Rebotix Repair LLC v. Intuitive Surgical, Inc.

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

TAMPA DIVISION

REBOTIX REPAIR, LLC,

Plaintiff /

Counterclaim Defendant,

v. Case No. 8:20-cv-2274-VMC-TGW

INTUITIVE SURGICAL, INC.,

Defendant /

Counterclaim Plaintiff.

______________________________/

ORDER

This matter comes before the Court upon consideration of

Defendant Intuitive Surgical, Inc.’s Daubert Motion to

Exclude the Opinions of Dr. Russell Lamb. (Doc. # 114).

Plaintiff Rebotix Repair, LLC has responded. (Doc. # 145).

For the reasons that follow, the Motion is denied.

I. Background

The Court and the parties are well familiar with the

background facts and claims in this case, and the Court will

not belabor them here. Suffice it to say that this is an

antitrust suit initiated by Rebotix, a company that offers a

service whereby it “repairs” the EndoWrist surgical implement

originally designed and manufactured by Intuitive. The

parties hotly contest the relevant antitrust market

definition, Intuitive’s alleged monopoly power, and the

anticompetitive effects of Intuitive’s actions on the

relevant market. Rebotix offers the testimony of Dr. Lamb in

connection with those issues.

Dr. Lamb is the president and co-founder of an economics

consulting firm that provides clients with economic research

and quantitative and statistical analyses. (Doc. # 114-2 at

1). He has a Ph.D. in economics and has studied the economics

of markets and prices for 30 years. (Id.). In his report, Dr.

Lamb reached the following conclusions:

(1) The market for minimally invasive soft tissue

surgical robots (“MIST robots”) constitutes a

“relevant antitrust product market.” The market for

MIST robots is the “tying market.”

(2) “The EndoWrist Repair and Replacement Market

constitutes a relevant antitrust product market.”1

The EndoWrist Repair and Replacement Market is the

“tied market.”

(3) Intuitive possessed monopoly power in the U.S.

market for MIST robots and in the EndoWrist Repair

1 In addition, Dr. Lamb posits that the United States

constitutes the relevant geographic market with respect to

both identified product markets. Intuitive does not dispute

this point.

and Replacement Market during the relevant period.

Furthermore, Intuitive used its monopoly power in

the market for MIST robots to maintain a monopoly

in the related EndoWrist Repair and Replacement

Market.

(4) Intuitive’s alleged misconduct here was

“anticompetitive and resulted in harm to

competition in that hospitals had little choice but

to pay higher prices for replacement EndoWrist

surgical instruments from Intuitive in order to use

their da Vinci surgical robots than they otherwise

would have had they been able to repair their

EndoWrist surgical instruments through third-party

repair companies such as Rebotix.”

(Id. at 5).

Now, Intuitive seeks to exclude Dr. Lamb’s testimony.

(Doc. # 114). Rebotix has responded (Doc. # 145), and the

Motion is ripe for review.

II. Discussion

Federal Rule of Evidence 702 states:

A witness who is qualified as an expert by

knowledge, skill, experience, training, or

education may testify in the form of an opinion or

otherwise if: (a) the expert’s scientific,

technical, or other specialized knowledge will help

the trier of fact to understand the evidence or to

determine a fact in issue; (b) the testimony is

based on sufficient facts or data; (c) the

testimony is the product of reliable principles and

methods; and (d) the expert has reliably applied

the principles and methods to the facts of the case.

Fed. R. Evid. 702.

Implementing Rule 702, Daubert v. Merrell Dow Pharms.,

Inc., 509 U.S. 579 (1993), requires district courts to ensure

that all scientific testimony or evidence admitted is both

relevant and reliable. See Id. at 589–90. The Daubert analysis

also applies to non-scientific expert testimony. Kumho Tire

Co. v. Carmichael, 526 U.S. 137, 147 (1999). District courts

must conduct this gatekeeping function “to ensure that

speculative, unreliable expert testimony does not reach the

jury under the mantle of reliability that accompanies the

appellation ‘expert testimony.’” Rink v. Cheminova, Inc., 400

F.3d 1286, 1291 (11th Cir. 2005).

