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Exhibit C
HOU:2554245.1
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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Honorable Marcia S. Krieger Civil Action No. 04-cv-01849-MSK-MEH CAVITAT MEDICAL TECHNOLOGIES, INC.
Plaintiffs, v. AETNA, INC., Defendants.
[CMT'S PROPOSED] FINAL PRETRIAL ORDER ___________________________________________________________________________ 1. DATE AND APPEARANCES CAVITAT MEDICAL TECHNOLOGIES, INC. ("Cavitat")originally filed this action as a Colorado State Court case on or about August 12, 2004, which was removed by Aetna, Inc. ("Aetna") to this court on or about September 8, 2004. Aetna filed a motion to dismiss on September 15, 2004 and Answer on June 26, 2004. Counsel of record are as follows: Carlos F. Negrete LAW OFFICES OF CARLOS F. NEGRETE 27422 Calle Arroyo San Juan Capistrano, CA 92675-2747 Phone: (949) 493-8115 Fax: (949) 493-9170 email: [email protected] Attorney for Plaintiff, CAVITAT MEDICAL TECHNOLOGIES, INC. Notice of Entry of Appearance on February 27, 2006 John B. Shely ANDREWS KURTH LLP 600 Travis, Suite 4200 Houston, Texas 77002 (713) 220-4200 (713) 220-4285 (Fax)
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[email protected] John M. Palmeri Franz Hardy WHITE AND STEELE, P.C. 950 17th Street, Suite 2100 Denver, Colorado 80202 (303) 296-2828 (303) 296-3131 (Fax) [email protected] [email protected] John M. Elliott James C. Crumlish III Mark J. Schwemler ELLIOTT GREENLEAF & SIEDZIKOWSKI, P.C 925 Harvest Drive P. O. Box 3010 Blue Bell, Pennsylvania 19422 (215) 977-1000 (215) 977-1099 (Fax) [email protected] ATTORNEYS FOR DEFENDANT, Aetna, Inc.
2. JURISDICTION
This Court has jurisdiction over this action pursuant to 28 U.S.C. §§ 1331, 1332 or 1367. The action is between citizens of different states and the matter in controversy exceeds the value of $75,000, exclusive of interest and costs. Aetna is a Pennsylvania corporation with a principal place of business at 980 Jolly Road, Blue Bell, Pennsylvania 19422. Cavitat is a corporation incorporated in Colorado and was at one time based in Colorado, but is now based in Texas, at 118 S. Texas Street, Texas 75440.
3. CLAIMS AND DEFENSES Plaintiff's Claims
This matter involves the claims of plaintiff CAVITAT Medical Technologies, Inc. 2
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against defendant Aetna, Inc. for disparagement and tortious interference with a prospective business relationship or contract. Cavitat has claims for disparagement and tortious interference with a prospective business relationship or contract. The elements of the disparagement claim are false statement published by a defendant to a third-party that was derogatory to the plaintiff's business in general or some element of the plaintiff's personal affairs; that the defendant intended to cause harm to the plaintiff's pecuniary interest or recognized or should have recognized that it was likely to do so; that the statement was made with malice, and that the statement caused special injury. The second claim is tortious interference with a prospective business relationship. Under Colorado law, there are a number of elements: The defendant intentionally and improperly interfered with the plaintiff's prospective contractual business relationship causing pecuniary harm. Tortious interference with an existing contract has similar elements: that the defendant was aware of the contract between the plaintiff and another party; that the defendant intended one of the parties to breach the contract, and the defendant induced the breach or made it impossible for one party to perform the contract. This case involves statements that were made by Aetna in a "Policy Bulletin," that was widely published in its internet site, attacking a an emerging technological medical device developed by Robert Jones, the principal owner of Cavitat. The device performs an ultrasonic image of Alvelor Process that has been applied to determine if there is a measurable necrosis (or hollow pockets) in jaw bones. The development of the CAVITAT was hailed as a breakthrough in dental technology. Prior to its development, no imaging device had been available for assisting dentists and physicians in precise determination of necrosis. Aetna does not, and cannot, dispute that the Cavitat is capable of producing an ultrasonic image that images the Alveolar Process. Instead, in its various contentions and statements, it attempt to discredit and attack the CAVITAT by associating it with a medical condition that the CAVITAT has been used to help diagnose. The CAVITAT is not a selfdiagnosing instrument, but rather an imaging device that creates three dimensional images which are used by medical professionals to assist in their various examinations of patients. The Court has already denied two Aetna motions to dismiss and ruled that claims for defamation of product and for interference with prospective business contract are properly stated against Aetna if Cavitat can prove the certain specific statements of fact from Aetna's internet published Clinical Policy Bulletin ("CPB") 642 are false and that Cavitat was injured by the false statements. Order of May 16, 2005 (Dkt #59). The Court rejected Aetna's arguments of opinion, fair comment, and constitutionally protected speech and specifically identified four statements of fact that, if false, were defamatory: (1) "[T]here is no scientific evidence to support [the Cavitat's] clinical value"; (2) "[T]he manufacturer was not required to supply evidence of effectiveness that would be required to support a pre-market approval application"; (3) "[T]here are no articles on the effectiveness of the Cavitat published in peerreviewed medical journals"; and 3
