United States District Court, D. Massachusetts
MEMORANDUM AND ORDER AWARDING PREJUDGMENT AND
ALLISON D. BURROUGHS U.S. DISTRICT JUDGE
CardiAQ Valve Technologies, Inc. (“CardiAQ”)
brought this suit against Defendant Neovasc Inc.
(“Neovasc”) in June 2014. On May 19, 2016,
following a two-week trial, a jury found for CardiAQ as to
some, but not all, of its claims, and awarded CardiAQ $70,
000, 000 in damages for Neovasc's theft of trade secrets.
On October 31, in an order resolving several post-trial
motions, the Court partially granted CardiAQ's motion for
enhanced damages and awarded an additional $21, 000, 000.
[ECF No. 583]. The Court also granted in part CardiAQ's
motion for injunctive relief and denied Neovasc's motions
for a new trial. Judgment was entered on November 21, 2016.
[ECF No. 598]. In order to stay the judgment pending appeal,
Neovasc agreed to post a $70 million bond and granted CardiAQ
a security interest in its remaining property up to the
amount of the judgment. [ECF Nos. 663, 663-1, 668, 668-1].
entry of judgment, the Court indicated that CardiAQ appeared
to be entitled to prejudgment interest, but allowed the
parties to brief the issue, as requested by Neovasc.
Following the entry of Neovasc's notice of appeal, the
Court also requested briefing concerning its jurisdiction to
award prejudgment interest. [ECF No. 635]. CardiAQ submitted
a brief arguing that the Court retains jurisdiction to award
prejudgment interest, accompanied by a motion pursuant to
Fed.R.Civ.P. 59(e) [ECF Nos. 638, 639], and Neovasc did not
dispute the Court's jurisdiction.
before the Court is CardiAQ's motion to amend the
judgment to include prejudgment and postjudgment interest
[ECF No. 639], which Neovasc has opposed [ECF No. 610]. For
the reasons set forth below, CardiAQ's motion is allowed,
and the judgment is modified to award CardiAQ $20, 675, 154
in prejudgment interest and $2354.27 per day in postjudgment
interest from entry of judgment until judgment is satisfied.
argument that CardiAQ is not entitled to prejudgment interest
is primarily based on the contention that the jury's
award depended on future events and reflected the value of
CardiAQ's damages as of February 2015, about eight months
after the suit was filed. Prejudgment interest awarded
pursuant to Mass. Gen. Laws ch. 231, § 6B is intended to
compensate the prevailing party for the loss of use of money
while the lawsuit is pending. See Conway v. Electro
Switch Corp., 523 N.E.2d 255, 258 (Mass. 1988). In
contrast to damages incurred prior to the filing of the
lawsuit, courts have generally held that there is no basis to
award prejudgment interest on damages that accrue after the
suit is commenced. USM Corp. v. Marson Fastener
Corp., 467 N.E.2d 1271, 1282 (Mass. 1984); see also
Casual Male Retail Grp., Inc. v. Yarbrough, 527
F.Supp.2d 172, 181 (D. Mass. 2007). Neovasc asserts that
prejudgment interest is not appropriate in this case because
CardiAQ's expert did not discount the February 2015
royalty calculation to the date the lawsuit began, or to the
date of the hypothetical negotiation in March 2010.
focuses on the testimony of CardiAQ's damages expert,
Michael Wagner, but it has not discussed the jury
instructions or the actual damages award. The jury was
instructed that if it found for CardiAQ on any of its claims
for trade secret misappropriation, it was to determine
damages under a reasonable royalty standard. Tr. Day 13,
170:6-8. The Court explained that, under the reasonable
royalty standard, the jury had to decide the amount that
CardiAQ would have been willing to accept and that Neovasc
would have been willing to pay if the parties had engaged in
a hypothetical arms-length negotiation for the information
before the misappropriation occurred. Id.
at 170:8-13. The jury was instructed that it could take into
account a number of factors to determine this amount, drawn
from the decision in Georgia-Pac. Corp. v. U.S. Plywood
Corp., 318 F.Supp. 1116, 1121 (S.D.N.Y. 1970). Tr. Day
13, 170:18- 171:16. The jury ultimately concluded that
CardiAQ should receive $70 million in damages for
Neovasc's misappropriation of trade secrets. [ECF No.
are presumed to follow their instructions. CSX Transp.,
Inc. v. Hensley, 556 U.S. 838, 841 (2009);
O'Rourke v. City of Providence, 235 F.3d 713,
733 (1st Cir. 2001). The Court must assume that the
jury's award reflects the amount the jury believed that
Neovasc would have paid CardiAQ in a hypothetical negotiation
that occurred in 2010, well before this lawsuit was filed.