The Eleventh Circuit “requires trial courts acting as

gatekeepers to engage in a ‘rigorous three-part inquiry.’”

Hendrix v. Evenflo Co., 609 F.3d 1183, 1194 (11th Cir. 2010).

The district court must assess whether:

(1) the expert is qualified to testify competently

regarding the matters he intends to address; (2)

the methodology by which the expert reaches his

conclusions is sufficiently reliable as determined

by the sort of inquiry mandated in Daubert; and (3)

the testimony assists the trier of fact, through

the application of scientific, technical, or

specialized expertise, to understand the evidence

or to determine a fact in issue.

Id. The proponent of the expert testimony bears the burden of

showing, by a preponderance of the evidence, that the

testimony satisfies each of these requirements. Id.

Here, Intuitive does not challenge Dr. Lamb’s

qualifications or whether his testimony would be helpful to

the trier of fact. It instead focuses on the reliability of

his methodology and its arguments that certain of his opinions

are contrary to law.

Turning to reliability, then, the Court must assess

whether the expert’s methodology is reliable. “Exactly how

reliability is evaluated may vary from case to case, but what

remains constant is the requirement that the trial judge

evaluate the reliability of the testimony before allowing its

admission at trial.” United States v. Frazier, 387 F.3d 1244,

1262 (11th Cir. 2004) (citing Fed. R. Evid. 702, Advisory

Committee Notes (2000)). There are four recognized, yet non-

exhaustive, factors a district court may consider in

evaluating reliability:

(1) whether the expert’s methodology has been

tested or is capable of being tested; (2) whether

the technique has been subjected to peer review and

publication; (3) the known and potential error rate

of the methodology; and (4) whether the technique

has been generally accepted in the proper

scientific community.

Seamon v. Remington Arms Co., 813 F.3d 983, 988 (11th Cir.

2016) (citations omitted). A district court can take other

relevant factors into account as well. Id. (citations

omitted).

“If the [expert] witness is relying solely or primarily

on experience, then,” in establishing reliability, “the

witness must explain how that experience leads to the

conclusion reached, why that experience is a sufficient basis

for the opinion, and how that experience is reliably applied

to the facts.” Frazier, 387 F.3d at 1261 (citation and

internal quotation marks omitted). The Court’s analysis as to

reliability “focus[es] ‘solely on principles and methodology,

not on the conclusions that they generate.’” Seamon, 813 F.3d

at 988 (citation omitted).

Intuitive challenges all of Dr. Lamb’s four opinions

outlined above. The Court will address each argument in turn.

1. Relevant antitrust product market for MIST robots

“Defining the market is a necessary step in any analysis

of market power[.]” U.S. Anchor Mfg., Inc. v. Rule Indus.,

Inc., 7 F.3d 986, 994 (11th Cir. 1993). “Defining a relevant

product market is primarily a process of describing those

groups of producers which, because of the similarity of their

products, have the ability — actual or potential — to take

significant amounts of business away from each other.” Id. at

995 (citation and internal quotation marks omitted). Eleventh

Circuit precedent requires an antitrust plaintiff to proffer

expert testimony to establish a relevant product market. Am.

Key Corp. v. Cole Nat’l Corp., 762 F.2d 1569, 1579 (11th Cir.

1985) (holding lay testimony insufficient to establish

relevant antitrust market).

One of Dr. Lamb’s challenged conclusions is that the

market for MIST robots is a relevant antitrust product market.

In his report, Dr. Lamb stated that:

[T]here are no economic substitutes for minimally

invasive soft tissue surgeries performed with MIST

Surgical Robots and that MIST Surgical Robots are

a necessary input in performance of those

surgeries. In particular . . . other forms of

minimally invasive soft tissue surgery (such as

traditional laparoscopic surgery) and non-MIST

robotic surgeries are not economic substitutes for

robotically assisted minimally invasive soft tissue

surgeries. Therefore, because there are no economic

substitutes for robotically assisted minimally

invasive soft tissue surgeries, which are defined

by the use of the MIST Surgical Robot (of which da

Vinci is the dominant type during the Relevant

Period), there are no economic substitutes for MIST

Surgical Robots.

