The case began when St. Jude and Blaire Kiland sued Natick, Mass.-based BSX in the U.S. District Court for Northern California Sept. 13, alleging that it broke California rules in luring Kiland away from his then-employer Medtronic Inc. (NYSE:MDT) in North Dakota.
"Boston Scientific fraudulently induced Kiland to leave and forego opportunities with Medtronic, to leave North Dakota where he was a successful CRM sales person, and move to California to accept a long-term agreement with Boston Scientific," according to court documents.
To induce Kiland to jump ship, Boston Scientific allegedly made a series of false representations, promising him that it was not aware of any "upcoming product problems or recalls" that would affect the "strong and stable sales territory in Northern California ($18 to $25 million in total revenue)," according to the documents.
But the company was then under investigation by the U.S. Dept. of Justice for its allegedly deliberate concealment of safety problems with implantable cardiac defibrillators made by its Guidant Corp. subsidiary. The feds handed down a criminal indictment on the charges in February and Guidant pleaded guilty in April, agreeing to pay more than $296 million to settle the case. Concurrently, the company was forced to hold all CRM sales for a month this spring, after discovering it had failed to make a pair of required filings with the Food & Drug Administration.
"Had Kiland known the truth, [he] would not have accepted a position with Boston Scientific, would not have signed any agreement relating thereto, and would not have relocated from North Dakota to California and left his position with Medtronic," according to court documents. "In an effort to mitigate his damages and continue his career in CRM sales, Kiland sought employment with St. Jude."
The lawsuit also argues that a non-compete agreement Boston Scientific had Kiland sign violates California’s anti-trust laws.
BSX counter-sued Sept. 24 in the U.S. District Court for Minnesota, arguing that Kiland violated the terms of his contract when he quit to join St. Jude.
Now St. Jude wants a Minnesota judge to dismiss, stay or transfer that lawsuit while its California case is decided.
"Boston Scientific is forum shopping — plain and simple," according to court documents. "It predicates the instant action upon the demonstrably false notion that its employment agreement with Kiland is comprised of only one of the two contemporaneously signed documents of which the ‘entire’ Employment Agreement is actually composed, both of which are expressly at issue in the First Filed Action. Boston Scientific does so because the signed document upon which it seeks to solely rely here contains Minnesota choice-of-forum and choice-of-law provisions, while the other contemporaneously signed document that Boston Scientific wishes were non-existent expressly confers an option to litigate disputes in either Massachusetts or in ‘[Kiland’s] last … primary work location,’ which undisputedly was California."