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Fraudulent Inducement to Contract Alleged by Former Vice President of TruFUSE® Sales for minSURG Corporation

Orthopedic Development Corporation's President and CEO, James Doulgeris, said in an affidavit in a federal court case (Case Number: 1:07-CV-00363) in North Carolina that he had never engaged in business in that state, had not gone there to recruit a sales executive or "otherwise traveled there." However, a securities watchdog website which posted an investigative report on ODC on June 8, has copies of e-mails that appear to disprove those assertions. The e-mails include flight numbers and times, and the names and locations of the hotels in which he allegedly stayed.

Winston-Salem, NC (PRWEB) June 25, 2007 -- Dan Grayson, former Vice President of TruFUSE Sales for minSURG Corporation, a wholly owned subsidiary of Orthopedic Development Corporation (ODC), Clearwater, Florida, announced today that he has filed litigation against those entities and James Doulgeris, the company's President and CEO on May 8, 2007 at 9:14 am in the United States District Court for the Middle District of North Carolina (Case Number: 1:07-CV-00363, Grayson vs. Orthopedic Development Corporation, minSURG Corporation and James Doulgeris). The suit alleges Fraudulent Inducement to Contract and Breach of Contract.

"This should simply be a case of who's telling the truth and who has the evidence to support it," Grayson stated. "I am confident that when it comes down to that, my story will be vindicated in a court of law. I'm spending my own money to fight this battle on behalf of patients, surgeons, insurers and the medical community. I'm appealing for help from any and all applicable regulatory agencies to stop medical device companies that make claims and market products or procedures prior to having documented clinical studies. In my opinion, the FDA, SEC, FBI, OIG, Medicare, American Medical Association and other federal and state regulatory agencies should take a serious look at those companies."

Grayson continued, "There are other questions that have gone unaddressed by Doulgeris and other company officers and directors, such as; Where are their clinical studies? Why won't they release any of the results from random surgeons? Why did world-famous surgeon, Jurgen Harms, M.D., state in an email to Sharesleuth.com, 'Without biomechanical test and clinical outcome studies, I don't see a chance to use this product clinically?" (Note: Dr. Harms is considered to be one of the world's noted authorities on spine surgical procedures.)

ODC, in a press release on June 21, 2007 found on StreetInsider.com, accused Grayson, an investor and three other company employees of conducting a defamatory anonymous e-mail campaign aimed at the companies and its officers and directors. The press release also went on to state that minSURG has 'shipped enough TruFUSE to treat over 1,500 spinal levels', 'over 80 orthopedic and neurospine surgeons have used TruFUSE' and 'more than 60 hospitals have evaluated, and approved TruFUSE for use in their hospitals'.

"It's been my experience that medical device companies don't gauge the success of their product by the number of the devices 'shipped' or necessarily the number of surgeons using the product. Instead, they focus on the patients and provide unbiased multi-center studies and definitive proof that the product works prior to releasing it for use." Grayson elaborated, "I really don't think that patients or surgeons care about how many products were 'shipped' when it comes to efficacy, safety and surgical outcomes. Any time I have spoken to surgeons about 'clinical success', they have never mentioned 'shipping' as even being a criteria of how well a product works. I sure would like to see the documentation pertaining to the alleged evaluations from 'more than 60' hospitals."

The same ODC press release stated, 'The board of directors created a special committee comprised of its independent directors earlier this year, which worked in conjunction with the legal counsel to assess the veracity of the allegations set forth in the anonymous e-mails and, later, by the defendants directly after they were exposed. The board committee determined that the company, its remaining officers, employees, directors and partners have acted responsibly, with integrity and have conducted the company's business with the highest professional standards'.

"Where in this statement, made by ODC, did they actually address the 'veracity of the allegations' made by the alleged anonymous e-mails," Grayson noted. "I believe they are evading questions, realize they have been exposed and are trying to take the focus away from the real issues."

In a document, referenced in an article on www.Sharesleuth.com (a securities watchdog website that is covering this story), Doulgeris states, "A review of the first 500 cases has prompted us to increase our estimate of expected failures...." The Sharesleuth.com article features several links to documents that exhibit the company's claims and the ensuing litigation.

"Where is the alleged documentation of those 500 cases Doulgeris claims to have reviewed by January 31, 2007?", Grayson commented. "That would mean 500 folders on 500 patients with thousands of pages of documentation, including a significant number of computed tomography scans (CT scans)." A CT scan is considered by many surgeons to be the gold standard to analyze fusion and determine if the allograft dowel did not come loose.

LifeLink Tissue Bank, a Tampa, not-for-profit, manufactures the devices, according to an article in the St. Petersburg Times on June 12, 2007.

In addition to the article on Sharesleuth.com, other articles regarding this litigation have recently appeared in The St. Petersburg Times, Florida's largest circulation newspaper and The New York Times.

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