(Id. at 18). In reaching this conclusion, Dr. Lamb considered

whether other types of surgery – such as laparoscopic or open

surgery – could be economic substitutes for minimally

invasive soft tissue surgeries performed with MIST robots,

and he determined that they were not. Dr. Lamb reached this

conclusion because: (1) there is testimony from a hospital

representative that a 5-10% increase in the price of the da

Vinci surgical robot would not lead hospitals to perform more

traditional nonrobotic surgeries because opting to forego a

MIST robot would cause surgeons to leave, patients to go

elsewhere, and the hospital to lose revenue; (2) Intuitive

has acknowledged that it did not view traditional surgeries

as competition for surgeries performed by MIST robots; (3)

MIST robots possess different features and offer different

benefits to surgeons and patients compared to traditional

surgeries; and (4) there are non-clinical benefits to using

the MIST robots, such as hospitals being able to attract top

surgeons and market their use of the MIST robots to drive

revenue. (Id. at 19-29).

Not only that, but in Dr. Lamb’s opinion surgical robots

that do not perform the same types of surgical procedures as

the MIST robots are not functional or economic substitutes.

(Id. at 29-30). Intuitive executives have testified that no

other surgical robots have FDA clearance to perform all the

same surgical procedures as the da Vinci. (Id.). Two products

compete with da Vincis in the relevant market: the Senhance

surgical robot sold by TransEnterix and the Flex surgical

robot sold by Medrobotics. (Id. at 30 n.119; Doc. # 114-3 at

90-91). According to Dr. Lamb’s research, these two other

surgical robots have only a de minimis share of the market

for MIST robots. (Doc. # 114-2 at 50). An Intuitive executive

testified that “in 2020 in the U.S., Intuitive’s da Vinci had

an installed base between 3,500 and 4,000; TransEnterix’s

Senhance had an installed base of 15 or less; and Medrobotics’

Flex had an installed base between seven and ten.” (Id.).

Relying on the companies’ SEC filings, Dr. Lamb concluded

that in 2020, Intuitive’s da Vinci robot had a 99.5% market

share in the U.S. market for MIST surgical robots, with

TransEnterix and Medrobotics together accounting for the

other 0.5%. (Id. at 51).

With this background in mind, the Court turns to

Intuitive’s argument. Here, Intuitive argues that Dr. Lamb’s

opinion defining a relevant antitrust product market for MIST

robots should be excluded because he failed to properly employ

his chosen methodology – the small but significant and non-

transitory increase in price (“SSNIP”) test. (Doc. # 114 at

2-3).

To begin, the SSNIP test measures whether increasing a

product’s price by a relatively small amount – usually by

five to ten percent – results in a substantial number of

consumers purchasing an alternative product. F.T.C. v. Whole

Foods Market, Inc., 548 F.3d 1028, 1038 (D.C. Cir. 2008). As

Dr. Lamb explains in his report, “[i]f the hypothetical

monopolist is able to permanently (that is, in a ‘non-

transitory’ way) raise prices for a product or group of

products by a ‘small but significant’ amount . . . without

losing so much in sales volume that the increase in price is

unprofitable, then that product or group of products

constitutes a relevant antitrust product market.” (Doc. #

114-2 at 17 n.73 (citing “Horizontal Merger Guidelines,” U.S.

Department of Justice and the Federal Trade Commission,

August 19, 2010, at § 4.1.1)).

When asked about whether he performed a SSNIP test, Dr.

