Court Opinion

ID: 4522506
Source: CourtListenerOpinion
Date Created: 2020-04-03 19:03:06.355699+00
Date Added: 2024-06-11T12:05:01.774195
License: Public Domain

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

MAVERICK THERAPEUTICS, INC.,       )
                                   )
             Plaintiff,            )
                                   )
and                                )
                                   )
MILLENNIUM PHARMACEUTICALS, ) C.A. No. 2019-0002-SG
INC.                               )
                                   )
             Plaintiff-Intervenor, )
                                   )
     v.                            )
                                   )
HARPOON THERAPEUTICS, INC.,        )
                                   )
             Defendant.            )

                         MEMORANDUM OPINION

                      Date Submitted: December 17, 2019
                         Date Decided: April 3, 2020

Jody C. Barillare, of MORGAN, LEWIS & BOCKIUS LLP, Wilmington, Delaware;
OF COUNSEL: Rollin B. Chippey II and Benjamin P. Smith, of MORGAN, LEWIS
& BOCKIUS LLP, San Francisco, California, Attorneys for Plaintiff.

John P. DiTomo, Elizabeth A. Mullin, and Aubrey J. Morin, of MORRIS, NICHOLS,
ARSHT & TUNNELL LLP, Wilmington, Delaware; OF COUNSEL: John Ruskusky
and Lisa C. Sullivan, of NIXON PEABODY, LLP, Chicago, Illinois, Attorneys for
Plaintiff-Intervenor.

Gregory P. Williams, Steven J. Fineman, Nicole K. Pedi, and Angela Lam, of
RICHARDS, LAYTON & FINGER, P.A., Wilmington, Delaware; OF COUNSEL:
Martin S. Schenker and Benjamin H. Kleine, of COOLEY LLP, San Francisco,
California, and Michelle S. Rhyu, of COOLEY, LLP, Palo Alto, California, Attorneys
for Defendant.

GLASSCOCK, Vice Chancellor
        This post-trial Memorandum Opinion concerns the application of medical

engineering at the molecular level, to permit the human body’s own defensive

mechanisms to more effectively destroy cancerous tumors. The science involved,

to the extent pertinent to the legal issues, is described below, at a descriptive level

consonant with the writer’s ability to comprehend it. Learning of the ability to

conceive of such an application of molecular science, and then of the work to apply

it to alleviate human suffering, is both humbling and inspiring.

        Unfortunately, the behavior of some of the parties, from a legal perspective,

is not inspiring, and the legal issues themselves are mundane. Defendant Harpoon

Therapeutics, Inc. (“Harpoon”) was in development of two methodologies to

enhance the cancer-fighting properties of “T cells” in humans.             To grossly

oversimplify, inherently active T cell enhancement activates T cells generally;

conditionally active enhancement activates T cells in the presence of tumors. Each

method has potential in the treatment of different cancers. Harpoon induced Takeda

Pharmaceutical Company Limited (“Takeda”) to invest in the conditionally active T

cell business, with Harpoon spinning off the conditionally active part of its business

to a new entity, Plaintiff Maverick Therapeutics, Inc. (“Maverick”) and Takeda

using     its   wholly    owned     subsidiary,    Plaintiff-Intervenor   Millennium

Pharmaceuticals, Inc. (“Millennium”), as an investment and collaboration vehicle to

work with Maverick. Part of the deal was a covenant by Harpoon not to compete
for four years in the existing conditionally active T cell field, the “Maverick Field.”

Immediately thereafter, however, Harpoon commenced development of a

conditionally active T cell process using a different activation method than the one

transferred to Maverick.         Maverick brought this litigation for breach of this

contractual non-compete and misappropriation of trade secrets, and Millennium

alleges fraud in the inducement of its investment in Maverick. This post-trial

Memorandum Opinion concerns whether the non-compete was drawn broadly

enough to encompass Harpoon’s new methodology (I conclude that it was not),

whether Harpoon developed that methodology through purloined Maverick trade

secrets (I conclude that it did not), and whether Harpoon fraudulently induced

Millennium’s investment (I conclude that it did).

       My reasoning is below.

                                    I. BACKGROUND1

       This is a post-trial Memorandum Opinion. The trial took place over six days,

September 9–13, and 17, 2019. The parties lodged 28 depositions and submitted a

1
  Citations to Joint Trial Exhibits (“JX”) are expressed as JX __, at __. Page numbers for JXs are
derived from the stamp on each JX page. For clarity, certain citations to JXs reference the section
number of a document (§) instead of the JX page. Citations in the form “Tr.” refer to the trial
transcript.

                                                2
joint exhibit list consisting of over 1200 exhibits.              The following facts were

stipulated by the parties or proven by a preponderance of evidence at trial.2

          A. The Parties and Relevant Non-Parties

          Plaintiff Maverick is a Delaware corporation with a principal place of business

in Brisbane, California.3

          Plaintiff-Intervenor Millennium is a Delaware corporation and wholly owned

subsidiary of non-party Takeda.4 Millennium’s principal place of business is in

Cambridge, Massachusetts.5

          Defendant Harpoon is a Delaware corporation with its principal place of

business in South San Francisco, California.6

          Non-parties Dr. Luke Evnin and Dr. Patrick Baeuerle founded Harpoon to

capitalize on potential cancer treatments they developed.7 Evnin is also the founder

of a private equity firm, MPM Capital, and has led investments in many

biotechnology companies.8 He serves as chairman of the board of directors for

2
  To the extent there was conflicting evidence, I have weighed the evidence and made findings
based on the preponderance of the evidence. In pursuit of brevity, I sometimes omit from this
Background discussion testimony in conflict with the preponderance of the evidence. In such
cases, I considered the conflicted testimony, and I rejected it.
3
    Join Proposed Agreed-Upon Findings of Fact, Docket Item (“D.I.”) 324 (“Stip.”), ¶ 1.
4
Id. ¶ 2.
5
Id.
6
    Id. ¶ 3.
7
Id. ¶ 4.
8
Id. ¶¶ 4–5.

                                                 3
Harpoon (the “Harpoon Board”) and previously served as chairman of the board of

directors for Maverick (the “Maverick Board”).9 Baeuerle serves as a director on

the Harpoon Board and previously served as an observer on the Maverick Board, as

well as acting as a member of Maverick’s Scientific Advisory Board and consultant

to Maverick’s management.10 Non-party Dr. Jeanmarie Guenot is also a co-founder

of Harpoon and served as Harpoon’s founding Chief Executive Officer (CEO) and

President.11

           B. Factual Background

                 1. T Cell Therapy

           T cell therapy is a leading area of drug development and a potential cure for

certain types of cancer.12 The human body produces “T cells,” white blood cells that

target and kill other cells in the body that are infected with viruses or pathogens.13

T cell engager drugs, or “T cell engagers,” are protein molecules designed in a

laboratory and injected into the blood stream.14 These therapeutic drugs bring the

body’s T cells and cancer cells together, causing the T cells to kill the cancer cells.15

9
Id. ¶ 5.
10
Id. ¶ 6.
11
Id. ¶ 7.
12
Id. ¶ 8.
13
Id. ¶ 11.
14
Id. ¶ 12.
15
Id.

                                             4
T cell engagers accomplish this through the use of “binding domains,” protein

structures that bind, or “engage” certain cells.16 T cell engagers, therefore, generally

have a “T cell engaging domain” to bind to T cells, and a “cancer targeting domain”

to bind to cancer cells.17

           Cancers, generally, can be placed into two categories: blood cancers and solid

tumor cell cancers.18 One problem T cell therapies encountered is that the T cell

engagers were “inherently active,” meaning they always recruited T cells and bound

to cancer cells.19 Unfortunately, certain healthy cells, including those in the body’s

vital organs, sometimes display the same proteins, called “antigens,” on their surface

as solid tumor cancer cells.20 Thus, “inherently active” T cell therapies risked

binding T cells to healthy cells and harming the patient.21 In blood cancers, T cell

therapies proved successful because even though the T cell therapy killed both

malignant and healthy blood cells, it did not kill the patient, given the body’s ability

to rapidly regenerate blood cells.22 The technology was not similarly benign,

16
Id.
17
     Id.
18
     See Tr. 504:6–505:1 (DuBridge).
19
     See Stip., ¶ 9.
20
Id.
21
     Id.; Tr. 504:6–505:1 (DuBridge).
22
     Stip., ¶ 10.

                                              5
however, when used to tread solid tumor cancer cells.23 Thus, to date, T cell

therapies have only been used to treat blood cancers, such as leukemia.24

                    2. Harpoon Develops the TriTAC and ProTriTAC Platforms

                         a. Inherently Active versus Conditionally Active T Cell
                         Therapies

          The goal in founding Harpoon was to develop T cell therapies for solid tumor

cancers by addressing the shortcomings of then-existing T cell therapies.25 Harpoon

did so in two ways. First, it developed a drug with three binding sites that, in

addition to binding to T cells and cancer cells, bound to a third site, a protein

normally found in the blood called albumin.26                Albumin prolongs the T cell

engagers’ existence in the body, giving it more time to work.27 A molecule with this

property of three binding sites is called “tri-specific.”28 Second, Harpoon developed

a “conditionally active” therapy using a “prodrug design” that worked like a normal

T cell engager but that remained inactive until it was in the presence of a cancer

cell.29 Cancer cells release certain unique enzymes, or “proteases,” and these

23
     See id. ¶ 9.
24
     See Tr. 1436:4–18 (Baeuerle).
25
     Stip., ¶ 13; Tr. 1078:6–22 (Evnin).
26
     Stip., ¶ 14.
27
Id. ¶¶ 14–15. Before this advancement, the body eliminated T cell engagers from the
bloodstream so quickly that patients required continual intravenous infusion to receive treatment.
Tr. 453:17–454:10 (Geesaman), 868:1–7 (Marasco).
28
     Stip., ¶ 15.
29
Id. ¶ 19.

                                                6
proteases “activate” the conditionally active T cell engager, with the result that it

only recruits T cells in the presence of cancer cells.30

           Thus, T cell therapies can generally be divided into “inherently active”

therapies and “conditionally active” therapies. Conditionally active therapies are

also referred to as “inducible” therapies, meaning the therapy drug’s active state is

induced at the tumor site. Thus, “conditionally active T cell therapy” and “inducible

T cell therapy” refer to the same concept.

           Harpoon called the first advancement—prolonging the life of the therapy drug

through albumin binding—its “TriTAC” platform.31 The TriTAC platform is an

inherently active T cell engager.32 Harpoon called the second advancement—

keeping the drug inactive until in the presence of a cancer cell—its “ProTriTAC”

platform.33 In early 2016, these developments were in the nascent stages, without

enabling data.34 In March 2016, Harpoon filed an initial patent application for both

concepts and potential compounds encompassed by the technology. 35 The patent

30
Id.
31
     Id. ¶¶ 14, 16. TriTAC is short for “Tri-Specific T-cell Activating Construct.” Id. ¶ 14.
32
     Tr. 1452:13–23 (Baeuerle).
33
   Stip., ¶ 22. ProTriTAC stands for “Pro-Tri-Specific T-cell Activating Construct.” In other
words, it is the TriTAC construct, but in addition it possesses the conditionally activated aspect
that makes it a “prodrug.” Tr. 505:19–506:8 (DuBridge).
34
     Tr. 518:21–519:6 (DuBridge), 1184:4–13, 1189:2–21 (Evnin).
 Stip., ¶ 20 (U.S. Provisional Application No. 62/305,092, titled “Inducible Binding Proteins and
35

Methods of Use”).

                                                   7
application stated the purpose of the technology was “to specifically destroy cancer

cells, while leaving healthy cells and tissues intact and undamaged.”36 At the time

of the patent filing, Harpoon had not yet decided on a specific molecule design for

its ProTriTAC therapy.37           The patent provided “non-limiting examples” and

contemplated alternative designs that could embody the technology described.38

           To date, the FDA has approved one inherently active T cell therapy, and that

approval is limited to treating blood cancers.39 The FDA has not approved any

conditionally active T cell therapies.40

                          b. The ProTriTAC Molecule

           As noted above, Harpoon developed a conditionally active T cell engager it

called ProTriTAC.41           The ProTriTAC design had three “binding domains,”

sometimes referred to as “binding sites,” which are the parts of the molecule that

allow it to attach to specific cells it encounters in the body.42 The first binding site

36
Id.
37
  Tr. 1524:8–17 (Baeuerle); see also JX 132 (correspondence between DuBridge and Baeuerle
contemplating various molecule designs).
38
  JX 133, at 48–49 (Patent application stating, “[i]t should be understood that various alternatives
to the embodiments of the invention described herein may be employed in practicing the
invention.”), 58–60 (figures illustrating concepts).
39
     Stip., ¶ 18.
40
Id.
41
     See Id. ¶¶ 19, 22.
42
Id. ¶¶ 12, 14.

                                                 8
is the “cancer targeting domain,” which attaches to cancer cells.43 The second

binding site is the “T cell engaging domain,” which attaches to T cells. 44 The third

binding site is the “half-life extension domain,” which attaches to the albumin

protein that extends the molecule’s life.45

           The ProTriTAC’s T cell engaging domain was made of a “single chain

variable fragment,” or “scFv.”46 Two smaller chains comprise the scFv: a variable

heavy (vH) chain and a variable light (vL) chain.47 The vH and the vL chains must

be joined in order for the scFv to successfully form the T cell engaging domain and

enable it to recruit T cells.48

           Harpoon’s advancement was to create a design that “split” the scFv and held

the vH and vL chains apart until an activation event in the tumor microenvironment

(i.e. inside the tumor) permitted them to come together.49 Once allowed to come

together, the vH and vL chains made the scFv complete, thus “activating” and giving

43
Id. ¶ 14.
44
Id.
45
     Id.
46
     JX 133, at 17–19, 58–59.
47
     JX 133, at 58–59; Tr. 1725:2–11 (Lin).
48
   Tr. 1740:11–1741:20 (Lin). In some citations to the trial transcript for the ProTriTAC design,
the witnesses are explaining the functions of Maverick’s later COBRA molecule, but that molecule
is based on Harpoon’s original ProTriTAC design, and so, where such is the case, the testimony
accurately describes Harpoon’s original ProTriTAC design.
49
Id. at 589:1–5 (DuBridge).

                                               9
the T cell engaging domain the ability to effectively recruit T cells.50 In other words,

as Harpoon conceived it, the ProTriTAC design would be unable to effectively

recruit T cells until an activation event caused by an element present in cancer

tumors removed the split in the scFv, thus permitting T cell recruitment.51 Harpoon

sometimes referred to this approach as the “split scFv” or “split dimer” concept.52

          Associated with this concept of activation is the concept of “binding affinity.”

Essentially, binding affinity is the measurement of how long and with what degree

of strength two things tend to stay together.53 With the ProTriTAC molecule, the

vH and vL chains, on their own, have no binding affinity to T cells; once they come

together after the activation event, the complete scFv chain has a binding affinity to

T cells.54 The impairment—here, the split in the scFv chain—works much like an

on/off switch, preventing binding when it is in place, and permitting binding when

it is removed.55

50
Id. at 589:1–5 (DuBridge), 1740:11–1741:20 (Lin).
51
Id. at 1740:11–1741:20 (Lin).
52
Id. at 1079:18–1080:3-8 (Evnin), 583:9–23 (DuBridge).
53
Id. at 558:18–559:6 (DuBridge). Technically, binding affinity is the binding strength between
“a ligand and its binding site,” meaning the portion of the molecule that attracts a specific partner.
See id. at 616:23-617:2 (DuBridge). A molecule as a whole has a binding affinity, and the
particular binding sites on the molecule also have binding affinities, which may differ from the
binding affinity of the molecule, depending on the context. Id. at 1930:20–1931:23 (Tidor)
(discussing test that isolates the binding affinity of the immune effector target site from the binding
affinity of the whole molecule).
54
Id. at 1932:7–24 (Tidor).
55
Id. at 756:4–19 (Landes), 692:10–14 (May).

                                                  10
          Harpoon had two separate ideas for splitting the scFv to achieve a

conditionally active molecule.56 The first idea involved a “linker” that prevented the

formation of the scFv until a protease—the enzyme released by cancer cells—in the

tumor microenvironment cleaved the linker.57 The second idea paired “dummy”

domains with the existing domains: a dummy vH paired with the functional vL, and

a dummy vL paired with the functional vH.58 Once the molecule came within the

tumor microenvironment, the cancer cell’s proteases cleaved the links between the

dummy and functional domains, allowing the dummy domains to fall away and the

functional domains to come together, creating a fully-functional scFv with an active

T cell engaging domain.59 These two ideas shared a common feature: neither

approach allowed the ProTriTAC design to bind to T cells until proteases in the

tumor microenvironment cut the linkers away, allowing the vH and vL chains to

come together and create the fully-functional scFv.60

56
Id. at 1080:9–13 (Evnin).
57
     JX 133, at 59; Tr. 509:11–510:4 (DuBridge); Stip., ¶ 19.
58
     JX 155, at 4–5; Tr. 513:6–514:8, 582:18–23 (DuBridge).
59
     Tr. 583:1–5 (DuBridge).
60
Id. at 582:6–584:11 (DuBridge).

                                                 11
         This is a graphic representation of Harpoon’s ProTriTAC designs:

61

         These two approaches to creating conditionally active T cell engagers were

the only ones Harpoon had developed by the time it spun out the new company,

Maverick.62

                 3. Harpoon Spins Out Maverick

         Around the time of the patent filing in early 2016, Harpoon began considering

strategic transactions to sell off portions of its technology portfolio.63 At that point,

Harpoon was still actively developing both conditionally active and inherently active

61
     JX 131, at 60–61.
62
  Tr. 1079:20–1080:13 (Evnin), 1459:24–1460:8 (Baeuerle). Harpoon had a concept for another
conditionally active T cell engager called TetraTAC, discussed further below, but this engager had
four domains and therefore fell outside the “Maverick Field” the parties eventually developed. Tr.
1463:1–24 (Baeuerle).
63
Id. at 1080:20–1081:12 (Evnin).

                                               12
T cell therapies.64         It reached out to several companies regarding a strategic

transaction, but Takeda expressed the most interest.65 The parties quickly centered

on a build-to-buy structure for a potential transaction—meaning that Takeda would

invest in the new company and then have an option to purchase it after a certain time

period.66 Under the dual build-to-buy the parties discussed, Harpoon would spin out

certain technologies into a new company, Maverick, and Millennium—Takeda’s

subsidiary—would enter separate build-to-buy collaborations with each of Harpoon

and Maverick.67 The parties commenced negotiations with this structure in mind.68

          When negotiations commenced, Maverick did not yet exist, and so there was

some confusion over whether Harpoon’s counsel, Wilson Sonsini Goodrich &

Rosati (“WSGR”), represented both Harpoon and the not-yet-existing spinout,

Maverick, or just Harpoon.69 Harpoon contends it represented and negotiated on

behalf of the not-yet-existing Maverick.70 For practical purposes, a joint privilege

64
     Stip., ¶ 21.
65
     Tr. 1081:13–1082:4 (Evnin).
66
Id. at 1082:5–1083:17 (Evnin).
67
Id. at 1082:13–1083:11 (Evnin); Stip., ¶ 21.
68
     Stip., ¶ 21.
69
   Compare Tr. 379:7–11 (Hurff) (“Q: You also understood that [WSGR] was representing
Maverick during the negotiations of the ATA and collaboration agreement; isn’t that right? A:
Yes.”) with Tr. 1355:4–8 (Hostetler) (“Maverick was not a client of [WSGR], correct . . . ? A:
Yes, that is correct. It was not a client.”). WSGR’s attorney, at trial, testified that his firm
represented “the future interests of Maverick” because it wanted both companies to succeed. Tr.
1318:2–15 (Hostetler).
70
Id. at 1094:24–1095:4 (Evnin), 1318:2–15 (Hostetler).

