Abbott Point of Care Inc. v. Epocal, Inc.

Filing 288

MEMORANDUM OPINION and ORDER that Epocal's motion to exclude evidence and argument that Abbott has been harmed by Epocal's alleged conduct is GRANTED inpart and DENIED in part, Epocal's motion to exclude evidence and argument regarding its FDA 510(k) submissions is GRANTED, Epocal's motion to exclude documents that use certain claim terms outside the context of the patents-in-suit is DENIED, Epocal's motion to exclude arguments and evidence regarding solicitation of empl oyees other than the five at issue in Abbott's tortious interference allegations is DENIED, Epocal should present this court and opposing counsel a draft of a proposed limiting instruction by 4/20/2012, objections no later than 4/23/2012; as more fully set out in order. Signed by Judge C Lynwood Smith, Jr on 4/18/2012. (AHI)

FILED
2012 Apr-18 PM 03:22
U.S. DISTRICT COURT
N.D. OF ALABAMA

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ALABAMA
NORTHEASTERN DIVISION
ABBOTT POINT OF CARE,
INC.,
Plaintiff,
vs.
EPOCAL, INC.,
Defendant.

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Civil Action No. CV-08-S-543-NE

MEMORANDUM OPINION AND ORDER ON MOTIONS IN LIMINE BY
DEFENDANT EPOCAL, INC.
This opinion addresses the following motions in limine filed by defendant,
Epocal, Inc. (“Epocal”): i.e., (1) motion to exclude evidence and argument that
plaintiff, Abbott Point of Care, Inc. (“Abbott” or, as plaintiff’s counsel prefer,
“APOC”) has been harmed by Epocal’s alleged conduct;1 (2) motion to exclude
evidence and argument regarding Epocal’s federal Food and Drug Administration
510(k) submissions;2 (3) motion to exclude documents that use certain claim terms
outside the context of the patents-in-suit;3 and (4) motion to exclude arguments and
evidence regarding solicitation of employees other than the five at issue in Abbott’s

1

Doc. no. 244.

2

Doc. no. 245.

3

Doc. no. 246.

tortious interference allegations.4
I. EPOCAL’S MOTION TO EXCLUDE EVIDENCE AND ARGUMENT
THAT ABBOTT HAS BEEN HARMED BY EPOCAL’S ALLEGED
CONDUCT
This court entered an order on March 22, 2010, granting the parties’ joint
motion to bifurcate the trial and to stay discovery on the bifurcated issues. That order
stated, in pertinent part:
Pursuant to Federal Rule of Civil Procedure 42(b), it is
ORDERED that this litigation shall be divided into two phases. During
Phase One, the parties shall litigate the issues of patent infringement
liability, patent infringement willfulness, patent infringement injunctive
relief, and tortious interference liability (except for any element of proof
related to the “fact of damages”). If plaintiff should prevail on any of
the foregoing issues, then, during Phase Two, the parties shall litigate
the issues of patent infringement damages, any remaining tortious
interference liability (e.g., the “fact of damages”), tortious interference
damages, and tortious interference injunctive relief.5
The order also stated that discovery should proceed with regard to all issues covered
in Phase One, but that discovery on all issues reserved for consideration in Phase Two
would be stayed, pending a determination on the issues covered in Phase One.6
Epocal now seeks to exclude from presentation to the jury “all evidence that Abbott
has been harmed, or perceives that it has been harmed, in any way by Epocal’s

4

Doc. no. 247.

5

Doc. no. 117, at 1-2 (footnote omitted).