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(4) "FDA-approved labeling states that the clinical significance of the Cavitat ultrasound images is unknown." The first and fourth defamatory fact statements are based upon Aetna's assertion in CPB 642 that there is no scientific evidence to support the existence of the diseased condition, neuralgia inducting cavitational osteonecrosis ("NICO"), also described in the text books as "ischemic osteonecrosis," "Ratner's disease," "Robert's disease," and by other names. Aetna asserts in its bulletin that because the diseased condition that the CAVITAT ultrasound ("CAVITAT") is used in imaging does not exist, the CAVITAT itself is ineffective as an imaging tool. Aetna's bulletin cites and quotes liberally and literally from a defamatory publication of the self-appointed crusading website www.Quackwatch.com ("Quackwatch") called the Dodes and Schissel paper initially authored by general dentists Robert Dodes and Marvin Schissel and revised substantially by a retired psychiatrist, Dr. Stephen Barrett ("Barrett"), the operator of the website. The paper is not a peer reviewed published scientific paper and contains no references to any scientific studies or authorities. The commentary further states that medical and dental professionals who diagnose and treat NICO - and use the CAVITAT ultrasound - are engaging in consumer and insurance fraud because the disease according to them does not exist. Although Aetna's CPB does not repeat this statement of insurance fraud, it implies such conduct in its bulletin and cites to the Quackwatch paper which does make that statement. Aetna has used Quackwatch , Barrett and Dr. Robert Baratz to advance their malicious and destructive discreditation and orchestrated boycott campaign against Cavitat by means of the internet and false complaints of illegality or miscoding to various regulatory authorities. Cavitant contends that these acts are carefully orchestrated schemes and plans by Aetna to harass, intimidate and falsely prosecute CAVITAT owners and prospective customers and misuse State regulatory agencies to act on false information in order to improperly deny thousands of insurance claims. Cavitat contends that Aetna officials who composed CPB 642 (in-house Drs. McDonough and Koumaras) as well as Quackwatch authors Barrett, Dodes, and Quackwatch "scientific adviser" Dr. Robert Baratz conclusively determined that Aetna made no attempt to conduct any meaningful due diligence in determining the truthfulness or falsity of the factual statements about the CAVITAT ultrasound device, about NICO, or about the leading scientific authority on the disease, Dr. Jerry Bouquot, before it republished the defamatory statements from Quackwatch. Cavitat also contends that the Quackwatch authors themselves, Barrett, Dodes, and Baratz, confirmed that they had conducted no due diligence to determine the accuracy and truthfulness - or falsity - of the statements contained in the Dodes and Schissel paper. Had Aetna questioned Barrett, Dodes, Baratz, or Schissel prior to Aetna's publication of CPB 642, it would have found this out. Barrett and Dodes testified that they had never obtained permission from Dr. Schissel, the alleged co-author of the defamatory paper, to publish the Quackwatch internet version and Dr. Schissel has disassociated himself with the publication of the paper and his former dental partner, Dr. Dodes. Since the lawsuit and his deposition, Dr. Barrett has also removed the defamatory statements about Dr. Bouquot that Aetna to this day continues to publish in its CPB 642. Aetna has refused Cavitat's demands that it remove the bulletin from its website or at least 4
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restrict access from the general public. Aetna's internal communications of the Aetna officials who composed CPB 642 have been obtained through discovery by Cavitat. Those records and, more importantly, the depositions of Aetna's in-house medical officials who composed the bulletin, establish that, at the time Aetna decided it needed a bulletin on NICO and the CAVITAT ultrasound, it already had an informal policy of categorically denying any coverage for any service related to the treatment of NICO. The deposition established that rather than taking an objective look at the science, Aetna's officials searched for any publications which would justify a denial of coverage of NICO and the CAVITAT and used the only thing they could find, the Quackwatch site's crusading defamatory publication of the Dodes and Schissel paper. Ironically, the only other references cited by Aetna in its initial CPB publication were to the FDA approval of the 510(k) clearance and papers by Dr. Bouquot from scientific journals and abstracts of clinical studies which scientifically affirmed the condition of NICO and the efficacy of the CAVITAT as an oral bone imaging device. Cavitat contends that Aetna wanted to avoid in any way it could any precedence of NICO coverage as the treatment of the condition sometimes involves the removal of the teeth above the diseased bone, the removal of the diseased bone, and the insertion of implants or bridges - relatively expensive treatments for widespread dental conditions. Aetna is attempting to avoid or at least delay in any way it can - including the intellectually and scientifically dishonest statements of the bulletin and its strategy in this