Cacchillo v. Insmed, Inc.
551 F. App'x 592
2d Cir.2014Background
- Plaintiff Angeline Cacchillo enrolled in a Phase IIB clinical trial of Insmed’s drug IPLEX and later sued Insmed under New York law for breach of contract, fraud, and negligent misrepresentation after she was not provided ongoing access to IPLEX.
- Cacchillo alleged an implied-in-fact contract promising continued supply of IPLEX after the trial (via market, compassionate use, or future trials) until she died or was cured.
- District Court granted summary judgment for Insmed; Cacchillo appealed. This Court reviews de novo.
- Key disputed facts: whether a binding contract existed with sufficiently definite terms; whether the Statute of Frauds barred enforcement; whether promissory estoppel could overcome the Statute of Frauds; and whether statements by Insmed representatives/web content amounted to fraud or negligent misrepresentation.
- Record showed Cacchillo had long sought trial participation and likely would have joined the Phase IIB trial regardless of Insmed’s website or staff statements, diminishing reliance-based claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence/enforceability of contract | An implied-in-fact contract obligated Insmed to supply IPLEX post-trial indefinitely | No contract with definite terms; if implied, Statute of Frauds applies because obligations could extend beyond one year | Summary judgment: Statute of Frauds bars breach claim because obligations were indefinite and not performable within one year |
| Statute of Frauds applicability | Could be performed within one year via denial of compassionate use, poor response, alternative cure, or death | Those events either terminate obligations (not performance) or are contingencies exercisable only by plaintiff; thus not satisfying one-year performance rule | Held: Events cited would defeat the contract rather than effect Insmed’s performance; Statute of Frauds applies |
| Promissory estoppel to overcome Statute of Frauds | Promises/representations (website, staff statements) induced reliance to join trial; estoppel should apply despite lack of written contract | Reliance was not such that it caused an unconscionable injury; plaintiff would have joined trial anyway | Held: No unconscionable injury shown; promissory estoppel fails |
| Fraud / Negligent misrepresentation | Statements (e.g., ‘‘you’ll be put on compassionate care’’) and website were material misrepresentations inducing reliance | Statements were not shown to be false, knowingly made, or to have caused reasonable detrimental reliance | Held: Plaintiff failed to raise triable issues on fraud or negligent misrepresentation; summary judgment for defendant affirmed |
Key Cases Cited
- Burg v. Gosselin, 591 F.3d 95 (2d Cir. 2010) (standard of review on summary judgment)
- Harsco Corp. v. Segui, 91 F.3d 337 (2d Cir. 1996) (elements of breach of contract under New York law)
- Guilbert v. Gardner, 480 F.3d 140 (2d Cir. 2007) (Statute of Frauds: performance must be possible within one year)
- Burke v. Bevona, 866 F.2d 532 (2d Cir. 1989) (termination contingencies exercisable only by plaintiff do not satisfy one-year performance rule)
- Cyberchron Corp. v. Calldata Sys. Dev., Inc., 47 F.3d 39 (2d Cir. 1995) (promissory estoppel elements and unconscionable injury standard to overcome Statute of Frauds)
- Crigger v. Fahnestock & Co., Inc., 443 F.3d 230 (2d Cir. 2006) (elements of common-law fraud)
- Hydro Investors, Inc. v. Trafalgar Power Inc., 227 F.3d 8 (2d Cir. 2000) (elements of negligent misrepresentation under New York law)
- Darby Trading Inc. v. Shell Int’l Trading & Shipping Co. Ltd., 568 F. Supp. 2d 329 (S.D.N.Y. 2008) (distinguishing events that defeat a contract from events that constitute performance)