Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 1 of 47 1 JOANNA R. MENDOZA, (CaL. State Bar No. 148320) LAW OFFICES OF JOANNA R. MENDOZA, P.C. 2 P.O. Box 2593 Granite Bay, CA 95746 3 (916) 781-7600 (916) 781-7601 FAX 4 jmendoza(ftheiplawfirm.com 5 Attorneys for Plaintiffs THOMAS T. AOKI, M.D., and 6 AOKI DIABETES RESEARCH INSTITUTE 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 12 THOMAS T. AOKI, M.D., an individual, and AOKI DIABETES RESEARCH INSTITUTE, a California Non-Profit Corporation, Plaintiffs, 13 vs. 14 ) ) ) ) ) ) GREGORY FORD GILBERT, an individual; ) 15 BIONICA, INC., a Nevada corporation; ) BIONICA INT'L, LLC, a California limited ) 16 17 18 19 20 22 23 24 FIRST AMENDED COMPLAINT FOR: 1) 2) 3) 4) Patent Infringement Copyright Infringement Trade Secret Misappropriation False and Misleading liability company; TRINA HEALTH, LLC, a ) California limited liability company; TRINA ) HEALTH OF NEWPORT BEACH, LLC, a ) California limited liability company; DEEPAL ) CEMO MEDICAL SOLUTIONS, LLC, a ) 5) False and Misleading California limited liability company also doing ) 6) Breach of Fiduciary Duty THERAPY CENTERS; SAMMYF. CEMO, an) 7) Breach of Confidential Relationship individual; DEEP AL W ANNAKUW ATTE, an ) 8) Unfair Competition (Lanham business as AMERICAN DIABETES ) individual; HEALTH INOVATIONS, LP, a ) 21 CASE NO. 2:II-cv-02797-MCE-CKD ) California limited partnership; ACSRC, LLC, a ) Delaware limited liability company; GARY J. ) MUGG, an individual; SHUYUAN "SHERRY") TANG, an individual; MEDEDCO, LLC, an ) Arizona limited liability company; DIABETIC ) INOVATIONS, LLC, a Texas limited liability) company; MELANIE J. KUNZ, an individual; ) Advertising (Lanham Act - 15 USC §1125(a)(1)) Advertising (CaL. Bus. & Prof. Code §17500) Act - 15 USC §1125(a)) 9) Unfair Competition (CaL. Bus. & Prof. Code §17200) JURY TRIAL DEMANDED MICHAEL R. McCARTHY, an individual; ) 25 26 MARC R. ROSE, M.D., an individual; KEVIN ) J. BUCKMAN, M.D., an individual; and DOES) i - 50, inclusive, ) Defendants. 27 ) ) 28 i FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 2 of 47 Plaintiffs THOMAS T. AOKI, M.D., and AOKI DIABETES RESEARCH INSTITUTE 1 do hereby complain against the above-named defendants and allege as follows: 2 JURISDICTION AND VENUE 3 I. This is a Complaint for Patent Infringement arising under the patent laws of the 4 the United States Code), for Copyright Infringement arising under the United States (Title 35 of 5 copyrght laws of the United States Code), for Unfair Competition the United States (Title 17 of 6 the United and False and Misleading Advertising arising under the Lanham Act (Title iS of 7 States Code), and for related business torts and statutory violations including under common law 8 and California statutory law. 9 2. This Court has original and exclusive subject matter jurisdiction over this action, 10 without regard to the amount in controversy or the citizenship of the parties, pursuant to 28 11 U.S.c. §§ 1331, 1338(a) and (b). 12 3. This Court has supplemental jurisdiction over the remaining claims for relief, 13 the parties, under 28 U.S.C. without regard to the amount in controversy or the citizenship of 14 15 16 17 18 § 1367( a), because these claims arise out of the same set of facts and circumstances and form part of the same case or controversy. 4. Venue is proper in this Court pursuant to 28 U.S.c. §1391 because (i) one or more of the Defendants reside in the Eastern District of California; (2) a substantial part of the events giving rise to Plaintiffs claims occurred, and continue to occur, in this District; and (3) a 19 substantial part of 20 the Plaintiffs intellectual property which is the subject of situated in this District. 21 THE 22 24 25 PARTIES THOMAS T. AOKI, M.D. (hereinafter "Dr. Aoki") is an individual 5. Plaintiff 23 residing in Sacramento, California, and is a physician licensed to practice in the State of California. 6. Plaintiff AOKI DIABETES RESEARCH INSTITUTE (hereinafter "ADRI") is a 26 California non-profit medical research corporation with its principal place of 27 this action is business in Sacramento, California. 28 2 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 3 of 47 1 7. Defendant GREGORY FORD GILBERT (hereinafter "Gilbert") is an individual 2 residing in Sacramento County, California, and an attorney at law licensed to practice by the 3 State of California. Gilbert's principal place of business is located in McClellan, California, 4 where he operates as the founder and principal owner of defendants BIONICA, INC., BIONICA 5 INTERNATIONAL, LLC, TRINA HEALTH, LLC, and TRINA HEALTH OF NEWPORT 6 BEACH, LLC (together with numerous other non-defendant entities), acting as the sole officer, 7 director and controllng shareholder or member of those business entities. Upon information and 8 belief, Defendant Gilbert is also doing business under the fictitious names "Artificial Pancreas 9 Treatment Clinics," "diabetes.net," and "Diabetes Network." Upon further information and web 10 belief, defendant Gilbert participates in the operation and/or control of sites 11 ww.diabetes.net and www.stopdiabetesmd.com, and clinics located in Newport Beach, 12 California (hereinafter the "Newport Beach Clinic") and Sacramento, California (hereinafter the 13 "Sacramento Clinic"). 14 8. Defendant BIONICA, INC. is a Nevada corporation, registered to do business in 15 the State of California with its principal place of business in McClellan, California. Defendant 16 BIONICA INTERNATIONAL, LLC, is a California limited liability company with its principal 17 place of business in McClellan, California. These two defendants shall be referred to herein as 18 "Bionica." Upon information and belief, defendant Bionica operates and controls the website 19 ww.bionicainc.com. 20 9. Upon information and belief, defendant Bionica is, and at all times herein 21 mentioned was, a mere sham and shell, organized and operated as the alter ego of defendant 22 Gilbert for his personal benefit and advantage, and in an effort to avoid personal liability, in that: 23 a. Defendant Gilbert has at all times herein mentioned exercised total dominion 24 and control over defendant Bionica, and operated said company out of a single 25 location with multiple other alleged businesses owned and controlled by 26 defendant Gilbert; 27 b. Defendant Gilbert is the sole offcer, director and shareholder of defendant 28 Bionica; 3 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 4 of 47 c. Defendant Gilbert has so intermingled his personal and financial affairs and 1 2 alleged personal property with defendant Bionica, that it was, and is, the alter 3 ego of Gilbert; 4 d. Defendant Gilbert has failed to observe and comply with corporate formalities (as applicable) required by law; 5 6 e. Defendant Bionica is, and at all times herein mentioned was, so inadequately 7 capitalized that, compared with the business done by Bionica and the risk of 8 loss attendant thereon, its capitalization was illusory. 9 10. Adherence to the fiction of the separate existence of defendant Bionica as distinct the privileges provided by the 10 from defendant Gilbert would permit an injustice and an abuse of 11 entity structure and would sanction a fraud and promote injustice insofar as defendant Bionica is 12 found liable for the acts actually committed by defendant Gilbert, defendant Bionica was merely 13 a shield for such conduct. 14 11. Defendant TRINA HEALTH, LLC, (recently known as Cellular Activation 15 Therapy Clinics, LLC) (hereinafter "CATC") is a California limited liability company with its business in McClellan, California. Upon information and belief, defendant 16 principal place of the website www.diabetes.net. Upon 17 CATC participates in the operation and/or control of 18 further information and belief, defendant CATC, together with defendant Gilbert, operates and 19 controls the Sacramento Clinic. 20 12. Upon information and belief, defendant CATC is, and at all times herein 21 mentioned was, a mere sham and shell, organized and operated as the alter ego of defendant 22 Gilbert for his personal benefit and advantage, and in an effort to avoid personal liability, in that: 23 a. Defendant Gilbert has at all times herein mentioned exercised total dominion 24 and control over defendant CA TC, and operated said company out of a single 25 location with multiple other alleged businesses owned and controlled by 26 defendant Gilbert; 27 b. Defendant Gilbert is the sole member of defendant CATC; 28 c. Defendant Gilbert has so intermingled his personal and financial affairs and 4 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 5 of 47 1 alleged personal property with defendant CATC, that it was, and is, the alter 2 ego of Gilbert; d. Defendant Gilbert has failed to observe and comply with the statutory 3 formalities (as applicable) required by law; 4 5 e. Defendant CATC is, and at all times herein mentioned was, so inadequately 6 capitalized that, compared with the business done by CA TC and the risk of 7 loss attendant thereon, its capitalization was ilusory. 8 13. Adherence to the fiction of the separate existence of defendant CATC as distinct 9 from defendant Gilbert would permit an injustice and an abuse of the privileges provided by the 10 entity structure and would sanction a fraud and promote injustice insofar as defendant CATC is 11 found liable for the acts actually committed by defendant Gilbert, defendant CATC was merely a 12 shield for such conduct. 13 14. Defendant TRINA HEALTH OF NEWPORT BEACH (recently known as Costa 14 Mesa Cellular Activation Therapy Clinic, LLC, and hereinafter referred to as "CM CATC"), is a business in McClellan, California. 15 California limited liability company with its principal place of 16 Upon information and belief, defendant CM CATC, together with defendant Gilbert, operates 17 and controls the Newport Beach Clinic. 18 15. Upon information and belief, defendant CM CATC is, and at all times herein 19 mentioned was, a mere sham and shell, organized and operated as the alter ego of defendant 20 Gilbert for his personal benefit and advantage, and in an effort to avoid personal liability, in that: 21 a. Defendant Gilbert has at all times herein mentioned exercised total dominion 22 and control over defendant CM CATC, and operated said company out of a 23 single location with multiple other alleged businesses owned and controlled 24 by defendant Gilbert; 25 b. Defendant Gilbert is the sole member of defendant CM CATC; 26 c. Defendant Gilbert has intermingled his personal and financial affairs and 27 alleged personal property with defendant CM CATC; 28 d. Defendant Gilbert has failed to observe and comply with the statutory 5 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 6 of 47 formalities (as applicable) required by law; 1 e. Defendant CM CATC is, and at all times herein mentioned was, so 2 3 inadequately capitalized that, compared with the business done by CM CATC 4 and the risk of loss attendant thereon, its capitalization was ilusory. 5 16. Adherence to the fiction of the separate existence of defendant CM CATC as 6 distinct from defendant Gilbert would permit an injustice and an abuse of the privileges provided 7 by the entity strcture and would sanction a fraud and promote injustice insofar as defendant CM 8 CA TC is found liable for the acts actually committed by defendant Gilbert, defendant CM CATC 9 was merely a shield for such conduct. 10 17. Defendant DEEP AL CEMO MEDICAL SOLUTIONS, LLC, a California limited 11 liability company, also doing business under the fictitious name "American Diabetes Therapy 12 Centers" (hereinafter "ADTC"), and is a California limited liability company with its 13 administrative offices located in El Dorado Hils, California, and a clinic/treatment center located 14 in Rosevile, California (hereinafter the "Rosevile Clinic").. Upon information and belief, 15 ADTC operates and controls the websites ww.americandiabetestherapy.com. 16 ww.americandiabetestherapycenters.com, and www.diabetestherapycenters.com. 17 18. Defendant SAMMY F. CEMO (hereinafter "Cemo"), is an individual residing in 18 Orangevale, California, and is a member/manager of defendant ADTC. 19 19. Defendant DEEPAL WANNAKUWATTE (hereinafter "Deepal"), is an 20 individual residing in the Eastern District of California, and is a member/manager of defendant 21 ADTC. 22 20. Defendant HEALTH INOVATIONS, LP (hereinafter "HI"), is a California 23 limited partnership, with its principal place of business in Dublin, California. Upon information 24 and belief, defendant HI operates and controls the website ww.health-innovations.us and a 25 clinic in Hayward, California (hereinafter the "Hayward Clinic"). 26 21. Defendant ACSRC, LLC (hereinafter "ACSRC"), is a Delaware limited liability 27 company with its principal place of business in Dublin, California, and is the general partner of 28 defendant HI. 6 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 7 of 47 1 22. Defendant GARY J. MUGG (hereinafter ("Mugg"), is an individual residing in 2 Contra Costa County, California, and is an attorney at law licensed to practice by the State of 3 California. Defendant Mugg's principal place of business is located in Dublin, California, 4 where, upon information and belief, he operates as a principal of defendants HI and ACSRC and 5 the Hayward Clinic.. 6 23. Defendant SHUYUAN "SHERRY" TANG (hereinafter "Tang"), is an individual 7 who, upon information and belief is residing in Contra Costa County, California, and is an 8 attorney 9 of at law licensed to practice by the State of California. Defendant Tang's principal place business is located in Dublin, California, where, upon information and belief, she operates as a 10 principal of defendants HI and ACSRC and the Hayward Clinic. 11 24. Defendant MELANIE J. KUNZ (hereinafter "Kunz"), is an individual residing in 12 the State of Arizona. Upon information and belief, defendant Kunz is a licensed registered nurse 13 in Arizona, and during the period of January 10,2007, to November 30,2010, held a license as a 14 registered nurse in the State of California. 