Cardiorentis AG v. IQVIA Ltd.

Citation373 N.C. 309,837 S.E.2d 873 (Mem)
Decision Date28 February 2020
Docket NumberNo. 168A19,168A19
Parties CARDIORENTIS AG v. IQVIA LTD. and IQVIA RDS, Inc.
CourtUnited States State Supreme Court of North Carolina

Robinson, Bradshaw & Hinson, P.A., by J. Dickson Phillips III, Chapel Hill, and Jonathan C. Krisko, Charlotte; and Hogan Lovells US LLP, by Catherine E. Stetson, for plaintiff.

Brooks, Pierce, McLendon, Humphrey & Leonard, L.L.P., by Charles F. Marshall and Shepard D. O’Connell, Greensboro; Cooley LLP, by Michael J. Klisch, Joshua M. Siegel, and Robert T. Cahill, for defendants.

PER CURIAM.

AFFIRMED.

APPENDIX

STATE OF NORTH CAROLINA

DURHAM COUNTY

CARDIORENTIS AG,

Plaintiff,

v.

IQVIA LTD. and IQVIA RDS, INC.,

Defendants.

IN THE GENERAL COURT OF JUSTICE

SUPERIOR COURT DIVISION

18 CVS 2313

ORDER AND OPINION ON DEFENDANTS’ PRE-ANSWER MOTIONS

1. Plaintiff Cardiorentis AG is a Swiss biopharmaceutical company. Its flagship drug, Ularitide, is a treatment for heart failure. In 2012, Cardiorentis enlisted IQVIA Ltd. ("IQVIA UK"), an English contract research organization, to perform a worldwide clinical trial of Ularitide with a view toward obtaining the regulatory approvals needed to market the new drug. The trial was not successful. According to Cardiorentis, the results were invalid, compromised by the inclusion of hundreds of ineligible patients. Cardiorentis blames both IQVIA UK and its North Carolina-based parent, IQVIA RDS, Inc. ("IQVIA NC"), asserting claims for breach of contract and fraud, among others.

2. Neither IQVIA UK nor IQVIA NC has answered the complaint, instead opting to file several pre-answer motions. Defendants first ask the Court to stay all proceedings under N.C. Gen. Stat. § 1-75.12 on forum non conveniens grounds. (ECF No. 19.) IQVIA UK separately asks the Court to dismiss the claims against it for lack of personal jurisdiction. (ECF No. 17.) In the alternative, Defendants also seek to dismiss all claims on the merits pursuant to North Carolina Rule of Civil Procedure 12(b)(6). (ECF No. 21.)

3. For the following reasons, the Court GRANTS Defendantsmotion to stay all proceedings under section 1-75.12. The Court DENIES as moot all other requested relief.

Robinson, Bradshaw & Hinson, P.A., by J. Dickson Phillips III, Jonathan C. Krisko, and Morgan P. Abbott, and Hogan Lovells US LLP, by Dennis H. Tracey III and Allison M. Wuertz, for Plaintiff Cardiorentis AG.
Brooks, Pierce, McLendon, Humphrey & Leonard, L.L.P., by Charles F. Marshall, Charles E. Coble, and Shepard D. O’Connell, and Cooley LLP, by Michael J. Klisch and Robert T. Cahill, for Defendants IQVIA Ltd. and IQVIA RDS, Inc.

Conrad, Judge.

I.BACKGROUND1

4. It is not clear when Cardiorentis began developing Ularitide, but by April 2010, the regulatory-approval process was underway. (See Compl. ¶¶ 18, 19, ECF No. 3.) Though based in Switzerland, Cardiorentis hoped to market the drug widely. It sought approvals from two of the world’s key regulatory agencies, the United States Food and Drug Administration and the European Medicines Agency. (Compl. ¶ 19.) Cardiorentis completed two preliminary clinical trials before selecting IQVIA UK, an English company, to manage a Phase III trial designed to demonstrate Ularitide’s safety and efficacy. (Compl. ¶¶ 1, 4, 20.)

5. In August 2012, Cardiorentis and IQVIA UK (named Quintiles Ltd. at that time) entered into a General Services Agreement ("Services Agreement") that set out the terms for a global, multi-year trial. (Compl. ¶¶ 1, 6, 21; Mem. in Supp. Mot. Stay Ex. 2, ECF No. 20.3 ["Services Agreement"].) IQVIA UK agreed to design and run the trial in its entirety. (Compl. ¶ 22.) Its duties included developing the protocol that established the essential criteria for determining a patient’s eligibility to participate. (Compl. ¶¶ 22(a), 30.) IQVIA UK was also required to select all trial sites, to monitor each site to ensure compliance with the protocol, and to perform full source data verification to ensure that reported data matched the patient’s original medical records. (See Compl. ¶¶ 22(b), 22(f), 22(f), 37, 39; Defs.’ Reply Br. in Supp. Mot. Stay Ex. 3 ¶¶ 18–19, ECF No. 81.4.) Other duties included data management, statistical analysis, and medical advisory services. (See Mem. in Supp. Mot. Stay Ex. 5 ¶¶ 7, 9–12, ECF No. 20.6.) The Services Agreement is governed by English law and allows IQVIA UK to use the services of its corporate affiliates, including its parent IQVIA NC. (Services Agreement §§ 20.0; 28.0; Defs.’ Mem. in Supp. Mot. Stay 4, ECF Nos. 20, 61 ["Mem. in Supp."].)