                                                    13
between Harpoon and Maverick existed throughout this litigation regarding certain

communications between Harpoon personnel and counsel at WSGR.71                                 And

Harpoon’s co-founder Guenot would sign the spinout agreement for Maverick.72 As

a substantive matter, however, negotiations for the spinout as a whole were between

Harpoon on one side, and Takeda, acting through Millennium, on the other. 73 In

addition, although Millennium was not a party to the Asset Transfer Agreement (the

“ATA”) between Maverick and Harpoon, it commented on and approved that

agreement.74

                         a. The Parties Negotiate for Two Separate Build-to-Buys:
                         Harpoon and Maverick

          Much of the discussions in early negotiations centered on dividing the

technologies on which Maverick would focus versus the technologies on which

Harpoon would focus.              Harpoon emphasized that it possessed a “discovery

platform,” which would allow Millennium to invest at the earliest stages of

71
     This joint privilege applied through trial, requiring some courtroom choreography.
72
     See JX 1.
73
   Tr. 237:13–20 (Hurff), 714:22–715:9 (Hiett), 1189:22–1191:4, 1199:8–17, 1256:20–1257:18
(Evnin), 1340:16–1341:10 (Hostetler). The parties often refer to Millennium and Takeda
interchangeably. Millennium, in its briefing, refers to its claims as “Takeda’s causes of action.”
Post-Trial Response Br. of Millennium Pharmaceuticals, Inc., D.I. 321 (“Millennium Reply
Brief”), at i. For the sake of clarity, to the extent possible, I attempt to distinguish between these
entities in this Memorandum Opinion.
74
   Stip., ¶¶ 29–30. The Asset Transfer Agreement (“ATA”) also disclaims third-party
beneficiaries. JX 1, § 9.14.

                                                 14
development.75 Millennium witnesses testified that a discovery platform, to them,

meant “a breadth of potential” that covered an entire field or range of experimental

ideas.76 This understanding matched initial explorations: to maximize the value of

both build-to-buys, Harpoon would continue to work on inherently active T cell

therapies, and Maverick would be spun out to work on conditionally active T cell

therapies, with Millennium investing in both.77 Meetings between Millennium’s

Chris Arendt and Harpoon’s Patrick Baeuerle and Luke Evnin seemed to match this

concept of a broad platform for Maverick: they referred to the conditionally active

platform as a “discovery platform,” and Baeuerle described the conditional

technology as “modular,” which Arendt took to mean it was a versatile platform with

many elements that could be rearranged.78

          Harpoon’s representations at this time, including a presentation, identified the

Harpoon trajectory as working on the TriTAC platform—or inherently active

technology—and identified the Maverick trajectory as working on the ProTriTAC

75
     Tr. 22:6–9 (Hurff), 8:16–9:10, 12:4–11 (Arendt), 1255:14–18 (Evnin).
76
Id. at 8:16–9:10 (Arendt).
77
Id. at 20:16–24 (Arendt), 1082:13–1084:4 (Evnin) (testifying that Harpoon “would spin out the
nascent conditionally active technology into a new company, which we then referred to as
Maverick.”).
78
Id. at 12:4–23, 13:9–14:19 (Arendt).

                                                15
platform—or conditionally active technology.79 According to Millennium, Harpoon

never departed from this basic divide of the technologies.80

         In June 2016, Millennium sent concept sheets to Harpoon to begin

establishing the structure of the build-to-buy transactions.81 These concept sheets,

like the discussions, identified Harpoon’s pursuit of its inherently active platform (at

that time called TRIDENT) and Maverick’s pursuit of Harpoon’s inducible

platform.82 Six term sheets exchanged by Harpoon and Millennium over June and

July 2016 all stated that Maverick would spinout “technology and intellectual

property relating to [Harpoon’s] inducible T-cell engagement platform.”83

Millennium communicated through meetings and term sheets that the conditionally

active platform would require significant development, and that what attracted

79
  JX 143, at 65 (describing the partnership as dividing Harpoon into “TRIDENTS [i.e. inherently
active] (build to buy)” and “CD3 Inducible Platforms (spinout)”); Tr. 19:3–20:24, 21:8–23
(Arendt), 1082:13–23 (Evnin).
80
     Tr. 21:8–23, 25:21–26:14, 37:15–38:14 (Arendt); 222:17–223:19 (Hurff).
81
     See JX 156.
82
Id. at 2 (“Harpoon Collaboration. During a research term of approximately four years, the parties
would collaborate on the development of Harpoon’s Trident platform”), 4 (“Maverick Spin Out. .
. . Harpoon would spinout a newly created entity (‘Maverick‘) that would hold the technology and
intellectual property relating to its inducible T-cell engagement platform.”). The parties use the
terms “platform” and “space” interchangeably to describe areas of technology. Thus, the
“inducible space” or the “conditionally active platform” describe generally technologies associated
with conditionally active T cell engagers.
83
Id. at 4 (June 3, 2016 term sheet); JX 159, at 5 (June 13, 2016 term sheet); JX 168, at 8 (June
23, 2016 term sheet); JX 167, at 6 (June 24, 2016 term sheet); JX 169, at 8 (June 29, 2016 term
sheet); JX 191, at 8, 20 (July 21, 2016 term sheet).

                                                16
Takeda was the “bold vision” of the early-stage discovery.84 To achieve this,

Millennium witnesses testified, they intended the Maverick spinout to create a

“broad kind of ring fence” around the concept of the inducible T cell platform and

permit “different ways” to achieve conditionality, an intent they testified that they

communicated to Harpoon.85

          Presentations and term sheets through July and August 2016 maintained this

concept. Dr. Robert DuBridge, a Harpoon scientist who joined Maverick upon its

spinout, gave a presentation to Takeda emphasizing that the conditionally active

technology would have different iterations along the way, and that there would be

different ways to achieve conditional activation.86 Evnin, Guenot, and Baeuerle all

attended this presentation and did not voice disagreement with the description

DuBridge provided.87 At the same time as these discussions and presentations

described a broad discovery platform, they all focused on a conditionally active

design that utilized the “split scFv” feature of the ProTriTAC design, described

84
  JX 156, at 4, JX 167, at 3, 7; JX 168, at 3, 9, 14, 18; JX 169, at 9, 15, 20; Tr. 226:10–228:12
(Hurff), 31:6–33:24, 36:16–37:6 (Arendt).
85
  Tr. 36:11–39:17, 47:17–48:4, 48:9–18, 49:3–50:11, 50:14–51:11 (Arendt) (testifying Maverick
spinout intended to create “ring-fence” around inducible space); Tr. 96:10–21 (Arendt) (testifying
the “ring-fence” concept was communicated clearly to Harpoon); see also JX 191, at 23 (defining
“Maverick Platform Improvements” as “any optimization, enhancement, improvement or
modification to any of the [various] components of the Maverick Licensed Intellectual Property”).
86
     JX 155; JX 187, at 49; Tr. 42:22–44:2, 44:23–45:21 (Arendt), 526:18–527:5 (DuBridge).
87
     Tr. 46:8–17 (Arendt).

                                               17
above.88 In other words, while it expected to invest in a broad discovery platform,

Millennium understood that the existing technology Harpoon would spin out into

Maverick involved the “split scFv” design.89 This made sense, given that at the time

of these negotiations, Harpoon had never worked on or shown Millennium a

conditionally active platform that did not utilize this design.90

                         b. The Parties Define the Maverick Field as Millennium Settles
                         on a Single Build-to-Buy

          Once negotiations had progressed by August 2016, Harpoon commenced

defining the “Maverick Field”—the precise definition of what would be spun out in

the new company—in the ATA.91 By this point, Harpoon understood that Takeda

might invest in both build-to-buys, or it might invest in only one build-to-buy, and

so each company needed a “growth path” for its future.92

          Each side proceeded with negotiations, but they proceeded with distinct

concepts of what the Maverick Field encompassed. Millennium continued to view

88
     E.g. JX 152, at 7; JX 187, at 48–57; JX 278, at 5.
89
  See JX 171, at 2 (Arendt describing conditional aspect of Maverick as “scFv that has been sliced
in half”); JX 262, at 8 (describing “Inducible T-cell Engager Platform Overview” and noting that
activation is achieved by “local formation of a functional CD3 scFv”); JX 378, at 1 (describing
“scFv . . . coming together” as activation tool); JX 395, at 3–4 (describing Maverick “M[ode] O[f]
A[ction] as reconstitution of cleaved scFv”). One exception was that Millennium was aware of
Harpoon competitors that used different techniques for achieving conditionality, and they wanted
the “broad kind of ring fence” to encompass these alternative approaches. Tr. 50:14–51:11,
208:14–209:20 (Arendt).
90
     Tr. 144:22–147:24 (Arendt), 386:1–13 (Hurff).
91
     Evnin Dep. Tr. Vol. I, 90:10–92:6; JX 195-A.
92
     Tr. 1089:1–11 (Evnin).

                                                  18
the Maverick Field as a broad discovery platform ring-fencing the concept of

inducible T cell engagers.93            Further, Millennium personnel believed they

communicated this understanding to Harpoon through various meetings,

discussions, and emails.94 By contrast, internal emails between Evnin, Guenot, and

counsel at WSGR—emails never shared with Millennium—reveal that they intended

the Maverick Field to be limited to the split scFv design described above, which was

the only concept of conditionally active T cell engager Harpoon had developed at

that point.95 Harpoon internally exchanged multiple drafts of the “Maverick Field”

(the contractual language that would ultimately define the transferred intellectual

property), revising the definition until, according to their testimony, they had what

they felt was a “[s]imple and clear” definition that captured the split scFv inducible

design.96

         Consistent with this intent to limit the Maverick Field, Harpoon and WSGR

made several revisions intended to “close loopholes” that could have allowed

93
     Tr. 223:8–224:14, 387:15–389:4 (Hurff), 52:15–54:20, 63:3–23, 69:17–24 (Arendt).
94
   JX 241 (September 2, 2016 diligence meeting overview); JX 278 (Presentation from September
2, 2016 meeting); JX 288, at 3 (meeting notes inquiring whether definition of Maverick Field is
“broad enough to capture all relevant rights that should be allocated”); Tr. 63:3–23, 69:17–24,
72:14–73:3 (Arendt), 241:11–242:2 (Hurff).
95
  JX 206, at 1 (discussing whether to give Maverick all inducible or only “the current Maverick
embodiment”); Tr. 1095:14–1096:16 (Evnin); Guenot Dep. Tr. 67:13–18; JX 227-A, at 1 (Evnin
writing, “trying to keep [the Maverick Field] focused on the current Maverick invention or
something very close to it”).
96
  JX 238, at 1 (WSGR counsel writing, “this matches my understanding of the technology and IP.
Simple and clear.”); JX 235, at 1; JX 220; Tr. 1333:5–19 (Hostetler), 1152:19–1153:1 (Evnin). .

                                               19
Harpoon to bypass the Maverick Field and utilize the split scFv design in the future.97

Counsel at WSGR testified that the intent was to protect Maverick’s right to exploit

the split scFv design while preserving Harpoon’s ability to continue to explore other

inducible technologies.98 In internal correspondence, WSGR counsel wrote that the

“main thing that shifts the balance is keeping the concept of inducible within

Harpoon.”99 Millennium, for its part, also requested revisions to the language in the

ATA, discussed further below, such as broadening terms to encompass all T cell

target sites rather than a specific one.100

          In late October 2016, after Millennium entered into non-disclosure

agreements and performed due diligence on Harpoon’s technology, it expressed an

interest only in Harpoon’s ProTriTAC platform, in other words, the inducible

technology to be spun out into Maverick.101 The parties proceeded with negotiations

toward the single build-to-buy, with Harpoon remaining an independent company.

          On November 3, 2016, Baeuerle sent plans for the separation of the companies

titled, “Separation of Harpoon (TriTAC platform) and Maverick (Pro-TriTAC

97
  See JX 318, at 1; Tr. 1349:1–10 (Hostetler); JX 246, at 1–2; JX 245, at 1; JX 251-A, at 1; JX
250-A, at 1–2; Tr. 1221:3–10 (Evnin).
98
     Tr. 1328:15–1329:13 (Hostetler).
99
     JX 246, at 1.
100
    Tr. 257:13–258:8, 260:21–261:2 (Hurff). Millennium also revised albumin-specific language
to a broader definition encompassing any half-life extending domain. Tr. 250:1–251:1 (Hurff).
101
      Stip., ¶ 22.

                                              20
platform).”102 Further, during this negotiation period, Harpoon did not employ the

term “Maverick design,” “split scFv,” or “split dimer” to describe what it intended

to transfer, nor do these terms appear in the finalized contracts.103         Harpoon

personnel testified that they thought communicating the limitations in the Maverick

Field definition was unnecessary because, as Evnin put it, he believed the definition

“was understood by all.”104 By contrast, Millennium witnesses testified that at

meetings they specifically discussed moving beyond the split scFv design, given that

it was unproven at that point.105

          Starting in November 2016, after Millennium had settled on a single build-to-

buy transaction, the negotiations hit a snag. Because it had decided not to purchase

Harpoon, Millennium agreed to license back all of the Maverick IP for Harpoon’s

use outside the Maverick Field (the “Grant-Back License”).106 At that point, the

Maverick Field was limited to immune effector target binders that bound to CD3,

the most popular and well-known T cell target.107 Millennium realized that as the

Maverick Field was drafted at that time, Harpoon would be able to “generate an

102
      JX 366, at 3.
103
   Tr. 78:13–79:10, 198:17–199:5 (Arendt), 450:6–15 (Geesaman); 532:11–533:1 (DuBridge);
1224:1–1225:10, 1261:21–1262:3 (Evnin), 1382:7–11, 1388:13–20 (Gerber), 1351:24–1352:3
(Hostetler); Guenot Depo. Tr. 21:18–25; JX 1, § 1.56.
104
Id. at 1261:21–1262:3 (Evnin).
105
      Tr. 78:13–79:10 (Arendt).
106
      JX 383, § 2.2(b).
107
      JX 383, § 1.50.

                                            21
essentially similar platform” simply by using a T cell target other than CD3. 108 It

proposed rewriting the definition to replace “CD3” with “Immune Effector Target,”

a defined term that included all T cell receptors, as well as adding the non-

compete.109

            In early December, Harpoon rejected the proposal to expand the Maverick

Field language from “CD3” to “Immune Effector Target.”110 At Millennium, Arendt

“freaked out.”111 He worried that without this expansion from “CD3” to “Immune

Effector Target,” he was “losing . . . exclusive inducible platform.”112 Hurff

summarized that Arendt hoped to “[b]uild a wall around all things T-cell (preclude

any inducible platform to Harpoon for T-cells, not just CD3).”113 Hurff, in the same

email, proposed alternatives to Arendt’s “minimum/final” position to “preclude any

inducible platform to Harpoon for T-cells.”114 These alternatives included limiting

the Grant-Back License, shortening the length of the non-compete for an expanded

field, or revising the financial terms.115      Ultimately, Millennium achieved the

108
      See JX 445, at 3.
109
      JX 406, §§ 1.43, 1.56, 7.5.
110
      See JX 433, at 13–14
111
      See JX 426, at 1.
112
      JX 445, at 2.
113
Id.
114
      Id. at 3–4.
115
Id.

                                           22
expanded definition, and the final Maverick Field reflects the broader “Immune

Effector Target” as a defined term, the definition of which includes all T cell

targets.116

            At the very end of December, two days before the ATA was signed, Evnin

wrote an email to Maverick CSO Hans-Peter Gerber and Harpoon CEO Dr. Gerald

McMahon summarizing the deal terms.117 In this summary, Evnin described the

Maverick Field as “inducible T cell engagers (except NKT cells) of the ‘Maverick’

design.”118 The next day, Guenot wrote to the Harpoon and Maverick Boards,

summarizing the deal, and used this same language: the Maverick Field would be

“Inducible T cell engagers (except NKT cells) of the ‘Maverick’ design.”119 Thus,

on the eve of the transaction, Harpoon appeared to attempt to communicate, however

vaguely, that it viewed the transferred IP as an inducible T cell engager of a specific

design, rather than broad rights to the inducible space. Harpoon never clarified what

it meant by the term “Maverick Design,” and Maverick CSO Gerber and Maverick

116
      JX 1, §§ 1.56, 1.43. “Natural killer T cells” were excluded at Harpoon’s request. JX 1, § 1.43.
117
      JX 550, at 1.
118
Id.
119
      Id.

                                                  23
Board member Geesaman never asked.120 These summaries were not shared directly

with Millennium.

          Harpoon and Maverick entered the ATA on December 30, 2016, and

Millennium and Maverick entered a Collaboration Agreement (the “Collaboration

Agreement”), which provided for funding from Millennium, as well as a Warrant to

Purchase Common Stock of Maverick Therapeutics, Inc. (the “Warrant Agreement”

and together with the ATA and Collaboration Agreement, the “Agreements”), which

provided Millennium with the right to later acquire Maverick.121 Shortly after the

spinout finalized, other large pharmaceutical companies that had expressed interest

in Harpoon—including Merk, Eli Lilly, Pfizer, Johnson & Johnson, and

AZ/MEDI—communicated that they were only interested in the conditionally active

platform.122

          The parties thus entered into these contracts without explicitly having

discussed the limits of the Maverick Field. At trial, each party offered circumstantial

evidence that the other party shared its understanding of the Maverick Field.

120
    Tr. 480:6–481:3 (Geesaman), 1422:6–1423:8 (Gerber). Geesaman had used the term “the
Maverick Technology” in a memo describing the split scFv design, but also described potential
arrangements as being “quite flexible.” JX 593, at 6; Tr. 483:8–486:19 (Geesaman).
121
      Stip., ¶ 23; JX 2; JX 3.
122
    JX 644, at 2 (Merk); JX 740, at 2 (Eli Lilly); JX 758, at 6 (Pfizer), 12 (AZ/MEDI); JX 769, at
4 (Johnson & Johnson); JX 1200, at 2 (Eli Lilly).

                                               24
Harpoon purported to show that Millennium understood the Maverick Field as

limited to the split scFv design:

      • In personal notes, Millennium’s business negotiator Chris Hurff wrote
        that Arendt’s position on the spinoff was that “[Harpoon] can go for
        inducible, just not based on this IP.”123
      • As discussed, Hurff offered alternative negotiating positions, one of
        which was to impose “[s]ome time limit before Harpoon could do any
        T-cell work (3 years?).”124 At this point, a non-compete prohibiting
        Harpoon’s work in the Maverick Field for four years was already in
        place, and so Harpoon infers that if Hurff understood that a three-year
        limitation would go beyond what was already in place, Millennium
        understood the current definition did not include all work on
        conditionally active platforms.125
      • Millennium’s descriptions of the Maverick technology in presentations
        to Takeda match the split scFv concept.126
      • On the date the ATA was signed, Arendt wrote that “version 2” of the
        Maverick technology might be an “entirely new conditional approach
        if approved at [Joint Steering Committee].”127 Under the Collaboration
        Agreement, Joint Steering Committee approval was only required if a
        design was outside the Collaboration Field, which was defined largely
        identical to the Maverick Field, except that it limited the immune
        effector targets to CD3, a specific T cell expression.128 Thus, Harpoon
        infers, Millennium understood that new approaches to inducible T cell
        engagers would fall outside the Maverick Field.
      • WSGR counsel recalled discussions of lab notebook redactions for
        transferring IP to Maverick that he suggested, based on his proposed

123
      JX 426, at 1.
124
      JX 445, at 3.
125
   At trial, Hurff was unable to reconcile these positions and testified that he may have forgotten
about the existing non-compete when he wrote this email. Tr. 357:7–363:22 (Hurff).
126
   See JX 262, at 8–9; JX 583, at 5–7; JX 1017, at 5, 6–7, 17, 25, 29. Essentially, these
presentations describe the ProTriTAC technology as it existed, including the split scFv design.
127
      JX 562, at 1.
128
  JX 2, § 2.1.1(c), § 3.4 (requiring approval if immune effector targets are expanded beyond
CD3).