15 25. Defendant MEDEDCO, LLC (hereinafter "MedEdCo"), is an Arizona limited 16 liability company with its principal place of business in Arizona and a second offce in 17 Sacramento, California. Plaintiffs are informed and believe and thereon allege that defendant 18 MedEdCo' s controlling member is defendant Kunz. 19 26. Upon information and belief, defendant MedEdCo is, and at all times herein 20 mentioned was, a mere sham and shell, organized and operated as the alter ego of defendant 21 Kunz for her personal benefit and advantage in that: 22 a. Defendant Kunz has at all times herein mentioned exercised total dominion 23 and control over defendant MedEdCo, and operated said company out of her 24 personal residence; 25 b. Defendant Kunz is the controlling member of defendant MedEdCo; 26 c. Defendant Kunz has so intermingled her personal and financial affairs with 27 defendant MedEdCo, that it was, and is, the alter ego of defendant Kunz; 28 d. Defendant Kunz has failed to observe and comply with the statutory 7 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 8 of 47 formalities (as applicable) required by law; 1 e. Defendant MedEdCo is, and at all times herein mentioned was, so 2 3 inadequately capitalized that, compared with the business done by MedEdCo 4 and the risk ofloss attendant thereon, its capitalization was ilusory. 5 27. Adherence to the fiction of the separate existence of defendant MedEdCo as 6 distinct from Kunz would permit an injustice and an abuse of the privileges provided by the 7 entity structure and would sanction a fraud and promote injustice insofar as defendant MedEdCo 8 is found liable for the acts actually committed by defendant Kunz, defendant MedEdCo was 9 merely a shield for her conduct. 10 28. Defendant DIABETIC INOV A TIONS, LLC (hereinafter "DI"), is a Texas business in Sachse, Texas. Upon 11 limited liability company with its principal place of 12 information and belief, defendant DI operates and controls a clinic in Sachse, Texas (hereinafter 13 the "Texas Clinic"), and the website ww.diabeticinnovations.com.. as well as content placed on 14 the website ww.cphomes.us. Plaintiffs are further informed and believe that defendants Gilbert 15 and Kunz are both managing members of defendant DI. 16 29. Defendant MICHAEL R. McCARTHY (hereinafter "McCarthy"), is an individual 17 residing in Ontario, California, and doing business with defendant Rose under the fictitious name 18 "Diabetes Network." Upon information and belief, defendant McCarthy participates in the 19 operation and control of 20 30. the web sites ww.stopdiabetesmd.com and www.stopdiabetesmd.net. Defendant MARC R. ROSE, M.D. (hereinafter "Rose"), is an individual residing 21 in Costa Mesa, California, and is a physician licensed to practice in the State of California. Upon 22 information and belief, defendant Rose is doing business with defendant McCarthy under the 23 fictitious name "Diabetes Network" and participates in the operation and control ofthe website 24 ww.stopdiabetesmd.com and ww.stopdiabetesmd.net. 25 31. Defendant KEVIN J. BUCKMAN, M.D. (hereinafter "Buckman"), is an 26 individual residing in Stockton, California, and is a physician licensed to practice in the State of 27 California. Upon information and belief, defendant Buckman is the medical director for both the 28 Roseville Clinic and the Hayward Clinic and is further affliated with the Texas Clinic as 8 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 9 of 47 1 evidenced by a webinar which appears as a link on the Texas Clinic's website. 2 32. By Order ofthis Court on March 13,2012, the Plaintiffs substituted DOE 1 for 3 TIMOTHY TIGHT (hereinafter "Tight"), an individual, and DOE 2 for CHENG SHAO 4 (hereinafter "Shao"), an individual, with respect to all claims asserted herein with the exception 5 of the Sixth and Seventh Claim for Relief. Upon information and belief defendant TIGHT is an 6 offcer of defendant CATC (Trina Health, LLC), and directly associated with defendant Gilbert, 7 his entities, clinics and conduct alleged herein. Upon information and belief, defendant Shao is 8 the main investor for the Hayward Clinic and is an officer, partner, member and/or shareholder 9 of defendants ACSRC and/or HI, is associated with defendants Mugg and Tang, and is thereby 10 associated with the conduct alleged herein with respect to those defendants and the Hayward 11 Clinic. 12 33. By Order of this Court on September 28,2012, the Plaintiffs substituted DOE 3 13 for F AISING S. CHUI (hereinafter "Chui"), an individual residing in Santa Barbara, California; 14 DOE 4 for DIABETIC LIFE PULSE OF LOUISIANA, LLC, (hereinafter "DLP LA") a 15 Louisiana limited liability company with members/managers who are resident of the State of 16 California; DOE 5 for LIMI MANAGEMENT, INC. (hereinafter "Limi"), a corporation with its 17 principal place of business in Santa Barbara, California; DOE 6 for DIABETIC LIFE PULSE, 18 INC. (hereinafter "DLP"), a California corporation with its principal place of business in Santa 19 Barbara, California; DOE 7 for LIFE PULSE HEALTH, LLC (hereinafter "Life Pulse), a 20 California limited liability company with its principal place of business in Santa Barbara, 21 California; DOE 8 for JOHN D. MULLEN (hereinafter "Mullen"), an individual residing in 22 Santa Barbara, California; DOE 9 for GLENN A. WILSON (hereinafter "Wilson"), an individual 23 residing in Santa Barbara, California; DOE i 0 for RICHARD L. GIRARD (hereinafter 24 "Girard"), an individual residing in Santa Barbara, California; and DOE II for DAVID S. 25 BRADLEY (hereinafter "Bradley") an individual residing in Santa Barbara, California. These 26 Doe defendants were added with respect to all claims asserted herein with the exception of the 27 Sixth and Seventh Claim for Relief. 28 34. According to the State of Louisiana Secretary of State's certified Articles of 9 FIRST AL\1ENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 10 of 47 1 Organization for DLP LA dated May 2012, and effective at all relevant times herein, for this court's jurisdiction, defendant Chui, a California resident, is the organizer and a 2 purposes of 3 manager/officer ofDLP LA, and defendant Limi, a California corporation, is a 25% 4 member/owner ofDLP LA. Plaintiffs allege, upon information and belief, that together, 5 defendants DLP LA, Chui, and Limi, operate and control a clinic in Shreveport, Louisiana, 6 (hereinafter the "Shreveport Clinic"). Information about the Shreveport Clinic is found on the 7 ww.diabetes.net website. Upon information and belief defendant Chui is the individual who 8 provided significant funding for the Shreveport Clinic to open. 9 35. Upon further information and belief, plaintiffs alleged that defendant Chui is an business address in Santa 10 offcer of defendant DLP, which maintains the same principal place of 11 Barbara, California as defendant Limi. Plaintiffs allege upon information and belief that Limi. Plaintiffs allege that the controlling 12 defendant Chui is an officer and/or shareholder of 13 member of defendants DLP and Limi is Chui, that the entities were created as a mere sham and 14 shell, and were organized as the alter ego of defendant Chui for his personal benefit and 15 advantage to avoid personal liability. Adherence to the fiction of the separate existence of these 16 defendants would permit an injustice and promote fraud. 17 36. that defendants Mullen, Wilson, Plaintiffs further allege on information and belief 18 Girard and Butler are all member, managers and/or officers of defendant Life Pulse, which 19 operates and controls a website ww.1ifepulsehealth.com - and clinic based out of Santa 20 Barbara, California (hereinafter the "Santa Barbara Clinic"). Pursuant to the website for the 21 Santa Barbara Clinic, these defendants are directly associated with defendants Gilbert, CATC, Medical Offcer"). 22 and defendant Buckman (who is identified as the Clinic's "Chief 23 37. The true names, capacities and identities of defendants sued herein and under the 24 fictitious names of DOES 12 through 50, inclusive, whether individual, corporate or otherwise, 25 are unkown to plaintiffs at this time, and plaintiffs wil amend this complaint by inserting the 26 true names of said defendants when said true names and identities are ascertained. Plaintiffs are 27 informed and believe, and based on said information and belief, allege thereon that each of the 28 defendants designated herein as DOES 12 through 50, inclusive, is legally responsible in some 10 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 11 of 47 1 manner for the events and happenings herein referred to, and all of plaintiffs' injuries and 2 damages as herein alleged were proximately caused by said defendants. 3 38. Plaintiffs are further informed and believe and thereon allege that at all times the defendants was acting as agent, employee, servant, partner, and/or 4 herein mentioned, each of 5 joint venturer of herein were done the remaining defendants, and all the acts complained of 6 within the course and scope of said agency, employment, servitude, partnership and/or joint 7 venture, and that all acts alleged herein committed by each defendant were ratified and approved the 8 by the remaining defendants and/or done with the knowledge, consent and permission of 9 other defendants. 10 FACTUAL BACKGROUND COMMON TO ALL CLAIMS 11 The Technology at Issue - The Aoki Patents and Related Know-How 12 39. Plaintiff Dr. Aoki is a world-renowned expert in endocrinology, diabetes and 13 metabolism. He is the former head of Metabolism Research at Joslin Diabetes Center in Boston, California, Davis, School of 14 Massachusetts, and a current Professor Emeritus at the University of 15 Medicine. Dr. Aoki and his ground-breaking work in this specialized field of medicine is the 16 foundation upon which ADRI was created. 17 40. ADRI was founded in 1986 by plaintiff Dr. Aoki to further his research efforts in 18 the areas of diabetes and metabolism. ADRI also provides clinical care for patients with 19 metabolic disorders, including treatment of patients with a type of intravenous insulin therapy 20 called metabolic activation therapy or MAT(ß treatment. Research conducted by Dr. Aoki and 21 ADRI includes basic science laboratory investigations and observational studies of clinical 22 outcomes. While some of ADRI's patients receive the MAT(ß treatment as part of enrolled 23 research studies, patients are also referred to ADRI for MAT(ß treatments when they have 24 progressive diabetic complications despite standard intensive therapy recommended by the 25 American Diabetes Association. 26 41. the MAT(ß treatment, in May 1989, Dr. As the sole inventor and developer of 27 Aoki received a patent from the United States Patent and Trademark Offce for the original 28 MAT(ß treatment - U.S. Patent No. 4,826,810 (hereinafter "810 Patent"), titled "System and II FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 12 of 47 1 method for treating animal body tissues to improve the dietary fuel processing capabilities 2 thereof." The system involved administering a dietary fuel of a preselected type and quantity to 3 the subject to produce in the blood supply to the predetermined body tissues a substantially 4 elevated carbohydrate concentration during a time following such administration. During at least 5 a portion ofthat time period of elevated carbohydrate concentration, insulin is injected into the 6 subject in accordance with a prearranged insulin concentration versus time function. The insulin 7 injection function produces a rapid increase in the free insulin concentration in the blood supply 8 to the involved body tissues and is preferably a prearranged series of spaced insulin pulses that 9 produce a series of peaks in the free insulin concentration in the blood supply to the target tissues 10 and a continuously rising interpeak value of free insulin concentration. What results therefrom 11 these effects is a functional improvement in the dietary fuel processing capability of the involved 12 body tissues. A computer controlled insulin pumping system functions under a program control 13 to provide a series of insulin pulses. Included within the patent claims are ranges for the insulin 14 used and frequency of 15 42. the pulses. During the development of the 810 Patent and continuing thereafter, Dr. Aoki and 16 ADRI developed trade secret know-how related to the use and application of the invention set 17 forth in the 810 Patent. 18 43. Administration of the 8 i 0 Patent system and method on human patients was 19 intended to only be administered and closely supervised by physicians who received specialized 20 training from ADRI or by ADRI trained medical professionals operating under the immediate 21 supervision of ADRI trained physicians. If not properly administered, iv insulin may cause 22 death or severe injury to the patient. 23 44. Subsequent to his work on the 810 Patent, Dr. Aoki began developing methods 24 and systems which, using a similar form of pulsatile intravenous insulin, were designed in a 25 manner to treat major diseases suffered by both diabetic and non-diabetic patients. These 26 developments are covered by patents and trade secret know-how associated with the optimal 27 application of the methods on patients seeking the treatment. 28 45. The U.S. Patents at issue in this action are as follows: 12 FIRST AMENDED COMPLAINT FOR PATENT INFRIGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 13 of 47 1 a. US Patent No. 6,579,53 i ("531" Patent) is described as a "Method for treating 2 heart disease and cardiovascular disease in diabetic and non-diabetic patients" 3 and was issued on June 17, 2003. More specifically, the invention is a system 4 and method using intermittent insulin pulses intravenously to achieve an 5 increase in dietary fuel capabilities and to correct an overutilization of free 6 fatty acids associated with heart disease and cardiovascular disease. 7 b. US Patent No. 6,582,716 ("716" Patent) is described as a "Method for treating 8 wounds, promoting healing and avoiding amputations in diabetic and non- 9 diabetic patients" and was issued on June 24, 2003. More specifically, the 10 invention is a system and method using intermittent insulin pulses 11 intravenously to achieve an increase in glucose oxidation in tissues 12 surrounding an affected area, therefore treating wounds, promoting healing 13 and avoiding amputations. 