6

Id. at 2.
2

alleged infringement of the asserted patent claims or by Epocal’s employment of five
former APOC employees,” because any such evidence would contravene the court’s
bifurcation order.7 More specifically, Epocal points to several items identified on
Abbott’s March 22, 2010 exhibit list, including
an Epocal market analysis [PX 154], APOC “Capital IQ” financial
information [PX 273], sales projections for the i-Stat device [PX 354],
customer lists [PX 355], an Epocal email to a potential customer that
was passed along to APOC [PX 356], a list of APOC accounts “lost” to
Epocal [PX 395], APOC customer revenue and sales volume [PX 432],
APOC emails regarding meetings with APOC customers or potential
customers [PX 403 & 438] and emails concerning competition with
Epocal [PX 416 & 418], agreements between Epocal and its customers
PX 325, 326, 327, & 328], and similar information. The list also
includes documents concerning Epocal’s relationship and agreements
with Alere, and Alere’s financial information [PX 449, 450, & 451].8
Epocal also points to two individuals named on Abbott’s March 22, 2010 witness list:
i.e., Lisa Reece, who “may have discoverable information regarding both the use and
sale of Abbott and i-STAT products, as well as Abbott’s competition with other
entities, such as Epocal,” and Greg Arnsdorf, who “is involved in marketing.”9
Epocal asserts that this evidence could only be relevant to the issue of whether
Abbott was harmed, or perceived that it was harmed, by Epocal’s alleged misconduct,

7

Doc. no. 244, at 1.

8

Id. at 3-4 (citations to Epocal’s exhibits omitted and replaced with bracketed alterations
showing the numbers assigned by plaintiff’s counsel).
9

Id. at 4.
3

and for that reason it should be excluded from this phase of the trial, during which the
jury will only be considering the issues of patent infringement liability, patent
infringement willfulness, and tortious interference liability, exclusive of any element
or proof related to the “fact of damages.” Moreover, Epocal alleges that, even if some
of the proposed evidence might be relevant to the issue of patent infringement
injunctive relief, it should not be presented to the jury, because the issue of injunctive
relief will be decided by the court, not the jury, and all evidence related to that issue
will be presented at a later hearing, after the conclusion of the jury trial.
The court agrees that evidence of harm or perceived harm suffered by Abbott
should not be presented to the jury during the “Phase One” trial, because any such
evidence would contravene the court’s bifurcation order, confuse the jury, and cause
undue prejudice to Epocal’s defense. Abbott does not even contest this central
point.10 Indeed, Abbott admits that most of the exhibits cited by Epocal in its motion
were only included in its trial exhibit list “for use at the post-trial injunctive
hearing.”11 Therefore, Epocal’s motion will be granted as to those documents
identified as Plaintiff’s Exhibits (“PX”) 273, 325-28, 354-56, 395, 403, 416, 418, 432,
10

Doc. no. 265 (Abbott’s Response to Epocal’s Motion In Limine to Exclude Evidence and
Argument that Abbott Has Been Harmed by Epocal’s Alleged Conduct), at 1 (“Abbott does not
intend to introduce at trial evidence related to the fact or amount of damages it has suffered as a
result of Epocal’s infringement and tortious interference; those are issues reserved for Phase II
proceedings.”).
11

Id.
4

438, and 449-51.
Even so, Abbott maintains that not all evidence “that might somehow involve
‘marketing,’ ‘customers,’ or ‘market competitive information’” should be excluded.12
Indeed, some of that evidence may be relevant to Epocal’s intent to harm Abbott,
which is an element of Abbott’s tortious interference claim, or to Epocal’s affirmative
defense of unclean hands, which rests on the theory that Abbott filed this lawsuit in
an effort to force Epocal out of the market.13 That may be, but is not necessarily, true.
Thus, to preclude plaintiff’s counsel from attempting to slip any of the excluded and
prejudicial evidence through the back door of trial, counsel must first approach the
bench and request a side-bar conference to discuss any of the foregoing evidence
before it may be referred to or offered in the presence of the jury.
II. EPOCAL’S MOTION TO EXCLUDE ARGUMENTS AND EVIDENCE
REGARDING EPOCAL’S FDA 510(k) SUBMISSIONS
In order to obtain approval from the federal Food and Drug Administration
(“FDA”) to market a new medical device, a company must submit a notification that
the device is “substantially equivalent” to one that is already on the market (the
“predicate device”). 21 U.S.C. § 360e(b)(1)(B). This notification is referred to as a
12

Id. at 2.