                                               25
        redactions, indicated the transferred IP was limited to the split scFv
        design in the provisional patent application.129
      • During negotiations, no one at Harpoon explicitly told anyone at
        Millennium that they would not be developing conditionally active T
        cell engagers after the spinout.130

          Conversely, Millennium and Maverick purported to show that they

understood the Maverick Field as encompassing a broad range of inducible T cell

platforms and that Harpoon, though it understood this, never disabused them of the

notion or shared its own intent:

      • Millennium representatives as well as Harpoon employees that joined
        Maverick as of the spinout testified, corroborated by contemporaneous
        notes and correspondence, that they understood the Maverick Field to
        encompass all conditionally active T cell engagers.131
      • New Maverick employees, including CSO Gerber and CEO Jim
        Scibetta testified the reason they joined Maverick was because of the
        exclusive right to work with conditionally active T cell engagers, and
        that they would not have joined the company if they knew its protected
        work was limited to a single design.132
      • Likewise, Millennium representatives testified that the factor justifying
        the planned massive investment in Maverick was their understanding

129
      Tr. 1338:18–1339:5 (Hostetler).
130
    Tr. 287:10–290:24, 307:13–18 (Hurff). Hurff testified at his deposition that Harpoon had
expressly said they would not compete in the inducible space following the spinout, but at trial
testified that he could not recall any specific conversations to that effect. Id.
131
   JX 422, at 20–21 (Gerber’s notes describing spinout as giving “[Takeda] exclusive access to
T[]cell”); JX 583, at 3 (presentation describing spinout as “[o]ption to acquire Inducible T-Cell
Engager company Maverick . . . and the company’s Discovery Platform”); Tr. 1375:3–20, 1381:3–
14, 1384:19–1385:12 (Gerber).
132
   JX 422, at 20–21; Tr. 1375:3–1382:11 (Gerber); JX 370, at 1; JX 366, at 3; Tr. 545:1–547:7
(DuBridge), 885:10–21 (Scibetta), 644:13–645:17 (May). In total, nine Harpoon employees
accepted employment with Maverick as of the spinout. JX 1, at Schedule 1.113. DuBridge, tasked
with separating the companies, testified that he did so based on the understanding that Maverick
would be working in the conditionally active T cell engager field, and Harpoon would not. Tr.
535:7–537:19, 545:20–546:4 (DuBridge).

                                               26
          that the Maverick IP covered the entire conditionally active T cell
          engager platform.133

Although it has designed over 750 different molecules since the spinoff, Maverick

has not researched any designs that do not utilize the split scFv concept.134 Maverick

scientists DuBridge and Arendt both acknowledged that inducible T cell engager

designs exist, including some invented by Harpoon, that fall outside the Maverick

Field and that Harpoon would be free to develop these.135

                        c. Harpoon Avoids Disclosing Plans to Develop Inducible T
                           Cell Engagers After the Spinout

          Prior to the transaction, Harpoon never informed Millennium that it intended

to develop competitive conditionally active T cell therapies following the Maverick

spinout.136 To the contrary, Harpoon emphasized its intent to continue to develop

its inherently active platform.137 In communications with investors regarding its

Series B financing in December 2016, Evnin and Harpoon CEO McMahon stated

that “the Pro-TriTAC platform for conditional activation of T cells in the tumor

microenvironment, has been spun out into sister company Maverick,” and that

133
   JX 426; Tr. 422:4–423:5 (Hurff); JX 451, at 1–4; JX 527-PPT, at 3; Tr. 439:13–24, 442:16–
443:2, 444:12–23, 446:2–447:8, 458:17–459:8, 461:13–18 (Geesaman).
134
      Tr. 518:21–519:1, 588:11–589:10 (DuBridge).
135
Id. at 577:18–578:23, 579:4–10 (DuBridge), 199:11–24 (Arendt).
136
Id. at 247:18–22 (Hurff), 461:13–18 (Geesaman), 547:11–15 (DuBridge), 1401:5–11 (Gerber),
1215:1–8, 1238:8–12, 1258:20–1259:2 (Evnin).
137
Id. at 19:10–20:6 (Arendt), 1226:22–1227:12 (Evnin), 1381:8–17, 1385:4–12 (Gerber).

                                               27
“Harpoon has retained rights for Pro-TriTACs (conditional activation in the tumor)

for the engaging of all other immune cells (except T cells)”; a position that mirrors

Millennium’s current litigation position.138 In an email to Bard Geesaman shortly

before the transaction closed, Evnin described the Maverick Field simply as

“[i]nducible T cell engagers.”139 He stated in an internal email to Baeuerle and

McMahon that due to the non-compete that would be included as part of the

transaction, “the inducible element . . . is off limits.”140

            Around the same time, less than two weeks before the transaction closed,

Evnin and Baeuerle discussed a plan for Harpoon’s future inventions in light of the

non-compete the parties were negotiating.141               Evnin described the spinout to

Baeuerle as being “for cd3 directed inducible antibodies,” and noted Millennium’s

push to expand this definition to all T cell targets.142 He wrote that such a change

would prevent Harpoon from competing “in the space of T cell redirection therapy

with an inducible Maverick like approach (on the IP that is currently filed or on

current know how).”143 Baeuerle responded that it “[w]ould be great to have a CD3

138
   JX 430, at 1; see also JX 438, at 1; JX 456, at 1; JX 558, at 1; JX 590, at 1. Harpoon continued
to use the same language in investor communications immediately after the spinout. JX 623, at 1;
JX 655, at 1.
139
      JX 587, at 1.
140
      JX 630, at 1.
141
      JX 476, at 1–3.
142
      JX 476, at 2.
143
Id.

                                                28
binding domain formed from two pieces defined in the Maverick Field (…because I

have an idea to get to T cell engagers without).”144 Evnin replied, “I think if we

invent something NEW it is not part of this deal. . .”145 Baeuerle confirmed, “[t]hat’s

what I am up to. Perhaps we should invent after the deal is closed.”146 Baeuerle

went on to describe his idea: “It does not depend on bipartite CD3 binder (T’s

[Takeda]’s nightmare).”147 Evnin suggested, “[p]erhaps better for in person at this

point,” and Baeuerle agreed to take the discussion offline.148

            In addition, on October 14, 2016, during due diligence, Harpoon filed a patent

application involving conditionally active technology.149                   Harpoon withheld

disclosure of this patent information from Millennium. Harpoon claimed that

because its disclosure obligations were contained to the Maverick Field, and because

it considered the Maverick Field to be limited to the split scFv design, it was not

obliged to disclose this patent application regarding a conditionally active

144
Id.
145
      JX 474, at 1.
146
Id.
147
      JX 476, at 1.
148
Id. At trial, Baeuerle testified they took the discussion offline not to avoid a paper trail but
because Evnin was physically nearby at MPM Capital’s office and a face-to-face discussion would
be simpler. Tr. 1467:12–22 (Baeuerle).
149
      JX 336.

                                                29
engager.150 Nonetheless, Harpoon withdrew the application for the remainder of the

due diligence period and only refiled it after the Agreements were finalized and the

spinout completed, assuring that Millennium did not see it.151

          Shortly before closing, on December 21, 2016, Evnin reminded others that “in

the context of a [joint] release with Takeda we do not want to [be] raising their ire

about other technologies currently at Harpoon (that they do not know about now).”152

Evnin testified that he wanted to avoid reopening negotiations, particularly around

the Maverick Field definition.153 Maverick’s soon-to-be CSO, Gerber, was included

on this email.154

                        d. The Parties Finalize the Agreements

          Harpoon spun off Maverick at the end of December 2016.155 On December

30, Harpoon and Maverick entered into the ATA, which governed the spinout.156 A

week later, Maverick and Millennium entered into the Collaboration Agreement,

which provided for funding from Millennium, as well as the Warrant Agreement,

150
    Compare JX 405, at 27 (requiring disclosure of all intellectual property) with JX 433, at 30
(requiring disclosure of intellectual property “relating to the Maverick Field”); Tr. 1163:23–
1165:25 (Evnin).
151
  See JX 904, at 3; Tr. 1231:12–1233:2 (Evnin); Guenot Depo Tr. 25:23–26:14, 29:1–18; 215:14–
216:8.
152
      JX 500, at 1.
153
      Tr. 1180:3–1182:16 (Evnin).
154
      JX 500, at 1.
155
      Stip., ¶ 35.
156
Id. ¶ 23; JX 1.

                                              30
which provided Millennium with the right to later acquire Maverick.157 While

Millennium planned to invest substantially in Maverick, it was not a party to the

ATA.158 However, as noted, Harpoon sought Millennium’s approval of the final

ATA, and Harpoon had communicated with Millennium regarding the terms of all

three Agreements.159

            Under the terms of the ATA, Maverick provided Harpoon with a $6.75 million

promissory note, payable in two years.160 Maverick transferred 4,086,720 shares of

common stock and 15,000,000 shares of Series A Preferred Stock to Harpoon, which

Harpoon disbursed pro rata to its shareholders.161 Also upon Maverick’s spinout,

Harpoon employees, including DuBridge, accepted employment with Maverick.162

Evnin became the chair of the Maverick Board, Baeuerle became an observer of the

Maverick Board, and both of them joined the “Takeda-Maverick Joint Steering

Committee.”163 At the same time, both Evnin and Baeuerle continued to serve on

157
      Stip., ¶ 23; JX 2; JX 3.
158
      Stip., ¶¶ 29–30.
159
   Tr. 237:13–20 (Hurff), 714:22–715:9 (Hiett); 1189:22–1191:4, 1199:8–17, 1256:20–1257:18
(Evnin), 1340:16–1341:10 (Hostetler).
160
      Stip., ¶ 38. Harpoon has repaid this note. Id.
161
      Id.
162
Id. ¶ 39.
163
Id. ¶ 40.

                                                  31
the Harpoon Board.164 Millennium recognized at least Baeuerle’s dual service as a

potential risk.165

          After the spinout, Maverick renamed the ProTriTAC platform the COBRA

platform.166

                           e. Harpoon’s Non-Compete

          Under § 7.5 of the ATA, Harpoon agreed that it would not compete with

Maverick in the Maverick Field for four years.167 This meant that Maverick had the

exclusive right for four years to research, develop, manufacture, and commercialize

any product in the Maverick Field.168 The finalized ATA defines the Maverick Field

in § 1.56:

          “Maverick Field” means multi-specific Antigen-binding molecules that
          include: (a) at least one domain that binds to an Immune Effector Target
          that (i) is formed from two domains, each of which is impaired for
          Immune Effector Target binding, and (ii) undergoes a resultant increase
          in Immune Effector Target binding affinity of at least 50 fold after an
          activation event; (b) at least one domain that binds to one or more

164
Id. ¶ 41.
165
      See JX 583, at 19.
166
      Stip., ¶ 39. COBRA stands for Conditional Bispecific Redirected Activation.
167
   JX 1, § 7.5 (Harpoon agreeing that it would not “anywhere in the word, directly or indirectly,
engage in the Business [of researching, developing, manufacturing or commercializing any
product within the Maverick Field] in any manner . . . until four (4) years after the Distribution [of
Maverick stock to Harpoon]” and that the noncompete was “reasonable and properly required for
the adequate protection of Maverick’s interest in the [business of researching, developing,
manufacturing or commercializing any product within the Maverick Field].”).
168
      Stip., ¶ 31.

                                                 32
          Therapeutic Targets; and (c) at least one half-life extension domain,
          which domains (a) through (c) may be linked in various orders.169

The term “Immune Effector Target” is further defined in ATA § 1.43 as “a Target

that is expressed by a T cell and induces a therapeutic cytolytic T cell response upon

binding, provided that natural killer T cells shall not be considered T cells for the

purposes of this definition.”170

          Plaintiffs testified that at the time the parties entered the ATA, the Maverick

Field definition above encompassed all then-existing conditionally active T cell

engagers.171 Additionally, Plaintiffs testified that the Maverick Field was broad

enough to encompass several approaches to conditionally active T cell engagers

being used by other competitors then in the market.172

          Various assets related to the Maverick field, including contracts, tangible

assets, permits, books and records, claims, and a number of employees, were also

transferred to Maverick under the ATA.173 Following the transfer of the intellectual

169
      JX 1, § 1.56.
170
   JX 1, § 1.43. Harpoon requested a carve-out of “Natural Killer T Cells” from the definition to
develop a different technology not at issue in this litigation. Stip., ¶ 27. The carve-out was narrow
and did not affect Maverick’s work. Tr. 267:12–268:23, 269:23–270:10 (Hurff).
171
   Tr. 209:21–210:1, 213:13–20 (Arendt), 551:24–554:1, 548:16–549:22, 556:20–557:3, 608:20-
609:6 (DuBridge).
172
   This included molecules designed by CytomX, Amunix, and Genetech. Tr. 69:17–24, 209:21–
210:1, 213:13–20 (Arendt), 551:24–554:1, 548:16–549:22, 556:20–557:3, 608:20–609:6
(DuBridge).
173
      JX 1, §§ 2.1(b)–(f), 4.1, Schedule 1.113.

                                                  33
property in the ATA, Maverick gave Harpoon the Grant-Back License to use the

intellectual property “outside the Maverick Field.”174

                     4. After the Spinout, Harpoon Develops a New Conditionally Active
                     T Cell Engager

          Following the Maverick spinout, Harpoon began generating ideas for a new

conditionally active T cell therapy as early as January 2017.175 Harpoon CEO

McMahon testified that the search for a conditionally active platform that did not

use the split scFv design began immediately after the spinout.176 Baeuerle described

Harpoon’s early concepts, some of which he had begun developing before the

spinout, as “science fiction” designs.177 In March 2017, McMahon prepared a

presentation for an investor that stated Harpoon was “unencumbered . . . to develop

new protease-dependent activation of T and other immune cells.”178              Another

presentation in June included the same language.179

174
      JX 1, § 2.2(b)–(c).
175
      Stip., ¶ 42.
176
      Tr. 1682:16–22 (McMahon).
177
      JX 537, at 1; Tr. 1464:1–11 (Baeuerle).
178
      JX 646, at 12.
179
      JX 690, at 27.

                                                34
                         a. Harpoon Continues to Avoid Disclosing its Work on
                            Conditionally Active T Cell Engagers to Maverick or
                            Millennium

            However, in public statements after the spinout, Harpoon described the

companies in a way that conformed to Millennium’s understanding of a broad

Maverick Field. In preparation for a Series B financing press release in May 2017,

Harpoon’s public relations consultant proposed text that stated Harpoon was

“developing research platforms targeting [t-cells?] that become activated by

proteases in the tumor micro-environment.”180 McMahon responded, “[d]o not say

T cells – that is Maverick and Takeda would sue us.”181

            In a public comment for a Biocentury article on the spinout in June 2017,

Evnin stated:

            In this particular case, [the spinout] made a lot of sense because we had
            somebody interested in a piece of the Harpoon portfolio of
            technologies, and they were willing to put a huge amount of money
            exclusively behind that one piece to make it the corner of the IP estate.
            [Harpoon and Maverick] obviously have a shared history, but these two
            companies now have their own distinct trajectory.182

Harpoon’s head of business development emailed McMahon regarding Evnin’s

statement: “This is a great article..[.] although it seems to imply that Maverick got

rights to all related conditionally-active TriTAC which I don’t think is accurate. I’m

180
      JX 681, at 1.
181
Id.
182
      JX 748, at 2.

                                               35
sure Maverick doesn’t know that but it is misleading...”183 In the same article,

McMahon stated, “[w]e’ve carefully, strategically carved the Maverick platform out

of Harpoon and it really is not competing. This was a self-contained technology and

was therefore relatively new and easy to bring into a separate business.”184

          In February 2018, Harpoon solicited Takeda—Millennium’s parent

company—for investment in its inherently active technologies.185               Harpoon

modified the slide deck for its presentation to avoid disclosing its work on

conditionally active T cell engagers.186 McMahon instructed Harpoon’s head of

business development to remove all references to the development of “Pro”—i.e.

inducible—technologies from an existing investor slide deck for the purpose of

sending it to Takeda.187 At trial, he testified that he did not want to reveal Harpoon’s

ProTriTAC research at that time because it would be competitive with Maverick,

which Takeda was funding through Millennium.188 Evnin commented in the email

chain, “[p]lease recall that Takeda is the Maverick partner . . . . they would not be

excited to hear about some of [Harpoon’s] work . . . . e.g. on T cell engagers.”189

183
      JX 749, at 1.
184
      JX 748, at 2.
185
      JX 808.
186
      See JX 808; Tr. 1277:12–1278:2 (Evnin).
187
      JX 808, at 1.
188
      Tr. 1667:2–23, 1668:8–1669:4 (McMahon).
189
      JX 814, at 1.

                                                36
And Baeuerle wrote, “Takeda will be super sensitive re conditional triTACs. And I

will get under scrutiny . . .”190 McMahon replied, “which is why we removed any

reference to Pro-Tritac in the slides.”191

                        b. Harpoon Maintains Access to Maverick’s Confidential
                        Information

            Following the Maverick spinout, both Evnin and Baeuerle had extensive

access to Maverick’s research at the same time that Harpoon was developing

competing technology.192           Evnin and Baeuerle participated in Maverick board

meetings, joint steering committee meetings, and scientific advisory board

meetings.193 Baeuerle worked as an “acting CSO” at Maverick, and Evnin also

worked intimately with the scientists at Maverick to develop Maverick’s COBRA

molecule.194 Millennium witnesses testified that the company only granted this level

of access based on the understanding that Harpoon was limiting its own work to

inherently active platforms.195 While Evnin recognized that with the development

of a new conditionally active platform, Harpoon was working as a direct competitor

190
Id.
191
      Id.
192
      Tr. 1273:11–1274:4, 1277:12–1278:2 (Evnin), 1558:16–1559:14 (Baeuerle).
193
Id. at 549:8–15, 562:15–563:3, 564:4–566:21 (DuBridge), 893:8–894:14 (Scibetta), 653:13–
654:3, 664:10–22, 670:16–672:15 (May).
194
Id. at 1495:10–15, 1469:6–1471:1, 1558:16–1559:14 (Baeuerle).
195
Id. at 417:23–418:8, 419:9–14 (Hurff), 74:2–19 (Arendt).

                                                37
of Maverick, he did not disclose this fact to Maverick or Millennium.196 Baeuerle

and Evnin testified that they refrained from disclosing the competition due to their

confidentiality obligations to Harpoon.197 Likewise, other members of the Maverick

Board, including Geesaman, knew of Harpoon’s conditional platform and did not

disclose it to Maverick for the same reason.198

          Baeuerle testified that his practice was to “firewall” the intellectual property

of each company he started to prevent it from influencing his work at subsequent

companies; similarly, here, he testified he prevented what he learned in his work at

Maverick from influencing his work at Harpoon.199 Both Evnin and Baeuerle

testified that they were not involved in the development of any conditionally active

platforms at Harpoon, though Baeuerle’s name would appear on slides and draft

patent applications associated with the ProTriTAC technology, and Evnin would

request to be listed as an inventor.200 Further, in May 2017, Evnin sent an email to

McMahon at Harpoon containing slides from a Maverick board meeting regarding

196
Id. at 1174:20–24, 1175:15–20 (Evnin), 899:8–23 (Scibetta). Evnin conceded he would not
allow someone working for a competitor to serve on Harpoon’s Board due to the potential conflicts
of interest. Id. at 1267:12–1269:17 (Evnin).
197
Id. at 1516:23–1517:5 (Baeuerle).
Id. at 488:1–10 (Geesaman). Dr. Dan Hicklin also served on both Maverick’s and Harpoon’s
198

Boards and did not disclose Harpoon’s ProTriTAC molecule. Id. at 940:19–941:18 (Scibetta).
199
Id. at 1495:7–14, 1556:14–22 (Baeuerle).
200
   JX 718 (slide deck bearing Baeuerle’s name); JX 730 (email chain discussing inventor-ship of
patent application); JX 791 (email noting Evnin’s request to be listed as inventor); Tr. 1278:3–19
(Evnin), 1559:15–24 (Baeuerle).

