Ward v. Schaefer ( 2023 )

United States Court of Appeals
For the First Circuit
No. 22-1547
VIRGINIA CORA WARD, as the administratrix of the estate of
EDMUND EDWARD WARD,
Plaintiff, Appellant,
v.
ALPHACORE PHARMA, LLC and BRUCE AUERBACH,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. F. Dennis Saylor, IV, U.S. District Judge]
Before
Rikelman, Selya, and Howard,
Circuit Judges.
Timothy Cornell, with whom Cornell Dolan, P.C. was on brief,
for appellant.
John M. Allen, with whom McCarter & English LLP was on brief,
for appellee AlphaCore.
Mark S. Furman, with whom Emily C. Shanahan and Tarlow, Breed,
Hart & Rodgers, P.C. were on brief, for appellee Auerbach.
December 22, 2023
SELYA, Circuit Judge. This appeal tests the margins of
a court's in personam jurisdiction, consistent with the
constraints of the Due Process Clause, see U.S. Const. amend. XIV,
§ 1, and the Massachusetts long-arm statute, see Mass. Gen. Laws
ch. 223A, § 3. Stripping away unsupported assertions, we uphold
the district court's determination that the appellees, AlphaCore
Pharma, LLC (ACP) and Bruce Auerbach, lacked sufficient contacts
with the forum state to permit the exercise of in personam
jurisdiction.1 Consequently, we affirm the district court's order
of dismissal.
I
We briefly rehearse the relevant facts and travel of the
case. In reviewing a dismissal of a case for lack of personal
jurisdiction based on a prima facie record, we "take the facts
from the pleadings and whatever supplemental filings (such as
affidavits) are contained in the record, giving credence to the
plaintiff's version of genuinely contested facts" and accounting
for "undisputed facts put forth by" the parties. Baskin-Robbins
Because the appellant's claims against ACP and Auerbach
1
raise a discrete set of issues, we will resolve the appellant's
claims against the remaining appellee in a separate and subsequent
opinion. See, e.g., Alston v. Town of Brookline, 997 F.3d 23, 29
n.1 (1st Cir. 2021); United States v. Santiago-Rivera, 744 F.3d
229, 231 n.1 (1st Cir. 2014). Relatedly, we note that this
opinion, which is based upon review of a prima facie record, does
not contain the factual details that will appear in the subsequent
opinion (which deals with claims based on a full trial record).
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Franchising LLC v. Alpenrose Dairy, Inc., 825 F.3d 28, 34 (1st
Cir. 2016). Withal, we do not rely on any "unsupported
allegations." Plixer Int'l, Inc. v. Scrutinizer GmbH, 905 F.3d 1,
6 (1st Cir. 2018).
ACP is a limited liability company, which has its
principal place of business in Ann Arbor, Michigan. In 2013, ACP
was acquired by MedImmune, a subsidiary of AstraZeneca
Biopharmaceuticals, Inc. (AstraZeneca). As of 2012, ACP was the
sole patent licensee of a form of recombinant human
lecithin-cholesterol acyltransferase known as ACP-501.
Auerbach is a citizen and resident of Michigan. He was
a principal of ACP, as well as a corporate officer, until ACP was
acquired by MedImmune.
The decedent, Edmund Edward Ward, was a citizen and
resident of Massachusetts. Ward was born with an extremely rare
genetic deficiency that inhibited him from being able to produce
virtually any cholesterol. As a result, Ward eventually came to
suffer from stage-5 kidney failure.
In 2012, Dr. Ernst Schaefer — Ward's treating physician
in Massachusetts — introduced Ward to Auerbach and to Drs. Robert
Shamburek and Alan Remaley as a potential candidate for ACP-501.
Ward later agreed to participate as the only subject in a long-term
trial of ACP-501. ACP donated the ACP-501 needed for the trial to
the National Institutes of Health (NIH). Despite being diagnosed
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as suffering from kidney failure, Ward postponed dialysis
treatment in order to participate in the trial.
