Elysium Moves for Reconsideration in New York
Elysium did not like it that Judge McMahon granted summary judgment against all of the FDA claims in New York.
I predicted that Elysium would probably not appeal, because the Noerr-Pennington defense was really strong (from the start), and because the way Judge McMahon wrote her opinion would not be particularly easy to overturn.
But I'll count myself wrong, because Elysium has filed a motion for reconsideration. You can read it here:
A motion for reconsideration is when you tell the judge that they have made a mistake, and they should change their mind, and you show them the mistake they made.
As you might guess, motions for reconsideration are granted INfrequently.
Thanks to Westlaw Edge, we can see how often Judge McMahon grants Motions for Reconsideration, historically:
Hmmm...granted in whole or in part about a third of the time. That's more than I would have expected, but still not that often. Let's take a look at Elysium's arguments:
First, Elysium does not like it that the Court relied on Elysium's claiming to have removed the toluene to establish that there was some basis to ChromaDex's complaint requesting that the toluene by removed from Basis. Elysium says that the court should have considered other factors as well.
Second, Elysium says that the reason for its alleged removal of the toluene from Basis is a question of fact that can't be resolve against Elysium on a motion for summary judgment. In fact, even the suggestion that the purpose of ChromaDex's petition was to have the toluene removed was, according to Elysium, a disputed factual matter that could not be resolved against it on summary judgment.
Third, says Elysium, once the motion to dismiss was converted to a motion for summary judgment, Elysium was entitled to discovery before the Court ruled on the motion.
These are technically plausible arguments in the sense that if the Court applied the wrong standard, resolved factual arguments without evidence, or improperly denied discovery, then it might be reversible error.
But my sense is that Elysium is mischaracterizing what the Court did in important ways. For example, Judge McMahon's found one consideration compelling, but that doesn't mean that she did not also consider the other factors or that she ignored the factual context in which that occurred.
Similarly, it's not clear to me that Elysium's purpose in removing the toluene could reasonably be considered a disputed factual matter. Judge McMahon specifically held that it could not be, and I'm not sure that Elysium's desire to dispute it makes it disputable.
Elysium had to go far afield to find a Second Circuit case that maybe suggested that a favorable outcome doesn't prove the applicability of Noerr-Pennington. The case they characterize as "mandatory authority" involves a shopping center lease that doesn't even look vaguely like our scenario. In Landmarks, the Court held:
In sum, by the bringing of numerous meritless appeals, by deliberate delay in the prosecution of those appeals, by the solicitation and subsidization of meritless litigation by the landowners, and by their attorney’s failure to convey a settlement offer to the Neals, the Plaza defendants successfully stalled plaintiffs’ applications for zoning changes on the Evergreen Avenue property for five years. This delay ultimately forced the plaintiffs to abandon their venture. We hold that these allegations state a cause of action under the antitrust laws.
They call it "mandatory authority;" I would call it entirely inapposite and distinguishable. It takes a great deal of imagination to find any similarities between the two cases.
And I REALLY don't know what the standards are for when you are entitled to discovery, but it seems like Judge McMahon offered Elysium the chance to deliver the CoAs that they said proved its case, and Elysium did so, and she was not impressed (nor were we - we said Elysium was "wasting our time with nonsense"). Does Elysium get an all-you-can-eat fishing expedition just because they want one? The federal rules might not say that.
It's a good question what Judge McMahon is going to do with this. I think if I had to predict, I think she might deny the motion summarily. Part of what Elysium is doing here is waving around their toluene CoAs some more, which obviously did not impress Judge McMahon the first time, even though she was too polite (or busy) to comment on it specifically.
I assume that Elysium is setting up an appeal to the Second Circuit, because they have shown if anything an endless thirst for litigation. So I hope that Judge McMahon takes the time to write an opinion defending her decision and demolishing Elysium's arguments, so the Second Circuit can quickly deny the appeal. And no doubt we will soon have from ChromaDex an opposition brief that does the heavy lifting on that.
On the other hand, the SDNY Judges are busy with real disputes involving significant matters. Since Judge McMahon issued her original Summary Judgment motion in our case, she has issued dozens of other opinions in other cases. During two weeks in December some of her written decisions addressed a Nike trademark dispute, a labor dispute involving HBO, a copyright dispute involving a photo of criminal defendant, and a decision to take jurisdiction over a securities fraud case that had been in the bankruptcy court.
This opinion, from December 19, gives a flavor of just how much judge McMahon likes to put up with bullshit. [This is a criminal case involving LIBOR manipulation at Deutsche Bank.]
COLLEEN McMAHON, Chief Judge
I have the Government’s letter motion seeking to strike three of the four briefs filed in support of the various post-trial motions, as well as defendants' response, in which they admit that they failed formally to seek leave to file briefs of more than 25 pages, but blame their failure on my comment that I expected I would receive “extensive briefing.”
Frankly, I was so sure I had granted an application to exceed the page limit that I had Mr. O'Neill go back on the docket to confirm my supposition. Apparently, I did not grant such an application.
Obviously, I would have granted it had one been made. It would not be possible to do post-trial briefing in 25 page briefs in this case. The Government knows that.
Which is why its motion is so absurd.
The motion is denied.
The Government can have as long as it wishes to respond to the defense motions. Work out your own schedule.
That said, if I were the Government (which, as I have so often observed, I am not), I would not put a whole lot of effort into the insufficiency motions and would instead concentrate on the real deal– Mr. Connolly’s Kastigar/outsourced investigation motion. This will likely require the Government to offer a great deal of evidence about what it (not Deutsche Bank/Paul Weiss) did to investigate this case between 2010 and 2015, which I think is the date on the earliest 302 I have read. I don't know whether we will need a full-blown hearing on this motion, like the one Judge Linares held—that will depend on what comes in on paper—but that is where the Government should be concentrating its efforts.
As for the Government misconduct motion, I view it principally as preserving an already well-preserved record, but it does contain some new matters, and the Government should give the arguments raised in that motion such shrift as it believes they deserve. The Government should not, however, argue that I have already ruled on these issues and leave it at that, because, to the extent the issues have been raised yet again, I will rule on them yet again.
Let me know what schedule you set.
This is a No-Bullshit judge, and Elysium -- in my opinion -- is willing and able to make the kinds of arguments that Judge McMahon might call "absurd." But if Judge McMahon does write an opinion, it could take a while. And if the Second Circuit reviews it, that could take a while. And if all Elysium is really trying to do is to impose legal cost and buy time, then I guess it wins either way.
We'll see happens next.