United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
J. Casper, United States District Judge
Keisuke Suzuki (“Suzuki”) has filed this lawsuit
against Defendant Abiomed, Inc. (“Abiomed”)
alleging a breach of the implied covenant of good faith and
fair dealing and claims for promissory estoppel or quantum
meruit. D. 1. Defendant has moved to dismiss. D. 10. For the
reasons stated below, the Court DENIES the motion.
Standard of Review
survive a Rule 12(b)(6) motion to dismiss, the factual
allegations in a complaint must “possess enough
heft” to state a claim to relief that is plausible on
its face. Bell Atl. Corp. v. Twombly, 550 U.S. 544,
557 (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.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing
Twombly, 550 U.S. at 556). The court must
“isolate and ignore statements in the complaint that
simply offer legal labels and conclusions or merely rehash
cause-of-action elements.” Schatz v. Republican
State Leadership Comm., 669 F.3d 50, 55 (1st Cir. 2012).
A complaint does not need detailed factual allegations, but
“[t]hreadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not
suffice.” Iqbal, 556 U.S. at 678. The court
must then “take the complaint's well-[pleaded]
(i.e., non-conclusory, non-speculative) facts as
true, drawing all reasonable inferences in the pleader's
favor, and see if they plausibly narrate a claim for
relief.” Schatz, 669 F.3d at 55.
“Plausible, of course, means something more than merely
possible, and gauging a pleaded situation's plausibility
is a ‘context-specific' job that compels [the
Court] to draw on' [its] ‘judicial experience and
common sense.” Id. (internal citations
all factual allegations in the complaint as true, as required
at this stage, the Court considers the following facts.
Abiomed is a publicly traded company that is a leading
provider of temporary mechanical circulatory support
devices-also known as “heart pumps.” D. 1 ¶
7. The specific line of heart pumps that Abiomed develops,
manufactures and markets is called “Impella.”
Id. In the years relevant to this complaint, Abiomed
sought to expand the use of, and gain regulatory approval
for, its Impella line of products and was particularly
interested in obtaining regulatory approval for Impella's
sale in Japan. Id. ¶ 8.
has worked as a manager or director in the medical device
field since 1998. Id. ¶ 6. From 1998 until
2006, he worked in Japan at Guidant Japan, K.K.
(“Guidant”), a Japanese subsidiary of a large
medical device company. Id. In or about January
2007, Suzuki left Guidant and established Kaye Suzuki Device
Consulting, LLC (“Suzuki Consulting”), which
provided consulting services to companies seeking to
introduce medical devices into the Japanese market.
Id. ¶ 9. One of Suzuki Consulting's clients
was Abiomed and Suzuki provided consultation services
relating to its seeking approval in Japan of its Impella line
of heart pumps. Id. ¶ 10. As the principal of
Suzuki Consulting, Suzuki alleges that he earned
approximately $500, 000 per year. Id. ¶ 12.
2009, Suzuki and Abiomed's CEO Michael Minogue
(“Minogue”) and its Vice President of Healthcare
Solutions Andrew Greenfield (“Greenfield”) began
discussing the possibility of Suzuki shutting down his
consulting business and becoming a full-time employee at
Abiomed. Id. ¶ 13. At the time, Abiomed was not
particularly profitable and both Minogue and Greenfield had
made clear that they wanted to minimize Abiomed's
expenses. Id. Although Suzuki informed Minogue and
Greenfield that he made $500, 000 per year at his consulting
company, he indicated that he would be willing to sacrifice
his short-term base salary for long-term incentive
April 1, 2010, Abiomed made a written offer of employment
(“Offer Letter”) to Suzuki for the position of
Vice President of Asia with an annual salary of $250, 000, an
annual bonus of up to $100, 000 and a commission opportunity
of up to $1 million. Id. ¶ 14. Additionally,
the Offer Letter reflected that Suzuki would be awarded up to
45, 000 shares of Abiomed common stock which would be
contingent on meeting three benchmarks. Id.
¶¶ 14, 17. Specifically, (1) a performance share of
10, 000 shares of Abiomed's stock would issue upon the
successful submission of an application to Japan's
Pharmaceutical and Medical Device Agency (“PMDA”)
for Impella use in Japan; (2) a performance share of 20, 000
shares of Abiomed's stock would issue when Japan's
Ministry of Health, Labor, and Welfare approved Impella for
general use; and (3) a performance share of 15, 000 shares of
Abiomed's stock would issue “when Approval for
targeted reimbursement level of Impella is gained.”
Id. ¶ 17. The Offer Letter further stated that
the performance share awards “require that you continue
to be employed by the Company on the date that any of these
milestones are achieved . . . ” and that “[o]nce
approval is gained for Impella General Use in Japan and
provided that you remain and are qualified to be employed in
the Commercial leadership role, we will present to you a
commission structure.” Id. ¶ 16. On or
about April 9, 2010, Suzuki terminated his consulting
business and moved from Japan to Massachusetts to begin
working as Vice President at Abiomed. Id.
