Philadelphia/New York, Nov. 8 (Reuters): Medical device maker Guidant Corp. sued to force Johnson & Johnson complete an agreed $25.4 billion takeover, posted lower third-quarter profits and reported a widening investigation by federal investigators.

J&J retorted saying that Guidant’s recent recalls of heart devices and regulatory probes materially hurt the company’s value. As a result, under the terms of its merger agreement, it was not required to complete the deal. Guidant said its recent problems were short-term and business fundamentals remained strong.

Guidant, which also is the subject of shareholder lawsuits, has faced scrutiny in recent months over its failure to inform doctors about potential defects in some of its implantable devices.

It further said the US Securities and Exchange Commission has launched a formal inquiry into its product disclosures and share trading.

Separately, J&J said it received a subpoena from the US Attorney’s Office seeking documents related to the sales and marketing of eight drugs to Omnicare Inc.

Whitney Smith, a partner at law firm Kirkpatrick & Lockhart, said the Guidant-J&J legal battle would hinge on whether there had been sufficient damage or a “material adverse change” in Guidant’s business, that would legally allow J&J to scrap the deal.