Steady State Imaging, LLC v. General Electric Company

Filing 536

MEMORANDUM OPINION AND ORDER granting in part and denying in part 483 Motion in Limine; granting in part and denying in part 491 Motion in Limine; granting in part and denying in part 499 Motion in Limine. (Written Opinion) Signed by Chief Judge John R. Tunheim on 2/23/2021. (HMA)

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UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
STEADY STATE IMAGING, LLC,
Plaintiff,

Civil No. 17-1048 (JRT/KMM)

v.
GENERAL ELECTRIC COMPANY,

ORDER ON MOTIONS IN LIMINE

Defendant.

Devan V. Padmanabhan, Paul J. Robbennolt, Britta S. Loftus, and Michelle
E. Dawson, PADMANABHAN & DAWSON PLLC, 45 South Seventh Street,
Suite 2315, Minneapolis, MN 55402, for plaintiff.
Marla Butler and Jonathan Nussbaum, THOMPSON HINE LLP, 3560 Lenox
Road Northeast, Suite 1600, Atlanta, GA 30326; Steven A. Block,
THOMPSON HINE LLP, 20 North Clark Street, Suite 800, Chicago, IL 60602;
Jamar T. King, THOMPSON HINE LLP, 10050 Innovation Drive, Suite 400,
Miamisburg, OH 45342; and Jeffrey R. Moore, THOMPSON HINE LLP, 3900
Key Center, 127 Public Square, Cleveland, OH 45342, for defendant.
In 2011, Steady State Imaging, LLC (“Steady State”) and General Electric Company
(“GE”) entered into a contract regarding SWIFT technology, a magnetic resonance
imaging technique developed by Steady State. Steady State Imaging, LLC v. Gen. Elec. Co.,
No. 17-1048, 2019 WL 1491934, at *1 (D. Minn. Apr. 4, 2019). Steady State brought this
action in April 2017, alleging two counts of breach of contract, breach of the implied
covenant of good faith and fair dealing, and promissory estoppel. Id. The Court dismissed

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Steady State’s breach of good faith and fair dealing claim in January 2018 and, in April
2019, granted summary judgment for GE on the first breach of contract claim, after
finding that the Asset Purchase Agreement (the “APA”) entered into by the parties did
not obligate GE to commercialize SWIFT technology. Id. at *1, 7.
There are, therefore, two remaining counts to be tried—Count III (breach of
contract) and Count IV (promissory estoppel)—which involve either alleged oral offers or
promises made by GE to Steady State to commercialize SWIFT independent of the APA.
Steady State, 2019 WL 1491934, at *7–9. The parties have brought Motions in Limine in
advance of trial to resolve a number of evidentiary disputes, which the Court will now
address.
DISCUSSION
I. STEADY STATE’S MOTIONS IN LIMINE
A. Exclude References to the Court’s Dismissal of Counts I and II (MIL #1)
Steady State seeks to preclude GE from introducing evidence concerning the
Court’s dismissal of Counts I and II of the Amended Complaint, arguing that such evidence
is irrelevant, likely to cause unfair prejudice, and likely to mislead the jury. The Court
agrees and, thus, will not admit the earlier rulings as evidence, nor will it instruct the jury
of the Court’s rulings with respect to Counts I and II. Accordingly, the Court will grant this
Motion.