                                                 38
its conditionally active platform and wrote, “[s]ee these slides in case this sparks

something.”201        Evnin described this at trial as an “inadvertent” disclosure of

Maverick’s confidential information, testifying that he had not intended to send the

full contents of the email thread, but only a smaller portion that did not contain

confidential information.202

                        c. Harpoon Invents a New ProTriTAC Molecule

          On June 1, 2017, Harpoon hired Dr. Jack Lin, in part to help develop

conditionally active therapies.203         Lin came to Harpoon with experience with

antibodies, proteases, and “peptide masking,” a technique with the potential to make

protease-activated inducible therapies.204 However, Lin had no direct experience

with T cell engager technologies.205 Lin’s mandate at Harpoon was to develop an

inducible platform without using the split scFv design.206 He would be aided in this

endeavor, he was told, by existing concepts and ideas already at Harpoon relating to

inducible platforms.207 Upon arrival, Lin checked to see if he was “allowed to talk

freely with [Baeuerle] on everything we do on the inducible formats” because of “his

201
      JX 669, at 1.
202
      Tr. 1299:14–20, 1305:5–1306:4 (Evnin).
203
      Stip., ¶ 43.
204
      Tr. 1721:18–1725:19, 1726:3–1727:14 (Lin).
205
Id. at 1727:7–14, 1797:22–1798:5 (Lin).
206
Id. at 1732:24–1733:14 (Lin).
207
Id. at 1799:17–1800:2, 1802:20–1803:1 (Lin).

                                                39
affiliation with Maverick.”208 Lin’s supervisor, Dr. Holger Wesche, told him, “feel

free to talk with [Baeuerle] about anything.”209

            Lin testified that within two weeks of employment at Harpoon, he had a

scientific epiphany—a “serendipitous eureka moment.”210              By incorporating a

peptide mask into part of the albumin binding domain (the third binding domain of

the TriTAC molecule), he could achieve conditional activity.211 He showed this to

colleagues almost immediately, which included two meetings with Baeuerle on July

17 and 18 to discuss his concept.212 Baeuerle testified at trial that at the second of

these meetings, he made a “tiny modification” of Lin’s whiteboard drawings of the

concept.213 After the meetings, Baeuerle prepared a slide deck outlining these

concepts and naming the molecules depicted in the slides “Novel ProTriTAC

Designs.”214 This slide deck by Baeuerle was the first instantiation what became a

key change from Lin’s original insight in any Harpoon materials—that change being

to mask the CD3 (i.e. the T cell) binding domain, rather than the tumor target

208
      JX 713, at 1.
209
Id.
210
      Tr. 1745:4–15, 1800:3–12 (Lin).
211
Id. at 1737:8–1740:10 (Lin).
212
Id. at 1544:4–1545:8 (Baeuerle).
213
Id. at 1543:4–1544:3 (Baeuerle).
  JX 717, at 2. The name is admittedly easy to confuse with Harpoon’s prior ProTriTAC, which
214

was transferred to Maverick and subsequently renamed COBRA. Going forward in this
Memorandum Opinion, “ProTriTAC” refers to Harpoon’s conditionally active molecule, and
“COBRA” refers to Maverick’s conditionally active molecule.

                                            40
domain, as Lin had originally conceived it.215 Baeuerle emailed these slides to Lin

and told him that he should “[f]eel free to modify and to take ownership for the

slides.”216

          As noted previously, Baeuerle testified that he was uninvolved in the

invention or development of Harpoon’s ProTriTAC, and that he included his name

on the slides only because he had created the graphics—not the ideas.217 According

to his testimony, he contained his work at Harpoon entirely to inherently active

technologies, and he never approached the ProTriTAC project except for this one

interaction with Lin.218             Baeuerle and Evnin later emailed each other about

Harpoon’s new ProTriTAC design without including Lin on the correspondence or

mentioning his role as designer.219 At trial, Lin testified that his supervisor, Dr.

Holger Wesche, suggested the key change from his original idea—moving masking

from the tumor to the T cell domain—which, once incorporated into the design,

formed the core structure for Harpoon’s new ProTriTAC molecule.220 Lin suggested

215
      Tr. 1818:9–16 (Lin).
216
      JX 717, at 1.
217
    Tr. 1477:16–20. As Baeuerle noted and the slide deck shows, Lin’s name is listed first and in
a larger, bolded font, which Baeuerle testified indicated the concepts were Lin’s. Tr. 1478:4–10
(Baeuerle).
218
Id. at 1472:8–22 (Baeuerle).
219
      JX 730, at 2.
220
   Tr. 1745:22–1746:13, 1749:8–1750:2 (Lin). Lin’s testimony at his deposition was somewhat
inconsistent. Lin testified that Wesche’s role, “[i]f any,” was “not significant.” Lin Dep. Tr.
167:5–15. However, at other points in his deposition, he identified Wesche as the one who
                                                41
Wesche was identified as an author on the subsequent slide deck because he was

Lin’s supervisor.221

                        d. Harpoon’s New ProTriTAC Molecule

          Harpoon’s ProTriTAC molecule is a conditionally active T cell therapy

platform.222 It is a multi-specific antigen-binding molecule because it binds to: (1)

a tumor antigen; (2) CD3 epsilon, which is an Immune Effector Target expressed on

T cells, and (3) albumin.223 In other words, the Harpoon ProTriTAC is “functionally

similar” and utilizes the same “building blocks” as Maverick’s COBRA molecule,

except for the way that it activates.224

          As described previously, the CD3 binding site is a specific type of T cell

binding site, the part of the molecule that recruits T cells. The CD3 binding site is

made of a scFv, which in turn is made of a vL chain and a vH chain.225 Maverick’s

COBRA molecule prevents the scFv from recruiting T cells by keeping the two parts

of the scFv separated until the molecule is in the tumor microenvironment.226 Once

suggested the change in masking, consistent with his trial testimony. Lin Dep. Tr. 135:6–19,
136:8–137:18, 142:13–20.
221
      Lin Dep. Tr. 166:10-17.
222
      Stip., ¶ 49.
223
Id. ¶ 50.
224
   Tr. 1558:4–15 (Baeuerle), 571:22–572:6, 572:18–573:7 (DuBridge); JX 970, at 1 (email from
Scibetta to Baeuerle noting similarities of molecules); JX 987 (notes from DuBridge regarding
conversation with Baeuerle about similarities of molecules).
225
      Tr. 1725:2–11, 1740:11–1741:20 (Lin).
226
Id. at 589:1–5 (DuBridge).

                                              42
there, the separators fall away, and the scFv comes together, creating an active T cell

binding site.227 By contrast, in Harpoon’s new ProTriTAC molecule, the scFv

remains together at all times.228 But it is covered by a peptide mask that prevents it

from recruiting T cells.229 In the tumor microenvironment, when the peptide mask

is removed, the T cell binding site, already fully formed behind the mask, is fully

freed to recruit T cells.230

            Harpoon’s ProTriTAC is also different as it relates to binding affinity.

Because the scFv remains together, the immune effector target site (i.e. the scFv)

maintains the potential to bind to T cells, and thus it has binding affinity.231

However, because the peptide mask imitates the binding site on the T cell (and

because the peptide mask is always nearby on the molecule), the scFv’s binding

affinity causes it to attach to the peptide mask rather than to T cells.232 Thus, as long

227
Id.
228
      Id. at 1737:8–18 (Lin).
229
Id. at 1736:19–1737:2, 1737:19–1738:2, 1739:18–1740:2 (Lin), 798:9–12 (Landes), 871:1–13
(Marasco). As the witnesses explained, this peptide mask is a “decoy” located on a different part
of the ProTriTAC molecule, and so the molecule tends to bind to it, thus preventing T cell
recruitment, but the molecule is not always bound to the peptide mask, and so some of the time it
has the potential to recruit T cells despite not being in the tumor microenvironment. Id. at
1736:19–1737:2, 1737:19–1738:2, 1739:18–1740:2 (Lin).
230
Id. at 800:3–14, 800:23–801:8 (Landes).
231
Id. at 1930:20–1931:23 (Tidor) (discussing test that isolates the binding affinity of the immune
effector target site and demonstrates it maintains binding affinity).
232
Id. at 1733:14–1738:2 (Lin).

                                                43
as the peptide mask inhibits the immune effector target’s ability to bind to T cells,

the ProTriTAC molecule as a whole will not bind to T cells.233

            This is a graphic representation of Harpoon’s new ProTriTAC molecule:

                                                                       234

233
Id.
234
      JX 785.

                                            44
                      e. The Building Blocks of Harpoon’s ProTriTAC Molecule and
                         Maverick’s COBRA Molecule

       Harpoon developed its new ProTriTAC molecule at a speed that Baeuerle

testified surprised him, and which struck Maverick as evidence that Harpoon was

using pre-validated research.235 The companies’ comparative costs reflected the

speed of development: in total, Harpoon spent around $9.1 million to develop its

ProTriTAC molecule, compared to Maverick’s $40 million expenditure to develop

its COBRA molecule.236

       Conditionally active T cell engagers rely on several components, and each

component, like the therapy drug itself, requires effort and expenditure to develop.

Maverick estimates it has spent 150,000 hours of research in developing the COBRA

molecule, including working over a year on the research necessary to select the

individual components.237         Building a conditionally active molecule requires

selecting and developing, among others, four aspects: (1) tumor target selection, (2)

proteases and protease cleavable linker selection, (3) combinations of these tumor

235
   Tr. 1552:21–1553:8 (Baeuerle) (testifying he was surprised at how quickly Lin was able to
develop the ProTriTAC molecule), 788:9–789:5 (Landes) (testifying ProTriTAC’s development
exceeded ordinary speeds).
236
Id. at 1759:20–1760:6 (Lin) (testifying that Harpoon’s total research expenditures to date for
ProTriTAC are around $9.1 million), 897:13-20 (Scibetta) (testifying that Maverick has spent
around $40 million to date).
237
Id. at 563:23–564:3 (DuBridge), 656:14–23, 659:13–17, 660:22–661:8 (May), 897:3–12
(Scibetta).

                                               45
targets and proteases; and (4) tumor cell lines.238              Research regarding these

component parts, like development of the technology as a whole, is highly

confidential.239 Both Maverick’s COBRA molecule and Harpoon’s ProTriTAC

molecule utilize identical component parts for the above aspects of their

molecules.240 The similarity is close enough that a Maverick witness thought graphic

presentations of the two molecules might be confused for each other.241

          EGFR is a tumor antigen target with properties that make it a strong candidate

for conditionally active therapies.242 EpCAM is another tumor antigen target with

properties that also make it a candidate for conditionally active therapies.243

Maverick estimated it spent 24,000 hours of research determining that EGFR and

EpCAM would be effective targets in combination with the protease MMP9.244

MMP9 is a tumor-associated protease that is used in T cell therapy because it is most

often found in tumor microenvironments.245                  Selecting MMP9 from the 569

238
Id. at 563:4–22, 564:4–565:12 (DuBridge), 780:16–781:20 (Landes).
239
Id. at 650:12–651:1 (May). Maverick takes protective measures in its business practices to
maintain this confidentiality, including confidentiality agreements, employee restrictions, and
physical security measures. See JX 923; JX 687; JX 789; JX 1090.
240
      Tr. 1768:19–1769:24, 1773:11–1774:6, 1780:21–1781:7 (Lin), 571:22–573:7 (DuBridge).
241
Id. at 570:22–571:15 (DuBridge).
242
Id. at 1768:19–1769:24 (Lin).
243
Id. at 1774:1–1776:13 (Lin).
244
Id. at 649:6–650:11, 656:14–23, 660:22–661:8 (May).
245
Id. at 1748:11–17, 1781:20–1783:15 (Lin).

                                                  46
proteases in the human body required an estimated 12,000 hours of research from

Maverick.246       HCT-116 is a cell line for human colorectal cancer, called a

“xenograph model.”247 Like the other components, it requires research to determine

that it is an optimal cell line with relation to EGFR and EpCAM.248

         Maverick considers its work on these components and their combinations to

be trade secrets.249 Maverick’s research could provide a roadmap to construct a

viable therapy; however, various instances and combinations of EGFR, EpCAM,

MMP9, and HCT-116 have been seen previously in available literature and used for

the development of immunotherapies.250 Amunix, an immunotherapy competitor,

had contemplated these four components in combination in a publicly disclosed

246
    JX 432, at 13 (identifying 569 proteases in the human body); Tr. 658:22–659:17 (May)
(testifying the selection of MMP9 required 12,000 hours of research).
247
      Tr. 707:12–709:13 (May).
248
   See JX 651, at ¶ 452 (identifying possibility of combining EpCAM and HCT-116); JX 1076, at
¶ 109 (identifying HCT-116 as one of “[t]housands” of potential cell lines); Tr. 662:14–663:18
(May) (testifying regarding research required to select cell line).
249
   Tr. 648:6–11, 657:10–659:12, 660:2–11, 661:9–662:7, 662:14–663:18 (May), 779:12–780:2,
780:16–781:20 (Landes).
250
    E.g. JX 69 (article exploring EGFR); JX 79 (same); JX 90 (article exploring cell lines); JX 113
(article exploring application of MMP9); JX 580 (CytomX proof-of-concept poster identifying
EGFR as tumor target); JX 651 (patent application identifying EGFR and EpCAM as tumor
targets); JX 660 (Amunix proof-of-concept poster identifying EpCAM as tumor target); JX 738
(patent application identifying EGFR, EpCAM, and MMP9 as tumor targets and protease); Tr.
705:5–707:7 (May), 1790:17–1791:1 (Lin). The Plaintiffs seek to exclude all scholarly articles
offered by Harpoon as inadmissible hearsay, but I find that Harpoon is not relying on these
scholarly articles for the truth of the matter asserted but rather for the fact of their publication, i.e.,
to prove that certain scientific knowledge was publicly available. See Freeman v. Minnesota Min.
& Mfg. Co., 675 F. Supp. 877, 884 n.5 (D. Del. 1987).

                                                   47
patent application in March 2017.251                However, even this patent application

contemplates several possible proteases in combination with EpCAM—in other

words, it did not isolate these four as Maverick’s COBRA molecule did.252

          Harpoon offered additional evidence showing it possessed knowledge of each

component as a possible tumor target, protease, or cell line from publicly available

sources or past experience:

      • Prior to working at Harpoon, Lin had worked on therapeutics that
        targeted EGFR and encountered studies suggesting it could be used as
        a tumor target, and at Harpoon he had access to data that pushed him
        toward its use.253 Harpoon had conducted prior research in 2016
        contemplating EGFR as a tumor target.254
      • Amunix identified EpCAM as a tumor target by March 2017, although
        it was one of many potential targets.255 Harpoon had contemplated
        EpCAM as a possible tumor target—among several options—in a prior
        patent application, and it conducted its own research on EpCAM in
        2018.256
      • Other companies published the use of MMP9 as a protease in
        conditionally active T cell therapies.257 Maverick disclosed its use of

251
      JX 651; see also Tr. 1790:17–1791:1 (Lin).
252
      Tr. 705:5–707:7 (May).
253
   Tr. 1769:12–24, 1770:5–1771:9 (Lin); see also JX 118 (CytomX poster showing EGFR as
tumor target).
254
   JX 435, at 10 (2016 Harpoon presentation identifying EGFR as tumor target); Tr. 1769:19–24,
1771:10–24 (Lin). Maverick also disclosed EGFR as a representative tumor target in its patent
application for COBRA. JX 738, at ¶ 17.
255
      JX 651; JX 660; Tr. 705:5–706:12 (May).
256
    JX 133, at 53 (Harpoon patent application identifying EpCAM among seven possible target
antigens); JX 774, at 6 (Harpoon order form purchasing “EPCAM protein” for laboratory
research); Tr. 1776:9–13 (Lin) (testifying that Harpoon conducted research regarding EpCAM
binders in January 2018).
257
  JX 178, at 90–91 (2016 CytomX patent application identifying MMP9 as possible protease
among large field of possibilities); Tr. 705:5–706:12 (May) (acknowledging Amunix disclosed
                                                   48
        MMP9 in a patent application in September 2017.258 Harpoon
        conducted independent research to develop “protease-cleavable linker
        sequences,” and it did not utilize the same sequences as Maverick.259
      • HCT-116 has been used as a cell line in T cell engager research since
        2010.260 Harpoon conducted research with HCT-116 in 2016 prior to
        the spinout.261 Additionally, other companies had publicly disclosed
        the use of HCT-116 for testing conditional T cell engagers.262

The usefulness of these components depends not only on the identification but also

the combination in the T cell engager. Combinations of EGFR, EpCAM, MMP9,

and HCT-116 have also appeared in public literature as useful for the development

of immunotherapies, though this literature typically presented a field of possible

options, rather than the exact combination Maverick—and later Harpoon—utilized

MMP9 as possible protease in 2017); Tr. 1782:12–1783:10 (Lin) (testifying that both CytomX and
Amunix provided evidence of the opportunity to use MMP9 as protease).
258
   JX 133, at 50 (March 2017 Maverick patent application disclosing MMP9 as one of a field of
possible proteases); JX 738, at ¶¶ 358, 126 (September 2017 Maverick patent application
disclosing “[t]he protease MMP9” as being “known to be overexpressed in tumor cells” and thus
a selected protease); Tr. 602:6–13 (DuBridge) (acknowledging disclosure of MMP9 as one of
many possible proteases).
259
   Tr. 1784:13–1785:15 (Lin) (testifying regarding independent experiments), JX 1076, at 43
(Ploegh’s expert report comparing Maverick and Harpoon’s linker sequences cleavable by MMP9
and concluding they are distinct).
260
    Tr. 707:12–709:13 (May) (acknowledging HCT-116’s use known as early as 2010 and in
connection with MMP9 by 2016), 1788:10–1789:18 (Lin) (testifying regarding available studies
on HCT-116’s use as cell line with relation to both EGFR and EpCAM); JX 48 (2004 paper on
HCT-116); JX 79 (2010 paper addressing use of HCT-116 as cell line in T cell-engaging
antibodies); JX 90 (2012 paper addressing use of HCT-116 in antibody targeting); JX 113 (2015
paper studying use of HCT-116 as cell line in relation to MMP9).
  JX 153, at 1 (email from Guenot explaining that “[t]he reason for picking HCT116 is that this
261

model worked well for the EGFR”); Tr. 606:13–23 (DuBridge).
262
   JX 580 (CytomX poster utilizing HCT-116 as cell line in T cell engager); JX 651, at 32 (Amunix
patent application disclosing HCT-116 with regard to T cell engager).

                                               49
in their molecules.263 Harpoon researched some combinations prior to Maverick’s

spinout.264 However, it conducted no research regarding the specific combination

of these four components—EGFR, EpCAM, MMP9, and HCT-116—prior to

selecting them as components for its new ProTriTAC molecule.265

                             f. Harpoon Announces the New ProTriTAC and Maverick Sues

          Harpoon informed Maverick of its newly-developed conditionally active

technology a few days before publicly announcing the platform at the annual

meeting of the Society for Immunotherapy of Cancer (“SITC”) in Washington, D.C

on November 9, 2018.266 Baeuerle called Maverick CEO Jim Scibetta on November

6 and told him that Harpoon was developing a conditionally active T cell engager.267

Scibetta then spoke with Evnin, who confirmed that Harpoon was in fact a

competitor with Maverick.268 At the SITC conference, Harpoon announced its new

molecule, ProTriTAC, and offered proof-of-concept data (the “SITC Poster”).269

Two days later, on November 11, Harpoon announced the closing of its $70 million

263
   E.g. Tr. 602:6–13 (DuBridge), 705:5–707:7 (May), 1790:17–1791:1 (Lin); JX 69; JX 79; JX
90; JX 113; JX 580; JX 651; JX 660; JX 738.
264
   Tr. 603:4–14, 604:12–17, 606:13–23 (DuBridge); JX 133, at 50, 53 (Harpoon patent application
contemplating possible component combinations as of March 2016).
265
      Tr. 787:10–788:8 (Landes), 1833:14–1835:13 (Lin).
266
      Stip., ¶¶ 44–45.
267
      Tr. 897:23–898:13 (Scibetta).
268
Id. at 899:8–23 (Scibetta).
269
      Stip., ¶ 45; JX 785.

