The Bimeco Group, Inc. v. Icu Medical, Inc.

MOTION for Partial Summary Judgment on Defendant's Affirmative Defenses of Accord and Satisfaction and Statute of Frauds with Brief In Support

N.D. Ga.July 11, 2016

1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA NEWNAN DIVISION THE BIMECO GROUP, INC., Plaintiff, v. ICU MEDICAL, INC., Defendant. Civil Action File No. 3:15-cv-00123-TCB PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT ON DEFENDANT’S AFFIRMATIVE DEFENSES OF ACCORD AND SATISFACTION AND STATUTE OF FRAUDS Plaintiff, THE BIMECO GROUP, INC. (“Plaintiff”), hereby submits this, its Motion for Partial Summary Judgment as follows: As a matter of law, Plaintiff is entitled to partial summary judgment on Defendant’s affirmative defenses of Accord and Satisfaction (Amended Answer, p. 3, Tenth Affirmative Defense [29]) and Statute of Frauds (Amended Answer, p. 2, Seventh Affirmative Defense [29]) (collectively, the “Affirmative Defenses”) because based on the undisputed facts in the record, ICU cannot meet its burden to prove either of them. ICU erroneously claims the parties entered into an accord and Case 3:15-cv-00123-TCB Document 94 Filed 07/11/16 Page 1 of 6 2 satisfaction that bars Bimeco’s claims for commissions due for the sale of ICU Products to Orlando Regional Healthcare Systems (“ORHS”). The Affirmative Defenses fail because Bimeco never agreed to accept the partial payment of the commissions due for sales to ORHS as a satisfaction of its claims and there was no bona fide dispute over the amount due or consideration given to Bimeco. ICU seeks to apply the Statute of Frauds to bar Bimeco’s claim to enforce ICU’s oral promise to pay 10% commissions on the sale of all ICU Infusion and Chemotherapy Products sold to Children’s Healthcare of Atlanta (“CHOA”) for as long as Bimeco was a Specialty Distributor for ICU, if Bimeco assisted ICU in persuading CHOA to purchase the ICU Products by using its influence with key personnel at CHOA and refraining from selling competitor products to CHOA. As a matter of law, the Statute of Frauds does not apply because the Specialty Distributor relationship between ICU and Bimeco was terminable at will and therefore the oral contract could be performed within a year. Further, Bimeco fully performed its part of the bargain and the contract is subject to exception set forth in O.C.G.A. §§ 13-5-31(b) and (c). In submitting its Motion for Partial Summary Judgment, Bimeco relies on the following documents and evidence in the record which set forth the undisputed facts in support of its Motion: Case 3:15-cv-00123-TCB Document 94 Filed 07/11/16 Page 2 of 6 3 1. the Declaration of Mark Jungers, filed contemporaneously herewith; 2. the Declaration of Sandra Jungers, filed contemporaneously herewith; 3. the Declaration of Stewart Solomon, being filed provisionally under seal; 4. the 30(b)(6) Deposition of The Bimeco Group, Inc.’s corporate representatives, Mark Jungers and Sandra Jungers, taken January 12, 2016, and the exhibits thereto; 5. the 30(b)(6) Depositions of ICU Medical, Inc.’s corporate representatives, Kevin McGrody, taken March 22, 2016, Vincent Sabatino and Kathryn Schiazzano, taken April 20, 2016, and Paul Curtin, taken April 21, 2016, and all exhibits thereto, being filed provisionally under seal; 6. the individual Depositions of Mark Jungers and Sandra Jungers, taken May 9, 2016, and the exhibits thereto; 7. the individual depositions of Stewart Solomon and Rich Cirincione, taken May 10, 2016, and the exhibits thereto; 8. the individual depositions of Mack Cranford and John Canning, taken May 11, 2016, and the exhibits thereto; Case 3:15-cv-00123-TCB Document 94 Filed 07/11/16 Page 3 of 6 4 9. the Deposition of Kristin Jacobs, taken June 2, 2016, and the exhibits thereto, being filed provisionally under seal; and 10. the Deposition of Doug Baran, taken May 24, 2016, and the exhibits thereto, being filed provisionally under seal. For these reasons, Bimeco respectfully moves the Court to grant partial summary judgment as to the affirmative defenses. Dated: July 11, 2016 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94 Filed 07/11/16 Page 4 of 6 5 CERTIFICATE OF SERVICE I hereby certify that on this 11th day of July, 2016, I served the foregoing with the Clerk of Court using the CM/ECF system which will automatically send e-mail notification of such filing to the following attorney(s) of record: Charles C. Murphy, Jr. cmurphy@vaughanandmurphy.com Ellen G. Schlossberg eschloss@vaughanandmurphy.com Vaughan & Muprhy 260 Peachtree Street, N.W., Suite 1600 Atlanta, GA 30303-1237 Henry D. Fellows, Jr. hfellows@fellab.com Christina Baugh cbaugh@fellab.com Fellows LaBriola LLP Suite 2300 South Tower 225 Peachtree Street, N.E. Atlanta, GA 30303 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94 Filed 07/11/16 Page 5 of 6 6 LOCAL RULE 5.1 CERTIFICATION I, JOHN C. PORTER, JR., certify that the foregoing has been prepared in Times New Roman 14 font and is in compliance with United States District Court, Northern District of Georgia Local Rule 5.1. s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94 Filed 07/11/16 Page 6 of 6 1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA NEWNAN DIVISION THE BIMECO GROUP, INC., Plaintiff, v. ICU MEDICAL, INC., Defendant. Civil Action File No. 3:15-cv-00123-TCB PLAINTIFF THE BIMECO GROUP, INC.’S BRIEF IN SUPPORT OF ITS MOTION FOR PARTIAL SUMMARY JUDGMENT AGAINST DEFENDANT ICU MEDICAL, INC. INTRODUCTION THE BIMECO GROUP, INC.’s (“Bimeco”) claims against Defendant ICU MEDICAL, INC. (“ICU”) are best described by the candid assessment Paul Curtin, ICU’s National Sales Director gave his boss in an email dated November 24, 2011. In his email, Mr. Curtin admitted, “In this case a decision was made unilaterally not to pay someone [Bimeco] who helped get a footprint in the hospital. He [Bimeco’s sales representative] was never notified.” (Dep. Ex. 84; Dep. Ex. 212 [ICU 007349-007350]; Jacobs Dep. 179:14-20, June 2, 2016.)1 Since at least 2010, 1 Although Mr. Curtin was referring to ICU’s failure to pay Bimeco commissions due for the sale of ICU Products to ORHS (Amended Compl. ¶ 35–57), the statement basically sums up ICU’s approach to dealing with Bimeco in general. Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 1 of 27 2 ICU has repeatedly and unilaterally decided not to pay Bimeco commissions and rebates owed to Bimeco without justification. ICU’s approach to Bimeco was not based on what ICU agreed to do, but rather what ICU believed it could get away with, including not paying Bimeco earned commissions and rebates. Bimeco believes a jury will see through ICU’s invalid excuses for failing to pay Bimeco what it is justly owed. As part of its attempt to avoid paying Bimeco what it is due, ICU has raised two affirmative defenses to some of Bimeco’s claims: Accord and Satisfaction and Statute of Frauds. (Amended Answer p. 2, 3 [29].) ICU has the burden to prove these defenses at trial. In filing its Motion for Partial Summary Judgment, Bimeco has the burden of showing that as a matter of law based on the undisputed facts in the record, it is entitled to partial summary Judgment Fed. R. Civ. P. 56(c). Calderone v. United States, 799 F.2d 254, 258-59 (6th Cir. 1986). But, in the case of ICU’s affirmative defenses, it need only show that ICU cannot sustain its burden at trial. Wise v. Bandy, No. 2:12-cv-0291-RWS, 2014 WL 645024, at *3 (N.D. Ga. Feb. 18, 2014.) As a result, partial summary judgment should be granted dismissing both of these affirmative defenses. Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 2 of 27 3 A. Background The Bimeco Group, Inc. is a closely held Georgia corporation which was formed in July 2007, as a successor to Bimeco, Inc., a division of LUX Healthcare, Inc., to carry on the business of an independent specialty distributor for medical products made by numerous manufacturers, including ICU. (Bimeco 30(b)(6) Dep. 33:11-23, Jan. 12, 2016.) The main officers and employees of Bimeco are Sandra Jungers (“Ms. Jungers”), President and majority shareholder, her husband, Mark Jungers (“Mr. Jungers”), Executive Vice President, and sales representatives Stewart Solomon (“Mr. Solomon”), Rich Cirincione (“Mr. Cirincione”), and Mack Cranford (“Mr. Cranford”) (collectively, Mr. Solomon, Mr. Cirincione, and Mr. Cranford are referred to as the “Bimeco Sales Reps”). Bimeco and ICU “had an historic supplier-distributor relationship” (the “Relationship”) under a “commission arrangement” that was not evidenced by any single writing signed by both parties, which was terminated by ICU on December 31, 2014. (Joint Prelim. Stmt. p. 6. [7]; Bimeco 30(b)(6) Dep. 16:8-25, 17:1-25, 18:1-24, Jan. 12, 2016.) This Relationship began with Bimeco’s predecessor in interest, a corporation called Bimeco, Inc. (Bimeco 30(b)(6) Dep. 41:11-25, 42:1-8, Jan. 12, 2016.) ICU was one of the manufacturers Bimeco, Inc. represented. In the late 1980s and early 1990s, ICU developed a needleless Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 3 of 27 4 connector and peripheral products, for use in the intravenous insertion of fluids into the body (normally referred to as “Clave Products” or “IV” or “Infusion”). The Clave Products allowed practitioners to connect IV lines without the use of needles and avoid inadvertent needle sticks. With proper use, the Clave Products could also reduce infection rates because of its closed system designs. (Curtin 30((b)(6) Dep. 15:20-25, 16:1-2, Apr. 21, 2016.) In the early 2000s, ICU developed products for use in connection with the safe insertion of toxic chemotherapy chemicals used in connection with the treatment of cancer (“Chemo Products”). (Curtin 30((b)(6) Dep. 14:23-25, 14:1-11, Apr. 21, 2016.) B. Direct Sales Commission In the late 1990s and early 2000s, ICU continued to grow and introduce new Clave Products (also referred to as “IV” or “Infusion Products”), as well as new valve technology for Chemo Products. In addition, ICU started entering into pricing agreements with Group Purchasing Organizations (“GPOs”) which were groups large hospitals and hospital systems which banded together to buy products in volume to reduce costs. (Curtin 30((b)(6) Dep. 25:11-24, Apr. 21, 2016.) Under the GPO agreement, ICU sold products directly to end users (“Direct Sales”) through warehousing distributors that simply stored the ICU product, were not involved in sales, and were commonly referred to simply as “Box Movers.” (Curtin Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 4 of 27 5 30((b)(6) Dep. 18:13-25, 19:1-11, Apr. 21, 2016.) In making these Direct Sales through the Box Movers, ICU recognized that “Specialty Distributors” such as Bimeco, and its predecessor, Bimeco, Inc., were still a “valuable part of the ICU sales team” that could use their “local relationships and clinical expertise” to help separate ICU from other competitors. (Dep. Ex. 121; Decl. Solomon ¶ 23; Curtin 30(b)(6) Dep. 35:16-23, Apr. 21, 2016.) ICU relied upon its Specialty Distributors to assist with sales because the internal ICU sales team had “too much territory to cover” and needed the Specialty Distributors’ local knowledge and contacts. (Sabatino 30(b)(6) Dep. 131:14-18, Apr. 20, 2016.) ICU also understood that the Specialty Distributor expected to be compensated for assistance in making Direct Sales in the form of commissions when the Specialty Distributor participated in the sale. (M. Jungers Dep. 8:22-25, 9:3-10, 76:14-25, 77:1, May 10, 2016; Sabatino 30(b)(6) Dep. 77:24-25, 78:1, Apr. 20, 2016; Decl. Solomon ¶¶ 24, 26.) In the case of Direct Sales, when the Specialty Distributor used its local contacts and clinical expertise to help ICU sell its products, ICU agreed to pay Bimeco a monthly commission of 15% on the sales of all products to the end user. The 15% commission on sales of ICU products was owed as long as the products were sold to the end user and the specialty distributor relationship with ICU continued. (M. Jungers Dep. 130:20-25, 131:1-15, May 10, 2016; Jacobs Dep. 85:1-17, 177:19-25, Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 5 of 27 6 178:1-5, June 2, 2016; Dep. Ex. 148; Decl. Solomon ¶¶ 24, 25.) Based on a “general agreement” between ICU and the Specialty Distributors, ICU recognized the 15% as its’ “standard guideline” commission for Specialty Distributors which could be changed by mutual agreement between the ICU sales representative and the Specialty Distributor representative before the Specialty Distributor representatives assisted in selling the ICU product to the end user. (Bimeco 30(b)(6) 26, 27:1-8, 38:10-25, 39:1-15, 41:19-22, Jan. 12, 2016; Curtin 30(b)(6) Dep. 36:19-25, 37:1-22, 38:21-25, 39:1-16, Apr. 21, 2016; Sabatino (30(b)(6) Dep. 156:16-24, 147:22-25, 148:1, Apr. 20, 2016; Jacobs Dep. supra, 178:3-8; Dep. Ex. 212 [ICU 007380 – 007382]; Solomon Decl. ¶ 24.) C. Direct Sales Commissions for MedAsset GPOs In 2003, Mark Jorgensen, ICU’s Director of National Accounts, announced to all its specialty distributors, including Bimeco’s predecessor in interest, the Jungers, and the Bimeco Sales Reps, a deviation from the Direct Sales standard commission agreement for sales to members of GPOs called “MedAssets” (the “MedAssets Agreement”). (Dep. Ex. 77A; Decl. Solomon ¶¶ 11, 12, 24; Decl. M. Jungers ¶ 12; Curtin 30(b)(6) Dep. 28-30, Apr. 21, 2016.) Mr. Jorgensen confirmed Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 6 of 27 7 the deal in a letter passed on to Specialty Distributors, including Bimeco, Inc.,2 which stated “If MA [MedAsset] members choose to get the boxes from a wholesaler [the Direct Sales method], ICU will pay you [Specialty Distributor] a monthly commission. The structure will be 15% on Clave items, 10% on blunt cannula items and 8% on commodity items [product that did not include a clave connector].” (Hereinafter referred to as the “MedAssets Letter”). Id. Thus, under the MedAssets Agreement, while Specialty Distributors would receive the standard 15% commission on Clave Products, ICU, in advance, dropped the commission it agreed to pay on non-Clave commodity items to 8%. (Bimeco 30(b)(6) Dep. 26:10-25, 27:1-8, Jan. 12, 2016; M. Jungers Dep. 89:1-23; Decl. Solomon ¶ 12.) Bimeco, Inc., the Jungers, and the Bimeco Sales Reps proceeded to attempt to sell ICU products to MedAsset members based in reliance upon ICU’s promise. (Decl. M. Jungers ¶ 16; Decl. Solomon ¶¶ 10, 11, 12.) D. Bimeco Assumed an Historical Specialty Distributor Position with ICU In July 2007, LXU Healthcare, Inc., Bimeco Inc.’s controlling company, elected to discontinue its operation in the southeast. (S. Jungers Dep. 69:19-25, 2 This letter was distributed to the ICU sales force, including ICU sales reps such as Mike Lester, who were instructed to pass the letter on to the Bimeco Sales Reps. (Decl. Solomon ¶¶ 10, 11; Decl. M. Jungers ¶ 12; Dep. Ex. 121.) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 7 of 27 8 70:1-25, 71:1-11, May 9, 2016.) The Jungers and the Bimeco Sales Reps formed The Bimeco Group, Inc. (“Bimeco”) and assumed all the contracts and relationships with manufacturers, including ICU, under the same terms and conditions as they had operated under as a division of LXU. (Bimeco 30(b)(6) Dep. 41:11-25, Jan. 12, 2016.) ICU, through its national sales manager, Paul Curtin, and Bimeco, through Mr. Jungers, agreed that Bimeco would proceed as a Specialty Distributor representative as Bimeco, Inc. had done before. (Bimeco 30(b)(6) Dep. 41:5-25, Jan. 12, 2016.) The transition was seamless. (Decl. Solomon ¶ 21.) Bimeco proceeded with its Specialty Distributor relationship and conducted business as usual with ICU from August of 2007 to the termination of the relationship on December 31, 2014.3 (Decl. Solomon ¶ 21.) E. Conversion of Orlando Regional Health System (“ORHS”) to ICU Clave and Chemo Products One of the claims alleged by Bimeco involves the sale of ICU’s IV Infusion (or Clave) and Chemo Products to ORHS. (Amended Compl. ¶¶ 35–57 [28].) ICU 3 See, Cent. Of Georgia Ry. Co. v. Woolfolk Chem. Works, Ltd., 122 Ga. App. 789, 178 S.E.2d 710, 711 (1970) (Where a contract or undertaking is personal, it binds only the original parties and those who may assume the obligation or ratify or adopt the contract, even though the contract contains a provision that it is binding upon the successors and assigns of one of the contracting parties.) (Emphasis added.) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 8 of 27 9 has erroneously alleged this claim is barred by the affirmative defense of Accord and Satisfaction. Bimeco submits that, based on the undisputed facts in the record, as a matter of law ICU is wrong. ORHS is a group of nine hospitals in Orlando, Florida, which formed a buying group for the purpose of purchasing products at a higher volume so they could get lower prices. (Jacobs Dep. 18:10-17, June 2, 2016.) In 2002, Ms. Jungers and Mr. Solomon, while working for Bimeco’s predecessor, introduced the first Clave Products into ORHS as part of a project to rewrite the neonatal intensive care unit (“NICU”) infection prevention protocols. Use of these protocols and the Clave Products resulted in a substantial reduction in NICU infection rates compared to the rest of the hospital. (Decl. Solomon ¶¶ 5–9; Dep. Ex. 85.) In the fall of 2006, ICU hired a former registered nurse, Kristin Jacobs, to be the sole ICU in-house sales representative for the entire state of Florida. ICU later added a second, junior sales representative to assist her. (Jacobs Dep. 8:21-24, 9:12-13, 14:10-18, June 2, 2016.) Ms. Jacobs relied heavily on the Bimeco Sales Reps, including Stewart Solomon, to help her cover her sales territory. (Jacobs Dep. 85:1-7, June 2, 2016.) As an example, on or about January 25, 2007, in an email to Mr. Solomon, Ms. Jacobs asked Mr. Solomon “are you able to get me into Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 9 of 27 10 ORMC4 . . . they are secondary MedAssets.” (Emphasis added.) Ms. Jacobs asked Mr. Solomon to introduce her to all his contacts in all departments in ORHS because she wished to team up with Bimeco and Mr. Solomon to sell the full line of ICU infusion, chemotherapy, and dialysis products to ORHS system wide. (Jacobs Dep. 17:5-25 – 26:1-12, June 2, 2016.) As requested by the MedAssets Letter, Mr. Solomon used his “local relationships and expertise” to assist Ms. Jacobs in meeting key personnel in the adult trauma units, nursing, infection control, materials acquisition, and oncology units in order to sell Infusion and Chemo Products to ORHS. (Jacobs Dep. 21–26:8, June 2, 2016; Dep. Ex. 172; Decl. Solomon ¶ 18.) For the next two years, Mr. Solomon and Ms. Jacobs, undertook a team effort, along with other ICU employees, to sell the full line of ICU Clave and Chemo Products into ORHS system-wide. Mr. Solomon participated in all in-services training programs, as well as all quality control trials of the Infusion and Chemo Products at ORHS. (Decl. Solomon ¶ 33; Jacobs Dep. 140:24-25, 141:1-25, 142:1-24, 143:1, June 2, 2016.) In short, Mr. Solomon and Bimeco played an essential role in persuading ORHS to purchase the full line of ICU Clave 4 ORMC is ORHS’s main hospital and the two terms, “ORMC” and “ORHS,” were used interchangeably. (Jacobs Dep. 21:1-10, June 2, 2016.) