United States District Court, D. Massachusetts
MEMORANDUM OF DECISION
ZOBEL SENIOR UNITED STATES DISTRICT JUDGE.
2015, Sinotau Pharmaceutical Group (“Sinotau”)
and Navidea Biopharmaceuticals, Inc. (“Navidea”),
executed a Binding Term Sheet involving an exclusive license
to NAV4694, a pharmaceutical imaging agent. In this lawsuit,
Sinotau alleges that Navidea breached its contractual
obligations to Sinotau by refusing to abide by the
parties' agreement (Counts I and II) and that Navidea
tortiously interfered with Sinotau's advantageous
prospective business relationships (Count III). Sinotau also
brings alternative claims of promissory estoppel, breach of
the implied covenant of good faith, and failure to use best
efforts (Counts IV, V, and VI). Navidea has moved to dismiss
all claims. See Docket # 17.
facts are alleged in the plaintiff's amended complaint
(Docket # 16). See Ocasio-Hernández v.
Fortuño-Burset, 640 F.3d 1, 5 (1st Cir. 2011).
holds an exclusive license that covers patent rights to
NAV4694, a pharmaceutical imaging agent owned or controlled
by AstraZeneca AB (“AZ”). Under an agreement
entered into by Navidea's predecessor (the
“Navidea-AZ License Agreement”), Navidea owns the
transferrable right to manufacture, develop, and
commercialize NAV4694. Between the end of 2014 and the
beginning of 2015, Navidea approached Sinotau about assuming
Navidea's worldwide license of NAV4694. In early 2015,
Sinotau and Navidea began negotiating terms of the
anticipated NAV4694 worldwide license agreement.
March 2015, the parties signed a “Binding Term Sheet
for Exclusive License” (“Binding Term
Sheet”), under which Navidea agreed to grant Sinotau an
exclusive license to NAV4694 subject to the
“re-negotiation of the Navidea-AZ License Agreement to
include economic terms acceptable to [Sinotau] as specified
in the ‘Updated Proposal for Worldwide Licensing of
NAV4694' forwarded by [Sinotau] to [Navidea] on March 4,
2015." Docket # 16 ¶ 68 (alterations in original)
(quoting the Binding Term Sheet).
signing the Binding Term Sheet, Sinotau and Navidea exchanged
draft licensing agreements. During this time, Navidea tried
to renegotiate the material terms in the Binding Term Sheet.
Sinotau claims that it “entertained Navidea's
proposed modifications” but that the “parties
never reached final agreement as to a proposed modification
to the Binding Term Sheet.” Docket # 16 ¶¶
116, 119. Sinotau sent Navidea an exclusive license agreement
on June 23, 2015, that included material terms from the
Binding Term Sheet as well as additional terms and conditions
Navidea had proposed. Navidea did not sign this license
agreement nor any other exclusive license agreement with
Sinotau. Sinotau alleges several reasons why Navidea
“wanted to back away from the deal it had struck,
” including that it had “entertained at least one
proposal from a Sinotau competitor that surpassed the
economic terms set forth in the Binding Term Sheet” and
that clinical results for a related drug increased
NAV4694's perceived value. Docket # 16 ¶¶
August 2015, Sinotau filed the present suit, and in October
2015, it amended its complaint. Navidea now moves to dismiss
the amended complaint.
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Id.
purposes of a motion to dismiss, the court accepts all
well-pleaded factual allegations as true and draws all
reasonable inferences in the plaintiff's favor. See
Rodríguez-Reyes v. Molina-Rodríguez, 711
F.3d 49, 52-53 (1st Cir. 2013). In addition to facts and
documents included in or incorporated into the complaint, the
court “may also consider ‘documents incorporated
by reference in [the complaint], matters of public record,
and other matters susceptible to judicial notice.'”
Giragosian v. Ryan, 547 F.3d 59, 65 (1st Cir. 2008)
(alteration in original) (quoting In re Colonial Mortg.
Bankers Corp., 324 F.3d 12, 20 (1st Cir. 2003)).
Choice of Law
parties disagree whether Massachusetts or Delaware law should
apply to Sinotau's contract and tort claims. Federal
courts sitting in diversity, as here, apply state substantive
law. See Crellin Techs., Inc. v. Equipmentlease
Corp., 18 F.3d 1, 4 (1st Cir. 1994) (citing Erie
R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938)). “In
determining what state law pertains, ...