Lamb replied that:

Well, I conducted a form of SNNIP analysis based on

practical indicia. I did not conduct the kind of

analysis that sometimes — econometric analysis

that’s sometimes done in which one looks at

econometric measures of cross-price elasticity

based on a regression. I did not conduct that. It

wasn’t necessary to do so in order to define the

relevant antitrust product market for the tying

product, for the da Vinci surgical robots, but I

did talk about the practical indicia with respect

to a SNNIP analysis of the relevant market in which

the da Vinci surgical robot was bought and sold in

the United States.

(Doc. # 114-3 at 92).

In his expert report, Dr. Lamb wrote that: “Even when

the evidence necessary to perform the hypothetical monopolist

test quantitatively is not available, the conceptual

framework of the test provides a useful methodological tool

for gathering and analyzing evidence pertinent to customer

substitution and to market definition.” (Doc. # 114-2 at 17

n.73). Elaborating on this, Dr. Lamb testified that he used

a “nonquantitative approach” to a SSNIP analysis that looked

at “practical indicia of economic substitutability, price

base substitutability, or the lack thereof.” (Doc. # 114-3 at

93).

Intuitive argues that, while SSNIP is an accepted

methodology, “Dr. Lamb did not perform the accepted version

of the test, but instead performed his own version based on

‘practical indicia’ instead of actual pricing data.” (Doc. #

114 at 6).

But Rebotix points out that where the market is dominated

by one company – as Intuitive does here by holding a 99

percent market share in MIST robots – and that company does

not frequently change its prices, sufficient price change

data is often unavailable. (Doc. # 145 at 1). It is for this

reason that Dr. Lamb conceded he did not include any analysis

of pricing data or any calculations regarding cross-

elasticity of demand or supply, because “it wasn’t necessary

to do so.” (Doc. # 114-3 at 93-95). Dr. Lamb testified that:

[S]tudies on cross-price elasticity of demand as an

approach to performing quantitative versions of the

SNNIP analysis are fraught with problems,

particularly when you have a firm with a large

degree of monopoly power such as Intuitive has in

the market for MIST surgical robots. Those kinds of

analyses are often subject to something we call the

Cellophane Fallacy, which is that they are

measuring a world which is already monopoly-

pricing, and so trying to tease out what would

happen to the equilibrium when you’re already at

monopoly equilibrium is problematic. But it wasn’t

necessary and is not necessary to do a cross price

elasticity econometric study to apply a SNNIP

framework by looking at practical indicia, as I

quoted a few moments ago from Footnote 73 in my

report, citing the merger guidelines, and as I talk

about it in my report itself.

(Id. at 94).

While Intuitive takes issue with how Dr. Lamb applied

(or misapplied) the typical SSNIP test, it appears to the

Court that Dr. Lamb did not use a typical SSNIP test because

the market at issue did not call for one. As the Eleventh

Circuit has explained, while measures of supply and demand

elasticities are the “most accurate estimates of relevant

markets . . . it is ordinarily quite difficult to measure

cross-elasticities of supply and demand accurately.

Therefore, it is usually necessary to consider other factors

that can serve as useful surrogates for cross-elasticity

data”. U.S. Anchor, 7 F.3d at 995; see also McWane, Inc. v.

F.T.C., 783 F.3d 814, 829 (11th Cir. 2015) (explaining that

econometric analysis of relevant markets is not “always

required” and “courts routinely rely on qualitative economic

evidence to define relevant markets”). Thus, in addition to

the cross-elasticity of demand and supply, the Eleventh

Circuit has long looked to the factors (or “practical

indicia”) set forth by the Supreme Court in Brown Shoe Co. v.

United States, 370 U.S. 294, 325 (1962), in defining a

relevant market or submarket: “industry or public recognition

of the submarket as a separate economic entity, the product’s

peculiar characteristics and uses, unique production

facilities, distinct customers, distinct prices, sensitivity

to price changes, and specialized vendors.” U.S. Anchor, 7

F.3d at 995.

Here, Dr. Lamb used the SSNIP analytical framework from

which to build his opinions based on other evidence, like

testimony and business records (the “practical indicia” cited

in his testimony). And the facts Dr. Lamb considered align

with the factors enunciated in U.S. Anchor. For example, Dr.