14 c. US Patent No. 6,613,342 ("342" Patent) is described as a "System and method 15 for treating kidney diseases in diabetic and non-diabetic patients" and was 16 issued on September 2,2003. More specifically, the invention is a method 17 using intermittent insulin pulses intravenously to achieve the slowing, 18 stopping or reversing of kidney disease. 19 d. US Patent No. 6,613,736 ("736" Patent) is described as a "System and method 20 for treating eye and nerve diseases in diabetic and non-diabetic patients" and 21 was issued on September 2, 2003. More specifically, the invention is a 22 method using intermittent insulin pulses intravenously to achieve an increase 23 in retinal and neural glucose oxidation by enhancing pyruvate dehydrogenase 24 activity and, therefore, treating retinopathy and central nervous system 25 disorders. 26 e. US Patent No. 6,82 I ,527 ("527" Patent) is described as a "System for treating 27 kidney disease in diabetic and non-diabetic patients" and was issued on 28 November 23,2004. More specifically, the invention is a system using 13 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 14 of 47 1 intermittent insulin pulses intravenously to achieve the slowing stopping or 2 reversing of kidney disease. f. US Patent No. 6,967,191 ("191" Patent) is described as a "System for treating 3 4 eye and nerve diseases in diabetic and non-diabetic patients" and was issued 5 on November 22,2005. More specifically, the invention is a system using 6 intermittent insulin pulses intravenously to achieve an increase in retinal and 7 neural glucose oxidation by enhancing pyrvate dehydrogenase activity 8 therefore, treating retinopathy and central nervous system disorders. and, g. US Patent No. 7,682,351 ("351" Patent) is described as a "Method for 9 10 improving hepatic glucose processing in diabetic and non-diabetic patients" 11 and was issued on March 23, 20 10. More specifically, the invention is a 12 method which delivers a series of insulin pulses to the subject over a period of 13 time accompanied by ingestion of glucose in the form of a carbohydrate 14 containing meaL. The amount of insulin in each pulse, the interval between 15 pulses and the amount of 16 so that the hepatic processing of glucose is restored in the subject, together 17 with a subsequent fall in circulating blood glucose levels of 18 directly as a result of improved hepatic glucose processing. 19 46. time to deliver each pulse to the subject are selected 50 mg/dl or more Collectively, the patents identified hereinabove (a through g) shall be referred to 20 herein as "the Patents," and called Metabolic Activation Therapy when the trade secret know21 how associated with the administration of the Patents is included (hereinafter collectively 22 referred to as "MAT(ß" - a registered trademark owned by plaintiff Dr. Aoki). 23 ADRI 's License to Use the MAT(ß Treatment 24 47. Dr. Aoki has provided plaintiff ADRI with a non-exclusive, non-transferable 25 royalty- free license to use, practice and otherwise perform the claims asserted in the Patents, 26 together with all know-how related thereto, including any procedure which incorporates or uses 27 any aspect of that technology, for clinical and research purposes, within the United States. 28 Plaintiff ADRI has no right to sublicense to others. In addition, under the terms and conditions 14 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 15 of 47 1 of the license, plaintiff ADRI maintains the right to prosecute any action for infringement against 2 any third party infringer, including the ability to seek recovery of all losses, costs, damages or 3 expenses, including attorneys' fees incurred as a result of said infringement. It is under the terms 4 of this license agreement that plaintiff ADRI asserts standing to prosecute the claims for patent 5 infringement asserted herein. 6 48. Plaintiff Dr. Aoki does not currently provide a license to use his Patents in the 7 United States to any other person or firm except ADRI. 8 Defendant Gilbert's Early Involvement with Dr. Aoki and ADRI 9 49. Over the course of several years, defendant Gilbert was retained by and acted as 10 the personal attorney for plaintiff Dr. Aoki. During that same period, defendant Gilbert became 11 engaged in business transactions with his client, Dr. Aoki, including setting up legal entities to 12 exploit Dr. Aoki's technology - entities in which defendant Gilbert would appoint himself as a 13 director and offcer. Once defendant Gilbert set up the legal entities for Dr. Aoki, he would then 14 also act as legal counsel to the entities, including plaintiff ADRI. In that capacity defendant 15 Gilbert drafted nearly every legal document for those entities and Dr. Aoki, and he provided 16 legal advice to both plaintiffs until the relationship came to a bitter end in late 2002/early 2003. 17 50. The end of the relationship between defendant Gilbert, Dr. Aoki and ADRI 18 occurred after the plaintiffs learned that defendant Gilbert had "used" corporate funds without 19 permission in 2002 to purchase, for Gilbert's own benefit, the trade name, pumps and parts from 20 an Australian company named Bionica. Thus, defendant Gilbert acquired the rights to the 21 Bionica pump and name (for which he later would take sole credit for developing). At the time 22 that defendant Gilbert acquired the Bionica rights and created a legal entity for his own benefit 23 (defendant Bionica), the Bionica pump had been used, in the patents, as an example of one of the 24 many infusion pumps that could be used for the MAT(ß treatment. It has never been the only 25 infusion pump available to use with the Patents, and the Bionica pump is not and never has been 26 part of the technology covered by the Patents. 27 51. During the period in which defendant Gilbert acted as legal counsel to Dr. Aoki 28 and ADRI, as well as his role as an officer and director of ADRI, he had a confidential and 15 FIRST AMENDED COMPLAINT FOR PATENT INFRIGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 16 of 47 1 fiduciary relationship during which he acquired a significant amount of confidential information 2 which was disclosed to him with the mutual understanding that the information was being 3 disclosed in confidence and that the confidence be maintained. Not only was defendant Gilbert 4 provided confidential business information, he was made aware of certain "know how" and trade 5 secrets associated with the protocols used with the Patents. The plaintiffs have never waived these matters, nor have they provided permission to 6 their rights to assert the confidentiality of 7 defendant Gilbert to disclose said information to others not under a similar duty of 8 confidentiality with Dr. Aoki and ADRI. 9 Defendant Gilbert Infringes His Clients' IP Rights by Engaging Defendants to Compete 10 52. Upon information and belief, after the relationship between defendant Gilbert and 11 the plaintiffs was terminated, defendant Gilbert began to engage in conduct designed to harm the 12 plaintiffs and benefit himself by falsely asserting that Gilbert, Bionica and/or CATC held all 13 right, title and interest in the MA T(ß treatment. 14 53. Upon information and belief, at the time that defendant Gilbert's relationship with 15 the plaintiffs was terminated by the plaintiffs, defendant Kunz was involved in a personal 16 relationship with defendant Gilbert. It was through that personal relationship that defendant 17 Kunz became familiar with the MATCI treatment. In or about 2002, and under an obligation of 18 confidentiality, defendant Kunz (a registered nurse in Arzona and California) received 19 incomplete and limited training by the plaintiffs with respect to treating patients with MAT(ß 20 treatment under the supervision of a physician. Defendant Kunz did not receive all the necessary 21 training because she failed to participate fully. 22 54. Despite her lack of complete training in the use ofMATCI treatment, and upon 23 information and belief, in 2004 defendant Kunz founded defendant MedEdCo specifically for the 24 purpose of providing "clinical support services" to assist defendants Gilbert, Bionica and CATC 25 in setting up clinics to offer the MA T(ß treatment. Upon further information and belief, Kunz, 26 purported to provide "professional" training to physicians, clinical oversight, medical advisory 27 board support, patient education, and quality assurance services for the clinics that Gilbert and 28 his entities would convince others to open up. However, defendant Kunz was not, and never has 16 FIRST ALi\ENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 17 of 47 1 been, qualified to train anyone, let alone physicians, with respect to treating patients with the 2 MA T(I treatment. 3 55. Thus, upon information and belief, the only person identified as providing these 4 training and clinical services to the clinics owned and operated by the other defendants has never the defendants 5 been sufficiently qualifed to do so, resulting in wholly inadequate: (a) training of 6 and their agents, employees and those acting in concert with them at the clinics, (b) 7 understanding of the treatment and possibility of adverse consequences which have been and can 8 be suffered by the patients as a result of how the MAT(ß treatment is applied; and (c) safety 9 measures which should be engaged during the MA T(ß treatment. This creates an unacceptable 10 risk to the general public and any patients who may seek treatment at the defendants' clinics. 11 56. With defendants Kunz and MedEdCo set up to assist him in his scheme to use his 12 former clients' technology in violation of 13 California law, and in violation of his obligations and duties as an attorney under his ongoing fiduciary duties as a former offcer and director of 14 ADRI, defendant Gilbert/Bionica/CATC acted in concert with the remaining defendants to set up 15 clinics where the MA T(ß treatment would be offered to patients suffering from serious health 16 complications (in other words, preying upon some of the weakest and most desperate 17 individuals in our society), using false and misleading statements regarding the status and 18 efficacy of the treatment in order to give the patients false hope, and making false promises that 19 those patients would receive insurance and/or MediCare coverage to pay for the treatment. 20 57. Defendant Gilbert's website, ww.diabetes.net. is the "hub" website which ties 21 together the clinics operating (or being set up or planned) in Rosevile, Sacramento, Hayward, 22 Newport Beach, Texas, Louisiana, Florida, North Carolina, New York, Hong Kong, Mexico and 23 South Afrca. The website even has a page for the clinics with respect to buying supplies and 24 equipment through defendant Gilbert. Defendant Gilbert, and the entities he has created for his 25 benefit (and as an attempt to avoid liability for his knowing and intentional conduct), uses his 26 website ww.diabetes.net to distribute false and misleading information about the MA T(ß 27 treatment. The misinformation disseminated by defendant Gilbert on that website includes, but 28 is not limited to, the following examples: (a) statements whereby defendant Gilbert himself 17 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 18 of 47 1 takes full credit for developing the MAT(ß treatment rather than Dr. Aoki; (b) statements 2 whereby defendant Gilbert himself takes full credit for developing the Bionica infusion pump 3 which he purchased IÌ"om an Australian company that built the device; (c) referring to the MA T(I 4 treatment as "Arificial Pancreas" System or Therapy, and falsely stating that it is FDA approved 5 and that it mimics a normal pancreas with respect to insulin secretion; (d) stating that there has 6 been over 100,000 treatments using the technology, which is a gross exaggeration; (e) falsely 7 stating that there has never been an adverse reaction; (f) falsely stating that there has never been 8 a pump failure; (g) stating that the treatment works on patients with Type 2 diabetes when there 9 is no scientific data to support that statement; (h) posting a diagram representing "proper" human 10 metabolism which is, in actuality, a diagram of biochemical pathways for worms, not people; (i) 11 stating that the treatment results in normalized carbohydrate and lipid metabolism when it does 12 not do so; (j) stating that the treatment stops the complications of diabetes when it does not, it 13 slows down the complications; (k) making statements of "fact" and certainty about how the 14 treatment impacts complications associated with diabetes without any data to support those 15 claims; and (1) referrng to the clinical research results and trial information as data and 16 information created and owned by defendant Gilbert. 17 58. Documents linked to the website ww.diabetes.netinclude a presentation that 18 borrows significantly from content generated by Dr. Aoki, which was provided to defendant 19 Gilbert for his personal use only, and which was to be maintained as confidentiaL. 20 59. Upon information and belief, defendant Gilbert's expressed goal is to make the 21 MAT(ß treatment available to "anyone and everyone who needs the treatment" and, in order to 22 do this, new clinics are being opened as quickly as funding can be obtained. Thus, defendant 23 Gilbert has made it clear that he intends to continue to use the Patents of Dr. Aoki, along with the 24 know-how and trade secrets for optimizing the treatment, to the fullest extent possible, despite 25 having no authority to do so, unless and until he is stopped by a court oflaw. 26 The Rosevile Clinic is Opened 27 60. The plaintiffs are informed and believe and on that basis allege that the clinic 28 offering MA T(ß treatment in Rosevile, California, is operated by defendants ADTC, Cemo and 18 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 19 of 47 1 Deepal, with participation of and assistance from defendants Gilbert, Bionica, CATC, Kunz, 2 MedEdCo, and Buckman. Upon information and belief, the Rosevile Clinic first began 3 providing services to patients on or about July 2010, offering plaintiffs' proprietary MAT(ß 4 treatment under the misleading moniker "Artificial Pancreas Therapy." 