P RE CE DE NT I AL

UN I TED STATES CO UR T OF A PP EALS F O R T H E T H IR D C IR C U IT

_____________ N o. 09- 3790

_____________ EUROF I NS P HARM A US HOLDI NGS; VI RALL I ANCE IN C ., A p p e llan ts

v.

BI O A LLI A N CE PH A RM A SA ; V I RA LLI A N CE SA S;

GI LL ES AVENARD

______________ APP EAL F ROM THE UNI TE D ST ATE S DI S TRI CT

CO UR T F OR THE DI S TRI CT OF DEL AW ARE ( D

. C

. C i v. A ct i on N o. 08- 613) D i s tr i ctJ udge: H onor abl e G r egoryM

. Sl eet

______________ A r gued: J ul y13, 2010

______________ B e f o re : R E N D E L L , J O R D A N , a n d G R E E N A W A Y , J R .,

C i r cui tJ udges2 ( O pi ni on Fi l ed: O ct ober12, 2010)

______________ D ani el P. G ol dber g ( ar gued) D or i tU ngar K r i s t i na R

. J untunen Kas o wi t z , Be n s o n , To rr e s , & Fr i e d ma n , LLP N ew Y or k, N ew Y or k 10019 C o u n se l fo r Ap

p e lla n ts

J oel Fr i edl ander( ar gued) Sean M

. B r ennec ke B ouchar d M ar gul es & Fr i edl ander 222 D el aw ar e A venue, Sui t e 1400 W i l m i ngt on, D el aw ar e 19801 C ouns el f orAppel l ees

______________ OP I NI ON

______________

G R E E N A W A Y , J R

. , C i r cui tJ udge A ppel l ant s E ur ofi ns Phar m a U S H ol di ngs and V i r al l i ance I nc. appea l the di s m i s s al of thei rcompl ai ntbythe U ni t ed St at es D is trict C o u rt f

o r th e D istric t o f

D e law a re , w h ich h e ld th a t it lack ed per s onal j ur i s di ct i on overthe appe l l ees , B i oA l l i ance3 P h a rm a S A , V i ral l i ance S A S , and G i l l es A ven ard, and al so di s m i s s ed the act i on under the doctr i ne of f or um non conve ni ens
. F o r th e re aso n s tha t fo ll o w , w e w ill af firm the D istri ct C o u rt ’s
ru l i n g th a ti tl a c k s p e r s o n a l j u r i s d i c t i o n o v e rBi o Al l i a n c e P h a r ma S A a n d V ira lli a n c e S A S , v a c a te th e D istric t C o u rt’s o rd e r th a t it l acks per s onal j uri s di ct i on overG i l l es A venar d, and af fi r m the D istri ct C o u rt ’s dism issal of the a cti o n u n d er f

or um non conve ni ens
. I
. BA CKGROUND T h is d isp u te a rise s o u t o f th e a c q u isitio n b ya p p e ll a n ts E ur ofi ns Phar m a U S H ol di ngs ( “EP U SH ”) and V i r al l i ance I nc. (“ V I” ) (c o llec tiv e ly , “E u ro f in s G ro u p ” ) o f

in telle c tu a l p ro p e rty ( the “I P”) fr om B i oA l l iance Phar m a SA ( “B i oA l l i ance ”) and V i r al l iance SA S ( “V i r al l i ance ”) ( col l ect i vel y , “B i oA l l i ance G ro u p ” ). T h e IP in c lu d e s , a m o n g o th e r t h in g s , i n vitro phenotypi ng t echnol ogy , kno w n as as s ay s , thatas s i s ti n the devel opm ent and admi ni s tr at i on of drugs us ed t o tr eatH I V and H e p a tit is B b ytes tin g th e e f f e c tiv e n e ss o f

th o se d ru g s o n sp e c if

ic pat i e n t s ’ v i ru s e s
. I n 2 0 0 5 , Eu r o f i n s Gr o u p a n d Bi o Al l i a nce G ro u p e n ter e d in to a n a g re e m e n t ( th e “ T ra n sf e r A g re e m e n t”) to tr ans ferthe IP fr om B i oA l l i ance G r oup t o V I , forthe purpos e of
c o m m e rc ia liz in g th e IP in th e U n ite d S ta te s m a rk e t. T h e g ra v a m e n o f E u r o f in s G ro u p ’s c o m p lain t is th a t, d e s p i t e Bi o Al l i a n c e Gr o u p ’ s c o n tr a c tu a l p r o mi s e th a tn o c l a i ms w e r e pe nd i ng orthr e a t e ne d a ga i ns ti tr e ga r di ng the us e of the I P, B io A lli a n c e G ro u p k n e w a b o u t a p a ten t in f rin g e m e n t cla im threat ened againstthe IP b y A dv anced B i ologi cal L abo rat ori es, S. A

. ( “A B L ”) ; thatG i l l es A venar d— a d i r ect orof V I , the cofounderand chi ef ope r at i ng offi cerof B i oA ll i ance , and theV I w as former l yknow n as E ur ofi ns V i r al l i ance , I nc. , and 1 i s r efe r r ed t o as “EV I ” i n the Tra ns ferA gr eementand s ever al
c o u rt d o c u m e n ts . F o r th e p u rp o se o f c lar ity , all re f

e re n c e s to E V I a re c h a n g e d to V I i n th is o p in io n
. “Soci ét é anonym e” i s the Fr ench t erm us ed t o desi gnat e a 2
c o rp o ra tio n
. 4 f o rm e r p re sid e n t an d c h ie f e x e c u tiv e o f V ira lli a n c e

— f

a iled to i nform the other V I boar d m ember s of the thr eat ened c l ai m ; and th a t Bi o Al l i a n c e Gr o u p wr o n g l ya s s e r t s th a ti tc o n t i n u e s t o o wn the I P. A
. T he P art i es E P U S H is a h o lding co m p an yinco rpo rated in D elaw are w i t h i t s p r i n c i p a l p l a c e o f b u s i n e s s i n Des M o i n e s , I ow a. E ur ofi ns Sci ent i fi c, I nc. ( “Eurof i ns Sci ent i fi c”) , an af

fil ia t e of E PU SH , i s a D el aw are corpor at i on w i th i t s pr i nci pal pl ace of b u sin e ss in D e s M o in e s, Io w a
. (E P U S H a n d E u ro f in s S c ien tific
w i l l be col l ect i vel y r efe rr ed t o as “Eurof i ns
. ”) V I , a corpor at i on form ed underthe l aw s of D el aw ar e w it h it s pr i nci pal pl ace of b u s i n e s s i n D e s M o i n e s , I o w a , w a s c r e a t e d b y, a n d i s a w h o l l yo wne d s u b s i d i a r y o f

, Eu r o f i n s
. VI i s th e a c q u i r e r , v i a t he 1 T ra n s f e r A g re e m e n t, o f

th e IP a t th e h e a rt o f

th is litig a tio n
. B i oA l l i ance , a s oci ét é anonym e form ed under the l aw s of 2 F rance, w i th it s pri ncip a l p lac e of b usi ness i n F rance, i s a pharm ace ut i cal companyfocus ed on the tr eatm entof
o p p o rtun i st i c i nfec t i on s i n cancer and H IV

. V i ral l i ance w as a s i m pl i fi ed s ociété anonym e and w hol l y - ow ned s ubs i di aryof B i oA l l i ance , form ed underthe l aw s of Fr ance , w hi ch w asL api n al s o i ncorpor at ed V I i n D el aw ar e. 3
5 e n g a g e d in th e d e v e lo p m e n t a n d c o m m e rc ializ a tio n o f p ro d u c ts and s ervi ces t o as s es s vi r al and ca ncerdrug r es i s t ance
. A venar d, a di r ect orof V I and the co- founderand chi ef e xecut i ve off i cerof B i oA l l i ance , is a cit izen of Fr ance
. H e w as al s o the pr es i dent
a n d c h ie f e x e c u tiv e o f

f ic e r o f V ir a llia n c e
. B. The Tran s f

e r A gr e e m e nt T he Tra nsferA gr eementw as exec ut ed on O ct ober20, 2 0 0 5 , an d th e tr a n s a c tio n , p u rsu a n t to th e T ra n sf e r A g re e m e n t, cl os ed on D ece m ber15, 2005. T h e p arti es agr ee thatthe
m aj or i ty , i f not the ent i r ety , of the T r ans ferA g reem ent
n e g o tiatio n s too k p lac e in F ra n c e . O f th e in d iv id u a ls in v o lv e d in th e T ra n s f

e r A g re e m e n t n e g o tia tio n s , o n ly Jo n a t h a n L a p in , a N ew Y or k l aw y erw ho assi s t ed Eurof i ns G r oup, w as not dom i ci l ed i n E ur ope. 3
T he Tra ns ferA gr eementpr ov i ded thatE ur ofi ns form ed V I a s its w h o llyo w n e d su b sid iar ya n d th a t it(E u r o f in s) w o u ld fund V I w i th up t o $4 m i l l i on. I n excha nge, B i oA l l i ance G r oup w o u ld tra n sf

e r th e IP to V I f

o r te n d o llars a n d th e f

u tu re rig h t to p u rch ase stoc k o p ti o n s in V I (th e “ O p ti o n ”). ( A p p
. at 59 -60

. ) In
a d d iti o n , the T ra n sf

e r A g re e m e n t p ro v id e d th a t E u ro f in s w o u ld el ec t o n e p e r s o n n o mi n a t e d b y Bi o Al l i a n c e t o VI ’ s b o ar d of di r ect or s w hi l e B i oA l l i ance G r oup’ s O pti o n r emai ned
o u tst an d ing