litigation - what could be an extremely large and permanent insurance liability to its insureds for treatment of the condition which could result in hundreds of millions of dollars in claims. It is also clear from Aetna's strategy to discredit and destroy CAVITAT's reputation and engage in this litigation that throwing a few million dollars at a strike lawsuit to intimate and defeat or delay a finding of liability is a wise investment, even though it effectively deprives its insureds and millions of other patients suffering from this serious and sometimes painful disease from receiving proper medical care and treatment. Cavitat contends that Aetna is attempting to prevent the CAVITAT from being a standard in the industry capable of providing necessary images for aiding in diagnosis and treatment of thousands of people suffering from a previously undetectable or not easily detectable medical conditions. Aetna's motive is clearly designed to prevent the CAVITAT from being in any way mainstreamed, which is something that Aetna is undoubtedly in utter panic of occurring. Cavitat will present evidence that establishes that Aetna has estimated that each diagnosis of cavitations can result in estimated claims of up to $100,000 for each claim. The main streaming of this emerging technology will have the same impact to the dental and medical field that use of glaucoma testing devices had to ophthalmology. Cavitat's insurance industry expert, Douglas R. McSwane, was a senior executive for many years with a major health insurance company (Blue Cross / Blue Shield) and in that capacity served on numerous task forces and committees that established guidelines and protocols for the insurer nationally concerning policy benefits. Mr. McSwane reviewed documents from this case, including the pleadings, Aetna's internal records surrounding the drafting and publication of CPB 642, and the deposition transcripts of CPB 642 authors Kourmaras and McDonough, and concluded that Aetna was "unfair and malicious" in its 5
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drafting of the coverage policy bulletin in its bias and lack of due diligence. He further concluded that Aetna did not comply with the standards within the insurance industry for developing such policy. The world's leading expert on NICO, Dr. Jerry Bouquot, is an oral pathologist and the Chairman of the Department of Diagnostics Sciences at the University of Texas Medical School in Houston. Dr. Bouquot has been a senior research scientist in Europe and at the Mayo Clinic and has over 200 scientific publications in peer-reviewed journals including over 40 papers on NICO and several on clinical studies involving thousands of CAVITAT ultrasounds. Dr. Bouquot is also co-author of the textbook that is used in over 90% of the oral pathology classes in American medical schools. The textbook contains a section on NICO in which the condition is described and images of the diseased condition are shown to future dentists, oral surgeons, and oral pathologists. Co-author of the textbook with Dr. Bouquot is Dr. Carl Allen, Chairman of the Oral Pathology Department at the Ohio State University College of Dentistry, who, for example, was qualified as an expert on NICO and testified as to the existence of the condition in Summerfield v. Ohio State Dental Bd., 1999 WL 3972, *2 (Ohio App. 1998). NICO is also diagnosed and treated by hundreds if not thousands of medical professionals including, prominently, Dr. Susan Zunt, Chairperson of the Department of Oral Pathology at the University of Indiana School of Dentistry, and Dr. Michael Rohrer, Director of the Division of Oral and Maxillofacial Pathology at the University of Minnesota School of Dentistry, and President of the national organization of oral pathologists, the American Academy of Oral and Maxillofacial Pathology, of which Dr. Bouquot is also a diplomat. Drs. Bouquot, Zunt, and Rohrer are plaintiff's experts on NICO and, along with the testimony of oral surgeon Dr. Wesley Shankland, Dr. Thomas Colpitts, Dr. William Glaros, radiologist Dr. Richard Kukulka, and endodontist Dr. William Adams will testify as to the existence, recognition, diagnosis, and treatment of the condition of NICO in the medical community and the scientific studies and peer-reviewed scientific publications confirming the existence of the condition. Dr. Wesley Shankland is an oral surgeon, scientific researcher, and one of the world's leading expert on the clinical use of the CAVITAT ultrasound device. Along with Dr. Bouquot, Dr. Colpitts, Dr. Glaros, and Dr. Kukulka, and others, he has presented and published scientific papers and abstracts on the use of the CAVITAT in imaging bone conditions and its use in the diagnosis of NICO and NICO-related conditions. His clinical studies have involved thousands CAVITAT images, the accuracy of which have been confirmed by biopsies examined by oral pathologist, Dr. Bouquot, and by MRIs by radiologist, Dr. Kukulka. The expert reports on the CAVITAT and its clinical significance by Drs. Shankland, Bouquot, and Kukulka are provided with this letter. The use and effectiveness of the CAVITAT as a medical imaging device is further confirmed by plaintiff's ultrasound expert, Dr. Thomas Szabo, a research scientist at the University of Boston who wrote the book on ultrasound imaging devices, after he reviewed the technology of the device, science of the diseased conditions, and examined and used the device itself. Dr. Szabo is a research scientist at the University of Boston who also wrote the textbook on ultrasound imaging devices.