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 10 of 27 11 and Chemo Products system-wide by the fall of 2009. (Jacobs Dep. 144:18-25, 145:1-2, June 2, 2016, Decl. Solomon ¶ 34; Dep Ex. 81 [ICU 007349].) Based on his full participation in ORHS project, Mr. Solomon and Bimeco expected to be paid 15% on sales of all ICU Clave and Chemo Products and at least 8% (instead of the normal 15%) on sales of non-clave commodity products. Kristin Jacobs, the ICU sales representative charged by ICU with discussing commission rates with Mr. Solomon, on behalf of Bimeco, was aware of Mr. Solomon’s and Bimeco’s expectation and shared that expectation. (Jacobs Dep. 85:1-15, June 2, 2016; Decl. Solomon ¶¶ 15, 24, 26, 56.) Neither she nor any other ICU representative told to Mr. Solomon or Bimeco they would not receive the standard 15% commission or offered a different commission rate. (Curtin 30(b)(6) Dep. 85:15-19, Apr. 21, 2016; Decl. Solomon ¶ 26; Jacobs Dep. 180:13-17, June 2, 2016.) After ORHS agreed to purchase ICU Products system-wide, Ms. Jacobs attempted to submit ICU’s internal Relationship Form providing for payment of commissions to Bimeco on Clave and Chemo Products, but got her “hand slapped” by her supervisors. (Jacobs Dep. 172:14-21, June 2, 2016; Dep. Ex. 82 [ICU 007350].) No commissions were paid to Bimeco in 2010. (Decl. Solomon ¶¶ 56, 58.) Responding to numerous complaints from Mr. Solomon, Ms. Jacobs reported Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 11 of 27 12 to her boss, Paul Curtin, that Mr. Solomon and Bimeco were justifiably unhappy. She stated “at no time was Stewart [Solomon] or Bimeco made aware that they would not be paid for any or all of the business.” (Jacobs Dep. 177:11-15, June 2, 2016; Dep. Exs. 81, 212.) Mr. Curtin admitted excluding Bimeco had been a “mistake.” He told Ms. Jacobs that he would pay Bimeco a commission on the Clave and Clave peripheral business, which included all of the Clave Products sold to ORHS. (Dep. Ex. 81 [ICU 007351]; Curtin 30(b)(6) Dep. 95:3-17, Apr. 21, 2016; Jacobs Dep. 167:21-25, 168:1-21, June 2, 2016.) Mr. Curtin arbitrarily excluded Chemo Products even though Bimeco participated in the sale. Id. According to ICU’s records, the total sales of ICU Clave Products to ORHS for 2009 through March 1, 2011 (“Proposed Payment Period”) equaled $1,390,4715 from the sale of at least 24 different Clave Products. Bimeco should have received a 15% commission, or $208,570.65, for those sales in the Proposed Payment Period. (Decl. M. Jungers ¶ 5; Dep. Exs. 20 and 22.) Instead, Mr. Curtin selected six Clave Products with total sales of $514,700 from October 2009 5 In 2010, ICU Chemo Products were withdrawn and not sold to ORHS because their connectors were incompatible with other products used by ORHS. They were reintroduced to ORHS in July 2012. (Dep. Ex. 117.) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 12 of 27 13 through January 2011, and calculated a 15% commission of $77,205. (Curtin 30(b)(6) Dep. 100:17-25; 101 – 106:1-13; Dep. Exs. 82 [ICU 005650 – 005651].) But ICU declined to even pay the commissions originally suggested by Mr. Curtin. After a discussion between Mr. Curtin and Rich Costello, ICU’s Vice President of Sales, ICU proposed an initial partial payment as follows: “We will pay $30,000 dollars to Bimeco for past commissions on Clave business at ORMC. . . . We will pay 10% on clave business going forward at ORMC (clave, and clave extension sets) for the remainder of 2011.” (emphasis added) (the “Partial Payment Offer”). (Decl. M. Jungers ¶¶ 7-13; Dep. Ex. 87 [ICU 006707]; Curtin 30(b)(6) Dep. 172:21-25, 173:1-25, Apr. 21, 2016.) Significantly, there was no language in the email indicating that the Partial Payment Offer was a final satisfaction of ICU’s obligation to Bimeco’s commission. Mr. Jungers objected to the Partial Payment Offer as being inadequate as an initial payment and questioned the figure as being too low because he believed the sales of Clave Products should have been higher than $300,000 (requiring a higher commission even at 10%). Mr. Curtin did not reveal the actual sales figures to Mr. Jungers. Instead, he falsely told Mr. Jungers that the $30,000 represented 10% of total sales revenue of nine (9) Clave Products equaling $300,000 which were the only Clave Products ORHS was purchasing. Yet Mr. Curtin knew that the sales Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 13 of 27 14 revenues from just six (6) Clave Products sold to ORHS in that period exceeded $300,000 by over 70% and that ORHS was by far purchasing more Clave Products than the nine (9) Clave Products represented to Bimeco. (Decl. M. Jungers ¶ 5-12; M. Jungers Dep. 71:9-19, May 9, 2016; Curtin 30(b)(6) Dep. 172:21-25, 175:15- 25, 176:1-14, Apr. 21, 2016; Dep. Ex. 87.) Finally, in response to Mr. Jungers’ objection that the Partial Payment Offer was too low, both Mr. Curtin and Mr. Costello agreed the proposal was not intended to be a full and final payment of all amounts due. Mr. Curtin and ICU agreed that ICU would pay additional commissions over the amount they were currently offering for both Clave and Chemo Products in the future once they were able to better assess the purchasing trends of sales of ORHS on “a case by case basis.” (Curtin 30(b)(6) Dep. 179:2-13, Apr 21, 2016, M. Jungers Dep. 87:8-25, 88:1-25, May 9, 2016.) Bimeco accepted payments under the Partial Payment Offer only because they understood that this was just the beginning of discussions on getting ORHS commissions paid. F. ICU promises Bimeco a commission of 10% of sales of Chemo and Infusion Products to Children’s Healthcare of Atlanta (“CHOA”) As with sales of ICU Products to ORHS, ICU again “unilaterally decided not to pay” commissions that had been promised to Bimeco on sales of ICU Products to CHOA from 2012 through December 31, 2014. Instead, like the ORHS commissions, ICU sought to get away with paying a mere fraction of the total Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 14 of 27 15 amount actually due. ICU now erroneously contends that Bimeco’s claims for commissions for the sale of Chemo and Infusion Products are barred by the Statute of Frauds. Again, based on the undisputed facts in the record, Bimeco’s claims are not barred by the Statute of Frauds. From 2009 to 2011, ICU attempted to sell IV Infusion and Chemotherapy Products to Children’s Healthcare of Atlanta (“CHOA”) without success. (Def’s Response to Pl’s First Requests for Admission ¶ 20.] ICU placed a high priority on converting CHOA to ICU products. CHOA was not only perceived to be a high volume client but a high profile customer that could help ICU sell product to other children’s hospitals. (Sabatino 30(b)(6) Dep. 40:19-22, 41:20-25, 42:1-25, 43:1-25, Apr. 20, 2016; Dep. Ex. 37.) As with ORHS, ICU sales representatives sought to use Bimeco’s local contacts and clinical expertise to sell CHOA Infusion and Chemo Products. (Sabatino 30(b)(6) Dep. 85:2-10, Apr. 20, 2016; Decl. S Jungers Decl. ¶ 6.) Bimeco and Sandra Jungers had a long standing relationship with a number of CHOA personnel involved in the approval and purchasing of new products, including Donna Peace, the head nurse in charge of infection control. Donna Peace was the Director of Infection Control for CHOA, the approval of which is integral to all accounts. (Sabatino 30(b)(6) 118:14-19, Apr. 20, 2016; Bimeco 30(b)(6) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 15 of 27 16 Dep. 148:24-23, 149:1-23, Jan. 12, 2016.) Before the summer of 2011, Donna Peace was the main opponent to the use of ICU infusion products at CHOA. (Email from David Webb to Bruce Dragish, Mr. Webb’s boss, dated February 24, 2011. [ICU 0299930].) (S. Jungers Dep. 44:1-25, May 9, 2016.) ICU was aware of Ms. Jungers’ professional relationship with Ms. Peace. (Sabatino 30(b)(6) Dep. 101:2-23, Apr. 20, 2016.) Bimeco contends and ICU disputes that ICU representative, Vincent Sabatino approached Ms. Jungers and offered to pay her 10% of all sales revenues of ICU IV Infusion and Chemo Products sold to CHOA for as long as Bimeco maintained a Specialty Distributor Relationship with ICU, if Ms. Jungers would: (1) use her contacts and influence to persuade key decision makers at CHOA including, but not limited to, Donna Peace, to consider and trial ICU Infusion and Chemo Products, and (2) refrain from attempting to sell products that potentially competed with the ICU product line. (Decl. S. Jungers ¶ 6; Sabatino 30(b)(6) Dep. 87:6-21, Apr. 20, 2016; S. Jungers Dep. 11:7-25, 12:1-25, 13:1-25, May 9, 2016.) Ms. Jungers did everything ICU asked her to do in connection with the sale of ICU Infusion and Chemo Products to CHOA. (Decl. S. Jungers ¶ 11.) Ms. Jungers used her influence on CHOA personnel and refrained from attempting to sell competitive products. (S. Jungers Dep. 38:1-12, May 9, 2016; Decl. S. Jungers Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 16 of 27 17 ¶ 8.) She met with Donna Peace and discussed ICU Products on a number of occasions. (Decl. S. Jungers ¶ 9.) She provided CHOA with sample products and worked to answer questions about the products raised by CHOA. (Decl. S. Jungers ¶ 10.) In addition, as requested, Ms. Jungers gave up potential sales commission revenue by refraining from introducing any products which might be seen as competition to ICU’s Products. (Bimeco 30(b)(6) 151:3-25, 152:6-25, 153:1-17, Jan. 12, 2016; S. Jungers Dep. 31:24-25, 32:1-11, May 9, 2016.) ICU did not notify Ms. Jungers of the trial and in-service schedule for CHOA, and specifically requested that she not participate in the trials or price negotiations and Ms. Jungers complied. (Decl. S. Jungers ¶ 12.) In 2013, ICU began to sell its Infusion Products to CHOA. Total product sales from January 1, 2012, to December 31, 2014, the end of Bimeco’s Specialty Distributor relationship with ICU, equaled $2,190,484. (Dep. Ex. 24, McGrody 30(b)(6) Dep. 140:9-25, 141:1-28, Mar. 22, 2016.) Bimeco and Ms. Jungers contend Bimeco is owed a 10% commission, or $219,048.40, for sales through December 31, 2014, the date of the termination of Bimeco’s Specialty Distributor relationship with ICU.6 Yet ICU only paid Bimeco a commission of $1,294.05 for 6 ICU does not deny Bimeco and Ms. Jungers are entitled to commissions for their efforts in assisting ICU with the sale to CHOA. Instead, as with commissions due Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 17 of 27 18 the sale of two ICU products to one of the CHOA hospitals for one month during that period. (Dep. Ex. 18, p. 156 [see A1009 and MC100 to Children’s Healthcare of Atlanta Scottish Rite].) Bimeco seeks payment of the remaining $217,848.40 in commissions owed for sales of ICU infusion and chemotherapy products to CHOA from 2013 through December 31, 2014. ARGUMENT AND CITATION OF LAW I. ICU’S AFFIRMATIVE DEFENSE OF ACCORD AND SATISFACTION FOR ORHS COMMISSIONS DUE TO BIMECO FAILS AS A MATTER OF LAW ICU’s affirmative defense of accord and satisfaction in connection with its claim for commissions owed for sales to ORHS fails as a matter of law for a number of reasons. First, there was never a meeting of the minds. Bimeco never agreed to nor intended to accept, and ICU never conditioned acceptance of, the Partial Payment Offer as a full and final satisfaction of all amounts due for ORHS commissions. “An accord and satisfaction is an agreement between two parties to give and accept something in satisfaction of a right of action which one has against on the ORHS sales, ICU seeks to unilaterally reduce the amount due from $217,848 for revenue generated for one year on eight (8) Clave and Chemo Products sold to CHOA of the more than 24. Yet ICU has never even tendered the reduced amount to Bimeco. (Sabatino 30(b)(6) Dep. 186:3-25, 187:1-8, 194:10-25, 195:1-25, 196:1-25, Apr. 20, 2016.) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 18 of 27 19 the other.” Withington v. Valuation Group, Inc., 249 Ga. App. 8, 11, 547 S.E.2d 594, 596 (2001); see also O.C.G.A. § 13-4-103. As with other contracts, there must be a showing that a meeting of the minds took place. See, e.g., King Industrial Realty, Inc. v. Rich, 224 Ga. App. 629, 632, 481 S.E.2d 861, 865 (1997) (no accord and satisfaction where there was nothing to indicate that the parties intended to settle their dispute). In May 2011, ICU knew it already owed Bimeco over $200,000 in commissions. (Dep. Exs. 20 and 22.) The undisputed evidence conclusively shows that the Partial Payment Offer was not conditioned upon or intended to be a full satisfaction of the debt owed for ORHS commissions in the past or the future. Bimeco only accepted the Partial Payments because ICU agreed to leave open the question of how much ICU remained obligated to pay both for Infusion Products as well as Chemo Products, once they were re-introduced into ORHS. (Decl. M. Jungers ¶¶ 12-14; Curtin 30(b)(6) Dep. 179:2-13, Apr. 21, 2016.) ICU did not tender the Partial Payments upon the condition of satisfaction of the debt. Rather, ICU tendered the Partial Payments as a temporary measure to get some kind of payment started to Bimeco while it developed a better understanding of sales of its products to ORHS. (M. Jungers Dep. 87:10-25, 88, May 9, 2016.) In addition, there was no bona fide dispute that Bimeco was owed 15% commission on all sales of Chemo and Infusion Products to ORHS. It is undisputed Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 19 of 27 20 that Bimeco and Stewart Solomon played an essential role in persuading ORHS to purchase both ICU Infusion and Chemo Products.7 (Jacobs Dep. 52:24-33, 76:8- 14, 127:1-7, 166:1-11, 178:18-23, June 2, 2016; Dep. Ex. 81; Decl. Solomon ¶ 31.) It is undisputed that Bimeco and Mr. Solomon performed their services with the understanding that Bimeco would be paid 15% of Clave and Chemo product sales revenue and 8% on commodity products, and no one at ICU ever told them different before they performed the services. It is further undisputed that Kristin Jacobs, ICU’s representative who was authorized to discuss commission payments with Mr. Solomon on behalf of ICU, knew that Bimeco and Mr. Solomon expected to be paid 15% and agreed with that expectation. ICU executives declined to pay Bimeco because they wanted higher profit margins. “The intention of the parties may differ among themselves. In such case, the meaning placed on the contract by one party and known to be thus understood by the other party at the time shall be held as the true meaning.” O.C.G.A. § 13-2-4. See Logistec USA, Inc. v. Daewoo Int’l Corp., No. CV213-027, 2014 WL 5025794, at *8 (S.D. Ga. Sept. 30, 2014) (definition of equipment by one party known by the other prevails). ICU cannot 7 While 30(b)(6) witness Paul Curtin attempted to deny this, his testimony lacks foundation, he had no firsthand knowledge of Mr. Solomon’s activities and made no attempt to investigate. He did not even ask former Florida field representative, Kristin Jacobs. (Curtin 30(b)(6) Dep. 161:1-25, 162:13-22, 163:1, Apr. 21, 2016.) Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 20 of 27 21 unilaterally change the contract after the fact based on subjective undisclosed reservations. Aside from a meeting of the minds which was not present in this case, “accord and satisfaction also requires that parties have a bona fide dispute prior to tender of any amount less than what is due.” Lumsden v. Williams, 307 Ga. App. 163, 169, 704 S.E.2d. 458, 464 (2010). Otherwise, an accord and satisfaction must be of some advantage, legal or equitable, to the creditor or it shall not have the effect of barring him from his legal rights under the original agreement.” O.C.G.A. § 13-4-102. In the instant case, there was never a bona fide dispute about what was due, nor any new advantage to Bimeco in receiving a portion of what was already due. As a matter of law, ICU’s accord and satisfaction defense does not apply to Bimeco’s claim for ORHS commissions. For these reasons and based on the undisputed facts in the record, Bimeco is entitled to partial summary judgment on ICU’s affirmative defense of accord and satisfaction. II. BIMECO’S CLAIM FOR COMMISSIONS DUE FOR SALES OF IV INFUSION AND CHEMO PRODUCTS INTO CHOA ARE NOT BARRED BY THE STATUTE OF FRAUDS As a matter of law, Bimeco’s claim for a 10% commission on sales of ICU products to CHOA, is not barred by the affirmative defense of Statute of Frauds Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 21 of 27 22 under O.C.G.A. § 13-5-30 because it is based on an agreement which was capable of being performed in less than a year and because two exceptions to the Statute of Frauds under O.C.G.A. § 13-5-31 apply. While ICU may claim to dispute the terms of the agreement to pay Bimeco commissions as a matter of law, it cannot meet its burden of proving the claim is covered by the Statute of Frauds. As an initial matter, Georgia law recognizes that oral contracts falling outside the purview of the Statute of Frauds may be binding and enforceable. See Cochran v. Eason, 227 Ga. 316, 318(1), 180 S.E.2d 702, 704 (1971) (holding that “[a]ssent to the terms of a contract may be given other than by signatures”); Pacrim Assocs. v. Turner Home Entertainment, 235 Ga. App. 761, 764-766(1), 510 S.E.2d 52 (1998) (breach of contract claim based upon evidence of a binding oral agreement); Danfair Properties v. Bowen, 222 Ga. App. 425, 474 S.E.2d 295 (1996) (affirming jury verdict awarding plaintiff commissions based upon an oral employment agreement); Merry v. Ga. Big Boy Mgmt., 135 Ga. App. 707, 708(1), 218 S.E.2d 694 (1975) (same). Even complex or expensive contracts may be oral, as long as the evidence establishes the parties' mutual assent to all essential terms of the contract. See, e.g., Turner Broad. Sys., Inc. v. McDavid, 303 Ga. App. 593, 597-97, 693 S.E.2d 873, 877-78 (2010). Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 22 of 27 23 ICU’s promise to pay Bimeco 10% of CHOA sales revenue does not fall under any of the categories of contracts set forth in O.C.G.A. § 13-5-30 for which a signed writing is required. Specifically, a signed writing is not required and O.C.G.A. § 13-5-30(5) does not apply because the agreement can be performed with one year. ICU was obligated to pay Bimeco commission for sales to CHOA up to the date ICU or Bimeco terminated the Specialty Distributor Relationship. (Decl. S Jungers ¶ 6.) Because there is no complete signed written contract establishing a set duration for that Specialty Distributor Relationship or its termination date (as ICU established on December 31, 2014), the relationship was terminable at will by either party. See Loy’s Office Supplies, Inc. v. Steelcase, Inc., 174 Ga. App. 701, 702, 331 S.E.2d 75 (1985) (distributorship with indefinite duration is terminable at will). Therefore, the Relationship could have been terminated at any time, including any time within a year from the date ICU promised to pay Bimeco and Ms. Jungers a 10% commission on CHOA sales revenues. As a result, ICU’s obligation to pay Bimeco commissions could be performed within a year and is not subject to the Statute of Frauds. See Atlanta Dairies Co-op v. Grindle, 182 Ga. App. 409, 510-11, 356 S.E.2d 42, 44 (1987) (“Thus, the Statute of Frauds would have no application in cases involving ‘a contract to begin in praesenti, for an indefinite period terminable at will, and the Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 23 of 27 24 employee thereunder [is] suing on the contract for the amount of compensation due him, based upon services actually performed by him up to the time of his discharge, and not for damages or for compensation for services not performed or for any breach of contract.’ ”); Blum v. Air Ctr. Gwinnett, Inc., 201 Ga. App. 313, 315, 411 S.E.2d 88, 90 (1991) ([O.C.G.A. § 13-55-30] is not applicable to an agreement for an indefinite period terminable at will or where there is a possibility of performance in one year. See also Parker v. Crider Poultry Inc., 275 Ga. 361, 565 S.E.2d 797 (2002). In addition, it is undisputed that Bimeco and Ms. Jungers fully performed the requirements for earning the commission. Nor does ICU dispute that it intended to pay Bimeco and Ms. Jungers a commission for her services. ICU just disputed how much is due. (Sabatino 30(b)(6) Dep. 173:14-25, 181:9-25, Apr. 20, 2016; Dep. Ex. 54, Dep. Ex. 76.) Because Ms. Jungers performed her part of the bargain, under O.C.G.A. §§ 13-5-31(b) and (c), O.C.G.A. § 13-5-30 does not apply. Criswell v. Intellirisk Mgmt Corp., No. 1:08-CV-1686-WSD, 2015 WL 1888311, at *2 (N.D. Ga. Apr. 15, 2015). For the reasons set forth above, as a matter of law the affirmative defense of Statute of Frauds does not bar Bimeco’s claim for commissions on sales to CHOA, ORHS, or any other claim. Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 24 of 27 25 Dated: this 11th day of July, 2016 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7716 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 25 of 27 26 CERTIFICATE OF SERVICE I hereby certify that on this 11th day of July, 2016, I served the foregoing with the Clerk of Court using the CM/ECF system which will automatically send e-mail notification of such filing to the following attorney(s) of record: Charles C. Murphy, Jr. cmurphy@vaughanandmurphy.com Ellen G. Schlossberg eschloss@vaughanandmurphy.com Vaughan & Muprhy 260 Peachtree Street, N.W., Suite 1600 Atlanta, GA 30303-1237 Henry D. Fellows, Jr. hfellows@fellab.com Christina Baugh cbaugh@fellab.com Fellows LaBriola LLP Suite 2300 South Tower 225 Peachtree Street, N.E. Atlanta, GA 30303 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 26 of 27 27 LOCAL RULE 5.1 CERTIFICATION I, JOHN C. PORTER, JR., certify that the foregoing has been prepared in Times New Roman 14 font and is in compliance with United States District Court, Northern District of Georgia Local Rule 5.1. s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94-1 Filed 07/11/16 Page 27 of 27 1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA NEWNAN DIVISION THE BIMECO GROUP, INC., Plaintiff, v. ICU MEDICAL, INC., Defendant. Civil Action File No. 3:15-cv-00123-TCB PLAINTIFF’S STATEMENT OF MATERIAL FACTS NOT IN DISPUTE 1. THE BIMECO GROUP, INC. (“Bimeco”) is a corporation organized under the laws of the State of Georgia, with its corporate office located at 200 Kelly Drive, Suite A, Peachtree City, Fayette County, Georgia 30269, is subject to the jurisdiction and venue of this Court. (Amended Compl. ¶ 1 [28]; Amended Answer ¶ 1 [29].) 2. In an email dated November 24, 2011 (“Nov. 24, 2011 Email”), Paul Curtin, ICU MEDICAL, INC.’s (“ICU”) National Sales Director admitted, “In this case a decision was made unilaterally not to pay someone [Bimeco] who helped get a footprint in the hospital. He [Bimeco’s sales representative] was never notified.” (Dep. Ex. 84; Dep. Ex. 212 [ICU 007349-007350]; Jacobs Dep. 179:14-20, June 2, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 1 of 46 2 3. In the Nov. 24, 2011 Email Mr. Curtin was referring to ICU’s failure to pay Bimeco commissions due for the sale of ICU Products to ORHS (Amended Compl. ¶ 35–57). 4. The Bimeco Group, Inc. was formed in July 2007, as a successor to Bimeco, Inc., a division of LUX Healthcare, Inc. (“LXU”), to carry on the business of an independent specialty distributor for medical products made by numerous manufacturers, including ICU. (Bimeco 30(b)(6) Dep. 33:11-23, Jan. 12, 2016.) 5. The main officers and employees of Bimeco are Sandra Jungers (“Ms. Jungers”), President and majority shareholder, her husband, Mark Jungers (“Mr. Jungers”), Executive Vice President, and sales representatives Stewart Solomon (“Mr. Solomon”), Rich Cirincione (“Mr. Cirincione”), and Mack Cranford (“Mr. Cranford”) (collectively, Mr. Solomon, Mr. Cirincione, and Mr. Cranford are referred to as the “Bimeco Sales Reps”). (Bimeco (30(b)(6) Dep. 129:1-25, 130:1- 2, Jan. 12, 2016; Cranford Dep. 7:1-25, May 11, 2016; Cirincione Dep. 6:15-25, May 10, 2016; Solomon Dep. 9:1-8, May 10, 2016.) 6. ICU and Bimeco “had an historic supplier-distributor relationship” (the “Relationship”) under a “commission arrangement” that was not evidenced by any single writing signed by both parties, which was terminated by ICU on December Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 2 of 46 3 31, 2014. (Joint Prelim. Stmt. p. 6. [7]; Bimeco 30(b)(6) Dep. 16:8-25, 17:1-25, 18:1- 24, Jan. 12, 2016.) 7. This Relationship began with Bimeco’s predecessor in interest, a corporation called Bimeco, Inc. (Bimeco 30(b)(6) Dep. 41:11-25, 42:1-8, Jan. 12, 2016.) 8. ICU was one of the manufacturers Bimeco, Inc. represented. In the late 1980s and early 1990s, ICU developed a needleless connector and peripheral products, for use in the intravenous insertion of fluids into the body (normally referred to as “Clave Products” or “IV” or “Infusion”). The Clave Products allowed practitioners to connect IV lines without the use of needles and avoid inadvertent needle sticks. With proper use, the product could also reduce infection rates because of its closed system designs. (Curtin 30((b)(6) Dep. 15:20-25, 16:1-2, Apr. 21, 2016.) 9. In the early 2000s, ICU developed products for use in connection with the safe insertion of toxic chemotherapy chemicals used in connection with the treatment of cancer (“Chemo Products”). (Curtin 30((b)(6) Dep. 14:23-25, 14:1-11, Apr. 21, 2016.) 10. In the late 1990s and early 2000s, ICU continued to grow and introduce new Clave Products (also referred to as “IV” or “Infusion Products”), as well as new Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 3 of 46 4 valve technology for Chemo Products. In addition, ICU started entering into pricing agreements with Group Purchasing Organizations (“GPOs”) which were groups of large hospitals and hospital systems which banded together to buy products in volume to reduce costs. (Curtin 30((b)(6) Dep. 25:11-24, Apr. 21, 2016.) 11. Under the GPO agreement, ICU sold products directly to end users (“Direct Sales Method”) through warehousing distributors that simply stored the ICU product, were not involved in sales, and were commonly referred to simply as “Box Movers.” (Curtin 30((b)(6) Dep. 18:13-25, 19:1-11, Apr. 21, 2016.) 12. In making these Direct Sales through the Box Movers, ICU recognized that “Specialty Distributors” such as Bimeco, and its predecessor, Bimeco, Inc., were still a “valuable part of the ICU sales team” that could use their “local relationships and clinical expertise” to help separate ICU from other competitors. (Dep. Ex. 121; Decl. Solomon ¶ 23; Curtin 30(b)(6) Dep. 35:16-23, Apr. 21, 2016.) 13. ICU relied upon its Specialty Distributors to assist with sales because the internal ICU sales team had “too much territory to cover” and needed the Specialty Distributors’ local knowledge and contacts. (Sabatino 30(b)(6) Dep. 131:14-18, Apr. 20, 2016.) 14. ICU also understood that the Specialty Distributor expected to be compensated for assistance in making Direct Sales in the form of commissions when Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 4 of 46 5 the Specialty Distributor participated in the sale. (M. Jungers Dep. 8:22-25, 9:3-10, 76:14-25, 77:1, May 10, 2016; Sabatino 30(b)(6) Dep. 77:24-25, 78:1, Apr. 20, 2016; Decl. Solomon ¶¶ 24, 26.) 15. In the case of Direct Sales, when the Specialty Distributor used its local contacts and clinical expertise to help ICU sell its products, ICU agreed to pay Bimeco a monthly commission of 15% on the sales of all products to the end user. The 15% commission on sales of ICU products was owed as long as the products were sold to the end user and the specialty distributor relationship with ICU continued. (M. Jungers Dep. 130:20-25, 131:1-15, May 10, 2016; Jacobs Dep. 85:1- 17, 177:19-25, 178:1-5, June 2, 2016; Bimeco 30(b)(6) Dep. 9:15-25, 10–13:1-8, Jan. 12, 2016; Dep. Ex. 148; Decl. Solomon ¶¶ 24, 25.) 16. Based on a “general agreement” between ICU and the Specialty Distributors, ICU recognized 15% as its’ “standard guideline” commission for Specialty Distributors which could be changed by mutual agreement between the ICU sales representative and the Specialty Distributor representative before the Specialty Distributor representatives assisted in selling the ICU product to the end user. (Bimeco 30(b)(6) 26, 27:1-8, 38:10-25, 39:1-15, 41:19-22, Jan. 12, 2016; Curtin 30(b)(6) Dep. 36:19-25, 37:1-22, 38:21-25, 39:1-16, Apr. 21, 2016; Sabatino Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 5 of 46 6 (30(b)(6) Dep. 156:16-24, 147:22-25, 148:1, Apr. 20, 2016; Jacobs Dep. supra, 178:3-8; Dep. Ex. 212 [ICU 007380 – 007382]; Decl. Solomon ¶ 24.) 17. In 2003, Mark Jorgensen, ICU’s Director of National Accounts, announced to all its specialty distributors, including Bimeco’s predecessor in interest, the Jungers, and the Bimeco Sales Reps, a deviation from the Direct Sales standard commission agreement for sales to members of GPOs called “MedAssets” (the “MedAssets Agreement”). (Dep. Ex. 77A; Decl. Solomon ¶¶ 11, 12, 24; Decl. M. Jungers ¶ 12; Curtin 30(b)(6) Dep. 28-30, Apr. 21, 2016.) 18. Mr. Jorgensen confirmed the deviation in a letter passed on to Specialty Distributors, including Bimeco, Inc., which stated “If MA [MedAsset] members choose to get the boxes from a wholesaler [the Direct Sales method], ICU will pay you [Specialty Distributor] a monthly commission. The structure will be 15% on Clave items, 10% on blunt cannula items and 8% on commodity items [product that did not include a clave connector].” (Hereinafter referred to as the “MedAssets Letter”). Id. 19. The MedAssets Letter was distributed to the ICU sales force, including ICU sales reps such as Mike Lester (Dep. Ex. 121), who were instructed to pass the letter on to the Bimeco Sales Reps. (Decl. Solomon ¶¶ 10, 11; Decl. M. Jungers ¶ 12.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 6 of 46 7 20. Under the MedAssets Agreement, while Specialty Distributors would receive the standard 15% commission on Clave Products, ICU reduced dropped the commission it agreed to pay on non-Clave commodity items to 8%. (Bimeco 30(b)(6) Dep. 26:10-25, 27:1-8, Jan. 12, 2016; M. Jungers Dep. 89:1-23; Decl. Solomon ¶ 12.) 21. Bimeco, Inc., the Jungers, and the Bimeco Sales Reps proceeded to attempt to sell ICU products to MedAsset members based upon ICU’s promise. (Decl. M. Jungers ¶ 12; Decl. Solomon ¶¶ 10, 11, 12.) 22. In July 2007, LXU Healthcare, Inc., Bimeco Inc.’s controlling company, elected to discontinue its operation in the southeast. (S. Jungers Dep. 69:19-25, 70:1-25, 71:1-11, May 9, 2016.) 23. The Jungers and the Bimeco Sales Reps formed The Bimeco Group, Inc. and assumed all the contracts and relationships with manufacturers, including ICU, under the same terms and conditions as they had operated under as a division of LXU. (Bimeco 30(b)(6) Dep. 41:11-25, Jan. 12, 2016.) 24. ICU, through its national sales manager, Paul Curtin, and Bimeco, through Mr. Jungers, agreed that Bimeco would proceed as a Specialty Distributor representative as Bimeco, Inc. had done before. (Bimeco 30(b)(6) Dep. 41:5-25, Jan. 12, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 7 of 46 8 25. The transition was seamless. Bimeco proceeded with its Specialty Distributor relationship and conducted business as usual with ICU from August of 2007 to the termination of the relationship on December 31, 2014. (Decl. Solomon ¶ 21; Bimeco 30(b)(6) Dep. 41:11-25, 41:1-6, Jan. 12, 2016.) 26. ORHS is a group of nine hospitals in Orlando, Florida, which formed a buying group for the purpose of purchasing products at a higher volume so they could get lower prices. In 2002, Ms. Jungers and Mr. Solomon, while working for Bimeco’s predecessor, introduced the first Clave Products into ORHS as part of a project to rewrite the neonatal intensive care unit (“NICU”) infection prevention protocols. Use of these protocols and the Clave Products resulted in a substantial reduction in NICU infection rates compared to the rest of the hospital. (Decl. Solomon ¶¶ 5–9; Jacobs Dep. 18:10-17, June 2, 2016; Dep. Ex. 85.) 27. In the fall of 2006, ICU hired a former registered nurse, Kristin Jacobs, to be the sole ICU in-house sales representative for the entire state of Florida. ICU later added a second, junior sales representative to assist her. Ms. Jacobs relied heavily on the Bimeco Sales Reps, including Stewart Solomon, to help her cover her sales territory. (Jacobs Dep. 85:1-7, June 2, 2016.) 28. As an example, on or about January 25, 2007, in an email to Mr. Solomon, Ms. Jacobs asked Mr. Solomon “are you able to get me into ORMC Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 8 of 46 9 [another name for ORHS] . . . they are secondary MedAssets.” (Emphasis added.) Ms. Jacobs asked Mr. Solomon to introduce her to all his contacts in all departments in ORHS because she wished to team up with Bimeco and Mr. Solomon to sell the full line of ICU infusion, chemotherapy, and dialysis products to ORHS system wide. (Jacobs Dep. 17:5-25 – 26:1-12, June 2, 2016.) 29. ORMC is ORHS’s main hospital and the two terms, “ORMC” and “ORHS,” were used interchangeably. (Jacobs Dep. 21:1-10, June 2, 2016.) 30. As requested by the MedAssets Letter, Mr. Solomon used his “local relationships and expertise” to assist Ms. Jacobs in meeting key personnel in the adult trauma units, nursing, infection control, materials acquisition, and oncology units in order to sell Infusion and Chemo Products to ORHS. (Jacobs Dep. 21–26:8, 142:22-25, 143:1, June 2, 2016; Dep. Ex. 172; Decl. Solomon ¶ 18.) 31. For the next two years, Mr. Solomon and Ms. Jacobs, undertook a team effort, along with other ICU employees, to sell the full line of ICU Clave and Chemo Products into ORHS system-wide. Mr. Solomon participated in all in services training programs, as well as all quality control trials of the Infusion and Chemo Products at ORHS. (Decl. Solomon ¶ 33; Jacobs Dep. 140:24-25, 141:1-25, 142:1- 24, 143:1, June 2, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 9 of 46 10 32. Mr. Solomon and Bimeco played an essential role in persuading ORHS to purchase the full line of ICU Clave and Chemo Products system wide by the fall of 2009. (Jacobs Dep. 144:18-25, 145:1-2, June 2, 2016, Decl. Solomon ¶ 34; Dep Ex. 81 [ICU 007349]; Decl. M. Jungers ¶ 8.) 33. Based on his full participation in ORHS project, Mr. Solomon and Bimeco expected to be paid 15% on sales of all ICU Clave and Chemo Products and at least 8% (instead of the normal 15%) on sales of non-clave commodity products. Kristin Jacobs, the ICU sales representative charged by ICU with discussing commission rates with Mr. Solomon, on behalf of Bimeco, was aware of Mr. Solomon’s and Bimeco’s expectation and shared that expectation. (Jacobs Dep. 85:1-15, June 2, 2016; Decl. Solomon ¶¶ 15, 24, 26, 56.) 34. Neither she nor any other ICU representative told to Mr. Solomon or Bimeco they would not receive the standard 15% commission or offered a different commission rate. (Dep. Exs. 84, 212, Decl. Solomon ¶ 26; Jacobs Dep. 180:13-17, June 2, 2016.) 35. Ms. Jacobs attempted to submit ICU’s internal Relationship Form providing for payment of commissions to Bimeco on Clave and Chemo Products, but got her “hand slapped” by her supervisors. (Jacobs Dep. 172:14-21, June 2, 2016; Dep. Ex. 81 [ICU 007350 – 007351].) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 10 of 46 11 36. No commissions were paid to Bimeco in 2010. (Decl. Solomon ¶¶ 56, 58.) 37. Responding to numerous complaints from Mr. Solomon, Ms. Jacobs reported to her boss, Paul Curtin, that Mr. Solomon and Bimeco were justifiably unhappy. She stated “at no time was Stewart [Solomon] or Bimeco made aware that they would not be paid for any or all of the business.” (Jacobs Dep. 177:11-15, June 2, 2016; Dep. Exs. 81, 212.) 38. Mr. Curtin admitted excluding Bimeco had been a “mistake.” He told Ms. Jacobs that he would pay Bimeco a commission on the Clave and Clave peripheral business, which included all of the Clave Products sold to ORHS. (Dep. Ex. 81 [ICU 007351]; Curtin 30(b)(6) Dep. 95:3-17, Apr. 21, 2016; Jacobs Dep. 167:21-25, 168:1-21, June 2, 2016.) 39. Mr. Curtin excluded Chemo Products even though Bimeco participated in the sale. Id. 40. According to ICU’s records, the total sales of ICU Clave Products to ORHS for 2009 through March 1, 2011 (“Proposed Payment Period”) equaled $1,390,471 from the sale of at least 24 different Clave Products. Bimeco should have received a 15% commission, or $208,570.65, for those sales in the Proposed Payment Period. (Decl. M. Jungers ¶ 5; Dep. Exs. 20 and 22.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 11 of 46 12 41. In 2010, ICU Chemo Products were withdrawn and not sold to ORHS because their connectors were incompatible with other products used by ORHS. They were reintroduced to ORHS in July 2012. (Jacobs Dep. 181:1-17, June 2, 2016; Dep. Ex. 117.) 42. Instead, Mr. Curtin selected six Clave Products with total sales of $514,700 from October 2009 through January 2011, and calculated a 15% commission of $77,205. (Dep. Ex. 82 [ICU 005650 – 005651].) 43. But ICU declined to even pay the commissions originally suggested by Mr. Curtin. After a discussion between Mr. Curtin and Rich Costello, ICU’s Vice President of Sales, ICU proposed “We will pay $30,000 dollars to Bimeco for past commissions on Clave business at ORMC. . . . We will pay 10% on clave business going forward at ORMC (clave, and clave extension sets) for the remainder of 2011.” (the “Partial Payment Offer”). (Dep. Ex. 87 [ICU 006707]; Curtin 30(b)(6) Dep. 172:21-25, 173:1-25, Apr. 21, 2016.) 