## Facts

- Biolitec, Inc. manufactured laser and fiber products and supplied them to AngioDynamics, Inc. for resale under a 2002 Supply and Distribution Agreement (SDA).
- The SDA included provisions addressing defense and indemnification for certain third-party patent infringement claims and reciprocal obligations tied to unauthorized product modifications.
- AngioDynamics was sued for patent infringement in two matters (Diomed and VNUS) involving products supplied by Biolitec, and AngioDynamics sought indemnification under the SDA.
- In the Diomed matter, Biolitec refused to accept a formal indemnity obligation but contributed about $1.6 million toward AngioDynamics’ defense under a joint defense arrangement; a jury later returned a verdict against AngioDynamics exceeding $9 million.
- After contributing to the defense, Biolitec demanded reimbursement of the $1.6 million; AngioDynamics refused.
- AngioDynamics filed an indemnification action in the Northern District of New York on January 2, 2008 (served January 15).
- Biolitec filed this action in the District of Massachusetts on January 11, 2008 (served January 14), asserting declaratory judgment, breach of contract, quantum meruit/unjust enrichment, and a Massachusetts ch. 93A claim.
- AngioDynamics moved to dismiss for failure to state a claim and, alternatively, to transfer to the Northern District of New York based on the first-filed rule and convenience.
- A magistrate judge recommended denying dismissal and granting transfer; no objections were filed, and the district judge adopted the recommendation.

## Issues

1. Whether Biolitec’s complaint stated plausible claims for declaratory relief, breach of contract, quantum meruit/unjust enrichment, and Massachusetts ch. 93A under Rule 8(a)(2) and Rule 12(b)(6).
2. Whether the action should be dismissed or transferred to the Northern District of New York under the first-filed rule and 28 U.S.C. § 1404(a) given the earlier-filed, overlapping New York case.
3. Whether sanctions were warranted based on Biolitec’s decision to file in Massachusetts.

## Decision

- The motion to dismiss was denied because the complaint provided sufficient notice of the SDA relationship, the underlying patent suits, Biolitec’s defense-cost contribution, and the alleged refusal to reimburse or recognize Biolitec’s asserted rights.
- The motion to transfer was granted, and the case was transferred to the Northern District of New York under the first-filed rule and § 1404(a), rather than dismissed.
- The request for sanctions was denied because Biolitec’s filing was not frivolous.

## Legal Principles

- Rule 8(a)(2) requires a short and plain statement showing entitlement to relief; at the pleading stage, allegations are taken as true and need only provide fair notice of the claim and its grounds.
- When substantially similar actions involving the same parties and issues are filed in different federal courts, the first-filed rule generally favors proceeding in the forum where the action was first filed absent special circumstances.
- Under 28 U.S.C. § 1404(a), a court may transfer an action for convenience and in the interest of justice; avoiding duplicative litigation and inconsistent rulings supports transfer where parallel proceedings and overlapping claims exist.
- Sanctions are inappropriate where the challenged filing has a colorable basis and is not frivolous or abusive.

## Conclusion

The court held that Biolitec adequately pleaded its contract, restitutionary, declaratory, and ch. 93A theories, but transferred the case to the Northern District of New York because an earlier-filed, substantially identical action between the same parties was already pending there and consolidation would avoid duplicative proceedings.


Biolitec, Inc. v. AngioDynamics, Inc., 581 F. Supp. 2d 152 (D. Mass. 2008)