Labs In Court

Can Lab Suing Vendor for Defective MS Equipment Change Its Legal Theory at the Last Minute?

Case: A Brooklyn medical lab purchased turn-key mass spectrometry equipment and support services from a New Jersey vendor for $534,000 so it could begin providing clinical toxicology services. But kinks in the equipment/service package caused the lab to fail its initial Proficiency Tests with the New York Department of Health and sued the vendor for conspiracy, fraud and falsely misrepresenting the capabilities of the package. Five years into the litigation with the discovery completed and the case set to go to trial, the lab wanted to add a new claim to its complaint: breach of contract. The vendor cried foul, noting that this was the third time the lab had changed its legal case; but the New York federal court shrugged off the vendor’s objections and let the lab amend its claim.

Significance: The new claim would delay the trial, the court acknowledged, but it wouldn’t be an “undue delay” or cause the vendor “undue prejudice.” A lot of extra discovery wouldn’t be necessary given how frequently issues of contract had already been addressed during the previous depositions, the court reasoned. And the breach of contract claim wouldn’t be futile since it had sufficient merit and would probably survive a motion to dismiss, the court concluded [Lenco Diagnostic Labs., Inc. v. McKinley Sci., Inc., 2020 U.S. Dist. LEXIS 119922, 2020 WL 3840562].

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