Med. Device Solutions, LLC v. Aferzon

Decision Date28 September 2021
Docket NumberAC 44098
Citation264 A.3d 130,207 Conn.App. 707
Parties MEDICAL DEVICE SOLUTIONS, LLC v. Joseph AFERZON et al.
CourtConnecticut Court of Appeals

John L. Cordani, Jr., with whom, on the brief, was Andrew A. DePeau, Hartford, for the appellants-appellees (defendants).

Michael T. Cretella, with whom was Brian P. Daniels, New Haven, for the appellee-appellant (plaintiff).

Elgo, Alexander and Sheldon, Js.

SHELDON, J.

This appeal and cross appeal involve a dispute over the defendants’ alleged failure to make payments to the plaintiff under a contractual agreement between them to share equally all compensation resulting from the sale and/or licensing of a medical device conceived of by the individual defendant, or any version thereof, in exchange for the plaintiff's creation of design drawings and a prototype of the device based on the individual defendant's initial sketches of it. The defendants appeal from the judgment of the trial court, Moukawsher, J ., rendered in favor of the plaintiff on its claims of breach of contract and unfair trade practices in violation of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq., arising from that dispute. The defendants claim that the trial court improperly concluded (1) that the parties entered into a definite and enforceable contract to make the subject payments in exchange for the plaintiff's work, (2) that payments received by the defendants for the sale and/or licensing of an anterior spinal fusion

device known as the Solus, which was based on a design patented by the individual defendant after his alleged contract with the plaintiff had been entered into, were covered by the contract, (3) that all statutes of limitations applicable to the plaintiff's claims for relief in this case were tolled under the fraudulent concealment doctrine and/or the continuing course of conduct doctrine, and (4) that the plaintiff was entitled to recover attorney's fees from the defendants under CUTPA based upon the defendants’ bad faith breaches of the parties’ alleged contract. The plaintiff cross appeals from the trial court's judgment awarding it offer of compromise interest on its judgment against the defendants, arguing that the court improperly calculated the amount of such interest to which it was entitled. On the defendants’ appeal, we affirm in part and reverse in part the judgment of the trial court. On the plaintiff's cross appeal, we reverse the judgment of the trial court and remand the case for further proceedings with instructions to recalculate the amount of offer of compromise interest to which the plaintiff is entitled in accordance with this opinion.

The following procedural history and facts, as found by the court and supported by the record, are relevant to this case. The plaintiff corporation, Medical Device Solutions, LLC (plaintiff or MDS), was formed in 2003, by William Lyons in Meriden to engage in the business of designing and developing medical device prototypes. At the time he formed MDS, Lyons was already the partial owner and operator of another company in Meriden called Lyons Tool & Die, which was engaged in the business of manufacturing medical components. MDS and Lyons Tool & Die were operated in the same physical premises, and MDS used Lyons Tool & Die employees to manufacture its prototypes. MDS initially had one other member, Wayne Young, who remained a 50 percent owner of the corporation until 2007.

The individual defendant, Joseph Aferzon, is an accomplished neurosurgeon and inventor who has owned and operated a private medical practice in Connecticut since 1996. Aferzon frequently partnered with Jeffrey A. Bash, an orthopedic spine surgeon, to perform complex spinal surgeries. Bash estimated that he and Aferzon had performed approximately 10,000 surgeries together by the time of trial. The defendant corporation, International Spinal Innovations, LLC (ISI), was formed in 2007 by Aferzon and Bash to develop medical devices for use in spinal surgery.

Aferzon was interested in making spinal fusion

surgery safer and less invasive. In June, 2004, he conceived of a small spinal fusion device consisting of a cage and rotating blades. The trial court described the concept of the device as follows: "The cage is a sturdy tapering rectangle, open, without top or bottom. Within its four walls is a series of rotating, claw-like blades. Doctors insert this cage between the vertebrae of the spine and use a tool to thrust sets of the claws out of the cage's top and bottom. As the claws emerge from their cage, they dig themselves into the ends of the vertebrae, fixing the cage in place between them. This fuses the bones together, and they gradually heal into a single solid bone." Aferzon sketched some initial drawings of the device and, on September 27, 2004, applied for a provisional patent on it with the United States Patent and Trademark Office (patent office) on the basis of those drawings. The patent application titled the device a "CLAWFIX" and described it as a "novel method" for "direct intervertebral fixation." Attached to the application were the initial drawings of the device that Aferzon had sketched in June, 2004.

