G. David Jang v. Boston Scientific Scimed, Inc. et al

Filing 85

MEMORANDUM ORDER denying 77 SEALED MOTION for Reconsideration re 75 Judgment Plaintiff's Motion for Reconsideration, to Alter or Amend the Judgment, and for Leave to File an Amended Complaint. Signed by Judge Sue L. Robinson on 7/31/2012. (nmfn)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE

G. DAVID JANG, M.D.,

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Plaintiff,

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) Civ. No. 10-681-SLR

v.
BOSTON SCIENTIFIC SCIMED,
INC., a corporation; and
BOSTON SCIENTIFIC
CORPORATION, a corporation,
Defendants.

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MEMORANDUM ORDER
At Wilmington thisJ\'rday of July, 2012, having considered G. David Jang,
M.D.'s ("plaintiff's") motion for reconsideration, to alter or amend the judgment, and
motion for leave to file an amended complaint and the papers filed in connection
therewith;
IT IS ORDERED that said motion (D.I. 77) is denied, for the reasons that follow:
1. Introduction. On May 25, 2010 plaintiff filed a complaint against Boston
Scientific Scimed, Inc. ("Scimed") and Boston Scientific Corporation ("BSC")
(collectively, "defendants") alleging breach of contract, fiduciary duty, and implied
covenant of good faith and fair dealing, and seeking enforcement of an equitable lien.
(D. I. 1) The complaint was filed in the United States District Court for the Central
District of California and was subsequently transferred to this court on August 9, 2010.
(D. I. 17) This court entered a scheduling order on October 26, 2010 setting a deadline
of January 23, 2011 for filing amended pleadings. (D.I. 28 at ,-r 3) Defendants filed a

motion for judgment on the pleadings pursuant to Fed. R. Civ. P. 12(c) on February 4,
2011. (0.1. 31) An opinion was entered on September 30, 2011 ("Memorandum
Opinion") along with an order granting defendants' motion for judgment on the
pleadings on all counts. (0.1. 73, 74) The court ordered judgment to be entered in
favor of defendants and against plaintiff. (0.1. 75) Presently before the court is
plaintiff's motion for reconsideration, to alter or amend the judgment, and a motion for
leave to file an amended complaint under Fed. R. Civ. P. 59(e) and 15(a), respectively.
(0.1. 77)

2. Background. The court incorporates by reference the background provided
in its prior opinion. (0.1. 73) In short, plaintiff and Scimed entered into an assignment
agreement ("the Agreement") in which plaintiff assigned Scimed several of his patents
for cardiovascular stents. (0.1. 1 at~ 7) Plaintiff also entered into a part-time
employment agreement with BSC with the goal of developing and commercializing the
stent technology. (0.1. 47, ex. A) The Agreement provided for a $50 million payment at
closing and an additional payment of up to $110 million dependent on various
contingencies. (0.1. 1 at~ 7). One such contingency is Scimed's recovery from third
party infringers, whereupon plaintiff receives a percentage of the recovery. (/d.

at~

8)

Another contingency is the sale of stents covered by plaintiff's patents equaling or
exceeding $2.5 billion, whereupon plaintiff receives a fixed monetary payment. (/d.
9)
3. Plaintiff sought damages for alleged violations of both aforementioned
contingencies, citing an agreement between defendants and Cordis Corporation

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("Cordis") and Johnson & Johnson ("J&J") settling two separate lawsuits. (/d.

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10-

14) The settlement involved plaintiff's patents, but did not result in any payment to
plaintiff. (/d.) As part of this settlement, defendants paid $1.75 billion and granted
irrevocable licenses to eleven Jang stent patents. (!d.

