250 A.3d 122
Me.2021Background:
- Meridian Medical Systems, LLC (MMS) was founded by Kenneth L. Carr to develop microwave technologies; Carr was removed as chairman/CEO by co-managers (his son Jeff Carr and Robert Allison) in 2013.
- ACT (formerly Advanced Cardiac Therapeutics) licensed MMS technology by 2013; New Enterprise Associates (NEA) became ACT’s controlling shareholder in 2014; Medtronic later acquired ACT.
- MMS liquidated in Chapter 7 (2015); Kenneth Carr purchased certain MMS claims from the bankruptcy estate and sued as assignee against ACT, NEA, and Medtronic alleging aiding-and-abetting breaches of fiduciary duty, tortious interference, and conspiracy.
- The Business & Consumer Docket dismissed the first amended complaint under M.R. Civ. P. 12(b)(6) for failure to state a claim; Carr appealed.
- The Maine Supreme Judicial Court affirmed: it rejected conspiracy as an independent tort, recognized limited civil aiding-and-abetting for fiduciary breaches but required actual knowledge and substantial assistance, and found Carr’s aiding-and-abetting and tortious-interference allegations factually insufficient.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is civil conspiracy an independent tort under Maine law? | Carr pleaded conspiracy as a discrete cause of action. | Conspiracy is not an independent basis for civil liability. | Conspiracy is not an independent tort; claim fails. |
| Can ACT/NEA be liable for aiding and abetting co-managers' breach of fiduciary duty, and did FAC plead it? | ACT/NEA corrupted co-managers and substantially assisted breaches. | FAC pleads only ordinary business dealings; no actual knowledge or substantial assistance alleged. | Court: aiding-and-abetting may be recognized, but requires actual knowledge and substantial assistance; FAC lacks specific factual allegations—dismissed. |
| Is the tortious-interference claim viable (including interference with prospective economic advantage)? | NEA/ACT thwarted a prospective advantage (warrant/Abbott transaction) via quid pro quo and coercion. | ACT cannot interfere with its own contract; no allegations of fraud or intimidation of third parties by NEA. | Dismissed: ACT cannot interfere with its own contract; no pleaded fraud/intimidation; allegations speculative. |
| Is Medtronic liable as successor to ACT? | Medtronic (via merger/acquisition) should be vicariously liable for ACT’s conduct. | Transaction documents indicate parent/subsidiary relationship; successor liability disputed. | Court did not resolve successor-liability issue because claims against ACT/NEA failed; dismissal affirmed on other grounds. |
Key Cases Cited
- Cohen v. Bowdoin, 288 A.2d 106 (Me. 1972) (conspiracy is not an independent civil tort)
- Barnes v. McGough, 623 A.2d 144 (Me. 1993) (recognized civil tort claims against third parties who substantially assisted wrongdoing in context of business transactions)
- Halberstam v. Welch, 705 F.2d 472 (D.C. Cir. 1983) (formulation of aiding-and-abetting elements: knowledge and substantial assistance)
- Cent. Bank of Denver v. First Interstate Bank of Denver, 511 U.S. 164 (U.S. 1994) (cautions against overly broad civil aiding-and-abetting liability)
- Steeves v. Bernstein, Shur, Sawyer & Nelson, P.C., 718 A.2d 186 (Me. 1998) (elements of breach of fiduciary duty)
- Rosenthal v. Rosenthal, 543 A.2d 348 (Me. 1988) (business-judgment rule; courts generally defer to business decisions absent bad faith)