. (A p p
. at 65

. )
T he Tra ns fer A gr eements t at es that , t o the bes tof B io A lli a n c e G ro u p ’s k n o w led g e , “th e IP is v a lid a n d e n f o rc e a b le and the curr ent us e byB i oA l l i ance G r oup ori t s l i cens ees ors ub-T he part i es agr eed that ther e w oul d be no forum s el ect i on 4 cl aus e, w hi ch r es ul t ed f rom thei ri nabi l i tyt o deci de on a
mu tu a l l ya c c e p t a b l e f

o ru m.
6 l i cens ees [] nei ther i nfr i nges on the r i ght s of anythi r d partynor c o n stitu tes a n u n a u th o riz e d u se ,” (A p p . at 6 3 ), an d th a t “th e re is no fac tw hi ch co ul d have a m at er i al adver s e ef fec ton ei therof [] V I orthe I P w hi ch has notpr evi ous l ybeen di s cl os ed i n w r i t i ng b y[ B io A llia n c e G ro u p ].” (A p p . a t 6 2 .)
T h e tran sfe r fro m B ioA ll ianc e G rou p to V I of the IP i ncl uded th e t r ans ferof B i oA l l i ance G r oup’ s r i ght , t i t l e, and in ter e st in a n d to a ll ag re e m e n ts, in c lu d in g lice n se s, re latin g to th e IP . (A p p . at 6 0 .) P r io r to th e T ra n sf e r A g re e m e n t, B i oA l l i ance G r oup had l i cens ed pat ent s that compri s e par t of the I P t o Speci al tyL abor at or i es , I nc. ( “Speci al tyL abs ”)

. T he lice n sin g a g re e m e n t b e tw e e n B io A lli a n c e G ro u p a n d S p e c ialty L a b s c o n t a i n e d a n o n - i n f r i n g e m e n tr e p r e s e n t a t i o n a n d w a rr a n ty, as w el l as an i ndemni fi cat i on obl i gat i on byB i oA l l i ance G r oup, i n favorof Speci al tyL abs

. E u rof ins G r oup as s um ed the in d e m n if ic a tio n o b lig a tio n u n d e r t h e T ra n s f e r A g re e m e n t. T h e T ran sfe r A g ree m en t “em b o d [ied ] th e e n ti re agr eement of the part i es w i th r es pect t o the s ubject m att er her eof” and pr ovided that the agr eement“s hal l be governed by and cons trued i n acc or dance w i th the l aw s of the St at e of D el aw are, w ithoutr egar d t o the conf l i ct s of l aw rul es of s uch S tat e.” (A pp. at67. ) I tdi d not , how ever , cont ai n a forum s el ect i on cl aus e. 4
C
. A B L ’s C l aim A ga i n st T h e IPE ur ofi ns G r oup di d not att ach as an exhi bi tt o the compl ai nt 5 th e A B L S e ttl e m e n t L ice n se b e c a u se th e c o m p lain t is su b jec t to
c o n f id e n tialityre str ic tio n s th a t re q u ire A B L ’s c o n se n t p rio r to di s cl os ur e. E ur ofi ns G r oup, how ever , has decl ar ed t hati ts eeks to su b m it a c o p yo f

th e A B L S e ttl e m e n t L ice n se d u rin g th is litig a tio n
. 7 O n oraboutJ ul y15 and A ugus t 23, 2006, A B L cont act ed Speci a l tyLa b s t o c l a i m t h a ti t s u s e o f c e r t a i n p h e n o typi ng t echn ology , l i censed t o i t by B i oA l l i ance G roup, i nfri n g e d tw o A B L pat ent s

— U

. S. Pat entN um ber s 6, 081, 786 and 6, 188, 988. O n Ja n u a ry2 7 , 2 0 0 7 , A B L su e d A m e riP a th , In c ., th e c o rp o ra te p a re n t o f S p e c ialty L a b s, f o r p a ten t in f

rin g e m e n t. V I ste p p e d in

5 to d e f e n d th e a c tio n , p u r s u a n t to its c o n tra c tu a l o b lig a tio n to i ndemni fySpeci al tyL abs

. A ft er s i x m onths of negot i at i ons , the p a r t i e s s e t t l e d th e l a ws u i t

. Un d e rth e s e t t l e me n t , AB L g r a n t e d VI
a non- excl us i ve l i cens e t o us e pat ent s 6, 081, 786 and 6, 188, 988, i n co nsi derat i on for a on e-t i m e pay m ent and roy al t i es. T h e c rux o f th e ins tant li ti g ati o n is E u rof ins G ro u p ’s al l egat i on t hati tl earned forthe fi r s tt i m e dur i ng the s ett l ement negot i at i ons thatA B L , i n ear l y2005, had i nform ed B i oA l l i ance Gr o u p th a t i t ( Bi o Al l i a n c e Gr o u p ) r e q u i r e d a l i c e n s e f r o m A BL,
w ith re sp e c t to th e p h e n o typ in g tec h n o lo g y . A B L h a d b e e n in
n e g o ti ati o n s w ith B ioA ll ianc e G rou p to p u rch ase V ir all ianc e’s asset s pri or t o E urofi ns G roup ’s invo l vem ent. A B L al so a l l e g e d l yi n f

o r me d Eur o f

i n s Gr o u p th a t , i n e a r l y2 0 0 5 , ABL engage d the s ervi ces of L a Soci et e B i ones t Par tner s ( “B i ones t ”) t o a d v i s e Bi o Al l i a n c e Gr o u p th a t i t r e q u i r e d a l i c e n s e f r o m ABL
w i th r es pectt o the phenotyp ing t echnol ogy
. E ur ofi ns G r oup al l eges th a tBi o n e s th a s a tl e a s to n e p i e c e o f wr i t t enAB L h a s a g r e e d t o p r o d u c e th e d o c u me n t t o E ur ofi ns 6 G r o u p , p r o v i d e d th a tBi o Al l i a n c e Gr o u p c o n s e n t s t o the d isc lo su re
. T h u s f

a r, B io A lli a n c e G ro u p h a s re f u se d to g iv e its
c o n se n t.
8 corr es pondence r efl ect i n g th e i n f r i n g e me n tc l ai m i tart i cul at ed on behal f of A B L t o B i oA l l i ance G r oup i n l at e 2004 orear l y2005. E ur ofi ns G r oup has , as y et , been una bl e t o pr ocur e thi s document due t o confi dent i al i tyobl i gat i ons as s ert ed byB i oA l l i ance G r oup. 6
A t a Jul y 22 , 20 08 , m eet i ng of the V I B oard of D i rect ors, A v e n a rd c o n f

irm e d th a t B io A lli a n c e k n e w a b o u t th e A B L c laim i n 2005, and thatB i oA l l i ance r efus ed t o cons entt o the r el eas e of the B i ones tcorr es pondence. T he mi nut es of thatm eet i ng pr ovi de:
T he fi fth or derof bus i nes s w as a di s cussio n of [ B io A lli a n c e ’s] re a so n s fo r ref u sin g to c o n se n t to th e d isc lo su re b y B io n e st of its d o ss ier re latin g to ef fo rt s o f B ion est (on b eh alf o f [ A B L ]) t o ac q u ir e th e V ira lli a n c e b u sin e ss f ro m [ B io A lli a n c e ] in 2005.

. . . M r
. A venar d ex p lai ned that [B i oA l l i ance ’ s ] cons entt o B i ones t ’ s di s cl osu re r eques tw as w i thhel d beca us e the B i ones tdos s i er c o n tain s c o n f

id e n tial a n d se n sitiv e stra teg ic in f o rm a tio n re latin g to [ B io A lli a n c e ’s] e f f o rts to
se ll th e V ira lli a n c e b u sin e ss a n d n o t re lev a n t to V I

. M r
. A ve na r d wenton t o s a yt hat, as aS a y a d a w a s a n A B L e x e c u tiv e in 2 0 0 5 , a t th e ti m e th a t it 7

w as negot i at i ng w i th B i oA l l i ance
. A venar d r efus ed t o s i gn the mi nut es forthatm eet i ng. 8 I ns t ead, he ci r cul at ed a r evi s ed ver s i on of the mi nut es , w hi ch pr ovi ded:

M r. A ven ard exp l ai ned tha t [B i oA l l i ance’s]
cons entt o B i ones t ’ s di s cl os ur e r eques tw as w i thhel d beca us e the B i ones t d os s i ercont ai ns con fi den t i al and sen sit i ve elem ents of b usi ness n e g o tiatio n [ s] r e latin g to [ B io A lli a n c e ’s] e f f o rt to
se ll th e V ira lli a n c e b u sin e ss a n d n o t re lev a n t to V I , w hi ch w as acknow l edged byJ onathan Lapi n. M r. A v en ard w en t o n to say that thing s w ere v ery cl ear w i th A B L pat ent s and thattheyhad nothi ng to d o w ith V ira lli a n c e sy ste m
. It a p p e a re d th a t, i n 2005, as a negot i at i ng t a c t i c, M r
. Say ada pr opos ed a l i cens e on a c om pl ement aryt echnol ogyi n or der t o enl ar ge t he busi nes s per s pect i ves , i n the uni que obj ect ive to j us t i fym aki ng a l ow eroffe rforthe
9 negot i at i ng t act i c i n 2005, M r
. Say ada al l eged 7 th a tth e Vi r a l l i a n c e b u s i n e s s i n fr i ng e d o n ABL pat ent s ( i n or dert o just i fym aki ng a l ow eroffe r forthe V i r al l i ance as s et s ) and that , at the t i m e, B i o A ll i ance had obt ai ned l egal opi ni ons ( w hi ch B i oA l l i ance had butw ou l d notm ake a vai l abl e) th a t th e re w a s n o in f

rin g e m e n t. (A p p . a t 1 3 1 .) 8V i ral l i ance a sset s. (A p p
. at 14 4