5 61. The plaintiffs are further informed and believe, and on that basis allege, that on or 6 about July 29,2010, and August 18,2010, defendants Gilbert and ADTC put on presentations at 7 Lincoln Hills Sun City in Lincoln, California promoting the MAT(ß treatment which was being 8 offered at the Rosevile Clinic. At these presentations, defendant Gilbert falsely advertised to 9 those present that he developed the MA T(ß procedure, that the treatment "normalizes the 10 metabolism" of diabetics, that he and his associates were "the healing people of the world" and 11 that his proprietary treatment "improves everything in his diabetic patients." 12 62. Information distributed by defendants Gilbert and ADTC at the Sun City 13 presentations acknowledge that the Roseville Clinic is using the Patents to provide the treatment 14 to patients. The documentation falsely claims that there has never been an adverse reaction to 15 the treatment (there are adverse reactions that have occurred), that the treatment is "completely 16 safe" (it can result in death if not performed correctly), that it stops and in many cases reverses 17 the complications of diabetes (it does not), and that Type 2 diabetics respond to the treatment (no 18 peer reviewed data is provided to support this claim). The documentation directed those present 19 to the website operated by defendant Gilbert, www.diabetes.net. for additional information. 20 63. Upon further information and belief, defendant ADTC made another such 21 presentation on or about September 7, 2011, at Eskaton Rosevile Manor in Roseville, California, 22 making the same or similar misrepresentations of fact and misleading statements. 23 64. The website for the Rosevile Clinic, www.americandiabetestherapy.com. 24 establishes the involvement of ADTC, Cemo, Deepal, Gilbert/Bionica/CA TC, Kunz/MedEdCo, 25 and Bucknian in the opening and operation of the Roseville Clinic. 26 65. Upon information and belief, defendant Buckman resides and practices medicine 27 in or near Stockton, California. He is identified on ADTC's website as an advisor and "Medical 28 Director" for the Rosevile Clinic, thereby indicating that he has a management role with ADTC 19 FIRST AL\1ENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 20 of 47 1 and is an active participant in the wilful infringement of the MAT(ß treatment. It is not 2 believed, however, that defendant Buckman supervises or treats patients with MAT(ß treatment 3 at the Roseville Clinic -- he merely takes responsibility for that treatment. Defendant Buckman 4 has never received proper and complete training in the MAT~ treatment by plaintiffs. 5 Defendant Buckman's biographical information on the ADTC website implies that he received 6 his medical degree from USC and that he has written over ten patents for new medical and 7 environmental technologies both of which are false and misleading. Defendant Buckman 8 received his medical degree from the Autonomous University of Guadalajara Faculty of 9 Medicine, and his name appears as an inventor on only one U.S. patent in either medical or 10 environmental technologies. 11 66. that defendant ADTC's website Plaintiffs allege on information and belief 12 contains many other false and misleading statements including, but not limited to, the following: 13 (a) defendant Kunz "has more clinical experience in (MAT~J protocol development than any the patents for the Bionica pump used 14 other practitioner;" (b) defendant Gilbert is the "owner of 15 in the treatment" insofar as (i) the Bionica patent in question expired in 1994 before Bionica was 16 acquired by Gilbert, and (ii) a more recent pump patent fied by Gilbert expired in 2011 and was 17 never made or used by anyone; (c) defendant ADTC has an exclusive sublicense to the MAT(ß the patented protocols for the MAT(ß 18 treatment; (d) defendant Gilbert/ CATC is the owner of 19 treatment; (e) MAT(ß treatment stops secondary complications of diabetes and reverses them in 20 most cases; (f) MAT(ß treatment and the Bionica Pump have been around for 20+ years and 21 performed over 100,000 treatments, and suggesting that all treatments have been perfonned 22 using the Bionica pump; and (g) defendants CATC and Bionica (aka Gilbert) take credit for 23 treatments performed by others. 24 67. Upon information and belief, defendant ADTC's expressed goal is to provide 25 many treatment centers for the MA T(ß treatment in order to treat as many diabetic people as 26 possible. Thus, the defendants associated with the Rosevile Clinic have made it clear that they 27 intend to continue to use the Patents of Dr. Aoki, without permission to do so, to the fullest 28 extent possible unless and until they are stopped by a court of law. 20 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 21 of 47 1 68. Upon further information and belief, the Rosevile Clinic is engaging in the 2 corporate practice of medicine in violation of California Business & Professions Code §2400 et 3 seq. and operating a clinic without first being licensed to do so in violation of California Health 4 and Safety Code § 1205. 5 The Hayward Clinic is Opened 6 69. The plaintiffs are informed and believe and on that basis allege that the clinic 7 offering MAT(ß treatment in Hayward, California, is operated by defendants HI, ACSRC, Mugg 8 and Tang, with participation of and assistance from defendants Gilbert, Bionica, CATC, Kunz, 9 MedEdCo, and Buckman. Upon information and belief, the Hayward Clinic first began 10 providing services to patients on or about May of201 I, offering plaintiffs' proprietary MAT(ß 11 treatment under the misleading moniker "Artificial Pancreas Therapy." 12 70. Upon information and belief, defendant Buckman is the "Medical Director" of the 13 Hayward Clinic, thereby indicating that he has a management role with the Hayward Clinic and the MAT(ß treatment. The Hayward Clinic 14 is an active participant in the wilful infringement of 15 is staffed by a Nurse Practitioner or a Physician Assistant, who are themselves managed by 16 defendant Buckman in his capacity of Medical Director operating from his practice in Stockton, 17 California. It is believed that defendant Buckman is not present at the Hayward Clinic when 18 patients are treated 19 71. For the benefit of the Hayward Clinic, and attached as a link to its website (which 20 also contains false and misleading statements about the effcacy and safety ofMAT(ß treatment), 21 defendant Buckman's name appears as the author ofa paper entitled "The Artificial Pancreas 22 System: A Medical Review of the Literature and Unpublished Data - Diabetes Mellitus and the 23 Role ofthe Artificial Pancreas System. That document contains many false and misleading 24 statements designed to suggest a level of safety and effcacy of MA T(ß treatment that is not 25 supported by clinical trials or data - all for the purpose of encouraging individuals with chronic 26 disease to seek treatment from the defendants in order to increase their profits and income. In 27 the document authored by defendant Buckman, plaintiffs are informed and belief and thereon 28 allege that defendant Buckman has changed the language used in describing scientific 21 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 22 of 47 1 conclusions or questions raised, all to transform scientific material into a false and misleading 2 publication designed to confuse and/or mislead the general public. 3 72. Also on the Hayward Clinic's website, defendant Buckman presents a "webinar" 4 attached as a link. During that webinar, defendant Buckman and the written presentation sites of defendant 5 together repeat many of the false and misleading statements found on the web 6 Gilbert and the Rosevile Clinic. 7 73. The website for the Hayward clinic provides that a purpose of defendant HI is to 8 deliver clinical facilities and support to professionals in order to assist in the treatment of patients 9 with diabetes using the MAT(ß treatment. Thus, the defendants associated with the Hayward Dr. Aoki, without 10 Clinic have made it clear that they intend to continue to use the Patents of 11 permission to do so, to the fullest extent possible unless and until they are stopped by a court of 12 law. 13 74. Upon further information and belief, the Hayward Clinic is engaging in the 14 corporate practice of medicine in violation of California Business & Professions Code §2400 et 15 seq. and operating a clinic without first being licensed to do so in violation of California Health 16 and Safety Code §1205. 17 The Costa Mesa Clinic is Opened 18 75. The plaintiffs are informed and believe and on that basis allege that the clinic 19 offering MAT(ß treatment in Costa Mesa, California, is operated by defendants McCarthy and 20 Rose, with participation of and assistance provided by defendants Gilbert, Bionica, CA TC, Kunz 21 and MedEdCo. Upon information and belief, the Costa Mesa Clinic first began providing 22 services to patients on or about June of 20 i i, offering plaintiffs' proprietary MA T(ß treatment 23 under the name Cellular Activation Therapy ("CAT"). 24 76. The website operated by defendant Rose and McCarthy in several respects copies 25 wholesale from the content which currently is or previously was found on defendant Gilbert's 26 website ww.diabetes.net. It duplicates many of the false and misleading statements contained 27 in defendant Gilbert's website, and the presentation material created and provided by Dr. Aoki in 28 confidence to defendant Gilbert is also attached to this website without permission from Dr. 22 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 23 of 47 1 Aoki. Some of the more disturbing misrepresentations made on defendant McCarthy's and 2 Rose's website is the assertion that the patient wil be able to be reimbursed through MediCare 3 and/or their health insurance company -- a fact known by the defendants to be false. 4 77. The website for the Costa Mesa clinic provides that a purpose of defendants Rose 5 and McCarthy is to make MA T(ß treatment available to those who need it, thereby requiring the 6 defendants to assist others to open clinics that wil perform the MA T(ß treatment. Thus, 7 defendants Rose and McCarthy have made it clear that they intend to continue to use the Patents 8 of Dr. Aoki, without permission to do so, to the fullest extent possible unless and until they are 9 stopped by a court of law. 10 78. Upon further information and belief, the Costa Mesa Clinic is being operated 11 without first being licensed to do so in violation of California Health and Safety Code § 1205. 12 The Newport Beach and Sacramento Clinics are Opened 13 79. The plaintiffs are informed and believe and on that basis allege that the clinics 14 offering MAT(ß treatment in Newport Beach and Sacramento, California, are operated directly 15 by defendant Gilbert and/or his entities Bionica, CATC and/or CM CATC, with the participation 16 of and assistance provided by defendant Kunz and MedEdCo. Upon information and belief, the 17 Newport Beach Clinic first began providing services to patients on or about September or 18 October 20 II. Upon information and belief, the Sacramento Clinic first began providing 19 services to patients on or about late 2012 or early 2013. Both offer plaintiffs' proprietary MAT(I 20 treatment under the misleading moniker "Artificial Pancreas Therapy." The only website 21 affiliated with these clinics is defendant Gilbert's ww.diabetes.net. 22 80. On or around July 18,2011, defendant Gilbert had advertising for the Nevvport 23 Beach Clinic published in the Orange County Business Journal. In that advertising defendant 24 Gilbert falsely credits himself with "the most important advancement in diabetes since insulin." 25 Defendant Gilbert also falsely credits himself with the design for the Bionica pump, and that 26 "his" design mimics the pancreas (it does not). He further gives himself credit for starting with 27 nothing and carring the project through regulatory approvals and clinical trials at a cost of over 28 $40 milion, all the way through final development, FDA approval (the treatment has not been 23 FIRST AL\1ENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 24 of 47 1 approved by the FDA) and now commercialization by clinics. Defendant Gilbert states in that which 2 advertisement that 100,000 treatments have occurred with no adverse reactions - both of 3 are false. 4 81. Upon further information and belief, the both the Newport Beach Clinic and the 5 Sacramento Clinic are engaging in the corporate practice of medicine in violation of California 6 Business & Professions Code §2400 et seq. and operating a clinic without first being licensed to 7 do so in violation of California Health and Safety Code §1205. 8 The Sachse, Texas Clinic is Opened 9 82. The plaintiffs are informed and believe and on that basis allege that a clinic 10 offering MAT(ß treatment in or near Sachse, Texas, has been opened directly by defendants DI, 11 Gilbert, and Kunz with participation by Bionica, CATC and MedEdCo to the extent those 12 entities are separate and distinct from defendants Gilbert and Kunz, if at alL. 13 83. The website affliated with the Texas Clinic, ww.diabeticinnovations.com. sites of 14 contains multiple false and misleading statements which are similarly found on the web 15 defendant Gilbert and the other clinics. The Texas Clinic's website also has a linked "webinar" 16 presented by defendant Buckman. During that webinar, defendant Buckman and the written 17 presentation together repeat many of the same false and misleading statements. 18 84. The plaintiffs are further informed and believe that the defendants affiiated with 19 the Texas Clinic are responsible for providing the identical false and misleading material to be 20 presented on the website ww.cphomes.us a website created to offer investment opportunities 21 to non-U.S. citizens (and more paiiicularly targeting Chinese citizens) that allegedly provide the 22 investor with an opportunity to obtain a green card under the EB-5 visa program. Thus, these 23 defendants are encouraging non-U.S. citizens to invest $500,000 in a clinic that, when operating, 24 wil violate multiple state and federal laws, simply for the purpose of obtaining a green card. 25 85. Upon further information and belief, and in addition to offering MAT(ß treatment 26 at the Texas Clinic, defendants DI, Gilbert (Bionica/CATC), Kunz (MedEdCo) offer their 27 "management services" to set up third-party investors with a clinic that offers the MAT(ß 28 treatment, including staffing assistance and training, billing support, managed care contract 24 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 25 of 47 1 support, clinical oversight and management, patient referral services and local/national 2 marketing defendant DI's expressed goal is to provide the MAT(ß treatment to milions of 3 diabetics and build as many clinics necessary to serve them. Thus, the defendants associated 4 with the Texas Clinic have made it clear that they intend to continue to use the Patents of Dr. 5 Aoki, without permission to do so, to the fullest extent possible unless and until they are stopped 6 by a court oflaw. 