Richards Layton & Finger
 

Magistrate Judge Burke Strikes Damages Theory as Untimely

January 30, 2018

In Integra Lifesciences Corp. v. Hyperbranch Medical Technology, Inc., No. 15-819-LPS-CJB (D. Del. Nov. 14, 2017), Magistrate Judge Burke granted in part the defendant’s motion to strike the plaintiffs’ price erosion and market-share apportionment damages theory as untimely.

During discovery, the defendant had sought the plaintiffs’ damages theories and underlying facts. According to the Court, the plaintiffs failed to disclose any such facts, instead taking the position that lost profit damages were presumed because the relevant market was a two-party market. After the close of fact discovery, the plaintiffs’ expert report disclosed damages theories of price erosion and market-share apportionment. The defendant moved to strike these theories from the report on the basis that neither theory was disclosed before expert discovery.

Judge Burke found that the plaintiffs initially disclosed an intention to seek price erosion damages, even though, in response to an interrogatory regarding their damages theories, the plaintiffs did not provide the facts or evidence on which they would rely. Nevertheless, the Court stated that the defendant, having been put on notice, should have sought more information from the plaintiffs or moved to compel if more information was desired. Judge Burke found that the market-share apportionment theory had not been disclosed before expert discovery, however. Further, the damages theory that the plaintiffs had disclosed during fact discovery—that lost profits were presumed in a two-party market—was, according to the Court, inconsistent with a market-share apportionment theory. Additionally, Judge Burke stated that the defendant should not have been expected to guess from materials disclosed during fact discovery that such a theory would be forthcoming. The Court also noted that curing the prejudice could not be accomplished without disrupting the schedule. As a result, Judge Burke granted the motion to strike the market-share apportionment theory of price erosion.

Key Point: The Court emphasized the usefulness of contention interrogatories in defining the issues in dispute in a litigation, and stated that parties should not seek to respond to interrogatories as briefly as possible or defer disclosing their positions until expert reports.