                                               50
Series C financing round, part of which would be used to develop its ProTriTAC

platform.270

          Over the next week, Scibetta had several meetings and phone calls with

Harpoon. On November 12, Scibetta told Evnin that he should remove himself from

the Maverick Board, and Evnin agreed.271 Evnin told Scibetta that if Takeda wished

to redo the deal, given the new competitive landscape, this was an option.272 Scibetta

then met with McMahon and learned that the ProTriTAC had been in development

for eighteen months, ever since the spinout.273 In further communications, Evnin

acknowledged again that Harpoon and Maverick were competitors and noted,

regarding their disagreement over whether the new ProTriTAC fell within the

Maverick Field, that it was “too bad the Takeda lawyers missed that in drafting.”274

In a follow-up email on November 15, Evnin reiterated a willingness to revisit the

deal with Takeda and Millennium based on Harpoon’s new invention “if Takeda

wants to get out of the Agreement.”275

270
      Stip., ¶ 48.
271
   Tr. 909:14–910:10 (Scibetta). Evnin would ultimately resign a few weeks later, around
Thanksgiving. Tr. 912:23–913:6 (Scibetta).
272
Id. at 910:11–19 (Scibetta).
273
Id. at 914:20–915:13 (Scibetta).
274
Id. at 916:18–917:24, 956:1–24 (Scibetta); JX 983.
275
      JX 984, at 1.

                                                 51
          C. Procedural History

          Maverick filed its complaint and a motion for a temporary restraining order

(“TRO”) on January 3, 2019.276 I heard argument regarding the TRO on January 18,

2019 and denied the motion.277              On April 30, Millennium filed a Motion to

Intervene.278 I granted the Motion to Intervene on May 8, and Millennium filed its

complaint on May 14.279 Discovery motion practice and disputes followed, and I

issued a Letter Opinion resolving some of them on August 9, 2019.280 A six-day

trial took place September 9 – September 13, and September 17, 2019. I heard post-

trial argument on December 17, 2019, and I considered the matter fully submitted at

that time.281

                                         II. ANALYSIS

          Maverick filed claims against Harpoon for breach of contract and

misappropriation of trade secrets. Millennium filed claims against Harpoon for

fraud, tortious interference with business relations and with contract, unfair

276
   Verified Compl. for Inj. Relief for Breach of Contract and Misappropriation of Trade Secrets,
D.I. 1; Pl.’s Mot. for Temporary Restraining Order, D.I. 1.
277
      Oral Argument on Mot. for TRO before V.C. Glasscock on 1.18.2019, D.I. 26.
278
      Mot. to Intervene, D.I. 110.
  Telephonic Oral Argument and Rulings of the Court on Millennium Pharmaceuticals, Inc.’s
279

Mot. to Intervene, D.I. 147; Verified Compl. in Intervention, D.I. 135.
280
    Maverick Therapeutics, Inc. v. Harpoon Therapeutics, Inc., 2019 WL 3763953 (Del. Ch. Aug.
9, 2019).
281
      Post-Trial Oral Argument Transcript, D.I. 351.

                                                 52
competition, and unjust enrichment. Although the parties offered some expert

testimony regarding damages, I specified at trial that this initial Opinion would

address issues of liability only—assuming damages—and that I contemplated a

further damages stage contingent on my findings here.282

         A. Maverick’s Claims

                1. Breach of Contract

         A breach of contract requires (1) a contractual obligation, (2) a breach of that

obligation, and (3) resulting damages.283              “When the contract is clear and

unambiguous,” this Court will “give effect to the plain meaning of the contract’s

terms and provisions.”284         Plain meaning is often elucidated with help from

dictionaries.285 By contrast, “when contractual language in issue is reasonably

susceptible to more than one meaning . . . extrinsic evidence will be considered to

resolve the ambiguity.”286 However, “[c]ontract terms are not ambiguous merely

282
      Tr. 1980:12–1981:7.
283
   Interim Healthcare, Inc. v. Spherion Corp., 884 A.2d 513, 548 (Del. Super. 2005), aff’d, 886
A.2d 1278 (Del. 2005).
284
  Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153, 1159–60 (Del. 2010) (citing Rhone–Poulenc
Basic Chem. Co. v. Am. Motorists Ins. Co., 616 A.2d 1192, 1195 (Del. 1992)).
285
    Lorillard Tobacco Co. v. Am. Legacy Found., 903 A.2d 728, 738 (Del. 2006) (“Under well-
settled case law, Delaware courts look to dictionaries for assistance in determining the plain
meaning of terms which are not defined in a contract.” (citing Nw. Nat’l Ins. Co. v. Esmark, Inc.,
672 A.2d 41, 44 (Del. 1996))).
286
   Supermex Trading Co., Ltd. v. Strategic Sols. Grp., Inc., 1998 WL 229530, at *3 (Del. Ch. May
1, 1998).

                                               53
because the parties to the contract disagree” about the meaning.287 As explained

below, I find the contract language of the Maverick Field definition unambiguous,

and so the contractual language is itself “the binding expression of the parties’

intent.”288

          The parties do not dispute that the non-compete in § 7.5 of the ATA is valid

and enforceable. Their disagreement for the breach-of-contract claim is limited to

whether Harpoon’s new ProTriTAC molecule falls inside of the Maverick Field. If

it does, then Harpoon’s development of the ProTriTAC molecule was and is in

violation of its non-compete under § 7.5.289

          As previously described, the Maverick Field is defined in § 1.56 of the ATA:

          “Maverick Field” means multi-specific Antigen-binding molecules that
          include: (a) at least one domain that binds to an Immune Effector Target
          that (i) is formed from two domains, each of which is impaired for
          Immune Effector Target binding, and (ii) undergoes a resultant increase
          in Immune Effector Target binding affinity of at least 50 fold after an
          activation event; (b) at least one domain that binds to one or more

287
      Seidensticker v. Gasparilla Inn, Inc., 2007 WL 4054473, at *2 (Del. Ch. Nov. 8, 2007).
288
   Martin Marietta Materials, Inc. v. Vulcan Materials Co., 56 A.3d 1072, 1105 (Del. Ch. 2012).
Because I find the contractual language unambiguous, I do not resolve the parties’ arguments
regarding the step transaction doctrine and whose intent is relevant when considering extrinsic
evidence. Additionally, the parties made various evidentiary objections to evidence on the basis
of irrelevance because it concerned the parties’ intent (Harpoon) or undisclosed intent
(Millennium). In light of my finding here, I consider these evidentiary objections moot.
289
   ATA, § 7.5 (“Harpoon hereby agrees that, effective as of the Distribution, none of Harpoon nor
any of Harpoon’s controlled Affiliates (which, for the avoidance of doubt, shall not include
Maverick) shall, anywhere in the world, directly or indirectly, engage in the Business in any
manner . . . until four (4) years after the Distribution,” with “Business” defined as “the business of
researching, developing, manufacturing or commercializing any product within the Maverick
Field.”).

                                                 54
         Therapeutic Targets; and (c) at least one half-life extension domain,
         which domains (a) through (c) may be linked in various orders.290

         The parties agree that the Maverick Field encompasses the split scFv design

for achieving conditionality utilized in Maverick’s COBRA molecule. However,

this fact does not entail that the language is therefore limited to the split scFv design.

In other words, it would be improper to conclude that Harpoon’s ProTriTAC falls

outside the Maverick Field solely on the basis that it differs from Maverick’s

COBRA molecule. Nothing in the language chosen by the parties supports such a

reading.

         Although conceptually complex, the Maverick Field definition, broken down,

describes seven characteristics of a molecule. If any one of these characteristics do

not describe Harpoon’s ProTriTAC molecule, then it falls outside the Maverick

Field, and Harpoon did not breach the non-compete by developing it. The seven

characteristics, which restate the Maverick Field in a perhaps more digestible

manner, are:

      1. The molecule is “a multi-specific Antigen-binding” molecule;
      2. The molecule has “at least one domain that binds to an Immune Effector
         Target”;
      3. The domain that binds to the Immune Effector Target is “formed from
         two domains”;
      4. The two domains that form the domain that binds to the Immune
         Effector Target are “each . . . impaired for Immune Effector Target
         binding”;

290
      ATA, § 1.56.

                                           55
      5. The domain that binds to the Immune Effector Target “undergoes a
         resultant increase in Immune Effector Target binding affinity of at least
         50 fold after an activation event”;
      6. The molecule has at least one domain that “binds to one or more
         Therapeutic Targets”; and
      7. The molecule has “at least one half-life extension domain.”291

The parties’ disagreement centers on the third, fourth, and fifth elements described

above. The parties do not dispute that the ProTriTAC molecule satisfies the other

four elements. In other words, the dispute centers only on § 1.56 (a)(i)–(ii), which

describes the molecule’s domain that binds to the Immune Effector Target (i.e. the

T cell or immune effector target binding domain) as well as its binding affinity.

          Based on the plain meaning292 of the contractual language, I find Harpoon’s

ProTriTAC molecule is not within the Maverick Field. The language in § 1.56

(a)(i)–(ii) must be read as a whole to comprehend the plain meaning.                         The

descriptions in subsection (a)(1), that the T cell binding domain is “formed from two

domains” and that these domains are “each impaired for Immune Effector Target

Binding,” read in isolation, are reasonably susceptible to multiple interpretations.293

However, the Maverick Field definition clarifies the proper reading in subsection

291
      ATA, § 1.56.
292
   “Plain,” in this context, means clear, based on the language chosen by the parties, in light of
the specialized knowledge sufficient to understand the technical terms used therein, as described
in some detail in the Background section of this Memorandum Opinion. A finding of lack of
ambiguity does not require that the language be immediately comprehensible to a casual reader or
man in the street.
293
      ATA, § 1.56 (a)(i).

                                               56
(a)(ii) when it states that the T cell binding domain “undergoes a resultant increase

in Immune Effector Target binding affinity of at least 50 fold after an activation

event.”294 This language clarifies that the Maverick Field is describing a molecule

activated through the event of separately impaired domains coming together to form

the T cell binding domain, which does not describe Harpoon’s ProTriTAC molecule.

I explain in greater detail below.

          First, the word “domain” in § 1.56 (a) refers to the T cell binding site. As

explained in the factual recitation, the T cell binding site is a scFv.295 The phrase

“two domains” refers to the vL and vH chains that make up the two halves of the

scFv.296 Thus, the phrase “formed from two domains” means that the scFv is

“formed from” the vL and the vH chains. Read in isolation, this is susceptible to

multiple interpretations. Harpoon contends that it describes an act of creation, in the

sense that the Immune Effector Target binding domain is created from the joining

of two domains.297 This comports with dictionary definitions of the verb “form,”

which include the intransitive meaning, “to take form: come into existence,” as well

294
      ATA, § 1.56 (a)(ii) (emphasis added).
295
      JX 133, at 17–19, 58–59.
296
Id. at 58–59; Tr. 1725:2–11 (Lin).
297
   Def. Harpoon Therapeutics, Inc.’s Opening Post-Trial Br., D.I. 307, (“Harpoon Opening
Brief”), at 31–32, 34–35.

                                              57
as the transitive form, “to arrange,” or “to shape or mold into a certain state.”298 The

Plaintiffs, conversely, contend that “formed from” merely means “comprising”; they

argue that every scFv domain consists of a vH and vL domain, and therefore every

scFv domain is “formed from” those two domains.299 In other words, they argue that

no act of creation is implied, and the words merely describe the makeup of a scFv

domain.300 This, too, comports with some dictionary meanings of “form,” which

can mean “to serve to make up or constitute.”301 Thus, taken in isolation, the phrase

is susceptible to both readings.

            Likewise, the phrase “each of which is impaired,” read in isolation, is arguably

ambiguous. Harpoon contends “each of which” implies the domains are separately

impaired for binding.302 Here, the definition uses “each” as a pronoun, which merely

means “each one,” but the adjectival definition of “each” means “every one of two

or more people or things considered separately.”303 Thus, Harpoon’s argument that

298
   Form, Merriam Webster’s Online Dictionary, https://www.merriam-webster.com/dictionary/
form.
299
      Pl. Maverick Therapeutics, Inc.’s Post-Trial Br., D.I. 309, (“Maverick Opening Brief”), at 27–
29.
300
Id.
301
   Form, Merriam Webster’s Online Dictionary, https://www.merriam-webster.com/dictionary/
form.
302
      Harpoon Opening Brief, at 31–33, 35.
303
   Each, Merriam Webster’s Online Dictionary, https://www.merriam-webster.com/dictionary/
each.

                                                 58
“each” implies separate treatment is supported by the dictionary definition.304

Maverick contends “each of which” could be synonymous with “both of which”;

they argue that as long as the vH and vL domains are impaired for Immune Effector

Target binding, they are “each” impaired because they are “both” impaired.305

“Both” means “the one as well as the other,” but when used as a conjunction it can

indicate “the inclusion of each of two or more things.”306 While the linguistic

distinction between “each” and “both” suggests Harpoon’s reading is more

reasonable, when isolated, the phrase is susceptible to both interpretations.

          The next subpart in the Maverick Field, § 1.56 (a)(ii), to my mind, resolves

this ambiguity and clarifies what type of molecule design the Maverick Field

definition is describing. It is worth reciting the contractual language again here:

          “Maverick Field” means multi-specific Antigen-binding molecules that
          include: (a) at least one domain that binds to an Immune Effector Target
          that (i) is formed from two domains, each of which is impaired for
          Immune Effector Target binding, and (ii) undergoes a resultant increase
          in Immune Effector Target binding affinity of at least 50 fold after an
          activation event. . .307

304
   Maverick argues that Harpoon redlines the contract by adding terms like “separately” and
“formation event.” Red-lining, or blue-pencilling, is a revision to introduce something not there;
by contrast, a word’s inherent meanings and connotations are present, and thus drawing out those
meanings through dictionary work does not constitute improper red-lining or blue-pencilling.
Rather, it is an illumination of the plain language already present.
305
      Maverick Opening Brief, at 30–32.
306
   Both, Merriam Webster’s Online Dictionary, https://www.merriam-webster.com/dictionary/
both.
307
      ATA, § 1.56.

                                               59
Thus, Section 1.56(a)(ii) states that the Immune Effector Target binding domain—

which, as noted, is “formed from two domains . . . each of which is impaired”—

“undergoes a resultant increase in Immune Effector Target binding affinity of at least

50 fold after an activation event.”308 The clarifying word is the word “resultant,”

and the key question is, what must the increase in binding affinity “result” from?

          Harpoon points to the placement of the word “resultant” just after the

provision that the Maverick Field refers to molecules formed from two impaired

domains. Accordingly, it argues that a molecule in the Maverick Field is one where

the increase in binding affinity results from the formation event that subpart (a)(i)

describes, when two domains, each separately impaired, join to form the Immune

Effector Target binding domain.309 Maverick, by contrast, contends that “resultant”

is used “to clarify that the post-activation event increase in binding affinity must be

caused by the activation event.”310 They argue that placement of “resultant” in

subpart (a)(ii) would make it absurd for the word to modify or clarify subpart

(a)(i).311 In other words, Maverick’s construction is based primarily on the use of

308
      ATA, § 1.56(a)(ii).
309
      Harpoon Opening Brief, at 30–31, 36.
310
      Pl. Maverick Therapeutics, Inc.’s Post-Trial Reply Br., D.I. 322 (“Maverick Reply Brief”), at
12.
311
Id. at 11–12.

                                                 60
parenthetical subpart designations within the sentence describing the Maverick

Field.

         I agree with Harpoon and disagree with Maverick.

         First, the language in subpart (a)(ii), “undergoes a resultant increase in

Immune Effector Target binding affinity of at least 50 fold after an activation event,”

already implies causation without the word “resultant.”               If “resultant” were

jettisoned, and the subpart read, “undergoes an increase in Immune Effector Target

binding affinity of at least 50 fold after an activation event,” it would not lose any

meaning, and this suggests that “resultant” is not clarifying the causality of the

activation event but, rather, signifying the causality of the formation of the binding

domain described in subpart (a)(i).312

         Second, it is not—pace Maverick—absurd to read “resultant” as modifying

the preceding subpart. I note that using parenthetic romanettes to designate subparts

does not of necessity alter the meaning of the sentence so enhanced. I also note that

it is a more natural construction that “resultant” follow, rather than precede, the

language defining the causative force. “I walked under a low doorway, and as a

result bumped my head” is a more natural English construction than “my resultant

head bump occurred after walking through a low doorway.” Maverick’s reading is

  Technically, the use of “after” could be merely temporal, and not imply causation, but such
312

would be a strained reading in context.

                                             61
unnatural. Harpoon’s is not. Thus, it makes sense that “resultant” refers to the just-

described formation event, and not the to-be-described activation event, given its

placement at the beginning of subpart (a)(ii). Moreover, this reading of the language

resolves the arguably ambiguous phrases in subpart (a)(i). If the fact that the T cell

binding domain is “formed from two domains . . . each of which is impaired” results

in something, then it becomes reasonable to interpret those phrases as describing an

event, as Harpoon does. That event, I find in light of the relevant science as

explained in the evidence submitted at trial, can only reasonably be interpreted as

the joining of separately impaired domains to form a functional binding domain. I

do not find the “Maverick Field” reasonably susceptible to the Plaintiffs’ reading

because it would render “resultant” surplus, rather than giving the word its proper

function, which is to clarify that the formation of the binding domain from two

impaired domains results in an increase in binding affinity.

          Having interpreted the contract language in the Maverick Field, I find that

Harpoon’s ProTriTAC molecule does not fit this definition.          The ProTriTAC

molecule has a fully-formed scFv binding domain from the beginning.313 The vL

and vH domains are both impaired, and it is not their joining that results in the

increase in binding affinity; rather, it is the removal of the peptide mask from the

313
      Tr. 1737:8–18 (Lin).

                                           62
fully-formed domain.314 Therefore, the ProTriTAC molecule is not “formed from

two domains, each of which is impaired,” and because there is no activation resulting

from the formation event of separately impaired domains, it does not undergo “a

resultant increase in Immune Effector Target binding affinity . . . after an activation

event.”315

          Having made this determination, I do not need to resolve the parties’ dispute

over whether the ProTriTAC molecule undergoes a 50-fold increase in binding

affinity, which is the other disputed portion of the Maverick Field definition. I

conclude, accordingly, that Harpoon has not breached the non-compete by

developing the ProTriTAC molecule.

                 2. Misappropriation of Trade Secrets

          Maverick has also brought a claim for misappropriation of trade secrets. To

succeed on its claim that Harpoon misappropriated trade secrets, Maverick must

prove by a preponderance of the evidence that “(1) a trade secret exists; (2) the

plaintiff communicated the secret to the defendant; (3) there was an express or

implied understanding that the secrecy of the matter would be respected; and (4) the

secret information was improperly used or disclosed to the injury of the plaintiff.”316

314
Id. at 800:3–14, 800:23–801:8 (Landes).
315
      ATA, § 1.56.
316
      Elenza Inc. v. Alcon Labs. Holding Corp., 183 A.3d 717, 721 (Del. 2018)

                                                63
I focus on the final element of the claim here because I find that even if trade secrets

existed, Maverick did not prove at trial by preponderance of the evidence that the

trade secrets were improperly used or disclosed to Maverick’s injury.

      What Maverick did successfully demonstrate is that Dr. Luke Evnin and Dr.

Patrick Baeuerle put themselves in an improvident and conflicted situation at the two

companies, and that this improvident situation led to reasonable suspicions of

improper use of Maverick trade secrets. Maverick put forward evidence that made

it reasonably conceivable to imagine that Evnin and Baeuerle acted as conduits to

funnel Maverick’s confidential information and research to Harpoon’s own

conditionally active ProTriTAC platform in violation of trade secret laws and their

fiduciary duties. But reasonably conceivable is not probable, which is the burden of

proof Maverick must carry.         Harpoon offers an alternative explanation for

ProTriTAC’s success, which is that Dr. Jack Lin had a “serendipitous eureka

moment” of insight, and that from this insight Harpoon built the ProTriTAC

molecule using publicly available scientific knowledge as well as its own experience

much more efficiently than Maverick. Important to my decision, I found Lin’s

testimony in this regard credible. Without evidence showing it was more likely than

not that Harpoon built its molecule on illegitimately-obtained information, I decline

to find liability for the misappropriation of trade secrets. I explain further below.