7 The Shreveport Clinic is Opened 8 86. The plaintiffs are informed and believe and on that basis allege that the 9 Shreveport Clinic, and the defendants affiliated with that clinic as alleged above, was opened 10 with the participation and assistance provided by defendants Gilbert, Bionica, CATC, Kunz and 11 MedEdCo. Upon information and belief, the Shreveport Clinic first began providing services to 12 patients during the spring or summer of2012, offering the plaintiffs' proprietary MATCI 13 treatment under the name Arificial Pancreas Therapy. 14 87. The plaintiffs are further informed and believe that the Shreveport Clinic 15 defendants have not created their own website but operate only through defendant Gilbert and 16 CATC's website, ww.diabetes.net. relying upon the misleading and untruthful statements 17 contained therein. In addition thereto, the Shreveport Clinic has engaged in a marketing 18 campaign since it has been in business, including website marketing in the Shreveport News 19 online and through radio programming available through live online streaming, which contain 20 much of the false and misleading content found on defendant Gilbert's website 21 ww.diabetes.net. including the false statements regarding reimbursement through MediCare 22 and health insurance companies -- a fact known by the defendants to be false. They also falsely 23 claim that the treatment is FDA approved, that it stops and reverses the complications of 24 diabetes, there has never been a negative reaction or side effect from MATCI, and that all patients 25 improve regardless of age, or length/degree of diabetic disease. On behalf of the Shreveport 26 Clinic, on September 22,2012, defendant Gilbert, when taking credit for what he calls "my 27 invention" and falsely taking credit for the clinical trials that were perfornied ("our clinical trials 28 have included Mayo, Scripps, Harvard which is Joslin, University of Arizona, Temple.. .We 25 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 26 of 47 1 have 14 published clinical trials") when describing MA TII, has described how it works on 2 diabetic foot sores as "almost a miracle" and with respect to metabolism in general that MATII 3 wil give a "97 year old" patient "the metabolism of an 18 year old." Defendant Gilbert also 4 stated that "we are getting paid by Medicare, we're getting, being paid by insurance absolutely." Defendant Gilbert and the Shreveport Clinic defendants, however, 5 companies.. . 6 know this to be false and continue to assert it without fail or hesitation. 7 88. It was during this same radio interview when defendant Gilbert was making the 8 above-referenced false statements, on September 22,2012, when defendant Gilbert, on behalf of 9 the Shreveport Clinic defendants, together with Susan Posey, its marketing director, falsely 10 asserted that there was a protocol for pre-diabetics to be treated by MAT(ß. Therefore, the 11 plaintiffs further assert on information and belief that these defendants are engaging in actions 12 designed to further mislead and harm the public, resulting in what may ultimately be permanent 13 damage to the reputation of the MA TII therapy when it either fails to live up to the false 14 promises and hype of the defendants or causes severe damage or death by its misuse by these 15 defendants. 16 89. The Shreveport Clinic affiliated defendants have made it clear that they intend to Dr. Aoki, without permission to do so, to 17 continue to operate their clinic and use the Patents of 18 the fullest extent possible unless and until they are stopped by a court oflaw. 19 The Santa Barbara Clinic Is Opened 20 90. The plaintiffs are informed and believe that the Santa Barbara Clinic, and the 21 defendants affliated with that clinic as alleged above, was opened with the participation and 22 assistance provided by defendants Gilbert, Bionica, CATC, Kunz and MedEdCo. Upon 23 information and belief, the Santa Barbara Clinic first began providing services to patients during 24 the spring or summer of2012, offering the plaintiffs' proprietary MAT(ß treatment under the 25 name Artificial Pancreas Therapy. 26 91. The website operated by the defendants affiiated with the Santa Barbara Clinic, 27 www.1ifepulsehealth.com. refers to defendant Gilbert as its "Founder" and references defendant 28 "Trina Health" directly on the website. Much of the false and misleading content found on 26 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 27 of 47 1 defendant Gilbert's website ww.diabetes.netis duplicated on the Santa Barbara Clinic website, 2 including the false statements regarding reimbursement through MediCare and health insurance 3 companies -- a fact known by the defendants to be false. Included with these statements are 4 video links with interviews of defendant Gilbert making the claim to be the developer of MAT(I 5 92. The website for the Santa Barbara Clinic provides that a purpose of these 6 defendants is to open 10 clinics in the Los Angeles/Orange County region, including a special 7 "investor login" link on the website suggesting that they are misleading additional outside third 8 parties to invest money into opening additional ilegal clinics. Thus, the defendants associated 9 with the Santa Barbara Clinic have made it clear that they intend to continue to use the Patents of 10 Dr. Aoki, without permission to do so, to the fullest extent possible unless and until they are 11 stopped by a court oflaw. 12 93. Upon further information and belief, the Santa Barbara Clinic is engaging in the 13 corporate practice of medicine in violation of California Business & Professions Code §2400 et 14 seq. and operating a clinic without first being licensed to do so in violation of California Health 15 and Safety Code §1205. 16 Gilbert's Ongoing Conduct Resulting In Additional Clinic Openings 17 94. The plaintiffs are informed and believe, and on that basis allege, that Gilbert, 18 Bionica, CATC, Kunz and MedEdCo are engaging in ongoing infrnging and tortious conduct by 19 their direct participation in the opening of clinics to offer the MA T(ß treatment in other regions 20 within the United States as well as in foreign countries, all of which appears to be confinned on 21 defendant Gilbert's website ww.diabetes.net. 22 95. Upon information and belief, individual defendants Gilbert and Kunz, and their 23 respective entities, have recently participated in the creation and opening of the following clinics 24 where they are offering the MAT(ß treatment (under the misleading moniker "Artificial Pancreas 25 Therapy") without the plaintiffs' permission to do so: 26 a. Miami Beach, Florida - opened on or about August or September 20 II; 27 b. Hong Kong - opened on or about September or October 20 11; 28 c. Shreveport, Louisiana - opened with defendants Chui, Limi, and DLP LA in 27 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 28 of 47 2012; 1 2 d. Houston, Texas opened on or about March 2013; 3 e. Sacramento, California - recently opened in late 2012 or early 2013; 4 f. Charlotte, North Carolina - allegedly "opening soon" according to the www.diabetes.net website; 5 g. New York City, New York - a provider has been identified and a location is 6 being sought according to the ww.diabetes.net website; 7 h. Mexico and South Africa - they are in the "final steps of opening clinics" in 8 these countries according to the ww.diabetes.net website. 9 10 96. These defendants have made it clear that they intend to continue to use the Patents 11 of Dr. Aoki, without permission to do so, to the fullest extent possible unless and until they are 12 stopped by a court oflaw. 13 Cease and Desist Demands Have Gone Unheeded 14 97. The original named defendants each received a cease and desist request from 15 counsel for the plaintiffs, advising the defendants that all intellectual property rights to the 16 MAT(ß treatment are held by the plaintiff and that, should the defendants open a clinic and begin 17 to use the MA T(ß treatment, it would be infringing the Patents and intellectual property rights of 18 the plaintiffs. However, upon information and belief, the defendants have recently each opened 19 a clinic as described hereinabove and have infringed and continue to infringe the Patents and those clinics. 20 plaintiffs' intellectual property rights by the operation of 21 FIRST CLAIM FOR RELIEF 22 Patent Infringement (35 U.S.c. §271(a), (b)) As to All Defendants 23 24 98. Plaintiffs reallege, as if fully set forth herein, the allegations contained in 25 paragraphs 1 through 97. 26 99. Upon information and belief, in the defendants' operation of the California clinics 27 including, but not limited to, locations in Rosevile, Sacramento, Hayward, Newport Beach, the Louisiana, Florida, North Carolina, 28 Costa Mesa, and Santa Barbara, and in the operation of 28 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 29 of 47 1 Texas and planned New York clinics, the defendants have been and currently are infringing the 2 U.S. Patents by using, marketing, sellng, offering for sale the MAT(ß treatment and using said 3 systems and methods described within the Patents for the purpose of improving hepatic glucose 4 processing in patients who receive the treatment, as well as for treating complications associated 5 with diabetes, including heart and cardiovascular disease, wound healing, kidney disease, eye 6 disease and nerve disease. The defendants' use of the claims in the Patents has been done plaintiff 7 without the authorization of 8 Dr. Aoki. 100. Upon information and belief, the defendants have had actual and constructive 9 knowledge of the Patents prior to opening the clinics at issue, including the knowledge that the Dr. Aoki and no license rights to those Patents have been nor wil be 10 Patents are in the name of 11 conferred by Dr. Aoki to the defendants to use the systems and methods described in the Patents. 12 101. Defendants, by and through their use of the Patents as identified hereinabove, Dr. Aoki in the operation ofthe 13 have, and continue to, either: a) directly infringe the Patents of Dr. Aoki by inducing, causing, or 14 defendants' clinics; and/or b) indirectly infrnge the Patents of 15 materially contributing to the infringing conduct of others with knowledge and/or wilful 16 blindness of 17 18 infringement of the infringing activity. 102. Upon information and belief, plaintiffs further allege that the defendants' the Patents has been intentional and wilful, has caused and wil continue to 19 cause damage to plaintiffs, and is causing irreparable harm to plaintiffs for which there is no 20 adequate remedy at law. 21 103. Pursuant to 35 u.S.C. §284, the plaintiffs are entitled to recover from defendants 22 the damages they have sustained and wil sustain, and any gains, profits and advantages obtained 23 by the defendants as a result of their acts of infringement alleged above, together with interest 24 and costs as fixed by the court. At present, the amount of such damages, gains, profits and 25 advantages cannot be fully ascertained. 26 the defendants' blatant 104. Pursuant to 35 U.S.c. §284, the wilfulness of 27 infringement upon the plaintiffs' exclusive rights to the Patents entitles the plaintiffs to an 28 increase in damages up to three times the amount found. Furthermore, plaintiffs assert that this 29 FIRST AL\1ENDED COMPLAINT FOR PATENT INFRIGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 30 of 47 1 is an "exceptional" case, especially given the outrageous conduct of defendant Gilbert in light of 2 his position as the former counsel, officer and director of the plaintiffs, such that the plaintiffs are attorneys' fees pursuant to 35 U.S.C. §285. 3 entitled to an award of 105. Pursuant to 35 U.S.C. §283, the plaintiffs are entitled to injunctive relief against 4 5 the defendants -- unless defendants are restrained by this Court from continuing their 6 unauthorized use of the Patents, the injuries to the plaintiffs and to the general public wil 7 continue. The consequence of continued infringement by these defendants could very well result 8 in either severe injury or death of a patient(s) due to the inexperience and lack of adequate 9 training of the defendants and their agents, employees, and all persons acting in concert with 10 them. Any severe injury or death caused by the defendants' infrngement could have a serious 11 detrimental impact upon the plaintiffs' ability to continue clinical trials and development of the 12 treatment. 13 14 of 106. For the safety of the general public, and to avoid detrimental and irreparable loss value and goodwil in the MAT(ß treatment, the plaintiffs are entitled to an injunction 15 restraining defendants, their agents and employees, and all persons acting in concert with them, 16 from providing the MAT(ß treatment in violation of35 U.S.C. §271. Furthermore, defendants 17 Gilbert, Bionica, CATC, and any other defendant who has falsely asserted license rights to the 18 Patents, must be restrained and permanently enjoined from representing to the public and third 19 parties that the defendant(s) holds any right, title or interest in the Patents, and be ordered to 20 disclose this fact to persons and entities with whom the defendant(s) are associated and acting in 21 concert with respect to other clinics not included within this litigation, including, but not limited 22 to, those clinics offering MA T(ß treatment in Miami, Florida, Shreveport, Louisiana, and Hong 23 Kong. 24 WHEREFORE, Plaintiffs pray for judgment against all defendants, and each of them, as 25 hereinafter set forth below. 26 / / / 27 / / / 28 / / / 30 FIRST AMENDED COMPLAINT FOR PATENT INFRIGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 31 of 47 1 SECOND CLAIM FOR RELIEF 2 Copyright Infringement (17 USC §106 et seq.) As to All Defendants 3 4 107. Plaintiffs reallege, as if fully set forth herein, the allegations contained in 5 paragraphs I through 97. 