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Philips Electronics to appeal ruling in $467 million patent lawsuit

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[October 02, 2014]  (Reuters) - Dutch healthcare equipment company Philips said on Thursday it would appeal against a U.S court ruling ordering it to pay $466.8 million in compensation to Masimo Corp for infringing two patents.

The patents related to technology used to help measure blood oxygen and track pulse rates.

"We are very disappointed in the verdict of the jury and surprised by the magnitude of the proposed award," Philips Chief Executive Officer Frans van Houten said.

"Philips intends to pursue all avenues of appeal of this verdict at both the District and Appellate courts in the US."

Philips said it would report the compensation award as an exceptional charge to the earnings before interest, tax and amortisation line of its third-quarter healthcare sector results.

Shares of Masimo closed 12.9 percent higher after the ruling on Wednesday, rising $2.74 to $24.02 on the Nasdaq.

Jurors in Wilmington, Delaware needed less than a day of deliberations before ruling in favour of Irvine, California-based Masimo, following a two-week trial.

They also said Philips, a unit of Amsterdam-based Koninklijke Philips NV, did not show it more likely than not that Masimo had infringed one of its own patents.

The case, which began in 2009, concerned technology for pulse oximetry, a non-invasive procedure to measure the level of oxygen saturation in a patient's blood.

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Philips, which has offices in Andover, Massachusetts, had conceded having infringed Masimo's patents, but claimed the patents were void because they were "obvious" and described inadequately. The jury said Philips did not prove those claims.

Masimo had sued Philips in February 2009. A Masimo spokesman declined to comment on the verdict, and a lawyer for the company could not immediately be reached.

The case is Masimo Corp v. Philips Electronics NA et al, U.S. District Court, District of Delaware, No. 09-00080.

(Reporting by Jonathan Stempel in New York and Thomas Escritt in Amsterdam; Editing by James Dalgleish and Susan Thomas)

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