. )
T he com pl ai nts t at ed ei ghtcaus es of ac t i on: ( 1) fr audul ent 9 i nducement agai ns t B i oA l l i ance G r oup, s eeki ng r es ci s s i on; ( 2) fr audul enti nducementagai ns tB i oA l l i ance G r o up, s eeki ng damages ; ( 3) equi t abl e fr aud aga i ns tB i oA l l i ance G r ou p ; ( 4) br each o f cont r actagai ns tB i oA l l i ance G r oup; ( 5) br eac h of fi duci arydut i es agai ns tA venar d; ( 6) decl ar at oryj udgm ent againstB i oA l l i ance G r ou p; ( 7) i nfri ng em ent agai nst B i oA l l i ance G r oup; and ( 8) conver s i on agai ns tB i oA l l i ance G ro u p
. 10 I n connec t i on w i th the T r ans ferA gr eement , E ur ofi ns G r oup and B i oA l l i ance G r oup al s o ent er ed i nt o a Techni cal A s s i s t ance and R es ear ch A gree m ent( “TA R A ”)

. Pur s uantt o the TA R A , B i oA l l i ance G rou p w as g iven a li ce n se to the IP in o rde r t o d ev elop itfo r V I’s b e n e f it. V I w o u ld o w n a n yo f th e tec h n o lo g yth a t w a s d e v e lo p e d in
acc or dance w i th the TA R A and w as obl i gat ed t o r ei m bur s e B i oA l l i ance G roup f or r esear ch-r el at ed ex pen ses. T he inst an t li t i gati on al so conce r ns a d isput e overcert ai n t echnol ogydevel oped byB i oA l l i ance Gr o u p th a tVI c l a i ms o wn e r s h i p o v e r , p u r s u a n tt o th e T AR A.
D
. T he L i t i gat i on O n Sept ember23, 2008, E ur ofi ns G r oup s u e dBi o Al l i a n ce G r oup and A venar d i n the U ni t ed Stat es D i s tr i ctC our tforthe D i s tr i ct of D el aw ar e. O n O ct ober28, 2008, B i oA l l i ance G r oup 9 and A venar d m oved t o di s m i s s the compl ai nt

. O n J anuary29, 2 0 0 9 , B io A lli a n c e f

iled su it ag a in st E u ro f

in s G ro u p a n d A B L in11 the C om m er ci al C our ti n Par i s, F ran ce. O n M ar ch 11, 2009, B ioA ll ianc e G rou p an d A v en ard fil ed a m o ti o n to stayd isco v ery in th e D e law a re a c tio n p e n d in g th e o u tc o m e o f th e ir m o tio n to d is m is s
. O n J ul y6, 2009, the D i s tr i ct C our t hel d a t el econf er ence , pur s uant to Feder al R ul e of Ci vi l Pr ocedur e 16, t o di s cus s the
m ot i o n s t o d i s mi s s a n d s t a y d i s c o v e ry
. Dur i n g t he tel ec o n fe ren ce , the C o u rtissue d an o ral ord er stay ing d isco v ery i n the ca s e pendi ng i t s rul i ng on the mot i on t o di s m i s s : “i n a de f acto s o r to f

w a y, I a m g o i n g t o [ ] g r a n t [ ] th e m o t i o n f o r[ a ] s t a y, tho u g h n o t fo rm all y
. ” (A p p
. at 42 6

. ) O n Sept ember18, 2009, the D i s tr i ctC our tgr ant ed B i oA l l i ance G r oup’ s and A venar d’ s m ot i on t o di s m i s s
. E ur ofi ns Phar ma U. S. Hol d i n g s , I n c
. v
. Bi o a l l i a n c e Ph a r ma SA, No. 08- 6 1 3 , 2 0 0 9 W L 2 9 9 2 5 5 2 ( D

. D e l

. S e p t

. 1 8 , 2 0 0 9 )

. S p e c i f i c a l l y, the C our thel d thatthe cl ai m s agai ns tB i oA l l i ance G r oup and A venar d s houl d be di s m i s s ed forl ack of per s onal j ur isdic t i on, and thatth e ac ti on s houl d be di s m i s s ed underthe doctr i ne of f or um non conve ni ens
. I d. at *3. A ddi t i onal l y , the C our tdeni ed E ur ofi ns G r oup’ s r eques tt o t ake j ur i s di ct i onal di s covery
. I d. at *3 n. 4. On Fe b ru a r y1 7 , 2 0 1 0 , Eu r o f i n s Gr o u p f

i l e d th e i n s t a nt app eal chall eng i ng each o f t he D i stri ctC ou rt ’s ho l dings.

I I
. J UR I S DI CT I ON T he D i s tr i ctC our t ’ s j ur i s di ct ion w as pr emi s ed on 28 U

. S. C

. § 1332( a) ( 3)

. W e have jur i s di ct i on t o hearthi s appea l under28 U

. S. C

. § 1291.

III
. A N A L Y S IS12 Forthe r eas ons ad dr es s ed bel ow , w e w i l l aff i r m the D i s tr i ctC our t ’ s di s m i s s al of the cl ai m s agai ns tB i oA l l i ance G rou p fo r l ac k o f p erso n al j u ri sd ict ion an d the D istri ct C o u rt ’s d en i al of Eurof

i ns G r oup’ s m ot i on forj ur i s di ct i onal di s cove ry related to B ioA ll ianc e G rou p ; w e w il l v ac ate the D istri ct C o u rt ’s di s m i s s al of the cl ai m s agai ns tA venar d forlack of per s onal j ur i s di ct i on; and w e w i l l aff i r m the D i s tr i ctC our t ’ s di s m i s s al of the compl ai nton the gr ound of f or um non conve ni ens
. A
. Per s ona l Jur i s di c t i on O ve r Bi oAl l i anc e G r oup We r e v i e w de novo th e D istric t C o u rt’s d e c isio n th a t it l a c ks pe r s on a l j ur i s di c t i on. Tel c or di a Tec h I nc
. v. Tel ko m SA L td., 4 5 8 F

. 3 d 1 7 2 , 1 7 6 (3d C ir

. 2 0 0 6 ). U nder Fede r al R ul e of Ci vi l Pr ocedur e 4( e) , a fe der al di s tr i ctcourtm ayas s ertper s onal j ur i s di ct i on overa nonr es i dent of the s t at e i n w hi ch the courts i t s t o the ext entauthor i zed bythe l aw of thats t ate. W hethera di s tr i ctcourthas per s onal j u r i s d i c t i o n o v e ra n o n r e s i d e n t d e f e n d a n ti s a tw o - p a r ti n q u i ry. Fi r s t , t her e m u st be a s t atut orybas i s forexer ci s i ng j ur i s di ct i on overthe nonr es i dentdefe ndanti n acc or dance w i th the l aw of the forum s t at e. M et cal fe v. R enai s s ance M ar i ne, I nc. , 566 F. 3d 324, 330 ( 3d C i r
. 2009)

. Second, the nonr es i dentm us thave mi ni m um co n t a c t s wi th th e f

o ru m s t a t e s u f

f i c i e n tt o s a t i s f

yc o n s t i tu t i onal due pr oces s. I d. W her e the di s tr i ctcourtdoes nothol d an
e v id e n tiary he a rin g , the pla in tiff n e e d o n lye sta b lish a p rim a f a c ie
cas e of per s onal j ur i s di ct i on. I d. ( ci t i ng O ’ C onnorv. SandyL ane H o tel C o ., 4 9 6 F .3 d 3 1 2 , 3 1 6 (3 d C ir. 2 0 0 7 )). F u rth e r, “[ i]t is
w el l es t abl i s hed thati n deci di ng a mot i on t o di s m i s s for l ack of [p erso n al] j u ri sd ict ion , a c o u rt is req u ir ed to ac ce p t the p lai n ti ff ’s al l egat i ons as true, and i s t o const rue di s put ed fa ct s i n favorofS pecifi cal l y , the rel evan tt ext of § 3 10 4 p rovi des: 10
( c) A s t o a caus e of act i on br ought by anyper s on a risin g f ro m a n yo f

th e a c ts e n u m e r a ted in th is
s ect i on, a court m ay exer ci s e per s onal j ur i s di ct i on overanyn o n reside n t, o r a p erso n al rep rese n tat i ve, w h o in p e rso n o r th ro u g h a n a g e n t: ( 1) T r ans act s anybus i nes s orper form s any char act erof w or k ors ervi ce i n the St at e; ( 2) C o n tr act s t o s uppl ys ervi ces orthi ngs i n t hi s St at e; ( 3) C aus es t or t i ous i nj uryi n the St at e by
a n a c t o r o m is s io n o f

th is S ta te [ .]