6 108. In or about 1990, Dr. Aoki and G. Steven Hammond, MD, PhD, jointly authored Health Status in Diabetic Patients - Diabetes Impact 7 an article entitled "Measurement of 8 Measurement Scales" which was peer reviewed and published in the periodical Diabetes Care in 9 April 1992. The article was initiated by Dr. Aoki because he needed a quality oflife instrument 10 to be used with MAT(ß treatment. The two authors worked jointly to design a questionnaire to 11 measure a diabetic's quality oflife using Dr. Hammond's expertise as a psychologist and 12 endocrinologist and Dr. Aoki' s expertise as a nationally recognized diabetes specialist. The 13 "DIMS" questionnaire was thereafter used in a clinical, correlative study of diabetic patients to the questionnaire to ensure that it had internal 14 examine the psychometric properties of 15 consistency and test-retest reliability and, therefore, determined to be a valid instrument to 16 measure health status in adult Type I and Type II diabetic patients. The article discussed the 17 study and the results thereof, including how the questionnaire is to be used and analyzed, and the 18 appendix at the end of the article set forth the DIMS questionnaire itself. The purpose of using 19 the DIMS questionnaire with MAT(ß treatment is to measure the longitudinal changes in diabetic 20 patients to quantitate treatment benefit in clinical trials. The first page of the article specifically 21 stated that reprint requests were to be made to Dr. Aoki. 22 109. Furthermore, in or about March of2002, Dr. Aoki created a detailed PowerPoint 23 presentation in order to better educate physicians and potential investors on the benefits of 24 MAT(ß treatment (the "MAT(ß Presentation"). The MAT(ß Presentation sets forth, inter alia, 25 MAT's history, clinical information from diabetes studies, and photos of the effects of MAT 26 treatments on some patients. The diagrams in the MA T(ß Presentation were created by Dr. Aoki 27 and the patient photos were taken by him. Dr. Aoki drafted much of the text included in the 28 presentation and, for the text not authored by him, was solely responsible for its selection and 3I FIRST AL\1ENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 32 of 47 1 arrangement. 2 110. In or about May 2002, and in order for defendant Gilbert to familiarize himself 3 better with the MA T(ß procedure, Gilbert was provided with a copy of the MA T(ß Presentation 4 by Dr. Aoki. At the time the MAT(ß Presentation was provided to Gilbert, Dr. Aoki specifically 5 told him that the MAT(ß Presentation was solely for Gilbert's personal educational use and was 6 not to be distributed or disclosed to anyone else. 7 111. On or about August 23, 2011, Dr. Aoki's counsel filed an application with the 8 U.S. Copyright Office to register Dr. Aoki's copyright rights in the MAT(ß Presentation. A true 9 and correct copy of the application and receipt of filing is attached hereto as Exhibit A. 10 112. On or about October 13,201 I, Dr. Aoki's counsel filed an application with the 11 U.S. Copyright Offce to register Dr. Aoki's copyright rights in the DIMS article and 12 questionnaire. A tre and correct copy of the application and receipt of filing is attached hereto 13 as Exhibit B. 14 113. Plaintiffs have recently discovered that a PowerPoint presentation on "Cellular the defendants' various names for 15 Activation Therapy" (the "CAT Presentation") - one of 16 MAT(ß treatment -- was posted in full on these websites: ww.americandiabetestherapy.com. 17 www.americandiabetestherapycenters.com and on www.diabeticinnovations.com, and in part on 18 www.stopdiabetesmd.com. Where the CAT Presentation appears in full, identified on the first 19 page of the document are the names of defendants Bionica and www.diabetes.net (aka defendant the materiaL. More specifically, included on the CAT 20 Gilbert) asserting ownership of 21 Presentation is the statement "Copyright Bionica Inc. All rights reserved. Confidential; no Bionica, Inc." 22 disclosure without permission of 23 114. The CAT Presentation reproduces a number of elements from Dr. Aoki's MAT(ß 24 Presentation including some diagrams, Dr. Aoki' s patient photos, several charts, and text. On 25 information and belief, defendant Gilbert/CATC/Bionica created an unauthorized derivative 26 work of the MA T(ß Presentation, resulting in the CAT Presentation, which was then distributed 27 to the other defendants herein. The distribution of the MA T(ß Presentation was without Dr. 28 Aoki's authorization. 32 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 33 of 47 1 115. Upon information and belief, the defendants are reproducing, distributing and 2 using the DIMS questionnaire in the operation of the California clinics located in Rosevile, 3 Sacramento, Hayward, Newport Beach, Costa Mesa, Santa Barbara, Shreveport, and in the 4 operation of the Texas clinics. It is further anticipated that the defendants have reproduced the 5 and distributed the material for the Miami Beach, Florida and Charlotte, North Carolina clinics, 6 as well as the clinics that are located in Hong Kong, Mexico and South Africa. The reproduction 7 and distribution of the DIMS questionnaire has been done without the authorization of plaintiff 8 Dr. Aoki, nor with the authorization and permission of Dr. Hammond. plaintiff 9 116. Defendants, by and through their use of Dr. Aoki's copyrighted works as 10 identified hereinabove, have either a) directly infringed the plaintiffs exclusive rights under the 11 Copyright Act; b) contributorily infringed the plaintiff s exclusive rights under the Copyrght Act 12 by inducing, causing or materially contributing to the infringing conduct of others with 13 knowledge of the infringing activity; and/or c) vicariously infringed the plaintiffs exclusive 14 rights under the Copyrght Act by enjoying a direct financial benefit from another's infringing 15 activity. the defendants' infringing activities, plaintiff and the 16 117. As a proximate cause of 17 general public, has and wil suffer irreparable injury. 18 WHEREFORE, Plaintiffs pray for judgment against defendants, and each of them, as 19 hereinafter set forth below. 20 THIRD CLAIM FOR RELIEF 21 Trade Secret Misappropriation (CaL. Civil Code §§3426 et seq.) As to All Defendants 22 23 118. Plaintiffs reallege, as if fully set forth herein, the allegations contained in 24 paragraphs I through 97. 25 119. As set forth above, defendant Gilbert was the attorney for the plaintiffs and an 26 offcer/director of plaintiff ADRI prior to late 2002/early 2003, when the relationship was 27 permanently terminated. As a result of such relationships, and while in a position of 28 responsibility, trust, and confidence, defendant Gilbert became intimately familiar with 33 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 34 of 47 numerous trade secrets 1 plaintiffs' operations and was granted access to and gained knowledge of 2 and confidential and proprietary information that are the property of plaintiffs, including, but not 3 limited to, the following: 4 a. Information associated with the actual administration ofMAT(I treatment on 5 patients for optimal effect - information which has been acknowledged by the 6 defendants to have required years of experimentation by the plaintiffs in order 7 to determine how to give the MAT(ß treatment in the optimal way; 8 b. Details and information regarding the changes experienced by patients who 9 have received the MAT(ß treatment at the plaintiffs' clinics; 10 c. Information regarding how to best reduce consequences and side effects when 11 treating patients with MAT(ß; 12 d. Information regarding which patients are best suited for receiving the MA T(I 13 treatment; and 14 e. Information regarding training of physicians and medical personnel to be 15 supervised by physicians in the proper application of MA T(ß treatment. 16 its business, plaintiffs developed and have 120. As set forth above, in the course of 17 maintained proprietary, confidential business information with respect to the MAT(ß treatment. 18 This information has been developed over a substantial period of time, required substantial 19 money and effort to compile, is unavailable to the public or to plaintiffs' competitors, and would 20 be of great value to plaintiffs' competitors. Plaintiffs' trade secret information has been the 21 subject of reasonable efforts to maintain its confidentiality, including restricting access to the 22 information only to those who must use it to perform their jobs for plaintiffs or who are under an 23 obligation to maintain the confidentiality thereof. 24 121. As an attorney, offcer and director for plaintiffs, defendant Gilbert was entrusted 25 with access to and protection of the trade secrets described above. In addition, defendant Kunz 26 was provided with limited access to some of the trade secret information regarding training of 27 personnel, and was entrusted to maintain its confidential nature. Plaintiffs are informed and 28 believe, and thereon allege, that, defendant Gilbert and defendant Kunz have provided the 34 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 35 of 47 1 plaintiffs' trade secret information to all remaining defendants in order to assist them in opening 2 and operating clinics in which the plaintiffs' MAT(ß treatment is used on patients from the 3 general public. 4 122. Defendants, and each ofthem, knew or had reason to know that such information 5 received from Gilbert and/or Kunz, was the trade secret, confidential and proprietary information 6 of the plaintiffs in that the information had independent economic value from the disclosure or 7 use of the information, and that plaintiffs made or took reasonable efforts to ensure the secrecy 8 of this information. 9 123. Defendants improperly misappropriated the above-identified trade secret 10 information from the plaintiffs without the express or implied consent from plaintiffs and 11 through deceit and misrepresentation and tortious conduct. Defendants knew or had reason to the plaintiffs' trade secret information 12 know that defendants Gilbert's and Kunz's knowledge of 13 was originally acquired under circumstances giving rise to a duty to maintain its secrecy. 14 the acts and practices of defendants, 124. As a direct and proximate consequence of 15 defendants have caused, are causing and, unless such acts and practices are enjoined by the 16 Court, wil continue to cause irreparable harm to plaintiffs and the general public for which there 17 is no adequate remedy at law. Therefore, plaintiffs seek the award of a preliminary and 18 permanent injunction against the defendants, pursuant to California Civil Code §3426.2, 19 prohibiting any and all further use of the trade secrets at issue, requiring the return of any and all 20 materials misappropriated from plaintiffs relating to the trade secrets, and to stop all activities 21 arising from the defendants' misappropriation of 22 plaintiffs' trade secrets. 125. As a further direct and proximate result of defendants' misappropriation, the 23 defendants have been unjustly enriched in an amount according to proof. 24 126. Defendants' misappropriation of plaintiffs' trade secret and proprietary 25 information was willful, intentional, and malicious, entitling plaintiffs to an award of punitive 26 and exemplary damages in an amount not exceeding twice the damages awarded by the court attorneys' fees pursuant to 27 pursuant to California Civil Code §3426.3(c), and to an award of 28 California Civil Code §3426.4. 35 FIRST AL\1ENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 36 of 47 1 WHEREFORE, Plaintiffs pray for judgment against defendants, and each of them, as 2 hereinafter set forth below. 3 FOURTH CLAIM FOR RELIEF 4 False and Misleading Advertising Act-15 USC §1125(a)(I)) 5 As to All (Lanham Defendants fully set forth herein, the allegations contained in 6 127. Plaintiffs reallege, as if 7 paragraphs 1 through 97. 8 128. Upon information and belief, the defendants have attempted to suppress 9 competition from the plaintiffs, and to cause risk and harm to the general public, by making false 10 and misleading statements regarding the treatment being offered by the defendants at their 11 respective clinics and matters associated therewith. The nature of the false and misleading 12 claims which have been made, and which continue to be made, by the defendants, either orally, 13 electronically, and/or in writing, include, but are not limited to, the following types of statements 14 and assertions: 15 a. the efficacy of the treatment offered by the defendants (e.g. stating that it 16 stops and/or reverses all complications of diabetes in virtally all sufferers) 17 and alleged absence of adverse side effects; 18 b. that the defendants have been integrally involved in the development of the 19 Patents and treatment, including claims that defendant Gilbert is the sole 20 individual responsible for the treatment under the Patents and for the the Bionica pump (both of 21 development of which are wholly false); 22 c. defendants' have the right(s) to use the Patents and/or have ownership thereof; 23 d. the effcacy of the treatment with respect to Type 2 diabetes patients when no 24 peer reviewed data has been provided to support this application; 25 e. that the Bionica pump: i) is the only infusion device which can be used for the 26 MAT(ß treatment; ii) is an integral part of the patented treatment; iii) is itself 27 protected by a patent; and/or iv) has never failed. 