¶¶ 18-22. On April 10, 2010, Suzuki signed an
Employment, Nondisclosure, and Non-Competition Agreement (the
“Nondisclosure Agreement”). Id. ¶
23. The Nondisclosure Agreement stipulated that after six
months of employment, Abiomed could terminate Suzuki without
cause upon 28 days' written notice or with cause at any
time. D. 1-4 at 1.
April 29, 2010, in accordance with the Offer Letter, Abiomed
granted Suzuki three awards of performance shares, none of
which would vest or issue until the achievement of the
specific goals outlined in the letter. D. 1 ¶ 27. By
March 31, 2011, Suzuki had met the first milestone under the
Offer Letter and Abiomed issued him 10, 000 shares of common
stock. Id. ¶ 39. At the time, the stock was
trading at $14.53 per share and the total value to Suzuki was
$145, 300. Id.
alleges that while he continued working on getting the
Impella line of devices approved for general use in Japan,
Abiomed refused to devote the resources necessary to achieve
such a result. Id. ¶¶ 40-43. For example,
PMDA invited Abiomed to a “kick-off” meeting in
June 2011 where it presented Abiomed with hundreds of
questions that it wanted answered by September 2011.
Id. ¶ 40. Despite this deadline, Abiomed failed
to answer the questions until a year later. Id.
¶ 41. Moreover, Abiomed continued to be consumed by
fixing various problems identified in the Impella device.
Id. ¶ 42. Because no other Abiomed employees,
with the exception of Minogue, had compensation incentives
tied to gaining approval in Japan, expansion to the Japanese
market was not a priority. Id. Nonetheless, Suzuki
continued working on obtaining regulatory approval and also
worked on preparing the Japanese market for entry of the
Impella line. Id. ¶ 44. By March or April 2015,
Suzuki's continued work in Japan paid off and he was able
to secure a meeting between Abiomed's representatives and
officials at the PMDA. Id. ¶ 46. While Abiomed
originally had concerns that Impella would not be approved
without being required to first conduct a costly and
time-consuming human study in Japan, PMDA made clear that no
such study would be mandated. Id. ¶ 47.
Furthermore, PMDA informed Abiomed that it was inclined to
approve the Impella line for general use once it received
updated reports addressing four modifications that the
company had made to the device since it had submitted the
original application. Id.
point, Suzuki alleges that his value to Abiomed decreased
precipitously. Id. ¶ 49. Indeed, following the
meeting with PMDA, Abiomed regarded it as a near certainty
that Japan would approve Impella for general use.
Id. ¶ 48. Suzuki's work had largely paved
the path toward regulatory approval-especially his
shepherding of the application through Japanese regulatory
authorities-and he had also established Abiomed's new
Japanese subsidiary and staffed its office in Japan.
Id. ¶ 50. Abiomed realized that Suzuki's
continued employment through the time of Japan's eventual
approval of Impella's general use would thereby require
it to issue Suzuki the 20, 000 shares called for in the Offer
Letter. Id. ¶ 51. Because Abiomed's stock
value had significantly increased since the time of the
original offer, the 20, 000 shares would be equivalent to a
$1.3 million value, a value that Suzuki alleges was much
greater than Abiomed had planned on paying Suzuki.
Id. Suzuki further contends that, once approval and
reimbursement issued, Abiomed realized he would be entitled
to an additional 15, 000 shares of common stock and eligible
for future commission rights as outlined in the Offer Letter.
Id. ¶ 52. Rather than follow through with the
terms outlined in the Offer Letter, Suzuki alleges that
Abiomed decided to give him a falsely negative job
performance review to lay the groundwork necessary to avoid
the mandatory contractual terms outlined in the letter.
Id. ¶ 55. Furthermore, Abiomed decided to deny
Suzuki his annual bonus and diminish his role in the company.
Id. Prior to this point, Suzuki had never had a
negative job performance review and he always received annual
bonuses of between $80, 000 and $90, 000 per year.
Id. ¶ 56. He had also consistently been given
salary raises each year. Id.
14, 2015, Greenfield met with Suzuki and discussed changing
his duties and compensation structure. Id. ¶
57. Several days later, Greenfield provided Suzuki a proposed
amendment to the Offer Letter in the form of a letter
entitled “Amendment to Offer Letter Dated April 1,
2010” (the “Proposed Amendment”).
Id. ¶ 58. The Proposed Amendment would have
limited Suzuki's duties to Japan, rather than all of
Asia, and would have cancelled the remaining 35, 000
performance shares that would be owed to him under the terms
of the original Offer Letter. Id. ¶ 60.
Instead, Suzuki would receive Restricted Stock Units
(“RSUs”) in lower amounts and at significantly
less value than the performance shares originally promised in
the Offer Letter. Id. Moreover, under the Proposed
Amendment, the change to RSUs would be coupled with a
stipulation stating that Suzuki would not be granted the
shares, but instead would simply have the right to purchase
them in an amount later ...