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Court Rules in Favor of Natera in CareDx Unfair Competition Claim, Voids Damages

This article has been updated to include information from a statement made by CareDx and to clarify that the court determined that although Natera engaged in willful deception, it could not be linked to customer reliance on said advertisments.

NEW YORK – The US District Court for the District of Delaware found Natera not guilty of unfair competition against CareDx and that CareDx is not entitled to damages related to that claim, according to court filings issued Monday.

The decision essentially reverses a verdict made last year concerning damages owed because of false advertising. In that ruling, a jury ordered Natera to pay CareDx $21.2 million in compensatory damages and $23.7 million in punitive damages.

Although the court let stand the jury's earlier finding that both companies engaged in some instances of false advertising, it determined that CareDx failed to link any false statement to customer reliance on that advertising. 

The court also ruled that CareDx failed to show that Natera's actions caused it injury. This, the court explained in a memorandum, made CareDx ineligible for damages under that claim.

In a statement made on Tuesday, CareDx stated that it intends to appeal the court's decision not to award monetary damages. 

In morning trading on the Nasdaq, Natera's shares were down about 1 percent at $48.83, while CareDx's shares were up a fraction of a percent at $10.17.