28 f. that defendants have treated more than 100,000 patients; 36 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 37 of 47 1 g. that defendants have been performing the treatment under the Patents for more than 20 years; 2 3 h. that Medicare and private insurance cover the treatment and wil reimburse 4 the patients, including false statements such as "In every legal challenge of 5 insurance reimbursement for (the treatment), the patients have won and the 6 insurers have paid." 7 1. experimental) and is therefore covered by private insurance and Medicare; 8 9 that the treatment has been deemed medically necessary (and not J. that the defendants promise to enforce the patients' rights if either private 10 insurance or Medicare refuse to pay for the defendants' services; 11 k. the scope of physician participation and supervision required for safe implementation of the treatment under the Patents; 12 13 1. the experience, background and qualifications of defendants, including, but 14 not limited to, exaggerated claims in an effort to generate a level of legitimacy 15 not warranted by the facts; 16 m. using testimonials provided to the plaintiffs by the plaintiffs' own patients in a misleading way that suggests that the patients were treated by the defendants; 17 18 n. changing, deleting and/or adding language to research articles and/or 19 publications to present a false and misleading impression of 20 treatment being offered by the defendants; 21 o. the efficacy of the accusing the plaintiffs of not sharing the technology under the Patents and 22 thereby depriving "many who have suffered and died" because the plaintiffs 23 were just "awaiting the right time to maximize (the treatment's) economic 24 potential," referrng to the plaintiffs' alleged "indifference" to suffering while 25 in the pursuit of money to be tantamount to a "non statutory crime." 26 p. that the defendants' purported Artificial Pancreas Treatment is an "FDA 27 approved" Artificial Pancreas System that has been in continuous use for 22 28 years, whereas the treatment does not fit within the FDA definition of an 37 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 38 of 47 1 "Artificial Pancreas System" and has not been in continuous use for 22 years 2 by the plaintiffs. 3 129. The above-referenced statements are material in that they influence or are likely 4 to influence a patient's decision to pursue treatment; however, the misrepresentations are either 5 blatantly false or clearly misleading. These misrepresentations have caused or are likely to cause 6 confusion, mistake, physical harm and financial damage to patients who seek the treatment from 7 defendants. 8 130. The misrepresentations are made over the internet, as well as using other means, 9 in the defendants' efforts to market their infringing treatment in interstate commerce. 10 131. The defendants have publicized such false and misleading descriptions and the Lanham Act §43(a), 15 U.S.c. §1125(a). On information and 11 representations in violation of 12 belief, the defendants' aforesaid acts are deliberate and wilfuL. 13 132. Unlike the defendants, the plaintiffs make every effort to provide accurate 14 information and full disclosure to their patients in order to acquire the necessary informed 15 consent for treatment. Plaintiffs have suffered and, absent judicial relief, wil continue to suffer 16 competitive harm and injury has a result of the defendants' false and misleading advertising. 17 Furthermore, the defendants false and misleading statements bring disrepute to the treatment 18 insofar as it does not and cannot live up to the false promises being made by the defendants in an 19 effort to lure patients into their clinics for treatment. 20 133. Defendants' conduct alleged herein is irreparably damaging to plaintiffs and to 21 the general public, and will continue to so damage plaintiffs and the public until restrained by 22 this Court and, therefore, both the plaintiffs and the public are without an adequate remedy at 23 law. 24 134. Plaintiffs are entitled, pursuant to 15 U.S.c. §§ 1117 and lI25(a), to recover their 25 reasonable attorneys' fees and litigation expenses incuHed in connection with remedying the 26 defendants' false and misleading statements and representations. 27 WHEREFORE, Plaintiffs pray for judgment against defendants, and each of them, as 28 hereinafter set forth below. 38 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 39 of 47 1 FIFTH CLAIM FOR RELIEF 2 False and Misleading Advertising (CaL. Business & Professions Code §17500) As to All Defendants 3 4 135. Plaintiffs reallege, as if fully set forth herein, the allegations contained in 5 paragraphs I through 97, and 128 through 133. 6 136. Upon information and belief, the defendants have attempted to suppress 7 competition from the plaintiffs, and to cause risk and harm to the general public, by making false 8 and misleading statements regarding the treatment being offered by the defendants at their 9 respective clinics and matters associated therewith. The nature of the false and misleading 10 claims which have been made, and which continue to be made, by the defendants, either orally, 11 electronically, and/or in writing, include, but are not limited to, those types of statements and 12 assertions identified in paragraph 128. 13 137. The above-referenced statements are material in that they influence or are likely 14 to influence a patient's decision to pursue treatment; however, the misrepresentations are either 15 blatantly false or clearly misleading. These misrepresentations have caused or are likely to cause 16 confusion, mistake, physical harm and financial damage to patients who seek the treatment from 17 defendants. 18 138. The defendants have publicized such false and misleading descriptions and 19 representations in violation of California Business and Professions Code § 17500, § 17505, 20 § 17508(a), and § 17533.6. Upon information and belief, the defendants' aforesaid acts are 21 deliberate and wilfuL. 22 139. Unlike the defendants, the plaintiffs make every effort to provide accurate 23 information and full disclosure to their patients in order to acquire the necessary informed 24 consent for treatment. Plaintiffs have suffered and, absent judicial relief, will continue to suffer 25 competitive harm and injury has a result of the defendants' false and misleading advertising. 26 Furthermore, the defendants false and misleading statements bring disrepute to the treatment 27 insofar as it does not and cannot live up to the false promises being made by the defendants in an 28 effort to lure patients into their clinics for treatment. 39 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 40 of 47 1 140. Defendants' conduct alleged herein is irreparably damaging to plaintiffs and to 2 the general public, and wil continue to so damage plaintiffs and the public until restrained and 3 enjoined by this Court pursuant to California Business and Professions Code § I 7535, and, 4 therefore, both the plaintiffs and the public are without an adequate remedy at law. 5 i 4 I. Plaintiffs are entitled, pursuant to California Business and Professions Code 6 § 17535, to restitution or disgorgement, to the extent and in an amount to be proven at trial on this 7 matter. 8 WHEREFORE, Plaintiffs pray for judgment against defendants, and each of them, as 9 hereinafter set forth below. 10 SIXTH CLAIM FOR RELIEF 11 Breach of Fiduciary Duty As to Defendant Gilbert 12 fully set forth herein, the allegations contained in 13 142. Plaintiffs reallege, as if 14 paragraphs I through 14 I . the attorney-client relationship that defendant Gilbert had with both 15 143. By reason of 16 plaintiffs, as well as by reason of the officer/director relationship Gilbert had with ADRI, 17 defendant Gilbert owed a fiduciary duty to the plaintiffs that existed during the relationship with 18 plaintiffs and continued thereafter up through the present time. 19 144. Defendant Gilbert has intentionally, wilfully, fraudulently and in conscious 20 disregard of his fiduciary duties to the plaintiffs by engaging in the acts alleged in this complaint. 21 Such acts include, but are not limited to, the following: (a) competing with the plaintiffs; (b) 22 infringing the Patents; (c) infringing Dr. Aoki's copyrights; (d) misappropriating trade secrets; 23 (e) engaging in false and misleading advertising to gain a competitive advantage over the 24 plaintiffs; (f) sharing confidential business information with the other defendants in order to gain 25 a competitive advantage over the plaintiffs; (g) operating unlicensed clinics in competition with being more interested in money than patients; 26 the plaintiffs; (h) falsely accusing the plaintiffs of time and money made by 27 (i) encouraging and inducing others to take credit for the investment of 28 the plaintiffs with respect to the MA T(I treatment; and (j violating California Business and 40 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 41 of 47 Professional Conduct setting forth a 1 Professions Code § I 7200 et seq. and the California Rules of that 2 lawyer's duties and obligations to his clients both during and after termination of 3 relationship. 4 145. As a direct and proximate result of said breaches of fiduciary duty which have 5 occurred with respect to the conduct alleged in this complaint, the plaintiffs have sustained 6 damages, the full nature and extent of which are presently unkown to the plaintiffs but which 7 are subject to proof at triaL. 8 146. Plaintiffs are informed and believe, and on that basis allege, that the wrongful 9 conduct by defendant Gilbert was done with the intent to injure the plaintiffs and their business. 10 Plaintiffs are further informed and believe, and on that basis allege, that said despicable acts 11 were done maliciously, oppressively and with a wanton disregard of plaintiffs' rights. Plaintiffs 12 are therefore entitled to exemplary and punitive damages against defendant Gilbert 13 147. The threatened ongoing wrongful conduct of defendant Gilbert, unless and until 14 enjoined and restrained by order of this Court, will cause great and irreparable injury to the 15 plaintiffs, Plaintiffs have no adequate remedy at law for the injuries threatened and suffered as a 16 result of defendant Gilbert's ongoing violation of his fiduciary duties to the plaintiffs in that it 17 wil be impossible for plaintiffs to determine the precise amount of damage that they wil suffer 18 if the conduct of defendant Gilbert is not restrained, and the plaintiffs wil be forced to institute a 19 multiplicity of suits to obtain adequate compensation for their injuries. 20 WHEREFORE, Plaintiffs pray for judgment against defendant Gilbert as hereinafter set 21 forth below. 22 SEVENTH CLAIM FOR RELIEF 23 Breach of Confidential Relationship As to Defendant Gilbert 24 25 148. Plaintiffs reallege, as if fully set forth herein, the allegations contained in 26 paragraphs 1 through 147. 27 149. That during the period in which defendant Gilbert was acting as attorney for 28 plaintiffs, as well as an offcer and director for plaintiff ADRI, defendant Gilbert came into 41 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 42 of 47 1 possession of plaintiffs' confidential and novel information relating to their operation of a clinic 2 treating patients with MATqy treatment. Defendant Gilbert knew that this confidential 3 information was being disclosed to him in confidence and not for public disclosure. 4 150. Upon information and belief, beginning in or about 2010 and continuing to the 5 present time, defendant Gilbert disclosed said confidential and novel information to all other 6 defendants identified in this case as well as to individuals associated with clinics offering the 7 MAT(ß treatment in places including, but not limited to, Newport Beach, Sacramento, Miami 8 Beach, Shreveport, Houston, Charlotte, New York City, Hong Kong, Mexico, and South Africa. 9 15 I. Said acts of defendant Gilbert constitute breach of a confidential relationship Gilbert's duty of 10 between the plaintiffs and defendant Gilbert and a violation of 11 confidential information of his clients pursuant to California Rules of maintaining the Professional Conduct, Rule 12 3- ioO(A). 13 152. By reason of defendant Gilbert's acts alleged herein, plaintiffs have and wil 14 suffer damage to their business, reputation and good wil and defendant Gilbert has been and wil 15 continue to be unjustly enriched. 16 153. Defendant Gilbert acted wilfully, with malice, oppression, fraud and/or in 17 conscious disregard of the rights of the plaintiffs and, therefore, should be subject to punitive 18 damages and attorneys' fees.. 19 154. Defendant Gilbert has and wil continue to engage in such acts complained of 20 herein unless restrained and enjoined from doing so, causing irreparable damage and harm to the 21 plaintiffs and to the general public who is targeted by these clinics. It would be diffcult to 22 ascertain the amount of compensation which could afford the plaintiffs adequate relief for such 23 continuing acts, and a multiplicity of judicial proceedings would be required. Plaintiffs' remedy 24 at law is not adequate to compensate it for injuries threatened. 25 WHEREFORE, Plaintiffs pray for judgment against defendant Gilbert as hereinafter set 26 forth below. 27 / / / 28 / / / 42 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 43 of 47 1 EIGHTH CLAIM FOR RELIEF 2 Unfair Competition (Lanham Act 15 USC §1125(a)) As to All Defendants 3 fully set forth herein, the allegations contained in 4 155. Plaintiffs reallege, as if 5 paragraphs I through 154. 6 156. The defendants conduct as set forth above, including (a) infringing the Patents of 7 Dr. Aoki; (b) infringing Dr. Aoki's copyrights; (c) trade secret misappropriation; (d) false and 8 misleading advertising; (e) defendant Gilbert's breach of fiduciary duties and confidential 9 relationship with the plaintiffs, all constitute unfair competition in violation of 15 U.S.C. 10 §1125(a). 11 157. Upon information and belief, the defendants have engaged in the following 12 additional unlawful, unfair and/or fraudulent business practices, all in violation of 15 U.S.C. 13 § 1125(a): 14 a. Operating unlicensed clinics in violation of California Health and Safety Code 15 §1205; 16 b. Changing the language in published articles authored by others from questions the MAT(I treatment to definitive, 17 or speculation regarding the benefit of 18 positive statements regarding the benefits of the treatment; 19 c. Submitting a patent application to the U.S.P.T.O. which claimed and 20 described embodiments found in Dr. Aoki' s previously issued patents and hip of 21 publications, and asserting inventors technology developed by Dr. Aoki 22 (defendants McCarthy and Rose); 23 d. Plagiarizing scientific articles without giving proper credit to the author's 24 thereof; 25 e. Deliberately removing Dr. Aoki's name as the inventor ofMAT(ß and with 26 respect to scientific research performed by Dr. Aoki at ADRI, all in an effort 27 to discredit the plaintiffs and provide unwarranted credibility to the 28 defendants; 43 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 44 of 47 1 f. Failing and refusing to advise patients that the Centers for MediCare and 2 MediCaid Services issued a National Coverage Decision in 2009 denying 3 payment for MAT(ß treatment and all other treatments in the category called 4 outpatient intravenous insulin therapy (OIVIT). 