13

As the court already has decided in its memorandum opinion and order addressing Abbott’s
Motion In Limine to Preclude Epocal from Presenting its Equitable Defenses of Unclean Hands and
Equitable Estoppel to the Jury, Epocal will be permitted to present evidence regarding its affirmative
defenses of unclean and equitable estoppel to the jury in an advisory capacity.
5

“510(k) notification.”14

The terms “substantially equivalent” and “substantial

equivalence” have special meanings in the context of FDA 510(k) notifications.
They mean that
the device has the same intended use as the predicate device and that the
Secretary by order has found that the device —
(i) has the same technological characteristics as the
predicate device, or
(ii) (I) has different technological characteristics and the
information submitted that the device is substantially equivalent
to the predicate device contains information, including
appropriate clinical or scientific data if deemed necessary by the
Secretary or a person accredited under section 360m of this title,
that demonstrates that the device is as safe and effective as a
legally marketed device, and (II) does not raise different questions
of safety and effectiveness than the predicate device.
21 U.S.C. § 360c(i)(1)(A).
Epocal submitted a 510(k) notification to the FDA regarding the “EPOC Blood
Analysis System” in 2006.15 Epocal identified Abbott’s i-Stat Analyzer as a predicate
product, and it claimed that its own EPOC system was “substantially equivalent” to

14

“The [FDA’s] review of devices for substantial equivalence is known as the § 510(k)
process, named after the statutory provision describing the review.” Riegel v. Medtronic, Inc., 552
U.S. 312, 317 (2008). The referenced statutory provision is § 510(k) of the Federal, Food, Drug, and
Cosmetic Act, and it is codified at 21 U.S.C. § 360(k).
15

Doc. no. 250 (Memorandum in Support of Motion In Limine to Exclude Arguments and
Evidence Regarding Epocal’s FDA 510(k) Submissions), at Exhibit 2 (510(k) submission for EPOC
Blood Analysis System).
6

the i-Stat system.16 Epocal now seeks a ruling to prevent Abbott from using any
evidence regarding Epocal’s 510(k) submission. Epocal’s primary argument is that
Abbott should not be allowed to use such evidence to argue that Epocal’s device
infringes Abbott’s patents under the Doctrine of . In response, Abbott makes clear
that it will not be relying on the Doctrine of Equivalents to support its infringement
claims at trial.17
Despite that concession, Abbott goes on to argue that, even if it cannot rely on
Epocal’s 510(k) notification to support a Doctrine of Equivalents theory, it should,
nevertheless, be allowed to present evidence of factual statements made in Epocal’s
510(k) submission — and, in particular, statements about how Epocal’s device
functions — for impeachment and other purposes. Abbott also argues that Epocal’s
characterization of the Epocal system as “substantially equivalent” to the i-Stat
system is relevant, because Epocal’s expert witnesses have been permitted to testify
about comparisons between the i-Stat device and the EPOC system. According to
Abbott,
Epocal’s experts will likely testify that the Epocal System is different
from the i-Stat device manufactured by APOC. Contradictory
16

Id. at 5.

17

Doc. no. 267 (Abbott’s Response to Epocal’s Motion In Limine to Exclude Arguments and
Evidence Regarding Epocal’s FDA 510(k) Submissions), at 3 (“While Epocal states otherwise in its
Motion, Abbott had previously confirmed to Epocal, and has also indicated to the Court, that it is
not pursuing a Doctrine of Equivalents infringement theory in this case.”) (emphasis in original).
7

statements that Epocal made to the FDA comparing the two devices, and
concluding they are substantially equivalent, are therefore highly
relevant and probative. In particular, Abbott should not be precluded
from using such statements for impeachment purposes if Epocal
attempts to rely on device comparisons for its non-infringement
arguments.18
Abbott does not cite any authority to support its argument, and, unfortunately
for Abbott, there is ample authority supporting the opposite conclusion. The Federal
Circuit has cautioned that evidence supporting a finding of “substantial equivalence”
in the FDA 510(k) context should not be confused with the proof required to support
a claim of patent infringement under the Doctrine of Equivalents. Indeed, as the
Federal Circuit instructed in Abbott Laboratories v. Sandoz, Inc., 566 F.3d 1282 (Fed.
Cir. 2009):
While bioequivalency[19] may be relevant to the function prong of the
18

Id. at 5.