                                          64
          To briefly recount the facts, following the spinout, Evnin and Baeuerle

remained intimately involved in the development of the COBRA molecule at

Maverick.317 Part of COBRA’s development was the selection of component

parts—immune effector targets, cancer cell targets, proteases, and cell lines.318

Evnin and Baeuerle attended board meetings and acted as scientific advisors, and so

they were exposed to all of Maverick’s ongoing research.319

          Meanwhile, Harpoon, without telling Maverick, was developing a competitive

molecule, the development of which would unarguably benefit from the ongoing

research at Maverick. Evnin and Baeuerle testified that they were not involved with

Harpoon’s development of ProTriTAC, and that they never informed Maverick of

Harpoon’s work due to confidentiality obligations.320

          At trial, Maverick described several suspicious circumstances that arose from

this scenario.

          First, Lin brought his “new ProTriTAC” invention to Baeuerle and discussed

it with him, and afterward Baeuerle created a slide deck outlining the concept and

317
      Tr. 1273:11–1274:4, 1277:12–1278:2 (Evnin), 1558:16–1559:14 (Baeuerle).
318
Id. at 563:4–22, 564:4–565:12 (DuBridge), 780:16–781:20 (Landes).
319
Id. at 549:8–15, 562:15–563:3, 564:4–566:21 (DuBridge), 893:8–894:14 (Scibetta), 653:13–
654:3, 664:10–22, 670:16–672:15 (May), 1495:10–15, 1469:6–1471:1, 1558:16–1559:14
(Baeuerle).
320
Id. at 1278:3–19 (Evnin), 1559:15–24, 1516:23–1517:5 (Baeuerle).

                                               65
listing himself as an author alongside Lin—albeit in a smaller font.321 Baeuerle

discussed the “new ProTriTAC” with Evnin.322 He provided edits and commentary

on the SITC Poster that publicly disclosed the ProTriTAC molecule.323 Lin thanked

him on several occasions for his time and his help.324 At trial, Baeuerle testified that

his assistance was entirely cosmetic—creating graphics, fixing typos, acting as a

sounding board—rather than substantive.325 Similarly, Evnin discussed ProTriTAC

with Baeuerle and requested to be listed as an inventor due to an ancillary invention.

And while on one occasion, Evnin forwarded (probably inadvertently) confidential

Maverick information to Harpoon’s CEO, Evnin also testified he never engaged

substantively with the ProTriTAC platform at Harpoon.326

          Second, the SITC Poster revealed that ProTriTAC employed the same tumor

targets (EGFR and EpCAM), protease (MMP9), and cell line (HCT-116) as the

321
Id. at 1544:4–1545:8 (Baeuerle); JX 717, at 2.
322
      JX 730, at 2.
323
      Tr. 1553:22–1556:1 (Baeuerle).
324
Id. at 1555:4–1556:1 (Baeuerle).
325
Id. at 1553:22–1554:13 (Baeuerle). Maverick also points to a November 5, 2018 email from
Baeuerle to Wesche in which Baeuerle writes, “Given that MAV is going for EGFR, we may want
to do EpCAM to not appear overly competitive.” JX 952, at 1. While this email is suspicious as
it relates to Harpoon’s competition, Maverick disclosed its use of EGFR in a patent application in
September 2017. JX 738; see also JX 767.
326
   JX 730 (email discussing inventor-ship of patent application); JX 791 (email noting Evnin’s
request to be listed as inventor); Tr. 1278:3–19 (Evnin); JX 669, at 1 (forwarding confidential
information to Harpoon CEO McMahon); Tr. 1299:14–20, 1305:5–1306:4 (Evnin) (describing
email disclosure as inadvertent).

                                                  66
COBRA molecule.327 This appeared suspicious to Maverick, and rightly so: this

exact combination of targets, protease, and cell line had never previously been

used.328       Maverick concludes the component research was misappropriated.

Harpoon points to journal articles, patent applications, and presentations that it says

allowed it to select from a narrow field of potential components and that made its

ultimate choices the best candidates.

          At trial, Lin testified as to how his team selected each component. Lin had

prior experience and Harpoon had done prior research on EGFR.329 Harpoon had

conducted its own research on EpCAM and seen other patents that contemplated it

as a tumor target.330 Maverick, among other companies, had disclosed the use of

MMP9 in conditionally active T cell therapies.331 HCT-116 had been commonly

used as a cell line, and patent disclosures and Harpoon’s prior work suggested it was

optimal.332 In addition, a patent application by a third party—Amunix—disclosed

the combination of these four elements in a narrow pool of possible options.333 In

327
      Tr. 1768:19–1769:24, 1773:11–1774:6, 1780:21–1781:7 (Lin), 571:22–573:7 (DuBridge).
328
      See id. at 570:22–571:15 (DuBridge).
329
Id. at 1769:12–24, 1770:5–1771:24 (Lin); JX 435, at 10.
330
      JX 651; JX 660; JX 133, at 53; JX 774, at 6; Tr. 1776:9–13 (Lin).
331
      JX 178, at 90–91; Tr. 1782:12–1783:10 (Lin); JX 133, at 50; JX 738, at ¶¶ 358, 126.
332
   Tr. 1788:10–1789:18 (Lin); JX 48; JX 79; JX 90; JX 113; Tr. 606:13–23 (DuBridge); JX 580;
JX 651, at 32.
333
      See JX 651.

                                                 67
other words, Harpoon testified that it landed on the same combination of components

for its ProTriTAC molecule because it independently determined, just as Maverick

did, that this was the best combination of targets, protease, and cell line.

          I agree with Maverick that this evidence is suspicious. Evnin and Baeuerle,

by maintaining any interaction at all—even cosmetic commentary and guidance—

with Harpoon’s ProTriTAC platform, crossed the boundaries of divided loyalties at

the two companies.334 Consequently, and in light of Harpoon’s fraud discussed

below, I found their testimony of limited credibility. I also agree that viewing

Harpoon’s selection of an identical set of components as fortuitous merits a

jaundiced eye. At the same time, Maverick offers only circumstantial evidence and

asks me to infer from these suspicious circumstances that inappropriate disclosures

in fact occurred. Taking the record as a whole, I find the evidence insufficient to

reach that conclusion. Harpoon’s witnesses—Lin in particular—testified credibly at

trial about his revelatory scientific process, what role each person at Harpoon played,

and how the initial “eureka” moment developed into the ProTriTAC molecule

disclosed on the SITC Poster through the mining of publicly available scientific

research as well as Harpoon’s own internal research. In order to find for Maverick,

I must find Lin’s testimony to be deluded or perjurious, which strikes me, after

hearing it, as unlikely. Weighing the evidence, the innocent invention of Harpoon’s

334
      Notably, Maverick has not brought a breach of fiduciary duty claim against Baeuerle or Evnin.

                                                 68
ProTriTAC molecule is not so unlikely as to convince me that it is more likely than

not that Harpoon lied about its development process.

          In sum, Evnin’s and Baeuerle’s choices are by no means models of fiduciary

behavior, particularly where divided loyalties and dual roles at competitive

companies are involved. They should have maintained better separation than they

did in their roles at the two companies. Harpoon’s selection of the same components

utilized in Maverick’s COBRA molecule are suspicious at first glance—after

hearing testimony, that selection, absent purloined information, also appears logical.

The evidence does not convince me that it is more likely than not that Harpoon

designed the ProTriTAC molecule using confidential information misappropriated

from Maverick.

          B. Millennium’s Claims

          Millennium never entered a contract with Harpoon. It was not a party to the

ATA.335 Thus, it cannot bring contract claims against Harpoon because Harpoon

never made any contractual representations to it.336 Millennium was a party to the

Collaboration Agreement (under which it agreed with Maverick to fund Maverick

research) as well as the Warrant Agreement (under which it obtained from Maverick

335
      Stip., ¶¶ 29–30; JX 1.
336
   Harpoon itself emphasizes this point in its post-trial briefing. See Harpoon Opening Brief, at
47–51.

                                               69
a right to purchase Maverick after a set time period).337 The Agreements were

sufficiently intertwined, however, that Millennium negotiated all three Agreements

and gave final approval to the ATA.338 Millennium therefore brings tort claims

against Harpoon, arguing that Harpoon fraudulently induced it into entering the

Collaboration and Warrant Agreements with Maverick by misleading it into thinking

that Maverick would have broad rights in the inducible T cell engager space free

from competition from Harpoon for four years.

          Millennium also claims that Harpoon’s entrance into the inducible space with

the invention of the ProTriTAC molecule constitutes tortious interference and unfair

competition. In the alternative, it argues Harpoon was unjustly enriched. I find there

is sufficient evidence to prove that Harpoon is liable for fraud, but I deny

Millennium’s claims for tortious interference with contract and business relations,

and for unfair competition. Because finding liability for fraud provides Millennium

with a legal remedy, its claim for unjust enrichment—pled in the alternative—

necessarily falls away. My reasoning is below.

                  1. Fraud and Fraudulent Inducement

          The elements of fraud and fraudulent inducement are the same339:

337
Id. ¶ 23; JX 2; JX 3.
338
   Tr. 237:13–20 (Hurff), 714:22–715:9 (Hiett); 1189:22–1191:4, 1199:8–17, 1256:20–1257:18
(Evnin), 1340:16–1341:10 (Hostetler).
339
      Indeed, since inducement is an element of fraud, separating the torts is tautological.

                                                   70
       (1) a false representation, usually one of fact, made by the defendant;
       (2) the defendant’s knowledge or belief that the representation was
       false, or was made with reckless indifference to the truth; (3) an intent
       to induce the plaintiff to act or to refrain from acting; (4) the plaintiff’s
       action or inaction taken in justifiable reliance upon the representation;
       and (5) damage to the plaintiff as a result of such reliance.340

Each element of fraud has further legal nuances, which I explore as I walk through

the elements below. After examining the evidence, I find that Harpoon fraudulently

induced Millennium into investing in Maverick because, while affirming

Millennium’s broad understanding of Maverick’s trajectory, Harpoon intentionally

concealed its competitive efforts to avoid disclosing its understanding of the

Maverick Field definition it crafted.

                     a. Harpoon’s False Representation

       The first element of fraud, a “false representation,” can take several forms: it

may be an “overt misrepresentation” (i.e. a lie), a “deliberate concealment of

material facts,” or else “silence in the face of a duty to speak.”341 To show deliberate

concealment, Millennium must prove that Harpoon “took some action affirmative in

nature designed or intended to prevent, and which [did] prevent, the discovery of

facts giving rise to the fraud claim, some artifice to prevent knowledge of the facts

340
   Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I, LLLP, 2018 WL 6311829, at
*32 (Del. Ch. Dec. 3, 2018) (citing E.I. DuPont de Nemours & Co. v. Fla. Evergreen Foliage, 744
A.2d 457, 461–62 (Del. 1999); Stephenson v. Capano Dev., Inc., 462 A.2d 1069, 1074 (Del.
1983)).
341
  Stephenson, 462 A.2d at 1074; see also Corporate Prop. Assocs. 14 Inc. v. CHR Holding Corp.,
1008 WL 963048, at *6 (Del. Ch. Apr. 10. 2008).

                                              71
or some representation intended to exclude suspicion and prevent inquiry.”342

Likewise, if “before the consummation of a business transaction,” Harpoon

“acquire[d] information that the speaker ‘knows will make untrue or misleading a

previous representation that when made was true,’” then it had a duty to speak.343

          Early in the spinout negotiations, Harpoon made several affirmative

representations to Millennium. It emphasized that the Maverick technology was a

broad discovery platform.344 It represented that the concept behind the dual build-

to-buys was Harpoon’s continuation of inherently active therapies, with Maverick

taking on conditionally active therapies.345 This representation was not limited to

conversations or discussions, merely. Harpoon offered a graphic presentation of the

companies that confirmed these divergent paths: Harpoon would continue its work

on inherently active engagers, and Maverick would work with the new inducible

technology.346

342
   Metro Comm. Corp. BVI v. Advanced Mobilecomm Techs. Inc., 854 A.3d 121, 150 (Del. Ch.
2004) (quoting Lock v. Schreppler, 426 A.2d 856, 860 (Del. Super. 1981)).
343
   Great Hill Equity Partners, 2018 WL 6311829, at *32 (quoting In re Wayport, Inc. Litig., 76
A.3d 296, 323 (Del. Ch. 2013)).
344
      Tr. 22:6–9 (Hurff), 8:16–9:10, 12:4–11 (Arendt), 1255:14–18 (Evnin).
345
Id. at 1082:13–1084:4 (Evnin) (“[W]e would spin out the nascent conditionally active
technology into a new company, which we then referred to as Maverick.”), 20:16–24 (Arendt).
346
    JX 143, at 65 (PowerPoint describing the partnership as dividing Harpoon into “TRIDENTS
[i.e. inherently active] (build to buy)” and “CD3 Inducible Platforms (spinout)”); Tr. 19:3–20:24,
21:8–23 (Arendt), 1082:13–23 (Evnin).

                                                72
          Early concept sheets the parties exchanged laid out this divide unequivocally:

“Harpoon would spinout a newly created entity (‘Maverick’) that would hold the

technology and intellectual property relating to its inducible T-cell engagement

platform.”347 Over the course of two months of negotiations, the parties exchanged

six term sheets, and every one included identical language stating that the new

Maverick company would contain “technology and intellectual property relating to

[Harpoon’s] inducible T-cell engagement platform.”348 A presentation from future

Maverick scientist Dr. Robert DuBridge and discussions with Millennium personnel

confirmed this understanding: Maverick was set to explore conditional activation in

a broad discovery platform, with numerous paths and iterations on the way.349

          This evidence sufficiently proves that Harpoon understood that Millennium

believed it was investing in the inducible T cell space, broadly defined, and not a

specific technology. The fact that presentations and discussions focused on the split

scFv design currently at Harpoon does not disprove Millennium’s broad

understanding of the Maverick company trajectory: the original ProTriTAC (which

347
      JX 156, at 4.
348
   JX 156, at 4 (June 3, 2016 term sheet); JX 159, at 5 (June 13, 2016 term sheet); JX 168, at 8
(June 23, 2016 term sheet); JX 167, at 6 (June 24, 2016 term sheet); JX 169, at 8 (June 29, 2016
term sheet); JX 191, at 8, 20 (July 21, 2016 term sheet).
349
    Tr. 42:22–44:2, 44:23–45:21 (Arendt), 526:18–527:5 (DuBridge); see also JX 191, at 23
(defining “Maverick Platform Improvements” as “any optimization, enhancement, improvement
or modification to any of the [various] components of the Maverick Licensed Intellectual
Property”).

                                              73
became COBRA) was the inducible technology at Harpoon that would lay the

groundwork for the Maverick space. This was the understanding Harpoon possessed

when it drafted the Maverick Field.

          Contemporaneous with drafting the Maverick Field, Harpoon stated freely in

internal emails never shared or discussed with Millennium that it intended to draft a

definition limiting the Maverick Field to the existing split scFv design.350 Harpoon

argues that these internal emails, such as Hostetler’s descriptions of the Maverick

Field definition as “simple and clear,” conclusively demonstrate the lack of

fraudulent intent or false representation.351 The correspondence demonstrates that

Harpoon, internally, found the language accomplished what it wanted in its contract

with Maverick; it does not speak to how Harpoon then acted in its negotiations and

dealings with Millennium.

          Harpoon expressly contemplated the idea that it would continue to work on

inducible T cell engagers, using concepts other than the split scFv technology it

considered to comprise the Maverick Field.352 Yet, Harpoon never used the terms

“split scFv” or “split dimer” in the Maverick Field definition, and over the course of

the next several months of ongoing negotiations, it never once clarified to

350
      JX 206, at 1; JX 227-A, at 1; see also Tr. 1095:14–1096:16 (Evnin).
351
      See JX 238, at 1; Harpoon Opening Post-Trial Br., at 62.
352
      See JX 246, at 1.

                                                 74
Millennium its narrower perception of the Maverick Field—indeed, it never used the

terms “split scFv” or “split dimer” with Millennium at all.353 Harpoon’s silence is

telling, particularly when Millennium personnel testified that they communicated

their intent to move beyond the current inducible designs, which were, at that point,

unproven.354 Harpoon’s trial testimony—that such clarifications were unnecessary

because the definition it composed for its contract with Maverick was so clear it was

“understood by all”—is unconvincing in light of the content and history of the

negotiations that laid out such a clear direction for Maverick in the inducible space

and a clear direction for Harpoon in the inherently active space.

          Prior to signing the ATA with Maverick, Harpoon took several actions that

demonstrate an active concealment of its intent to continue developing inducible T

cell engagers. In the middle of negotiations, Harpoon filed a patent application for

conditionally active technology.355 It claimed it did not need to disclose the patent

application because it did not relate to the Maverick Field—nonetheless, it withdrew

the application and refiled it just after all three Agreements were finalized.356 In the

353
   Tr. 78:13–79:10, 198:17–199:5 (Arendt), 450:6–15 (Geesaman), 532:11–533:1 (DuBridge),
1224:1–1225:10, 1261:21–1262:3 (Evnin), 1382:7–11, 1388:13–20 (Gerber), 1351:24–1352:3
(Hostetler); Guenot Depo. Tr. 21:18–25; JX 1, § 1.56.
354
      Tr. 78:13–79:10 (Arendt).
355
      JX 336.
356
  See JX 904, at 3; Tr. 1231:12–1233:2 (Evnin); Guenot Depo Tr. 25:23–26:14, 29:1–18; 215:14–
216:8.

                                             75
two months leading up to the spinout, Harpoon continued to communicate that the

companies were on separate trajectories, divided along the boundaries of inherently

and conditionally active technology. In November, Baeuerle sent plans to DuBridge

and Wesche for the separation of the companies, entitled “Separation of Harpoon

(TriTAC platform) and Maverick (Pro-TriTAC platform).”357                              In email

communications related to its series B financing in the month before the spinout,

Harpoon described the company trajectories in line with Millennium’s

understanding: “the Pro-TriTAC platform for conditional activation of T cells in the

tumor microenvironment, has been spun out into sister company Maverick . . .

Harpoon has retained rights for Pro-TriTACs (conditional activation in the tumor)

for the engaging of all other immune cells (except T cells).”358 In other words,

Harpoon’s public representation to Millennium could hardly have been clearer that

the companies had distinct and divergent trajectories: Harpoon was not going to do

work that Maverick did. In the same vein, prior to the deal’s close, Guenot sought

Millennium’s approval for a narrow and specific carveout for inducible work on a

specific type of T cell, “Natural Killer T cells.”359 This last-minute revision could

357
      JX 366, at 3.
358
      JX 430, at 1; see also JX 438, at 1; JX 456, at 1; JX 558, at 1; JX 590, at 1.
359
      Stip., ¶ 27.

                                                   76
only corroborate Millennium’s view that if Harpoon wanted back into the broad

inducible space it was giving to Maverick, it would ask for it.

          In contrast to this presentation of the companies’ trajectories as separate, in

internal emails in the weeks leading up to the spinout, Evnin and Baeuerle discussed

new ways to achieve conditionally active T cells but agreed to “invent after the deal

is closed.”360        Similarly, Evnin told others at Harpoon to keep quiet about

technologies at Harpoon that Takeda “do[es] not know about now.”361

          The testimony from Harpoon’s witnesses at trial did not credibly overcome

the scenario this evidence presents.        Harpoon understood Millennium entered

negotiations with a broad concept of investing in the inducible T cell space. Harpoon

confirmed this understanding by representing the company trajectories as separate

and exclusive. It then crafted the Maverick Field definition with the intent—which

it took pains not to disclose—to limit the Maverick Field to certain technologies so

that it could compete in the inducible space in the future.            Knowing that if

Millennium knew its intent, the Maverick Field would be renegotiated, it withdrew

a patent, postponed invention, and encouraged silence rather than communication to

avoid “raising the[] ire” of Millennium, who it understood conceived the Maverick

Field differently.

