Value Health Sols. Inc. v. Pharm. Rsch. Assocs., Inc.

Value Health Sols. Inc. v. Pharm. Rsch. Assocs., 2025 NCBC 34.

STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
COUNTY OF WAKE 18-CVS-12318

VALUE HEALTH SOLUTIONS
INC. and NEIL RAJA,

Plaintiffs,

v. ORDER AND OPINION ON
PLAINTIFFS’ MOTION TO STRIKE
AND DEFENDANTS’ MOTION FOR
PHARMACEUTICAL PARTIAL SUMMARY JUDGMENT
RESEARCH ASSOCIATES, INC.
and PRA HEALTH SCIENCES,
INC.,

Defendants.

THIS MATTER is before the Court on Plaintiffs Value Health Solutions Inc.

(“VHS”) and Neil Raja’s (collectively, “Plaintiffs”) Motion to Strike Defendants’

Statute of Limitations Defense Under Rule 12(f) and/or Rule 12(c) (“Motion to Strike,”

ECF No. 214), and Defendants Pharmaceutical Research Associates, Inc. and PRA

Health Sciences, Inc.’s (collectively, “PRA” or “Defendants”) Motion for Summary

Judgment and Partial Summary Judgment Pursuant to Rule 56(b) (“Motion for

Summary Judgment,” ECF No. 218, and together with the Motion to Strike, the

“Motions”).

THE COURT, having considered the Motions, the briefs and submissions of

the parties, the arguments of counsel, and all appropriate matters of record,

CONCLUDES that the Motion to Strike should be DENIED and the Motion for
Summary Judgment should be GRANTED in part and DENIED in part, for the

reasons set forth below.

Guidry Law Firm PLLC, by David Glen Guidry, for Plaintiffs.

Parker Poe Adams & Bernstein LLP, by John Moye and Jack
K. Belk, for Defendants.

Davis, Judge.

FACTUAL AND PROCEDURAL BACKGROUND

1. As the Court has summarized on several prior occasions, this lawsuit

involves a dispute between the parties in connection with PRA’s acquisition of VHS

(the “Acquisition”) and its proprietary software (“PSO”). 1 The Plaintiffs in this action

are VHS and its founder, Raja. Value Health Sols., Inc. v. Pharm. Rsch. Assocs., 2024

NCBC LEXIS 140, at *2 (N.C. Super. Ct. Nov. 6, 2024).

2. Plaintiffs filed their original Complaint on 5 October 2018. (ECF No.

5.) Since that time, this case has followed a lengthy and procedurally complicated

path, which is more thoroughly summarized in prior opinions of this Court and the

North Carolina Supreme Court. See Value Health Sols., Inc. v. Pharm. Rsch. Assocs.,

385 N.C. 250 (2023); Value Health Sols., 2024 NCBC LEXIS 140, at *2–3; Value

Health Sols., Inc. v. Pharm. Rsch. Assocs., 2021 NCBC LEXIS 37, at *2–4 (N.C. Super.

Ct. Apr. 5, 2021); Value Health Sols., Inc. v. Pharm. Rsch. Assocs., 2020 NCBC LEXIS

65, at *1–14 (N.C. Super. Ct. May 22, 2020).

1 Over the course of this litigation, both this Court and our Supreme Court have at various

points referred to this proprietary software as the “Solutions.” In this Opinion, however, the
Court will instead refer to it as “PSO” as the parties do in their briefs.
3. On 22 May 2020 and 6 April 2021, the Court entered Orders

dismissing certain claims asserted by Plaintiffs and ultimately granting summary

judgment as to all of Plaintiffs’ remaining claims. See Value Health Sols., 2020

NCBC LEXIS 65, at *37–39; Value Health Sols., 2021 NCBC LEXIS 37, at *83–84.

4. On 23 October 2021, Plaintiffs appealed this Court’s rulings to the North

Carolina Supreme Court. (ECF No. 153.)

5. On 21 September 2023, the Supreme Court affirmed all but one of this

Court’s rulings. Specifically, the Supreme Court reversed this Court’s entry of

summary judgment against Plaintiffs on the issue of PRA’s alleged breaches of

Sections 2.6(a)(iv)–(vii) and 2.6(b) of the parties’ Asset Purchase Agreement (“APA,”

ECF No. 201.1) (the “Remanded Claim”) and remanded that claim for further

proceedings. See Value Health Sols., 385 N.C. at 282–83.

6. Section 2.6(a) of the APA provides for a series of seven “Milestones,”

each of which corresponds to PRA’s completion of either (i) a particular phase of its

efforts to fully integrate PSO into its existing internal systems (the “Internal

Development Milestones”) in the aftermath of the Acquisition; or (ii) “External Sales”

of PSO to third parties at various defined dollar amounts (the “External Sales

Milestones”). Upon the completion of each Milestone, PRA was required to pay VHS

a specified amount in accordance with the terms of that Milestone. (APA § 2.6(a).)

