A New York appeals court has reduced a near $66 million jury verdict faced by fitness equipment manufacturer Cybex to $44 million.
The ruling by the Appellate Division, Fourth Judicial Department, of the Supreme Court of the State of New York in the case of Natalie Barnhard vs. Cybex International reduces the award to Barnhard by about 31 percent.
Cybex is responsible for payment of the $44 million, but will seek reimbursement of approximately $11 million from its co-defendant in the case, Amherst Orthopedic Physical Therapy, resulting in a $33 million modified judgment.
In December 2010, a New York Supreme Court case ruled the parties responsible for an accident and major injury in which Barnhard allegedly pulled over on herself a Cybex weight machine in 2004 at Amherst Orthopedic Physical Therapy in New York, where she was employed. Cybex officials have maintained that Barnhard improperly used the machine and the company was not at fault.
“While the company appreciates the decision of the court to reduce the judgment, we believe that the amount of damages represented by the reduced judgment continues to be overstated,” Cybex Chairman and CEO John Aglialoro said in a statement after the latest ruling Nov. 21.
Aglialoro said the company will petition the appeals ruling again, expecting within 60 days a decision by the court whether to accept the appeal for consideration. The company is also “exploring both ways to protect itself in the event the court of appeals does not accept the appeal for consideration and available alternatives to fund an ultimate resolution of the matter.”
In the fourth quarter 2010, Cybex set aside $46 million, plus $12.7 million in tax provisions, related to the case.
Cybex investors (Nasdaq: CYBI) sent the company’s stock down 35 percent to $0.63 cent per share as of midday Nov. 21, following the news. Cybex faces several delisting reviews by the Nasdaq market as it struggles to keep its stock above $1 per share and its equity above $10 million.
-- David Clucas