360
      JX 474, at 1.
361
      JX 500, at 1.

                                            77
          This evidence is sufficient to prove that prior to the spinout, Harpoon made a

false representation both by “deliberate concealment of material facts,” and by

maintaining “silence in the face of a duty to speak.”362

                        b. Harpoon’s Knowledge that the Representation was False

          A false representation, by itself, is insufficient; Millennium must also show

that Harpoon knew of the falsity and made it with reckless indifference to the truth.

This requires something more than ordinary negligence; Millennium must show that

Harpoon exhibited conscious disregard for the truth.363 I find this element satisfied.

          The facts that demonstrate active concealment, described above, I find also

demonstrate the scienter necessary for this second element of fraud. I will not repeat

them in full. Harpoon understood Millennium’s broad concept of the field. It

confirmed that understanding by unequivocally representing that the companies had

separate, non-overlapping futures—one with inherently active technologies, one

with conditionally active technologies. It then drafted the Maverick Field definition

to allow it to compete, but it maintained complete silence regarding its intent to

compete. Harpoon’s intentionality is demonstrated by its affirmative acts, such as

withdrawing and refiling the patent application, and reminding Harpoon personnel

not to discuss technologies on which it was actively working.

362
      Stephenson v. Capano Dev., 462 A.2d 1069, 1074 (Del. 1983).
363
   Metro Comm. Corp. BVI v. Advanced Mobilecomm Techs. Inc., 854 A.3d 121, 147 (Del. Ch.
2004).

                                               78
          The email exchange between Evnin and Baeuerle in the final two weeks

before the spinout is illustrative of the knowledge Harpoon possessed. Baeuerle

indicated that it “[w]ould be great to have a CD3 binding domain formed from two

pieces defined in the Maverick Field (...because I have an idea to get to T cell

engagers without.”364 Evnin responded, “I think if we invent something NEW it is

not part of this deal. . .”365 Baeuerle suggested, “[p]erhaps we should invent after

the deal is closed” because the concept he was working on was “T’s [Takeda’s]

nightmare.”366 The exchange provides a window in Harpoon’s intent to compete

with Maverick and its knowledge that it needed to keep this intent hidden from

Millennium, the company that would invest in Maverick. This, in turn, demonstrates

that it knew its representations of divergent company trajectories was false, and it

knew that its silence was actively concealing the true nature of the spinout from

Millennium.

          Because the fraud claim necessarily focuses on Harpoon’s actions to induce

Millennium into participating in the spinout, my focus is on the period prior to

Millennium’s signing the Collaboration and Warrant Agreements.            However,

Harpoon’s ongoing concealment, post-spinout, provides additional telling evidence

364
      JX 476, at 2.
365
      JX 474, at 1.
366
      JX 476, at 1.

                                          79
of its knowledge during the negotiation phase. In preparing press releases in May

2017, Harpoon’s CEO McMahon instructed the public relations consultant to

eliminate mentions of Harpoon’s work on conditionally active T cell engagers

because “that is Maverick and Takeda would sue us.”367 In June 2017, Biocentury

published an article, in which Evnin and McMahon both commented on the spinout

and described the companies’ trajectories in a way that confirmed Millennium’s

understanding—not Harpoon’s.368            McMahon specifically stated that Harpoon

“carefully, strategically carved the Maverick platform out of Harpoon and it really

is not competing.”369 Internal commentary on the article from Harpoon personnel

show that it knew these statements were inaccurate.370 Similarly, when Harpoon

approached Takeda for funding of its inherently active platform, it scrubbed mention

of its inducible T cell engagers to avoid scrutiny.371 “Please recall that Takeda is the

Maverick partner,” Evnin wrote, “they would not be excited to hear about some of

[Harpoon’s] work . . . . e.g. on T cell engagers.”372

  JX 681, at 1. McMahon’s testimony at trial that his email was merely an “unfortunate phrasing”
367

was unconvincing.
368
      JX 748, at 2.
369
Id.
370
      JX 749, at 1.
371
      JX 814, at 1.
372
Id.

                                              80
            Although evidence regarding post-spinout knowledge is not dispositive, it

provides insight into Harpoon’s knowledge of the falsehood it conveyed to

Millennium through active concealment and silence.                   The parties’ differing

understandings of Harpoon’s non-compete obligations as circumscribed by the

Maverick Field and the companies’ trajectories was not due to Harpoon’s accident

or its negligence. Rather, Harpoon, intending to continue to work on conditionally

active T cell engagers, carefully avoided disclosing that intent, not just prior to the

spinout, but for almost a year and a half afterward while it followed through and

became a competitor with Maverick. I find that Harpoon had knowledge of its false

statements made through concealment and silence.

                        c. Harpoon Made the False Representations to Induce
                        Millennium to Participate in the Maverick Spinout through the
                        Collaboration and Warrant Agreements

            The third element of fraud requires that the defendant made the false

statements recklessly or with the specific intent to obtain the desired action.373 Such

scienter may be demonstrated through circumstantial evidence, including

demonstrating motive and opportunity for the inducement.374 In cases where a fraud

claim centers on a transaction, the transaction itself may serve as both the motive

and opportunity to commit the fraud.

373
      Deloitte LLP v. Flanagan, 2009 WL 5200657, at *8 (Del. Ch. Dec. 29, 2009).
374
Id.

                                               81
          Here, Millennium has demonstrated motive and opportunity that support

finding Harpoon’s false representations were made to induce Millennium to

participate in the spinout through the Collaboration and Warrant Agreements with

Maverick. As a part of the spinout, Harpoon received $6.75 million through a

promissory note from Maverick, as well as over 4 million shares of Maverick

common stock and 15 million shares of Maverick preferred stock, which it

distributed to its stockholders pro rata.375 Originally, when the parties first discussed

a transaction in the spring of 2016, they contemplated a dual build-to-buy—Takeda

would invest in both companies, with the option to purchase both.376 Thus, motives

were not necessarily skewed in one direction. By August 2016, when the parties

were negotiating the Maverick Field, it was clear that Takeda was considering

investing in only one build-to-buy, Maverick, which motivated Harpoon to ensure

that it had an independent “growth path” for its future.377 In October 2016, following

Takeda’s due diligence, Takeda (through Millennium) narrowed its interest to

Maverick as a single build-to-buy.378

          At that point, Harpoon faced a future as an independent company, and it had

a motive to maintain a space for itself at the cutting edge of immunotherapy. As Lin

375
      Stip., ¶ 38.
376
Id. ¶ 21.
377
      Tr. 1089:1–11 (Evnin).
378
      Stip., ¶ 22.

                                           82
testified, inducible T cell engagers were the “next shiny thing,” and they were where

the market was likely moving in the immunotherapy space.379 This would be

confirmed for Harpoon shortly after the spinout as large pharmaceutical companies

unanimously expressed interest in inducible technologies but not inherently active

technologies.380 On February 24, 2017, less than two months after the spinout,

Harpoon’s CFO quipped, “Maybe we can do another spin out?                                Whaler

Therapeutics?”381 He continued, “inducible seems very attractive to the market . . .

[a]ssume this is why Takeda ended up with Maverick vs just an investment in

Harpoon or ownership of Harpoon.”382 McMahon responded, “[s]omewhat foolish

but we will take advantage of this enthusiasm next year.”383

            In addition to its motivation to maintain a cutting-edge space in

immunotherapy, possibly to create another spinout, Harpoon had the opportunity. It

still had Baeuerle and Evnin, who had invented the initial ProTriTAC concept that

became the Maverick spinout. Baeuerle had ideas for new developments in the

inducible space.384          In fact, even during negotiations, Harpoon had ideas for

379
      Tr. 1827:4–19 (Lin).
380
    JX 644, at 2 (Merk); JX 740, at 2 (Eli Lilly); JX 758, at 6 (Pfizer), 12 (AZ/MEDI); JX 769, at
4 (Johnson & Johnson); JX 1200, at 2 (Eli Lilly).
381
      JX 644, at 1.
382
Id.
383
      Id.
384
      See JX 476, at 2.

                                               83
inducible T cell engagers far enough along to file a patent application.385 Then, it

had the opportunity to define the Maverick Field in collaboration with counsel,

without the need to disclose that it was “trying to keep [the Maverick Field] focused

on the current Maverick invention or something very close to it.”386 Meanwhile,

Baeuerle was inquiring if Harpoon could get specific language into the Maverick

Field definition that would allow him to design around it, and “get to T cell engagers

without,” a possibility he dubbed “T’s [Takeda’s] nightmare.”387

          In sum, I find that Millennium has proved, through competent circumstantial

evidence, that Harpoon made its false statements with the intent to induce

Millennium into investing in Maverick, and while Millennium thought Maverick

would have plenary rights to the inducible T cell space, Harpoon maintained,

through concealment and silence, its intent to continue innovation in that sector of

immunotherapy, which was proving attractive to investors.

                        d. Millennium Justifiably Relied on the False Representations

          Millennium must also demonstrate it justifiably relied on Harpoon’s

representations when it participated in the spinout by entering the Warrant and

Collaboration Agreements with Maverick. This means, first, that it did not know

385
      JX 336.
386
      JX 227-A, at 1.
387
      JX 476, at 1.

                                            84
Harpoon made a false statement.388 Thus, if Millennium in fact shared Harpoon’s

understanding of the Maverick Field in negotiations, then it cannot have justifiably

relied. A plaintiff must not walk blindly into a situation, but rather is expected to

undertake reasonable diligence to verify statements.389 If Millennium should have

discovered Harpoon’s intent or the plain meaning of the Maverick Field, it did not

justifiably rely.

       Finally, “the inducing ‘representation must not only be material, but must

concern an essential part of the transaction.’”390 In light of the fact that Millennium

was aware of the language defining the scope of Harpoon’s non-compete (i.e. the

Maverick Field), and in light of the fact that I have found this language

unambiguous, justifiable reliance is a steep hill for Millennium to climb despite the

fact that it was not a party to the contract; nonetheless, I find it has reached that

summit.

388
   See Universal Enter. Grp., L.P. v. Duncan Petroleum Corp., 2013 WL 3353743, at *14 (Del.
Ch. July 1, 2013) (quoting NACCO Industries, Inc. v. Applica Inc., 997 A.2d 1, 29 (Del. Ch.
2009)).
389
    See Paron Capital Mgmt., LLC v. Crombie, 2012 WL 2045857, at *7 (Del. Ch. May 22, 2012),
aff’d, 62 A.3d 1223 (Del. 2013).
390
   Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I, LLLP, 2018 WL 6311829, at
*33 (Del. Ch. Dec. 3, 2018) (quoting E.I. DuPont De Nemours & Co. v. Fla. Evergreen Foliage,
744 A.2d 457, 462 (Del. 1999)).

                                            85
                               i. Millennium did not Share Harpoon’s Understanding of
                               the Maverick Field

          As just described, if Millennium knew that the Maverick Field was limited to

the split scFv design and entered its contracts with Maverick with this understanding,

then it did not justifiably rely on Harpoon’s statements suggesting a broad company

trajectory for Maverick, as examined above.            It would be unreasonable of

Millennium to knowingly agree to a narrow Maverick Field definition for the non-

compete and at the same time rely on Harpoon’s representations that the companies

had non-overlapping trajectories, which implied that it would not be a competitor.

          Harpoon does not deny that it refrained from explicitly discussing, during

negotiations, the limitations it intended the Maverick Field to carry (Harpoon

maintains that the definition was so clear and succinct such clarifications were

unnecessary).391 Instead, Harpoon essentially relies on five pieces of evidence that

it contends demonstrate Millennium understood all along that the Maverick Field

was limited to molecules that utilized the split scFv concept. I examine this evidence

in some detail below because of the weight Harpoon places on it to demonstrate the

parties’ mutual understanding.

          The “3-year” alternative. First, negotiations hit a snag when Millennium

realized that as the Maverick Field was then currently drafted, Harpoon would be

391
      Tr. 1261:21–1262:3 (Evnin).

                                             86
able to “generate an essentially similar platform” simply by using a T cell target

other than CD3.392 Harpoon initially rejected Millennium’s resulting attempt to

expand the Maverick Field definition to include all T cell targets. 393 Millennium’s

Chris Arendt worried that without this broader definition, he was “losing . . .

exclusive inducible platform.”394 Chris Hurff summarized what Arendt hoped to

accomplish by expanding the definition to all T cell targets: “Build a wall around all

things T-cell (preclude any inducible platform to Harpoon for T-cells, not just

CD3).”395 In other words, it appears that Millennium believed that by expanding

from a “CD3 target” to any “Immune Effector Target,” it was effectively capturing

the inducible T cell platform, which aligned with its understanding of the Maverick

spinout.396

            Hurff then listed several “alternatives” if Millennium could not successfully

“[b]uild a wall around all things T-cell.”397 One of these alternatives was to impose

“[s]ome time limit before Harpoon could do any T-cell work (3 years?).”398 At that

point, the ATA already contemplated a 4-year non-compete for Harpoon. Harpoon

392
      See JX 445, at 3.
393
      JX 433, at 13–14.
394
      JX 445, at 2.
395
Id.
396
      See JX 445.
397
Id. at 2–3.
398
Id. at 3.

                                              87
maintains that Hurff’s suggestion of a 3-year prohibition on “any T cell work” shows

that Hurff understood the limits of the Maverick Field and wanted to exchange a

shorter non-compete for a broader field definition.399 Harpoon improperly interprets

this evidence, to my mind, for two reasons. First, it appears that at this juncture,

Millennium believed it did not have exclusive rights to the inducible platform as

long as the Maverick Field definition limited immune effector targets to CD3, rather

than T cell targets broadly.400 Thus, proposing a shorter non-compete in exchange

for an expanded definition (“any T-cell work”) makes some sense. The final

Maverick Field definition in fact expanded the definition from “CD3” to the defined

term “Immune Effector Target,” and thus it appears that Millennium succeeded in

expanding the definition without having to trade a shorter non-compete period.

Based on Arendt’s and Hurff’s emails, it further appears that the expansion of the

definition to “Immune Effector Target,” from Millennium’s perspective,

successfully “precluded any inducible platform to Harpoon for T-cells.”401 In other

words, Millennium thought it had sufficiently extended the “ring-fence” to support

its (then and current) understanding of the Maverick Field. Therefore, the alternative

399
   Harpoon Opening Brief, at 52–55. At trial, Hurff struggled to explain what he meant, at one
point proposing that he may have forgotten about the existing non-compete. Tr. 357:7–363:22
(Hurff).
400
      JX 445, at 3.
401
      See id. at 2–3.

                                             88
3-year non-compete makes sense as an alternative proposition at a prior point in the

negotiations. Second, Hurff’s proposal, taken literally (“any T-cell work”), would

also prevent Harpoon from working on all inherently active T cell engagers—

essentially, it would shut Harpoon’s doors for three years. I find Hurff’s statement,

from that point of view, imprecise at best, but Harpoon’s proposition that it

demonstrates Hurff’s understanding of a narrow Maverick Field as it was ultimately

defined is not credible.

          “Version 2” of Maverick. Second, on the date the ATA was executed,

December 31, 2016, Arendt wrote Hurff that “version 2” of the Maverick technology

might be an “entirely new conditional approach if approved at [Joint Steering

Committee].”402 The ATA requires joint steering committee approval for any work

done outside of the “Collaboration Field.”403 The Collaboration Field is identical to

the Maverick Field, except that it limits immune effector targets to the most popular

target: CD3. Harpoon interprets this statement to mean that Arendt understood the

Maverick Field to be limited to the split scFv design because a “new version”

referenced a new approach to achieving conditionality, which, Arendt was implying,

was outside the Maverick Field. I find this unpersuasive. Arendt’s statement,

402
      JX 562, at 1.
403
   The Collaboration Field is defined in § 1.13 of the Collaboration Agreement. JX 2, § 1.13.
Sections 2.1.1(c) and 3.4 require joint steering committee approval for developments outside the
Collaboration Field. JX 2, §§ 2.1.1(c), 3.4.

                                              89
contemplating a “new version,” matches up with his concerns expressed earlier that

month that Millennium intended the Maverick platform to develop quickly beyond

CD3 to other immune effector targets.404 Such a development would require joint

steering committee approval under the Collaboration Agreement. Given Arendt’s

previous emails and concerns, his reference to an “entirely new conditional

approach” requiring joint steering committee approval is best read, to my mind, as a

reference to non-CD3 immune effector targets, not methods of conditionality.

          Harpoon “can go for inducible.” Third, Hurff wrote in internal notes that

from Arendt’s perspective, “[Harpoon] can go for inducible, just not based on this

IP.”405      Harpoon sees this as clear evidence that Millennium understood the

Maverick Field was limited to “this IP,” which per Harpoon referred to the split scFv

design.406 Once again, in the context of negotiations, this interpretation is not

persuasive. This email chain is part of a key point in the negotiations in December

2016, when Millennium realized that if the Maverick Field only encompassed CD3

immune effector targets, then the Grant-Back License would permit Harpoon to

create a knockoff technology by simply using a different immune effector target.

404
    See JX 445, at 3 (expressing a desire “to make sure that innovation can still happen in Maverick
in terms of platform improvements/innovations beyond CD3.”).
405
      JX 426, at 1.
406
   Harpoon Opening Brief, at 52 (Arendt’s statement “is diametrically opposed to Millennium’s
current position that Harpoon cannot pursue inducible T cell engagers.”).

                                                90
Hence the email was entitled, “Chris A freaked out…”407                  As discussed,

Millennium’s ultimate reaction was to negotiate an expansion of the definition from

CD3 to any “Immune Effector Target,” which it believed effectively built a “ring-

fence” around inducible T cell engagers. The entire sentence—rather than the

snippet Harpoon extracts—makes sense in this context: “For this investment we

need full IP; [t]hey can go for inducible just not based on this IP.”408 In other words,

“this IP” logically refers to “full IP.” To justify its massive investment in the

Maverick technology, Millennium required access to the “full IP,” or all T cell

targets (not just CD3). Harpoon could continue to work on inducible technology,

but it could not do so on “this IP,” meaning it could not use inducible technology to

target T cells.

          Conditionally active T cell engagers exist outside the Maverick Field. Fourth,

at depositions and at trial, Arendt and DuBridge both admitted that Harpoon’s

TetraTAC concept as well as certain other theoretical designs fall outside the

Maverick Field, thus demonstrating that the Maverick Field could not have

encompassed the entire inducible T cell space.409 Moreover, Maverick’s numerous

407
      JX 426, at 1.
408
      JX 426, at 1.
409
      Tr. 577:18–578:23, 579:4–10 (DuBridge), 199:11–200:4 (Arendt).

                                               91
molecule designs—over 750 to date—all employ the split scFv design.410 Showing

that an inducible T cell engager invented after the spinout can fall outside

Millennium’s understanding of the Maverick Field, however, cannot reasonably be

taken to mean that Millennium shared a narrow understanding of the Maverick Field.

At the time of negotiations, all of Harpoon’s designs utilized the split scFv design.411

Arendt and DuBridge testified that they believed the Maverick Field encompassed

other approaches to conditionality known at that time.412 And Maverick had a good

reason not to depart from the split scFv design following the spinout: namely, it

worked. Having taken an unproven concept and created a functional molecule, there

would be little motive to immediately move on to new designs.

          “T cell engager of the ‘Maverick’ design.” Fifth, in the final days before

signing the ATA, Evnin and Guenot created deal summaries describing the Maverick

Field as conditionally active T cell engagers of the “Maverick design.”413 Harpoon

410
Id. at 518:21–519:1, 588:11–589:10 (DuBridge). Harpoon also points to Millennium’s
presentations at Takeda pre-spinout and notes that their descriptions of the technology all describe
the split scFv design. See JX 262, at 8–9; JX 583, at 5–7; JX 1017, at 5, 6–7, 17, 25, 29; see also
JX 171, at 2. Given that the initial ProTriTAC design was the sole then-current basis of Harpoon’s
inducible platform, it is hardly surprising that presentations and descriptions of the technology
described that design. Millennium has pointed to other presentations and communications that
indicate it intended to modulate and expand beyond that design. See JX 155; JX 187, at 49; Tr.
42:22–44:2, 44:23–45:21 (Arendt), 526:18–527:5 (DuBridge).                Moreover, even in the
presentations delivered to Takeda, the slides clearly stated, that Harpoon “would be prohibited
from working on the inducible T-cell engagers.” JX 583, at 5.
411
      Tr. 144:22–147:24 (Arendt), 386:1–13 (Hurff).
412
Id. at 606:24–609:6 (DuBridge), 212:5–213:20 (Arendt).
413
      JX 550, at 1; JX 556, at 1.