On November 4, 2004, Aferzon approached Lyons and Young at MDS to ask for their help in creating the device. He provided them with his initial drawings and asked them to create a prototype of the device. During that visit, MDS gave Aferzon a one page document for his signature, which he and Lyons then signed. This document set forth an agreement that is central to the parties’ dispute. The subject line of the document reads, "Reference invention: Spinal Cage

with Rotating/OpposingBlades," and its text provides: "Joseph Aferzon (inventor/owner of above stated invention) agrees that [MDS] will receive 50% of the total compensation resulting from the sale and/or licensing of the above mentioned device, versions of this device, associated intellectual property and/or any intellectual property developed associated with this device and/or versions of this device. Any development, funding or financial commitments required will be part of a separate agreement and negotiated at a later date. [Aferzon] further agrees to promptly notify [MDS] of any compensation received for the above mentioned device, versions of the device, associated intellectual property and/or any intellectual property developed associated with this device and versions of this device. This agreement is limited to the above mentioned device, versions of this device, associated intellectual property and/or any intellectual property developed associated with this device and/or versions of this device. In signing this agreement, [Aferzon] agrees that he has not had prior contact with any company regarding this specific device and he is not under any contractual agreement with any other companies concerning this device."

Although the document provided that "[a]ny development, funding or financial commitments required will be part of a separate agreement and negotiated at a later date," the parties agree that no further written agreements were ever executed. The court instead found, as Lyons and Young both testified, that the parties agreed orally, on the same day they signed the written agreement, that MDS's obligation under the written agreement would be to create drawings and a prototype of the new device conceived by Aferzon "as a part [of] an effort to prove the concept" of the device.1

Lyons and Young promptly began to work on producing a prototype. Young explained that the creation of a medical device prototype proceeds in stages. It begins with sketches, moves on to the creation of digital design files known as computer aided design (CAD) files, and ultimately concludes with the manufacture of a prototype. Lyons testified that, because Aferzon's drawings did not include an adequate mechanism for rotating the blades within the cage, he and Young had to come up with such a mechanism themselves. Young thus prepared a series of sketches based on Aferzon's ideas and eventually came up with a "center shaft design" for rotating the blades, in which the rotating blades were attached to a single shaft that ran through the cage of the device. MDS then created multiple digital design files for a center shaft device and manufactured a prototype of the device using the center shaft design.

Lyons and Young further testified that the center shaft design prototype was tested in a cadaver at the University of Connecticut Health Center in Farmington either toward the end of 2004 or in early 2005. They also testified that Aferzon and Bash were present during the test at the health center when the device was successfully installed in a cadaver using an Allen wrench to rotate the blades into place. Although Aferzon and Bash both testified that they had no recollection of the cadaver test, the court credited the testimony of Lyons and Young on this subject.

After the cadaver test, MDS continued its work on the device, pivoting to a different design. Young began to work on a "rack and pinion"2 design for the device that was safer and more versatile than its predecessor, as it allowed the blades to be reversed more efficiently and prevented them from disengaging. Rather than utilizing a single central shaft on which all of the blades rotated, this second design utilized two geared shafts running through the cage, with three blades affixed to each of them on geared teeth. Lyons explained that the "blades had slots that had teeth that would mesh with the pinions. And, again, when you rotated the pinions, that would engage the rack and rotate the blades. ... One [pinion] would rotate the three ... blades in one direction ... and the other pinion would rotate the blades in the opposite direction." From December, 2004, to May, 2005, MDS prepared and modified several digital design files for the device using the rack and pinion concept....

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    • United States
    • Connecticut Court of Appeals
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    ...after the act complained of is complete ...." (Citation omitted; internal quotation marks omitted.) Medical Device Solutions, LLC v. Aferzon , 207 Conn. App. 707, 753, 264 A.3d 130, cert. denied, 340 Conn. 911, 264 A.3d 94 (2021)."The test for determining whether the continuing course of co......
  • Randolph v. Mambrino
    • United States
    • Connecticut Court of Appeals
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    ...part in filing a complaint on [his] cause of action." (Internal quotation marks omitted.) Medical Device Solutions, LLC v. Aferzon , 207 Conn. App. 707, 745–46, 264 A.3d 130, cert. denied, 340 Conn. 911, 264 A.3d 94 (2021). "[Additionally], the [respondents’] actions must have been directed......
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    ...claim involves a question of law to which we afford plenary review." (Internal quotation marks omitted.) Medical Device Solutions, LLC v. Aferzon , 207 Conn. App. 707, 728, 264 A.3d 130, cert. denied, 340 Conn. 911, 264 A.3d 94 (2021). The following legal principles govern our resolution of......
  • Smith v. Supple
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    ... ... fees on remand); Medical Device Solutions, LLC v ... Aferzon, 207 Conn.App. 707, 782, 264 A.3d 130 ... ...
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1 books & journal articles
  • Offers of Compromise in Civil Actions in Connecticut: Excessively Punitive and Disparate Sanctions
    • United States
    • Connecticut Bar Association Connecticut Bar Journal No. 94, January 2023
    • 1 January 2023
    ...Docket No. X07-HHD-CV18-6103682S, 2020 Conn. Super. LEXIS 1075 (September 21, 2020). [33] Medical Device Solutions, LLC v. Aferzon, 207 Conn. App. 707, 785-86, ---A.3d ---(2021). [34] This computation is based upon the trial court's total judgment of $2,847,343, consisting of breach of cont......

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