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Cavitat believes that the most Aetna can show in this case is that unqualified general dentists, such as Quackwatch dentists Dodes, Schissel, and Baratz, and a few oral pathologists, such as Drs. Marx and Greer, believe that the diseased bone condition does not exist. This does not deny that there is any scientific evidence to support the existence of NICO and the effectiveness of the CAVITAT as a bone imaging device, only that the existence of NICO is disputed by some - and, certainly, that the hundreds of medical and dental professionals who engage in the diagnosis and treatment of NICO and NICO-related bone conditions, and those that use the CAVITAT, are not engaging in insurance fraud. It is not Cavitat's burden to prove the diseased condition exists or that the CAVITAT works, only that there is scientific support for the diseased oral bone condition and scientific support for the effectiveness of the CAVITAT as a bone imaging device. Cavitat has never submitted any insurance claim to Aetna or any other insurance carrier. Cavitat does not provide medical services. As of this date, Aetna has refused to produce documents that establish that insurance claims were properly denied. Aetna has avoided, at every instance, to provide all of the documents associated with its concocted allegation of fraudulent insurance claims by Cavitat. Despite its spectacular contentions of insurance wrongdoing, Aetna has not been capable of providing any evidence of Cavitat being a medical provider that has submitted insurance claims. As to Aetna's defamatory statements regarding the FDA review of the CAVITAT, Drs. Bouquot and Shankland presented extensive testimony to the FDA in the FDA review of the CAVITAT ultrasound device - including the voluminous clinical studies involving thousands of CAVITAT images. After a lengthy review, FDA approved a 510(k) clearance of the device as a device to image bone condition. Plaintiff's FDA expert, Phillip J. Phillips, has 24 years experience with the FDA, leaving the agency in 2005. Although not personally involved in the review of the CAVITAT, he was at that time a Deputy Director with the FDA Office of Device Evaluation. Mr. Phillips reviewed FDA records on the CAVITAT and concluded that, contrary to the statement of Aetna in its bulletin, "the effectiveness data submitted to the FDA was of a level generally required for a PMA application." As part of their further malicious attempts to discredit Cavitat, Aetna filed a counterclaim in this case, which was widely published by Quackwatch and throughout the internet, which falsely asserts that Drs. Bouquot and Shankland are the ring leaders in a worldwide scheme of alternative medicine fanatics to commit insurance fraud by submitting miscoded insurance claims disguising NICO-related services. Aetna names these prominent medical researchers and numerous other medical professionals - including Dr. Boyd Haley, Chairman of the Department of Chemistry at the University of Kentucky, as part of this purported insurance fraud conspiracy. Aetna's scurrilous allegations extend to the hundreds if not thousands of unnamed and prominent medical and dental professionals who diagnose and treat NICO, including Drs. Allen, Zunt, Rohrer, Colpitts, Glaros, Kukulka, Adams, and the many other co-authors of peer-reviewed scientific articles confirming the existence of NICO. The Counterclaim, even though it has been dismissed, continues to be published on the internet by Aetna's surrogates in or to create internet traffic in order to advance Aetna's boycotting campaign against Cavitat. Aetna's unproven insurance fraud allegations have been widely published by the crusading Quackwatch on the internet further decimating the market for the CAVITAT 7
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ultrasound device by frightening existing and future purchasers and users of the device that they too may be subjected to civil or even criminal charges of insurance fraud as well as potential disciplinary proceedings by state licensing boards for the diagnosis or treatment of NICO or the use of the CAVITAT. These published, unproven and scandalous allegations regarding numerous non-parties potential witnesses to this litigation have severely prejudiced and frustrated Cavitat's prosecution of its meritorious claims against Aetna - the obvious goal of Aetna's litigation strategy. Aetna has further published these scandalous insurance fraud allegations in the approximately 100 openly intimidating subpoenas duces tecum it has served on medical and dental professionals who diagnose and treat NICO, including plaintiff's experts and even the employers of plaintiff's experts, causing them great concern and distress. On damages, plaintiff's economist, Kevin H. Call, made a detailed review of the patented and FDA cleared device, its place in the medical device market, its past and its future, and determined using appropriate methods of financial evaluation that CAVITAT Medical Technologies, Inc. has suffered in the range of $61,200,000 to 72,600,000 in damages from the wrongful conduct of Aetna, plus punitive damages. Cavitat is asking the Court to order Aetna to withdraw its CPB 642 and any implication that the diagnosis and treatment of NICO-related conditions or the use of the CAVITAT ultrasound device is fraudulent or medically improper. Aetna should not be allowed to engage defamatory statements against Cavitat to justify its refusal of insurance coverage for medical conditions. Cavitat is suing Aetna for defamation, not non-coverage. For monetary damages, Cavitat seeks $72,600,000 in actual damages and $500,000,000 for future losses, plus punitive damages and its attorneys' fees and costs of this litigation. Defendants claims
4. STIPULATIONS There have been no stipulations of facts, evidence or applicability of statutes, regulations, rules or ordinances.
5. PENDING MOTIONS 1. 2. 3. 4. 5. Aetna's Motion for Summary Judgment Cavitat Motion for Summary Adjudication Aetna Motion for Entry of Dismissal Cavitat Appeal of Discovery Motion Aetna 702 Motions 8
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6.