Lamb considered customers’ “sensitivity to price changes”

when he looked at testimony from hospital administrators that

a 5-10% increase in price would not lead them to substitute

non-robotic surgeries for surgeries conducted using the da

Vinci robot. He also considered MIST robots’ distinct

characteristics and uses, including the increased dexterity

and precision enjoyed by surgeons using MIST robots and the

benefits to patients, which include less scarring and a

quicker recovery time.

Changing tactics, Intuitive next argues that Dr. Lamb’s

analysis of “practical indicia” is “devoid of evidentiary

support,” because Dr. Lamb has no evidence to support his

contention that the da Vinci’s competitors – the MIST robots

made by two other companies – are able to “discipline pricing”

for the da Vinci.

As explained above, antitrust plaintiffs must define a

relevant product market, which must “encompass the product at

issue as well as all economic substitutes for the product.”

Newcal Indus., Inc. v. Ikon Office Sol., 513 F.3d 1038, 1045

(9th Cir. 2008). Including economic substitutes ensures that

the relevant product market encompasses the sellers or

producers who have the actual or potential ability to deprive

each other of significant levels of business. Pistacchio v.

Apple Inc., No. 4:20-cv-07034-YGR, 2021 WL 949422, at *1 (N.D.

Cal. Mar. 11, 2021).

Here, Dr. Lamb identified several potential economic

substitutes for surgeries performed with MIST robots – such

as traditional laparoscopic surgeries and non-MIST surgical

robots – but rejected them for various reasons. As detailed

in his report, only two other surgical robots (TransEnterix’s

Senhance robot and Medrobotics’ Flex robot) currently have

FDA approval to perform minimally invasive soft tissue

surgeries in the United States. (Doc. # 114-2 at 30 n.119).

And neither of these competitors are FDA approved “for all

the same indications” as the da Vinci. (Id.). Even including

the Senhance and Flex within the relevant product market, the

da Vinci still holds a 99.5% market share in the MIST robot

market. (Id. at 50-51). Dr. Lamb explained during his

deposition that when there is a “dominant firm in the market

with more than 99 percent market share, it’s going to take

some period of time before the behavior of a new competitor

can discipline the prices that dominant firm is going to

charge.” (Doc. # 114-3 at 124-26, 129-32). And because the

Flex and Senhance are still “nascent competitors” with “very

little market penetration,” “their ability to discipline

[prices] . . . has not yet developed.” (Id. at 110-11, 121).

Still, he included the Senhance and Flex robots within the

relevant product market definition because those competitors

“are attempting to enter that market and . . . I would expect,

if they were able to enter the market and overcome the

barriers to entry that are significant there, that they would

be able to discipline pricing.” (Id. at 108).

The Court finds Dr. Lamb’s methodology sufficiently

reliable. Any alleged flaws in Dr. Lamb’s methodology should

be addressed in cross-examination. See Maiz v. Virani, 253

F.3d 641, 666 (11th Cir. 2001) (“Vigorous cross-examination,

presentation of contrary evidence, and careful instruction on

the burden of proof are the traditional and appropriate means

of attacking [debatable] but admissible evidence.” (citations

and internal quotation marks omitted)).

2. Relevant antitrust product market for

EndoWrist Repair and Replacement

Intuitive argues that Dr. Lamb’s opinion defining the

EndoWrist Repair and Replacement Market should be excluded

because (1) defining this market from the supplier’s

(Rebotix’s) point of view is contrary to law; and (2) he

relied on the opinions of two other experts – Dr. T. Kim

Parnell and Mr. J. Lawrence Stevens – whose own opinions are

allegedly inadmissible. (Doc. # 114 at 3-4, 11-13).