5 158. As a direct and proximate result of defendants' wilful and wrongful acts, 6 defendants have unjustly profited such that the plaintiffs are entitled to recover all of said profits unfair competition in violation of 15 U.S.C. 7 acquired by defendants from their multiple acts of 8 § 1125(a). 9 159. Upon information and belief, plaintiffs allege that the defendants acted wilfully, the rights of 10 with malice, oppression, fraud and/or in conscious disregard of the plaintiffs and, 11 therefore, should be subject to treble damages pursuant to 15 U.S.c. §1117(a). 12 160. As a further proximate cause of defendants' wilful and wrongful acts set forth 13 above, the plaintiffs have suffered and wil continue to suffer substantial harm which is 14 impossible to determine, including irreparable injury to their business reputation and goodwilL. 15 As such, a remedy a law is inadequate to compensate for the injuries inflicted by the defendants. 16 Accordingly, plaintiffs are entitled to have this Court issue an order enjoining the defendants 17 from any further such acts during the course of the litigation and on a permanent basis thereafter. them, as 18 WHEREFORE, Plaintiffs pray for judgment against defendants, and each of 19 hereinafter set forth below. 20 NINTH CLAIM FOR RELIEF 21 Unfair Competition and Unfair Business Practices 22 As to All Defendants (CaL. Business & Professions Code §17200) 23 i 61. Plaintiffs reallege, as if fully set forth herein, the allegations contained in 24 paragraphs I through 160. 25 162. The defendants conduct as set forth above, including (a) infringing the Patents of 26 Dr. Aoki; (b) infringing Dr. Aoki' s copyrights; (c) trade secret misappropriation; (d) false and 27 misleading advertising; (e) defendant Gilbert's breach of fiduciary duties and confidential 28 relationship with the plaintiffs, including his breach of California Business and Professions Code 44 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 45 of 47 1 §6068, all constitute unfair competition in violation of California Business and Professions Code 2 § i 7200 et seq.. 3 163. Upon information and belief, the defendants have engaged in additional unlawful, 4 unfair and/or fraudulent business practices, all in violation of California Business and 5 Professions Code § 17200 et seq., as set forth above in paragraph 157. 6 164. As a direct and proximate result of defendants' wilful and wrongful acts, 7 defendants have unjustly profited such that the plaintiffs are entitled to recover all of said profits 8 acquired by defendants from their multiple acts of unfair competition in violation of California 9 Business and Professions Code § 17200 et seq. 10 165. As a further proximate cause of defendants' wilful and wrongful acts set forth 11 above, the plaintiffs have suffered and wil continue to suffer substantial harm which is 12 impossible to determine, including irreparable injury to their business reputation and goodwill. 13 As such, a remedy a law is inadequate to compensate for the injuries inflicted by the defendants. 14 Accordingly, plaintiffs are entitled to have this Court issue an order enjoining the defendants 15 from any further such acts during the course of the litigation and on a permanent basis thereafter. them, as 16 WHEREFORE, Plaintiffs pray for judgment against defendants, and each of 17 hereinafter set forth below. 18 PRAYER FOR RELIEF 19 WHEREFORE, Plaintiffs respectfully request judgment as follows: 20 1. That defendants pay compensatory damages to the plaintiffs according to proof; 21 2. That, pursuant to 35 U.S.c. §284, plaintiffs recover any gains, profits and advantages obtained by the defendants as a result of their acts of infringement; 22 23 3. damages up to three times the amount found; 24 25 That, pursuant to 35 U.S.C. §284, the plaintiffs are entitled to an increase in 4. That defendants, including their offcers, agents, servants employees, and 26 attorneys, and all persons in active conceii or participation with any of them, be 27 enjoined from further infringing the Patents pursuant to 35 U.S.C. § 283 and 28 plaintiff Dr. Aoki's copyrights pursuant to 17 U.S.c. §502. Furthermore, that 45 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 46 of 47 1 defendants Gilbert, Bionica, CATC, and any other defendant who has falsely 2 asserted license rights to the Patents, be restrained and permanently enjoined from 3 representing to the public and third parties that the defendant(s) holds any right, 4 title or interest in the Patents, and be ordered to disclose this fact to persons and 5 entities with whom the defendant(s) are associated and acting in concert with 6 respect to other clinics not included within this litigation, including, but not 7 limited to, those clinics offering MAT(ß treatment in Florida, Texas, North 8 Carolina, New York, Hong Kong, Mexico, and South Africa; 9 5. That defendants, including their offcers, agents, servants employees, and 10 attorneys, and all persons in active concert or participation with any of them, be 11 enjoined from any and all further use of 12 return of any and all materials misappropriated from plaintiffs related to the trade 13 secrets, and to stop all activities arising from the defendants' misappropriation of 14 plaintiffs' trade secrets pursuant to California Civil Code §3426.2; 15 6. the plaintiffs' trade secrets, requiring the That defendants be ordered to disgorge and pay to the plaintiffs all unjust 16 enrichment received as a result of defendants' misappropriation of plaintiffs' trade 17 secrets and acts of unfair competition, in an amount according to proof; 18 7. That defendants be ordered to pay to plaintiffs an award of punitive and 19 exemplary damages for their wilful, intentional, and malicious conduct in 20 misappropriating the plaintiffs' trade secrets, in an amount not exceeding twice 21 the damages awarded by the court pursuant to California Civil Code §3426.3(c); 22 8. That defendant Gilbert be enjoined from disclosing the plaintiffs' confidential and 23 novel information, acquired by means of his confidential and fiduciary 24 relationship with the plaintiffs, to any other person or entity anywhere worldwide, 25 and to destroy any such information which remains in his possession; 26 9. That this Court award punitive damages against defendant Gilbert for his 27 deliberate and wilful breach of fiduciary duties and confidential relationships 28 with the plaintiffs; 46 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case 2:11-cv-02797-TLN-CKD Document 135 Filed 04/02/13 Page 47 of 47 1 10. and wilful acts of unfair competition; 2 3 That this Court award punitive damages against the defendants for their deliberate 11. That defendants be required to pay plaintiffs' reasonable attorneys' fees as 4 provided by 35 U.S.C. §285, 17 U.S.c. §505, California Civil Code §3426.4, 15 5 U.S.C. § 1117(a), and/or any other basis provided for under federal or California 6 law; 7 12. associated with this action; and 8 9 That defendants be required to pay prejudgment interest and plaintiffs' costs 13. All such other relief that the Court deems just and proper in this action. 10 DEMAND FOR JURY TRIAL 11 Plaintiffs hereby demand a trial by jury of any issues triable of right by jury. 12 13 DATED: April 2, 2013 LAW OFFICES OF JOANNA R. MENDOZA, PC 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 47 FIRST AMENDED COMPLAINT FOR PATENT INFRINGEMENT ETC. Case Document 135-1 Filed 04/02/13 Page 1 of 4 EXHIBIT A Case 2:11-cv-02797-TLN-CKD Document 135-1 Filed 04/02/13 Page 2 of 4 Mark Leonard From: Copyright Offce (cop-rc~loc.govJ Sent: Tuesday, August 23, 2011 5:10PM To: Mark Leonard Subject: Acknowledgement of Receipt THIS IS AN AUTOMATED EMAIL - DO NOT REPLY. Thank you for submitting your registration claim using the electronic Copyright Office (eCO) System. This email confirms that your application and fee for the work METABOLIC ACTIVATION THERAPY - HISTORY AND CURRENT PROTOCOL was received on 88/23/2811. The following applies to registration claims only (not preregistrations): The effective date of registration is established when the application. fee AND the material being registered have been received. If you have not yet sent the material to be registered. logon to eCO and click the blue case number associated with your claim in the Open Cases table. then do one of the following: For digital uploads: Click the Upload Deposit button at the top of the Case Summary screen. then browse and select the file(s) you wish to upload. Note: only certain classes of works may be registered with digital deposits (See FAQs: http://www . copyright. gov /eco/fag. html#eCO 1.4). For hardcopy submissions: Click the Create Shipping Slip button at the top of the Case Summary screen. then click the Shipping Slip link that appears in the Send By Mail table. Print out and attach the shipping slip to the copy(ies) of your work. For multiple works. be sure to attach shipping slips to the corresponding copies. A printable copy of the application will be available within 24 hours of its receipt. To access the application. click the My Applications link in the left top most navigation menu of the Home sc reen. You will be issued a paper certificate by mail after the registration has been completed. You may check the status of this claim via eCO using this number (1-652811541). (THREAD ID: 1-AS8IP1) United States Copyright Office Case 2:11-cv-02797-TLN-CKD Document 135-1 Filed 04/02/13 Page 3 of 4 *-APPLICATION-* Title Title of Work: METABOLIC ACTIVATION TIERAPY - HISTORY AND CURNT PROTOCOL Completion/Publication Year of Completion: 2002 Author II Author: Thomas T. Aoki, M.D. Author Created: text, photograph(s), artork Citizen of: United States Domiciled in: United States Copyright claimant Copyright Claimant: Thomas T. Aoki, M.D. I021 El Sur Way, Sacramento, CA, 95864 Rights and Permissions Name: Mark R. Leonard Email: mieonard~davisandieonard.com Telephone: 916-362-9000 Address: 8880 Cal Center Drive Suite 180 Sacramento, CA 95826 Certification Name: Thomas T. Aoki, M.D. Date: August 23,2011 Page lof 1 Case 2:11-cv-02797-TLN-CKD Document 135-1 Filed 04/02/13 Page 4 of 4 Registration #: Service Request#: 1-652011541 Priority: Routine Application Date: August 23,2011 08: 11:21 PM Correspondent Name: Mark R. Leonard Email: mleonard~davisandleonard.com Address: 8880 Cal Center Drive Suite 180 Sacramento, CA 95826 Mail Certificate Mark R. Leonard 8880 Cal Center Drive Suite 180 Sacramento, CA 95826 Telephone: 916-362-9000 Case Document 135-2 Filed 04/02/13 Page 1 of 5 EXHIBIT Case 2:11-cv-02797-TLN-CKD Document 135-2 Filed 04/02/13 Page 2 of 5 Mark Leonard From: Copyright Offce (cop-rc(gloc.gov) Sent: Thursday, October 13, 2011 3:34 PM To: Mark Leonard Subject: Acknowledgement of Receipt THIS IS AN AUTOMATED EMAIL - DO NOT REPLY. Thank you for submitting your registration claim using the electronic Copyright Office (eCO) System. This email confirms that your application and fee for the work Measurement of Health Status in Diabetic Patients: Diabetes Impact Measurement Scales was received on 1Ø/13/2Ø11. The following applies to registration claims only (not preregistrations): The effective date of registration is established when the application, fee AND the material being registered have been received. If you have not yet sent the material to be registered, logon to eCO and click the blue case number associated with your claim in the Open Cases table, then do one of the following: For digital uploads: Click the Upload Deposit button at the top of the Case Summary screen, then browse and select the file(s) you wish to upload. Note: only certain classes of works may be registered with digital deposits (See FAQs: http://www. copyright. gov /eco/fag. html#eCO 1.4). For hardcopy submissions: Click the Create Shipping Slip button at the top of the Case Summary screen, then click the Shipping Slip link that appears in the Send By Mail table. Print out and attach the shipping slip to the copy(ies) of your work. For multiple works, be sure to attach shipping slips to the corresponding copies. A printable copy of the application will be available within 24 hours of its receipt. To access the application, click the My Applications link in the left top most navigation menu of the Home screen. You will be issued a paper certificate by mail after the registration has been completed. You may check the status of this claim via eCO using this number (1-672859671). (THREAD ID: 1-B4MCF1) United States Copyright Office Case 2:11-cv-02797-TLN-CKD Document 135-2 Filed 04/02/13 Page 3 of 5 *-APPLICATION-* Title Title of Health Status in Diabetic Patients: Diabetes Impact Measurement Work: Measurement of Scales Completionl Publication Year of Completion: 1991 Date of 1st Publication: April 1, 1992 Nation of 1st Publication: United States Author · Author: Thomas T. Aoki, M.D. Author Created: text Domiciled in: United States Citizen of: United States · Author: G. Steven Hammond, M.D. , Ph.D. Author Created: text Citizen of: United States Domiciled in: United States Copyright claimant Copyright Claimant: Thomas T. Aoki, MD. 1021 EI Sur Way, Sacramento, CA, 95864 Rights and Permissions Organization Name: Davis & Leonard LLP Name: Mark R. Leonard Email: mleonard~davisandleonard.com Telephone: 916-362-9000 Address: 8880 Cal Center Drive Suite 180 Sacramento, CA 95826 Certification Page 1 of 2 Case 2:11-cv-02797-TLN-CKD Document 135-2 Filed 04/02/13 Page 4 of 5 Name: Thomas T. Aoki Date: October 13, 2011 Page 2 of 2 Case 2:11-cv-02797-TLN-CKD Document 135-2 Filed 04/02/13 Page 5 of 5 Registration #: Service Request #: 1-672859671 Priority: Routine Application Date: October 13,2011 06:34:48 PM Correspondent Organization Name: Davis & Leonard LLP Name: Mark R. Leonard Email: mleonard~davisandleonard.com Address: 8880 Cal Center Drive Suite 180 Sacramento, CA 95826 Mail Certificate Davis & Leonard LLP Mark R. Leonard 8880 Cal Center Dnve Suite 180 Sacramento, CA 95826 Telephone: 916-362-9000