Special master to decide whether Quinn Emanuel lawyers must contribute to $3M sanction
Law Firms
Special master to decide whether Quinn Emanuel lawyers must contribute to $3M sanction
A federal judge imposed a significant sanction for alleged misrepresentations about the need for Natera Inc. to introduce a supplemental expert report shortly before a jury trial. Sipa via AP Images
Updated: A federal judge in San Francisco ordered the payment of nearly $3 million in legal fees to a medical diagnostics company and appointed a special master to determine whether individual lawyers at Quinn Emanuel Urquhart & Sullivan should be at least partly responsible for payment.
Senior U.S. District Judge Edward M. Chen awarded more than $2.9 million in attorney fees to Guardant Health in a July 9 opinion.
Chen, a judge in the Northern District of California, imposed the sanction for alleged misrepresentations about the need for defendant Natera Inc. to introduce a supplemental expert report shortly before a jury trial, report Reuters and Law360.
Quinn Emanuel represented Natera in the litigation accusing its client of false advertising and unfair competition.
“But for the deliberate misrepresentation made to this court, the court would not have postponed trial and reopened discovery,” said Chen, a judge in the Northern District of California.
The supplemental report was based on a clinical study known as the COBRA study that examined Guardant’s colorectal cancer screening product. The misrepresentations left the impression that information on the COBRA study “was late breaking and seemingly new,” Chen wrote in an October 2024 decision.
But the expert actually had earlier knowledge of test information, something that came to light based on emails provided by the Rutgers Cancer Institute of New Jersey. The institute was involved in the study and was the expert’s employer. The expert maintained he was not able to find any communications with COBRA investigators.
Jurors awarded more than $292 million in damages to Guardant Health in November 2024 in its suit accusing Natera of making misleading claims about their competing tests for colorectal cancer.
Natera has said it disagrees with the jury decision and will seek to overturn it. The company has filed a motion for judgment as a matter of law or for a new trial.
Chen initially ruled on sanctions in the October decision. “The court grants in part and defers in part Guardant’s motion and finds sanctions are warranted due to both Natera’s (through its counsel at Quinn Emanuel) and [the expert’s] own deliberate misrepresentations to [U.S. Magistrate Judge Sallie Kim] and the undersigned of this court,” he wrote.
The sanctions included evidentiary sanctions in the form of excluding any mention of the COBRA study at trial. And, if the expert testified, jurors would be given an adverse instruction on the expert’s credibility.
Chen also said in October that monetary sanctions were “likely appropriate” for Quinn Emanuel after its correspondence with the expert suggested the law firm misled the court about the timing of the expert’s knowledge.
Guardant then sought attorney fees and costs of $2,985,909 as well as punitive sanctions—including a referral to state ethics regulators—against Quinn Emanuel lawyers “who appear to have had a hand in this conduct,” Chen said.
The Quinn Emanuel lawyers told Chen in declarations that their representations to the court were made in a good-faith belief of their truthfulness after relying on the expert witness.
“These declarations largely continue with the same narrative Natera’s counsel previously stated—they all relied on [the expert’s] representations,” Chen said. “Natera’s counsel states they were ‘shocked’ upon the discovery that [the expert] actually had emails and had received an initial draft of the COBRA study results. The court previously found this line of argument more than foolish.”
The lawyers’ declarations don’t warrant a deviation from a prior finding of bad faith, Chen said. The number of requested attorney-fee hours by Guardant is reasonable as is its requested billing rate, according to him.
Chen wrote that “the court may award the attorneys’ fees and costs to Guardant, either against Natera (the client), Natera’s counsel, Quinn Emanuel the firm (under the court’s inherent authority), or against specific attorneys under Section 1927,” which allows sanctions against attorneys “unreasonably and vexatiously” multiply case proceedings.
Chen said he is deferring questions on apportionment for resolution by the special master. He is also deferring to the special master Guardant’s request for a personal fine against the lawyers and a referral to the State Bar of California.
Quinn Emanuel released this statement to the ABA Journal: “We respectfully disagree with the court’s findings because we have always conducted ourselves with candor and in good faith. We look forward to presenting the full facts surrounding this matter to the special master.”
A Natera spokesperson also released a statement to the ABA Journal. “There has been no allegation that Natera or its employees knew about or participated in the alleged conduct described in the court’s order,” the statement said.
Story updated at 11:50 a.m. on Tuesday to add the word “individual” to the lede and to state that Chen found the misrepresentations were made by Natera through its counsel. Story also updated to add Natera’s statement. Story updated on July 16 at 8:28 a.m. to include specifics from Chen’s opinion on his sanction findings.
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