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However, the Court recognizes that it is important for the jury to understand that
GE had no obligation to commercialize SWIFT technology under the APA, and will allow
an instruction to the jury to accomplish this. The parties are instructed to meet and confer
regarding such an instruction, which they will then propose for the Court’s consideration.
B. Exclude Evidence Inconsistent with the Court’s Finding that the Integration
Clause of the APA Did Not Preclude the Parties from Orally Modifying the APA
(MIL #2)
Steady State argues that GE should not be permitted to make arguments or
introduce evidence contradicting the Court’s earlier finding that, under Minnesota law, a
written contract can be orally modified even if the contract prohibits such modifications.
Steady State asserts that any such evidence is irrelevant and would be misleading.
GE argues that it is not seeking to relitigate whether post-APA promises are legally
invalid; instead, it seeks to introduce evidence of the parties’ beliefs concerning the
validity of any post-APA promises or oral offers. GE asserts that this is necessary to
demonstrate that GE could not have assented to any alleged oral contract, and that
Steady State could not have reasonably relied on any promises.
The Court finds that the state of mind of witnesses who were aware of the
Integration Clause is relevant, both in terms of GE’s intent to be bound and the
reasonableness of Steady State’s reliance. Furthermore, Steady State can mount an
effective attack on GE’s arguments at trial by questioning the credibility of witnesses’
beliefs, or by demonstrating that Steady State relied on GE’s promises or oral offers to
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commercialize SWIFT irrespective of any belief related to the Integration Clause.
Accordingly, the Court will deny this Motion. However, the Court notes that if GE strays
too far towards suggesting that the Integration Clause, itself, bars Steady State’s claims,
then the Court will consider instructing the jury of its earlier finding.
C. Order that Certain Emails and Documents Do Not Constitute Hearsay (MIL #3)
Steady State asks the Court (1) to rule that all documents produced from the files
of the parties qualify for the business records hearsay exception and (2) that all
documents and emails authored by GE agents and employees constitute party
admissions, and (3) to order GE to sort its remaining objections by category (relevance,
foundation, authentication, etc.).
The Court will deny this Motion with respect to ordering GE to categorize its
objections; however, the Court instructs GE to reexamine whether some of its nearuniversal objections are no longer merited following the parties’ subsequent stipulations
and the Court’s findings here.
Additionally, the Court prefers to deal with hearsay objections as they arise during
trial. Accordingly, the Court will defer ruling on which documents and emails qualify as
non-hearsay until the appropriate time.
II. GE’S MOTIONS IN LIMINE
A. Limit Steady State to Presenting Only Facts Disclosed in Its Interrogatory
Responses (MIL #1)

