Exhibit I...MEPILEX Border dressings involved over 300 participants. 15. One of the RCTs conducted...

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Exhibit I

Case 1:17-cv-01238-TWT Document 25-1 Filed 10/13/17 of 45

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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA

ATLANTA DIVISION

MÖLNLYCKE HEALTH CARE US, LLC,

Plaintiff,

vs. SMITH & NEPHEW, INC.,

Defendant.

No. 1:17-CV-01238-TWT Jury Trial Demanded

MÖLNLYCKE’S FIRST AMENDED COMPLAINT

Plaintiff Mölnlycke Health Care US, LLC (“Mölnlycke”), files this

First Amended Complaint and Jury Demand against defendant Smith

& Nephew, Inc. (“Smith & Nephew”). In support thereof, Mölnlycke

respectfully shows as follows:

OVERVIEW

1. Each year more than 2.5 million people in the U.S. develop

pressure injuries, resulting in 60,000 patient deaths. In addition to

causing unnecessary patient pain, suffering, and mortality, pressure


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ulcers are costly for hospitals due to longer stays, denial of payment,

and potential litigation. Management of pressure ulcers costs the U.S.

healthcare system between $9.1 billion to $11.6 billion annually.

Mölnlycke was one of the first companies to offer prophylactic dressings

to help prevent pressure ulcers rather than just treat them after they

occur. It has supported extensive research including several randomized

controlled trials to test and demonstrate that its MEPILEX Border

dressings help prevent pressure ulcers. A latecomer in this area, Smith

& Nephew has made false, misleading, and unsubstantiated advertising

claims, including those which compare its ALLEVYN Life dressings to

Mölnlycke’s MEPILEX Border dressings. These advertisements injure

Mölnlycke, but more importantly, put patients at risk of unnecessary

suffering and death. For this reason, Mölnlycke pursues this action to

stop Smith & Nephew’s false, misleading, and unsubstantiated

advertising.

NATURE OF THE ACTION

2. Mölnlycke brings this action for false advertising under

Section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. § 1125(a), the Georgia


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Uniform Deceptive Trade Practices Act, O.C.G.A. § 10-1-370 et seq., and

unfair competition under O.C.G.A. § 23-2-55 and the common law.

Mölnlycke seeks all available legal and equitable remedies, including

damages, restitution, disgorgement, and injunctive relief.

PARTIES

3. Plaintiff Mölnlycke Health Care US, LLC is a limited

liability company organized and existing under the laws of the State of

Delaware with its principal place of business located in Norcross,

Georgia, within this judicial district.

4. Defendant Smith & Nephew, Inc. is a corporation organized

and existing under the laws of the State of Delaware and having a

principal place of business at 1450 E. Brooks Road, Memphis,

Tennessee 38116.

JURISDICTION AND VENUE

5. This Court has subject matter jurisdiction over this action

pursuant to 15 U.S.C. § 1121(a) (action arising under the Lanham Act)

and 28 U.S.C. § 1331 (action arising under the laws of the United


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States), § 1338(a) (action arising under the Lanham Act), § 1338(b)

(action asserting claim of unfair competition joined with substantial and

related claim under the Lanham Act), and § 1367 (supplemental

jurisdiction).

6. This Court has personal jurisdiction over Smith & Nephew,

and venue is proper within this judicial district pursuant to 28 U.S.C. §

1391. Smith & Nephew is registered with the Georgia Secretary of State

to do business in Georgia. Smith & Nephew’s registered agent in

Georgia for service of process is CT Corporation System, 1201 Peachtree

Street, Suite 1240, Atlanta, Georgia 30361. Smith & Nephew does

business in Georgia and this district, selling, inter alia, ALLEVYN

wound dressings and other products. Smith & Nephew has also placed

many of the false or misleading advertisements and promotional

communications that are the subject of this action into interstate

commerce and sent them into this judicial district, where they have

caused foreseeable harmful commercial injury to Mölnlycke.


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7. Mölnlycke has standing to bring this suit because Smith &

Nephew’s false and misleading advertisements and promotional

activities—including those which falsely and misleadingly claim that

Smith & Nephew’s products are superior to Mölnlycke’s competing

products—have directly injured Mölnlycke, which has suffered injury to

its reputation, commercial interests, and sales, within the zone of

interests protected by section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. §

1125(a)(1)(B).

FACTUAL BACKGROUND

I. PRESSURE ULCERS

8. Pressure ulcers are injuries to human skin and/or

underlying tissue caused by pressure from staying in one position for

too long. They commonly form where bone is close to the skin, such as

the ankles, back, elbows, heels and hips. Pressure ulcers are also known

as pressure injuries, pressure sores, bedsores, and decubitus ulcers.