                                                92
argues that the Plaintiffs’ failure to probe the meaning of these two words

demonstrates that the recipients shared the understanding that the “Maverick Field”

was limited to a “Maverick design” that, in turn, was limited the “split scFv” or “split

dimer” design.414 But this is a tautology; if Harpoon wanted the words “Maverick

design” to clarify its understanding of the Maverick Field after months of silence,

then it needed to do more. Without clarifying that the “Maverick design” is a

limitation, these words simply state that the Maverick Field encompasses molecules

of the design described in the Maverick Field. If Millennium believed—as I find it

did—that Maverick’s design encompassed virtually all known conditionally active

T cell engagers, then specifying that the Maverick Field is limited to the “Maverick

design” does not narrow the Maverick Field.

          In addition, I note that it was soon-to-be Maverick personnel, not Millennium,

who received these deal summaries, and so using these emails as evidence of

Millennium’s understanding would be improper.415 Soon-to-be Maverick CSO

414
      Harpoon Opening Brief, at 44–46.
415
    Harpoon does not argue that this evidence should weigh against Millennium, only contending
that it impeaches the testimony of Maverick’s personnel. See Harpoon Opening Brief, at 42–46.
Similarly, Harpoon says that the parties’ shared understanding is evident because it gave
presentations and sent slide decks to certain Maverick Board members post-spinout that should
have alerted them to its work in the inducible T cell space, and no one objected. See JX 614, at
37–39; JX 1109, at 9; JX 1111. The evidence does not suggest that Maverick personnel attended
the presentations, reviewed the slides, or, if they did, that they should have understood that
Harpoon was engaging in competitive work. Moreover, Harpoon does not contend it shared any
of this with Millennium.

                                              93
Gerber and Maverick Board member Geesaman—who received these emails—

testified that they “blew past” or “ignored” these words because they were so vague.

It not reasonable to conclude, as Harpoon does, that the reason Gerber and Geesaman

were unconcerned was because using the language “of the ‘Maverick’ design”

comported with their understanding that their new company was limited to the split

scFv approach to conditionality. Evnin and Guenot never used the term “Maverick

design” elsewhere, and they also never used the terms “split scFv” or “split dimer”

in negotiations.416 If Gerber and Geesaman had probed the meaning of “Maverick

Design,” the parties may have been forced to clarify their understandings about the

Maverick Field and the spinout, but their failure to do so does not demonstrate a tacit

agreement as to Maverick’s scope, and it certainly does not do so with regard to

Millennium.

          Harpoon put great weight on the evidence I have reviewed in depth, above. It

argued that from these statements and this behavior, I should conclude that

Millennium understood that it was investing in a specific design of a conditionally

active molecule, and that it also understood that Harpoon was free to compete if it

could come up with another design outside this limited scope.417            Harpoon’s

416
   Tr. 78:13–79:10, 198:17–199:5 (Arendt), 450:6–15 (Geesaman), 532:11–533:1 (DuBridge),
1224:1–1225:10, 1261:21–1262:3 (Evnin), 1382:7–11, 1388:13–20 (Gerber), 1351:24–1352:3
(Hostetler); Guenot Depo. Tr. 21:18–25.
417
      Harpoon Opening Brief, at 51–57.

                                           94
interpretation of the evidence is strained. Each piece is either inconclusive or it

supports the idea that Millennium was attempting to negotiate for—and thought it

succeeded in negotiating for—a broad ring-fence around the conditionally active

platform.       The contemporary statements and presentations by Maverick and

Millennium, and the credible testimony of several of their witnesses at trial,

particularly Arendt and DuBridge, corroborate this interpretation of the evidence.

          As a final note on this point, the access Millennium permitted to Evnin and

Baeuerle post-spinout also supports the idea that Millennium believed Maverick to

be working free from the threat of competition from Harpoon. Arendt credibly

testified that neither Maverick nor Millennium would have allowed access to

confidential information if they knew that Harpoon intended to contemporaneously

develop a molecule with a similar function that would directly compete with the

COBRA molecule.418 Even Evnin admitted at trial that allowing such access to a

board member of a direct competitor would be “unusual.”419 I would describe it as

“inexplicable.”

          In the aftermath of the SITC Poster revelation, when Maverick’s CEO

Scibetta confronted Evnin about the ProTriTAC molecule, their divergent

perspectives on the Maverick Field, and Harpoon’s status as a competitor, Scibetta

418
      Tr. 417:23–418:8, 419:9–14 (Hurff), 74:2–19 (Arendt).
419
Id. at 1267:12–1269:17 (Evnin).

                                                95
testified that Evnin told him it was “too bad Takeda’s lawyers missed that in

drafting.”420 After months of silence regarding its understanding of the Maverick

Field, and after its active concealment of its intent to compete, Harpoon appeared to

confirm that Millennium “missed” something when it failed to comprehend the

limits Harpoon embedded in the ATA’s definition of the Maverick Field.

                            ii. Despite the Plain Meaning of the Maverick Field,
                                Millennium Reasonably Believed the Maverick Field
                                was Broad

       Having found earlier in this Opinion that the Maverick Field definition is

unambiguous and cannot reasonably be interpreted to include the ProTriTAC

molecule, I nonetheless find that Millennium reasonably believed when it engaged

in negotiations of the Maverick Field definition and entered the Collaboration and

Warrant Agreements with Maverick that that definition encompassed the inducible

space. As I noted earlier, proving justifiable reliance in the face of an unambiguous

contract is a steep hill to climb. For the reasons described below, I find that in this

unique context, Millennium has offered evidence demonstrating that despite the

unambiguous contractual language between Harpoon and Maverick, it justifiably

relied on Harpoon’s false representations.

420
Id. at 916:18–917:24, 956:1–24 (Scibetta); JX 983 (Scibetta’s corresponding contemporaneous
notes confirming Evnin’s statement).

                                             96
          As a preliminary matter, the fact that the Maverick Field has a plain meaning

does not mean that it has a simple meaning, or one that is easy to apprehend. The

Maverick Field definition is highly technical and concerns scientific concepts.

Despite the scientific training of those involved, failure to apprehend the plain

meaning of a definition of a conditionally active T cell therapy platform that

describes multi-specific antigen-binding molecules is not the same as, say, failure to

apprehend contract terms for the sale of a used car, or even the sale of a mundane

corporate entity. Millennium’s failure to comprehend a contract I found difficult,

yet unambiguous, does not conclusively show that Millennium walked blindly into

its agreements with Maverick or failed to undertake reasonable diligence in

ascertaining the meaning of the Maverick Field.421 This is so for several reasons.

          First, as Harpoon itself stresses, Millennium was not a party to the ATA.422

As described in the factual recitation, the contractual posture was odd: prior to the

spinout, the same Harpoon personnel who are now Defendants also represented and

negotiated on behalf of Maverick.423 Thus, while Millennium commented on,

approved, and negotiated various terms in the ATA—including the Maverick

421
    See Paron Capital Mgmt., LLC v. Crombie, 2012 WL 2045857, at *7 (Del. Ch. May 22, 2012),
aff’d, 62 A.3d 1223 (Del. 2013).
422
      Harpoon Opening Brief, at 47–48.
423
   See Tr. 1094:24–1095:4 (Evnin); Guenot Dep. Tr. 180:11–12 (“The Maverick deal team is . . .
the same as the Harpoon deal team.”).

                                             97
Field—it was not a party to that contract, and was, per explicit contractual terms, not

an intended beneficiary thereof, and it was not negotiating on behalf of the not-yet-

existent company, Maverick. It was Harpoon’s Guenot, not anyone at Millennium,

who ultimately signed the ATA for Maverick.424 As a result, Harpoon felt no need,

legally or practically, to discuss or reveal its contractual intent with Millennium.425

Harpoon, in fact, has maintained a joint privilege between itself and Maverick for

the entirety of this litigation to protect communications that conveyed the contractual

intent that existed between the parties to the ATA—Harpoon and Maverick. In other

words, while Millennium was intimately involved in contract negotiations, Harpoon

kept it at arm’s length when it came to contract communications. Had Millennium

been a party to the ATA, Harpoon might have divulged more of its intent regarding

the “simple and clear” meaning it claimed that Harpoon and Maverick shared.426

          Second, the evidence leads me to two pertinent factual findings. The first is

that Harpoon was aware that Millennium thought it was investing in a company with

rights to a broad field encompassing inducible T cell engagers free from

424
      See JX 1.
425
      See Harpoon Opening Brief, at 12–18.
426
   See JX 238, at 1. Harpoon argues that its attorney Hostetler’s descriptions of the Maverick
Field definition as “simple and clear” conclusively demonstrate the lack of fraudulent intent.
Harpoon Opening Brief, at 62. This demonstrates that Harpoon, internally, found the language
accomplished what it wanted; it does not speak to how Harpoon then acted in its negotiations and
dealings with Millennium, or the reasonableness of Millennium’s reliance thereon.

                                              98
competition.427 The next is that Harpoon, with clear contractual intent internally,

felt that it could nonetheless keep Millennium’s misunderstanding intact and thereby

avoid reopening contract negotiations.428        I conclude from these findings that

Harpoon itself believed it was possible to create a binding contract based on a

carefully nurtured misunderstanding by a non-party to that contract.

          Third, as discussed above, the evidence in negotiations shows that Millennium

realized the Maverick Field might be narrow, and it reacted by negotiating changes

it believed returned the Maverick Field to a broad field definition it had first

conceived.429 Originally, the Maverick Field only encompassed molecules that

targeted CD3, the most popular T cell target.430 When the parties contemplated

licensing back all of the Maverick IP to Harpoon for work outside the Maverick

Field, Millennium realized that Harpoon could simply replicate a T cell engager with

a different immune effector target.431 Understandably, Millennium’s focus zeroed

in on this part of the Maverick Field. The correspondence in evidence supports the

conclusion that when Millennium expanded the definition from CD3 to the defined

term “Immune Effector Target,” it believed that this expansion created a ring-fence

427
      See Section II.B.1.a–b, supra.
428
      See Section II.B.1.a, supra.
429
      See JX 433; JX 426; JX 445.
430
      See JX 433.
431
      See JX 445, at 3.

                                            99
around inducible T cell engagers.432 In other words, with its focus on “Immune

Effector Targets,” and its belief from communications with Harpoon that Maverick

was getting a broad field, Millennium may reasonably have failed to probe other

facets of the intractable but nonetheless unambiguous descriptions in the Maverick

Field.

          Fourth, also discussed above, as of the time of the spinout, the Maverick Field

encompassed all existing conditionally active T cell engagers so far as Millennium

knew.433 Only after the spinout did Harpoon invent (or finish inventing) TetraTAC

and the new ProTriTAC, causing Millennium to discover that the Maverick Field

was not in fact all-encompassing.434 Inducible T cell engagers, however, were a new

concept when Harpoon began developing its initial ProTriTAC.                       Millennium

witnesses credibly testified they believed the Maverick Field captured other

inducible platforms being developed at competing companies.435                    Thus, while

Millennium could have negotiated for a more plain-spoken field definition, it was

432
    Compare id. at 3 (Arendt noting that a definition limited to CD3 did not encompass all T cell
engagers, and that “defin[ing] the field as T cell engagement, not just CD3 engagement” would
“preclude any inducible platform to Harpoon for T-cells, not just CD3”) with ATA § 1.56
(finalized Maverick Field, with “CD3” replaced by defined term “Immune Effector Target”).
433
   See Tr. 606:24–609:6 (DuBridge), 209:9–210:7, 213:13–20 (Arendt). This included existing
molecules designed by CytomX, Amunix, and Genetech. Tr. 69:17–24, 209:21–210:1, 213:13–
20 (Arendt), 551:24–554:1, 548:16–549:22, 556:20–557:3, 608:20–609:6 (DuBridge).
434
Id. at 577:18–578:23, 579:4–10 (DuBridge), 199:11–24 (Arendt).
435
Id. at 606:24–609:6 (DuBridge), 213:13–20 (Arendt).

                                               100
not unreasonable, given the contract language and the state of immunotherapy, for it

to rely on its broad understanding of the Maverick Field.

          As a final note, Baeuerle testified that at the time of the spinout, his ideas for

alternative methods of achieving conditionality—what would become TetraTAC—

were “science fiction” concepts that never even approached workability.436 Lin

described his discovery of conditionality through peptide masks on the albumin

binding domain as a “serendipitous eureka moment.”437 There is, to my mind, little

reason to fault Millennium for not predicting then-unimaginable molecular concepts

that would draw out the recalcitrant nuances of the Maverick Field definition.

          This has been a long-winded explanation of why I find that Millennium

reasonably believed—and thus justifiably relied on—a misapprehension of an

unambiguous contract between Harpoon and Maverick.                    Millennium helped

negotiate a complex and highly technical definition with Harpoon. Nonetheless,

Millennium was not a party or third-party beneficiary to that contract, and so it is

bringing a tort, not a contract claim. As such, its claim is that it relied on the many

representations that Harpoon made to it during the course of the transaction, not

merely the Maverick Field definition.                 Harpoon shut Millennium out of

communications regarding its intent for the Maverick Field and actively prevented

436
Id. at 1459:24–1460:15, 1531:9–24 (Baeuerle).
437
Id. at 1745:4–15, 1800:3–12 (Lin).

                                               101
Millennium from discovering its misapprehension.                    Harpoon has successfully

demonstrated its understanding of the contract was correct. Thus, it has escaped

contract damages. Nevertheless, and in light of all the evidence proffered, I find it

reasonable to conclude that Millennium reasonably believed that Maverick’s

trajectory and Harpoon’s non-compete were broad despite the lack of ambiguity in

the Maverick Field definition.

                                iii. A Broad Field Definition was a Causal Factor in
                                     Millennium’s Decision to Enter the Collaboration and
                                     Warrant Agreements

          As noted, the mere fact that information was material does not support fraud;

the information must play a causal role in the decision that underlies the fraud

claim.438       Millennium witnesses credibly testified that Takeda would have

considered the investment absurd if it imagined that it was investing in the

intellectual property around a single method or path to conditionality and leaving the

field open to competition from Harpoon.439 Takeda, through Millennium, has

invested tens of millions of dollars in Maverick to date, and plans to invest more.440

438
   Great Hill Equity Partners IV, LP v. SIG Growth Equity Fund I, LLLP, 2018 WL 6311829, at
*33 (Del. Ch. Dec. 3, 2018) (quoting E.I. DuPont De Nemours & Co. v. Fla. Evergreen Foliage,
744 A.2d 457, 462 (Del. 1999)).
439
      Tr. 422:4–423:5 (Hurff); see also JX 451, at 1–4; JX 527-PPT, at 3.
440
    Tr. 926:4–13 (Scibetta) (testifying Millennium invested over $100 million in “nondilutive
financing” for the right to purchase Maverick), 1047:2–16 (Nachtwey) (testifying that Millennium
has made investment payments of $65.25 million through the third quarter of 2019).

                                                102
It would not have done so without the broad “ring fence” around conditionality that

it believed Maverick would enjoy.441

                         e. Millennium’s Damages are Presumed at This Stage

          Damages is the final element of proving a fraud claim. As noted, however, I

indicated at trial that a damages phase would follow, contingent on finding

liability.442 At this point, I assume that Millennium suffered damages in satisfaction

of this element of the tort, subject to proof at an ensuing damages phase.

                  2. Tortious Interference with Business Relations and with Contract

          Millennium makes an argument that Harpoon interfered with its contractual

and business relationships with Maverick.                 Tortious interference with contract

requires (1) a contract, (2) the defendant’s knowledge of the contract, (3) intentional

interference with the contract without justification, (4) causing termination or

breach, and (5) damage.443 Here, a contract existed because Millennium entered the

Collaboration and Warrant Agreements with Maverick.                           Harpoon, given its

involvement in negotiations, clearly knew of these contracts. However, even if

Harpoon interfered, Millennium has not demonstrated that Harpoon’s actions caused

a termination or a breach of the Collaboration or Warrant Agreements. Although

441
      See JX 426, at 1 (Hurff noting, “[f]or this investment we need full IP”).
442
      Tr. 1980:12–1981:7.
443
      Cryovac Inc. v. Pechiney Plastic Packaging, Inc., 430 F. Supp. 2d 346, 357 (D. Del. 2006).

                                                  103
Millennium claims that Harpoon’s actions “resulted in a Material Adverse Change”

that constitutes a breach, it offers no evidence to support this.444 Therefore, I find

Harpoon is not liable for tortious interference with contract.

          Tortious interference with business relations requires (1) reasonable

probability of a business relationship or expectancy, (2) intentional interference with

the relationship or expectancy, (3) causation, and (4) damages, examined in light of

a privilege to lawfully compete.445 Here, Millennium had a reasonable probability

of a business relationship through its Collaboration and Warrant Agreements with

Maverick. There is no evidence, however, that Harpoon intentionally interfered with

Millennium and Maverick’s business relationship. Even though, as I found, Harpoon

fraudulently induced Millennium to enter the contracts with Maverick, Harpoon’s

actions in developing the ProTriTAC molecule were not aimed at—and did not

disrupt—Maverick’s ability to develop conditionally active T cell engagers,

Millennium’s ability to fund Maverick, or Millennium’s option to purchase

Maverick. While the advent of a new competitor in the market may have changed

the prospects of success, there is no evidence that Harpoon intentionally interfered

with the business relationship between Maverick and Millennium, which is

444
   Corrected Post-Trial Br. of Millennium Pharmaceuticals, Inc., D.I. 316 (“Millennium Opening
Brief”), at 68.
445
      Lipson v. Anesthesia Serv., P.A., 790 A.2d 1261, 1285 (Del. Super. 2001).

                                                104
circumscribed by the Collaboration and Warrant Agreements. Although the new

competition changes the competitive landscape, Maverick’s funding remains intact,

and Millennium retains the option to purchase.446 Therefore, Harpoon is not liable

for tortious interference with business relations.

                 3. Unfair Competition

          Millennium also contends that Harpoon has unfairly competed with it or with

Maverick. The elements for unfair competition are (1) a reasonable expectancy of a

business relationship, (2) defendant’s wrongful interference with that relationship,

and (3) defeat of the expectancy and harm.447 In evaluating tortious interference

with business relations above, I found that there was no wrongful interference with

the business relationship that exists between Millennium and Maverick. There is no

proof of interference with Maverick’s or Millennium’s trade with any third party;

which, given current technology, would appear not to be possible. Thus, the second

prong of the claim for unfair competition is not met, and Harpoon is not liable for

this tort.

                 4. Unjust Enrichment

          Unjust enrichment is an equitable concept, unavailable if a legal remedy

exists. Millennium has pled unjust enrichment in the alternative if no tortious

446
      Tr. 1050:16–1051:19 (Nachtwey).
447
      Ethpharm S.A. France v. Abbott Labs., 598 F. Supp. 2d 611, 618 (D. Del. 2009).

                                               105
conduct is demonstrated.448 Having found that Millennium proved fraud on the part

of Harpoon, Millennium has a remedy at law and the unjust enrichment claim falls

away.449

                                     III. CONCLUSION

          Maverick has not proved its claims against Harpoon for breach of contract or

misappropriation of trade secrets, and those claims are dismissed. Millennium has

proved liability for fraud by Harpoon. Millennium has not proved its claims for

tortious interference with contract and business relations or unfair competition, and

those claims are dismissed along with unjust enrichment, pled in the alternative. The

parties should confer and inform the Court about proceeding to a determination of

damages for Harpoon’s fraud liability and should provide an appropriate form of

order consistent with this Memorandum Opinion.

448
      Millennium Opening Brief, at 71.
449
    Millennium Opening Brief, at 71 (“Takeda concedes that if it prevails on its other claims, it has
a remedy at law; this claim is therefore presented in the alternative.”).

                                                106