44. There was no language in the email indicating that the Partial Payment Offer was a final satisfaction of ICU’s obligation to Bimeco’s commission. Id. 45. Mr. Jungers objected to the Partial Payment Offer as being inadequate and questioned the figure as being too low as an initial payment plan because he believed the sales of Clave Products should have been higher than $300,000 Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 12 of 46 13 (requiring a higher commission even at 10%). However, Mr. Curtin falsely told Mr. Jungers that the $30,000 represented 10% of total sales revenue of nine (9) Clave Products equaling $300,000 which were the only Clave Products ORHS was purchasing. Yet Mr. Curtin knew that the sales revenues from just six (6) Clave Products sold to ORHS in that period exceeded $300,000 by over 70% and that ORHS was by far purchasing more Clave Products than the nine (9) Clave Products represented to Mr. Jungers. (Decl. M. Jungers ¶ 5; M. Jungers Dep. 71:9-19, May 9, 2016; Curtin 30(b)(6) Dep. 172:21-25, 175:15-25, 176:1-14, Apr. 21, 2016; Dep. Ex. 87.) 46. In response to Mr. Jungers’ objection that the Partial Payment Offer was too low, both Mr. Curtin and Mr. Costello agreed the offer was not intended to be a full and final payment of all amounts due. (Decl. M. Jungers ¶ 12.) 47. Mr. Curtin and ICU agreed that ICU would pay additional commissions over the amount they were currently offering for both Clave and Chemo Products in the future once they were able to better assess the purchasing trends of ORHS on “a case by case basis.” (ICU 30(b)(6) Dep. 179:2-13, Apr 21, 2016, M. Jungers Dep. 87:8-25, 88:1-25, May 9, 2016; Decl. M. Jungers ¶¶ 12-14.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 13 of 46 14 48. From 2009 to 2011, ICU attempted to sell IV, Infusion and Chemotherapy Products to Children’s Healthcare of Atlanta (“CHOA”) without success. (Def’s Response to Pl’s First Requests for Admission ¶ 20.] 49. ICU placed a high priority on converting CHOA to ICU products. It was not only perceived to be a high volume client but also a high profile customer that could help ICU sell product to other children’s hospitals. (Sabatino 30(b)(6) Dep. 40:19-22, 41:20-25, 42:1-25, 43:1-25, Apr. 20, 2016; Dep. Ex. 37.) 50. As with ORHS, ICU sales representatives sought to use Bimeco’s local contacts and clinical expertise to sell CHOA Infusion and Chemo Products. (Sabatino 30(b)(6) Dep. 85:2-10, Apr. 20, 2016; Decl. S Jungers Decl. ¶ 6.) 51. Bimeco and Sandra Jungers had a long standing relationship with a number of CHOA personnel involved in the approval and purchasing of new products, including Donna Peace, the head nurse in charge of infection control. Before the summer of 2011, Donna Peace was the main opponent to the use of ICU infusion products at CHOA. (Email from David Webb, sales representative at ICU to Bruce Dragish dated February 24, 2011 [ICU 029930], attached hereto as Exhibit A.) (S. Jungers Dep. 44:1-25, May 9, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 14 of 46 15 52. Donna Peace was the Director of Infection Control for CHOA, the approval of which is integral to all accounts. (Sabatino 30(b)(6) 118:14-19, Apr. 20, 2016; Bimeco 30(b)(6) Dep. 148:24-23, 149:1-23, Jan. 12, 2016.) 53. ICU was aware of Ms. Jungers’ professional relationship with Ms. Peace. (Sabatino 30(b)(6) Dep. 101:2-23, Apr. 20, 2016.) 54. Bimeco contends and ICU disputes that ICU representative, Vincent Sabatino approached Ms. Jungers and offered to pay her 10% of all sales revenues of ICU IV, Infusion and Chemo Products sold to CHOA for as long as Bimeco maintained a Specialty Distributor Relationship with ICU, if Ms. Jungers would: (1) use her contacts and influence to persuade key decision makers at CHOA, such as Donna Peace, to consider and trial ICU Infusion and Chemo Products, and (2) refrain from attempting to sell products that potentially competed with the ICU product line. (Decl. S. Jungers ¶ 6; Sabatino 30(b)(6) Dep. 87:6-21, Apr. 20, 2016; S. Jungers Dep. 11:7-25, 12:1-25, 13:1-25, May 9, 2016.) 55. Ms. Jungers did everything ICU asked her to do in connection with the sale of ICU Infusion and Chemo Products to CHOA. (Decl. S. Jungers ¶ 11.) 56. Ms. Jungers used her influence on CHOA personnel and refrained from attempting to sell competitive products. (S. Jungers Dep. 38:1-12, May 9, 2016; Decl. S. Jungers ¶ 8.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 15 of 46 16 57. Ms. Jungers met with Donna Peace and discussed ICU Products on a number of occasions. (Decl. S. Jungers ¶ 9.) 58. Ms. Jungers provided CHOA with sample products and worked to answer questions about the products raised by CHOA. (Decl. S. Jungers ¶ 10.) 59. In addition, as requested, Ms. Jungers refrained from introducing any products which might be seen as competition. (Bimeco 30(b)(6) Dep. 151:3-25, 152:6-25, 153:1-17, Jan. 12, 2016; S. Jungers Dep. 31:24-25, 32:1-11, May 9, 2016.) 60. ICU did not notify Ms. Jungers of the trial and in service schedule for CHOA, and specifically requested that she not participate in the trials or price negotiations and Ms. Jungers complied. (Decl. S. Jungers ¶ 12.) 61. In 2013, ICU began to sell its Infusion Products to CHOA. Total product sales from January 1, 2012, to December 31, 2014, the end of Bimeco’s Specialty Distributor relationship with ICU, equaled $2,190,484. (Dep. Ex. 24, McGrody 30(b)(6) Dep. 140:9-25, 141:1-28, Mar. 22, 2016.) 62. ICU only paid Bimeco a commission of $1,294.05 for the sale of products to one of the CHOA hospitals for one month during that period. (Dep. Ex. 18, p. 156.) 63. ICU does not deny Bimeco and Ms. Jungers are entitled to commissions for their efforts in assisting ICU with the sale to CHOA. Instead, ICU sold 24 Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 16 of 46 17 separate ICU Products to CHOA during the years 2012, 2013, and 2014. (Dep. Ex. 21.) Bimeco was scheduled to (and in fact did not) receive commissions on eight (8) of the 24 ICU Products for one year. (Sabatino 30(b)(6) Dep. 186:3-25, 187:1-8, 194:10-25, 195:1-25, 196:1-25, Apr. 20, 2016.) 64. Bimeco seeks payment of the remaining $217,754.35 (10% of $2,190,484.00 ‒ $1,294.05) in commissions owed for sales of ICU infusion and chemotherapy products to CHOA from 2013 through December 31, 2014. (Dep. Exs. 18 and 21.) 65. Under the terms of the manufacturers Rep Contract between ICU and Bimeco, Bimeco engaged in sales and service of accounts for the benefit of ICU in two ways. In each case, Bimeco would help develop a customer relationship and help convince the customer to purchase ICU products at a price typically set by ICU. Then, the ICU products would be delivered to the customer in one of two procedures: (1) once the customer agreed to purchase the ICU product, it would be directly shipped to the customer anywhere in Bimeco Sales Territory by ICU and ICU would pay Bimeco a sales commission based on a percentage of the sale price (“Direct Sales Method”); or (2) Bimeco would purchase the ICU product from ICU and store it in a warehouse located in Fayette County, Georgia and then ship the ICU product to the customer based on the price and terms negotiated with the customer by ICU Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 17 of 46 18 (“Indirect Sales Method”). (Bimeco (30)(b)(6) Dep. 9:15-25, 10:1-25, 11:1-25, 12:1- 25, 13:1-8, Jan. 12, 2016.) 66. Under the Direct Sales Method, ICU would ship the ICU product to the customer and pay Bimeco a commission typically based on 15% of the sales price (the “Direct Sales Commission”). (Amended Compl. ¶ 13 [28]; Answer ¶ 13 [29]; Bimeco 30(b)(6) Dep. 9:18-25, 10:1-6, Jan. 12, 2016.) 67. Under the Indirect Sales Method, after Bimeco had developed a relationship with the customer, ICU would negotiate the price and quantity terms of the sale. The price negotiated with the customer would usually be sold at discounted prices (the “Discount Price”), for less than the retail purchase price for the product. Bimeco would purchase the ICU product from ICU at the retail sales price which was generally greater than the Discount Price charged the customer. (Bimeco 30(b)(6) Dep. 10:13-23, Jan. 12, 2016.) 68. Under the Indirect Sales Method, Bimeco was entitled to receive (1) a commission of generally 20% of the sales price (the “Indirect Sales Commissions”), and (2) the difference in the retail sales price paid by Bimeco and the Discount Price paid by the customer from ICU (the “Commission Rebates”). (Bimeco 30(b)(6) Dep. 11:2-25, Jan. 12, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 18 of 46 19 69. There was an advantage to ICU when Bimeco was the distributor because Bimeco sometimes carried more product than the wholesalers and Bimeco could help out ICU if customers ran short on product. (Curtin Dep. 141:20-24, Apr. 21, 2016.) 70. ICU Clave and MicroClave products were viewed by ICU and Bimeco as superior to other competitive products. (Curtin Dep. 16:3-22, 18:1-7, Apr. 21, 2016.) 71. Specialty Distributors would have a sales force that would assist in the sales process and be involved in the sales process as general line distributor would not. (Curtin Dep. 18:13-25, 19:1 15, Apr. 21, 2016.) 72. In the 1990s, ICU had no original equipment sales force so all product was sold through Specialty Distributors. (Curtin Dep. 19:16-24, Apr. 21, 2016.) 73. The advantage of using a specialty distributor was that it enabled ICU to manufacture and sell products without incurring the overhead of hiring a sales force. (Bimeco 30(b)(6) Dep. 45:13-25, 46:1-25, 47:1-25, Jan. 12, 2016.) 74. In the 1990s and early 2000s “the box [ICU product] was sold to the distributor and the distributor sold it to the end user.” (Curtin Dep. 22:7-11, Apr. 21, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 19 of 46 20 75. By the year 2000, the rebate system was in place under which ICU would set a sales price to an end user lower than the sales price to the Specialty Distributor (“Indirect Sales”) and ICU would rebate the difference, plus commission, to the Specialty Distributor. (Curtin Dep. 23:21-23, Apr. 21, 2016.) 76. At some point after 2000, ICU began selling product by Direct Sales through both Specialty Distributors and box movers. (Curtin Dep. 24:16-20, Apr. 21, 2016.) 77. A general line distributor which does not have a sales force or assist ICU in selling the ICU products is commonly referred to as a “box mover” by ICU and Bimeco. (Bimeco 30(b)(6) Dep. 87:6-14, Jan. 12, 2016.) 78. Paul Curtin was National Sales Manager for ICU from 2002 to the present. (Curtin 30(b)(6) Dep. 10:12-15, Apr. 21, 2016.) 79. Kristin Jacobs was a sales representative for ICU in Florida. She worked with Specialty Distributor companies, such as Bimeco. (Curtin 30(b)(6) Dep. 31:15-25, Apr. 21, 2016.) 80. Originally, before ICU had national accounts and contracted to manufacture original equipment sold by other retailers under their brand name to end users, ICU sold all of its products through Specialty Distributors, like Bimeco Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 20 of 46 21 and its predecessor in interest, Bimeco, Inc. (Curtin 30(b)(6) Dep. 22:7-21, Apr. 21, 2016.) 81. In the early 2000s, ICU began entering into contracts with group purchasing organizations or “GPOs.” (Curtin 30(b)(6) Dep. 25:11-24, Apr. 21, 2016.) 82. The Med Assets Letter announced the entry of a pricing agreement with MedAssets or MA, and described “MA” as . . . the third largest GPO in the US with over 16,000 members and 9 billion dollars in annual purchases. It is estimated that MA members purchase over 150 million dollars of IV sets per year. ICUs [sic] products constitute less that [sic] 3% of this business. We are happy to see that many distributors have seen substantial increases in business due to this agreement. We have already signed three major health systems under this new agreement as well as many alternate-site facilities. These early success stories will help us to further penetrate the enormous potential business in MA member accounts. In order to continue the momentum, we want to bring to your attention the following bullet points: We [ICU] now have a robust national accounts department to manage the mechanics of this agreement. Account targeting and communications must take place between your sales reps and our PSRs prior to meeting with and presenting to MA members. Our PSRs will work with the ICU Corporate Account personnel whose primary function is to work with MA Regional Directors. To prevent overlap, miscommunication and issues in the already protected Abbott full line accounts only the ICU Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 21 of 46 22 Corp Account Reps and Region Managers are to work with MA personnel. This contract mandates that distribution to MA members is to be bound by authorized MA distributors only. The contract further stipulates that Cardinal Health and Owens & Minor must be set-up to distribute. Several ICU Specialty distributors are already approved MA distributors. MA has an application process, Please contact me for details. [sic] You [Specialty Distributor] are a valuable part of the ICU Sales Team. We [ICU] will expect your dedication in helping these MA members to convert to our products. Your local relationships and clinical expertise will help us to separate our team from the others that are out there. If MA members chose to get the boxes from a wholesaler [box mover] ICU will pay you a monthly commission. The pay structure will be 15% on Clave items, 10% on blunt cannula items and 8% on commodity items. The sales tracings will be processed along with the Punctur-Guard items. We [ICU] look forward to making this a successful agreement for all of us! (Emphasis added.) (Amended Compl. Ex. 115 [28]; Amended Answer ¶ 115 [29]; Dep. Ex. 121; Solomon Dep. 38:11-22, May 10, 2016.) 83. Bimeco sales representatives, as employees of Bimeco’s successor in interest Bimeco, Inc., received a copy of the MedAssets Letter from ICU sales representative Mike Lester, by email dated June 25, 2003, who passed the information on to other Bimeco personnel, such as Stewart Solomon, Mack Cranford, and Mark Jungers. (Decl. Solomon ¶ 10.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 22 of 46 23 84. Mark Jungers, has no recollection of ever receiving any notice that the representations set forth in the Specialty Distributor Letter were changed or altered before Bimeco’s termination as a specialty representative on or about December 31, 2014. (Decl. M. Jungers ¶¶ 17, 18.) 85. Based on the MedAssets Letter and numerous emails and statements by ICU and a course of dealing between ICU and Bimeco, both Bimeco and Kristin Jacobs, ICU’s Florida sales representative, understood that unless ICU and Bimeco discussed, negotiated, and agreed to a different commission rate before Bimeco’s performance, Bimeco was entitled to 15% of the actual sales revenues received by ICU for all ICU Products sold to an ICU customer which Bimeco assisted in converting to ICU Products, as long as Bimeco was ICU’s specialty distributor for the southeast. (Curtin 30(b)(6) Dep. 50:20-25, 51:1-2, April 20, 2016; Jacobs Dep. 85:1-16, June 2, 2016; Decl. Solomon ¶¶ 24, 25, 26.) 86. ICU field representatives were authorized to communicate the commission to be paid to Bimeco for assisting ICU in selling ICU Products to end users. (Curtin 30(b)(6) Dep. 37:17-22, Apr. 21, 2016.) 87. ICU’s management recognizes that a Specialty Distributor had been a big part of their growth and “always wanted to find a way to work with the specialty dealers.” (Curtin 30(b)(6) Dep. 40:9-13, Apr. 21, 2016; Decl. Solomon ¶ 15.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 23 of 46 24 88. The officers and sales representatives comprising Bimeco all worked for LXU Healthcare, Inc. (“LXU”) before July 2007, when Bimeco was formed. LXU was a conglomerate of specialty distribution partners that covered the entire country. In June 2007, LXU was acquired by Integra Life Sciences which absorbed many of the specialty distributor partners. Bimeco, Inc. had been the specialty distributor partner for 20 years. On June 30, 2007, Integra Life Sciences informed Bimeco Inc. that it would not be included in the purchase. So the name was changed to The Bimeco Group, Inc. and the company proceeded as before. (S. Jungers Dep. 69-70, May 9, 2016; Decl. Solomon ¶ 21.) 89. Kristin Jacobs, R.N. MSN (“Ms. Jacobs”) was employed by ICU as a sales representative covering the territory which included portions of the state of Florida in which ORHS operated from before January 1, 2007 through January 1, 2011. (Pl’s Request for Admissions No. 4, June 9, 2016.) 90. Ms. Jacobs was considered to be competent, honest, and a good worker by ICU. (Curtin 30(b)(6) Dep. 54:17-25, 55:1-2, Apr. 20, 2016.) 91. Ms. Jacobs was authorized to act on behalf of ICU in attempting to introduce and sell ICU Products, including the product line referred to as “infusion products” and the product line referred to as “chemotherapy products” to ORHS Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 24 of 46 25 from January 1, 2007 through and including January 1, 2010. (Pl’s Request for Admissions No. 5, June 9, 2016.) 92. Ms. Jacobs, on behalf of ICU, was authorized by ICU to ask Stewart Solomon to assist her in attempting to sell both the ICU IV and ICU Chemo Products to ORHS on a system wide basis during the years 2007 to 2010. (Pl’s Request for Admissions No. 6, June 9, 2016.) 93. Ms. Jacobs used the following ICU company email address kalward@icumedical.com from January 1, 2007, until it was changed to kjacobs@icumedical.com. (Jacobs Dep. 108:3-6, June 2, 2016; Decl. Solomon ¶ 17.) 94. The Critical Care division of ICU sells products unrelated to IV infusion and chemotherapy. (Baran Dep. 10:7-15, May 24, 2016.) 95. Doug Baran deals with national accounts that include larger health systems and group purchasing organizations. (Baran Dep. 12:2-20, May 24, 2016.) 96. MedAssets is a group purchasing organization which had a pricing contract with ICU and Doug Baran assisted in overseeing this account. (Baran Dep. 15:20-23, May 24, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 25 of 46 26 97. From 2007 to 2009 ICU had two sales representatives in the state of Florida representing infusion and chemotherapy products, Kristin Jacobs and Matt Gingo. (Baran Dep. 16:7-19, 18:23-25, 19:1-3, May 24, 2016.) 98. In connection with the sale of products to ORHS, Doug Baran’s main contact was Rosaline Parsons, head of Healthcare Purchasing Alliance, LLC (“HPA”), the purchasing arm of ORHS. (Baran Dep. 19:18-25, 20:1-9, May 24, 2016.) 99. It was part of Doug Baran’s job to provide pricing to sales representatives if they wanted special pricing lower than standard GPO pricing. (Baran Dep. 21:21-25, 22:1-12, May 24, 2016.) 100. On November 7, 2007, Kristin Jacobs asked Doug Baran to provide her with pricing lower than standard MedAsset pricing for the entire line of ICU Infusion and Chemo Products so that Stewart Solomon could present the pricing to Rosaline Parsons of HPA. (Baran Dep. 22:13-25, 23:1-25, May 24, 2016; Decl. Solomon ¶¶ 33-38.) 101. In response to Ms. Jacob’s request to “wow” ORHS with some good pricing, Mr. Baran sent Ms. Jacobs a catalogue of standard MedAssets pricing to which ORHS already had access to online. (Baran Dep. 22:13-15, 23, 24:13-18, 25:1, May 24, 2016; Dep. Ex. 134.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 26 of 46 27 102. Doug Baran worked with Stewart Solomon to sell ICU products to ORHS. (Baran Dep. 31:10-25, 32:1-3, May 24, 2016.) 