Avid Bioservices Inc (CDMO)

[cheynew]

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
EASTERN DIVISION
PEREGRINE PHARMACEUTICALS,
INC., a Delaware Corporation,
Plaintiff,
vs.
CLINICAL SUPPLIES
MANAGEMENT, INC., a North
Dakota Corporation,
Defendant.
Case No. 8:12-cv-01608-JGB-AN
NOTICE OF MOTION FOR
PARTIAL SUMMARY JUDGMENT
BY DEFENDANT CLINICAL
SUPPLIES MANAGEMENT, INC.
[Filed Concurrently With Memorandum of
Points and Authorities in Support of
Motion for Summary Judgment; Separate
Statement of Uncontroverted Facts and
Conclusions of Law; Declarations of
Matthew L. Marshall, Jeanette Bleecker
and Angela Calkins Humrich;
Compendium of Exhibits [Proposed]
Order]
Date: May 4, 2015
Time: 9:00 a.m.
Judge: Hon. Jesus G. Bernal
Location: Courtroom 1
Action Filed: September 24, 2012
Trial Date: October 20, 2015

TO ALL PARTIES AND TO THEIR ATTORNEYS OF RECORD:
PLEASE TAKE NOTICE that on May 4, 2015, at 9:00 a.m., or as soon
thereafter as the matter may be heard before the Honorable Jesus G. Bernal, in
Courtroom 1 of the United States District Court, Central District of California, located
at the George E. Brown, Jr. Federal Building and United States Courthouse, 3470
Twelfth Street, Riverside, California 92501-3801, Defendant Clinical Supplies
Management, Inc. (“CSM”), will and hereby does, move for partial summary
judgment, pursuant to Rule 56 of the Federal Rules of Civil Procedure (“FRCP”), on
the following grounds:
1. The second cause of action for Negligence in barred by the economic
loss doctrine;
2. The third cause of action for Negligence Per Se is barred by the
economic loss doctrine;
3. The fourth cause of action for Negligent Misrepresentation is barred by
the economic loss doctrine;
4. The fifth cause of action for Constructive Fraud is barred by the
economic loss doctrine;
5. The fourth cause of action for Negligent Misrepresentation cannot be
established as a matter of law;
6. The fifth cause of action for Constructive Fraud cannot be established as
a matter of law.
This Motion is made following the conference of counsel pursuant to Local
Rule 7-3 which took place on March 6, 2015, between Matthew L. Marshall, counsel
for CSM, and Charles T. Hoge, counsel for Plaintiff Peregrine Pharmaceuticals, Inc.
This Motion is based on this Notice of Motion, the accompanying
Memorandum of Points and Authorities, the accompanying Separate Statement of
Uncontroverted Facts and Conclusions of Law, the supporting Declarations, the
Compendium of Exhibits, the [Proposed] Order, and the pleadings and papers on file

in this action and on such other and further evidence as may properly be before this
Court at the hearing on the Motion.
DATED: March 27, 2015 MORRIS POLICH & PURDY LLP
By: /s/ Robert Hernandez
Robert Hernandez
[e-mail]
Anthony G. Brazil
[e-mail]
Matthew L. Marshall
[e-mail]
1055 W. Seventh Street, 24th Floor
Los Angeles, California 90017
Tel: [phone]
Fax: [phone]
Attorneys for Defendant
Clinical Supplies Management, Inc.

DECLARATION OF JEANETTE BLEECKER
I, Jeanette Bleecker, declare as follows:
1. This Declaration is submitted in support of CSM’s Motion for Partial
Summary Judgment. I know of all of the following from my personal knowledge and,
if called as a witness, could and would competently testify thereto.
2. I was previously employed at Clinical Supplies Management, Inc.
(“CSM”) during the years 2002-2011. During the years 2008-2011, my position at
CSM was Project Manager. As a Project Manager, my duties and responsibilities
included, but were not limited to, responsibility for conducting packaging and
labeling, dispensing, and distribution of clinical trial material and ancillary supplies,
the creation of batch records, and performing drug reconciliation and generating
accountability and reconciliation reports in the management of clinical trials.
3. I was CSM’s Project Manager for a Phase II clinical trial of Peregrine
Pharmaceuticals, Inc.’s (“Peregrine”) cancer drug, Bavituximab (“the PPHM 0902
trial”), from its inception in February 2010 until I left my employment at CSM in July
2011.
4. In March of 2010, Peregrine retained CSM to provide certain clinical
trial services for the PPHM 0902 trial. Other services pertaining to other aspects of
the PPHM 0902 trial were performed by vendors other than CSM.
5. On March 18, 2010, CSM and Peregrine signed a Master Services
Agreement (“MSA”) which governed the clinical trial services that CSM would
perform for Peregrine in the PPHM 0902 trial, and any other clinical trial on which
the parties would work. A true and correct copy of the MSA that was signed by
Joseph Shan, Peregrine’s Vice-President of Clinical and Regulatory Affairs, is filed
concurrently herewith in the Compendium of Exhibits as Exhibit “C.” Although I did
not participate in the drafting and negotiation of the MSA, I became aware of its
existence during my work as CSM’s Project Manager for the PPHM 0902 trial.