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13; 0.1. 47, ex. Cat§ 6.1)

In return, defendants received non-monetary compensation including irrevocable
licenses to various patents. 1 (0.1. 1 at~ 14; 0.1. 47, ex. Cat§ 6.2) In response to
plaintiff's complaint, defendants moved for judgment on the pleadings. (0.1. 31) The
court granted defendants' motion, determining that plaintiff failed to satisfy the pleading
standards as set forth by Fed. R. Civ. P. 12(c) and 12(b)(6). (0.1. 73 at 14)
4. The proposed amended complaint, which is presently under consideration,
sets forth more fully plaintiff's original claims alleging breach of contract and breach of
the implied covenant of good faith and fair dealing. (0.1. 77, ex. A at

,m 41-45, 50-55)

Plaintiff also seeks to add a new claim asserting breach of an anti-assignment provision
of the Agreement, hereafter referred to as§ 9.4. (/d.

at~

46-49)

5. Motion for leave to file an amended complaint. "After amending once or
after an answer has been filed, the plaintiff may amend only with leave of the court or
the written consent of the opposing party, but 'leave shall be freely given when justice
so requires."' Shane v. Fauver, 213 F.3d 113, 115 (3d Cir. 2000) (quoting Fed. R. Civ.
P. 15(a)). The Third Circuit has adopted a liberal approach to the amendment of
pleadings to ensure that "a particular claim will be decided on the merits rather than on

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United States Patent Nos: 5,895,406; 5,938,682; 5,980,553; 6,162,243 (the
Gray patents); and 4,733,665; 4,739,762; 4,776,337; 5,1 02,417; 5, 195,984; 5,902,332
(the Palmaz patents). (0.1. 47, ex. C. at§ 1.5)

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technicalities." Dole v. Arco Chemical Co., 921 F.2d 484, 486-87 (3d Cir. 1990)
(citations omitted). Although granting leave to amend is within the discretion of the
court, it should only be granted absent a showing of "undue delay, bad faith or dilatory
motive on the part of the movant, repeated failure to cure deficiencies by amendments
previously allowed, undue prejudice to the opposing party by virtue of the allowance of
the amendment, futility of amendment, etc." Forman v. Davis, 371 U.S. 178, 182
(1962); see also Oran v. Stafford, 226 F.3d 275, 291 (3d Cir. 2000).
6. "Delay becomes 'undue,' and thereby creates grounds for the district court to
refuse leave, when it places an unwarranted burden on the court or when the plaintiff
has had previous opportunities to amend." Bjorgung v. Whitetail Resort, LP, 550 F.3d
263, 266 (3d Cir. 2008) (citing, inter alia, Cureton v. Nat'/ Collegiate Athletic Ass'n, 252
F.3d 267, 273 (3d Cir. 2001)). Undue prejudice exists when an unfair burden has been
placed on the opposing party. See Cureton, 252 F.3d at 273 (citation ommitted). With
respect to prejudice, the court focuses on the hardship to the defendant if the
amendment were permitted, and in particular will consider "whether allowing an
amendment would result in additional discovery, costs, and preparation to defend
against new facts or new theories." /d. (citations omitted). If the proposed amendment
"is frivolous or advances a claim or defense that is legally insufficient on its face, the
court may deny leave to amend." Harrison Beverage Co. v. Dribeck Importers, Inc.,
133 F.R.D. 463, 468 (D.N.J. 1990).
7. Plaintiff's motion for leave to file an amended complaint was filed nine months
after the January 23, 2011 deadline to amend the pleadings and after judgment was

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entered in favor of defendants. (D.I. 77, 28, 75) The Third Circuit has stated that,
"[a]lthough Rule 15 vests the District Court with considerable discretion to permit
amendment 'freely ... when justice so requires,' Fed. R. Civ. P. 15(a), the liberality of
the rule is no longer applicable once judgment has been entered." Ahmed v.
Dragovich, 297 F.3d 201, 207-08 (3d Cir. 2002). Rather, Rule 59 "govern[s) the

