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  • Shelly Albaum

Elysium's Motion to Dismiss the 5AC


So now we have Elysium's motion to dismiss ChromaDex's new claims in the 5th Amended Complaint. You can read it here:

Elysium's Motion to Dismiss the 5AC

The core of Elysium's argument is that the confidentiality agreement that Morris signed is invalid, and the other claims against Morris can only be asserted under the California Uniform Trade Secret Act. And since Morris can't be liable under those claims, Elysium can't be liable for aiding and abetting him.

There does seem to be an obvious consideration problem the agreement signed after Morris resigned.

But it's a little too-obvious, so we can safely assume that ChromaDex has some other grounds supporting that, like a prior agreement or some consideration besides that which is listed in the agreement. We'll wait for ChromaDex's opposition motion to weigh the competing arguments.

One interesting bit in the motion is this recitation of the factual history of the case, as Elysium tells it:

Perceiving that its continued access to a source of NR was in jeopardy, in mid-July of 2016, Elysium elected to begin exploring development of a new supply chain for the ingredient that would not depend on its untrustworthy contractual partner, but would instead be entirely within Elysium’s control.

Well, that's a crucial point, and apparently it's going to be contested. Whether Elysium began exploring a new supply chain in mid-July -- after it placed the large orders and hired Morris -- or as early as April when it allegedly recruited Morris to act as an inside agent and convey confidential information (according to ChromaDex) will be critically important.

The distant glimpse we've gotten at the discovery suggests that there is evidence against Elysium's version above, which suggests that Elysium might be using language very precisely when it says "began exploring a new supply chain," to exclude all kinds of preparation for that exploration.

At the very least I would suggest that Elysium is using words artfully and outside their normal meaning when it says, two pages later,

The Fifth Amended Complaint represents ChromaDex’s...attempt to retaliate against Elysium – and now Mark Morris – for removing ChromaDex from Elysium’s supply chain...

What a weird idea that Elysium, in creating an alternative supply chain, was removing ChromaDex from Elysium's supply chain. ChromaDex WAS Elysium's supply chain. Elysium didn't HAVE a supply chain; ChromaDex did. So the idea that ChromaDex's supply chain was really just Elysium's supply chain from which ChromaDex could be removed is either counterfactual, or delusional, or pretzel-contorted logic.

Any time a party needs to torture the factual history like that, it tends to be a bad sign for that party.

#CDXC #ChromaDex #ElysiumHealth #Litigation

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