Boston Sci. Corp. v. BioCardia, Inc.

Opinion

ORDER GRANTING MOTIONS TO DISMISS

In April 2019, BioCardia sent a demand letter to Boston Scientific Corporation and Surbhi Sarna regarding an intellectual property dispute. BioCardia was under the impression that Boston Scientific had acquired certain patents when it purchased a company called nVision, which Sarna founded. BioCardia's allegations, in a nutshell, were: (i) when Sarna previously worked for BioCardia, she was privy to certain trade secrets; (ii) during and after her time with the company, she secretly obtained patents for inventions using those trade secrets; (iii) she later founded nVision to develop those inventions; and (iv) Boston Scientific was now liable to BioCardia since it acquired nVision.

In September 2019, Boston Scientific and Fortis Advisors, a representative for nVision's former securityholders, filed a declaratory relief action in the Northern District of California against BioCardia, challenging BioCardia's allegations. BioCardia responded with counterclaims against Boston Scientific and Fortis and also named Sarna. The counterclaims were for correction of inventorship, breach of contract, and misappropriation of trade secrets under California [*5]  law.

It eventually became apparent that nVision was the actual holder of the intellectual property that BioCardia thought Boston Scientific held. But instead of filing a motion under Rule 16 seeking leave to add nVision, BioCardia filed a second lawsuit in the Northern District. That lawsuit was originally against nVision but later amended to add 19 of nVision's former shareholders. Similar to the counterclaims in the first case, in the second case BioCardia asserted claims for correction of inventorship and misappropriation of trade secrets. BioCardia then filed a motion to consolidate the second lawsuit with the first lawsuit. In that motion, BioCardia asserted that the relevant information "came to light after the Court's . . . [scheduling order] deadline to amend its counterclaims, [so] BioCardia filed a complaint against nVision . . . so it could be sure all parties had been sued and complete relief could be obtained." BioCardia's counsel implied during a hearing that he never sought to add these parties to the first lawsuit because he did not think the Court would find good cause to amend the scheduling order under Rule 16 and thus would deny such a motion. The Court ultimately denied the motion [*6]  to consolidate the cases, determining that BioCardia's second lawsuit was an impermissible effort to circumvent the scheduling order in the first lawsuit. The Court also noted that the second lawsuit raised serious claim-splitting concerns that could lead to its dismissal.

Then, in October 2020, BioCardia's counsel filed yet another lawsuit in the Northern District. The plaintiff in this third lawsuit was not BioCardia, but its wholly owned subsidiary, BioCardia Lifesciences. Apparently, all this time, BioCardia and its lawyers were mistaken about which entity had potential claims for correction of inventorship, breach of contract, and misappropriation of trade secrets. Sarna had been employed by BioCardia Lifesciences, not BioCardia. And the alleged trade secrets belonged to Biocardia Lifesciences, not BioCardia.

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