Angeion Receives Positive Ruling in Insurance Coverage Case
SAINT PAUL, MN — (MARKET WIRE) — 02/27/2006 — Angeion Corporation
(NASDAQ: ANGN) announced today, that in an Order dated February 17, 2006,
Judge David S. Doty of the United States District Court for the District of
Minnesota granted, in large part, Angeion’s motion for summary judgment in
the pending lawsuit Medmarc Casualty Insurance Company v. Angeion
Corporation, ELA Medical, Inc. and ELA Medical SA.

In summary, the Court ruled that:

– The June 2005 settlement between Angeion and ELA Medical under which
Angeion agreed to pay ELA $1.4 million to settle the claims arising out
of
the recall of Angeion’s implantable cardioverter defibrillators (”ICDs”)
was reasonable, non-collusive and made in good faith;
– Medmarc has a duty to indemnify Angeion for the $1.4 million
settlement, plus interest from June 30, 2005;
– The Court stated that 32 of the 160 ICDs that were explanted did not
meet specified voltage levels to warrant recall and therefore the
“device
costs” and “ELA expenses” associated with those 32 ICDs were not covered
by
the policy. The Court stated it could not make a specific determination
with respect to that portion, if any, of the $1.4 million settlement
that
pertains to device costs and ELA expenses with respect to those 32 ICDs.
This matter, therefore, remains subject to future determination by the
Court or resolution by Angeion and Medmarc.
– Angeion is entitled to recover from Medmarc costs and fees in the
amount of $49,353.10 incurred in defending ELA’s claims.
On August 25, 2005, the Court had found that Medmarc had a duty to
defend Angeion and had breached that duty.
On June 30, 2005, Angeion had entered into settlement agreements with ELA
Medical, Inc. and ELA Medical S.A.S. (together “ELA”) that ended the legal
dispute and lawsuit by ELA against Angeion and resolved all litigation and
other issues between Angeion and ELA related to recall of the ICDs and
reimbursement of expenses incurred by ELA. Under the terms of the settlement
agreement and release regarding LYRA ICDs, ELA agreed to settle its $2.0
million plus cross-claim against Angeion in return for an Offer of Judgment
on ELA’s cross-claim in favor of ELA and against Angeion in the amount of
$1.4 million. The judgment was subsequently entered by the Court and has
been satisfied by Angeion.

“We are pleased that the Judge’s Order affirms our position that the
settlement was reasonable, non-collusive and made in good faith,” stated
Rodney A. Young, Angeion’s President and Chief Executive Officer. Young
added, “Although the Court’s Order has left a few matters open, we believe
that issuance of this Order validates Angeion’s actions and we hope this
matter can be resolved in the near future. In connection with the matter,
Angeion also intends to ask the Court to require Medmarc to reimburse
Angeion for its legal expenses incurred in connection with defending the
action brought by Medmarc and establishing the duty to defend and the duty
to indemnify.” Young also noted that Angeion believed its existing
accounting accruals for discontinued operations are consistent with the
Court’s opinion and that no adjustments would be required at this time.

Founded in 1986, Angeion Corporation acquired Medical Graphics
(www.medgraphics.com) in December 1999. Medical Graphics develops,
manufactures and markets non-invasive cardiorespiratory diagnostic systems
for the management and improvement of cardiorespiratory health. The Company
has also introduced a line of health and fitness products, many of which are
derived from Medical Graphics’ cardiorespiratory product technologies. These
products, marketed under the New Leaf Health and Fitness brand
(www.newleaffitness.com), help consumers effectively manage their weight and
improve their fitness. They are marketed to the consumer primarily through
personal training studios, health and fitness clubs and other exercise
facilities