6. Eight months after executing the Services Agreement, Cardiorentis entered into a Clinical Quality Agreement ("Quality Agreement") with IQVIA NC (named Quintiles, Inc. at that time). (Compl. ¶ 24.) The Quality Agreement functioned as an extension of the Services Agreement, outlining processes for effective communication during the trial. (See Mem. in Supp. Ex. 3 § 1, ECF No. 20.4 ["Quality Agreement"].)

If the Services Agreement and Quality Agreement conflicted in any way, the Services Agreement would control. (Quality Agreement § 1.)

7. The trial appears to have been a mammoth undertaking, involving more than a hundred trial investigators, thousands of patients, and hospitals in 23 countries. (See Compl. ¶¶ 7, 8, 34; Defs.’ Reply Br. in Supp. Mot. Stay 6, ECF No. 81 ["Reply Br."].) Over a three-year period, IQVIA UK trained the investigators and then collected, managed, and reviewed the trial data. (Compl. ¶¶ 22(c), 22(g).) Yet the trial was unsuccessful. (Compl. ¶¶ 8, 82, 84.)

8. Cardiorentis now seeks to hold Defendants responsible for the failed trial, claiming that both Defendants breached the Services Agreement and that IQVIA NC breached the Quality Agreement. (Compl. ¶¶ 91, 99.) Cardiorentis alleges, among other things, that Defendants provided inadequate training, failed to monitor the trial sites, allowed hundreds of ineligible patients to enroll, and then concealed deviations from the protocol. (See Compl. ¶¶ 46–49, 51.) These violations, Cardiorentis alleges, were intentional—a conscious choice to withhold resources and reduce trial costs for the purpose of inflating Defendants’ stock price before a merger. (See Compl. ¶¶ 54–56.) In addition to its claims for breach of contract, Cardiorentis asserts claims for fraud, tortious misrepresentation, and violations of North Carolina’s Unfair and Deceptive Trade Practices Act. (Compl. ¶¶ 106, 120, 130.)

9. In their pre-answer motions, Defendants contend that this case has little connection to North Carolina. They jointly seek a stay on forum non conveniens grounds, and IQVIA UK separately contends that this Court lacks personal jurisdiction over it. In the event North Carolina is a proper venue, Defendants contend that the case should be dismissed anyway because the complaint fails to state a claim for relief.

10. Before responding to the motions, Cardiorentis served discovery requests geared toward venue and personal jurisdiction. (See ECF No. 50.) Defendants objected to those requests. After full briefing, the Court denied Cardiorentis’s motion for venue-related discovery, noting that courts typically do not permit discovery before deciding forum non conveniens . See Cardiorentis AG v. IQVIA Ltd. , 2018 NCBC LEXIS 96, at *3–4, 8 (N.C. Super. Ct. Sept. 14, 2018).

11. Defendants’ pre-answer motions are now fully briefed, and the Court held a hearing on November 13, 2018. (ECF No. 71.) The motions are ripe for decision.

II.ANALYSIS

12. Defendants argue that North Carolina is an inconvenient forum and that Cardiorentis’s claims should be heard, if at all, in England.2 On that basis, they ask the Court to stay this case under section 1-75.12. Cardiorentis responds that North Carolina is not only a convenient forum but also the forum with the most substantial connection to the case.

13. Section 1-75.12 codifies the doctrine of forum non conveniens . If a trial court finds "that it would work substantial injustice for [an] action to be tried in a court of this State, the judge on motion of any party may enter an order to stay further proceedings in the action in this State." N.C. Gen. Stat. § 1-75.12(a). Put another way, when it appears that this State "is an inconvenient forum and that another is available which would better serve the ends of justice and the convenience of [the] parties, a stay should be entered." Motor Inn Mgmt., Inc. v. Irvin-Fuller Dev. Co. , 46 N.C. App. 707, 713, 266 S.E.2d 368, 371 (1980) (citing Silver v. Great Am. Ins. Co. , 29 N.Y.2d 356, 361, 328 N.Y.S.2d 398, 278 N.E.2d 619 (1972) ).

14. In deciding whether to grant a stay, our courts usually consider a series of convenience factors and policy considerations, including

(1) the nature of the case, (2) the convenience of the witnesses, (3) the availability of compulsory process to produce witnesses, (4) the relative ease of access to sources of proof, (5) the applicable law, (6) the burden of litigating matters not of local concern, (7) the desirability of litigating matters of local concern in local courts, (8) convenience and access to another forum, (9) choice of forum by plaintiff, and (10) all other practical considerations.

Lawyers Mut. Liab. Ins. Co. of N.C. v. Nexsen Pruet Jacobs & Pollard , 112 N.C. App. 353, 356, 435 S.E.2d 571, 573 (1993) (citing Motor Inn , 46 N.C. App. at 713, 266 S.E.2d at 371 ). These factors parallel the public and private interest factors that federal courts use to decide motions premised on forum non conveniens . See, e.g. , Gulf Oil Corp. v. Gilbert , 330 U.S. 501, 508–09, 67 S.Ct. 839, 91 L.Ed. 1055 (1947) ; DiFederico v. Marriott Int’l, Inc. , 714 F.3d 796, 804–08 (4th Cir. 2013) ; see also Motor Inn , 46 N.C. App. at 713, 266 S.E.2d at 371.

15. It is not necessary to consider each factor or to find that every factor weighs in favor of a stay. See Muter v. Muter , 203 N.C. App. 129, 132–33, 689 S.E.2d 924, 927 (2010) ; Wachovia Bank v. Deutsche Bank Tr. Co. Ams. , 2006 WL 1591130, at *2, 2006 NCBC LEXIS 10, at *12 (N.C. Super. Ct. ...

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