19

“Bioequivalency” is a pharmaceutical term used to assess the expected in vivo biological
equivalence of two proprietary preparations of a drug. If two products are said to be “bioequivalent,”
it means that they would be expected to be, for all intents and purposes, the same. The United States
Food and Drug Administration (FDA) has defined “bioequivalence” as referring to
the absence of a significant difference in the rate and extent to which the active
ingredient or active moiety in pharmaceutical equivalents or pharmaceutical
alternatives becomes available at the site of drug action when administered at the
same molar dose under similar conditions in an appropriately designed study.
21 C.F.R. § 320.1. See also, e.g., U.S. Dept. of Health & Human Services, Food and Drug Admin.,
Center for Drug Evaluation and Research, Guidance for Industry: Bioavailability and
Bioequivalence Studies for Orally Administered Drug Products — General Considerations, ¶ II(C)
at 4(Mar. 2003 ed., Rev. 1). A copy of that publication may be at found at www.fda.gov/downloads/
Drugs/GuidanceComplianceRegulatoryInformation/Guidances/ucm070124.pdf.
8

function-way-result test [for the Doctrine of Equivalents],
bioequivalency and equivalent infringement are different inquiries.
Bioequivalency is a regulatory and medical concern aimed at
establishing that two compounds are effectively the same for
pharmaceutical purposes. In contrast, equivalency for purposes of
patent infringement requires an element-by-element comparison of the
patent claim and the accused product, requiring not only equivalent
function but also equivalent way and result. Different attributes of a
given product may thus be relevant to bioequivalency but not equivalent
infringement, and vice versa.
Id. at 1298 (footnote, alteration, and emphasis supplied). See also, e.g., The Johns
Hopkins University v. Datascope Corp., 543 F.3d 1342, 1349 n.3 (Fed. Cir. 2008)
(“FDA equivalence is irrelevant to patent law because it involves fundamentally
different inquiries.”).
Thus, as the district court noted in Ethicon Endo-Surgery, Inc. v. Hologic, Inc.,
689 F. Supp. 2d 929 (S.D. Ohio 2010), “[s]everal district courts have held that it is
not proper to consider statements made in a FDA 510K notification.” Id. at 936
(citing Abbott Laboratories. v. Sandoz, Inc., 486 F. Supp. 2d 767, 776 (N.D. Ill.
2007); CardioVention, Inc. v. Medtronic, Inc., 483 F. Supp. 2d 830, 840 (D. Minn.
2007); Sunrise Med. HHG, Inc. v. AirSep Corp., 95 F. Supp. 2d 348, 405-06 (W.D.
Pa. 2000); and Univ. of Fla. Research Foundation, Inc. v. Orthovita, Inc., No.
1:96-cv-82-MMP, 1998 WL 34007129 (N.D. Fla. Apr. 20, 1998)).
Abbott points out that all of the cited cases excluding evidence of FDA 510(k)

9

submissions in patent infringement cases have done so in the context of a Doctrine
of Equivalents analysis. None of the cases explicitly state that the same evidence
could not be used for some other purpose, such as impeaching an expert witness, as
Abbott proposes that the testimony be used here. Even so, the court concludes that
the same reasons justifying exclusion of 510(k) evidence to support a theory of
infringement under the Doctrine of Equivalents also support excluding the evidence
for other purposes, including impeachment. Evidence of statements made and
product descriptions given by Epocal in its 510(k) notifications might have some
probative value for impeachment purposes, if Epocal attempts to offer a different
description of the design or function of its device at trial. But the risk for prejudice
and jury confusion as a result of that evidence is simply too high. There undoubtedly
are similarities between Abbott’s i-Stat device and Epocal’s EPOC device. If there
were not, Abbott’s infringement claims in this suit probably would be frivolous.
When Epocal was petitioning for FDA approval to market its device, it was in
Epocal’s best interest to highlight those similarities, so it could argue that its device
and Abbott’s i-Stat predicate device were “substantially equivalent.” But the standard
for “substantial equivalence” in the FDA-approval context is so different from the
standards for evaluating the similarity of inventions in the patent infringement context
that the jury could easily be confused about the significance of statements made to the
10

