Issue link: http://catalog.e-digitaleditions.com/i/114936
The measurement periods for each of the 2011 acquisitions were finalized in 2012 and did not differ materially from the preliminary allocations. NOTE 5 - GOODWILL AND OTHER INTANGIBLE ASSETS We completed our annual impairment tests of goodwill and concluded that no impairments exist. The changes in the net carrying value of goodwill by segment are as follows: Reconstructive Balance as of January 1, 2011 Goodwill acquired Foreign currency translation effects and other Balance as of December 31, 2011 Goodwill acquired Foreign currency translation effects and other Balance as of December 31, 2012 $ 464 $ 225 (4) 685 8 (2) 691 $ $ Neurotechnology and Spine MedSurg 508 $ 11 (9) 510 ��� 3 513 $ Total 100 $ 788 (11) 877 67 (6) 938 $ 1,072 1,024 (24) 2,072 75 (5) 2,142 The following is a summary of our other intangible assets: Gross Carrying Amount 2012 Intangible assets: Developed technologies Customer relationships Patents Trademarks In-process research and development Other $ $ Less Accumulated Amortization 2012 2011 2011 1,069 563 230 69 86 105 2,122 $ 990 562 224 69 47 127 2,019 $ 282 147 182 31 ��� 56 698 $ $ Net Carrying Amount 2012 222 115 169 32 ��� 39 577 $ 2011 $ 787 416 48 38 86 49 1,424 $ 2015 2016 768 447 55 37 47 88 1,442 The estimated amortization expense for each of the next five years is as follows: 2013 Estimated amortization expense $ 117 $ 2014 116 $ 114 $ 114 $ 2017 113 NOTE 6 - CONTINGENCIES AND COMMITMENTS We are involved in various ongoing proceedings, legal actions and claims arising in the normal course of business, including proceedings related to product, labor and intellectual property and other matters. The outcomes of certain of these matters will not be known for prolonged periods of time. In certain of the legal proceedings, the claimants seek damages, as well as other compensatory and equitable relief, that could result in the payment of significant claims and settlements and/or the imposition of injunctions or other equitable relief. For legal matters for which management has sufficient information to reasonably estimate our future obligations, a liability representing management's best estimate of the probable loss, or the minimum of the range of probable losses when a best estimate within the range is not known, for the resolution of these legal matters is recorded. Estimates are based on consultation with legal counsel, previous settlement experience and settlement strategies. If actual outcomes are less favorable than those projected by management, additional expense may be incurred, which could unfavorably affect future operating results. To partially mitigate losses arising from unfavorable outcomes in such matters, we purchase third-party insurance coverage subject to certain deductibles and loss limitations. Future operating results may be unfavorably impacted by any settlement payments or losses beyond the amounts of insurance carried. In addition, such matters may negatively impact our ability to obtain cost effective thirdparty insurance coverage in future periods. On June 28, 2012 we voluntarily recalled our Rejuvenate and ABG II modular-neck hip stems and terminated global distribution of these hip products. We notified healthcare professionals and regulatory bodies of this recall, which was undertaken due to potential risks associated with fretting and/or corrosion that may lead to adverse local tissue reactions. Product liability lawsuits relating to this voluntary recall have been filed against us. As previously announced, we intend to reimburse implanted patients for reasonable and customary costs of testing and treatment services, including any necessary revision surgeries. We continue to work with the medical community to evaluate the data and further understand this matter and the associated costs. The ultimate total cost with respect to this matter will depend on many factors that are difficult to predict with the limited information received to date and may vary materially based on the number of and actual costs of patients seeking testing and treatment services, the number of and actual costs of patients requiring revision surgeries, the number of and actual costs to settle lawsuits filed against us, and the amount of third-party insurance recoveries. Based on the information that has been received, we estimate the probable loss to resolve this matter to be in the range of approximately $190 to $390, before third-party insurance recoveries. Accordingly, in December 2012 we recorded a charge to earnings of $174 representing the excess of the $190 minimum of the range over the previously recorded reserves. No contingent gain 32 Dollar amounts in millions except per share amounts or as otherwise specified