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Steady State has identified three promises to support its oral contract and
promissory estoppel claims, and three additional promises to support its promissory
estoppel claim. GE asks the Court to limit Steady State’s arguments at trial to these
specific promises and to any facts expressly set forth in its interrogatory responses. The
Court will deny this Motion, as the Court can address and rule on objections as they are
offered at trial.
B. Limit Steady State to Presenting Evidence Only of the Two Forms of
Consideration Disclosed in Discovery (MIL #2)
Though the Motion’s title suggests limiting Steady State to forms of consideration
disclosed during discovery, GE actually asks that Steady State be limited to arguing or
presenting evidence of forms of consideration that Steady State explicitly identified in its
interrogatory responses. The Court will deny this Motion, as Rule of Civil Procedure 26(e)
allows for the introduction of facts already made known to the party through other forms
of discovery, and the Court can rule on objections as they come up at trial.
C. Bar Steady State from Presenting Evidence of Reliance Damages (MIL #3)
Steady State avers that it intends to seek only expectation damages. Accordingly,
the Court will deny this Motion as moot.
D. Preclude Steady State from Arguing or Presenting Evidence that GE Acquired
SWIFT to Deny It to Competitors (MIL #4)
GE argues that its motivations for entering into the APA, which may have included
keeping SWIFT out of its competitors’ hands, are irrelevant with respect the post-APA
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promises or oral contracts at issue here. As such, GE maintains that Steady State only
seeks to introduce such evidence to paint GE in a bad light with the jury.
Steady State asserts that it does not intend to cast GE in a bad light. Rather, Steady
State maintains that such evidence helps to demonstrate a form of contractual
consideration, and is relevant regarding why GE might have promised or agreed to
commercialize SWIFT, why GE might have been comfortable developing an alternative
technology in lieu of SWIFT, and how GE might have realized value from SWIFT.
The Court agrees that evidence indicating that GE was motivated to keep SWIFT
out of its competitors’ hand is relevant. Further, the probative value of any such evidence
is not substantially outweighed by the danger of causing unfair prejudice, especially as
any resulting prejudice can be cured by direct or cross examination or via objection at
trial. Accordingly, the Court will deny this Motion. However, the Court does caution
Steady State that the focus of any inquiry into GE’s motivations should be directed
towards the post-APA promises or agreements and not towards why GE may have
entered into the APA.
E. Preclude Steady State from Arguing or Presenting Evidence Regarding the Size,
Wealth, or Revenue of GE (MIL #5)
GE argues that, under Minnesota law, evidence of a defendant’s financial condition
is inadmissible. To be sure, Minnesota law disallows consideration of a defendant’s
financial condition when deciding compensatory damages. See Minn. Stat. § 549.20,
subd. 4.
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GE also notes that courts generally instruct juries that parties are to be considered
of equal standing and equal worth, so allowing Steady State to reference GE’s much larger
size and wealth would unfairly prejudice it. The Court agrees that such a jury instruction
would be appropriate and finds that this instruction will cure much of the prejudice, if
any, that GE may suffer from evidence concerning its size, wealth, or revenue.
The Court further finds that size and wealth evidence is relevant with respect to
establishing whether GE had the financial resources to commercialize SWIFT, which is
what Steady State argues it intends to show. Accordingly, the Court will deny this Motion.
However, the Court cautions Steady State against spending too much time on GE’s size,
wealth or revenue, as the jury does not need to be told again and again, and against
referencing GE’s financial resources except with respect to its ability to commercialize
SWIFT.
F. Preclude Steady State from Presenting Evidence Regarding Its Siemens
“Opportunity Cost” Damages Theory (MIL #6)
GE asserts that Steady State should not be allowed to claim lost opportunity costs
based upon a contract with Siemens that Steady State might have entered into had it not
executed the APA with GE instead, as the Court already found that the Siemens contract,
like the APA, did not require Siemens to commercialize SWIFT, so any claim to lost
opportunity damages is speculative. The Court agrees and, accordingly, will grant this
Motion to the extent that GE asks that Steady State be barred from presenting the
speculative royalty payments from Siemens to establish or corroborate damages flowing
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from the alleged post-APA offers or promises. However, the Court notes that testimony
regarding Siemens’ offer to acquire SWIFT is not necessarily barred altogether, as it may
be relevant to rebut a claim that SWIFT lacked value. Objections related to eliciting
testimony for this purpose can be raised at trial.
G. Preclude Steady State from Arguing or Presenting Evidence that GE Did Not
Create an ATD Program under the APA or that GE Breached the APA (MIL # 7)
GE argues that Steady State should be precluded from relitigating whether GE
breached the APA, including any obligation to create an ATD Program, as the Court
already found that Steady State’s APA breach of contract claim failed as a matter of law.
Steady State maintains that the Court did not reach the issue of whether GE breached the
contract by failing to create a SWIFT ATD Program, for the Court dismissed the claim on
the grounds that damages were too speculative. Steady State also asserts that, if it cannot
present evidence that GE failed to create an ATD program, then its evidence of
consideration—that it would refrain from taking any action to enforce the APA—would
appear nonsensical to the jury. Thus, Steady State argues that it should be able to argue
that GE was in breach and knew that it was in breach.
Steady State is correct that the Court did not reach the question of whether GE
was in breach, but necessarily, then, neither did the Court find that GE was in breach, as
Steady State asserts here. Instead, the Court found that, “with respect to GE’s obligation
to create and/or complete the SWIFT ATD Program, the APA is ambiguous.” Steady State,
2019 WL 1491934, at *5. Because “construction of an ambiguous contract becomes a
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fact question for the jury,” Amer. S.S. Co. v. Hallet Dock Co., 862 F. Supp. 2d 919, 944 (D.
Minn. 2012), to resolve any question concerning whether GE had, in fact, breached the
APA by failing to create an ATD Program, the jury would have to take a significant detour
into the world of the APA. As the APA is not at issue here, any such detour would offer
little probative value and be of little consequence in determining the action.
Further, assuming any probative value could be realized by detouring away from
the alleged post-APA offers and promises actually at issue, it would be substantially
outweighed by the danger of wasting time, confusing the issues, and misleading the jury.
Accordingly, the Court will grant this Motion, while noting that if Steady State can show
during trial that such evidence has become relevant for the purpose of rebutting an
assertion that it did not forego legal action as a form of consideration based upon the
parties’ belief that a breach had occurred, then the Court will reconsider.
H. Preclude Steady State from Presenting Evidence on Prejudgment Interest (MIL
#8)
Steady State avers that it does not intend to argue or present such evidence to the
jury. Accordingly, the Court will deny this Motion as moot.
I. Preclude Steady State from Presenting Evidence that GE Did Not Produce
Sufficient Damages Data (MIL #9)
Steady State avers that it does not intend to present any testimony to the jury with
respect to this issue. Accordingly, the Court will grant this Motion as moot.