In January of 2013, Ward traveled from his home in
Massachusetts to the NIH facility in Bethesda, Maryland, to begin
treatment. During this initial visit, Ward met with Auerbach, who
allegedly told him that the process would take a long time but
urged him to undergo the full course of the treatment, explaining
that "you will get out of it what you put into it." Auerbach
allegedly boasted that ACP-501 was "most certainly the solution"
to reverse Ward's kidney failure.
Until June of 2013, Ward traveled on a weekly basis from
his home in Massachusetts to the NIH facility in Maryland to
receive injections of ACP-501 and undergo testing (including
multiple blood draws). Beginning in July and continuing through
September of 2013, he journeyed every other week.
As part of the trial, NIH created a clinical protocol
for Ward's treatment. ACP and Auerbach each had a hand in drafting
this protocol, though the record lacks clarity as to the roles
that they played. An early draft of the protocol dated November
20, 2012, provided that, during the first phase of the trial, Ward
would receive ACP-501 injections at the NIH and then, during a
second phase, would receive them in both Maryland and
Massachusetts. The parties dispute whether this iteration of the
protocol became the final operative draft or whether a different
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draft, dated December 3, 2012, superseded it. The later draft did
not provide for any injections of ACP-501 in Massachusetts.2 In
any event, the record makes manifest — and the appellant does not
contest the fact — that all of the ACP-501 injections that Ward
received were administered at the NIH facility in Maryland.
In September of 2013, Ward withdrew from the clinical
trial. His decision to end his participation came after he was
informed that his kidney function was rapidly deteriorating and
that he was in urgent need of dialysis.
We fast-forward to July of 2016. At that time, Ward
filed a complaint against ACP, Auerbach, Schaefer, Shamburek,
Remaley, MedImmune, and AstraZeneca in a Massachusetts state
court. The complaint alleged that Ward had been fraudulently
induced to participate in the clinical trial in order to set the
table for a sale of ACP to MedImmune — a sale that was "based
principally" on the results of his trial. The complaint further
alleged that "the individual defendants, acting in concert, were
ACP shareholders, owned ACP options or warrants, or otherwise
benefited materially from the sale of ACP to [MedImmune, an
AstraZeneca subsidiary] in secret."
2It is undisputed that both drafts of the protocol stipulated
that, during the periods in which Ward was at his home in
Massachusetts, he would be monitored by Dr. Schaefer.
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Ward's state-court action contained a gallimaufry of
claims. One count sounded in fraud, another in lack of informed
consent, and a third in unjust enrichment. Three other counts
alleged an assortment of constitutional, civil rights, and
conspiracy claims.
In short order, the case was removed to the United States
District Court for the District of Massachusetts. See 28 U.S.C.
§ 2679(d)(2). As relevant here, ACP and Auerbach moved to dismiss
their claims for want of in personam jurisdiction. See Fed. R.
Civ. P. 12(b)(2). In support, Auerbach submitted two affidavits
in which he attested that neither he nor ACP had any relevant
contacts with the Commonwealth of Massachusetts. Nor had either
of them — these affidavits declared — supplied any good or service
within the state. Auerbach further attested that all of his and
ACP's activities and communications concerning Ward — including
ACP's involvement in helping the NIH prepare an investigational
new drug application, ACP's donation of ACP-501 to the NIH, his
two meetings with Ward at the NIH in January of 2013, and a brief
telephone call with Ward in September of 2014 — occurred outside
of Massachusetts. Ward neither submitted any counter-affidavits
nor otherwise refuted Auerbach's representations.
The district court granted ACP's and Auerbach's joint
motion to dismiss over Ward's objection. See Ward v. Auerbach,
No. 16-12543, 2017 WL 2724938, at *13 (D. Mass. June 23, 2017).
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First, the court concluded that neither ACP nor Auerbach was
subject to personal jurisdiction in Massachusetts premised on
"their own in-forum contacts." Id. at *10. Next, the court
determined that neither ACP nor Auerbach "regularly transacted or
solicited business, or engaged in any other persistent course of
conduct, or derived substantial revenue from goods used or consumed
or services rendered in Massachusetts." Id. The court further
determined that neither ACP nor Auerbach caused tortious injury
through any alleged act or omission in Massachusetts. See id.