Pressure ulcers can be caused by a variety of factors, including

malnutrition, skin wetness caused by sweating or incontinence, diseases

that reduce blood flow to the skin, and/or diseases that reduce the


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sensation in the skin. Pressure ulcers commonly develop in individuals

who are not moving about, such as those who are bedridden or confined

to a wheelchair.

9. At least four factors affect the formation of pressure ulcers:

pressure forces, shear forces, friction forces, and microclimate.

10. A “Hospital-Acquired Pressure Ulcer” (HAPU) is a pressure

ulcer acquired by a patient in a hospital setting.

II. THE PARTIES’ COMPETING WOUND DRESSINGS

11. Mölnlycke and Smith & Nephew compete with each other in

many market segments. Mölnlycke and Smith & Nephew both

manufacture and sell wound dressings used in the prevention and

treatment of pressure ulcers. Mölnlycke markets its line of products

under the brand name MEPILEX Border and Smith & Nephew markets

its line of products under the brand name ALLEVYN Life.

12. Smith & Nephew’s ALLEVYN Life dressings and

Mölnlycke's MEPILEX Border dressings—though both multi-layered


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wound dressings—are different from one another in the materials used

and the construction of the layers.

13. Mölnlycke's MEPILEX Border dressings have been studied

in published and peer-reviewed randomized controlled trials (“RCTs”)

that have compared the efficacy of standard pressure ulcer prevention

protocols to the combination of prophylactically-applied MEPILEX

Border dressings along with standard pressure ulcer prevention

protocols. These RCTs are summarized here:

Santamaria, et al. A randomised controlled trial of the effectiveness of soft silicone multi-layered foam dressings in the prevention of sacral and heel pressure ulcers in trauma and critically ill patients: the border trial. Int Wound J 2013.

Kalowes, et al. Five-layered soft silicone foam dressing to prevent pressure ulcers in the intensive care unit. American Journal of Critical Care 2016; 25(6):e108-e119.

Aloweni et al. A randomised controlled trial to evaluate the incremental effectiveness of a prophylactic dressing and fatty acids oil in the prevention of pressure injuries. Wound Practice and Research 2017;25(1):24-34

Tsao et al. A comparison of the efficacy of different wound dressing management techniques in preventing pressure ulcers. Journal of Nursing (China) 2013; 60(4):65-78.


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14. Three of the RCTs studying prophylactically-applied

MEPILEX Border dressings involved over 300 participants.

15. One of the RCTs conducted in a U.S. intensive care unit

concluded there was an 88% reduced risk of HAPU development when

MEPILEX Border was applied to the sacrum.

16. By contrast, no RCT comparing the efficacy of standard

pressure ulcer prevention protocols to the combination of

prophylactically-applied ALLEVYN Life dressings along with standard

pressure ulcer prevention protocols has appeared in any peer-reviewed

publication.

17. Despite the strong evidence regarding the efficacy of

Mölnlycke's MEPILEX Border dressing—and without commensurate

clinical data regarding its own ALLEVYN Life dressing—Smith &

Nephew claims in both print and online advertisements and during

face-to-face promotional efforts that its dressing is equivalent and/or

superior to Mölnlycke's dressing. These claims are false and misleading.


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III. SMITH & NEPHEW’S FALSE ADVERTISING AND PROMOTION OF ALLEVYN LIFE BASED ON FALSE 69% REDUCTION CLAIM

A. The Eskenazi HAPU Prevention Program

18. In March 2016, the American Journal of Critical Care

published a paper by Katie Swafford, Rachel Culpepper, and Christina

Dunn entitled Use of a Comprehensive Program to Reduce the Incidence

of Hospital-Acquired Pressure Ulcers in an Intensive Care Unit (Exhibit

A, the “SCD Paper”). The SCD Paper purports to describe the results of

a HAPU prevention program at the Sidney & Lois Eskenazi Hospital in

Indianapolis, Indiana (the “Eskenazi Program”).

19. According to the SCD Paper, the Eskenazi Program began at

the beginning of 2013 and included use of the Smith & Nephew product

ALLEVYN Life, which was introduced as part of the Eskenazi Program

in second quarter of 2013.

20. The authors acknowledge the assistance of the public

relations firm Watermeadow Medical and two of its employees for

“writing and editorial assistance, which was financially supported by

Smith & Nephew. . . .” According to its website, Watermeadow Medical


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provides “strategic communications,” “creative branding and

marketing,” “publication planning and medical writing,” “scientific PR,”

and similar services.

21. Smith & Nephew financially supported the writing and

publication of the SCD Paper because it planned to use the SCD Paper

for advertising and promotional purposes.

