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Ricerca Biosciences, LLC v. Nordion Inc.

Superior Court of Delaware, New Castle

January 23, 2015

RICERCA BIOSCIENCES, LLC, a Delaware limited liability company, Plaintiff/Counterclaim Defendant,
v.
NORDION INC., fka MDS Inc., a Canadian Corporation, and NORDION (US) INC., fka MDS PHARMA SERVICES (US) INC., a Delaware corporation Defendants/Counterclaim Plaintiffs.

Submitted: November 20, 2014

On Plaintiff's Motion for Summary Judgment DENIED.

On Defendants' Motion for Summary Judgment GRANTED.

Michael J. Barrie, Esquire, Stephen M. Ferguson, Esquire (Argued), David W. Mellot, Esquire, Benesch Friedlander Coplan & Aronoff LLP, Attorneys for Plaintiff/Counterclaim Defendant

Patricia L. Enerio, Esquire, Melissa N. Donimirski, Esquire (Argued), Proctor Heyman LLP, Attorneys for Defendants/Counterclaim Plaintiffs

OPINION

Honorable Mary M. Johnston, Judge

PROCEDURAL CONTEXT

Plaintiff/Counterclaim Defendant Ricerca Biosciences, LLC ("Ricerca") is a Delaware limited liability company with its principal place of business in Concord, Ohio. Ricerca is a contract research organization that is engaged in the business of providing pre-clinical discovery support and research and development services to pharmaceutical and biotech companies for drug development.

Defendant/Counterclaim Plaintiff Nordion Inc. ("Nordion") is a Canadian corporation with its principal place of business in Ottawa, Canada.[1] Nordion is a global health science company that manufactures products to be used for the prevention, diagnosis, and treatment of disease.

Ricerca instituted this action on October 23, 2013. Ricerca alleges that Nordion breached the parties' Stock Asset Purchase Agreement ("SAPA") by failing and refusing to defend and indemnify Ricerca during litigation with BioAxone Biosciences, Inc. ("BioAxone"). Ricerca seeks to recover $350, 000 in damages for its costs and expenses in defending and settling the BioAxone lawsuit.

Nordion filed a counterclaim, alleging that Ricerca breached the SAPA by failing and refusing to defend and indemnify Nordion for the same BioAxone litigation. Nordion seeks to recover $488, 951.93 in damages for its costs and expenses in defending and settling the BioAxone lawsuit.

On September 26, 2014, Ricerca and Nordion filed cross Motions for Summary Judgment. Oral argument was heard on November 20, 2014.

UNDISPUTED FACTS

In 2000, Nordion launched a full-service contract research organization comprised of drug discovery and development companies. The organization was divided into five business groups: (1) Discovery and Pre-Clinical; (2) Early Clinical Research; (3) Bioanalytical; (4) Clinical Research; and (5) Central Lab. The focus of this litigation is the Discovery and Pre-Clinical business group.

In 2003, the Discovery and Pre-Clinical business group opened a new biopharmaceutical facility in Bothell, Washington. Simultaneously, the Discovery and Pre-Clinical group established a Biopharmaceuticals Unit to be operated out of the Bothell, Washington facility. The Biopharmaceuticals Unit manufactured, among other things, bacterial cell banks.

In March 2003, BioAxone retained Nordion to manufacture a Bacterial Master Cell Bank to assist BioAxone in the production of a new drug. The cell bank subsequently was manufactured by the Biopharmaceuticals Unit of the Discovery and Pre-Clinical group at the Bothell, Washington facility.

In 2006, Nordion closed the Biopharmaceuticals Unit. The other units of the Discovery and Pre-Clinical group continued to work out ...


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