Judge Richard S. Whitney, Case Number: 37-2017-00038583-CU-BC-CTL, Date: 2024-04-26 Tentative Ruling

Judge: Richard S. Whitney, Case: 37-2017-00038583-CU-BC-CTL, Date: 2024-04-26 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - April 25, 2024

04/26/2024 10:30:00 AM C-68 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Richard S. Whitney

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Civil - Unlimited Breach of Contract/Warranty Motion Hearing (Civil) 37-2017-00038583-CU-BC-CTL ALPHATEC SPINE INC VS NUVASIVE INC [E-FILE] CAUSAL DOCUMENT/DATE FILED:

TENTATIVE RULING: DEFENDANT ALPHATEC SPINE INC.'S MOTION FOR JUDGMENT NOTWITHSTANDING THE VERDICT is DENIED.

Defendant Alphatec Spine, Inc. ('Defendant') moves under CCP section 629. Plaintiff NuVasive, Inc.

('Plaintiff') opposes the motion, but part of the motion not addressed herein was resolved by stipulation.

CCP section 663 provides in relevant part: A judgment or decree, when based upon a decision by the court, or the special verdict of a jury, may, upon motion of the party aggrieved, be set aside and vacated by the same court, and another and different judgment entered, for either of the following causes, materially affecting the substantial rights of the party and entitling the party to a different judgment: 1. Incorrect or erroneous legal basis for the decision, not consistent with or not supported by the facts; and in such case when the judgment is set aside, the statement of decision shall be amended and corrected.

2. A judgment or decree not consistent with or not supported by the special verdict.

(Code Civ. Proc., § 663.) 'A motion for judgment notwithstanding the verdict may be granted only if it appears from the evidence, viewed in the light most favorable to the party securing the verdict, that there is no substantial evidence in support.' (Sweatman v. Department of Veterans Affairs (2001) 25 Cal.4th 62, 68.) 'The trial court's discretion in granting a motion for judgment notwithstanding the verdict is severely limited.' (Hansen v. Sunnyside Products, Inc. (1997) 55 Cal.App.4th 1497, 1510 [Citation omitted].) 'If there is any substantial evidence, or reasonable inferences to be drawn therefrom, in support of the verdict, the motion should be denied.' (Id. [Citation omitted].) As the Court must resolve all conflicts in the evidence and draw all reasonable inferences in support of the verdict, the Court cannot weigh the credibility of a witness. (Estes v. Eaton Corporation (2020) 51 Cal.App.5th 636, 651; Chodos v. Insurance Co. of North America (1981) 126 Cal.App.3d 86, 97.) '[T]he testimony of a single witness, even the party himself may' constitute 'substantial evidence.' (Chodos, supra, 126 Cal.App.3d at 97.) Defendant asserts the interpretation of the contract between Mr. Kormanis and inoSpine in which NuVasive was a third-party beneficiary is a matter of law this Court should decide, rather than the jury, because the contract is unambiguous.

The basic goal of contract interpretation is to give effect to the parties' mutual intent at the time of Calendar No.: Event ID: TENTATIVE RULINGS

3088651 61 CASE NUMBER: CASE TITLE: ALPHATEC SPINE INC VS NUVASIVE INC [E-FILE] 37-2017-00038583-CU-BC-CTL contracting. (Civ. Code, § 1636; Bank of the West v. Superior Court (1992) 2 Cal.4th 1254, 1264 [10 Cal.Rptr.2d 538, 833 P.2d 545].) When a contract is reduced to writing, the parties' intention is determined from the writing alone, if possible. (Civ. Code, § 1639.) 'The words of a contract are to be understood in their ordinary and popular sense.' (Civ. Code, § 1644; see also Lloyd's Underwriters v. Craig & Rush, Inc. (1994) 26 Cal.App.4th 1194, 1197-1198 [32 Cal.Rptr.2d 144] ['We interpret the intent and scope of the agreement by focusing on the usual and ordinary meaning of the language used and the circumstances under which the agreement was made'].) (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 955.) The principles concerning the interpretation of contracts are, of course, well settled. (1) Paramount among these rules are the following: the contract must be construed as a whole and the intention of the parties must be ascertained from the consideration of the entire contract, not some isolated portion (Civ.