22. Smith & Nephew has pointed to the SCD Paper as

substantiation for false, misleading and/or unsubstantiated “tests

prove” or “establishment” claims in advertisements and promotional

communications, including (1) a press release dated June 28, 2016,

(Exhibit B, the “Smith & Nephew Press Release”), (2) a webpage on

Smith & Nephew’s website promoting ALLEVYN Life, (Exhibit C,

“Smith & Nephew’s ALLEVYN Life Promotional Webpage”), (3)

presentations made at trade shows promoting ALLEVYN Life (“Smith

& Nephew’s Trade Show Presentations”), and (4) verbal statements

made by Smith & Nephew to potential customers of wound dressings.


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As shown below, the SCD Paper does not support or substantiate Smith

& Nephew’s claims.

B. The 69% Reduction Claim In Smith & Nephew’s Press Release Is False, Misleading, And/Or Unsubstantiated

23. In June 2016, a few months after the publication of the SCD

Paper in March 2016, Smith & Nephew promoted and republished the

SCD Paper on its website, issuing the Smith & Nephew Press Release

purporting to “announce” the publication of the SCD Paper.

24. The Smith & Nephew Press Release stated:


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25. The Smith & Nephew Press Release, which includes an

image of the product and a hyperlink to the product page where

samples and ordering codes are displayed, is a commercial

advertisement and promotional communication for Smith & Nephew’s

ALLEVYN Life dressing and is designed to bolster Smith & Nephew’s

image and influence potential purchasers to buy ALLEVYN Life

dressings.

26. Smith & Nephew disseminated the Smith & Nephew Press

Release to purchasers in a manner sufficient to constitute “advertising”

or “promotion” within the health care industry.

27. The Smith & Nephew Press Release is commercial speech,

advertising, and/or a promotional communication.

28. The Smith & Nephew Press Release conveys, explicitly or

implicitly, the message that the ALLEVYN Life dressings played a role

in the reported 69% reduction of HAPUs. The Smith & Nephew Press

Release highlights the “inclusion” of ALLEVYN Life dressings in the

Eskenazi Program with the intent and effect of conveying the


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misleading, false, and/or unsubstantiated claim that the ALLEVYN Life

dressings were responsible for reducing HAPUs in the study.

29. The Smith & Nephew Press Release makes false, misleading

and/or unsubstantiated assertions of fact.

30. In the press release headline title, Smith & Nephew asserts

that “New protocol including the use of ALLEVYN Life reduces

hospital-acquired pressure ulcers by 69% in large facility” (the “69%

Reduction Claim”). This headline title is false, misleading, and/or

unsubstantiated because the HAPU incidence rate had already been

reduced by 60% before the 2013 Eskenazi Program began and before the

use of ALLEVYN Life in the program began. At most, only 9 points of

the claimed 69% reduction in HAPUs occurred as a result of the

Eskenazi Program and a result of using ALLEVYN Life. Thus, 60

points of the claimed 69% point reduction occurred before the “[n]ew

protocol including the use of ALLEVYN Life” was introduced. Moreover,

the purported incremental 9% reduction that occurred in 2013 after the

program started using ALLEVYN Life dressings is not reliable and


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cannot be substantiated by the SCD Paper because it is based on an

insignificant sample size.

31. Overall, the SCD Paper does not substantiate the Smith &

Nephew Press Release because it is based on unreliable methodology

and misleading comparisons. For example, it is misleading to compare

the reduction between 2011 and 2013 rather than between 2012 and

2013.

32. The body of the Smith & Nephew Press Release also

contains the false, misleading, and/or unsubstantiated statement that,

“[a]t the end of the first year, the prevention program demonstrated a

69% decrease in HAPUs.” This statement is false because 60 points of

the claimed 69% point reduction had already occurred before the

program was instituted and before the earliest use of the ALLEVYN

Life dressings in the program.

33. The 69% Reduction Claim in the Smith & Nephew Press

Release is an assertion of verifiable fact that requires substantiation

and support.


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Release is a “tests prove” or “establishment” claim that as a matter of

law requires substantiation and support.

35. The SCD Paper does not support or substantiate the 69%

Reduction Claim in the Smith & Nephew Press Release. The data

reported in the SCD Paper shows that 60 points of the claimed 69%

point reduction in HAPUs occurred in 2012, before the Eskenazi

hospital implemented the Eskenazi Program and before the hospital

began using ALLEVYN Life dressings in the program in the second

quarter of 2013.


Release is false, misleading, and/or unsubstantiated because, according

to the data in the SCD Paper, the rate of incidence of HAPUs had

already fallen 60% in 2012, before the Eskenazi hospital implemented

the Eskenazi Program and before the hospital began using ALLEVYN

Life dressings in the program in the second quarter of 2013.