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J. Preclude Dr. Garwood from Offering Irrelevant Out-Of-Court Statements from
Third Parties (MIL # 10)
An expert witness for Steady State, Dr. Michael Garwood, invented SWIFT and cofounded Steady State, and he is expected to testify to SWIFT’s advantages over other
techniques, as well as the RUFIS technology that GE adopted instead of SWIFT, based
upon statements made by third-party caregivers indicating that they wished SWIFT was
available in the market. GE contends that the statements constitute hearsay, as they are
out-of-court statements made for the truth of the matter asserted. Further, while Rule
of Evidence 703 allows an expert opinion to be based on inadmissible facts and data, GE
maintains that such facts and data must be of the kind reasonably relied upon by experts
in the field, which these statements are not.
The Court agrees on both accounts and, thus, finds that the statements are
inadmissible hearsay. Accordingly, the Court will grant this Motion, while noting that if
Steady State can show during trial that such evidence has become relevant for rebutting
an assertion that demand for SWIFT did not exist in the market after GE released its RUFIS
technology, the Court will reconsider the matter.
K. Bar Steady State from Presenting Evidence of Damages Based on Early ForwardLooking Projections of Sales of SWIFT by GE (MIL # 12) 1

As disclosed at the motion hearing, GE has withdrawn it eleventh Motion in Limine, which
accounts for the skip in numbering.

1

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GE argues that Steady State should be precluded from introducing exhibits and
deposition designations concerning GE’s early projections of SWIFT sales because the
projections were not used by either party to calculate damages. GE acknowledges that
projections made after GE’s acquisition of SWIFT were included in the report of Don
Gorowsky, Steady State’s damages expert, for background information; however, GE
asserts that these projections formed no part of Gorwsky’s methodology or calculation of
damages.
Steady State contends that, while Gorowsky did not use GE’s projections to
calculate damages, he did cite to GE’s 2011 projections to highlight the reasonableness of
his own calculations. Additionally, irrespective of the damages question, Steady State
argues that the projections are important evidence to provide relevant background
information with respect to the parties’ negotiations, as GE provided them to Steady
State, and Steady State then considered them when deciding to enter into a contract with
GE.
The Court will deny the Motion, as the sales projections are relevant for the
purpose of rebutting any challenge by GE to the reasonableness of Steady State’s
calculation of damages, which is also why they were cited in Gorowsky’s report. However,
the sales projections cannot be used for calculating damages, and Steady State is
cautioned that the projections’ relevance wanes considerably if they are only of

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consequence to the parties’ APA negotiations, but of little consequence with respect to
post-APA negotiations or promises.

ORDER
Based on the foregoing, and all the files, records, and proceedings herein, IT IS
HEREBY ORDERED that:
1. Plaintiff’s Omnibus Motion in Limine [Docket No. 499] is DENIED in part and
GRANTED in part as follows:
a. The Court GRANTS Motion in Limine #1. The parties are to meet and confer,
then propose an instruction to inform the jury that GE had no obligation to
commercialize SWIFT technology under the APA.
b. The Court DENIES Motion in Limine #2.
c. The Court DENIES Motion in Limine #3 as to ordering GE to categorize its
objections and DEFERS ruling on which documents and emails qualify as
non-hearsay until the appropriate time arises at trial.
2. Defendant’s Omnibus Motion in Limine [Docket Nos. 483 and 491] is DENIED in
part and GRANTED in part as follows:
a. The Court DENIES Motion in Limine #1.
b. The Court DENIES Motion in Limine #2.
c. The Court DENIES as moot Motion in Limine #3.
d. The Court DENIES Motion in Limine #4, while noting that focus should only
be centered on motivations related to post-APA offers and promises.
e. The Court DENIES Motion in Limine #5, while noting that Steady State
should not spend more time than necessary to argue that GE had sufficient

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financial resources to commercialize SWIFT based upon its size, wealth, and
revenue.
f. The Court GRANTS Motion in Limine #6 to the extent that this evidence is
offered to calculate or corroborate damages.
g. The Court GRANTS Motion in Limine #7. However, if Steady State can show
that the evidence has become relevant at trial to rebut an assertion that it
did not forego litigation as a form of consideration, the Court will
reconsider.
h. The Court DENIES as moot Motion in Limine #8.
i. The Court DENIES as moot Motion in Limine #9.
j. The Court GRANTS Motion in Limine #10. However, if Steady State can
show that the evidence has become relevant at trial to rebut an assertion
that there was no demand for SWIFT, the Court will reconsider.
k. The Court DENIES Motion in Limine #12, but this evidence cannot be used
to calculate damages.

DATED: February 23, 2021
at Minneapolis, Minnesota.

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JOHN R. TUNHEIM
Chief Judge
United States District Court

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