opening of final judgments." /d. at 208. "To hold otherwise would enable the liberal
amendment policy of Rule 15(a) to be employed in a way that is contrary to the
philosophy favoring finality of judgments and the expeditious termination of litigation."
/d. (quoting 6 Charles Alan Wright, Arthur R. Miller, & Mary Kay Kane, Federal Practice
& Procedure§ 1489, at 694 (2d ed. 1990)). Therefore, the court's analysis of the

motion for reconsideration under Rule 59, below, dictates the outcome of the Rule 15(a)
motion. 2
8. Plaintiff neglects to recognize the post-judgment status of the case, arguing
instead that there is no undue delay because "[t)he case is still at the pleading stage,
and only minimal document discovery has been conducted to date." (D. I. 78 at 9) The
"question of undue delay requires [that the court] focus on the movant's reasons for not
amending sooner." Cureton v. Nat'/ Collegiate Athletic Ass'n, 252 F.3d 267, 273 (3d
Cir. 2001). When "a party fails to take advantage of previous opportunities to amend,
without adequate explanation, leave to amend is properly denied." Arthur v. Maersk,
Inc., 434 F.3d 196, 204 (3d Cir. 2006). Because plaintiff offers no explanation for his

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Defendants argue that Rule 16(b)(4), which governs modifications to the
scheduling order, provides the appropriate standard, but fail to identify authority in
which Rule 16(b)(4) controls Rule 15(a) post-judgment. (D. I. 82 at 4-5)

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belated amendment request, the court finds undue delay. See Asahi Glass Co. Ltd. v.
Guardian Industries Corp., 276 F.R.D. 417, 420 (D. Del. 2011) (finding undue delay
when the late motion to amend was "largely unexplained").
9. Even disregarding the fact that the amendment occurred post-judgment,
"certain prejudice to [the non-moving party] is inherent" when the motion to amend is
submitted after the deadline as set forth in the scheduling order, as is presently the
case. /d. at 420 (finding prejudice when the request to amend came six months after
the deadline to amend the pleadings and after the close of fact discovery). Altogether,
even considering the merits of the Rule 15(a) motion independently of the court's
analysis of the Rule 59 motion, plaintiff acted with undue delay, and granting the motion
would prejudice defendants. 3
10. Motion for reconsideration. Motions for reconsideration are the "functional
equivalent" of motions to alter or amend judgment under Fed. R. of Civ. P. 59( e). See
Jones v. Pittsburgh Nat'/ Corp., 889 F.2d 1350, 1352 (3d Cir. 1990) (citing Fed. Kemper
Ins. Co. v Rauscher, 807 F.2d 345, 348 (3d Cir. 1986)). The standard for obtaining
relief under Rule 59( e) is difficult to meet. The purpose of a motion for reconsideration
is to "correct manifest errors of law or fact or to present newly discovered evidence."
Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3d Cir. 1985). Accordingly, movant must
demonstrate one of the following in order to justify altering or amending the judgment:
(1) a change in the controlling law; (2) availability of new evidence not available when
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Essentially, plaintiff "seeks to take a second bite at the apple" by amending his
complaint at this late date when he could have done so in a timely manner. Murphy v.
Bancroft Construction Co., Civ. No. 02-453, 2004 WL 1326464, at *2 (D. Del. June 7,
2004).