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37. The Smith & Nephew Press Release distorts the data and

conclusions in the SCD Paper by abbreviating and truncating the SCD

Paper, omitting, for example, the acknowledgement in the paper that

“[t]he incidence of HAPUs declined markedly in 2012 compared to 2011,

before implementation of the full prevention program.”

C. The 69% Reduction Claim In Smith & Nephew’s ALLEVYN Life Promotional Webpage Is False, Misleading And/Or Unsubstantiated

38. Smith & Nephew’s ALLEVYN Life Promotional Webpage

was made and published for the purpose of influencing potential

customers to buy Smith & Nephew’s ALLEVYN Life dressings, as

evidenced, inter alia, by the image of the product integrated into the

communication.

39. Smith & Nephew’s ALLEVYN Life Promotional Webpage is

commercial speech, advertising, and/or a promotional communication.

40. Smith & Nephew made and published to purchasers Smith

& Nephew’s ALLEVYN Life Promotional Webpage in a manner


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sufficient to constitute “advertising” or “promotion” within the health

care industry.

41. Smith & Nephew’s ALLEVYN Life Promotional Webpage

makes the following false, misleading, and/or unsubstantiated claims:

42. The SCD Paper does not support or substantiate the 69%

Reduction Claim found on Smith & Nephew’s ALLEVYN Life

Promotional Webpage. The data reported in the SCD Paper shows that

60 points of the claimed 69% point reduction in HAPUs occurred in

2012 before the Eskenazi hospital implemented the Eskenazi Program

and before the hospital began using ALLEVYN Life dressings in the

program in the second quarter of 2013.


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43. The 69% Reduction Claim found on Smith & Nephew’s

ALLEVYN Life Promotional Webpage is false, misleading, and/or

unsubstantiated because, according to the data in the SCD Paper, the

rate of incidence of HAPUs had already fallen 60% in 2012, before the

Eskenazi hospital implemented the Eskenazi Program and before the

hospital began using ALLEVYN Life dressings in the program in the

second quarter of 2013.

44. The 69% Reduction Claim found on Smith & Nephew’s

ALLEVYN Life Promotional Webpage distorts the data and conclusions

in the SCD Paper by abbreviating and truncating the SCD Paper,

omitting, for example, the acknowledgement in the paper that “[t]he

incidence of HAPUs declined markedly in 2012 compared to 2011,

before implementation of the full prevention program.”

D. Smith & Nephew’s False and Misleading Advertisements and Promotion At Trade Shows

45. Smith and Nephew has integrated the false, misleading,

and/or unsubstantiated 69% Reduction Claim into numerous

promotional presentations at trade shows.


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46. For example, but without limitation, at the Association of

periOperative Registered Nurses Global Surgical Conference & Expo

(hereinafter, “AORN Conference”) in Boston in April 2017, two authors

of the SCD Paper, Katie Swafford and Rachel Culpepper, joined Smith

& Nephew’s Clinical Affairs Manager Terry Coggins to give a

presentation to registered nurses and other potential customers of

wound dressings. The presentation combined a discussion of pressure

ulcers with commercial speech designed and intended to advertise and

promote the sale of ALLEVYN Life to potential customers attending the

trade show.

47. At the AORN Conference, the presenters repeated the false,

misleading, and/or unsubstantiated 69% Reduction Claim, and again

failed to disclose that 60 points of the claimed 69% point reduction

occurred prior to the implementation of the prevention program, and

again made the false or misleading statement or implication that use of

ALLEVYN Life dressings was responsible for the purported 69%

reduction, even though 60 points of the claimed 69% point reduction

occurred prior to any use of ALLEVYN Life dressings in the program.


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48. Smith & Nephew has sponsored, supported, and encouraged

its representatives to participate in joint presentations with the authors

of the SCD Paper at trade shows for the purpose of influencing potential

customers to buy Smith & Nephew’s ALLEVYN Life dressings.

49. Smith & Nephew sponsored and supported joint

presentations with the authors of the SCD Paper at trade shows, which

presentations constitute commercial advertising or promotion within

the health care industry.

50. Smith & Nephew’s advertisements and promotional

communications (including the Smith & Nephew Press Release, Smith

& Nephew’s ALLEVYN Life Promotional Webpage, and presentations

given at trade shows), in addition to being false, misleading, and/or

unsubstantiated, deceive or have a tendency to deceive potential

purchasers.

51. Smith & Nephew’s false, misleading, and/or unsubstantiated

69% Reduction Claim is material to purchasers of pressure ulcer

dressings in the health care industry because it misrepresents an


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inherent quality or characteristic of Smith & Nephew’s ALLEVYN

products.

