VasoNova, Inc. v. Grunwald et al
Filing
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ORDER ON DEFENDANTS' MOTIONS TO JOIN TELEFLEX INC. PURSUANT TO RULES 12(b)(7) and 19 by Judge Alsup entered 32 Motion for Joinder; denying 38 Motion for Joinder (whalc2, COURT STAFF) (Filed on 8/24/2012)
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IN THE UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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VASONOVA INC.,
No. C 12-02422 WHA
Plaintiff,
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For the Northern District of California
United States District Court
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v.
ORDER ON DEFENDANTS’
MOTIONS TO JOIN
TELEFLEX, INC. PURSUANT
TO RULES 12(B)(7) AND 19
SORIN GRUNWALD, ROMEDEX
INTERNATIONAL SRL, and BARD ACCESS
SYSTEMS, INC.,
Defendants.
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INTRODUCTION
In this intellectual-property dispute, defendants move separately to join Teleflex, Inc.
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pursuant to Rules 12(b)(7) and 19. For the reasons stated below, defendant Romedex’s motion is
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disregarded as a NULLITY and defendant Grunwald’s motion is DENIED.
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STATEMENT
Plaintiff VasoNova, Inc. is a developer and manufacturer of medical devices (First Amd.
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Compl. ¶ 1). In its early days as a start-up, VasoNova sought to develop and commercialize a
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system that would allow physicians to efficiently place catheters without the need for an x-ray
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(id. ¶¶ 13, 20). VasoNova hired defendant Sorin Grunwald as its chief technology officer to aid
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in developing this system (id. ¶ 1). Through his role as CTO, Grunwald was allegedly
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“intimately involved in every aspect of the development of VasoNova’s VPS (Vascular
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Positioning System) product.” As VasoNova began attracting investors, it entered into
confidentiality agreements with its employees. Grunwald signed a confidentiality, invention
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assignment and arbitration agreement. Additionally, upon Grunwald’s resignation from
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VasoNova, he signed a separation agreement, which reaffirmed his agreement to abide by the
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terms of the confidentiality agreement (id. ¶¶ 18–20).
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After his resignation from VasoNova, Grunwald began filing patent applications for a
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product called “Sapiens TLS”. He did not inform VasoNova of the patent applications or assign
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the patents to VasoNova (id. ¶¶ 34–40). VasoNova claims ownership of the Sapiens technology
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and alleges that Grunwald developed the technology while still employed at VasoNova.
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Grunwald denies these claims. After obtaining the patents, Grunwald incorporated Romedex
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International and assigned the patents to his newly created company (id. ¶¶ 37, 41). He then sold
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For the Northern District of California
United States District Court
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the Sapiens technology to Bard Access Systems Inc., a competitor of VasoNova.
Prior to Bard’s acquisition, Romedex was in negotiations with Teleflex to discuss a
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possible acquisition of the former by the latter. Teleflex signed a non-disclosure agreement and
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conducted due diligence. After completing due diligence, Teleflex made an offer to acquire
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Romedex and to employ Grunwald. Teleflex’s efforts to acquire Romedex failed and
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negotiations ended without the closing of an agreement (Grunwald Decl. ¶ 10). Teleflex then
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turned its sights onto VasoNova, Grunwald’s past employer. Teleflex succeeded in acquiring
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VasoNova (id. ¶ 12). Teleflex is now VasoNova’s parent company; however, the two are
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separate legal entities. Accordingly, VasoNova has a board of directors who are separate from
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Teleflex’s board of directors and files corporate taxes in its own name. VasoNova also alleges
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that it did not assign the contracts with Grunwald, the subject of this action, to Teleflex (Molloy
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Decl. ¶¶ 5, 8–10).
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VasoNova obtained FDA clearance for its VPS product that employs the Sapiens
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technology (Grunwald Decl. ¶ 13). Teleflex has begun marketing VasoNova’s VPS product
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under Teleflex’s name in the United States and in Europe (id. ¶ 17). In this civil action,
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VasoNova is seeking relief from Grunwald, Romedex and Bard regarding the ownership and use
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of the Sapiens technology (First Amd. Compl. ¶ 1). Defendants Grunwald and Romedex now
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move to join Teleflex as a required party to this action on the grounds that: (1) complete relief
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cannot be accorded among the existing parties VasoNova, Grunwald, Romedex and Bard; (2)
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Teleflex’s absence will impair or impede its ability to protect its interests regarding the Sapiens
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technology; (3) Grunwald is substantially at risk to be exposed to double, multiple or
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inconsistent obligations if Teleflex is absent from this action.