Cross-Motion for Summary Judgment
6. WITNESSES
Plaintiff's Witnesses LAY WITNESSES WHO WILL BE PRESENT Robert J. Jones Sarah Jones CAVITAT Medical Technologies, Inc. Jerry Bouquot, DDS. MSD. William E. Shankland, II DDS, M.S., Phd. Thomas Colpitts, DDS, IMD, ND Aetna, Inc. Representative to testify about CPB 642 Representative to testify about risk analysis Representative to testify about research as to CPB 642 Representative to testify about scientific research supporting claims made in CPB 642 Risk Manager for claims relating to Cavitat Representative to testify about terms of health insurance policies governing claims that would be related to Cavitat Representative to testify about Aetna corporate earnings and revenue Representative to testify about research as to NICO by Aetna Representative to testify as to relationship between Aetna and Stephen J. Barrett, M.D. Representative to testify as to relationship between Aetna and Robert Baratz, M.D. Representative to testify as to medical review of claims relating to CAVITAT Representative to testify about CAVITAT claims Representative to testify about public relations concerning CAVITAT Representative to testify about marketing of health and dental insurance coverage of policies that would be related to coverage of Cavitat Representative that analyzed Cavitat claims Representative that analyzed NICO claims Dr. George M. Koumaras Dr. Robert J. McDonough John E. Dodes, DDS Marvin Shissell, DDS. Michael Margolis, DDS, MS, IMD MAY BE PRESENT IF NEED ARISES Robert Y. Jones Representative of University of Texas Boyd Haley, PhD 9
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Dr. Tony Lim Dr. David Rigiani, DDS. Dr. James Bronson, DDS Dr. Si Lorenzo Dr. Wayne Whitley Dr. Patel Dr. Gremmillion Thomas P. Staszak David Lutz Timothy Bolen Rick Kukulka, M.D. Wesley E. Shankland, II, DDS, MS, Phd. William Adams, DDS Edward H. Comfort, CPA Thomas H. Seal, DDS Frank R. Recker, DDS Jim Love Stephen Evans, DDS Michael R. Jackson, DDS Ada Frazier, DDS Nick Meyers, DDS Sheldon H. Katz, DDS Alex Pana, DDS Larry Bennett, DDS James Medlock, DDS David Engelsberg James Gordon Hari Palu Larry Pilot Richard H. Keller, DDS Henry Alan Gremillion, DDS Lowell Weiner, DDS, ND Michael G. Rehme, DDS Dr. Pamela Lilly, DMD Martha Cortes, DDS James Murphy, DO John Tate, DDS Robert Stephan, MS, DDS, FAFD John Laughlin, DDS Thomas Lynn Thomasson, DDS Phillip Sukel, DDS Carl Allan, DDS, MSD American Association of Endodontists American Dental Association Michael Baylin, DDS Dr. Chris Husser, DO Greg Miles Michael R. Jackson 10
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Stephen Evans, DDS Charles Brown, Esq. Bob Reeves James Turner. Esq Shane Khorrami Joe Waller, Esq.
EXPERT WITNESSES Retained Kevin Call, CPA, CVA, CFE William Glaros, DDS Rick Kukulka, MD Douglas R. McSwane, MBA, LHIC Phillip J. Phillips, MBA Dr. Michael Rohrer Thomas Sabo, Phd. Dr. Susan Zunt Donald Stout, BSES, J.D. Non-Retained Jerry Bouquot, DDS., MSD William E. Shankland, II, DDS, M.S Phd William Adams, DDS Thomas Colpitts, DDS, I.M.D., N.D.
PRESENT BY MEANS OF DEPOSITION Robert Baratz, M.D. Stephen J. Barrett, M.D. George M. Koumaras Robert J. McDonough John E. Dodes, DDS. Marvin Schissele, DDS. Aetna, Inc. Representative to testify about CPB 642 Representative to testify about risk analysis Representative to testify about research as to CPB 642 Representative to testify about scientific research supporting claims made in CPB 642 Risk Manager for claims relating to Cavitat Representative to testify about terms of health insurance policies governing claims that would be related to Cavitat 11
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Representative to testify about Aetna corporate earnings and revenue Representative to testify about research as to NICO by Aetna Representative to testify as to relationship between Aetna and Stephen J. Barrett, M.D. Representative to testify as to relationship between Aetna and Robert Baratz, M.D. Representative to testify as to medical review of claims relating to CAVITAT Representative to testify about CAVITAT claims Representative to testify about public relations concerning CAVITAT Representative to testify about marketing of health and dental insurance coverage of policies that would be related to coverage of Cavitat Representative that analyzed Cavitat claims Representative that analyzed NICO claims George M. Koumaras Robert J. McDonough John E. Dodes, DDS Marvin Shissell, DDS. Michael W. Easley, DDS Daryl Klopp, DMD J. Rodway Mackert, Jr. DMD, Phd Alvin B. Rosenblum David Wilzig Duke Essiam, RPA
Cavitat reserves right to elect to take testimony by deposition if there is time limitation.