52. Because Mölnlycke’s wound dressings directly compete with

ALLEVYN and ALLEVYN Life, Smith & Nephew’s false and/or

misleading advertisements and promotional communications cause

enormous commercial, economic, and reputational harm to Mölnlycke.

IV. SMITH & NEPHEW’S FALSE ADVERTISING AND PROMOTION OF ALLEVYN LIFE BASED ON PRESSURE DISTRIBUTION COMPARISONS TO MEPILEX BORDER

53. In an effort to advertise and promote in interstate commerce

its ALLEVYN Life dressings for pressure ulcer prevention, Smith &

Nephew has also made literally false and misleading statements and

graphics based on in vitro pressure distribution studies (also referred to

as pressure redistribution studies) comparing ALLEVYN Life to

MEPILEX Border.

54. In particular, Smith & Nephew’s advertising campaign

claims that its ALLEVYN Life dressings are superior to MEPILEX


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Border dressings for pressure ulcer prevention based on its pressure

distribution studies.

55. But Smith & Nephew’s pressure distribution studies do not

establish that ALLEVYN Life is superior to (or even comparable to)

MEPILEX Border in pressure ulcer prevention.

56. Smith & Nephew's false and misleading claims are central to

its advertising efforts and have a tendency to deceive potential

purchasers, including Mölnlycke's customers and potential customers.

57. Smith & Nephew's false and misleading claims are material

to purchasers of pressure ulcer dressings in the health care industry

because they misrepresent an inherent quality or characteristic of

Smith & Nephew’s ALLEVYN Life dressings and misrepresent and

disparage an inherent quality or characteristic of Mölnlycke's

MEPILEX Border dressings.

58. Because Mölnlycke’s MEPILEX Border wound dressings

directly compete with ALLEVYN Life, Smith & Nephew’s false and

misleading claims in its promotional presentations and on its websites


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have caused and continue to cause enormous commercial, economic, and

reputational harm to Mölnlycke.

59. Since Smith & Nephew has made its false and misleading

claims, Mölnlycke has lost wound dressing sales and customers.

60. These false and misleading advertisements and promotions

have not only injured Mölnlycke's commercial interests, they have,

more importantly, exposed countless patients to an increased risk of

unnecessary pain and suffering from preventable pressure ulcers.

A. Smith & Nephew’s False and Misleading Promotional Presentations

61. In its promotional presentations, Smith & Nephew claims its

in vitro pressure distribution studies comparing ALLEVYN Life to

MEPILEX Border establish or prove ALLEVYN Life is superior in

pressure ulcer prevention.

62. These promotional presentations include webinars and

presentations made at trade shows to advertise and promote the sale of


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ALLEVYN Life to potential customers attending the trade shows.

These promotional presentations are widespread and systematic.

63. For example, Smith & Nephew has published and made

continuously available in interstate commerce a promotional

advertisement in the form of a webinar about pressure ulcer prevention

titled “Driving to Zero: Best Practices in Pressure Ulcer Prevention”

(“Pressure Ulcer Prevention Webinar”). See http://www.smith-

nephew.com/professional/training-and-education/wound-

management/wound-management-webinars/driving-to-zero-best-

practices-in-pressure-ulcer-prevention/, as viewed October 9, 2017.

64. Smith & Nephew’s Pressure Ulcer Prevention Webinar has

presentation slides discussing in vitro pressure distribution studies

comparing ALLEVYN Life to MEPILEX Border.

65. One slide of the Pressure Ulcer Prevention Webinar claims

that in a simulation of a bony prominence (e.g., hip) resting on a

mattress (i.e., “at rest”), ALLEVYN Life reduces pressure by 61%;


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whereas, an “other silicone foam” (which it identifies on the bottom of

the slide as MEPILEX Border) reduces pressure by “only” 37%.

66. Another slide of the Pressure Ulcer Prevention Webinar

claims that in a simulation of a fleshy area (e.g., thigh) hitting a bed rail

(i.e., “impact”), ALLEVYN Life reduces pressure by 56%; whereas, an


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“other silicone foam” (which it identifies on the bottom of the slide as

MEPILEX Border) reduces pressure by “only” 29%.

67. In the context of the Pressure Ulcer Prevention Webinar,

Smith & Nephew introduces the comparative pressure redistribution

studies to establish that its ALLEVYN Life dressings are superior to


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Mölnlycke’s MEPILEX Border dressings in pressure ulcer prevention in

order to influence potential customers to buy Smith & Nephew’s

ALLEVYN Life dressings.

