In NuVasive, Inc. v. Day, the First Circuit recently affirmed a $1.7M award of damages and attorneys’ fees in a noncompete suit brought by a medical device company against one of its former sales representatives.
In the appeal, Timothy Day challenged the district court’s orders requiring him to pay NuVasive for his contractual breaches and spoliation of evidence, assessments that arose out of Day’s interactions with NuVasive customers on behalf of Day’s new employer, Alphatec Spine, Inc., in violation of noncompetition and nonsolicitation provisions in Day’s employment contract with NuVasive.
Day asserted that the district court erred in finding the requisite causal relationship between his improper interactions and the decision of three surgeons at Beth Israel Deaconess Medical Center (“BIDMC”), NuVasive’s largest account in the Boston market, to switch from NuVasive to Alphatec as their primary supplier of spine-related surgical products. He suggested the district court’s finding of a causal relationship was based solely on the dramatic surge in the surgeons’ use of Alphatec products following Day’s move to that company.
The First Circuit was unpersuaded by Day’s argument, because it disregarded substantial circumstantial evidence in the record, including multiple instances when Day interacted with BIDMC and its surgeons in the months immediately after his departure from NuVasive and evidence that Day was the primary contact for BIDMC during the relevant time. Indeed, the evidence showed that Day was involved in negotiating the pricing of Alphatec products for use at BIDMC, planning meetings between Alphatec’s CEO and Boston area surgeons, including Dr. Paul Glazer, the largest user of NuVasive products at BIDMC, obtaining approval for the use of an Alphatec spinal fusion system at BIDMC, then attending when Dr. Glazer used the Alphatec system for the first time in the operating room.
Day’s reliance on Dr. Glazer’s testimony that Day had no influence on his decision to switch from NuVasive to Alphatec’s products was also unavailing, as the district court was free to reject the disclaimer given undisputed evidence that Day repeatedly engaged with Dr. Glazer when he was prohibited from doing so and expert testimony concerning the influential role sales representatives play in retaining the business of surgeons.
While the evidence relating to two other BIDMC surgeons was not as plentiful, the First Circuit found it was adequate to support the district court’s finding against Day, particularly where Day counted all three surgeons among his successes in an internal Alphatec report.
Ultimately, the First Circuit was satisfied that “the district court identified a pattern of improper activity seemingly aimed at switching the affiliation of multiple surgeons from NuVasive to Alphatec … and reached the reasonable conclusion that the campaign worked.”
It should also be noted that Day’s spoliation of evidence proved problematic for him in two crucial respects. First, it entitled NuVasive to an adverse inference that certain text messages Day failed to preserve were unfavorable to him on the issue of damages. And second, it entitled NuVasive to attorneys’ fees and costs to compensate the company for two years of expenses it incurred because of the spoliation.