NuVasive Shares Dropped: What You Need to Know

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Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of medical device developer NuVasive (NAS: NUVA) were getting hammered by investors today, falling as much as 12% in intraday trading after the company lost a court case.

So what: A San Diego jury awarded Medtronic (NYS: MDT) $101 million in damages after it concluded that NuVasive spinal products infringed on Medtronic patents. One Medtronic lawyer indicated that the jury award only covers the period through June 2010 and that the company will file a motion to bring the award up to date.

Now what: For a company the size of NuVasive, a $101 million judgment is no small matter. However, the company had more than $500 million in cash and equivalents on its balance sheet as of June 30. The bigger question for the company will be what this means for the future as it will either have to either stop selling the infringing product or pay Medtronic for use of the technology. NuVasive has said that it will challenge the decision, but investors might want to consider what the future looks like if the current verdict holds.

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At the time this article was published The Motley Fool owns shares of Medtronic. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.Fool contributorMatt Koppenhefferowns shares of Medtronic, but does not have a financial interest in any of the other companies mentioned. You can check out what Matt is keeping an eye on by visiting hisCAPS portfolio, or you can follow Matt on Twitter@KoppTheFoolorFacebook. The Fool'sdisclosure policyprefers dividends over a sharp stick in the eye.

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