And finally, the court rejected as unsubstantiated joint-venture
and conspiracy theories promulgated by Ward. See id. at *10-13.
After the court entered the order dismissing the case as
to ACP and Auerbach, Ward moved to reconsider. He reiterated his
claim that the district court had personal jurisdiction over ACP
and Auerbach because those defendants had "purposeful, specific,
and directed contacts" with Massachusetts. He alleged for the
first time — in a lawyer's memorandum — that ACP and Auerbach
supplied "a steady stream of ACP-501 to . . . [him] both in
Maryland and in Massachusetts" and provided "consulting services
[to] the medical teams in both Massachusetts and Maryland." Ward
also newly alleged that ACP and Auerbach availed themselves of
Massachusetts when they "deployed Massachusetts medical facilities
as injection and monitoring sites for ACP-501, and thus,
necessarily relied on the involvement and supervision of
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Massachusetts medical personnel as well as the utilization of
Massachusetts medical expertise and facilities." Unmoved by these
allegations, the district court denied the motion for
reconsideration.
Not all of the defendants succeeded in obtaining
pretrial relief. The last remaining defendant was Dr. Schaefer,
and the jury rendered a take-nothing verdict in his favor. This
timely appeal followed.3
II
It is apodictic that the burden of proving that personal
jurisdiction may be exercised in the forum state rests with the
party seeking to invoke that jurisdiction. See Motus, LLC v.
CarData Consultants, Inc., 23 F.4th 115, 121 (1st Cir. 2022). The
jurisdictional determination in this case was made at the inception
of the litigation, without the benefit of either pretrial discovery
or an evidentiary hearing. Thus, the familiar prima facie approach
holds sway. See Foster-Miller, Inc. v. Babcock & Wilcox Can., 46
F.3d 138, 145 (1st Cir. 1995); Boit v. Gar-Tec Prod., Inc., 967
F.2d 671, 675 (1st Cir. 1992).
"Where, as here, a district court dismisses a case for
lack of personal jurisdiction based on the prima facie record,
3 Ward died during the pendency of this appeal. Virginia Cora
Ward, who is his sister and the administratrix of his estate, has
been substituted in his place and stead. See Fed. R. App. P.
43(a). We refer to her throughout as the appellant.
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rather than after an evidentiary hearing or factual findings, our
review is de novo." Baskin-Robbins, 825 F.3d at 34 (quoting C.W.
Downer & Co. v. Bioriginal Food & Sci. Corp., 771 F.3d 59, 65 (1st
Cir. 2014)). We are not bound by the district court's reasoning,
though, and we are free to uphold the judgment on any ground
supported by the record. See id.Under the prima facie approach, an inquiring court
"ask[s] only whether the plaintiff has proffered facts that, if
credited, would support all findings 'essential to personal
jurisdiction.'" Chen v. U.S. Sports Acad., Inc., 956 F.3d 45, 51
(1st Cir. 2020) (quoting Foster-Miller, 46 F.3d at 145). We draw
the relevant facts from "the pleadings and whatever supplemental
filings (such as affidavits) are contained in the record, giving
credence to the plaintiff's version of genuinely contested facts."
Baskin-Robbins, 825 F.3d at 34. Even so, we do not "credit
conclusory allegations or draw farfetched inferences."
Ticketmaster-N.Y., Inc. v. Alioto, 26 F.3d 201, 203 (1st Cir.
1994). Instead, the inquiry must be governed by "evidence of
specific facts set forth in the record" — not simply predicated
upon a plaintiff's "unsupported allegations in their pleadings."
Boit, 967 F.2d at 675. Ordinarily, such evidence will be contained
in affidavits, authenticated documents, and the like, submitted by
one or more of the parties. See Ticketmaster-N.Y., 26 F.3d at
203.