103. Doug Baran met with Rosaline Parsons at ORHS in December 2007. (Baran Dep. 33, 25, 36:1-4, May 24, 2016.) 104. Prior to December 2007, Mr. Baran was not aware that Rosaline Parsons had requested Stewart Solomon and Bimeo present a price list for the full line of ICU Infusion and Chemo Products. (Baran Dep. 34:14-19, May 24, 2016; Decl. Solomon ¶¶ 33-38.) 105. On or about February 5, 2008, Mr. Solomon of Bimeco requested additional pricing from Mr. Baran for the ICU CLC, Clave and MicroClave Products. (Baran Dep. 39:2-13, May 24, 2016; Decl. Solomon ¶¶ 43, 44, 45.) 106. Doug Baran told Stewart Solomon that ORMC (ORHS) had contacted Mr. Baran directly and asked him to give ORMC (ORHS) pricing so he told Mr. Solomon there was “no need for Bimeco to give the same bid, you [Bimeco] are included in the quote I will give them [ORMC] later today.” (Ex. 136, Baran Dep. 40:16-23, May 24, 2016; Decl. Solomon ¶¶ 43, 44, 45.) 107. Mr. Baran submitted a bid to ORHS for Clave Products and associated ICU Products in February 2008 that was lower than standard MedAsset pricing Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 27 of 46 28 submitted by Bimeco and Stewart Solomon. (Baran Dep. 41:11-25, 47:10-26, 48:21- 23, May 24, 2016; Decl. Solomon ¶ 47.) 108. Prior to submitting the pricing to ORHS in February 2008, Doug Baran discussed the pricing with Stewart Solomon of Bimeco. (Baran Dep. 49:11-18, May 24, 2016; Decl. Solomon ¶¶ 43, 44, 45.) 109. Mr. Baran’s job in selling ICU products to ORHS was negotiating the contract and pricing. It was not his job to set up trials or in-servicing to establish the quality, desirability, and safety of the ICU Products. (Baran Dep. 52:8-16, May 24, 2016.) 110. Mr. Baran was not conducting the sale of ICU products from the top. He was part of a team. (Baran Dep. 54:15-24, 57:22-25, 58:1-2, 103:2-6, May 24, 2016.) 111. Mr. Baran was aware that Stewart Solomon was participating in the in- service for clave products at ORHS in April 2008. (Baran Dep. 63:14-23, May 24, 2016.) 112. In order to in-service, a representative of ICU would go to the unit, gather up the nurses that would be using the products, and go through an in-service explaining how the product works. (Baran Dep. 64:16-24, May 24, 2016; Decl. Solomon ¶¶ 28, 29.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 28 of 46 29 113. Mr. Baran did in-service at Winnie Palmer for ICU for one or two days. (Baran Dep. 66:1-7, 67:22-20-24, May 24, 2016.) 114. Mr. Baran was not present when anyone else had a conversation with Stewart Solomon about compensation for his efforts in selling ICU products. (Baran Dep. 74:19-23, May 24, 2016.) 115. Pricing for ICU clave products and chemo products were bundled to achieve an overall higher cost savings to ORHS. (Baran Dep. 102:10-24, May 24, 2016.) 116. Mr. Baran assumed Stewart Solomon was entitled to commission on sales of products to NICU. Mr. Baran agreed Stewart Solomon was entitled to some commission for the sale of products to ORHS. (Baran Dep. 126:7-14, May 24, 2016.) 117. Mr. Baran proposed giving Stewart Solomon commission on commodity or generic products at 10%. (Baran Dep. 128:1-9, May 24, 2016.) 118. The sale of ICU products to ORHS was probably due to a combination of many things, pricing, products, delivery, and customer service. (Baran Dep. 129:6-11, May 24, 2016.) 119. Mr. Baran and ICU took over price negotiation with ORHS from Stewart Solomon in February 2008. (Baran Dep. 129:16-18, May 24, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 29 of 46 30 120. Mr. Baran admits that in most cases the specialty distributor received a 20% commission in the form of a rebate if the Specialty Distributor “moved the box,” and a 15% commission for the sale of ICU products if some else moved the box. (Dep. Ex. 148; Baran Dep. 131:10-25, 132:1-25, 133:1-9, May 24, 2016.) 121. Ms. Jacobs has a master’s in nursing and a master’s in Business Administration. (Jacobs Dep. 8:21-24, June 2, 2016.) 122. Ms. Jacobs has been a nurse since 1991. (Jacobs Dep. 9:12-13, June 2, 2016.) 123. Ms. Jacobs started working for ICU as a sales representative in the fall of 2006. Initially, she covered the entire state of Florida by herself. (Jacobs Dep. 14:10-18, June 2, 2016.) 124. ORHS was a secondary member of a group purchasing organization, MedAssets in February 2007. (Jacobs Dep. 22:8-25, 23:1-7, June 2, 2016; Decl. Solomon ¶¶ 17, 18.) 125. In March 2007, Kristin Jacobs was aware that Stewart Solomon was working with Rosaline Parsons concerning the sale of ICU products and Kristin Jacobs encouraged him to do so. Kristin Jacobs and Stewart Solomon were working together as a team to sell ICU products not just to the NICU but to the entire hospital Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 30 of 46 31 system. (Jacobs Dep. 43:20-25, 44:1-18, 45:11-24, 46:1-7, June 2, 2016; Decl. Solomon ¶ 19.) 126. Stewart Solomon and Kristin Jacobs were attempting to sell ICU products to ORHS system-wide. (Jacobs Dep. 45:11-24, 46:1-7, June 2, 2016; Decl. Solomon ¶ 26.) 127. Kristin Jacobs was aware Stewart Solomon was selling ICU Clave Products into ORHS NICU in 2006. (Jacobs Dep. 52:22-25, June 2, 2016; Decl. Solomon ¶¶ 11–15.) 128. Kristin Jacobs prepared a timeline of ICU sales activities in ORHS at the request of her boss, Paul Curtin, on February 18, 2011. (Jacobs Dep. 53:16-23, June 2, 2016; Dep. Ex. 86; Curtin 30(b)(6) Dep. 154:6-25, 155, 1-25, Apr. 21, 2016.) 129. According to Kristin Jacobs’ timeline, Sandra Jungers did an assessment in the PEDI and NICU departments at ORHS and wrote their IV protocols in 2003. As part of that, Stewart Solomon began selling ICU Clave Product C-1000 into the unit and the infection rate was lower than the rest of the hospital’s facilities. (Id., Jacobs Dep. 54:7-23, June 2, 2016; Decl. Solomon ¶¶ 6-9.) 130. Because the infections rates were so low in the PEDI and NICU at ORHS, interest in the clave products increased throughout the hospital system. (Jacobs Dep. 55:3-8, June 2, 2016; Decl. Solomon ¶¶ 6, 7, 8, 9, 11.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 31 of 46 32 131. In 2006 and 2007, there was a big push at ORHS to lower infection rates throughout the hospital system. (Jacobs Dep. 56:21-24, June 2, 2016.) 132. One of the big selling points of ICU Clave Products was that there was substantial evidence that it could reduce infection rates over products currently used by ORHS. (Jacobs Dep. 56:25, 57:1-6, June 2, 2016; Decl. Solomon ¶¶ 8, 9.) 133. In August 2007, Stewart Solomon and Kristin Jacobs persuaded the head of the ORHS adult trauma intensive care unit to try ICU clave products for use in the adult intensive care unit. (Jacobs Dep. 62-63, June 2, 2016; Decl. Solomon ¶ 27.) 134. In connection with the sale of ICU Products, hospitals and hospital units usually set up meetings with ICU so the ICU representatives, including Specialty Distributor representatives such as Stewart Solomon, could demonstrate how the ICU Products work. “In-service” involves a long and arduous process which requires the sales representative to spend long hours in the units so the representatives can educate the practitioners on what the product can do and the correct protocols for their use. This process is time consuming because patient care and physician demands are their primary responsibilities and priority; the representatives can only educate the practitioners when there is a break in their primary responsibilities and must conform to the schedule of both day and night shifts. (Decl. Solomon ¶ 28.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 32 of 46 33 135. Once trial in-service has been completed and the practitioners understand how to use the product, the hospital or hospital unit would then begin the “trial” in which the product currently used by the hospital or hospital unit would be removed and replaced with the ICU Product. A trial is also a long and arduous process that could last for months. The sales representative must make rounds often to re-stock each unit and hospital with product, ensure the product is being used properly during the trial, answer questions, resolve issues and complaints, and promote the advantages of the product to the practitioners to encourage them to give the product high marks in their evaluations which are reviewed by the hospital when it is being considered for purchase. It was essential that the ICU Products demonstrate superior performance in the trials if the hospital was going to decide to purchase the product. It is very difficult to convince a hospital to buy a product which demonstrates poor performance in the trials. (Decl. Solomon ¶ 29.) 136. Once the product is approved for use by the hospital, the sales representative generally still must return to the purchasing hospital to train and follow-up to make sure that practitioners system wide know how to use the product. Again, this typically is a time consuming process that can take days to complete. (Jacobs Dep. 60-61, June 2, 2016; Decl. Solomon ¶ 30.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 33 of 46 34 137. Stewart Solomon and Kristin Jacobs handled the trial in the adult trauma intensive care unit of ORHS in August and September 2007 by themselves. (Jacobs Dep. 63:20-22, June 2, 2016; Decl. Solomon ¶¶ 28, 29.) 138. The trial in the adult trauma intensive care unit was successful and showed reduced infection rates. (Jacobs Dep. 64:1-3, June 2, 2016; Decl. Solomon ¶ 31.) 139. Stewart Solomon assisted Kristin Jacobs in selling ICU Chemo Products to ORHS/MD Anderson. (Jacobs Dep. 76:8-14, June 2, 2016; Decl. Solomon ¶ 31.) 140. Beth Rowles is a nurse who worked on the ORHS clinical research team who reviewed products for quality and was a key decision maker. (Jacobs Dep. 78- 79, June 2, 2016; Decl. Solomon ¶ 24.) 141. Kristin Jacobs understood that the Bimeco Specialty Distributor representatives expected to be paid 15% commission on all sales of ICU products in which they were involved. (Jacobs Dep. 85:1-17, June 2, 2016; Decl. Solomon ¶ 24.) 142. In November 2007, Rosaline Parsons asked Stewart Solomon, on behalf of Bimeco, to submit pricing for the whole line of ICU Products in connection with a system wide conversion. (Jacobs Dep. 87-90, June 2, 2016; Decl. Solomon ¶ 26.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 34 of 46 35 143. Stewart Solomon and Kristin Jacobs made a joint effort to sell ICU chemotherapy products to the ORHS oncology department. (Jacobs Dep. 26:6-25, 127:1-7, June 2, 2016; Decl. Solomon ¶ 32.) 144. Stewart Solomon and Bimeco assisted Kristin Jacobs and ICU in every trial of the ICU Products at ORHS, including oncology where he assisted with in- servicing on the floor because there was not enough room in the pharmacy room itself for all participants. (Jacobs Dep. 141:1-25, 142:1-21, June 2, 2016; Decl. Solomon ¶ 31.) 145. Stewart Solomon never refused to participate in an in-service or trial at ORHS from 2007 to the end of 2009. (Jacobs Dep. 142:22-25, 143:1, June 2, 2016; Decl. Solomon ¶ 31.) 146. As a result of the efforts of Kristin Jacobs and Stewart Solomon and many others, ORHS decided that ICU MicroClave Products is what it wanted to use in the hospital. (Jacobs Dep. 52:3-21, 24-25, June 2, 2016; Decl. Solomon ¶ 26.) 147. ICU announced that ORHS had decided to purchase ICU Chemo Products in May 2009. (Ex. 85, Jacobs Dep. 153:24-25, 154:1-25, June 2, 2016.) 148. By the spring of 2009, both the ICU Clave and Chemo Product lines had been approved for use by ORHS but actual sales were delayed while ORHS Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 35 of 46 36 completed its own warehouse facility. (Jacobs Dep. 55:20-25, 150:1-9, June 2, 2016.) 149. In November 2010, Paul Curtin told Kristin Jacobs that failing to put Bimeco and Stewart Solomon on the relationship form was a “mistake” and that Mr. Curtin intended to pay Bimeco on the clave central and peripheral business which included the whole line of ICU clave-related products. (Dep. Exs. 211, 81 [ICU 007351], Jacobs Dep. 163:4-25 – 167:1-20, June 2, 2016.) 150. Traditional Specialty Distributors received commissions on all products sold into the hospital. There was no distinction on the type of product but ICU changed the tradition for ORHS. (Jacobs Dep. 169:11-13, 17:22-25, 170:1-12, June 2, 2016; Decl. Solomon ¶ 12.) 151. When Kristin Jacobs tried to fill out a relationship form including Bimeco for commissions on sales of ICU products, ICU corporate representative Bryan Gendron stopped her. (Jacobs Dep. 170:19-25 – 173:1-5, June 2, 2016.) 152. At no time was Stewart Solomon or Bimeco made aware that they would not be paid for any or all of the business for ORHS. (Dep. Exs. 81, 212; Jacobs Dep. 177:11-15, June 2, 2016; Decl. Solomon ¶ 26.) 153. Kristin Jacobs was aware that Stewart Solomon and Bimeco believed they would receive 15% commissions for their efforts in connection with the sale of Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 36 of 46 37 ICU Products to ORHS system-wide. (Jacobs Dep. 177:19-25, June 2, 2016; Decl. Solomon ¶ 26.) 154. Stewart Solomon and Bimeco were instrumental in getting the ICU Products into ORHS. (Jacobs Dep. 178:18-23, June 2, 2016; Decl. Solomon ¶ 31.) 155. In the case of ORHS, a decision was “made unilaterally” by ICU not to pay someone who helped to get a footprint in the hospital [ORHS]. (Jacobs Dep. 179:14-20, June 2, 2016; Dep. Exs. 81, 212.) 156. C-1000 is the standard, original clave product sold by ICU. (Curtin Dep. 54:6-8, Apr. 21, 2016.) 157. Rob Houde is the head of ICU, Oncology Division. (Curtin 30(b)(6) Dep. 61:20-25, 52:1-3, Apr. 21, 2016.) 158. Andrea Ledford was an important person to persuade to like ICU chemotherapy products because she was head of the Pharmacy Department at ORHS member, MD Anderson. (Curtin 30(b)(6) Dep. 62:14-15, 63:1-5, Apr. 21, 2016.) 159. ICU corporate personnel did not want to include Bimeco and Stewart Solomon in dealing with ORHS after the system-wide sale of ICU Products had been made. (Curtin 30(b)(6) Dep. 63:1-4, Apr. 21, 2016; Dep. Ex. 82 [ICU 005648].) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 37 of 46 38 160. Kristin Jacobs, Rob Houde, Mike Lester, and other ICU oncology personnel were involved in the sale of ICU Chemo Products to ORHS. Curtin 30(b)(6) Dep. 63:21-25, 64:1-4, Apr. 21, 2016; Dep. Ex. 85.) 161. Kristin Jacobs was one of the key people in the sale of Chemo products to ORHS. (Dep. Ex. 85; Jacobs Dep. 155:1-11, June 2, 2016.) 162. None of the corporate sales people at ICU disclosed to Paul Curtin that Stewart Solomon of Bimeco was also involved in the sale of Chemo Products to ORHS. (Curtin Dep. 68:21-25, Apr. 21, 2016.) 163. In November 2007, Stewart Solomon was authorized to submit prices for the full line of ICU Products, both Chemo and Infusion, to ORHS. (Curtin 30(b)(6) Dep. 75, 76, Apr. 21, 2016.) 164. Paul Curtin never discussed whether Stewart Solomon and Bimeco had an expectation of receiving commission for the sale of all products marketed and sold to ORHS at the time. (Curtin 30(b)(6) Dep.85:15-19, Apr. 21, 2016.) 165. On November 22, 2010, Kristin Jacobs sent an email to Paul Curtin notifying him that Stewart Solomon was upset because he was not being paid and would only get paid on certain items ICU sold to ORHS. (Dep. Ex. 71 [ICU 007352], Dep. Ex. 212, Jacobs Dep. 163–165, June 2, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 38 of 46 39 166. Paul Curtin admitted that Stewart Solomon was instrumental in getting the ICU MicroClave product into the hospital. (Dep. Ex. 81 [ICU 007349-007350].) 167. ICU was supposed to discuss how much commission Bimeco would receive on specific products before Bimeco did work. (Curtin 30(b)(6) Dep. 108:3- 10, Apr. 21, 2016.) 168. ICU picked six Clave Products to pay back commission on from September 2009 through March 2011. (Curtin 30(b)(6) Dep. 105:20-25, 106:1-10, Apr. 21, 2016; Dep. Ex. 82 [ICU 005654].) 169. Mr. Curtin originally applied a commission rate of 15% in accordance with the guidelines for a total back commission of $514,700 for a commission of $77,205. (Curtin 30(b)(6) Dep. 109:12-17, Apr. 21, 2016; Dep. Ex. 82 [ICU 005650].) 170. Because of objections from representatives of the National Corporate Sales Department and Vice President of Sales, Rich Costello, ICU reduced the proposed partial payment offer to Bimeco from 15% of $514,700 to 6% of $483,181 or $30,000. (Curtin 30(b)(6) Dep. 113:2-5, 114:1-16, Apr. 21, 2016; Dep. Ex. 82 [ICU 005649 – 005650].) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 39 of 46 40 171. Bimeco performed services related to the sale of ICU Products to ORHS with the understanding that it would receive certain compensation for the work they performed. (Curtin 30(b)(6) Dep. 123:15-19, Apr. 21, 2016.) 172. Paul Curtin never asked the ICU Chemo Products sales team if Stewart Solomon was involved in selling or trialing ICU Chemo Products. (Curtin 30(b)(6) Dep. 161:1-25, 163:1, Apr. 21, 2016.) 173. No one told Mr. Curtin that Mr. Solomon was not involved in Chemo trials. (Curtin 30(b)(6) Dep. 162:13-22, Apr. 21, 2016.) 174. ORHS system wide conversion to ICU Clave, MicroClave, and Chemo Products occurred between August 2009 and November 2009. (Curtin 30(b)(6) Dep. 163:2-16, Apr. 21, 2016.) 175. In January 2010, ORHS and ICU discovered that the Chemo Products were incompatible with other products which resulted in leakage of highly dangerous, toxic chemicals used in chemotherapy. (Curtin 30(b)(6) Dep. 163-165, Apr. 21, 2016; Jacobs Dep. 189:1-11, June 2, 2016.) 176. From January 2010 through July 2012, ICU not only could not sell ICU Chemo Products to ORHS, but ICU had to take back products already sold to ORHS. (Curtin 30(b)(6) Dep. 165:17-25, 167:1-14, Apr. 21, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 40 of 46 41 177. In an email dated April 1, 2011, ICU, through Paul Curtin, stated, “We will pay $30,000 dollars to Bimeco for past commissions on Clave business at ORHS. That payment will be amortized during 2011 on a monthly basis. We will pay 10% on clave business going forward at ORMC (clave, and clave extension sets) for the remainder of 2011. I will forward the relationship form memorializing that 10% payout for your records.” ICU stated to Bimeco representative Mark Jungers the calculations were based on the sale of nine (9) Clave Products to ORHS. (Curtin 30(b)(6) Dep. 174:8-17, Apr. 21, 2016; Dep. Ex. 87.) 178. ICU did not disclose to Bimeco the amount of total sales of ICU Chemo and Infusion Products between September 2009 and March 2011. (Curtin 30(b)(6) Dep. 174:6-10, Apr. 21, 2016; M. Jungers Decl. ¶¶ 9, 10.) 179. ICU sold a number of additional Infusion and Chemo Products to ORHS from September 2009 through March 2011 but did not disclose the identity of the other Clave Products or the sales volumes of those products to Bimeco until after this lawsuit was filed. (Curtin 30(b)(6) Dep. 176:3-14, Apr. 21, 2016; Decl. M. Jungers ¶¶ 9-13.) 