68. Furthermore, in the context of the Pressure Ulcer

Prevention Webinar, Smith & Nephew introduces data that purports to

quantify pressure redistribution differences between ALLEVYN Life

dressings and Mölnlycke's MEPILEX Border dressings to establish or

prove that Smith & Nephew's dressings will better prevent pressure

ulcers by the purported 24-27% difference (for pressure redistribution

“at rest” and with “impact,” respectively).

69. The claim in Smith & Nephew’s Pressure Ulcer Prevention

Webinar that ALLEVYN Life is 24-27% better than MEPILEX Border

for pressure ulcer prevention is an assertion of verifiable fact that

requires substantiation and support.

70. The claim is a “tests prove” or “establishment” claim that as

a matter of law requires substantiation and support.


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71. Smith & Nephew’s pressure redistribution studies, however,

do not establish that Smith & Nephew’s ALLEVYN Life dressings will

prevent pressure ulcers 24-27% better—much less at all better—than

Mölnlycke’s MEPILEX Border dressings.

72. Smith & Nephew’s promotional presentation is false and

misleading because it claims that Smith & Nephew’s ALLEVYN Life

dressings prevent pressure ulcers better than Mölnlycke's MEPILEX

Border dressings. And, in context, the presentation conveys the false

and misleading message that Smith & Nephew's ALLEVYN Life

dressings prevent pressure ulcers 24%-27% better than Mölnlycke’s

MEPILEX Border dressings.

73. Similarly, Smith & Nephew also promotes its ALLEVYN

Life dressing by claiming it is superior to the MEPILEX Border

dressing in pressure ulcer prevention based on a demonstration that

involves placing a steel ball on a dressing that has been placed on a

pressure mapping pad. This test is unreliable and does not in any way

establish that ALLEVYN Life is superior to MEPILEX Border in


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pressure ulcer prevention in humans. Smith & Nephew's reliance on

this test is specious support for false, misleading, and unsubstantiated

claims of superiority.

B. Smith & Nephew’s False and Misleading Websites

74. On its websites, Smith & Nephew claims its in vitro pressure

distribution studies comparing ALLEVYN Life to MEPILEX Border

establish or prove ALLEVYN Life is superior in pressure ulcer

prevention.

75. For example, on one Smith & Nephew website regarding

ALLEVYN Life, there is a tab for “ALLEVYN LIFE Performance.” See

http://www.smith-nephew.com/ALLEVYNhome/our-

products/ALLEVYNlife3/, as viewed October 9, 2017.

76. There it compares ALLEVYN Life to MEPILEX Border,

stating: “ALLEVYN LIFE delivered 27% greater protection than

nearest competitor in a pressure distribution study.”


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77. The necessary implication of Smith & Nephew’s website

regarding “ALLEVYN LIFE Performance” is that Smith & Nephew is

claiming its ALLEVYN Life dressing offers “27% greater protection”

from pressure ulcers compared to MEPILEX Border based on its

pressure distribution study.


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78. The claim of “27% greater protection” from pressure ulcers

on Smith & Nephew’s website is an assertion of verifiable fact that

requires substantiation and support.

79. The “27% greater protection” claim is a “tests prove” or

“establishment” claim that as a matter of law requires substantiation

and support.

80. Smith & Nephew’s pressure redistribution studies, however,

do not establish that Smith & Nephew’s ALLEVYN Life dressings will

prevent pressure ulcers 27% better—much less at all better—than

Mölnlycke’s MEPILEX Border dressings.

81. Smith & Nephew’s promotional website is false and

misleading because it claims that Smith & Nephew’s ALLEVYN Life

dressings prevent pressure ulcers better than Mölnlycke's MEPILEX

Border dressings. And, in context, the website conveys the false and

misleading message that Smith & Nephew's ALLEVYN Life dressings

prevent pressure ulcers 27% better than Mölnlycke’s MEPILEX Border

dressings.


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V. SMITH & NEPHEW’S FALSE ADVERTISING AND PROMOTION OF ALLEVYN LIFE BASED ON CLINICAL STUDIES OF MÖLNLYCKE’S MEPILEX BORDER DRESSINGS

82. In an effort to advertise and promote in interstate commerce

its ALLEVYN Life dressings for pressure ulcer prevention, Smith &

Nephew has also made false and misleading statements that its

ALLEVYN Life dressings can reduce treatment costs based on the

following published study: Santamaria N., Gerdtz M., Sage S., McCann

J., Freeman A., Vassiliou T., DeVincentis S., Ng A.W., Manias E., Liu

W., Knott J., Liew D. The cost-benefit of using soft silicone multilayered

foam dressings to prevent sacral and heel pressure ulcers in trauma

and critically ill patients: a within-trial analysis of the Border Trial. INT

WOUND J 2013; doi: 10.1111/iwj.12160 (“Santamaria Study”).