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the judgment was granted; or (3) a need to correct a clear error of law or fact or to
prevent manifest injustice. See Max's Seafood Cafe ex-ref Lou-Ann, Inc. v. Quinteros,
176 F.3d 669, 677 (3d Cir. 1999). Motions for reargument or reconsideration may not
be used "as a means to argue new facts or issues that inexcusably were not presented
to the court in the matter previously decided." Brambles USA, Inc. v. Blocker, 735 F.
Supp. 1239, 1249 (D. Del. 1990).
11. Plaintiff requests reconsideration of the court's Memorandum Opinion
granting defendants' motion for judgment on the pleadings. (D.I. 77) Plaintiff does not
assert that there is a change in the controlling law or that there is new evidence that
was not available before the judgment was granted, so plaintiff must demonstrate a
need to correct a clear error of law or fact. See Max's Seafood Cafe ex-ref Lou Ann,
176 F.3d at 677.
12. The court dismissed plaintiff's first cause of action relating to the breach of
contract claims as "unactionable on the face of the Agreement." (D.I. 73 at 11) Plaintiff
now argues that: (1) the court failed to address the assertion, "set forth more fully in the
[amended complaint]," that defendants did recover monetary damages; and (2) the
court committed a legal error in interpreting the language of§ 7.3 of the contract as
strictly pertaining to monetary damages. (D.I. 78 at 4, 5-6) Both assertions essentially
ask for reconsideration of the court's conclusion that "the Agreement does not
contemplate payments to plaintiff based on the 'non-monetary value' of the Jang stent
patents." (D .I. 73 at 8)

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13. Because a motion for reconsideration is not properly grounded on a request
that a court rethink a decision already made, the court will not address for a second
time plaintiff's assertion that the defendants did receive monetary damages. See
Samuel v. Carroll, 505 F. Supp. 2d 256, 262 (D. Del. 2007) (denying the motion for
reconsideration when movant attempted to "relitigate issues that have already been
decided"). 4
14. Next, plaintiff asserts that the court failed to consider breach of§ 9.4 of the
Agreement, as alleged in the amended complaint. (D. I. 78 at 6-7) However, as the
court previously noted, arguments pertaining to§ 9.4 of the Agreement were not set
forth in the original complaint. (D. I. 73 at 7 n.6) Because motions for reconsideration
may not be used to argue new issues that were not presented in the matter previously
decided, the court will not consider arguments relating to breach of§ 9.4. See Tillman
v. Pepsi Bottling Group, Inc., Civ. No. 04-1314, 2008 WL 1987262, at *3 (D. Del. May
7, 2008) (the court "declines to reexamine its holding with respect to [movant's] prima
facie case" when presented with a new issue).
15. Finally, plaintiff contends that the court's dismissal of his third cause of
action for breach of the implied covenant of good faith and fair dealing was in error.
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With respect to the assertion of legal error, plaintiff cites case law in support of
his position that the term "damages" is ambiguous and should be expanded to include
both monetary and non-monetary damages. (D. I. 78 at 5) However, the newly cited
authority does not change the fact that the court already extensively considered this
argument in its Memorandum Opinion and concluded that "the language in the
Agreement is not ambiguous, as§ 7.39(c) describes the apportionment of monetary
'balance(s)."' (D.I. 73 at 9) The fact that "the court did not weigh the facts of record as
[movant] would have wanted" is "insufficient to meet the motion for reconsideration
standard." lntermec Technologies Corp. v. Palm Inc., 830 F. Supp. 2d 1, *8 (D. Del.
2011 ).

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(D. I. 78 at 7-9) However, as with other arguments posed by plaintiff, this contention is
merely a restatement of an argument already fully considered in the Memorandum
Opinion which led the court to conclude that "[t]here can be no breach of covenant of
good faith and fair dealing ... in the absence of a breach of contract." (D .I. 73 at 11)
Even plaintiff's assertion that "[a] party may breach the covenant of good faith and fair
dealing implicit in every contract without breaching any express term of that contract" is
undermined by the fact that "the covenant may not be invoked to create rights and
duties not contemplated by the provisions of the contract[.]" Speakman v. Allmerica

Financial Life Ins., 367 F. Supp. 2d 122, 132 (D. Mass. 2005). The court previously
concluded that there was no contractual duty to apportion non-monetary balances
between the parties and, therefore, there was no breach of the contract or breach of the
implied covenant of good faith and fair dealing. (D.I. 73 at 9) The court finds no
occasion to reconsider this determination at this juncture.
16. Conclusion. For the aforementioned reasons, the court denies plaintiff's
motion for leave to file an amended complaint and plaintiff's motion for reconsideration.

~T~

United States District Judge

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