In his report, Dr. Lamb concluded that the market for

EndoWrist repair and replacement – which Rebotix claims is

unlawfully tied to the sales of da Vinci surgical robots – is

itself a relevant antitrust product market that is distinct

from the market for MIST surgical robots. (Doc. # 114-2 at

32-33). Dr. Lamb concluded that because there are no

functional substitutes for the repair and replacement of

EndoWrist surgical instruments, there are therefore no

economic substitutes either. (Id. at 33). In reaching this

conclusion, Dr. Lamb relied on the following evidence: (1)

third-party repairs of EndoWrist instruments were viewed by

Intuitive and other market participants as a competitive

threat to Intuitive’s sale of replacement EndoWrists; and (2)

in response to the competitive threat posed by third-party

repairs, Intuitive investigated the possibility of selling

refurbished EndoWrists at a discount from the cost of

replacement EndoWrists. (Id. at 33-37).

First, Intuitive’s argument that the market must be

defined from the perspective of the supplier is incorrect for

the reasons explained in the Court’s contemporaneous Order on

the parties’ cross motions for summary judgment. Furthermore,

in defining the relevant market from the perspective of the

hospital customers, Dr. Lamb relied on multiple, unchallenged

bases to support this opinion: (1) Intuitive and third parties

viewed “repair” businesses like Rebotix as a competitive

threat to Intuitive’s sales of replacement EndoWrists; (2)

Intuitive at one point considered selling refurbished

EndoWrists to edge repair companies out of competition; and

(3) only da Vinci EndoWrists are compatible with da Vinci

surgical robots. (Doc. # 114-2 at 32-40).

The Motion is denied as to this point, but Intuitive may

raise its challenges to Dr. Lamb’s methodology during cross-

examination.

3. Whether Intuitive has possessed and exercised

monopoly power in the relevant markets

A monopolization claim under Section 2 of the Sherman

Act is comprised of two elements: “(1) the possession of

monopoly power in the relevant market and (2) the willful

acquisition or maintenance of that power as distinguished

from growth or development as a consequence of a superior

product, business acumen, or historic accident.” Morris

Commc’ns Corp. v. PGA Tour, Inc., 364 F.3d 1288, 1293-94 (11th

Cir. 2004) (quoting United States v. Grinnell Corp., 384 U.S.

563, 570-71 (1966)). “The first element, monopoly power, is

the power to control prices in or to exclude competition from

the relevant market.” Id. at 1294 (internal citation

omitted).

In his report, Dr. Lamb explains that “monopoly power

refers to the ability of a firm to persistently price at a

level that is significantly higher than the competitive

price.” (Doc. # 142-2 at 46). He opines that Intuitive

possessed monopoly power in the “tying market” (the market

for MIST robots) and, thus, was able to set prices above

competitive levels. (Id. at 47). In support of this opinion,

he discussed how Intuitive “dominated” the market for MIST

robots in the United States, having a 99.5% market share.

(Id. at 50-51). In addition, Dr. Lamb cited “significant

barriers to entry” into the market for MIST robots, including

high costs for customers to switch robots and regulatory

hurdles. (Id. at 52). There are also high capital costs for

research and development and lengthy time requirements for

FDA approval. (Id. at 53-54). And Intuitive’s deep

penetration of the market means that many surgeons are trained

on, and feel most comfortable with, a da Vinci system. (Id.

at 55-56).

Importantly, Dr. Lamb also discussed how Intuitive’s

prices for da Vinci robots “exceeded marginal costs.” (Id. at

58). As he explained in his report, “[o]ne measure of market

power is the ability of a firm to price in excess of marginal

cost” because, in a competitive market, price equals marginal

cost. (Id.). Dr. Lamb cited evidence that Intuitive enjoyed

“extremely high profit margins on da Vinci surgical robot

sales.”2 (Id. at 60).

Dr. Lamb also opined that Intuitive possessed and

exercised monopoly power in the “tied market” (the EndoWrist

Repair and Replacement Market), as supported by the fact that:

(1) despite in-roads from third parties like Rebotix,

Intuitive retained a large market share in the EndoWrist

Repair and Replacement Market; (2) Intuitive prevented rivals

like Rebotix from competing effectively in this market

through its use of restrictive contracts with customers and

cease and desist letters; (3) the prices for EndoWrist

surgical instruments which Intuitive supplied were set well

above marginal costs and at “supracompetitive” levels. (Id.

at 65-73).

