIMS would grant a
non-exclusive license to Vital Signs under the SIMS patent for the resuscitator
devices, with Vital Signs continuing to market its resuscitators without the
threat of patent infringement litigation. The other terms of the settlement are
confidential to the parties. Vital Signs said that it would report a special
charge, net of tax, of approximately $5.5 million aggregating to $0.45 per share
in its earnings for the third quarter of the current fiscal year to cover the
costs of this litigation and settlement and another infringement litigation.
SIMS and Vital Signs stated that they were pleased with the outcome of
the litigation and the resolution that was reached by the parties and that this
matter has been put behind them.
[LETTERHEAD OF VITAL SIGNS INC.]
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All statements in this press release other than historical statements
constitute Forward Looking Statements under the Private Securities Litigation
Reform Act of 1995. Actual results could differ materially from such statements
as a result of a variety of factors including unanticipated delays in bringing
products to market, market conditions, and competitive responses as well as
other factors referred to by Vital Signs in its Annual Report on Form 10-K for
the year ended September 30, 1999.
Vital Signs, Inc. and its subsidiaries design, manufacture and market
single-use medical products for anesthesia and critical care, achieving the
number one market share position in nine of its major product categories. Vital
Signs is distinguished as one of a select number of medical device firms to have
received ISO 9001 certification and CE Mark for its products.
FOR FURTHER INFORMATION, CONTACT: Terence D. Wall, President
or
Tony Dimun, Chief Financial Officer
(973) 790-1330
http://www.vital-signs.com
[LETTERHEAD OF VITAL SIGNS INC.]