Furthermore, the jury's award differed from Mr.
Wagner's damages estimate in that Mr. Wagner testified
that the February 2015 value of the damages was $90 million,
Tr. Day 8, 16:21-17:3, 28:4-16, whereas the jury awarded $70
million. The verdict form did not provide the jury the
opportunity to offer any reasoning for its decision, and the
Court declines to speculate as to how or why the jury arrived
at the damages figure that it did. Thus, regardless of any
concern on Neovasc's part as to the discounting applied
by Mr. Wagner, that figure was only one piece of evidence
that could have informed the jury's decision. The jury
concluded that CardiAQ should have received $70 million in
2010, and CardiAQ is therefore entitled to prejudgment
interest on that figure.
offers two additional arguments against an award of
prejudgment interest, neither of which are convincing. First,
Neovasc contends that the jury intended its award to provide
complete compensation to CardiAQ, and that because CardiAQ
did not inform the jury that interest might be added to the
verdict later, it is foreclosed from asking for interest now.
Neovasc cites no authority indicating that informing the jury
of the availability of prejudgment interest is mandatory.
Instead, the statute authorizing prejudgment interest
contemplates it to be an automatic award which can be added
by the clerk of court. See O'Malley v.
O'Malley, 645 N.E.2d 684, 686 (Mass. 1995)
(prejudgment interest attaches automatically); Mendoza v.
Union St. Bus Co., 876 F.Supp. 8, 12 (D. Mass. 1995)
(“prejudgment interest under § 6B is to be added
ministerially after the verdict”). There may be certain
cases that call for an exception to this rule, but the Court
does not find that this is such a case. The jury was
instructed that the damages award should reflect what Neovasc
would have paid in 2010, not what CardiAQ should receive
today, and there is no reason to believe the jury strayed
from that instruction.
Neovasc contends that an award of prejudgment interest would
constitute a windfall. Again, this argument is premised on
the idea that the jury's award reflected a 2015 damages
calculation, not a 2010 damages calculation, as the jury was
instructed. Thus, there is no reason to believe that an award
of prejudgment interest would constitute a windfall. Instead,
such an award will fulfill the intended purpose of §
6B-to compensate CardiAQ for its inability to use the money
that Neovasc should have paid it in 2010.
CardiAQ is entitled to $20, 675, 154 in prejudgment interest.
The Court calculates the award as follows (given that there
were 899 days between June 6, 2014 and November 21, 2016, and
there are 365.25 days per year): ($70, 000, 000 * 0.12 * 899)
/ 365.25 = $20, 675, 154.
has not disputed CardiAQ's request for postjudgment
interest. The Court thus finds that CardiAQ is entitled to
postjudgment interest on the $70 million jury verdict, the
$21 million in enhanced damages, and the $20, 675, 154
prejudgment interest award. See Mill Pond Assocs., Inc.
v. E & B Giftware, Inc., 751 F.Supp. 299, 303 (D.
Mass. 1990) (“The First Circuit clearly rejected the
argument that a judgment should be parceled into component
parts of which only some of the parts would be entitled to
post judgment interest.”). The postjudgment interest is
calculated “from the date of the entry of the judgment,
at a rate equal to the weekly average 1-year constant
maturity Treasury yield, as published by the Board of
Governors of the Federal Reserve System, for the calendar
week preceding  the date of the judgment.” 28 U.S.C.
§ 1961(a). For the week of November 14, 2016, that rate
on a total award of $111, 675, 154 (jury verdict, enhanced
damages, and prejudgment interest), the Court calculates
postjudgment interest as follows: ($111, 675, 154 * 0.0077) /
365.25. Therefore, CardiAQ is entitled to postjudgment
interest of $2354.27 ...