Greenberg v. Miami Children's Hospital Research Institute

264 F. Supp. 2d 1064 (2003)

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Nature of the Case

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Facts

In 1987, Canavan disease still remained a mystery - there was no way to identify who was a carrier of the disease, nor was there a way to identify a fetus with Canavan disease. P approached Dr. Matalon, a research physician who was then affiliated with the University of Illinois at Chicago for assistance. P requested Matalon's (D) involvement in discovering the genes that were ostensibly responsible for this fatal disease so that tests could be administered to determine carriers and allow for prenatal testing for the disease. P and others located other Canavan families and convinced them to provide tissue (such as blood, urine, and autopsy samples), financial support, and aid in identifying the location of Canavan families internationally. Ps began supplying Matalon (D) with the same types of information and samples beginning in the late 1980s. P created a confidential database and compilation - the Canavan registry - with epidemiological, medical and other information about the families. Matalon (D) became associated in 1990 with Ds and continued his relationship with Ps after his move, accepting more tissue and blood samples as well as financial support. Ps allege that they provided Matalon (D) with these samples and confidential information 'with the understanding and expectations that such samples and information would be used for the specific purpose of researching Canavan disease and identifying mutations in the Canavan disease which could lead to carrier detection within their families and benefit the population at large.' Ps further allege that it was their 'understanding that any carrier and prenatal testing developed in connection with the research for which they were providing essential support would be provided on an affordable and accessible basis, and that Matalon's (D) research would remain in the public domain to promote the discovery of more effective prevention techniques and treatments and, eventually, to effectuate a cure for Canavan disease.' A breakthrough occurred in 1993. Matalon (D) and his research team successfully isolated the gene responsible for Canavan disease. After this key advancement, Ps continued to provide Matalon (D) with more tissue and blood in order to learn more about the disease and its precursor gene. In September 1994, unbeknownst to Ps, a patent application was submitted for the genetic sequence that Ds had identified. This application was granted in October 1997, and Dr. Matalon (D) was listed as an inventor on the gene patent and related applications for the Canavan disease. Ds acquired the ability to restrict any activity related to the Canavan disease gene, including without limitation: carrier and prenatal testing, gene therapy and other treatments for Canavan disease and research involving the gene and its mutations. Ps did not learn of the patent until November 1998, when D revealed their intention to limit Canavan disease testing through a campaign of restrictive licensing of the Patent. D began restricting public accessibility through negotiating exclusive licensing agreements and charging royalty fees. Ps allege they were never informed that Ds intended to seek a patent on the research. Nor were they told of Ds' intentions to commercialize the fruits of the research and to restrict access to Canavan disease testing. Ps sued Ds for (1) lack of informed consent; (2) breach of fiduciary duty; (3) unjust enrichment; (4) fraudulent concealment; (5) conversion; and (6) misappropriation of trade secrets. Ds moved to dismiss. The Smith 4^th casebook discusses count 5 only.