D el

. C ode A nn. t i t

. 10, § 3104.
13 th e p la in tif

f.” Id . (c itin g T o y s “ R ” U s , In c . v . S te p T w o , S .A ., 3 1 8 F

. 3 d 4 4 6 , 4 5 7 (3d C ir

. 2 0 0 3 )).
I n pert i nentpart , the D el aw ar e l ong- arm s t atut e pr ovi des a st atut ory bas i s forthe exe r ci s e of pe r s onal j ur i s di ct i on overany n o n re sid e n t w h o tra n sa c ts b u sin e ss o r p e rf o rm s w o rk in D el aw ar e, contr act s t o s uppl y s ervi ces orthi ngs i n D el aw ar e, or causes t ort i ou s i njury i n D el aw are by an act or om i ss io n in D el aw ar e. D el

. C ode A n n
. ti t. 10, § 3104( c) ( 2010)

. Sect i on 10 3104( c) “i s t o be br oadl ycons trued t o confe rj ur i s di ct i on t o the
m a x im u m e x te n t p o s s ib le u n d e r t h e D u e P ro c e s s C la u s e .” H er cul es I nc. v. L eu T rus t & B anki ng ( B ahamas ) L t d. , 611 A

. 2d 4 7 6 , 4 8 0 -81 (D el. 1 9 9 2 ).
E ur ofi ns G r oup al l eges thatB i oA l l i ance Gr o u p tr ans act ed14 bus i nes s i n D el aw are , co n tr ac ted to p rov ide s erv ices in D elaw ar e, and ca us ed t or t i ous i nj uryi n D el aw ar e. Speci fi cal l y , E ur ofi ns G r oup as s ert s thatthe Tra ns ferA gr eem enti s bas ed on a j oi nt ventur e i n w hi ch B i oA l l i ance G r oup r et ai ns an d ass ert s act i ve contr ol over V I. F ur ther , E ur ofi ns G r oup ar gues thatthe T ransferA greem ent i s prem i sed on the incorporat i on of V I as a D el aw ar e corpor at i on. T hes e ar gum ent s ar e notper s uas i ve. T he t erm s of the Tra ns fer A gr eement do not i ndi cat e that V I i s a j oi nt ve ntur e orthatB i oA l l i ance G r oup r et ai ns any contr ol overV I

. T o the con tr ary , the penul t i m at e par agr aph of the T ransferA greem ent s t at es: N o tw ith stan d ing an ything to the co n tr ary cont ai ned i n thi s G ener al A gr eementori n anyof the otherT r ans act i on D ocument s , no partner s hi p, j o i n t v e n tu r e o r o th e r s i mi l a r a rr a n g e me n tor r el at i ons hi p i s b e i ng cr eat ed ors hal l exi s tbetw een B i oA l l i ance G r oup, on the one ha nd, and [] V I or E ur ofi ns , on the otherhand, underorw i th r es pect to th e T ra n s a c tio n D o c u m e n ts

. ( A pp. at68. ) T he T r ans fer A gr eement al s o s t at es expl i ci t l ythat

“ E u ro f in s w h o lly[ ] o w n s [ ]V I.” (A p p . a t 5 8 .)
I n addi t i on, the r ec o r d l acks evi dence thatB i oA l l i ance G ro u p p layed a n yp a rt in th e d e c isio n to in c o rp o ra te V I in D el aw ar e. W hi l e the purpos e of the Tra ns ferA gr eementw as the
com m er ci al i zat i on of the I P i n the U ni t ed St at es , ( A pp. at5 9 ), ther e i s no evi dence i n the r ecor d thatB i oA l l i ance G r oup had any int ent that V I be i nco rporat ed in D el aw are. T he record i s al so ber eftof evi dence that B i oA l l i ance G r oup engage s i n the
m a n a g e m e n t o f

V I.15 H er e, i ti s cruc ial t o di s t i ngui s h betw een A venar d, as an in d iv id u a l, an d B io A lli a n c e G ro u p , as c o rp o ra te e n tit ies . W h ile A venar d , as a mem berof V I ’ s boar d, does part i ci pat e i n the
m a n agem ent of V I, he d oes so i n h i s capacityas an i nd i vidu a l. It m a k e s n o d if

f e re n c e th a t h e w a s n o m in a ted b yB io A lli a n c e (in Fr ance ) , northatE ur ofi ns w as bound bythe T r ans ferA gr eement t o appoi nthi m
. I n otherw or ds , the r el at i ons hi p betw een E u r o f i n s Gr o u p a n d Bi o A l l i a n c e Gr o u p i s wh o l l yc o n tr a c tu a l

. As the D i s tr i ctC our texpl ai ned, bei ng the for ei gn par entof a D el aw ar e s ubs i di ary , w i thoutm or e, i s i ns uffi ci entt o confe r per s onal j ur i s di ct i on over a nonr es i dentdefe ndantunderthe D e l a w a r e l o n g - a r m s t a tu t e
. E u r o f i n s P h a r m a , 2 0 0 9 WL 2 9 9 2 5 5 2 , a t * 4 (c itin g M o n s a n to C o
. v
. S yn g e n ta S e e d s , In c ., 443 F. Supp

. 2d 636, 645 ( D

. D el

. 2006) )

. I tfol l ow s that B ioA ll ianc e G rou p ’s co n tr ac tual ri g h t t o selec t a bo ard
m e m b e r— a les se r in d ic ia o f c o n tro l th a n b e in g th e c o rp o ra te par e n to f

a Del a war e s u b s i d i a ry

— i s a l s o i n s u f f i c i e n t , wi th o ut
m o re , to c o n f

e r p e rs o n a l ju ri s d ic tio n o v e r B io A llia n c e G ro u p
. E ur ofi ns G r oup al so av ers thatthe part i es i nt ended that d isp u tes c o n c e rn in g th e T ra n sf e r A g re e m e n t b e lit ig a ted in D el aw ar e. T o s uppor ti t s cont ent i on, E ur ofi ns G r oup poi nt s t o an anci l l ary contr act , Schedul e 9 t o the T r ans fer A gr eement , w hi ch
c o n ta in s a D e l a w a re f

o ru m s e le c tio n c la u s e . (A p p . a t 1 2 3 -2 8 .) T h is a rg u m e n t, to o , is u n a v a ilin g
. B i oA l l i ance G r oup i s nota partyt o Schedul e 9. ( A pp. at 128. ) A ddi t i onal l y , E ur ofi ns G r oup admi t s thatthe p art i es fought
o v e r a f o ru m se lec tio n c lau se in th e T ra n sf e r A g re e m e n t, bu t in th e e n d th e ya g r e e d t o o mi t s u c h a c l a u s e f r o m th e c o n tr a c t

. As such, Sched ule 9 doe s not r epresentthe part i es’ i ntentt o co ntes t th e is su e o f

th e p ro p e r f

o ru m in w h ich to re so lv e d isp u tes a t a16 la te r t im e
. T hus , even a cce pt i ng E ur ofi ns G r oup’ s al l egat i ons i n the compl ai ntas tru e, theyfai l t o es t abl i s h a pr i m a fa ci e ca s e of per s onal j ur i s di ct i on. M et cal fe, 566 F. 3d at330. T her e i s no i ndi cat i on thatB i oA l l i ance G r oup comm i t t ed anyactorom i s s i on i n D e l a war e , e i th e ri n c o n n e c t i o n wi th th e Tr a n s f e rAgr e e m ent
or the TA R A s o as t o perm i tj ur i s di ct i on t o be as s ert ed under
s ubs ect i ons ( c)( 1 ) or ( c) ( 3) of the D el aw ar e l ong- arm s t atut e. D el

. C ode. A nn. t i t

. 10, § 3104 ( c) ( 1) ( al l ow i ng forper s onal j ur i s di ct i on overa nonre s i dentw ho “tr ans act s anybus i nes s or per form s anychar act erof w o rk in [ D el aw ar e] ”) ; i d. at( c) ( 3) ( al l ow i ng forper s onal j ur i s di ct i on overa nonr es i d en tw ho

“ [ c ]a u se s to rtio u s in

ju ryin th e S ta te b ya n a c t o r o m iss io n in [ D e law a re ]” ); se e a lso T riS tra ta T e c h ., In c . v . N e o ter ic C os m et i cs , I nc. , 961 F. Supp. 686 ( D

. D el

. 1997) ( “I n or derfor
a courtt o exer ci s e j ur i s di ct i on unders ubs ect i ons ( c) ( 1) and (c )(3), so m e a ct m u st actua ll yo cc u r i n D elaw are
. ”). Fur therm or e, even i f Eurof i ns G r oup had notwai v e di t s ar gum ent bas ed u p o n s u b s e c t i o n ( c ) ( 2 ) b y f a i l i n g t o r a i s e i t b e f

o r e t he D i s tr i ctC our t , w hi ch i thas , E ur ofi ns G r oup cannotes t abl i s h that B i oA l l i ance G r oup contr act ed t o pr ovi de s ervi ces i n D el aw ar e, s i nce a ny servi ces B i oA l l i ance G r oup per form ed underthe T A R A w e re c a rr ie d o u t in F ra n c e
. S e e D e l. C o d e A n n . tit. 1 0 , § 3104( c) ( 2) ( al l ow i ng forper s onal j ur i s di ct i on overa nonr es i dent
w h o “ [ c ]o n tr a c ts to s u p p ly se rv ic e s o r t h in g s in [ D e la w a re ].” ).

