Angiodynamics, Inc. v. Biolitec AG
910 F. Supp. 2d 346
D. Mass.2012Background
- Defendants Biolitec, Inc. (BI) and Biolitec AG (BAG) vs. AngioDynamics, Inc. claim BAG looted BI to sentence BI to be judgment-proof on indemnity obligations.
- BI is obligated to indemnify AngioDynamics for patent litigation costs; AngioDynamics obtained a New York judgment against BI.
- BAG planned a downstream merger with its Austrian subsidiary, threatening enforcement of US judgments in Austria.
- A TRO/preliminary injunction barred the merger and asset transfers during the litigation.
- BI and BAG allegedly transferred assets within the Biolitec group to defeat collection, supported by an insider Spaniol declaration.
- Court reaffirmed the injunction after hearing; Defendants sought reconsideration and an evidentiary hearing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Likelihood of success on the merits | Plaintiff argues fraud and veil-piercing show likely success | Defendants contend discovery is incomplete and challenged claims remain | Plaintiff likely to succeed on some claims. |
| Irreparable harm | Merger would render enforcement impossible or impracticable | Some harm to BAG but minor compared to potential loss of judgment | Irreparable harm established. |
| Balance of harms | Enforcement of judgment outweighs BAG's temporary merger benefits | Harm to BAG from delay is modest | Balance of harms favors plaintiff. |
| Public interest | Preserving ability to satisfy judgment serves public interest | Public interest not favored by injunction due to corporate move | Injunction in the public interest. |
Key Cases Cited
- Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal, 546 U.S. 418 (U.S. 2006) (preliminary injunction standards and likelihood of success considerations)
- Winter v. Natural Resources Defense Council, 555 U.S. 7 (U.S. 2008) (establishes the four-factor preliminary injunction test)
- ADB Investors, Inc. v. Davis, 926 F.2d 1248 (1st Cir. 1991) (five-factor test for actual intent to defraud in fraudulent conveyance)
- Platten v. HG Bermuda Exempted Ltd., 437 F.3d 118 (1st Cir. 2006) (presumption of corporate separateness; veil piercing factors)
- Max Sugarman Funeral Home, Inc. v. ADB Investors, 926 F.2d 1248 (1st Cir. 1991) (illustrates the five ADB factors in fraud context)
- Evans v. Multicon Construction Corp., 30 Mass.App.Ct. 728, 574 N.E.2d 395 (Mass. App. Ct. 1991) (Mass. law six-faceted approach to piercing corporate veil)