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Sulzer launches arbitration procedure against Sulzer Medica

A Sulzer Medica hip implant Keystone Archive

The Swiss industrial group, Sulzer, has launched arbitration proceedings against its former subsidiary, Sulzer Medica, to avoid paying for claims stemming from court cases in the United States.

The two companies went their separate ways this summer, when Sulzer Medica was spun off from its parent. Sulzer claims the other company undertook contractually to indemnify it against all expenses and damage claims arising from court cases in connection with the medical devices sector.

Sulzer asked for the arbitration on Thursday to confirm the legal validity of the contract and the spin-off’s obligations. Sulzer Medica has denied in recent weeks there is any clause stating it must indemnify its former parent company.

Sulzer Medica is facing potentially huge payouts to American patients who received defective hip implants. In November, Sulzer Medica’s CEO Stephan Rietiker stated Sulzer’s responsibility was still intact despite the split between the two companies.

For Rietiker, Sulzer’s latest move has changed nothing.

“It is our clear intent to quickly and fairly compensate any affected patients in the United States,” he said on Thursday. “We will not be deterred from this path by third parties. Sulzer remains welcome to participate in the settlement.”

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SWI - a branch of Swiss Broadcasting Corporation SRG SSR

SWI - a branch of Swiss Broadcasting Corporation SRG SSR