E ur ofi ns G r oup al s o appea l s the deni al of i t s r eque s tfor j ur i s di ct i onal di s covery
. W e r evi ew the D i s tr i ctC our t ’ s deci s i on t o d e n y j u r i s d i c t i o n a l d i s c o v e ry f o ra b u s e o f

d i s c r e t i o n
. T o ys “R ” U s, 3 1 8 F. 3d at455. “I f the pl ai nt i ff pr es ent s fac tual17 al l ega ti o ns thats ugges t‘ w i th r eas onabl e part i cul ar i ty ’ the p o s s i b l e e x i s t e n c e o f th e r e q u i s i t e ‘ c o n t a c t s b e tw e e n [ th e p a r ty] and the forum s t at e, ’ the pl ai nt i ff’ s r i ght t o conductj ur i s di ct i onal d isc o v e rysh o u ld b e su sta in e d .” Id . (m o d if ica tio n in o rig in a l) ( quot i ng M el l on B ank ( E

. ) PSF S, N at ’ l A s s ’ n v. Far i no, 960 F. 2d 1 2 1 7 , 1 2 2 3 (3d C ir

. 1 9 9 2 )). A p lai n ti ff m ayn o t, h o w ev er, un dert ake a fi shi ng exp edit i on based o nlyup on bare al l egati on s, underthe gui s e of j ur i s di ct i onal di s covery
. B el den Techs

. , I nc. v
. L S C o rp., 6 2 6 F

. S u p p
. 2 d 4 4 8 , 4 5 9 (D

. D el. 2 0 0 9 ).
E ur ofi ns G r oup fal l s w oeful l ys hor tof m aki ng fac tual al l egat i ons s ugges t i ng w i th “r eas onabl e par t i cul ar i ty ” the pos s i bl e exi s t ence of cont act s betw een B ioA l l i ance G r oup and D el aw ar e. E ur ofi ns G r oup ar gued thatthe “he avi l yl aw y er ed”
n a tu re o f th e T ra n sf

e r A g re e m e n t l e a d s it to c o n c lu d e th a t itis unl i kel y , i f not i m pos s i bl e, thatB i oA l l i ance G r oup di d not part i ci pat e i n the dec i s i on t o i n co rpor at e V I i n D el aw ar e. T hat
r eas oni ng, how ever , m i l i t at es agai ns t E ur ofi ns G r oup’ s pos i t i on beca us e evi dence of any s uch par t i ci pat i on w oul d be i n E ur ofi ns G r oup’ s pos s es s i on and i s notdi s pos i t i ve of the i s s ue of w hether ju ri s d ic tio n a l d is c o v e ry is re q u ir e d

. T hus , w e af

fi r m the D i s tr i ctC our t ’ s d eni al of Eurof i ns G roup’s m ot i on forj ur i s di ct i onal di s coveryand the D i s tr i ct C our t ’ s di s m i s s al of the compl ai ntagai ns tB i oA l l i ance G r oup for l ack of per s onal j ur i s di ct i on. B
. P ers onal Juri s di ct i on O ver A venard E ur o fi ns G r oup al s o appea l s the D i s tr i ctC our t ’ s di s m i s s al of i t s compl ai ntagai ns tA venar d forl ack of per s onal j ur i s di ct i on. Speci fi cal l y , E ur ofi ns G r oup ar gues that the D i s tr i ctC our terr ed i n hol di ng t hat i tl acke d per s onal j ur i s di ct i on overA venar d under18 D el

. C ode A nn. t i t

. 10, § 3114( b) ( 2010)

. W e agr ee. S ec ti o n 3 1 1 4 (b) s ta te s tha t anyn o n reside n t of D elaw are w h o a c c e p ts e le c ti o n a s a n o f f ice r o f a D e law a re c o rp o ra tio n is d e e m e d to h a v e c o n se n ted to se rv ice o f p ro c e ss in a n ya c tio n in
w hi ch thatoffi ceri s a nec es s aryorpr operparty , ori n anyact i on ag ains t th at of

fice r fo r an yv iolati o n o f h is du ti es a s an o ff icer.

“ [ I]t is th e rig h ts, d u ties , a n d o b lig a tio n s w h ich h a v e to d o w ith
s ervice a s a di r ect orof a D el aw ar e corpor at i on w hi ch make a di r ect ors ubj ectt o per s onal s erv ice u n d erthe t erm s of” s ect i on 3114( b)

. H ana Ranch, Inc

. v. L ent , 424 A

. 2d 28, 30 ( D el

. C h. 1 9 8 0 ); s e e a ls o A rm s tr o n g v . P o m e ra n c e , 4 2 3 A .2 d 1 7 4 , 1 7 6 n .5 ( D el

. 1980) ( Sect i on 3114( b) aut h o ri zes the exe r ci s e of juri sd ict ion “o n lyin ac ti o n s w h ere d ir ec tors .

. . o f a D elaw are corpor at i on ar e nec es s ary or pr oper part i es or w her e the ca us e of
ac ti o n is gro u n d ed o n su ch ind ividu als ’ b rea ch o f th e f idu ciary du t i e s o wed t o a c o rp o r a t i o n a n d i t s o wne r s
. ” )

. Th u s , though A venar d m oved t o di s m i s s forl ack o f p ersona l j ur i s di ct i on, w h ethe r th e D istri ct C o u rthas perso n al j u ri sd ict ion o v er A v en ard i s , pur s uantt o § 3114( b) , actual l y a ques t i on of w hetherE ur ofi ns G r oup has s t at ed a c l ai m agai ns t A venar d i n hi s r ol e as a di r ect or o f V I u p o n w h ic h re lie f

m a yb e g ra n te d

. We r e v i e w de novo a d ist ri ctcou rt ’s decis i on t o d i sm i ss the compl ai ntforfai l ur e t o s t at e a cl ai m upon w hi ch r el i ef may be gr ant ed. D i que v. N ew J er s ey St at e Pol i ce, 603 F. 3d 181, 188 (3 d C ir. 2 0 1 0 ). “I n d e c id in g a m o tio n to d ism iss , all w e llpl eade d al l egat i ons of the com pl ai ntm us tbe t aken a s true and in terp re ted in th e lig h t m o st f a v o ra b le to th e p la in ti f f s, a n d a ll in f e re n c e s m u st b e d ra w n in f a v o r of th e m .” M c T e rn a n v . C ity
o f Y o rk , 5 7 7 F .3 d 5 2 1 , 5 2 6 (3 d C ir. 2 0 0 9 ). T o w ith sta n d a R u le 12( b) ( 6) m ot i on t o di s m i s s , “a c om pl ai ntm us tcont ai n s uffi ci ent19 f a c tu a l m a tter, a c c e p ted a s tru e , to ‘sta te a c laim to re lief th a t is p lau sib le o n its f

a c e .’” A sh c ro f

t v . Iq b a l, --- U .S . ----, 1 2 9 S . C t. 1937, 1949 ( 2009) ( quot i ng B el l A t l ant i c C orp. v. T w om bl y , 550 U

. S

. 5 4 4 , 5 7 0 (20 0 7 )). E ur of i n s Group al l eges that A venar d, i n hi s r ol e as d ir ec torof V I , br eac hed hi s fi duci arydut i es by f a ili n g to n o tifyV I o f A B L ’ s p a ten t cla im . A c c o rd in g to Eu r o f i ns G r oup’ s compl ai nt , “M r
. A venar d had know l edge of the A B L cl ai m at al l r el evant t i m es , i ncl udi ng pr i ort o exec ut i on of the T ran sfe r A g ree m en t. ” (A p p
. at 49

. ) “M o reo v er, M r. A venar d knew thatunderthe Tra nsfe rA gr eement , E ur ofi ns G r o u p a s s u m e d B i o A l l i a n c e G r o u p ’ s o b l i g a t i o n t o i n d e m n i f y, among ot her s , Speci al tyL abs foranyclaim s of i nfr i ngement arisi n g o u t of

the IP

. ” (A p p
. at 50

. ) A v en ard ’s si lenc e the ref o re

“ p ro tec ted B io A lli a n c e G ro u p ’s in t eres ti n av oidi ng its in d e m n ity
o b l i g a t i o n s t o S p e c i a l tyLa b s , k n o wi n g a l l th e w hi l e th a tABL had assert ed such a cl ai m that B i oA l l i ance G roup o therw i se w oul d have been requi r ed t o defe nd and s uffe rthe di s as tr ous fin an cial co n seq u en ce s o f th at ob li g ati o n
. ” (A p p
. at 50 -51

. )
T h e D istric t C o u rt c o n c lu d e d th a t th e c o m p lain t f a iled to
s t at e a val i d cl ai m forbr eac h of fi duci arydutyagai ns tA venar d. E ur ofi ns Phar m a, 2009 W L 2992552, at*6. Speci fi cal l y , the C o u rtfo u n d that E u rof ins G rou p f

a ile d to allege that A v en ard per s onal l y engage d i n anytr ans act i ons thatw er e ei therharm ful t o V I , orbenef

i ci al t o hi m
. I d. W e di s agr ee. U n d e r D e law a re law , a d ire c to r’s f id u c iar yd u tyo f

lo y a lty i ncl udes a dutyt o di s cl os e. B i g L ot s St or es , I nc. v. B ai n C api t al F u n d V II, L L C , 9 2 2 A .2 d 1 1 6 9 , 1 1 8 4 (D e l. C h . 2 0 0 6 ). T h e d u ty t o di s cl os e “i s nota gene r al dutyt o di s cl os e eve rythi ng the d ire c to r k n o w s a b o u t tran sa c tio n s in w h ich th e c o rp o ra tio n is i nvol ved. ” I d. R ather , i t i s “[t ] he i nt ent i onal fai l ur e orr efus al of20 a d ire c to r to d isc lo se to th e b o a rd a d e f a lca tio n o r sc h e m e to d e f ra u d th e c o r p o ra tio n o f w h ich h e h a s le a rn e d , [w h ich ] itse lf
c o n s t i tu t e s a w r o n g
. ” Ho o v e r I n d u s
. , I n c
. v
. C h a s e , 1 9 8 8 WL 73758, at*338 ( D el