6. The specific services that CSM was to provide to Peregrine in the PPHM
0902 trial were set forth in a Work Order and subsequent Change Orders, as is
provided in Sections 1 and 2 of the MSA. The Work Order for the PPHM 0902 trial
was agreed to by Peregrine and CSM and was signed by Peregrine’s Vice-President
of Clinical and Regulatory Affairs, Joseph Shan, on March 16, 2010, a true and
correct copy of which is filed concurrently herewith in the Compendium of Exhibits
as Exhibit “D.” Subsequent change orders for the PPHM 0902 trial were also
negotiated and approved by Peregrine.
7. Pursuant to the terms of the Work Order for the PPHM 0902 trial, CSM
was required, among other tasks, to “develop packaging and labeling requirements”
[see Exhibit “D,” Work Order at p. 2 (CSM 0016282), Section entitled “Scope of
Services,” bullet point 8.] This was consistent with CSM’s usual practice of creating
a “Packaging & Labeling Requirements” document (“PLR”) once a Work Order was
in place.
8. A PLR is prepared for every clinical trial in which CSM agrees to
provide packaging and labeling services and is prepared according to specific
requirements authorized by the trial sponsor for that specific clinical trial. Each PLR
is unique to the clinical trial to which it applies. The purpose of the PLR is to
describe each packaging and labeling effort to be conducted by CSM as requested by
the client for its study. The PLR document may set forth various sections related to
that effort, including the study description, the study details, the packaging design,
material requirements, sample label requirements, storage and distribution, sampling,
responsibilities, and any additional sections or details as appropriate. Once the PLR
is completed, both the CSM Project Manager for the study and a second CSM Project
Manager sign off on the document and it is forwarded to the client for signature. If
the client did not initially approve the draft PLR, it was my experience and general
practice that an exchange of proposed revisions would occur until a final, agreedCase
upon PLR was finalized by the parties, and the packaging and labeling effort would
not occur until the PLR was signed by the client.
9. On or before March 5, 2010, I prepared a draft PLR, and on March 5,
2010, I emailed the draft of the proposed PLR for PPHM 0902 to A.J. Leyco, Joseph
Shan, and Janet Nuttall of Peregrine. I prepared the draft PLR based on information
provided to me by Mr. Leyco and others at Peregrine about the intended packaging
and labeling of the clinical trial materials for PPHM 0902. At all times during my
involvement with the PPHM 0902 trial, Mr. Leyco was my primary point of contact
with Peregrine and I am informed and believe that he served as Peregrine’s Project
Manager for the PPHM 0902 trial. A true and correct copy of my March 5, 2010
email to Peregrine to which I attached the draft PLR is filed concurrently herewith in
the Compendium of Exhibits as Exhibit “E.”
10. On March 9, 2010, Mr. Leyco responded with his proposed revisions to
the draft PLR. A true and correct copy of his email to which he attached his
proposed revisions to the draft PLR is filed concurrently herewith in the
Compendium of Exhibits as Exhibit “E,” and it is part of the same email string that
includes my initial email to which I attached the draft PLR.
11. I incorporated Mr. Leyco’s proposed revisions into the revised and final
PLR document, and I signed the final PLR on March 12, 2010. My backup Project
Manager for the PPHM 0902 trial was Laura Lehan, and she also signed the PLR on
March 12, 2010. Joseph Shan, Peregrine’s Vice-President of Clinical and Regulatory
Affairs, signed the PLR on March 15, 2010. A true and correct copy of the final and
signed PLR is filed concurrently herewith in the Compendium of Exhibits as Exhibit
“F.”
12. One of the requirements of the PLR was that the treatment groups for the
PPHM 0902 trial (A, B or C) were to be assigned by CSM to the study drug at the
time of packaging to maintain the study blind. Specifically, the PLR states the
following requirement at seven (7) locations in the document: “*Treatment Group to
be assigned by CSM at time of packaging to maintain study blind.”
13. The PPHM 0902 trial was intended to be a double-blinded study and
pursuant to Peregrine’s own description of the study, the treatment each patient was to
receive was not to be disclosed to the study investigators, study center personnel,
patients, Peregrine or its representatives. The blind of the study had been potentially,
if not actually, compromised due to the fact that the assignment of the treatment
groups to the doses of the study drug had been disclosed (on several occasions,
including in writing) to Peregrine and other blinded individuals and/or vendors. I
discussed the potential, if not actual, compromise of the study blind with A.J. Leyco
prior to sending him the draft PLR. It is my understanding that Peregrine now
disputes that these disclosures compromised the blinding of the PPHM 0902 trial.
Nonetheless, it was because of this potential or actual compromise of the study blind
that the language “*Treatment Group to be assigned by CSM at time of packaging to
maintain study blind” was included in the draft and final PLR. At no time after I sent
the draft PLR to Mr. Leyco, Mr. Shan and Ms. Nuttall on March 5, 2010, did any of
these individuals, or anyone else from Peregrine, inform me that CSM, despite the
language in the PLR, was not supposed to assign the treatment groups at the time of
packaging to maintain the study blind, and at no time did anyone from Peregrine raise
any objections, questions, or comments regarding the inclusion of the terms
“*Treatment Group to be assigned by CSM at time of packaging to maintain study
blind” in the PLR.
14. Pursuant to the specific requirements set forth in the PLR, I assigned the
treatment groups to the doses of the study drug at the time that CSM packaged the
study drug to maintain the study blind. By assigning treatment groups to the doses of
the study drug at the time of packaging, Peregrine (and other blinded individuals
and/or vendors to which the assignment of the treatment groups to the doses of the study drug had been previously disclosed) would not know to which dose each
treatment group was assigned, and thus the blinding of the study was maintained.
15. I am familiar with a document entitled ClinPhone CompactTM Project
Requirements Specification For: PPHM 0902 (“PRS.”) I am informed and believe
that the PRS was prepared by one of Peregrine’s other vendors, Perceptive
Informatics (“Perceptive.”)
16. By its terms, the PRS describes, in detail, the functional requirements to
be developed by Perceptive in order to provide interactive voice and/or internet based
services for the PPHM 0902 trial. A true and correct copy of that portion of the PRS
(Section 2. Introduction, Page 7 of 84) which identifies its purpose is filed
concurrently herewith in the Compendium of Exhibits as Exhibit “H.”
17. The terms of the PRS require that Peregrine approve the terms of the
PRS prior to Perceptive beginning any substantive programming and technical
development relating to the IVR/IWR services (Section 2. Introduction, Page 7 of 84,
and Section 2.1. Changes to the Project Requirements, Page 7 of 84.) Since CSM did
not have any contract with Perceptive, and since there were no references in the PRS
that specifically identified CSM’s responsibilities, processes or requirements for the
PPHM 0902 trial, I signed and returned the PRS in an email to Peter Jehlen of
Perceptive dated April 15, 2012, a true and correct copy of which is filed
concurrently herewith in the Compendium of Exhibits as Exhibit “G.”
18. I was not part of the communications between Perceptive and PPHM, if
any, pertaining to the preparation of the PRS and the specific services that Perceptive
was going to provide for PPHM 0902. At no time did Peregrine request that I
communicate directly with Perceptive or any other vendor regarding the PLR or its
requirement that CSM was to assign treatment groups at the time of packaging to
maintain the study blind. I have not seen, nor was I provided, nor do I have any
knowledge of any terms of any services agreement(s) between PPHM and Perceptive.