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The appellant must show that our exercise of
jurisdiction over the defendants satisfies both the requirements
of the Due Process Clause, see U.S. Const. amend. XIV, § 1, and
the strictures of the Massachusetts long-arm statute, see Mass.
Gen. Laws ch. 223A, § 3. Even though the reach of the
Massachusetts statute is not congruent with the reach of the Due
Process Clause, see Copia Commc'ns, LLC v. AMResorts, L.P., 812
F.3d 1, 4 (1st Cir. 2016), we do not need to inquire into any such
distinctions here: the appellant's attempted assertion of
jurisdiction over ACP and Auerbach plainly does not satisfy even
the constitutional minimum required by the Due Process Clause, see
A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54, 59 (1st Cir. 2016).
Under the Due Process Clause, a court may exercise either
general or specific in personam jurisdiction over an out-of-state
defendant only if that defendant has "certain minimum contacts
with [the forum] such that the maintenance of the suit does not
offend 'traditional notions of fair play and substantial
justice.'" Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)
(quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). A state
holds general jurisdiction over a defendant when the defendant
maintains contacts that are "so 'continuous and systematic' as to
render [the defendant] essentially at home in the forum State."
Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919
(2011) (quoting Int'l Shoe, 326 U.S. at 317). The appellant has
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not proffered a claim of general jurisdiction regarding either ACP
or Auerbach and, thus, any such claim has been waived. See United
States v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990).
To fill this jurisdictional void, the appellant has
advanced a singular claim of specific jurisdiction. A litigant
seeking to establish that a court has specific jurisdiction over
a defendant must satisfy three criteria. "First, the plaintiff's
claim must directly arise from or relate to the defendant's
activities in the forum." Chen, 956 F.3d at 59. "Second, the
defendant's forum-state contacts must 'represent a purposeful
availment of the privilege of conducting activities in that
state.'" Id. (quoting Scottsdale Cap. Advisors Corp. v. The Deal,
LLC, 887 F.3d 17, 20 (1st Cir. 2018)). Third, "the exercise of
specific jurisdiction in the forum must be reasonable under the
circumstances." Id. All three criteria must be satisfied to
establish specific jurisdiction. See id.III
With this framework in place, we turn to the particulars
of the case at hand. The appellant argues that ACP and Auerbach
had sufficient related and purposeful contacts in and with
Massachusetts to satisfy the criteria needed for a finding of
specific jurisdiction. In support, she identifies four alleged
points of contact:
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• that ACP and Auerbach "contacted Dr. Schaefer in
the state."
• that they "sent drugs to the state."
• that they "oversaw the NIH protocol that delivered
the drug to Mr. Ward" and, in the process,
"obtained data and communications from the state
regarding Mr. Ward's condition."
• that they reimbursed Ward "for travel to and from
the state."
In the appellant's view, these points of contact afford "ample
grounds for personal jurisdiction."
We do not agree. On this nearly empty record, it is
luminously clear that neither ACP nor Auerbach may be subjected to
personal jurisdiction in Massachusetts. We explain briefly.
To begin, we do not take into consideration the
appellant's unsupported claim that ACP and Auerbach reimbursed
Ward for his travel between Massachusetts and Maryland. This claim
is not part of Ward's complaint; it appears for the first time in
his lawyer's memorandum opposing the motion to dismiss.4 Such a
source is insufficient to bring the allegation into the
4 The lawyer's memorandum does contain an attachment, in the
form of an email from Dr. Schaefer to Auerbach. That email,
however, merely discusses travel expenses and goes on to say "if
you could reimburse us that would be great." It is unclear from
this email who "us" is, and the appellant offers no clarification.
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jurisdictional calculus. After all, "allegations in a lawyer's
brief or legal memorandum are insufficient, even under the
relatively relaxed prima facie standard, to establish
jurisdictional facts." Barrett v. Lombardi, 239 F.3d 23, 27 (1st
Cir. 2001); cf. Kelly v. United States, 924 F.2d 355, 357 (1st
Cir. 1991) (explaining that "mere allegations in, say, an
unverified complaint or lawyer's brief" are insufficient to fend
off summary judgment).