180. ICU did not pay commissions to Bimeco on all Clave business going forward. Instead, ICU paid 10% commission on nine (9) ICU products. (Curtin 30(b)(6) Dep. 177:2-18, Apr. 21, 2016; Decl. M. Jungers ¶¶ 9-13.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 41 of 46 42 181. ICU did not disclose to Bimeco that ICU was selling other Clave Products to ORHS for which was not paying Bimeco commissions. (Curtin 30(b)(6) Dep. 177:2-18, Apr. 21, 2016; Decl. M. Jungers ¶¶ 9-13.) 182. ICU represented to Bimeco that the actual sales of ICU products was much lower than it had been projected to be and that Bimeco would be receiving commission on all the Clave Products sold to ORHS. (Decl. M. Jungers ¶¶ 9-13.) 183. ICU agreed to pay additional ORHS commissions in the future depending on what sales occurred in ORHS and agreed to assess the actual amount of these additional payments on a case by case basis. (Curtin 30(b)(6) Dep. 179:2- 15, Apr. 21, 2016; Decl. M. Jungers ¶¶ 11-12.) 184. Ms. Jungers stated that ICU would not have been in CHOA without her. (Curtin Dep. 11:11-16, Apr. 21, 2016.) 185. After the relationship form for CHOA was filled out, it is reviewed by ICU’s National Accounts. (Curtin Dep. 14:12-16, Apr. 21, 2016.) 186. Bimeco had been an active participant in sales of products to CHOA other than ICU Products for a number of years. (S. Jungers Dep. 11:7-16, May 9, 2016.) 187. Bimeco and Ms. Jungers attempted to introduce ICU Clave Products to CHOA as far back as 2009, but CHOA would not consider using a valve product Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 42 of 46 43 (which it considered ICU Clave Products to be) so Bimeco and Ms. Jungers backed off attempting to sell the product. (S. Jungers Dep. 11:16-25, 29:16-25, May 9, 2016.) 188. Sandra Jungers and Bimeco were promised a 10% commission on all sales of ICU Infusion and Chemo Products to CHOA for as long as Bimeco was ICU’s Specialty Distributor representative to assist them in front of decision makers. Vincent Sabatino promised 10% on Chemo and Infusion Products sold to CHOA. (S. Jungers Dep. 6:15-22, May 9, 2016.) 189. David Webb confirmed to Sandra Jungers that ICU would pay Bimeco a 10% commission on Chemo and Infusion Products sold to CHOA. (S. Jungers Dep. 26:23-25, 27:1-17, May 9, 2016.) 190. In August of 2013, ICU credited Bimeco with a total commission of $1,294.05 for sales of ICU Products to CHOA at Scottish Rite. See Exhibit B, attached hereto [Dep. Ex. 18, p. 156]. 191. In 2011, Ms. Jungers called on CHOA and mentioned ICU products in every meeting. CHCA had become more receptive to valve technology and it was either on a CHCA contract or being considered for inclusion in a CHOA contract which made the product more palatable for CHOA to consider buying it. (S. Jungers Dep. 31:2-14, May 9, 2016.) Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 43 of 46 44 192. In 2012, Ms. Jungers continued to promote ICU Products to her contacts, but did not participate in the trials or education of CHOA personnel on the use of ICU Products because ICU personnel requested that she not participate. Ms. Jungers was told ICU wanted the sales to go through ICU distribution channels and not through Bimeco and ICU did not want to “muddy the water” by having a Bimeco representative present at the trial. (S. Jungers Dep. 37-38, 40:21-25, May 9, 2016.) Dated: July 11, 2016 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 44 of 46 45 CERTIFICATE OF SERVICE I hereby certify that on July 11, 2016, I electronically filed with the Clerk of Court using the CM/ECF system which will automatically send e-mail notification of such filing to the following attorney(s) of record: Charles C. Murphy, Jr. cmurphy@vaughanandmurphy.com Ellen G. Schlossberg eschloss@vaughanandmurphy.com Vaughan & Muprhy 260 Peachtree Street, N.W., Suite 1600 Atlanta, GA 30303-1237 Henry D. Fellows, Jr. hfellows@fellab.com Christina Baugh cbaugh@fellab.com Fellows LaBriola LLP Suite 2300 South Tower 225 Peachtree Street, N.E. Atlanta, GA 30303 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 45 of 46 46 LOCAL RULE 5.1 CERTIFICATION I, JOHN C. PORTER, JR., certify that the foregoing has been prepared in Times New Roman 14 font and is in compliance with United States District Court, Northern District of Georgia Local Rule 5.1. s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 Case 3:15-cv-00123-TCB Document 94-2 Filed 07/11/16 Page 46 of 46 EXHIBIT A TO PLAINTIFF’S STATEMENT OF MATERIAL FACTS NOT IN DISPUTE Case 3:15-cv-00123-TCB Document 94-3 Filed 07/11/16 Page 1 of 2 EXHIBIT B TO PLAINTIFF’S STATEMENT OF MATERIAL FACTS NOT IN DISPUTE Case 3:15-cv-00123-TCB Document 94-3 Filed 07/11/16 Page 2 of 2 1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA NEWNAN DIVISION THE BIMECO GROUP, INC., Plaintiff, v. ICU MEDICAL, INC., Defendant. Civil Action File No. 3:15-cv-00123-TCB DECLARATION OF SANDRA JUNGERS I, Sandra Jungers, declare as follows: 1. I have been President and majority shareholder of The Bimeco Group, Inc. (“Bimeco”) since July 1, 2007. I am over the age of 18 years and am competent to testify. I have been authorized to make this Declaration on behalf of Bimeco. 2. The information contained in this Declaration is based on my personal knowledge of information made available to me in my official capacity as President and majority shareholder of Bimeco. 3. I am a registered nurse with over 40 years of experience in nursing and nursing protocols. 4. In late 2010 or early 2011, Vinnie Sabatino and David Webb, ICU Medical, Inc.’s (“ICU”) Sales Representatives both indicated to me that ICU was Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 1 of 7 2 attempting to sell ICU Clave and Chemo Products to Children’s Healthcare of Atlanta (“CHOA”). 5. I told them I had some good contacts who were very important in the decision making process for purchasing products especially related to infection control. 6. Mr. Sabatino and Mr. Webb asked me for help persuading CHOA decision makers to consider purchasing the ICU Clave and Chemo Products and stated to me that ICU would pay Bimeco 10% on the sales revenue generated by sales of ICU IV Infusion and Chemo Products sold to CHOA for as long as Bimeco remained a Specialty Distributor for ICU in the Southeast if I would do two things: a. meet and talk with my contacts at CHOA to convince them that the ICU Clave Products, including MicroClave based products and Chemo Products, were worth considering for trials; and b. to refrain from attempting to sell competitive products to CHOA, which might confuse or distract the decision makers from focusing on ICU Products. Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 2 of 7 3 7. ICU’s local sales representative, David Webb, confirmed ICU’s promise to pay a 10% commission as described by Mr. Sabatino in my office in Peachtree City, Georgia, sometime in the spring of 2011. 8. In reliance on that promise, I had numerous meetings and discussions with CHOA personnel, including Donna Peace, who was the Director of Infection Control at CHOA, in which I encouraged her to test the ICU Products and to reconsider her own bias against using what she called “valve” technology on children. 9. Bimeco and I also refrained from pursuing the sale of competitor products to CHOA and gave up the opportunity of receiving commissions on sales of those products. 10. I worked with David Webb to provide feedback to Donna Peace, questions concerning products, and to provide samples and related services through March 2012. 11. It is my recollection that I performed every service I was asked to perform by Mr. Webb and Mr. Sabatino. 12. I was never asked to participate in the trials or in-service by Mr. Webb or Mr. Sabatino. Had I been asked to participate, I would have done so. Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 3 of 7 4 13. It was my understanding that the trials were a success and CHOA purchased a large quantity of ICU Products. 14. I expected that Bimeco would receive commission for the sales but, as of January 12, 2016, when I testified on behalf of Bimeco, I had no personal knowledge that Bimeco had received any commission for sale of ICU Products to CHOA. 15. Since 2013, I have spoken with numerous representatives of ICU, including David Webb, Vinnie Sabatino, Paul Curtin, and Dr. George Lopez (original founder of ICU), among others. I have discussed more than once with each of them that Bimeco had not been paid commissions due for Bimeco’s assistance in selling ICU Products to CHOA. Each of them has stated to me that Bimeco was entitled to and would receive commissions. 16. None of these individuals denied Bimeco was entitled to receive commission of 10% of the total sales of ICU IV Infusion and Chemo Products sold to CHOA up to the date Bimeco was no longer a Specialty Distributor for ICU. Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 4 of 7 I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and coiTect. Executed this 9 th day of July, 2016 at Beech Mountain [CITY], North Carolina [STATE]. RA JUNGERS Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 5 of 7 CERTIFICATE OF SERVICE I hereby certify that on this 11th day of July, 2016, I served the foregoing with the Clerk of Court using the CM/ECF system which will automatically send e-mail notification of such filing to the following attorney(s) of record: Charles C. Murphy, Jr. cmurphy@vaughanandmurphy.com Ellen G. Schlossberg eschloss@vaughanandmurphy.com Vaughan & Muprhy 260 Peachtree Street, N.W., Suite 1600 Atlanta, GA 30303-1237 Henry D. Fellows, Jr. hfellows@fellab.com Christina Baugh cbaugh@fellab.com Fellows LaBriola LLP Suite 2300 South Tower 225 Peachtree Street, N.E. Atlanta, GA 30303 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 1 Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 6 of 7 LOCAL RULE 5.1 CERTIFICATION I, JOHN C. PORTER, JR., certify that the foregoing has been prepared in Times New Roman 14 font and is in compliance with United States District Court, Northern District of Georgia Local Rule 5.1. s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 2 Case 3:15-cv-00123-TCB Document 94-4 Filed 07/11/16 Page 7 of 7 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA NEWNAN DIVISION THE BIMECO GROUP, INC., Plaintiff, V. ICU MEDICAL, INC., Defendant. Civil Action File No. 3:15-cv-00123-TCB DECLARATION OF MARK JUNGERS I, Mark Jungers, declare as follows: 1. I have been Executive Vice President of The Bimeco Group, Inc. ("Bimeco") since July 2007. I am over the age of 18 years and am competent to testify. I have been authorized to make this Declaration on behalf ofBimeco. 2. The information contained in this Declaration is based on my personal knowledge of information made available to me in my official capacity as Executive Vice President. 3. I have reviewed Deposition Exhibits 20 and 22 which are Excel spreadsheets itemizing the sales of all ICU Clave Products by product number, and Deposition Exhibit 21, which is a summary spreadsheet itemizing sales of Chemo Products, by product number, to ORHS for the years beginning in 2009 and ending December 31, 2014. These spreadsheets were produced by ICU Medical, Inc. 1 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 1 of 9 ("ICU") in response to Bimeco's discovery requests (the "ORHS Sales Spreadsheets") and were identified in the deposition of Kevin McGrody, Controller of ICU, taken March 22, 2016. 4. The sales revenues shown on the ORHS Sales Spreadsheets are broken down by product number. Based on my experience of working with ICU Products for over twenty years, I was able to identify those products classified as "Clave" Products because they are given a consistent and unique type of product number, distinguishable from product numbers used on other types of products. 5. Based on the information contained in the ORHS Sales Spreadsheets, I was able to identify the local number of Clave based products sold by ICU to ORHS from September 2009 through February 28, 2011 (the "Partial Payment Period"), and the total revenues generated by those sales as reported by the ORHS Sales Spreadsheet. As a result, based on Deposition Exhibits 20 and 22, I have identified at least 24 different Clave based Products sold to ORHS between September 2009 and February 28, 2011, with total sales revenue of $1,390,471. Based on the information on the ORHS Sales Spreadsheets, attached hereto as Exhibit A is a list of ICU product numbers I identified as Clave Products sold through this time period. Based on my review of Dep. Exhibits 20 and 22, since March 2011 ICU has continued to sell many more Clave and Clave peripheral 2 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 2 of 9 Products than the nine (9) Clave Products on which ICU has paid Bimeco a 10% comm1ss10n. 6. In addition, from the same period I calculated sales revenues through the Partial Payment Period for non-Clave commodity products based upon their product numbers equaling at least a total of $316,703 for which Bimeco was promised 8% commission, for a total of $25,336.24. The revenues from non-Clave commodity products equaled about 18% of the revenue generated by the sale of Clave Products to ORHS during the Partial Payment Period. 7. In April 2011, Mr. Curtin made a proposal to me on behalf ofBimeco to begin partial payment of the commissions due for ORHS in the following amounts: "We will pay $30,000 dollars to Bimeco for past commissions on Clave business at ORHS. That payment will be amortized during 2011 on a monthly basis. We will pay 10% on clave business going forward at ORMC ( clave, and clave extension sets) for the remainder of 2011. I will forward the relationship form memorializing that 10% payout for your records." (the "Partial Payment Offer") (Dep. Ex. 87.) I viewed the Partial Payment Offer as a proposal to begin partial payments of the total amount of commissions owed to Bimeco for the sale of ICU Products to ORHS. No one at ICU ever stated or implied that by accepting 3 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 3 of 9 payments under the Partial Payment Offer Bimeco was waiving, releasing, or satisfying its claims for the remaining commissions due to Bimeco. 8. In response to the Partial Payment Offer, I insisted on a personal meeting with Mr. Curtin, National Sales Director of ICU, and Rich Costello, Vice President of Sales. We met on May 17, 2011, near Atlanta, Georgia. At that meeting, Mr. Curtin and Mr. Costello acknowledged and agreed that Bimeco and Stewart Solomon were instrumental in selling ICU Products system-wide to ORHS and that Bimeco was entitled to commissions for the sale of those products. Mr. Curtin represented that because of initial low pricing and other internal issues at ICU, ICU was offering to temporarily pay 10% of the sales revenues ICU received from the sale of all Clave and Clave peripheral Products to ORHS. 9. In more than one conversation with Paul Curtin, and including a conversation when Rich Costello was present, Mr. Curtin and Mr. Costello told me that ICU would pay Bimeco a 10% commission on all past sales of Clave Products to ORHS, which equaled $30,000, and a 10% commission on all Clave Products sold to ORHS from March 2011 to the end of 2011. . Based on the monthly commission reports Bimeco received from ICU, Bimeco was led to believe ORHS was only purchasing nine (9) Clave Products during this period. At the end of 2011, ORHS sales would be reviewed and, based on this review, additional 4 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 4 of 9 commissions would be paid. ICU did not reveal its actual sales information to Bimeco until after Bimeco filed this lawsuit. 10. Based on my review of the sales data described above, Mr. Curtin's and Mr. Costello's representations were false. ICU was not paying Bimeco 10% on the sales revenues generated from the Clave business as had been represented. Until Bimeco filed its lawsuit and engaged in discovery, I had no way of making an independent verification of how many Clave Products were sold to ORHS. As a result, I had no way to discover or dispute their false representations. 11. Paul Curtin told me that the $30,000 proposed payment represented 10% of the total sales of Clave Products to ORHS ( or $300,000) from 2009 through February 2011. Based on my review of Exhibits 20 and 22, this was a false statement. 12. At the meeting on May 17, 2011, even though I had no hard data to refute ICU's claims, I indicated to them that the Partial Payment Offer was unacceptably low. It was my belief that even if sales of ICU Products had started off as poorly as Mr. Curtin represented, they should improve dramatically and Bimeco would be entitled to substantially large commissions. In response, both Mr. Curtin and Mr. Costello indicated that the Partial Payment Offer was merely the amount ICU could pay now, before it undertook a more thorough review of 5 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 5 of 9 ORHS's trends in purchasing ICU Products and reporting those purchases. They also needed to determine whether or not ORHS would allow Chemo Products to be re-introduced into the hospital. Mr. Costello and Mr. Curtain agreed that acceptance of the Partial Payment Offer was not conditioned on a satisfaction of Bimeco's claim for ORHS commissions. Mr. Curtin and Mr. Costello both agreed that ICU would pay additional but unliquidated amounts to Bimeco for future sales of ICU Products to ORHS, including Chemo Products if ORHS agreed to purchase them in the future, after the end of 2011 based on the sales performance of ORHS. ICU did not state a specific commission rate that would be applied to future payments. These issues were unresolved and deferred for future discussion. At no time did either Mr. Curtin or Mr. Costello state or imply that the Partial Payment Offer was a full and final payment ofBimeco's claim for total commissions due to Bimeco for sales of ICU Products to ORHS, or that acceptance of the payment was conditioned upon satisfaction of Bimeco's claim at that time. I always expected to receive additional payments for ORHS commissions, including Chemo Products if ORHS agreed to purchase them in the future, when Mr. Costello and Mr. Curtain had a better assessment of ORHS sales. At the May 17, 2011 meeting we agreed to defer any confrontation between Bimeco and ICU on ORHS commissions to a future date. 6 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 6 of 9 13. If I had understood the Partial Payment Offer was conditioned upon or intended to be a final satisfaction, Bimeco would have refused to accept the payments under the Partial Payment Offer. 14. I made it clear and Mr. Curtin and Mr. Costello indicated they understood that acceptance of the payments proposed under the Partial Payment Offer was not conditioned upon waiving Bimeco's claim to receive more comm1ss10n on both Infusion and Chemo Products, and Bimeco expected to receive additional payments for commissions due on ORHS sales in addition to the Partial Payment Offer. Bimeco never agreed, stated, or implied that by accepting the Partial Payment Offer Bimeco was releasing, satisfying, or discharging its claim for the total commission due for the sales of ICU Products to ORHS. In accepting payments under the Partial Payment Offer Bimeco was merely deferring the decision of whether to file a lawsuit against ICU to see if ICU would eventually pay all its obligation without litigation or enough of its obligation that pursing litigation would not be worthwhile. 