. C h. J ul y 13, 1988) ( quot ed i n B i g L ot s , 922 A

. 2 d at 11 8 4 ).
B ig L o ts c ites se v e ra l e x a m p les o f c a se s in w h ich c o u rts h eld th at a d ir ec tor v iolated h is d u tyto d iscl o se u n d er D elaw are l aw
. Pr imaryamong t hos e ca s es i s H ol l i ngerI nt ernat i onal v. B lac k , 8 4 4 A .2 d 1 0 2 2 (D e l. C h . 2 0 0 4 ), th e “ p a ra d ig m a tic exampl e” of a di r ect or di s cl os ur e cas e, i n w hi ch the contr ol l i ng s har ehol derand di r ect orfai l ed t o di s cl os e tha th e was “ s hoppi ng” the companyi n vi ol at i on of a si g n ed contr actthatforbade s uch act i on. B i g L ot s , 922 A

. 2d at1184 ( ci t i ng H ol l i nger , 844 A

. 2d
a t 1 0 6 1 ). A v e n a rd a ttem p ts to d istin g u ish th e a ll e g a tio n s in E ur ofi ns G r oup’ s compl ai ntfr om H o ll i ngerand the other
ex am p les o f d ir ec tor d iscl o su re ca ses cit ed in B ig L o ts. A v en ard i s corr ect i n dis t i ng uis hing tho se ca ses, as the all egati on s i n those
c a se s d o n o t m irro r th o se m a d e h e re . T h e d iss im ilarityd o e s n o t, how ever , m andat e thatthe compl ai ntagai ns tA venar d be d is m is s e d

. I ns t ead, w e r ead B ig Lot s m or e br oadl ythan does A venar d. W her eas he ar gues thatB i g L ot s pr ovi des the s um t ot al of the types of d ir ec tordi s cl os ur e cl ai m s thatw i l l s ur vi ve a m ot i on t o di s m i s s , w e do notthi nk the B i g L ot s courti nt ended the exa m pl es of di r ect or d is cl os ur e cl ai m s i tpr ovi des t o be exhaus t i ve. T he compl ai ntal l eges that , pur s uantt o the Tra ns fer A gr eement , E ur ofi ns G r oup as s um ed the i ndemni tyobl i gat i ons to S p eci al tyL abs form er l yas s um ed byB i oA l l i ance G r oup. A ddi t i onal l y , the compl ai ntal l eges thatatthe t i m e the Tra ns fer A g ree m en t w as e x ec u ted a n d the tran sac ti o n c lose d , A v en ardA v e n a rd a lso a rg u e s tha t th e c o m p lain t ag a in st h im sh o u ld 11 b e d i s m i s s e d u n d e r I q b a l b e c a u s e i t i s i m p l a u s i b l e
. S p e c i f i c a l l y, at or al ar gum ent , couns el ar gued t hat the econom i cs of the dea l
m ake the al l egati on s i m plausi ble. W hat kind of fraud i s it , 21 knew t hatA B L had as s ert ed a cl ai m agai ns tthe I P l i cens ed by E ur ofi ns G r oup t o S p eci al tyL abs

. Y et , acc or di ng t o the compl ai nt , A venar d nevercame forw ard w i th thatm at er i al inf o rm ati o n an d all o w ed V I to assu m e B ioA ll ianc e G ro u p ’s
o b lig a tio n s a n d e x p e n s e s in c o n n e c tio n w ith th e IP . “ In s h o rt ,”
as the compl ai ntall eges, “M r
. A venar d favor ed the i nt er es t s of B io A llia n c e G ro u p a n d h im s e lf o v e r th o s e o f V I.” (A p p . a t 5 1 .) T h u s, th e c o m p lain t sta tes a c laim th a t A v e n a rd b re a c h e d h is d u ty of l oy al tyt o V I by fai l i ng t o i nform V I , at the t i m e he bec ame a d ir e c to r o f

V I, o f A B L ’s c la im a g a in s t th e IP

. T h e f a ilu re to in f

o rm V I w a s p o ten ti a llyh a rm f u l to E ur ofi ns G r oup. V I w as as s ur ed bycontr actthat ther e w er e no know n cl ai m s th at co u ld im p ac t i ts i n d em n ifi ca ti on re sp o n sib ili ties , b u t th a t w a s n o t tru e
. F u rth e r, it is c o n c e iv a b le th a t Av e n a r d b e n e f

i t t e d f r o m h i s f a i l u r e t o d i s c l o s e ABL’ s c l a i m. A s the compl ai ntal l eges, A venar d’ s s i l ence coul d have be en inten d ed to— an d , in f ac t, d id— serv e B ioA ll ianc e G rou p ’s i nter est i n avo i ding i t s indem nity ob l i gati on s to Sp eci al tyL abs, b e c a u se B io A lli a n c e G ro u p k n e w th a t A B L h a d to ld it ( B i oA l l i ance G r oup) that Speci al ty L abs ’ us e of the IP vi ol at ed A B L ’ s pat ent s
. I tfol l ow s thatA venar d, the co- founder and chi ef oper at i ng offi cerof B i oA l l i ance , coul d have de r i ved per s onal benef i tfr om s hi ft i ng the i ndemni fi cat ion r es pons i bi l i tyfr om B ioA ll ianc e G rou p to E u rof ins G rou p
. T h ese a lleg ati o n s are suffici ent t o survi ve a m oti on t o d i sm i ss. 11couns el as ked the C our t , w her e y ou getm er el yt en dol lars up fr ontand agr ee t o pr ovi de t echni cal s uppor tatcos tforthr eeand -a- half y ears ? C ou nsel ’s st at em ent o f t he co ntr actt erm s, h o w e v e r, ig n o re d th e in d e m n if ica tio n p ro v isi o n
. It is h a rd ly i m p l a u s i b l e th a t a n i n d i v i d u a l m a y s e e k t o b e n e f i th i s c o m p a n y, and hi m s el f, byoffl oadi ng the r es pons i bi l i tyt o i ndemni fythat
com pan y ’s licensees onto another com pan yi n w hich he h as a l es s ers t ake.

22 T hus , w e vac at e the D i s tr i ct C o ur t ’ s di s m i s s al of the b re a c h o f

lo y a ltyc laim a g a in st A v e n a rd o n th e g ro u n d th a t it la c k e d p e rs o n a l ju ri s d ic tio n o v e r h im

. C. For um N

on Conv e nie ns F inally , E u rof

ins G rou p ap p ea ls th e D istri ct C o u rt ’s deci s i on t o di s m i ss the compl ai ntagai ns tal l part i es underthe d o ctri ne of f

or um non conve ni ens
. W e r e v i e w f o r a b u s e of di s cr et i on the D i s tr i ctC our t ’ s d ism is s al of the compl ai ntunder f or um non conve ni ens
. W i ndt v. Q w es t C om m s
. I nt ’ l , I nc. , 529 F

. 3 d 1 8 3 , 1 8 9 ( 3 d Ci r
. 2 0 0 8 )

. F o rth e r e a s o n s s e t f o r th b e l o w, we w ill a f f ir m th e D is tr ic t C o u rt ’s d e c is io n
. U nderthe doctr ine of f or um non conve ni ens , a di s tr i ct
cou rtm ay , i n the exerci se of i t s sou nd dis cret i on , dis m i ss t he case
w her e: ( 1) an al t ernat i ve forum has j ur i s di ct i on t o hearthe ca s e; and (2) w hen tri al i n the plai nti ff’s chosen fo rum w ou l d est abli sh oppr es s i venes s and vexa t i on t o a defe ndant out of al l pr opor t i on to th e p lain tiff ’s c o n v e n ien c e , o r w h e n th e c h o se n f o ru m is i nappr opr i at e due t o t he court ’ s ow n admi ni s tr at i ve and l egal p r o b l e m s . W in d t, 5 2 9 F .3 d a t 1 8 9 (c itin g K o s te r v . (A m .)23 L u m b erm en s M u t. C as. C o
. , 3 3 0 U

. S

. 5 1 8 , 5 2 4 (19 4 7 )). “[W ] h en cons i der i ng a mot i on t o di s m i s s on f or um non con veniens gr ounds , a di s tr i ctcourtm us tfi r s tdet erm i ne w hether an ade quat e al t ernat e forum can ent ert ai n the cas e. ” I d. at189- 9 0

. If a n ad eq u ate a lt ern ati v e f o ru m e x ist s, the d istri ct co u rt
m us t d e t e r mi n e n e x t th e a p p r o p r i a t e a mou n t o f d e f e r e n c e t o be gi ven the pl ai nt i ff’ s choi ce of forum
. I d. at190. A ft erthe di s tr i ctcourthas det erm i ned the amount of def er ence due t o the pl ai nt i ff’ s choi ce of

forum , the d ist ri ctcourtm us tbal ance the
r e l e v a n tp u b l i c a n d p r i v a t e i n t e r e s tf a c t o r s
. I d

. “ I f

th e b a l ance o f th e se f a c to rs in d ica tes th a t trial in th e c h o se n f o ru m w o u ld
re su lt i n o p p re ss io n o r v e x a tio n to th e d e f e n d a n t o u t o f

a ll p r o p o r t i o n t o th e p l a i n t i f f ’ s c o n v e n i e n c e , th e d i s tr i c tc o u r tm a y, i n i t s di s cr et i on, di s m i s s the ca s e on f or um non conve ni ens gr ounds