FDA. Specifically, the jury could be misled into believing that Epocal’s statements
to the FDA — even descriptive statements about the design and function of Epocal’s
device — are supportive of patent infringement. The jury also could be misled into
analyzing the evidence under something like a Doctrine of Equivalents theory, even
though no such theory actually is being asserted here.
Accordingly, all evidence regarding Epocal’s 510(k) submissions to the FDA
— including both descriptive statements about the EPOC device, and statements
about its “substantial equivalence” to Abbott’s i-Stat predicate device — will be
excluded. Abbott will not suffer undue prejudice as a result of this holding. If
Epocal’s expert witnesses testify that the EPOC system is different from the i-Stat
device manufactured by Abbott, Abbott is free to cross-examine those witnesses
using the testimony of its own expert witnesses, or the results of its own comparisons
of the two devices. In other words, it will not be necessary, for impeachment
purposes, for Abbott to show that Epocal gave a different description of its device,
in a different context, to a different government agency. The parties’ different
analyses of the two competing products can speak for themselves.
III. EPOCAL’S MOTION TO EXCLUDE DOCUMENTS THAT USE
CERTAIN CLAIM TERMS OUTSIDE THE CONTEXT OF THE
PATENTS-IN-SUIT
Epocal next asks the court to exclude from evidence certain internal documents
11

generated by Epocal during the design process for the EPOC device, as well as any
deposition testimony regarding those documents.20 According to Epocal,
[t]he documents at issue use words that happen to appear in the claim
terms of the asserted patent claims, such as “reservoir” and
“equilibrated.” These documents, however, predate the lawsuit and the
Court’s construction of the claim terms at issue. And for each of these
words, the Court’s claim construction adopted specific meanings that are
different from the sense that the words were being used in the Epocal
documents. Thus the documents themselves bear little, if any, probative
value of patent infringement.
This low probative value is substantially outweighed by the
danger of unfair prejudice and juror confusion from these, or similar,
exhibits or testimony. A jury seeing these terms used in Epocal’s
documents, [sic] may infer improperly that particular claim limitations
are satisfied simply because the wording in the documents is identical
or similar to certain claim terms, but without considering the very
specific requirements accorded the claim terms by the court’s claim
construction.21
In response, Abbott argues that Epocal’s own internal documentation is a valid
source of information about the design of the EPOC device and how it works.
Indeed, this court already decided in the memorandum opinion and order denying
Epocal’s Daubert motion to exclude the testimony of Dr. James Tusa, Abbott’s expert
witness, that Dr. Tusa was justified in relying upon Epocal’s internal experimental
20

Specifically, Epocal refers to the following documents: (1) PX 69, at pages E137990-99
(2) PX 72, at pages E149184-96; (3) PX 70, at pages EDHF002804-10; (4) PX 71, at pages
EDHF002811-16; and (5) PX 74, at EDHF004401-06, as well as any related deposition testimony
or other documents.
21

Doc. no. 248 (Epocal’s Memorandum in Support of its Motion to Exclude Documents that
Use Certain Claim Terms Outside the Context of the Patents-In-Suit), at 1.
12

data to form his opinions.22 Abbott also asserts that the internal Epocal documents
could be relevant for impeachment of Dr. Imants Lauks, Epocal’s founder, and
Epocal’s experts, Dr. William Olbricht and Dr. Ranil Wickramasinghe, who may offer
testimony that contradicts the information contained in the internal documents.
The court recognizes both the probative value of this evidence to Abbott’s case,
and the potential for unfair prejudice that could result to Epocal if the jury disregards
the court’s claim constructions due to the use of key words like “equilibration” or
“reservoir” in Epocal’s internal documents. The court concludes that the best
approach for balancing these two competing interests is that proposed by Epocal: i.e.,
Abbott will be permitted to present the contested documents to the jury, but the court
will issue a limiting instruction explaining that the use of terms like “reservoir,”
“equilibrate,” and “equilibration” in those documents is not necessarily consistent
with the court’s construction of those claim terms, and is not an admission by Epocal
that its device meets any of the limitations of the asserted claims. The court also will
remind the jury that they must apply the court’s construction of the claim terms — not
a construction of the terms that was used in some other context — to the Epocal
device to decide infringement.23 Thus, Epocal’s motion will be denied, and the court
22

Doc. no. 215 (Memorandum Opinion and Order on Daubert Motions), at 24-26.

