MICHAEL LESH, M.D. and ERIK VAN DER BURG, acting jointly as the Shareholder Representatives for former shareholders of Appriva Medical, Inc., Plaintiffs,
EV3, INC., Defendant.
Date Submitted: June 20, 2013.
On Defendant's Renewed Motion for Judgment as a Matter of Law.
On Defendant's Motion for New Trial or Remittitur.
Jon E. Abramczyk, Esq., Matthew R. Clark, Esq., Morris of Nichols, Arsht & Tunnell, LLP, Wilmington, Delaware and Jay Lefkowitz, Esq., Eric F. Leon, Esq., John Del Monaco, Esq., of Kirkland & Ellis, LLP, New York, New York and Robert A. Goodin, Esq., Francine T. Radford, of Goodin, MacBride, Squeri, Day & Lamprey, LLP, San Francisco, California. Attorneys for Plaintiffs.
Matt Neiderman, Esq., Benjamin A. Smyth, Esq. of Duane Morris, LLP, Wilmington, Delaware and Jeffrey J. Bouslog, Esq., Bret A. Puls, Esq., Dennis E. Hansen, Esq., Cynthia S. Wingert, Esq. of Oppenheimer, Wolff & Donnelly, LLP, Minneapolis, Minnesota and Matthew A. Taylor, Esq., James L. Beausoleil, Jr., Esq., Seth A. Goldberg, Esq. of Duane Morris, LLP, Philadelphia, Pennsylvania. Attorneys for Defendant ev3, Inc.
Before the Court is Defendant ev3, Inc.'s ("ev3") renewed motion for judgment as a matter of law and motion for new trial, or remittitur. The Court has reviewed the parties' submissions and, for the following reasons, ev3's motions are DENIED.
Plaintiffs, former Appriva, Inc. ("Appriva") shareholders ("Plaintiffs"), and ev3 entered into a merger agreement ("Merger Agreement") in which ev3 acquired a medical device from Appriva and agreed to make certain payments to the Appriva shareholders ("Milestone payments") which were dependent on certain regulatory events ("Milestones"). The Merger Agreement required ev3 to fund and pursue the Milestones "notwithstanding any provision to the contrary […] at its sole discretion, to be exercised in good faith." The Merger Agreement also incorporated a March 15, 2002 Letter of Intent ("Letter of Intent"), which stated that ev3 would "commit to funding based on the projections prepared by its management to ensure that there is sufficient capital to achieve the performance milestones […]" When the Milestones were not achieved by ev3, Plaintiffs filed suit for breach of contract, breach of the implied covenant of good faith and fair dealing, fraudulent inducement, and violations of the California Corporations Code.
Prior to the trial, ev3 submitted various motions in limine, including motions to exclude evidence relating to the funding provision of the Letter of Intent and pre-merger communications contradicting the plain language of the Merger Agreement. The Court ruled that Section 9.6 of the Merger Agreement, the provision concerning ev3's obligations to fund and pursue the Milestones, was unambiguous and that parol evidence would be inadmissible to vary its terms. The Court also permitted evidence and argument relating to the funding provision of the March 15, 2002 Letter of Intent ("Letter of Intent").
After a nine-day trial, the jury rendered a verdict finding that ev3 breached the Merger Agreement and that Plaintiffs were entitled to $175 million in damages, which represented the sum of the four Milestone payments. The jury found that ev3 did not commit fraud. After the close of the evidence, ev3 submitted a motion for judgment as a matter of law. The Court took the matter under advisement pursuant to Rule 50 and submitted the case to the jury without ruling on the motion. ev3 then submitted a renewed motion for judgment as a matter of law and a motion for new trial or, in the alternative, remittitur.
I. DEFENDANT'S RENEWED MOTION FOR JUDGMENT AS A MATTER ...