83. According to the Abstract, in the Santamaria Study,

“Participants were randomly allocated either to an intervention group

with prophylactic dressings applied to the sacrum and heels in the ED

[emergency department] and changed every 3 days in the ICU

[intensive care unit] or to a control group with standard PU [pressure


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ulcer] prevention care provided during their ED [emergency

department] and ICU [intensive care unit] stay. The results showed a

significant reduction of PU [pressure ulcer] incidence rates in the

intervention group (P = 0.001) . . . . Therefore, the average net cost of

the intervention was lower than that of the control (AU$70.82 versus

AU$144.56).”

84. Notably, the Santamaria Study used MEPILEX Border

Sacrum and MEPILEX Heel products for its “prophylactic dressings.”

85. The Santamaria Study did not use or otherwise evaluate

ALLEVYN Life dressings at all.

86. Indeed, the Santamaria Study concludes: “This study

provides evidence for the cost-benefit of applying MEPILEX Border

Sacrum and MEPILEX Heel dressings on the sacrum and heels of

critically ill patients when they arrive in the ED [emergency

department]. The intervention costs of dressings and time necessary for

dressing application can be easily offset by the huge treatment savings


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accruing through the reduction of PUs [pressure ulcers] in the ICU

[intensive care unit].” (emphasis added)

87. Despite having no relationship to Smith & Nephew’s

ALLEVYN Life dressings, upon information and belief, Smith &

Nephew has cited the Santamaria Study for the proposition that its

ALLEVYN Life dressings can reduce treatment costs.

88. Smith & Nephew's false and misleading claims have a

tendency to deceive potential purchasers, including Mölnlycke's

customers and potential customers.

89. Smith & Nephew's false and misleading claims are material

to purchasers of pressure ulcer dressings in the health care industry

because they misrepresent an inherent quality or characteristic of

Smith & Nephew’s ALLEVYN Life products.

90. Since Smith & Nephew has made its false and misleading

claims, Mölnlycke has lost wound dressing sales and customers.


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91. These false and misleading advertisements have not only

injured Mölnlycke's commercial interests, they have, more importantly,

exposed countless patients to an increased risk of unnecessary pain and

suffering from preventable pressure ulcers.

COUNT I FALSE ADVERTISING IN VIOLATION OF THE LANHAM ACT

92. Mölnlycke repeats and realleges the allegations set forth in

paragraphs 1-91 as if fully set forth herein.

93. Smith & Nephew’s false, deceptive, and/or misleading

commercial advertising and promotion in interstate commerce about the

nature, characteristics, and quality of ALLEVYN Life dressings and/or

MEPILEX Border dressings violate Section 43(a)(1)(B) of the Lanham

Act, 15 U.S.C. § 1125(a)(1)(B).


advertisements and promotions have the capacity to deceive consumers

and are likely to influence purchasing decisions.


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advertisements and promotions have a material effect on purchasing

decisions.


advertisements and promotions have caused and will continue to cause

irreparable harm to Mölnlycke.

97. As a direct and proximate result of Smith & Nephew’s false,

deceptive, and/or misleading advertising and promotional activities,

Mölnlycke has suffered economic and reputational injury. This injury

falls within the zone of interests protected by § 1125(a) because

Mölnlycke has suffered injury to its reputation, commercial interests,

and/or sales as a result of Smith & Nephew’s actions.

COUNT II VIOLATION OF THE GEORGIA DECEPTIVE TRADE

PRACTICES ACT




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advertising and promotional activities violate the Georgia Deceptive

Trade Practices Act, O.C.G.A. § 10-1-372.

COUNT III VIOLATION OF THE GEORGIA UNFAIR COMPETITION

STATUTE




advertising and promotional activities violate the Georgia Unfair

Competition Statute, O.C.G.A. § 23-2-55.

COUNT IV COMMON LAW UNFAIR COMPETITION



103. By reason of the foregoing, Smith & Nephew has engaged in

unfair competition in violation of the common law.


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COUNT V TORTIOUS INTERFERENCE WITH

CONTRACTUAL AND BUSINESS RELATIONS



105. Upon information and belief, Smith & Nephew's has

purposely and maliciously engaged in improper and wrongful conduct to

induce Molnlycke's customers and potential customers to discontinue or

fail to enter into anticipated business relationships with Mölnlycke.

106. Smith & Nephew's tortious conduct proximately caused

damage to Mölnlycke.

107. By reason of the foregoing, Smith & Nephew has engaged in

tortious interference with contractual and business relations.

JURY DEMAND

108. Mölnlycke demands a trial by jury on all issues so triable as

a matter of right and law.