23

See doc. no. 248, at 8. Epocal also asked the court to redact all references to the terms
“reservoir,” “equilibrate,” and “equilibration” in the questioned documents. Id. The court concludes
that measure is unnecessary and would only result in an incomplete understanding by the jury of the
13

will address some of Epocal’s concerns by use of a limiting instruction. Counsel for
Epocal should present this court and opposing counsel a draft of a proposed limiting
instruction on or before Friday, April 20, 2012. Any objection should be filed no
later than the following Monday, April 23, 2012.
IV. EPOCAL’S MOTION TO EXCLUDE ARGUMENTS AND EVIDENCE
REGARDING SOLICITATION OF EMPLOYEES OTHER THAN THE
FIVE AT ISSUE IN ABBOTT’S TORTIOUS INTERFERENCE
ALLEGATIONS
In support of its claim for tortious interference with contractual relationships,
Abbott alleges that Epocal successfully solicited five employees — Dan McLain,
Wendy Thompson, Mark Maund, Martin Bemer, and Peggy Wachowski — to
terminate their employment with Abbott and begin working for Epocal.24 Epocal
seeks to preclude Abbott from introducing evidence of any other employees who may
also have been approached by Epocal, but who did not ultimately terminate their
employment with Abbott.
Abbott uses its employee Lisa Reece as an example. On June 19, 2007, Jeff
Baker, an Epocal employee, sent Reece an e-mail stating, in pertinent part: “We
would like to try and recruit you to our company.” Baker stated in another e-mail
contents of the documents. The limiting instruction described above will be sufficient to eliminate
any unfair prejudice or jury confusion.
24

See doc. no. 1 (Complaint), at ¶¶ 62-68; doc. no. 269 (Abbott’s Amended Response to
Epocal’s Motion to Exclude Evidence and Argument Regarding Solicitation of Employees Other
Than the Five at Issue in Abbott’s Tortious Interference Allegations), at 2 n.1
14

sent to Reece the following day, June 20, 2007: “Seriously, I would like to hire you.
Things to think about? No company car, Large territory, Lower Base Salary but a
larger upside and stock at the ground floor. You would do well working with all of
us.”25 During her September 10, 2010 deposition, Reece testified that Jeff Baker
contacted her “periodically” to discuss her coming to work for Epocal. Reece sent
her resume to Baker in late 2007, and the two individuals met in person to discuss the
potential career move on three or four occasions. Epocal eventually made Reece a
verbal job offer that included a higher salary than she earned at Abbott, but Reece
rejected the offer because she felt Abbott was a good company to work for, and she
believed in the i-Stat product.26
Epocal asserts that this evidence — and any similar evidence regarding other
employees — should be excluded because it is not relevant to any fact in dispute, is
improper character evidence, is unfairly prejudicial to Epocal, and would mislead the
jury and confuse the issues. According to Epocal, any such evidence would “mislead
the jury into inferring that Epocal also tried to recruit the five Abbott employees
whom it hired.”27
The essence of Epocal’s arguments is Federal Rule of Evidence 404, which
25

Doc. no. 249, Exhibit 1 (Plaintiff’s Exhibit 400), at 1.

26

Doc. no. 249, Exhibit 2 (excerpts from the Deposition of Lisa Reece), at 235-40.

27

Doc. no. 249, at 2.
15

provides, in pertinent part, that: “Evidence of a person’s character or character trait
is not admissible to prove that on a particular occasion the person acted in accordance
with the character or trait.” Fed. R. Evid. 404(a). Under that rule, if Abbott was
offering the evidence about Lisa Reece and other employees to suggest to the jury
that, since Epocal (albeit unsuccessfully) attempted to recruit Reece, it must also have
recruited McLain, Thompson, Maund, Bemer, and Wachowski, it would be
inadmissible.
Abbott asserts, however, that evidence of Epocal’s alleged attempts to lure
other employees away from Abbott’s employment falls under an exception to Rule
404(a), allowing such evidence to be admitted for the purpose of proving a matter —
such as intent or motive — other than action in conformity with the actor’s alleged
character or prior bad actions. See Fed. R. Evid. 404(b)(2) (“This evidence may be
admissible for another purpose, such as proving motive, opportunity, intent,
preparation, plan, knowledge, identity, absence of mistake, or lack of accident.”).
The Eleventh Circuit has elaborated on that exception:
Subject to specific exceptions, Rule 404(b) provides that extrinsic
evidence is not admissible to prove defendant’s character in order to
show action in conformity therewith. Such evidence is, however,
admissible if it is relevant to other material issues in the case.
Specifically, the test for admissibility of extrinsic evidence under Rule
404(b) that we apply has three parts:

