A Medical Device Daily

Electronic medical transcription company MedQuist (Mt. Laurel, New Jersey) reported settling claims related to a shareholder class action lawsuit for $7.75 million.

The Greater Pennsylvania Pension Fund was the lead plaintiff in the suit, which alleged MedQuist violated federal securities laws by issuing false and misleading statements to the market between April 2002 and November 2004, thus artificially inflating the market price of the company's securities.

MedQuist and the former company officers named as defendants did not admit liability or wrongdoing in the settlement.

In 2004, MedQuist reported that it was restructuring its top management and instituting other reform measures following an eight-month independent review that found problems with the company's billing methods. The company has said it is cooperating with the Securities and Exchange Commission's ongoing investigation into its billing practices.

The settlement is subject to formal documentation by the parties and conditioned on final court approval.

In other legalities: EP MedSystems (West Berlin, New Jersey) reported that it has executed a settlement with the U.S. Department of the Treasury and that it believes issues are closed related to its shipment of products to restricted countries in 2004 and earlier. The company, not admitting or denying guilt, agreed to pay the government $33,000, with no restrictions on commercial or export activities.

The company said it accrued $44,000 for this penalty as of Sept. 30, based on the oral representations at the time.

In November 2006, the company reported executing a $244,000 settlement with the Bureau of Industry and Security of the U.S. Department of Commerce related to the same issues (Medical Device Daily, Nov. 10, 2006).

In October 2006, the company's board terminated Reinhard Schmidt as president/CEO and COO for possible violation of U.S. law in the sales and the accuracy and completeness of statements filed with the Department of Commerce related to those sales.

"We are pleased to put the issues with both the Departments of Commerce and Treasury behind us and focus on the market opportunities for EP MedSystems," said David Bruce, EP MedSystems' president/CEO.

EP MedSystems develops cardiac electrophysiology products used in visualizing, diagnosing and treating ardiac rhythm disorders.