Failed Guidant suitor sues rival

Johnson & Johnson is suing rival Boston Scientific for $5.5 billion over the acquisition of medical device maker Guidant. The acquisition included Guidant's cardiac rhythm management division in Arden Hills.

Boston Scientific acquired Guidant for $27 billion after a bidding war with Johnson & Johnson.

In a suit filed Monday in a New York federal court, Johnson & Johnson said the deal was tainted by a leak of confidential information to Abbott Laboratories. The suit alleges that the leak led to Abbott's purchase of some of Guidant's business, helping Boston Scientific skirt antitrust hurdles.

David Heupel, an analyst with Thrivent Financial, says he doesn't fully understand Johnson & Johnson's decision to sue, given that the combined Boston Scientific and Guidant aren't doing that well.

"I'd be more inclined to see if the subsequent acquired company was doing really well," Heupel says, "and that's not the case right now. Boston Scientific's stock is at multi-year lows right now, and they just lowered guidance on the two primary business lines they acquired."

Johnson & Johnson and Boston Scientific did not return calls for comment. Boston Scientific told Bloomberg News that the suit against the company is meritless.