16

First, the evidence must be relevant to an issue other than
the defendant’s character. Second, as part of the relevance
analysis, the evidence must be sufficient to support a finding that
the defendant actually committed the extrinsic act. Third, the
probative value of the evidence must not be substantially
outweighed by unfair prejudice.
United States v. Calderon, 127 F.3d 1314, 1330-31 (11th Cir. 1997) (quoting United
States v. Diaz–Lizaraza, 981 F.2d 1216, 1224 (11th Cir. 1993), and citing United
States v. Beechum, 582 F.2d 898 (5th Cir.1978)28 (en banc), cert. denied, 440 U.S.
920 (1979)).
According to Abbott, evidence of Epocal’s attempts to lure other employees
away from Abbott could be relevant to prove Epocal’s intent and motive, both of
which are essential elements of its tortious interference claim. Under New Jersey law,
which the parties agree applies to Abbott’s tortious interference claim:
A complaint based on tortious interference must allege facts that
show some protectable right — a prospective economic or contractual
relationship. Although the right need not equate with that found in an
enforceable contract, there must be allegations of fact giving rise to
some “reasonable expectation of economic advantage.” Harris v. Perl,
[197 A.2d 359, 363 (N.D. 1964)]. A complaint must demonstrate that
a plaintiff was in “pursuit” of business. Second, the complaint must
allege facts claiming that the interference was done intentionally and
with “malice.” Louis Kamm, Inc. v. Flink, [175 A. 62, 66-67 (N.J. Err.
& App. 1934)]; Kopp, Inc. v. United Technologies, Inc., 223 N.J. Super.
548, 559, 539 A.2d 309 (App. Div. 1988); Levin v. Kuhn Loeb & Co.,
28

In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), the
Eleventh Circuit adopted as binding precedent all decisions of the former Fifth Circuit handed down
prior to the close of business on September 30, 1981.
17

