U.K. official admits he spoke briefly to Porton CEO about 3M battle

The strange battle between 3M and the Porton Group just got odder. Liam Fox, the U.K.'s defense secretary, is now backtracking on a claim that he never had any discussions about the legal battle with Porton CEO Harvey Boulter.

Fox had denied that he and Boulter had discussed a plan to resolve the snowballing legal dispute during a meeting in Dubai. But hours after the meeting, Boulter in an email allegedly threatened the company's business in the U.K., as well as the knighthood of the conglomerate's British-born CEO, George Buckley. The move prompted the company to bring a blackmail lawsuit in the U.S.

Porton Group, a private equity firm, has been accusing 3M of breaching its obligation on BacLite, a product designed for detecting MRSA in hospitals. Back in 2007, 3M spent $20.4 million to acquire the BacLite, which incorporated technology developed for the British military to detect an attack by biological weapons, from Acolyte Biomedica. It subsequently cited disappointing trial results as the reason for abandoning the product. But Portman suspected the conglomerate mismanaged the trials to protect Fastman, a 3M-developed detection product, from the less expensive BacLite. It then sued 3M in the U.K.

Earlier this summer, 3M fired back by filing a suit maintaining Boulter tried to extort $30 million from the manufacturer. The company says Boulter at the time admitted in an email that 3M may indeed prevail in the U.K. trial. However, even if it were to prevail, it would win the battle while losing the war. Indeed, a 3M victory "might leave [the British Government] quietly seething, with ramifications for a while--they have memories like elephants," 3M maintains court documents. But if 3M were to settle the case for $30 million, it would allow the Defense Ministry to "internally save face," Boulter allegedly said.

And now, despite previous denials, Fox has admitted he and Boulter did briefly talk about the case. Fox had been approached by the Guardian with statements from two witnesses who said the discussions had indeed taken place. "During their meeting Mr. Boulter disclosed his involvement in a legal case as a matter of propriety," a spokesperson for Fox said, as quoted by the Guardian. "But Dr. Fox did not enter into a discussion about this in any respect and at no point raised or discussed the issue of a knighthood."

3M lawyers are keen on having Fox provide evidence. If he appears, Fox would be the first serving British cabinet minister to give evidence in a serious legal case in the U.S.

- get more from the Guardian

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