. ” I d.
H er e, the D i s tr i ct C our t det erm i ned thatFr ance pr ovi des an ade quat e al t ernat e forum for thi s l i t i gat i on. I t found thateac h of the def

endant s i s amenabl e t o s ervi ce of pr oces s i n Fr ance and that , i n anyevent , none of the de fe n d an ts w i l l cont es tper s onal j ur i s di ct i on t her e. E ur ofi ns , 2009 W L 2992552, at*7. E ur ofi ns G roup d oes no tchall eng e these con cl usi on s. Itcon t end s, how ever , that Fr ance cons t i tut es an i nadequa t e forum on s ever al gr ounds

. I tar gues thatFr ench pr act i ce n eit h er pr ovi des for depos i t i ons as a di s covery devi ce nor pr ovi des a m etho d for
o b t a i n i n g d o c u m e n t s f

r o m a n o b

j e c t i n g a d v e r s a ry o rn o n - p a r ty. A d d iti o n a lly , E u ro f

in s G ro u p a rg u e s th a t, un d e r F re n c h law , itE u ro f in s G ro u p a lso a rg u e s th a t F ra n c e is a n in a p p ro p ria te 12 f o ru m b e c a u se B io A lli a n c e G ro u p tried , an d f a iled , to n e g o tiate f o r a F re n c h f

o ru m se lec tio n c lau se in th e T ra n sf e r A g re e m e n t,
a n d thu s cou l d not hav e reas on ably exp ect ed t o l i t i gate in F ra n c e . T h e f

a ilu re o f th e p a rties to a g re e o n a f o ru m to ent ert ai n di s put es , how ever , s i m pl y m eans that , i n the eventof l i t i gat i on, they w o u ld do ba t t l e on the i s s ue i n court , as the p a rties in th is c a se a re d o in g n o w
. T o sa yth a t an a g re e m e n t to l eave an i s s ue foranotherdaycr eat es a r oadbl ock t o t aki ng up th a t issu e a g a in is illo g ica l a n d u n f a ir. T h e p a rties ’ f

a ilu re to
se lec t a f

o ru m is n o t an a p p ro p ria te b a sis u p o n w h ich to
c o n c l u d e th a tF r a n c e i s a n i n a d e q u a t e f o ru m.
24 c o u ld n o t co m p e l A B L to a p p e a r a t trial. 12
N one of thes e ar gum ent s i s compel l i ng. R egar di ng the avai l abi l i ty o f di s covery , ther e ar e ade quat e di s coverym ethods
a v a ilab le to lit ig a n ts u n d e r F re n c h L a w . S e e , e .g ., E rn st v . E rn st, 7 2 2 F . S u p p . 6 1 , 6 7 -6 8 (S .D .N .Y . 1 9 8 9 ) (F ra n c e is a n a d e q u a te fo rum b ec au se “ there are sev era l perf ec tl yad eq u ate d isco v e ry m ethods avai l abl e underFr ench l aw , al bei tnotas ext ens i ve as thos e ava i l abl e i n ourcourt s
. ”)

. C oncerni ng the ava i l abi l i tyof
m ethods t o compel A B L t o ap p ea rattr i al , E ur ofi ns G r oup conce ded ator al ar gum entthatA B L i s al r eady a partyt o ongoi ng l i t i gati on betw een these par t i es i n France. (See al so A pp el l ees’ B r
. 40 ( “A B L i s a par ty t o the F r ench A ct i on now pendi ng i n the C om m er ci al C our ti n Par i s , and i t h as notchal l enged the j ur i s di ct i on of thatC our t

. ”)

. ) T her efor e, even i f Eurof i ns G r oup corr ect l ys t at es the “vi r tual i m pos s i bi l i ty ” of att ai ni ng evi dence from no n-part i es, this “cri t i cal ” fact is m o o t b ecause A B L i s aE u ro f in s G ro u p a lso a rg u e s tha t F ra n c e is a n in a d e q u a te 13 f o ru m b e c a u s e o f

F re n c h c o u rts’ la c k o f f a m ili a rityw ith D el aw are l aw
. T hi s i s nota gr ound forfi ndi ng Fr ance an inad eq u ate f

o rum ; r athe r, itis o n e of the pu b li c i n terest fac tors thatw e cons i derb elow

. C f. Pi perA i r cr aftC o. v. R eyno, 454 U

. S. 235, 255, 260 ( 1981) ( di s cus s i ng fami l i ar i tyof for ei gn l aw in th e c o n te x t o f

p u b lic in te re s t f

a c to rs ).
W her e a pl ai nt i ff c annotacc es s evi dence es s ent i al t o pr ove 14 a cl ai m i n an al t ernat i ve forum , thatforum i s i nadequa t e. L ace y v. C essna A i rcr aftC o. , 93 2 F. 2d 17 0, 19 1 (3d C i r. 19 91 ). T hu s, i f the comm uni cat i ons betw een A B L and B i oA l l i ance G r oup w er e es s ent i al t o E ur ofi ns G r oup’ s cl aim s, and i f evi dence of tho se co m m un i cat i on s w as, as E urofi ns G roup argu es, i nacc es s i bl e t o E ur ofi ns G r oup i n Fr ance , then Fr ance w oul d be
a n i n a d e q u a t e f

o ru m f o r th i s c a s e
. A B L , h o w e v e r , i s a l r e a d y a party t o the l i t i gat i on i n Fr ance ; thus , w hether orhow evi dence
m a yb e p ro c u re d f

ro m n o n - p a r ties u n d e r F re n c h p ro c e d u re is
m o o t.
25 p art yt o the Fr ench l i t i gat i on. T he Supr eme C our thas 13
c o u n s e le d th a t “ in ra re c ir c u m s ta n c e s , . . . w her e the r em edy
o ffe r e d b y t h e o th e rfo r u m is c le a r ly u n s a tis fa c to r y , the other forum m ay not be an adequa t e al t ernat i ve. ” Pi per A i r cr aft C o. v. R eyno, 454 U

. S. 235, 255 n. 22 ( 1981) ( emphasi s added)

. H er e, b e c a u se F ra n c e is n o t a “ c lea rl y u n s a tisf a c to ryf o ru m ,” it pr ovi des an ade quat e al t ernat i ve forum forthi s l i t i gat i on. 14
A ft erconcl udi ng thatF ran ce w as an ade quat e forum for the part i es ’ di s put e, the D i s tr i ct C our tnextconcl uded thatthe defe r ence o w ed t o E ur ofi ns G r oup’ s choi ce of forum w asIn it s rep ly b ri ef , E u rof ins G rou p ac cu ses th e D istri ct C o u rt 15 of f a ili n g to acco rd anydefe rence t o it s ( E urofi ns G roup’s) choi ce of forum
. Si nce thatar gum ent w as not r ai s ed i n E ur ofi ns G r oup’ s openi ng br i ef, i t i s w ai ved. See Labor er s ’ I nt ’ l U ni on of N

. A m
. , A FL

- C I O v. Fost erW heel er C orp. , 26 F. 3d 375, 398 (3 d C ir. 1 9 9 4 ) (“ A n iss u e is w a iv e d u n les s a p a rty ra ise s itin its openi ng br i ef, and for thos e purpos es a pas s i ng r efe r ence t o an issue

. . . w il l n o t su ff

ice t o b ri n g that issue b ef o re this co u rt

. ”). R egar dl es s , w e do not agr ee thatthe D i s tr i ctC our tfai l ed t o gi ve E ur ofi ns G r oup’ s choi ce of forum i t s due defer ence
. I n fi ndi ng t hat“ th e p l a i n t i f

f s ’ c h o i c e o f a Del a war e f o ru m i s far
ou tw ei gh ed b ythe b urdens that a D el aw are forum w ou l d im po se on thes e def

end an ts , ” Eurof

i ns , 2009 W L 2992552, at*7, the D i s tr i ctC our tbal ance d the r e l e v a n tf a c t o r s a gai ns tthe def

er ence it h ad ac co rde d E u rof

ins G rou p ’s ch o sen fo rum
. T h o se f ac tors
a re d is c u s s e d b e lo w
. 26 ou tw ei gh ed bythe rel evan tpri vate and p ub l i c i nter estfact ors. 15 T he pr i vat e i nt er es t fac t or s that the D i s tr i ct C our tm us tcons i der i ncl ude th e re lativ e e a se o f a c c e ss to so u rc e s o f p ro o f; av a ilab ili ty of compul s orypr oces s foratt endanc e of unw i l l ing, and the c ostof o btai ning at t end ance o f w i l l i ng , w i tnesses; pos s i bi l i tyof vi ew o f pr emi s es , i f vi ew w oul d be
a p p r o p r i a t e t o th e a c t i o n ; a n d a l l o th e rp r a c t i c a l p r o b l e ms t h a tma k e t r i a l o f

a c a s e e a s y , e x p e d i t i o u s a nd i nexpens i ve. G u lf O il C o rp . v . G ilb e rt, 3 3 0 U .S . 5 0 1 , 5 0 8 (1 9 4 7 ). T h e p u b lic i nt er es tfac t or s i ncl ude27 the a d m inistrati v e d ifficu lt ies flow ing fro m co u rt conges t i on; the “l ocal i nt er es ti n havi ng l ocal i zed
c o n tro v e rsie s d e c id e d a t h o m e ” ; th e in ter e st in havi ng the tr i al of a di ver s i tycas e i n a forum that i s athom e w i th the l aw that m us tgovern the
a c t i on ; the avoidance of unn ecessary problem s in confl i ctof l aw s , ori n the appl icati on of for ei gn l aw ; and the unfa i rnes s of bur deni ng ci t i zens i n an u n r e l a t e d f