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*
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Grunwald files this motion on his own behalf and files a nearly identical motion on
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Romedex’s behalf. The July 25 order denied Grunwald’s motion for permission to appear and
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respond on behalf of Romedex because Civil Local Rule 3-9(b) requires entities like, Romedex,
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to “appear only through a member of the bar of this Court.” Grunwald is not a member of the
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bar. Accordingly, his motion on Romedex’s behalf is disregarded as a nullity. Grunwald’s
motion on his own behalf is permitted and is considered in this order.
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For the Northern District of California
United States District Court
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ANALYSIS
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Before addressing the merits of Grunwald’s motion, this order must address a fairness
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and procedural objection. VasoNova asserts that considerable portions of Grunwald’s motion
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should be struck for failure to file an affidavit or declaration required under Civil Local Rule 7-5.
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This rule requires that “[f]actual contentions made in support of or in opposition to any motion
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must be supported by an affidavit or declaration and by appropriate references to the record.”
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Grunwald did not include an affidavit or declaration that supports all his factual contentions in
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his motion. This was improper and is not cured by appending a revised declaration to his reply
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brief because it deprived VasoNova the opportunity to respond in its opposition. Grunwald’s
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status as a pro se litigant hardly excuses this lapse, especially since he has advanced degrees.
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The relevant portions of Grunwald’s motion that were unsupported by an affidavit or declaration
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are accordingly struck. Nonetheless, even if this shortfall was excused, the motion would fail on
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the merits, as set forth below.
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Rule 19 requires that the missing party be both necessary and indispensable to the action
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to grant such a motion. In assessing necessity and indispensability, the inquiry should be both
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fact-specific and practical. Provident Tradesmens Bank & Trust Co. v. Patterson, 390 U.S. 102,
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118–119 (1968). Rule 19(a)(1) contains the “necessary party” test, which itself contains two
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prongs. Either prong may be met to satisfy Rule 19(a)(1). The first prong states that a party
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must be joined if “in that person’s absence, the court cannot accord complete relief among
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existing parties.” This prong concerns complete relief only among current parties to the action.
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Disabled Rights Action Comm. v. Las Vegas Events, Inc., 375 F.3d 861, 879 (9th Cir. 2004).
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The second prong states that joinder of a party is required if “that person claims an interest
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relating to the subject of the action and is so situated that disposing of the action in the person’s
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absence may: (i) as a practical matter impair or impede the person’s ability to protect the
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interest; or (ii) leave an existing party subject to a substantial risk of incurring double, multiple,
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or otherwise inconsistent obligations because of the interest.”
that VasoNova owns the property and Grunwald asserts he (or his co-defendants) own it. The
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For the Northern District of California
The complaint can be adjudicated without Teleflex’s presence. The complaint asserts
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United States District Court
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complaint can be adjudicated without Teleflex’s presence. Thus, the first prong fails. The
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second prong also fails because Teleflex does not claim any independent right vis a vis the issues
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raised in the complaint.
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CONCLUSION
Grunwald has not carried his burden to show that Teleflex is a necessary and
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indispensable party. Teleflex’s joinder is not required and failure to join does not require
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dismissal. For the foregoing reasons, Grunwald’s motion is DENIED. This denial is without
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prejudice should Grunwald decide to file a timely and proper counterclaim herein against
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Teleflex under Rule 13 or a third-party complaint under Rule 14. This order merely holds that
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Rule 19 does not bar VasoNova’s complaint for failure to include Teleflex. Additionally, for the
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foregoing reasons, Romedex’s motion is disregarded as a NULLITY. Romedex should appear
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and respond with proper counsel to avoid future motions from being disregarded in this action.
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IT IS SO ORDERED.
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Dated: August 23, 2012.
WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE
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