7. EXHIBITS 1. CAVITATTM informational brochure containing the phrase "The Revolution
Has Begun" on the front cover. 2. CAVITATTM informational brochure containing the phrase "?Why? All Your
Patients Need a CAVITATTM Ultrasonograph Scan Before Implants," on the front cover. 3. 4. 5. 6. CAVITAT CAVITAT PATENT Aetna Policy Bulletin 642 Magazine article entitled "The Dirty Little Secret of the FDA and the Drug
Industry" printed in Heath Confidential for Men. 12
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7.
Article entitled "Charlatans in Dentistry: Ethics of the NICO Wars" by Jerry
E. Bouquot, DDS, MSD, FICD, FADI, and Robert E. McMahon, DDS, published in Journal of the American College of Dentists, Volume 70, Number 3, 2003, "Quackery and Fraud." 8. Article entitled, "Implant failures associated with asymptomatic
endodontically treated teeth," authored by David L. Brisman, DMD.; Adam S. Brisman, DMD., and Mark S. Moses, DDS, printed in JADA, Vol. 132, February 2001. 9. Five-page document entitled "CAVITATTM update from Mr. Robert "Bob"
Jones, president of CAVITATTM Medical Technologies, Inc." 10. Four-page document entitled "Abstracts of Independent, Peer Reviewed,
Published Research." 11. Seven-page document containing cover-page and excerpt from a book entitled
"Pathways of the Pulp, Sixth Edition" edited by Stephen Cohen, and Richard C. Burns. 12. Thirty-six page article entitled, "Accurate Detection of Jawbone Lesions and
Osteolytic Abnormalities Using the CAVITATTM Ultrasonogram Imaging System: Clinical Study Utilizing Photoaffinity Labeling and Histological Assessments," authored by Michael D. Margolis, DDS, MS, IMD. 13. Unpublished article entitled "Quantitative Ultrasound (QUS) of Alveolar
Bone Low Proportion of False Positives Among 4,120 Scanned Sites," written by Jerry E. Bouquot, DDS, MSD; Wesley E. Shankland II, DDS, MS, PhD; Michael Margolis, DDS, DIM; Jacques Imbeau, DMD; William Glaros, DDS. 14. Article published in Journal of Carniomandibular Practice, October 2002,
Volume 20, Number 4, entitled: "Medullary and Odontogenic Disease in the Painful Jaw: Clinicopathologic Review of 500 Consecutive Lesions," written by Wesley E. Shankland, II, D.D.S., M.S., Ph.D. 13
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15.
Article published in Compendium of Continuing Education in Dentistry, May
2004, Volume 25, No. 5., entitled "Understanding the Limitations of Dental Radiographs," by Cary Shapoff, DDS. 16. Twenty-four page excerpt from "Oral & Maxillofacial Pathology, 2nd Ed.,"
written by Brad Neville, et al. 17. Article entitled "Mouth Body Connection" posted on American Academy of
Periodontology website. www.perio.org/consumer/mbc.top2.htm. 18. Fourteen-page document entitled "Ischemic Bone Disease of the Maxillofacial
Region: A Listing of Published Literature," dated February 2004. 19. Article published in Skeptical Inquirer July, 2001, entitled, "Junk Science and
the Law," by John E. Dodes. 20. Article published on the Quackwatch Home Page entitled "CAVITATional
Osteopathosis, NICO, and "Biological Dentistry," by John E. Dodes, DDS, and Marvin Schissel, DDS. 21. Article entitled "The Road to Health...Using `The Clark Method'
Newsletter," by Bonnie O'Sullivan, dated July/August 2001 posted on http://road-tohealth.com. 22. Article entitled "Frequently Asked Questions About CAVITATions," posted
on http://road-to-health.com. 23. 24. M.S., Ph.D." 25. M.S.D." 14 Twenty-page document entitled "Curriculum Vitae, J.E. Bouquot, D.D.S., Consumer Health Digest # 03-29 dated July 22, 2003. Six-page document entitled "Biography of Wesley Shankland, II, B.S., D.D.S,
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26.
Two-page document entitled "Maxillofacial Osteonecrosis (NICO) Dr.
Bouquot's published work." 27. 28. 29. 29, 2000. 30. Documents relating to United States Patent number 6,700,075 B2, dated Biography of Stephen Barrett, M.D. from the Quackwatch website. Curriculum Vitae of Stephen Barrett, M.D. from the Quackwatch website. Documents relating to United States Patent number 6,030,221, dated February
March 2, 2004. 31. 32. 33. 34. Documents relating to Canadian patent of CAVITATTM. Documents relating to FDA approval of CAVITATTM. Documents relating to European Commonwealth clearance of CAVITATTM. Notification from Health Canada changing the risk classification of the
CAVITATTM Generation 4 TTAS from 2 to 3 on its Medical Device Licence issued to CAVITATTM Medical Technologies, Inc, on July 8, 2002.