o ru m w i th j u ry d u ty. Pi perA i r cr aft , 454 U

. S. at241 n. 6 ( quot i ng G ul f O i l , 330 U

. S. at 5 0 9 ).
T he D i s tr i ctC our tci t ed the fol l ow i ng fac t s as t i ppi ng the bal ance i n favor of l i t i gat i on i n Fr ance : “( 1) the i ni t i al offe rfor the s al e of the I P at i s s ue i n thi s l i t i gat i on w as ext ended i n Fr ance bya Fr ench e nt i ty ; ( 2) the contrac t at i s s ue i n thi s act i on w as fi nal i zed a nd exec ut ed i n Fr ance ; ( 3) al l of t he sour ces of pr oof
ar e l ocat ed i n Fr ance , i ncl udi ng document s w r i t t en i n Fr ench a nd keyw i tnes s es ; and ( 4) the t hi r d- partyatthe ce nt erof thi s contr act d i s p u t e c o n d u c t s b u s i n e s s i n F r a n c e
. ” E u r o f i n s , 2 0 0 9 WL 2 9 9 2 5 5 2 , a t * 7

. R e g a rd in g th e p riv a te f

a c to rs, E u ro f

in s G ro u p a rg u e s th a t, underFr ench pr act i ce, i tw oul d have no abi l i tyt o obt ai n key evi dence fr om non- part i es t o a sui t , s uch as A B L

. T hi s ar gum ent
r epea t s one of Eur ofi n s G r oup’ s as s ert ed gr ounds forfi ndi ng Fr ance an i nadequa t e forum , and w e re j ect i t on the s ame gr ounds
as w e di d i n thatcont ext

. E ur ofi ns G r oup al s o poi nt s outthatnot
a ll w itn e ss e s a re lo c a ted in F ra n c e , sin c e A B L is lo c a ted in L u x e m b o u rg , o n e o f

E u ro f in s G ro u p ’s n e g o tiato rs is b a se d in N ew Y or k, and a f

or m er , now defunc t, su b l i cens i ng agentof28 A B L u s e d to b e b ase d in M assa ch u sett s. T h e re co rd, ho w ev er, r evea l s t h att he maj or i tyof keyw i tnes s es and s our ces of pr oof
ar e, i n fac t , l ocat ed i n Fr ance o rthe Europe an U ni on. A s s uch, even i f the D i s tr i ctC our ts t at ementthat“al l of the s our ces of p ro o f a re lo c a ted in F ra n c e ” o v e rsta ted th e m a tter, th e C o u rt d id notabus e i t s di s cr et i on i n deci di ng that the l ocat i on of the gr eat
m a jo ri ty o f p ro o f a n d w itn e s s e s in F ra n c e f a v o rs d is m is s a l. O u r c o n c lu sio n th a t p e r s o n a l ju risd ictio n e x ists a s to A venar d buti s lacki ng overB i oA l l i ance G r oup bol s t er s the C our t ’ s concl us i on thatthe pr i vat e i nt er es tfac t or s w ei gh i n favor of di s m i s s al becaus e, i f th e clai m agai ns tA venar d w er e t o be hear d in D el aw ar e, the part i es w oul d fac e the s ubs t ant i al i nconveni ence of l i t i gat i ng tw o a c t i ons , w hi ch i nvol ve a c om m on nucl eus of oper at i ve fac t s , i n tw o for a. T hus , al l ow i ng the ac t i on agai ns tA venar d t o pr ocee d i n D el aw ar e w oul d notm ake tr i al of thi s c a s e “ e a s y , e xp e di t i ou s a nd i ne xp e ns i ve , ” G ul f Oi l , 33 0 U. S. at508. A s t o the publ i c fa ct or s , E ur ofi ns G r oup cont ends thatthe D i s tr i ctC our t s houl d have gi ven m or e w ei ghtt o the fa ctthatthe contr act s under l y i ng the curr entdi s put e a re governed by D el aw ar e l aw
. A l though the C our ts houl d have c ons i der ed that fac ti n i t s anal y s i s , w e s ee no abus e of di s cr et i on i n w hatw e t ake t o be the thrus t of t he C our t ’ s anal y s i s

— that di s m i s s al on f or um non conve ni ens g ro u n d s is a p p ro p ria te b e c a u se th e lit ig a tio n is focus ed on Fr ench defe ndant s ’ al l eged br eac hes of contr actand fid u ciaryd u ti es, w h ich to o k p lac e in F ran ce , an d , there fo re F rance has a m ore si gn i fi cant i nter esti n resol ving t he d i spute than D el aw ar e. See L ace y v. C es s na A i r cr aft C o. , 862 F. 2d 38, 48 (3d C ir

. 1988) ( “I n eval uat i ng the publ i c i nt er es tfac t or s the d istr ic t co u rt m u st ‘c o n sid e r th e lo c u s o f th e a lleg e d c u lp a b leA tor al ar gum ent , E ur ofi ns G r oup ar gued thatthe D i s tr i ct 16 C our tabus ed i t s di s cr et i on bydi s m i s s i ng the ac t i on on the gr ound of f

or um non conve ni ens beca us e l i t i gat i on i n F rance w ill re q u ire a ju d g e sc h o o led in c iv il l a w to a d ju d ica te a d isp u te governed by comm on l aw
. A s thi s C our tobs erved, that
ar gum entw ould m il i t at e aga i ns tcons i der i ng Fr ance as an appr opr i at e forum i n cas es or i gi nat i ng fr om ourcomm on l aw s y s te m
. W hi l e t he publ i c i nt er es t fac t or s i ncl ude “the avoi dance
o f u n n e c e s s a ry p ro b le m s
. . . in th e a p p lic a tio n o f f o re ig n la w ,” W i ndt , 529 F. 3d at189, ther e i s no s uppor tforthe propos i t i on thatthi s fac t ori s s o overw hel m i ng that i t t i ps the s cal es i n favor of hea r i ng the ca s e agai n stA venar d i n D el aw ar e. E ur ofi ns G r oup’ s ar gum ent“i gnor es the Supr eme Court ’ s demonstr at ed
29 conduct , oft en a di s put ed i s s ue, and the connecti o n of that conduct t o p l a i n t i f

f ’ s c h o s e n f

o ru m. ’ ” ( q u ot i ng V an C a u w e n b e rg h e v . B ia rd , 4 8 6 U .S . 5 1 7 , 5 2 8 (1 9 8 8 ))

. T h e m e r e f

a c t th a t ce rta in d o c u m e n ts a re w ritten in E ngl i s h i s i ns uffi ci ent t o change that concl us i on. Fur ther , though D el aw ar e has “a s i g n ifi canti nt er es ti n act i vel yover s eei ng the conductof thos e ow i ng fi duci arydut i es t o the s har ehol der s of D el aw ar e c o rp o r a t i o n s , ” Arms tr o ng v. Pom er ance , 423 A

. 2d 174, 177 ( D el

. 1980) , thati nt er es ti s al s o i ns uffi ci entt o outw ei gh the l o c u s o f th e a l l e g e d c u l p a b l e c o n d u c t i n th i s c a s e
. A d d i t i o n a l l y, l i t i gat i on i n Fr ance w i l l av o id the pos s i bi l i tyof i ncongruous r es u lt s s t emm i ng fr om par al l el act i ons i nvol vi ng E ur ofi ns G r oup’ s cl ai m s
. T he C om m er ci al C our t i s al r eadyendea vor i ng t o r es ol ve thi s di s put e, and w i l l cont i nue i t s eff or t s i ndepende nt of ourdeci s i on. 16w i l l i ngnes s t o di s m i s s a ca s e on f orum no n co nven i ens gr ounds
even w her e the al t ernat i ve forum w i l l be fac ed w i th ques t i ons of A m er i can l aw
. ” A C L I I nt ’ l C om m odi tyServs
. , I nc. v. B anque Popul ai r e Sui s s e, 652 F. Supp. 1289, 1296 ( S. D

. N

. Y

. 1987) (cit ing P iper A ir cra ft, 4 5 4 U

. S

. at 26 0 ).
30 B oth the pr i vat e and publ i c i nt er es tfac t or s w ei gh i n favor
o f li ti g ati n g this d ispu te in F ran ce
. T h ere fo re, th e D istri ct C o u rt d id n o t abu se it s d isc re ti o n b yg ran ti n g B ioA ll ianc e G rou p ’s
m ot i on t o di s m i s s on f

or um non conve ni ens groun ds.
I V. CO NC L US I ON Forthe r eas ons expl ai ned above , w e af fi rm the D i s tr i ct C our t ’ s deci s i on thati tdoes nothave pe r s onal j ur i s di ct i on over B i oA l li an ce G r oup, w e af fi r m the D i s tr i ctC our t ’ s deni al of E u ro f in s G ro u p ’s m o tio n f

o r ju risd ictio n a l d isc o v e ry , w e v a c a te the D i s tr i ctC our t ’ s dec i s i on thati tdoes nothave pe r s onal juri sd ict ion o v er A v en ard , a n d w e a ff irm the D istri ct C o u rt ’s di s m i s s al of the compl ai n t o n the gr ound of f or um non conve ni ens
.