19. I am informed and believe that Peregrine has contended that either CSM
or myself should have alerted either Peregrine or Perceptive to the information set
forth in Section 6 of the PRS (Page 27 of 84) which sets forth, among other things, an
assignment of the treatment groups (A, B and C) to the doses of the study drug. A
true and correct copy of Section 6 of the PRS is filed concurrently herewith in the
Compendium of Exhibits as Exhibit “H.” However, the terms of Section 6 (Page 27
of 84) also provide that Peregrine “should ensure that the above descriptions are
correct.” Elsewhere in the PRS in Section 2 and Section 2.1 (Page 7 of 84,)
Peregrine is required “to approve the PRS prior to any substantive programming and
technical development” by Perceptive pertaining to the interactive services that it
agreed to provide in the PRS. A true and correct copy of those portions of the PRS is
filed concurrently herewith in the Compendium of Exhibits as Exhibit “H.”
20. Based on the language of these provisions of the PRS, the lack of any
services agreement between CSM and Perceptive, and the lack of any specific
instructions from Mr. Leyco or anyone at Peregrine to me to do anything in regard to
the terms used in the PRS, I had no belief or understanding that CSM was required to
do anything with regard to reviewing the terms of the PRS for accuracy. I signed the
PRS on April 13, 2010, as requested, so that Perceptive could begin its work on the
PPHM 0902 trial, and returned the signature page to Peter Jehlen of Perceptive via an
email on April 15, 2010, a true and correct copy of which is filed concurrently
herewith in the Compendium of Exhibits as Exhibit “G.”
21. Based on the fully executed version of the PRS that was provided to CSM,
I am informed and believe that A.J. Leyco of Peregrine signed the PRS on April 13, 2010
0578166;1 7
DECLARATION OF JEANETTE BLEECKER IN SUPPORT OF MOTION FOR
PARTIAL SUMMARY JUDGMENT

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