Intuitive argues that the Court should exclude Dr.

Lamb’s opinions with respect to Intuitive’s monopoly powers

in the relevant markets. According to Intuitive, Dr. Lamb’s

2 While Dr. Lamb provided precise profit margin percentages

in his report, the Court notes that the parties have chosen

to redact this information from their motions, and thus the

Court will also avoid using precise profit-margin numbers.

opinion that Intuitive exercised monopoly power by charging

“supracompetitive” prices is contrary to law in that Dr. Lamb

failed to consider Intuitive’s total costs (fixed and

marginal costs). (Doc. # 114 at 4, 15-16).

Federal district courts are split on whether fixed (or

sunk) costs should be taken into account, especially in

innovation-intensive industries like pharmaceuticals or, as

here, high-tech medical devices. Compare In re Solodyn

(Minocycline Hydrochloride) Antitrust Litig., No. CV 14-MD-

02503, 2018 WL 563144, at *11 (D. Mass. Jan. 25, 2018)

(finding that sunk costs “are relevant to the inquiry because

in a market with high fixed costs like the pharmaceutical

industry, ‘even competitive prices may exceed marginal

cost’”) with In re Aggrenox Antitrust Litig., 199 F. Supp. 3d

662, 667 (D. Conn. 2016) (rejecting brand manufacturers’ sunk

costs argument because the fact that “brand manufacturers

incur enormous fixed costs developing and marketing new drugs

. . . does not mean that the price of the brand drug is not

supracompetitive,” and stating that the “generally accepted

economic means of analyzing the probability that given prices

are supracompetitive [is] using price and marginal cost”).

The Court need not take a stance on this issue in any

event, because Dr. Lamb testified that even taking into

account additional costs like research and development,

Intuitive’s profit margins are above 20 percent, which is

still “quite high.” (Doc. # 114-3 at 149-50). Any flaws in

his methodology may be explored on cross-examination. The

Motion is denied on this ground.

4. Whether Intuitive’s challenged conduct has produced

anticompetitive effects

In his report, Dr. Lamb states that Intuitive’s alleged

misconduct (the agreements with hospitals prohibiting repair

of EndoWrists, the cease-and-desist letters, the threats to

discontinue servicing) “was anticompetitive because it

resulted in higher prices for products in the (tied) market

than otherwise would have prevailed.” (Doc. # 114-2 at 45).

According to Dr. Lamb, “hospitals had little choice but to

pay higher prices for replacement EndoWrist surgical

instruments from Intuitive in order to use their da Vinci

surgical robots than they otherwise would have had they been

able to repair their EndoWrist surgical instruments through

third-party repair companies such as Rebotix.” (Id. at 5).

Intuitive argues that Dr. Lamb’s opinion that

Intuitive’s challenged conduct has caused anticompetitive

effects is contrary to law. Specifically, Intuitive claims

that the law requires Rebotix to prove that the combined price

for a da Vinci robot and EndoWrists was greater than it would

have been if they had been sold independently. Dr. Lamb did

not analyze this issue. Instead, he opined that some customers

would have paid less for Rebotix’s services in the “but-for”

world (i.e., without the alleged tying arrangement) than they

paid to buy new EndoWrists from Intuitive in the actual world.

(Doc. # 114 at 4-5).

The Court rejects this argument for the reasons

explained in its accompanying summary judgment order.

Accordingly, it is hereby

ORDERED, ADJUDGED, and DECREED:

Defendant Intuitive Surgical, Inc.’s Daubert Motion to

Exclude the Opinions of Dr. Russell Lamb (Doc. # 114) is

DENIED.

DONE and ORDERED in Chambers in Tampa, Florida, this

10th day of August, 2022.

VIR IA M. HERNANDEZ’COVINGTON

UNITED STATES DISTRICT JUDGE

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