PRAYER FOR RELIEF

WHEREFORE, by virtue of the unlawful conduct of Smith &


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Nephew, plaintiff Mölnlycke respectfully prays that:

a. The Court enter judgment that Smith & Nephew has engaged in false advertising in violation of Section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B), has engaged in deceptive trade practices in violation of the Georgia Uniform Deceptive Trade Practices Act, O.C.G.A. § 10-1-370 et seq., has engaged in unfair competition under O.C.G.A. § 23-2-55 and the common law, and has tortuously interfered with contractual and business relations;

b. The Court permanently enjoin Smith & Nephew, its officers, agents and servants, employees, attorneys, and all others in active concert of participation with it who receive actual notice, pursuant to Fed. R. Civ. P. 65 and 15 U.S.C. § 1116(a), from publishing, distributing, disseminating, or otherwise making the false and/or misleading claim in commercial advertising or promotional communications that the Eskenazi Program including ALLEVYN Life reduced HAPUs by 69%.

c. The Court order Smith & Nephew to disseminate, in a form to be approved by the Court, a retraction of the 69% Reduction Claim and corrective advertising sufficient to reach all those who were the target of its false and deceptive claims;

d. The Court permanently enjoin Smith & Nephew, its officers, agents and servants, employees, attorneys, and all others in active concert of participation with it who receive actual notice, pursuant to Fed. R. Civ. P. 65 and 15 U.S.C. § 1116(a), from publishing, distributing, disseminating, or otherwise making the false


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and/or misleading claim in commercial advertising or promotional communications that ALLEVYN Life is superior to MEPILEX Border in pressure ulcer prevention based on Smith & Nephew’s pressure distribution studies.

e. The Court order Smith & Nephew to disseminate, in a form to be approved by the Court, a retraction of the superior pressure ulcer prevention claim based on pressure distribution studies and corrective advertising sufficient to reach all those who were the target of its false and deceptive claims;

f. The Court permanently enjoin Smith & Nephew, its officers, agents and servants, employees, attorneys, and all others in active concert of participation with it who receive actual notice, pursuant to Fed. R. Civ. P. 65 and 15 U.S.C. § 1116(a), from publishing, distributing, disseminating, or otherwise making the false and/or misleading claim in commercial advertising or promotional communications that ALLEVYN Life reduces treatment costs associated with pressure ulcers based on the Santamaria Study.

g. The Court order Smith & Nephew to disseminate, in a form to be approved by the Court, a retraction of the claim that ALLEVYN Life reduces treatment costs associated with pressure ulcers based on the Santamaria Study and corrective advertising sufficient to reach all those who were the target of its false and deceptive claims;

h. The Court order Smith & Nephew, pursuant to 15 U.S.C. § 1116(a), to file with the Court and serve on Mölnlycke within thirty days after entry of the injunction a report in writing and under oath


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setting forth in detail the manner and form in which Smith & Nephew has complied with the injunction;

i. The Court award Mölnlycke Smith & Nephew’s profits and/or Mölnlycke’s damages from Smith & Nephew’s false and misleading advertising, deceptive trade practices, unfair competition, and tortious interference with contractual and business relations in an amount to be determined by the trier of fact and to be increased as provided by applicable law due to Smith & Nephew’s willful violation of the law;

j. The Court declare that this is an “exceptional case” under 15 U.S.C. § 1117(a), and that Mölnlycke is therefore entitled to an award of its attorneys’ fees and full costs;

k. The Court award Mölnlycke punitive damages for Smith & Nephew’s intentional, willful, and malicious conduct to the extent permitted by law;

l. The Court award Mölnlycke such other and further relief as the Court deems just and proper.

[Signature block on the next page]


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Dated: October 13, 2017 Respectfully submitted,

/s/ Lawrence K. Nodine Lawrence K. Nodine (Georgia Bar No. 545250) [email protected] Richard W. Miller (Georgia Bar No. 065257) [email protected] Sharon H. Billington (Georgia Bar No. 891220) [email protected] Daniel B. Englander (Georgia Bar No. 129215) [email protected] Chittam U. Thakore (Georgia Bar No. 890965) [email protected] Ballard Spahr LLP 999 Peachtree Street NE, Suite 1000 Atlanta, Georgia 30309 Telephone: (678) 420-9300 Facsimile: (678) 420-9301 Attorneys for Plaintiff Mölnlycke Health Care US, LLC


Exhibit I...MEPILEX Border dressings involved over 300 participants. 15. One of the RCTs conducted...

Documents

Transcript of Exhibit I...MEPILEX Border dressings involved over 300 participants. 15. One of the RCTs conducted...