Code, § 1641; Universal Sales Corp. v. Cal. etc. Mfg. Co. (1942) 20 Cal.2d 751, 760 [128 P.2d 665]; Stewart Title Co. v. Herbert (1970) 6 Cal.App.3d 957, 963 [96 Cal.Rptr. 631]); a contract entered into for the mutual benefit of the parties is to be interpreted so as to give effect to the main purpose of the contract and not to defeat the mutual objectives of the parties (Heidlebaugh v. Miller (1954) 126 Cal.App.2d 35, 38 [271 P.2d 557]; Bradner v. Vasquez (1951) 102 Cal.App.2d 338, 343–344 [227 P.2d 559]); language which is inconsistent with the objective of the contract shall be rejected (Civ. Code, § 1653; Jackson v. Puget Sound Lumber Co. (1898) 123 Cal. 97, 100 [55 P. 788]). (2) Also, where a contract is susceptible of two interpretations, the courts shall give it such a construction as will make it lawful, operative, definite, reasonable and capable of being carried into effect if it can be done without violating the intention of the parties (Civ. Code, §§ 1643, 3541; Rodriguez v. Barnett (1959) 52 Cal.2d 154, 160 [338 P.2d 907]; Dix Box Co. v. Stone (1966) 244 Cal.App.2d 69, 77 [52 Cal.Rptr. 847]). And last, but not least, the court shall avoid an interpretation which will make a contract extraordinary, harsh, unjust, inequitable or which would result in absurdity) Civ. Code, § 1638; Harris v. Klure (1962) 205 Cal.App.2d 574, 578 [23 Cal.Rptr. 313]; Straus v. North Hollywood Hosp., Inc. (1957) 150 Cal.App.2d 306, 311 [309 P.2d 541]; Pacific Tel. & Tel. Co. v. City of Lodi (1943) 58 Cal.App.2d 888, 892 [137 P.2d 847]).

(County of Marin v. Assessment Appeals Bd. (1976) 64 Cal.App.3d 319, 324–325 [Emphasis in original].) Parol evidence must be accepted where there is any ambiguity in the contract. (Wolf v. Superior Court (2004) 114 Cal.App.4th 1343, 1350–1351.) Where there are 'conflicting interpretations and any others supported by reasonable inferences from the evidence' the matter 'must be resolved by a trier of fact.' (See Byrne v. Laura (1997) 52 Cal.App.4th 1054, 1066.) The Court finds there are reasonable inferences from the evidence to support that the contract was intended to prohibit Mr. Kormanis from soliciting clients during Mr. Kormanis's employment, not just for two years after employment. Section 9 of the contract, titled 'Non-Solicitation,' provides: A. For a period of two (2) years following the last day of Employee's employment, Employee will not compete with Employer within the Employee's Territory, by, in a competitive capacity: (1) Soliciting or accepting business competitive to Employer from, or providing competing products and/or services to, any person or entity, from whom or which Employee accepted business on behalf of Employer or to whom or which Employee provided products and/or services on behalf of Employer during the one-year period preceding the last day of Employee's employment; or (2) Soliciting or accepting competing business from or providing competing products and/or services to, any person or entity from whom or which Employe personally solicited business on behalf of Employer during the three (3) month period immediately preceding the last day of Employee's employment.

B. It is the specific intent of the parties that Employee shall be restricted from soliciting or accepting Calendar No.: Event ID: TENTATIVE RULINGS

3088651 61 CASE NUMBER: CASE TITLE: ALPHATEC SPINE INC VS NUVASIVE INC [E-FILE] 37-2017-00038583-CU-BC-CTL competing business regarding the same or similar products and/or services as Employee sold or provided while employed by Employer or products or services that compete with the products and/or services as Employee sold and/or provided while employed by Employer.

(Trial Ex. 156.) Not only is it possible to reasonably interpret 9B as prohibiting Mr. Kormanis from soliciting during his employment based on the language itself, but the contract as a whole and the context lends support to such notion. While the recitals are not binding, they are relevant for ascertaining the intent of the parties.

(See Newby v. Anderson (1950) 36 Cal.2d 463, 470.) The recitals provide that Mr. Kormanis owed a duty of loyalty. A duty of loyalty and soliciting during employment are inconsistent. Further, Section 8 addresses the prohibition of competing during employment. It appears the parties intended that Mr.

Kormanis be prohibited from being disloyal, by way of competition and solicitation, during employment and for two years thereafter. Indeed, it would be odd for inoSpine to bargain for loyalty as to solicitation and competition for two years after employment, but not as to the period during employment.

Moreover, Defendant's reading of the contract would essentially render 9A redundant. 'We must also assume that the parties did not intend any of the language in the contract to be surplus, redundant, or to give rise to an absurd outcome.' (Filtzer v. Ernst (2022) 79 Cal.App.5th 579, 584.) Section 9A already prohibited solicitation as to a period after Mr. Kormanis's employment; therefore, section 9B would be redundant if it referred to that same period rather than during Mr. Kormanis's employment. The Court should avoid interpreting the contract to create such a redundancy.

In short, the motion is denied.

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