174 N.J. Super. 560, 573, 417 A.2d 79 (App. Div. 1980) (applies New
York law). For purposes of this tort, “[t]he term malice is not used in the
literal sense requiring ill will toward the plaintiff.” Restatement
(Second) of Torts Chapter 37 at 5 (introductory note) (1979). Rather,
malice is defined to mean that the harm was inflicted intentionally and
without justification or excuse. Rainier’s Dairies v. Raritan Valley
Farms, Inc., 19 N.J. 552, 563, 117 A.2d 889 (1955). Third, the
complaint must allege facts leading to the conclusion that the
interference caused the loss of the prospective gain. A plaintiff must
show that “if there had been no interference[,] there was a reasonable
probability that the victim of the interference would have received the
anticipated economic benefits.” Leslie Blau Co. v. Alfieri, 157 N.J.
Super. 173, 185-86, 384 A.2d 859 (App. Div.), certif. denied sub nom.
Leslie Blau Co. v. Reitman, 77 N.J. 510, 391 A.2d 523 (1978). Fourth,
the complaint must allege that the injury caused damage. Norwood
Easthill Assocs. v. Norwood Easthill Watch, 222 N.J. Super. 378, 384,
536 A.2d 1317 (App. Div. 1988).
Printing Mart-Morristown v. Sharp Electronics Corp., 563 A.2d 31, 37 (N.J. 1989).
See also Deluxe Bldg. Systems, Inc. v. Constructamax, Inc., No. 06-2996(ES), 2012
WL 967362, at * 3-4 (D. N.J. March 21, 2012) (slip copy) (citing the same elements);
Gaelick v. Connecticut General Life Ins. Co., No. 11-2464(SRC), 2011 WL 3794228,
at *2 (D. N.J. Aug. 25, 2011) (slip copy) (same).
In the tortious interference context, “‘Interference is intentional “if the actor
desires to bring it about or if he knows that the interference is certain or substantially
certain to occur as a result of his action.”’” Gaelick, 2011 WL 3794228, at *3
(quoting Cedar Ridge Trailer Sales, Inc. v. National Community Bank of New Jersey,
312 N.J. Super. 51, 711 A.2d 338, 345 (N.J. Super. Ct. App. Div. 1998)). Thus,
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implicit in the meaning of the term “malice” in the context of a tortious interference
claim under New Jersey law is “acceptance of the principle that the requisite intent
may be either a specific intent to interfere with the contract or the taking of improper
action with knowledge that interference will probably result.” Velop, Inc. v. Kaplan,
693 A.2d 917, 926 (N.J. Super. Ct. App. Div. 1997).
The court agrees with Abbott that evidence of Epocal’s unsuccessful attempts
to hire away Abbott’s employees could be relevant to prove Epocal’s “intent” to hire
away the employees who actually are the subject of Abbott’s claim. Therefore, the
evidence could be admissible under Federal Rule of Evidence 404(b)(2), even if it
would otherwise be inadmissible under Rule 404(a) or 404(b)(1). Furthermore, such
evidence would be relevant to Abbott’s tortious interference claim, in that Epocal’s
alleged solicitation of Lisa Reece occurred during approximately the same time
period of its alleged solicitation of Dan McLain, Wendy Thompson, Mark Maund,
Martin Bemer, and Peggy Wachowski, and it happened in a similar manner: i.e., Jeff
Baker contacted some of the other employees on Epocal’s behalf, just as he had
contacted Lisa Reece. Finally, the court concludes that the risk of unfair prejudice
to Epocal if the jury hears such evidence does not outweigh the probative value of the
evidence to Abbott. If necessary, the jury can be provided with a limiting instruction
that the evidence should only be considered in determining Epocal’s intent, not to
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demonstrate that, just because Epocal may have attempted to hire away Reece, it also
attempted to hire away McLain, Thompson, Maund, Bemer, and Wachowski. See
Calderon, 127 F.3d at 1333 (holding that “any unfair prejudice that may have existed
was mitigated by the district judge’s limiting instruction”). Again, counsel for Epocal
should present this court and opposing counsel a draft of a proposed limiting
instruction on or before Friday, April 20, 2012. Any objection should be filed no
later than the following Monday, April 23, 2012.
In summary, Abbott will be permitted to present evidence regarding Epocal’s
alleged attempts to hire away Lisa Reece, as well as similar evidence regarding other
employees, as long as Epocal’s alleged solicitation of other employees occurred
during approximately the same time period, and in a similar manner, as the alleged
solicitation of the five employees made the basis of Abbott’s tortious interference
claim.
V. CONCLUSION AND ORDERS
In accordance with the foregoing, Epocal’s motion to exclude evidence and
argument that Abbott has been harmed by Epocal’s alleged conduct is GRANTED in
part, with regard to PX 273, 325-28, 354-56, 395, 403, 416, 418, 432, 438, and 44951. In all other respects, the motion is DENIED, but counsel are cautioned that they
must comply with all imitations on the presentation of evidence set forth in this
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memorandum opinion and order.
Epocal’s motion to exclude evidence and argument regarding its FDA 510(k)
submissions is GRANTED.

No evidence regarding Epocal’s FDA 510(k)

submissions will be allowed at trial by either party.
Epocal’s motion to exclude documents that use certain claim terms outside the
context of the patents-in-suit is DENIED, but a limiting instruction will be issued.
Counsel for Epocal should present this court and opposing counsel a draft of a
proposed limiting instruction on or before Friday, April 20, 2012. Any objection
should be filed no later than the following Monday, April 23, 2012.
Epocal’s motion to exclude arguments and evidence regarding solicitation of
employees other than the five at issue in Abbott’s tortious interference allegations is
DENIED, but a limiting instruction may be issued if necessary. Again, counsel for
Epocal should present this court and opposing counsel a draft of a proposed limiting
instruction on or before Friday, April 20, 2012. Any objection should be filed no
later than the following Monday, April 23, 2012.
DONE and ORDERED this 18th day of April, 2012.

______________________________
United States District Judge

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