15. When I and Bimeco President Sandra Jungers used the term "settlement" in connection with the Partial Payment Offer, we were referring to the fact that ICU had fmally agreed to start payment of a portion of what was due. We did not intend to imply that Bimeco's claims had been released or satisfied. 7 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 7 of 9 16. In and around 2003, ICU announced to all Specialty Distributors that it had entered into a national pricing contract with a Group Purchasing Organization ("GPO") called MedAssets (the "MedAssets Letter"). As Vice President of Bimeco's predecessor corporation (Bimeco, Inc.) I received a copy of the announcement. A true and accurate copy of the announcement is attached to the Amended Complaint as Exhibit C and is Deposition Exhibit 122. I and the Bimeco Sales Reps relied upon the representations concerning payment of commissions set forth in that letter to attempt to sell ICU Products to MedAsset member hospitals, such as Orlando Regional Healthcare System ("ORHS"). 17. To the best of my recollection, before 2011 no ICU representative ever stated or implied that the MedAssets Letter was no longer in effect. 18. From 2007 through 2011, I was not aware of any agreement between ICU and Bimeco that the 15% Direct Sales commission expired before the termination of Bimeco as an ICU Specialty Distributor. To the extent that any ICU pricing contract expired, it was always renewed and Bimeco continued to receive commissions as long as the customer continued to purchase the product and Bimeco remained ICU's Specialty Distributor. 8 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 8 of 9 I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed this __ day of July, 2016 at __________ [CITY], -------- [STATE]. JUNGERS 9 Case 3:15-cv-00123-TCB Document 94-5 Filed 07/11/16 Page 9 of 9 1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA NEWNAN DIVISION THE BIMECO GROUP, INC., Plaintiff, v. ICU MEDICAL, INC., Defendant. Civil Action File No. 3:15-cv-00123-TCB DECLARATION OF STEWART SOLOMON I, Stewart Solomon, declare as follows: 1. I am an Account Representative for The Bimeco Group, Inc. (“Bimeco”). I am over the age of 18 years and am competent to testify. I have been authorized to make this Declaration on behalf of Bimeco. 2. The information contained in this Declaration is based on my personal knowledge of information made available to me in my official capacity as an Account Representative for Bimeco. 3. Attached hereto are Exhibits A – O. I will identify and authenticate each of these emails separately. Each of these emails were stored in my computer database over which I have, at all times, preserved and maintained in their original content of each email in my custody and control. Each email involves business Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 1 of 27 2 activities in which I was engaged as an Account Representative and were stored contemporaneously when I sent or received them in the normal course of business. 4. From September 15, 1992 to July 1, 2007, I worked as a Specialty Distributor Sales Representative for Bimeco, Inc., a subsidiary of LXU Healthcare, Inc., and its successor, for which I sold medical equipment to various hospitals house-wide and other medical institutions on behalf of independent manufacturers. 5. Included in the products I sold were Clave Products manufactured by ICU Medical, Inc. (“ICU”), Defendant in this action. ICU Clave Products include products which incorporate a proprietary needleless connectors called a “Clave” and a later version called a “MicroClave.” 6. In and around early 2001, Sandra Jungers, a registered nurse and Specialty Distributor Representative for Bimeco, and I worked with Teresa McCommon, of the Materials Management Department and Janet Moore of the the neonatal intensive care unit (“NICU”) of Orlando Regional Healthcare System (“ORHS”) to review, develop, and adopt new infection reduction protocols (the “NICU Protocols”) for the use of intravenous systems in the NICU of ORHS. 7. As part of the NICU Protocols which were written and designed by Ms. Jungers, I introduced and sold to ORHS a set of products which included an Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 2 of 27 3 ICU Clave Product referred to as “C-1000” which, to my knowledge, was the first ICU Clave Product sold to ORHS. 8. As a result of the implementation of the NICU Protocols in conjunction with the ICU Clave Products, infection rates and wastage of drugs were substantially reduced in the NICU at ORHS. Safety and efficiency in medication delivery were optimized. 9. I had extensive and regular contact with ORHS personnel in various units at ORHS. Kristin Jacobs and I were told that the infection rates were substantially lower in the NICU after implementation of the NICU Protocols and the use of the C-1000 Clave Product than in other units in the hospital, and this fact was widely known by the Infection Control Department and others charged with tracking and reducing infection rates within the hospitals. 10. Attached to Bimeco’s First Amended Complaint as Exhibit C (and as Dep. Ex. 77A and Dep. Ex. 121) is a true and accurate copy of an email letter from Mark Jorgensen, ICU’s National Account Sales Director, addressed to “Specialty Distributors,” including my company, Bimeco, Inc., which was passed around to Bimeco, Inc.’s Specialty Distributor Representatives, encouraging our efforts to sell ICU Products to MedAssets members under special pricing set up for them Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 3 of 27 4 (the “MedAssets Letter”). I relied upon the representations concerning commissions and compensation in selling ICU Products. 11. In and around 2003, around the same time the MedAssets Letter was sent out to Specialty Distributors, I regularly corresponded with Mike Lester, an ICU sales representative with whom I worked. I recognize his email address and sent and received emails to and from him on a regular basis during that time period. Attached hereto as Exhibit A [BG-518377] is a true and accurate copy of an email I received from Mike Lester on August 19, 2003, in which he informed me that ORHS was a member of and buying under a Group Purchasing Organization (“GPO”) called “MedAssets.” The language and content of the email is consistent with the language used by Mike Lester and is consistent with his repeated efforts to urge me to try and sell ICU Products to hospital systems, including ORHS. I understood Mr. Lester’s email to indicate that ORHS was eligible to receive the lower pricing available to MedAssets members under the MedAssets GPO described in the MedAssets Letter, and that Bimeco would be entitled to a Direct Sales commission on sales of ICU Products to ORHS as described in the MedAssets Letter if ORHS chose to purchase the product directly from ICU. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 4 of 27 5 12. The standard commission guidelines with ICU was that ICU would pay a commission of 15% on sales revenue from all ICU Products sold directly to the end users, including “commodity” products which did not include a Clave connector. According to the MedAssets Letter, the standard commission guidelines with ICU set for ICU indicated it would only pay 8% commission on the sales revenues for commodity products. But, because ICU’s main selling point was the high quality and safety of its Clave Products, the sale of commodity products comprised a small part of our total sales on behalf of ICU. 13. In the fall of 2006, based on the positive feedback from the ORHS Infection Control Department, notable success of the ICU C-1000 in reducing infection rates in the NICU, and new evidenced-based publications regarding Clave, I began to talk to representatives at ORHS in the Clinical Resource Team (“CRT”) and Healthcare Purchasing Alliance, LLC (“HPA”), the purchasing branch of ORHS, about the system-wide conversion to ICU Products. 14. In July and August of 2006, I introduced copies of medical studies with favorable reviews of ICU Clave Products to Linda Knox and Lori Shadley at ORHS, and presented them with a pricing program promoted by ICU called the “CASH Program” which involved a 20% line item price savings related to the Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 5 of 27 6 purchase by ORHS of all non-pump related IV sets. Non-pump related sets would comprise the entire line of ICU IV Products that Bimeco represented. 15. In September 2006, ICU hired a sales representative for the state of Florida named Kristin Jacobs (formerly known as Kristin Alward), who ICU represented was my direct contact in connection with the sale of ICU Products and was authorized to represent ICU in Bimeco, Inc.’s and my dealings with ICU, including pricing and commissions related to the sales of ICU Products. 16. In December 2006, I arranged a meeting between Kristin Jacobs and the clinical coordinator of the NICU at ORHS, Janet Moore. 17. On January 25, 2007, I sent an email to Ms. Jacobs, with her prior email address KAlward@icumed.com, which she used before she married and then changed her email address to KJacobs@icumed.com. I worked closely with Ms. Jacobs for three years and am familiar with her email address, her writing style, and her intense interest in convincing ORHS to convert system-wide to ICU Products. A true and accurate copy of the email is attached hereto as Exhibit B (Dep. Ex. 172) [BG-600936 – BG-600937]. 18. As a part of Exhibit B, is true and accurate copy of the email I received from Ms. Jacobs in response to the email referred to in Paragraph 17. The email is consistent with her writing style and the content is consistent with our Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 6 of 27 7 discussions concerning the promotion of ICU Products in Florida hospitals. In the February 1, 2007 email, Ms. Jacobs asked me to arrange introductions or meetings with personnel in the following department at ORHS to attempt to sell the following products: NICU (custom sets), nursing (clave, tego), and pharmacy (chemotherapy products), among others. Over the next year, I complied with her request. 19. On March 2, 2007, I sent an email to Rosaline Parsons, head of HPA at ORHS, concerning the use of ICU Products system-wide, introduced Kristin Jacobs as ICU’s sales representative, and discussed the advantage of Clave technology and the ICU CASH Pricing program. A true and accurate copy of that email is attached hereto as Exhibit C [BG-600940]. 20. I have known and worked with Rosaline Parsons for many years and have had, and continue to have, a strong professional relationship with her and her team. See Ex. C. [BG-600940] 21. In July 2007, The Bimeco Group, Inc., a Georgia corporation, was formed and I became an Account Representative and minority owner of Bimeco. I understood and operated under the belief that Bimeco had assumed the rights and obligations of Bimeco, Inc. As a result, I continued to represent all the manufacturers, including ICU, without any change in our operations. Neither Ms. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 7 of 27 8 Jacobs nor anyone else at ICU stated or implied that Bimeco had not taken the place of Bimeco, Inc. as ICU’s Specialty Distributor for the southeast United States, or that there was any difference in the way Bimeco would be paid commission going forward. 22. In July 2007, Kristin Jacobs notified me that she had a lead on attempting to sell ICU Chemo Products to ORHS through MD Anderson/ORHS, its main cancer treatment hospital, by meeting with Andrea Ledford, who is in charge of the pharmacy where chemotherapy chemicals are stored and mixed for use in the hospital. Ms. Jacobs and I worked as a team to sell ICU Chemo Products to ORHS. She consulted with me on a strategy she should use to approach Ms. Ledford. Since Ms. Jacobs was a relatively new representative, she asked me to advise her on where the actual office of the people she wanted to meet were located. I assisted Ms. Jacobs in every way she asked me to in connection with the sale of Chemo Products to ORHS system-wide. 23. Both Kristin Jacobs and other ICU representatives I worked with from July 2007 through December 31, 2014, including Matt Gingo, David Webb, Tom Sobba, Nicole Gladden, J.D. Schuff, Mike Lester, and Patrick Odea, repeatedly indicated to me that Bimeco and I were considered to be a valuable part of the ICU sales team and they relied upon my and Bimeco’s efforts, local relationships, and Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 8 of 27 9 clinical expertise to assist them as representatives of ICU to sell the full range of ICU Products, including IV Infusion (Clave) Products, Chemo Products, and commodity sets (sets which included tubing but were not a Clave Product) for members of GPOs and other potential customers. 24. I was repeatedly told by ICU sales representatives and managers, and specifically understood that for Direct Sales to end users, like ORHS, in which the “box mover” was someone other than Bimeco, I would receive a 15% commission of the sales revenue generated by the sale of all ICU Products sold to an end user with my assistance, for as long as Bimeco maintained its relationship as a Specialty Distributor for ICU, unless the ICU representatives notified me, in advance of making the sale, that the commission rate would be different or limited in some way.1 25. From 2007 through 2010 when I assisted ICU in selling ICU Products to ORHS system-wide, I was not aware of any agreement between ICU and Bimeco that the 15% Direct Sales commission expired before the termination of Bimeco as an ICU Specialty Distributor. To the extent that any ICU pricing contract expired with the customer, it was always renewed and Bimeco continued 1 For instance, when ICU notified Specialty Distributors by the MedAssets Letter that it would pay an 8% sales commission on commodity products sold to MedAsset GPO members. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 9 of 27 10 to receive commissions as long as the customer continued to purchase the product and Bimeco remained ICU’s Specialty Distributor. 26. From the fall of 2006 through the summer of 2010, in my capacity as an Account Representative of Bimeco, Inc. up to July 2007, and from August 2007 forward, in my capacity as an Account Representative for Bimeco, I operated as part of a team, including Ms. Jacobs and other ICU representatives, to attempt sell the full line of ICU products to ORHS system-wide. At no time did ICU, Kristin Jacobs, or any other ICU representative tell me or imply that Bimeco would not receive the standard 15% commission on all ICU IV Infusion (Clave) and Chemo Products sold to ORHS for as long as Bimeco continued in its relationship as a Specialty Distributor. On the contrary, while I cannot now remember the exact wording of each conversation, Ms. Jacobs and I had numerous conversations in which she and I clearly indicated a mutual expectation that Bimeco would receive the standard 15% commission for sales of ICU Products to ORHS. It was further mutually discussed and understood that each of us expected the sales revenue generated by ORHS to exceed a million dollars a year. Both Ms. Jacobs and I were excited about the prospect of succeeding in converting such a large hospital system to ICU Products because of the compensation each of us expected to receive as a result of those sales. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 10 of 27 11 27. In August 2007, I introduced Ms. Jacobs to Eugene Waterval and Jill Burton, who were educators for the Adult Intensive Care Trauma Center at ORHS and key personnel to educate as to the quality of the ICU Clave Products. Attached hereto as Exhibit D is a true and accurate copy of an email chain between Kristin Jacobs and Eugene Waterval [BG-600888 – BG-600889], in which I was cc’d at my former email address: bimecosms@earthlink.net, in which Ms. Jacobs and Mr. Waterval discuss a planned meeting for a trial and in-service of the ICU MicroClave in the Adult Trauma Intensive Care Unit. I regularly communicated with ORHS personnel, such as Mr. Waterval, and recognize his email address. Based on discussions I had with Mr. Waterval, the subject of the emails is consistent with the ongoing discussions about Ms. Jacobs and ICU Products. 28. In connection with the sale of ICU Products, hospitals and hospital units usually set up meetings with ICU so the ICU representatives, including Specialty Distributor representatives such as myself, could demonstrate how the ICU Products work. “In-service” involves a long and arduous process which requires the sales representative to spend long hours in the units so we can educate the practitioners on what the product can do and the correct protocols for their use. This process is time consuming because patient care and physician demands are their primary responsibilities and priority; we can only educate the practitioners Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 11 of 27 12 when there is a break in their primary responsibilities and must conform to the schedule of both day and night shifts. 29. Once trial in-service has been completed and the practitioners understand how to use the product, the hospital or hospital unit would then begin the “trial” in which the product currently used by the hospital or hospital unit would be removed and replaced with the ICU Product. A trial is also a long and arduous process that could last for months. The sales representative must make rounds often to re-stock each unit and hospital with product, ensure the product is being used properly during the trial, answer questions, resolve issues and complaints, and promote the advantages of the product to the practitioners to encourage them to give the product high marks in their evaluations which are reviewed by the hospital when it is being considered for purchase. It was essential that the ICU Products demonstrate superior performance in the trials if the hospital was going to decide to purchase the product. It is very difficult to convince a hospital to buy a product which demonstrates poor performance in the trials. 30. Once the product is approved for use by the hospital, the sales representative generally still must return to the purchasing hospital to train and follow-up to make sure that practitioners system-wide know how to use the Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 12 of 27 13 product. Again, this typically is a time consuming process that can take days to complete. 