Theravectys SA v. Immune Design Corp. ( 2014 )

COURT OF CHANCERY
OF THE
STATE OF DELAWARE
417 SOUTH STATE STREET
JOHN W. NOBLE DOVER, DELAWARE 19901
VICE CHANCELLOR TELEPHONE: (302) 739-4397
FACSIMILE: (302) 739-6179
December 23, 2014
Jason C. Jowers, Esquire Todd Charles Schiltz, Esquire
Morris James LLP Drinker Biddle & Reath LLP
500 Delaware Avenue, Suite 1500 222 Delaware Avenue, Suite 1410
Wilmington, DE 19801 Wilmington, DE 19801
Re: Theravectys SA v. Immune Design Corp.
C.A. No. 9950-VCN
Date Submitted: September 24, 2014
Dear Counsel:
This letter opinion addresses Defendant Immune Design Corporation’s
(“IDC”) Motion to Compel (“Motion”) Plaintiff Theravectys SA (“TVS”) to
provide substantive and clear responses to certain discovery requests.1 The
underlying litigation involves TVS’s allegations of tortious interference,
misappropriation of trade secrets, and unfair competition against IDC. Both parties
are biotechnology companies that engaged Henogen SA (“Henogen”), a contract
manufacturing organization, to produce lentiviral vectors for use in clinical trials of
1
TVS’s cross motion to compel IDC to identify its new lentiviral vector
manufacturer is moot because the identity of the manufacturer is now known.
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C.A. No. 9950-VCN
December 23, 2014
Page 2
vaccines in humans. Henogen’s vector production for IDC violated the exclusivity
clause of its prior contract with TVS. While Henogen no longer produces vectors
for IDC, IDC has contracted with a replacement manufacturer. TVS believes that
IDC continues to benefit from its wrongful access to its technology.
***
Court of Chancery Rule 26(b)(1) allows “[p]arties [to] obtain discovery
regarding any matter, not privileged, which is relevant to the subject matter
involved in the pending action, whether it relates to the claim or defense of the
party seeking discovery or the claim or defense of any other party.”2 “The
standard for relevance under Court of Chancery Rule 26 is flexible and permits
broad discovery.”3 A party may seek discovery of information inadmissible at trial
if “reasonably calculated to lead to the discovery of admissible evidence.”4
IDC seeks an order compelling TVS to supplement its responses to several
interrogatories and requests for production.
2
Ct. Ch. R. 26(b)(1).
3
In re John Q. Hammons Hotels Inc. S’holder Litig., 2009 WL 891805, at *1 (Del.
Ch. Mar. 25, 2009).
4
Ct. Ch. R. 26(b)(1).
Theravectys SA v. Immune Design Corp.
C.A. No. 9950-VCN
December 23, 2014
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A. Interrogatories
IDC asked TVS to identify which trade secrets it believes were
misappropriated and to describe how such misappropriation allegedly occurred.
Since IDC filed the Motion, TVS supplemented its responses to sufficiently
describe its allegedly misappropriated trade secrets and the manner of
misappropriation to the best of its knowledge. There is no need to compel further
response regarding these issues.
Next, IDC asked TVS to identify all of the business and investment
opportunities it allegedly lost as a result of IDC’s conduct. TVS maintains that it
has responded to IDC’s request to the best of its ability given the extent of its
current knowledge. The Court will not enter an order compelling interrogatory
responses outside the scope of a party’s knowledge.5 Therefore, no order
compelling further response is warranted.
IDC also demanded that TVS elaborate on how IDC’s relationship with
Henogen allegedly allowed IDC to expedite its vaccine production and movement
through clinical trials. Again, however, TVS asserts that it has provided the most
5
Cf. RG Barriers, Inc. v. Jelin, 1996 WL 377014, at *1 (Del. Ch. July 1, 1996) (“I
will not enter an order requiring production of documents which do not exist.”).
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C.A. No. 9950-VCN
December 23, 2014
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complete responses it can based upon its current knowledge. No order requiring
further response is necessary.6
B. Requests for Production
IDC requested that TVS produce (i) documents relating to the manufacture
and development of its lentiviral vector products and (ii) all documents regarding
Henogen. TVS argues that the responsive documents it has produced are sufficient
to show all aspects of its relevant manufacturing processes and relationship with
Henogen. However, IDC’s requests relate to issues that are central to TVS’s
claims. IDC has the right to examine these relevant documents to determine for
itself whether they provide utility. To the extent that it has not already done so,
TVS shall supplement its responses to IDC’s production requests numbered 2, 7, 8,
and 11.
IDC also requested documents regarding TVS’s actual and potential
investors and business partners. While TVS produced responsive documents, it
limited its production of communications with potential investors to nonprivileged
6
TVS’s assertions that it has responded to IDC’s interrogatories to the best of its
knowledge have a somewhat preclusive effect if TVS subsequently finds it is
strategically convenient to supplement.
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C.A. No. 9950-VCN
December 23, 2014
Page 5
communications on or after July 1, 2013. TVS set this cutoff date due to its belief
that third parties were unaware of IDC’s business relationship with Henogen until
summer 2013. Because IDC requested these documents to test the allegation that
its relationship with Henogen negatively affected TVS’s business, TVS asserts that
communications made before others were aware that IDC had contracted with
Henogen are irrelevant.
However, IDC maintains that communications predating July 1, 2013, may
be relevant to its defense. For example, those documents might reveal reasons,
completely unconnected to IDC, why third parties did not invest in TVS. Given
the relevance that those documents may have to important and contested issues,
TVS shall supplement its responses to IDC’s document requests numbered 19 and
20.7
7
TVS has redacted certain documents in order to abide by contractual
confidentiality agreements with third-party investors and partners. Confidentiality
agreements deserve a degree of respect and should not be avoided absent a
showing of necessity. However, TVS put its relationships with third parties at
issue in this case. TVS cannot hide behind its confidentiality agreements to shield
any relevant information. Nonetheless, TVS has represented that the only
information it has redacted relates to “communications that would reveal the
potential strategic partner’s confidential information in violation of a
confidentiality agreement.” TVS may continue to protect this information to the
Theravectys SA v. Immune Design Corp.
C.A. No. 9950-VCN
December 23, 2014
Page 6
IDC’s Motion to Compel is thus denied in part and granted in part, in
accordance with the parameters described in this letter opinion.8
IT IS SO ORDERED.
Very truly yours,
/s/ John W. Noble
JWN/cap
cc: Register in Chancery-K
extent that this is indeed the limit of its redactions, as the relevance that such
information may have for IDC’s defense is not apparent. Further, to the extent that
TVS continues to redact this information based on its confidentiality and
irrelevance, a preclusive effect analogous to that identified in note 6 may be
warranted.
8
IDC also requested production relating to any actual or potential manufacturer of
lentiviral vectors for TVS other than Henogen. TVS since clarified that it has no
objection to this request.