The appellant's remaining allegations fare no better.
The prima facie approach does not require us to "credit conclusory
allegations or draw farfetched inferences." Ticketmaster-N.Y., 26
F.3d at 203. Yet, this is precisely what the appellant asks us to
do: the three remaining data points on which she relies comprise
a hodge-podge of conclusory and unsupported allegations.
We offer an example. On appeal, the appellant contends
that ACP and Auerbach contacted Dr. Schaefer in Massachusetts.
But in the complaint, there is no inkling that this contact
occurred in Massachusetts. What is more, Auerbach's affidavits
reveal that it was Dr. Schaefer who initiated contact with Auerbach
about Ward and the potential use of ACP-501 in a clinical trial.
Taken together, these facts defenestrate any claim that ACP and
Auerbach purposefully availed themselves of Massachusetts by
initiating contact with Dr. Schaefer. See Walden v. Fiore, 571
U.S. 277, 284 (2014) ("[T]he relationship must arise out of
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contacts that the 'defendant himself' creates with the forum
State." (emphasis in original) (quoting Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 475 (1985))).
Similarly, the appellant's allegation that ACP and
Auerbach sent ACP-501 to Massachusetts does not withstand
scrutiny. This allegation appears for the first time in the
appellant's motion for reconsideration — and "it is settled beyond
hope of contradiction that, at least in the absence of exceptional
circumstances, a party may not advance new arguments in a motion
for reconsideration when such arguments could and should have been
advanced at an earlier stage of the litigation." Caribbean Mgmt.
Grp., Inc. v. Erikon LLC, 966 F.3d 35, 45 (1st Cir. 2020). So it
is here: this allegation could easily have been made at the
inception of the case, and the appellant has made no showing of
exceptional circumstances. It follows that we cannot credit the
belated claim that ACP and Auerbach sent ACP-501 to Massachusetts.
Here, moreover, Ward's complaint and Auerbach's
affidavits make it pellucid that this claim simply is not true:
neither he nor ACP ever sent ACP-501 to Massachusetts, and Ward
was never injected with ACP-501 in that state. The only supplies
of ACP-501 that the defendants shipped went to Maryland.
We add that there is no evidence that ACP or Auerbach
oversaw the NIH clinical trial or that either of them obtained
data from Massachusetts regarding Ward's condition. Although ACP
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and Auerbach may have played indeterminate roles in drafting the
clinical protocol, all of the available evidence indicates that it
was Drs. Shamburek and Remaley who headed the trial — and they did
so from Maryland.
To sum up, the appellant appears to have brought her
suit against ACP and Auerbach on a wing and a prayer. The evidence
of record is scant, especially since the appellant has not
buttressed her filings with any affidavits, sworn statements,
documentary proof, requests for admission, or the like. She has
not even made a request for jurisdictional discovery. Cf. Motus,
23 F.4th at 127-28.
That ends this aspect of the matter. The appellant has
made an argument that requires red meat and strong drink — but she
has supported it only with the thinnest of gruel. Taking what few
facts have been established as a whole and viewing those facts in
the light most congenial to the appellant, see Boit, 967 F.2d at
675, we discern no basis for concluding that either ACP or Auerbach
conducted activities that were sufficiently related to
Massachusetts to satisfy the strictures of the Due Process Clause,
see Chen, 956 F.3d at 59.5
5As noted above, the district court entertained and rejected
joint-venture and conspiracy theories in furtherance of the
appellant's claim of personal jurisdiction over ACP and Auerbach.
See Ward, 2017 WL 2724938, at *10-13. Because the appellant fails
to develop arguments on appeal in support of either theory, we
deem them waived. See Zannino, 895 F.2d at 17.
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IV
We need go no further. For the reasons elucidated above,
the judgment of the district court, in so far as it concerns the
claims asserted against ACP and Auerbach, is
Affirmed.
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