35.
Letter dated February 15, 2002 from United States Department of Health &
Human Services to Mr. Larry Pilot authorizing CAVITATTM Medical Technologies, Inc. to market the CAVITATTM as described in their Section 510(k) premarket notification. 36. Document entitled "EMC Qualification Test Report," reporting emissions and
immunity test data for the CAVITATTM Medical Technology Generation 4, CAV40000, issued on March 27, 2002. 37. Report entitled "Preliminary Indication of Value" produced by IPA Advisory
& Intermediary Services, LLC evaluating the value of CAVITATTM Medical Technologies, Incorporated. 15
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38.
Clinical Policy Bulletins posted on Aetna website discussing NICO and
CAVITATTM Ultrasonography, including, but not limited to:
a) Clinical Policy Bulletin posted August 20, 2002. b) Clinical Policy Bulletin posted March 18, 2003. c) Clinical Policy Bulletin posted January 13, 2004. d) Clinical Policy Bulletin posted April 20, 2004.
39. 40. 41.
Document entitled "Sample Medical Insurance Codes." Document entitled "Sample Dental Insurance Codes." Letter from Aetna Inc. representative, Sheila Creamier, denying Aetna
coverage to Paul Crabtree, dated June 21, 2004. 42. Letter from Bob Jones to M. Mazhar Said, Ph.D., Assistant Director of the
ADA Acceptance Program, dated May 29, 2002 beginning with the phrase "Enclosed are some of the research data." 43. Letter from Bob Jones to M. Mazhar Said, Ph.D., Assistant Director of the
Acceptance Program, dated May 29, 2002, beginning with the phrase "Pursuant to your phone call of today..." 44. Letter from Bob Jones to Michael Siegal, D.D.S., M.S., Chairman of Counsel
Scientific Affairs for the American Dental Association, dated March 25, 2003. 45. Letter from Betty Howard, L.P.N. to Wesley E. Shankland, II, D.D.S., dated
November 7, 2002. 46. 8, 2003. 16 Letter from Michael Siegal, D.D.S., M.S. of the ADA to Bob Jones dated May
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47. 48. 49.
Letter from John Stasic, DMD, to Dr. Frazier, dated July 7, 2003. Documents relating to policy positions and statements by the ADA. Transcripts from Informal Hearing of Arizona Board of Examiners'
Investigation of Dr. Michael D. Margolis on February 13, 2004. 50. Transcript of proceedings of Board of Dental Examiners Board Meeting re:
Dr. Michael Margolis, DDS, Case No. 230151 on April 2, 2004. 51. Continuing education documentation showing CAVITATTM as an approved
source of dental continuing education by the Academy of General Dentistry. 52. Insurance reimbursement papers for CAVITATTM use by Met Life Insurance.
Letter from Dr. Michael Margolis, DDS, entitled "Request to Dismiss Arizona Board of Examiner Complaint #230151, dated March 18, 2004. 53. Consumer Health Digest # 02 -41, Weekly Update of News and Reviews,
dated October 8, 2002. 54. 55. 56. 57. Letter from John Ahearne, BDS, dated May 10, 2004. Letter from Ray G. Behm Jr., DDS, dated April 23, 2004. Letter from Dr. Pieter Boshoff, dated July 5, 2004. Letter (with attached documents) from Dr. John Cline, MD, and Dr. Peter
Brawn, DDS, dated May 5, 2004. 58. 59. 60. 61. 62. 63. Letter from G. Thomas Colpitts, DDS, ND, dated May 5, 2004. Letter from William P. Glaros, DDS, dated April 23, 2004. Letter from Michael R. Jackson, DDS, dated April 28, 2004. Letter from Richard H. Keller, DDS, MPS, dated April 22, 2004. Letter from R. Andrew Landerman, DDS, dated April 23, 2004. Letter from John D. Laughlin III, DDS, dated April 28, 2004. 17
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64. 65. 66. 67. 68. 69. 70. 71. 72.
Letter from James B. Lewer, DDS, ND, dated April 25, 2004. Letter from Terrence A. Messerman, DDS, dated May 3, 2004. Letter from Dr. Nicholas Meyer, DDS, dated May 3, 2004. Letter from Alexander Pana, DDS, dated May 25, 2004. Letter from Wesley E. Shankland, II, DDS, MS, Ph.D., dated April 27, 2004. Letter from Robert B. Stephan, dated April 28, 2004. Letter from Dr. Andrew Taylor BDC, FACNEM(Dent), dated August 1, 2004. Letter from Byung Sun Yoo, DDS, dated May 12, 2004. Documents posted on the Quackwatch organization's website at
www.quackwatch.org. 73. Documents posted on Dental Watch website www.dentalwatch.org, operated
by Stephen Barrett, MD and Robert Baratz, MD, DDS; and John Dodes, DDS. 74. Documents posted on Device Watch website www.devicewatch.org operated
by Stephen Barrett, MD and Robert Baratz, MD, DDS; and John Dodes, DDS. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. Interrogatories Propounded by Cavitat Response by Aetna to Interrogatories of Cavitat Request for Productions of Documents Propounded by Cavitat Responses by Aetna to Cavitat Requests for Productions of Documents Aetna First Amended Cross-Complaint Subpoenas served by Aetna Answer of Aetna Documents relied upon by experts Documents relied upon by Kevin Call in support of opinion Documents relied upon by William Glaros in support of opinion 18
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85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100. AAE055 101. 102. 103. 104. 105. 106. 107.
