Scientist sues Baxter Healthcare over listing in Internet catalog
A scientist . . . is suing a biotechnology company he claims improperly allowed one of his inventions to be advertised on an Internet catalog of medical devices . . . A check of the Web site, the Neoforma Healthcare Product Directory (www.neoforma.com), on Wednesday found no reference to . . . his catheter.
Associated Press, March 25, 1998
It takes very little time to fall twenty feet, but I remember having time to wonder how I could possibly have found myself rapidly descending upside down in the air without the slightest warning...
This episode from many years earlier came to mind when we heard about the lawsuit. That feeling of helpless dismay at some instantaneous change of state.
Of the forty thousand products listed on our website at the time, one of them was apparently outdated. It was bound to happen. It was just bad luck that we happened to step into a pool of unquenched anger.
What was this guy thinking?! He could have simply picked up the phone and called the number that we listed at the bottom of every page on our website and said, “Hey, I noticed the name of my product erroneously listed as being distributed by Baxter. What’s that about?”
To which we would’ve said, “We’re sorry for the misunderstanding. We simply listed your product as it had been listed by the FDA. Just a minute . . . Okay, check your screen now. The listing has been permanently removed. Nobody will ever see it again. Thanks for letting us know.” It would really have been that simple. But he had a grudge to embrace.
I can’t imagine any moral position in which filing that lawsuit was more productive than making a phone call. I suppose it was easier in many respects. He didn’t even have to face us or Baxter to initiate the lawsuit. What power. What a great way to turn a simple problem into a fierce, costly battle. The process can be very profitable to astute opportunists. And it can be very unpleasant for unwary bystanders.
Years ago, I called Jake, a friend who happened to be a lawyer, to tell him about some simple comments I had heard regarding a business in which he was a partner. My only motivation was our friendship. I thought that the information might help him.
Jake became agitated. He asked where I had obtained my information. When I wouldn’t reveal the source, he did not hesitate for a moment to tell me, “Well, you can’t hold that information back. I’ll subpoena you. You could go to jail, if you don’t tell me.”
I didn’t share my source and he didn’t subpoena me, but I learned just how deep our friendship went. I was sorry to see that he viewed the world from such an adversarial position that he couldn’t even rec- ognize a kind gesture from a friend.
Naturally, I didn’t speak much with him after that. Then, years later, he called me out of the blue. He was very friendly and asked if I could recommend some investors for two healthcare device companies he represented. I could only think, How can you be asking for a favor after threatening to throw me in jail for trying to help you?
I did forward those companies’ business plans to one venture firm. I knew that, in this boom time, they would not get special consideration unless I followed up on them, and I didn’t follow up on them.
But the encounter with Jake still rankled. I had already been personally offended by a legal threat when the Baxter claim turned up. My sense of moral indignation would have been triggered by this trivial lawsuit regardless, but the timing of what was quickly becoming our official media debut could not have been worse.
Just before the AP article appeared, Jeff and I watched the sun set as we rode in a taxi on the way from the airport to our Chicago hotel room. We had been invited to visit Allegiance, the largest distributor of healthcare products to hospitals, and their sister company, Baxter, one of the most important manufacturers of healthcare products.
After years of dialog, we had finally convinced these companies that we might not be the enemy. In fact, we might harbor ideas and tools that could provide them an even greater reach to customers.
At the time, large suppliers were very concerned about how Internet companies might upset the balance in their relatively stable markets. We had come far enough to appreciate how tightly the big suppliers held onto the status quo. Their bonuses and earnings were completely driven by quarter-to-quarter results. We had discovered how powerful inertia can be.
After two years of polite but persistent badgering by us, one of the larger nuts had begun to crack. We had successfully worked with big suppliers before, but never with the potential of becoming an integral part of their business process. This time might be different. Allegiance was treating us as if we might be important. Our Internet catalog could improve the way they communicated with their customers.
We were eager to use our new investment money to open their shell a bit more. So Jeff and I flew to Illinois to meet with several executives at their corporate offices.
As we checked into the hotel, a polite woman at the front desk handed us a note: “Call office ASAP.”
We had setbacks frequently enough to know that we were about to receive bad news. As we solemnly rode the elevator up to our floor, we each silently browsed our internal list of problems, trying to guess what awful thing it could be this time. This was a technique we had learned well. If we assumed the worst, we would usually be relieved by how trivial the actual problem was. It allowed us to convincingly convey confidence to our employees during the many times of crisis in our early days.
We reached Todd in the office. He asked us if we had already seen the press release in our email. We told him that, no, we hadn’t.
He said, “Well, check it. You’re not going to like what you see. We’re named in a lawsuit against Baxter. Some guy from New Jersey is suing them over a listing on our website. Of course, we removed the listing immediately after Baxter called us this morning. The lawsuit doesn’t target us, but it doesn’t bode well for your meetings out there.”
Fortunately, we had been able to remove the listing before the press investigated the issue.
Jeff called our contacts at Allegiance and Baxter. They told us, “Yes, we know about the lawsuit. Yes, we know that it is a frivolous issue. We have a long history with this guy. But the corporate office has told us that we can’t meet with you until the lawsuit is settled. I’m sorry. We were really excited about working with you.”
We all knew that even a frivolous lawsuit might take years to settle. It was like effectively saying that we wouldn’t be able to work with these very important companies. Ever.
After the call, as we stared out at the darkened city from the dimly lit hotel room, our view was dominated by randomly scattered rectangles of light against dark. Movement within some lit office building windows indicated unfinished work. Flickering light from behind blinds on some hotel windows indicated evening cityscape.
Our “worst case” technique had backfired. This was worse than any worst case we could imagine. At least nobody else was there to witness our despair and disgust.
We never did find out what happened in the lawsuit against Baxter. We assume that since we never had to do more than write a letter explaining the course of events, someone recognized the triviality of the whole thing and dismissed it.
But for us, the damage had been done.