31. From August 2007 through December 2009, I participated in all trials of ICU Clave and Chemo Products tested in various units of ORHS, including the following: August 2007 Trials of ICU Clave (MicroClave) Products B3300, bag spike, MicroClave, stopcock and trifuse, in the Adult Intensive Trauma Car Center of ORHS. The outcome was successful and substantially reduced infection rates. April– June 2008 Three month trials of MicroClave Products on central lines in ORHS hospitals, including South Seminole Hospital and ORMC hospital Adult Intensive Trauma Care Center, the pediatric intensive care unit at Arnold Palmer Hospital, as well as other units (the “ORHS MicroClave Trials”). The outcome was successful and had a 58% reduction in infection rates. March – April 2009 Trials of the ICU Chemo Products at MD Anderson Hospital which included a two week wipe study in which samples are sent to an overseas laboratory for evaluation. The outcome was successful and “ORHS announced acceptance of ICU Chemo Products. August – October 2009 In-servicing Chemo and MicroClave Products at numerous ORHS hospitals and units. November 2009 In-service of Chemo Products in the oncology unit of Dr. Phillips Hospital. 32. In November 2007, after the successful trials in ORHS’s Adult Intensive Trauma Care Center, I met face to face with Rosaline Parsons. At that Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 13 of 27 14 meeting, I explained to her that she was not confined to purchasing ICU Products from a company called Hospira, for which ICU was an OEM (“original equipment manufacturer”). I explained to her that Bimeco, as ICU’s Specialty Distributor, and ICU could sell ICU Products directly to ORHS without going through Hospira, and probably at a lower price. I explained this to her because she stated to me she thought she could only buy ICU Products through Hospira. 33. In that meeting in November 2007, Ms. Parsons then asked me to provide her with a full price list for the full line of ICU Products, including Clave and Chemo Products. 34. Attached hereto as Exhibit E [BG-601048 – BG-601049] is a true and accurate copy of an email dated November 7, 2007, I wrote and sent to Kristin Jacobs because Ms. Parsons requested that I provide pricing for the full line of ICU Products. I explained to Ms. Jacobs that ICU should consider some sort of discount off of list price because Ms. Parsons had told me that pricing would play a significant role in the decision to purchase ICU Products since the volume of products required for a system-wide purchase would be so large. 35. On or about November 19, 2007, I received a response to my email from Ms. Jacobs, a true and accurate copy of which is attached hereto as Exhibit F [BG-601037 – BG-601042], which was forwarded to me an email from ICU Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 14 of 27 15 Corporate Account Manager, Doug Baran, and contained a full MedAssets GPO price list of both ICU IV Infusion Products and Chemo Products. 36. In a previous email from Doug Baran to Kristin Jacobs dated November 12, 2007, which was forwarded to me and contained an incomplete price list, Mr. Baran’s email instructed Ms. Jacobs to please mention that these prices “DO NOT INCLUDE DISTRIBUTION COSTS.” A true and accurate copy of the email [BG-601043 – BG-601047] is attached hereto as Exhibit G. 37. The price list I was given by ICU for submission was the standard MedAssets pricing to which ORHS already had access to as a MedAssets member, because that was the pricing Ms. Jacobs and ICU authorized me to submit. 38. In response to the instructions from Doug Baran, I added to the price the distribution fee to the “box mover” distributor, which was Owens and Minor at the time, so that Ms. Parsons would see the actual cost of the ICU Product line. A true and accurate copy of the email dated November 19, 2007, and the price list for ICU Clave and Chemo Products I sent to Rosaline Parsons by me (“MedAsset Price List”), is attached hereto as Exhibit H. (Dep. Ex. 80.) 39. The MedAssets Price List provided to me by ICU for Rosaline Parsons was disappointing because it was a standard price list which made no additional price concession for the amount of volume contemplated by the Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 15 of 27 16 purchase, but I had no authority nor the ability to offer pricing lower than that authorized by ICU. 40. Attached hereto as Exhibit I (Dep. Ex. 188) is a true and accurate copy of an email I received from Ms. Jacobs addressed to Doug Baran of ICU dated December 12, 2007 (the “Dec. 12 Email”). I recognize Ms. Jacobs’ email address and the content of the mail is consistent with our discussions concerning the sale of ICU Products to ORHS. In that email, Ms. Jacobs accurately stated that she and I “trialed the MicroClave in the Trauma ICU at ORMC” [the central hospital in the ORHS system] with Eugene Waterval and “inserviced both day and night shift.” I do not recall any other ICU personnel being present. She further noted that we had been working with Beth Rowles, who worked with Rosaline Parsons and focused on product quality review for ORHS, and Scott Brown who was in charge of infection control for ORHS. These two people were very important decision makers in the process of receiving approval to sell the ICU Products to ORHS system-wide because two of the main selling points of ICU Products were its high quality and ability to substantially reduce infection rates when used properly. 41. In the Dec. 12 Email, I also learned that Doug Baran was meeting with Rosaline Parsons the next day and I had not been invited to attend. I did not Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 16 of 27 17 attend the meeting because I was not invited. Had I been invited, I would have attended the meeting. 42. On December 12, 2007, I sent an email in response to the Dec. 12 Email providing Mr. Baran with advice regarding Scott Brown’s concerns of infection control and other recommended strategies to position a house-wide conversion. A true and accurate copy of that email is attached hereto as Exhibit J. (Dep. Ex. 189.) 43. On or about February 1, 2008, I received an email from Beth Rowles, Implementation Specialist, Materials Management, for ORHS, a true and accurate copy of which is attached hereto as Exhibit K. (Dep. Ex. 191.) Over the years, I have dealt with Ms. Rowles regularly and recognize her email address. The content of the email is consistent with our ongoing discussions concerning the trialing of ICU Products at ORHS. In this email, Ms. Rowles requested that I provide her with a “new quote on the [ICU] Microclave” on or before February 10, 2008, because ORHS “would like to move forward with trialing this product and it would be a corporate wide change” (emphasis added) (the “Feb. 1 Email”). 44. Based on and in response to the Feb. 1 Email I received from Ms. Rowles, I contacted Doug Baran of ICU and asked for two sets of prices on the ICU Clave Products. One in which the product is sent through a “box mover” other Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 17 of 27 18 than Bimeco, and one in which Bimeco was the “box mover,” or would purchase the product from ICU and deliver it to ORHS. I did not hear back from Mr. Baran so I sent him a second email dated February 5, 2008, a true and accurate copy of which is attached hereto as Exhibit L [BG-600801]. I have dealt with Doug Baran through email over the years and have sent and received emails from Doug Baran at this email address. In the email, I asked him again for the two sets of prices, as described above. 45. Mr. Baran responded to my February 5, 2008 email by sending me an email, a true and accurate copy of which is also shown on Exhibit M (Dep. Ex. 136), stating that “ORMC [ORHS] contacted me [Doug Baran] directly and ask [sic] me to give them pricing. So I see no need for bimedco [sic] to give the same bid, you are included in the quote I will give them later today.” 46. Based on the instructions I received from Mr. Baran, I did not submit new pricing to ORHS as requested by Ms. Rowles, but deferred to and relied upon ICU to negotiate pricing of ICU Products with ORHS going forward. The fact that ICU conducted price negotiations with ORHS was not unusual. ICU often negotiated pricing directly with the customer for larger volume sales to hospital systems. Bimeco’s job was to assist ICU to a point where the hospital had been sold on the ICU Products so that ICU could negotiate a price. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 18 of 27 19 47. On February 7, 2008, at 4:33 p.m. I received an email from Kristin Jacobs stating “Pricing has been submitted & ‘looks good’ – we gave them 68 cents for MicroClave & $1.05 for ext set. Roz & Nathalie know pricing.” A true and accurate copy of this email is attached hereto as Exhibit N. (Dep. Ex. 192.) 48. On April 7, 2008, trials on a type of ICU Clave Product called a MicroClave for system-wide use at ORHS began in various intensive care units in different hospitals with the ORHS system. None of these trials took place in the NICU at ORHS because, among other things, the NICU had already been using ICU Clave Products since Ms. Jungers and I introduced the product in 2002 and its personnel were already sold on the product. I was asked by Kristin Jacobs to assist ICU in conducting these trials and I did so. 49. The trials of the ICU MicroClave Products were scheduled to last, and did last, approximately three months beginning April 7, 2008. 50. On April 7, 2008, Ms. Jacobs’ son was born prematurely and was placed in a neonatal intensive care unit. On June 9, Ms. Jacobs reported that her son was still on a heart and apnea monitor and she expected to return to work mid- July. During that period, Ms. Jacobs was unavailable to cover the MicroClave trials at ORHS. Instead, with a little help from out of state ICU representatives, I was Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 19 of 27 20 involved in all aspects of the three-month trial in all units at ORHS on behalf of ICU and made regular visits to the various trial units during that period. 51. In July 2008, the ORHS trial of the MicroClave was complete and ORHS reported a drop in infection rates of 58% in comparison to the products currently in use. This was a very positive result. 52. Based on my over 25 years of experience in selling medical products to hospitals, a reduction in infection rates of 58% is a dramatic reduction and, based on my experience with selling products to ORHS, it was one of the major reasons ORHS decided to purchase ICU Clave Products system-wide. 53. Based on my years of experience in dealing with and selling products to ORHS through Ms. Parsons, I do not believe Ms. Parsons or anyone else at ORHS would have converted their system to ICU Clave Products if the products had not shown a dramatic improvement in infection rates. 54. In May or June 2009, after the trials on the Chemo Products had been completed (see Paragraph 31) with my help and participation, I was informed by Ms. Jacobs that chemotherapy product trials were a success and that ORHS had agreed to purchase ICU Chemo Products. 55. Although I have been told by Doug Baran that Rosaline Parsons was frustrated with me and Bimeco for the price Bimeco charged for the C-1000 before Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 20 of 27 21 ICU took over pricing, I have no independent reason to believe those statements are accurate. I have known and worked with Ms. Parsons for over 20 years. I know her to be a very talented, shrewd negotiator. She is determined to compel vendors to provide ORHS with the best price possible, and is not above engaging in tough sales negotiations with sales representatives to do so. Neither I nor Bimeco have ever been “banned” from ORHS and we continue to sell products other than ICU Products to ORHS to this day. I work and deal with Ms. Parsons’ HPA Team regularly and she has never given me any indication of frustration or distrust. 56. By the beginning of 2010, based on the information given to me by Ms. Jacobs, ORHS was purchasing both IV Infusion (Clave) and Chemo Products from ICU. Based on my understanding from ICU representative Ms. Jacobs and other ICU representatives I dealt with, Bimeco was entitled to the standard 15% commission on all ICU Products sold to ORHS, except for the commodity sets for which at least 8% commission was due. Yet neither Bimeco nor I were being paid a penny during 2010. 57. As my frustration grew, I called Ms. Jacobs on a regular basis to find out why Bimeco was not being paid and how unfair I believed I was being treated. In response, she finally told me to call her boss, Paul Curtin, National Sales Director for ICU. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 21 of 27 22 58. In November 2010, I spoke by phone to Paul Curtin. He promised that Bimeco would start receiving payments in a matter of weeks, but no payments were made. 59. During this time, I contacted Bimeco’s Executive Vice President, Mark Jungers, and asked him to contact ICU about failure to receive payment for sales to ORHS. 60. Although I have no direct knowledge of these discussions, in April and May of 2011, I understood that ICU offered to start making partial payments on the commissions due for sales of ICU Products to ORHS. I was not present during the communications between ICU and Bimeco and Mr. Jungers. Any statements I have expressed in emails about those discussions have been based on second hand hearsay information and my personal speculation. 61. Initially, I was pleased that ICU was at least starting to pay a portion of what was due. However, based on what I was told about the discussions, I eventually became extremely angry about how slowly ICU was in paying the commissions due and the small amount of the monthly partial payments. It was my belief that by 2012 ICU had enough time to assess the account and should go ahead and pay the remainder of the total amount I believed was due. Unfortunately, ICU Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 22 of 27 23 did not share its total sales figures with Bimeco so at that time I could only guess about the total sales commissions due. 62. I believe that the partial payments on ORHS commissions made by ICU, beginning in March 2011, were a small part of the total amount due was unjustified and that the initial partial payment should have been larger. I came to decide I would have preferred that Bimeco sue ICU for the total amount due and be done with it. Mr. Jungers and Ms. Jungers expressed a desire to proceed cautiously, with which I disagreed. 63. I expressed my anger and frustration about these paltry payments to the Jungers in emails dated July 18, 2012, attached hereto as Exhibit O, as well as similar emails. (Dep. Ex. 124.) 64. However, as angry as I was about the partial payments being made to Bimeco, I never understood that the partial payment proposed by ICU was a final or total amount ICU agreed to pay. Although I believed ICU was stalling and should pay the total amount due immediately, I understood from what Mark Jungers told me that ICU would pay additional commissions past 2011 for both Clave and Chemo Products. 65. The statements I made in those emails were made out of anger and frustration at ICU’s failure to immediately pay the commissions owed to Bimeco Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 23 of 27 24 and the Jungers’ unwillingness in 2012 to elect to proceed with litigation to collect them. I had no personal knowledge of what was said or done in Mr. Jungers’ communication with ICU because I was not present. I am not an attorney and I have no legal training. I did not now the legal effect of Bimeco’s or ICU’s actions. I did not have access to ICU’s sales records concerning ORHS and so estimates of commissions due were based on my personal conjecture and not facts. In using the term “settlement” in my emails, I did not intend to imply that I thought Bimeco had released or terminated any of its claims against ICU. I was referencing Bimeco’s willingness to let ICU slowly pay its obligations over a period of time rather than file a lawsuit to force payment of the full amount due immediately and as it came due in the future. 66. I was specifically told by Mark Jungers that this payment was not final and ICU agreed more was due and would pay it down the road when they had a better understanding of what was due. Further, I understood that ICU agreed to pay additional amounts for Chemo Products when they were reintroduced into ORHS. Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 24 of 27 I declare under penalty of perjuiy under the laws of the United States of America that the foregoing is true and coiTect. day of July, 2016 at tixxcW{rQ-e G-ty Executed this ^ [CITY], Geo [STATE]. STEWART SOLOMON 25 Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 25 of 27 CERTIFICATE OF SERVICE I hereby certify that on this 11th day of July, 2016, I served the foregoing with the Clerk of Court using the CM/ECF system which will automatically send e-mail notification of such filing to the following attorney(s) of record: Charles C. Murphy, Jr. cmurphy@vaughanandmurphy.com Ellen G. Schlossberg eschloss@vaughanandmurphy.com Vaughan & Muprhy 260 Peachtree Street, N.W., Suite 1600 Atlanta, GA 30303-1237 Henry D. Fellows, Jr. hfellows@fellab.com Christina Baugh cbaugh@fellab.com Fellows LaBriola LLP Suite 2300 South Tower 225 Peachtree Street, N.E. Atlanta, GA 30303 s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 1 Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 26 of 27 LOCAL RULE 5.1 CERTIFICATION I, JOHN C. PORTER, JR., certify that the foregoing has been prepared in Times New Roman 14 font and is in compliance with United States District Court, Northern District of Georgia Local Rule 5.1. s/ John C. Porter, Jr. John C. Porter, Jr. Georgia Bar No. 584800 jporter@sbpllplaw.com J. Michael Bishop Georgia Bar No. 058610 mbishop@sbpllplaw.com COUNSEL FOR PLAINTIFF SMILEY BISHOP & PORTER LLP 1050 Crown Pointe Parkway Suite 1250 Atlanta, GA 30338-7707 Telephone: (770) 829-3850 Facsimile: (770) 673-0270 2 Case 3:15-cv-00123-TCB Document 94-6 Filed 07/11/16 Page 27 of 27 EXHIBIT A Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 1 of 15 EXHIBIT B Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 2 of 15 EXHIBIT C Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 3 of 15 EXHIBIT D Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 4 of 15 EXHIBIT E Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 5 of 15 EXHIBIT F Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 6 of 15 EXHIBIT G Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 7 of 15 EXHIBIT H Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 8 of 15 EXHIBIT I Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 9 of 15 EXHIBIT J Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 10 of 15 EXHIBIT K Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 11 of 15 EXHIBIT L Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 12 of 15 EXHIBIT M Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 13 of 15 EXHIBIT N Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 14 of 15 EXHIBIT O Case 3:15-cv-00123-TCB Document 94-7 Filed 07/11/16 Page 15 of 15