Documents relied upon by Rick Kukulka, MD in support of opinion Documents relied upon by Douglas McSwane, MBA, in support of opinion Documents relied upon by Phillip J. Phillips in support of opinion Documents relied upon by Dr. Michael L. Rohrer in support of opinion Documents relied upon by Thomas Szabo, Phd in support of opinion Documents relied upon by Dr. Susan Zunt in support of opinion Documents relied upon by Donald Stout in support of opinion www.quackwatch.org website www.dentalwatch.org website Deposition of Robert Baratz Deposition of Stephen Barrett Deposition of Robert McDonough Deposition of George M. Koumaras Deposition of John E. Dodes Deposition of Marvin J. Schisell American Association of Endodentists Documents - Bates AAE0055.1 to
American Dental Association Documents - Bates ADA00000.1 to 000994 Aetna Documents - Bates A0000001 to A004390 and A000001 to A005548 Documents of Dr. Marx Documents of Dr. Kuzatz FDA Documents - Bates 01611 to FDA 02191 Cavitat Documents - Bates 007165 to 007528 Margolis Documents - Bates CAV_Margolis000001 to 001274 19
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108. 109.
Patent Documents - Cav_Patent 0003 to 00280 Shankland Documents - Bates Shankland0000.1 to 0435 and
CAVSHANKLAND00001 to 00167 110. 111. 112. Dental Help documents - Bates 00001-27 Stockton Documents 00001-3 Aetna claims files not yet produced
8. DISCOVERY
Discovery cut-off was February 1, 2006, however several depositions are still pending and are anticipated to be completed by early May, 2006.
There are still discovery motions pending and Cavitat anticipates filing additional motions based upon non-compliance of discovery orders by Aetna.
9. SPECIAL ISSUES
1. 2.
Cavitat anticipates filing 702 Motions as to Aetna experts Cavitat anticipates filing pre-trial motions in limine
10. SETTLEMENT
a.
Counsel for Aetna and prior counsel for Cavitat had telephone discussions 20
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about settlement which were not fruitful. There have been no settlement discussions between Cavitat's new counsel and Aetna's counsel.
b.
A Settlement Conference had been scheduled for December 7, 2005 but was
cancelled sua sponte by Magistrate Schlater on November 30, 2005.
c. counsel.
The parties were promptly informed of all offers of settlement with prior
d.
Counsel for Cavitat has written the Court asking that a Settlement Conference
be re-scheduled. Aetna has not stated its position with respect to a settlement conference
e.
It appears from the discussion by all counsel that there is third party
intervention would be necessary if settlement is to be discussed. Cavitat has followed the Court's suggestion in making advances toward settlement.
f.
There is no new Settlement Conference date scheduled nor has there been any
Alternative Dispute Resolution been accepted by Aetna.
g.
Counsel for the parties considered ADR in accordance with
D.C.COLO.LCivR.16.6 with prior counsel.
h.
Counsel for Cavitat has proposed that a Settlement Conference with a third
party could be beneficial and invited. 21
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11. OFFER OF JUDGMENT
Hereafter, this Final Pretrial Order will control the subsequent course of this action and the trial, and may not be amended except by consent of the parties and approval of the court or by order of the court to prevent manifest injustice. The pleadings will be deemed merged herein. This Final Pretrial Order supersedes the Scheduling Order. In the event of ambiguity in any provision of this Final Pretrial Order, reference may be made to the record of the pretrial conference to the extent reported by stenographic notes and to the pleadings.
13. TRIAL AND ESTIMATED TRIAL TIME, FURTHER TRIAL PREPARATION PROCEEDINGS
The Court has indicated that the trial should be one week.
1.
Counsel for Cavitat estimates that it can present its case in 20 hours of court time, excluding jury selection and pre-trial and pre-verdict motions;
2. 3.
Trial is to be by jury, Trial is to be in Denver
22
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DATED this _____ day of _________________, 200__.
BY THE COURT:
_______________________________________ United States Judge
APPROVED:
________s/ Carlos F. Negrete___ Carlos F. Negrete LAW OFFICES OF CARLOS F. NEGRETE 27422 Calle Arroyo San Juan Capistrano, CA 92675-2747 Telephone: (949) 493-8115 Fax: (949) 493-8170 e-mail: [email protected] Attorney for Plaintiff, CAVITAT MEDICAL TECHNOLOGIES, INC.
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