7. Section 2.6(a) of the APA reads as follows:

(a) Milestones. As additional consideration for the transactions
contemplated hereby, and subject to the terms of this Section 2.6,
[PRA] shall make (or [PRA Health Sciences] shall make on [PRA’s]
behalf) the following payments (each, a “Contingent Payment”):
i. upon completion of the integration of the parties’ Salesforce™
environments set forth on Schedule 2.6(a)(i), [PRA] shall
issue to [VHS] (or as otherwise directed by [VHS’s]
Representative), within thirty (30) days after such
completion, that number of shares of PRA Common Stock
equal in value to Three Hundred Thirty-Three Thousand U.S.
Dollars ($333,000.00), based on the Fair Market Value as of
the date of issuance of such shares; provided, however, that
completion occurs within the first consecutive eighteen (18)
months from the Effective Time (the “Integration Period”);

ii. upon completion of the key product enhancements set forth
on Schedule 2.6(a)(ii), [PRA] shall issue to [VHS] (or as
otherwise directed by [VHS’s] Representative), within thirty
(30) days after such completion, that number of shares of PRA
Common Stock equal in value to Three Hundred Thirty-Three
Thousand U.S. Dollars ($333,000.00), based on the Fair
Market Value as of the date of issuance of such shares;
provided, however, that completion occurs within the
Integration Period;

iii. upon completion of the migration of the clinical trial
management systems studies of [PRA] and its Affiliates into
ClinTrial Max as set forth on Schedule 2.6(a)(iii), [PRA] shall
issue to [VHS] (or as otherwise directed by [VHS’s]
Representative), within thirty (30) days after such
completion, that number of shares of PRA Common Stock
equal in value to Three Hundred Thirty-Three Thousand U.S.
Dollars ($333,000.00), based on the Fair Market Value as of
the date of issuance of such shares; provided, however, that
completion occurs within the Integration Period;

iv. upon the achievement of aggregate External Sales equal to
Twenty[-]Five Million U.S. Dollars ($25,000,000), [PRA] shall
make, within thirty (30) days following the date on which
[PRA] files its next quarterly report with the United States
Securities and Exchange Commission (the “SEC”) after such
achievement, a cash payment of Two Million Five Hundred
Thousand U.S. Dollars ($2,500,000.00) to [VHS] (or as
otherwise directed by [VHS’s] Representative) (the “First
Milestone Payment”); provided, however, that such
achievement occurs prior to the second (2nd) anniversary of
the Closing Date (the “First Milestone Period”);
v. upon the achievement of aggregate External Sales equal to
Fifty Million U.S. Dollars ($50,000,000.00), [PRA] shall make,
within thirty (30) days following the date on which [PRA] files
its next quarterly report with the SEC after achievement, a
cash payment of Five Million U.S. Dollars ($5,000,000.00) to
[VHS] (or as otherwise directed by [VHS’s] Representative)
(the “Second Milestone Payment”); provided, however, that
such achievement occurs prior to the third (3rd) anniversary
of the Closing Date (the “Second Milestone Period”);

vi. upon the achievement of aggregate External Sales equal to
Seventy[-]Five Million U.S. Dollars ($75,000,000.00), [PRA]
shall make, within thirty (30) days following the date on
which [PRA] files its next quarterly report with the SEC after
achievement, a cash payment of Seven Million Five Hundred
Thousand U.S. Dollars ($7,500,000.00) to [VHS] (or as
otherwise directed by [VHS’s] Representative) (the “Third
Milestone Payment”); provided, however, that such
achievement occurs prior to the fourth (4th) anniversary of the
Closing Date (the “Third Milestone Period”); and

vii. for four (4) consecutive calendar years following the
achievement of aggregate External Sales equal to Seventy-
Five Million U.S. Dollars ($75,000,000.00) (the “Major
Milestone”, and the date on which the Major Milestone is
achieved, the “Major Milestone Date”), [PRA] shall make,
within thirty (30) days following the date on which [PRA] files
its next quarterly report with the SEC after each of the four
(4) anniversaries of the Major Milestone Date, a per annum
royalty payment to [VHS] (or as otherwise directed by [VHS’s]
Representative) equal to one percent (1%) of the aggregate
amount of External Sales made during the applicable
calendar year (such payments, the “Royalty Payments”). For
the avoidance of doubt, any such Royalty Payments shall be
made regardless of whether the First Milestone Payment, the
Second Milestone Payment and/or the Third Milestone
Payment have previously been made[.]

(APA §§ 2.6(a)(i)–(vii).)
8. Section 2.6(b) of the APA provides that each of the seven Milestones in

Section 2.6(a) are independent and may not be conditioned upon one another. This

provision reads as follows:

[PRA’s] obligation to pay the Contingent Payments to [VHS] (or as
otherwise directed by [VHS’s] Representative) in accordance with
Section 2.6(a) is an independent obligation of [PRA] and is not otherwise
conditioned or contingent upon the satisfaction of any conditions
precedent to any preceding or subsequent Contingent Payment and the
obligation to pay a Contingent Payment to [VHS] (or as otherwise
directed by [VHS’s] Representative) shall not obligate [PRA] to pay any
preceding or subsequent Contingent Payment. For the avoidance of
doubt and by way of example, if the conditions precedent to the payment
of the First Milestone Payment for the First Milestone Period are not
satisfied, but the conditions precedent to the payment of the Second
Milestone Payment for the Second Milestone Period are satisfied, then
[PRA] would be obligated to pay such Second Milestone Payment for the
Second Milestone Period for which the corresponding conditions
precedent have been satisfied, and not the First Milestone Payment for
the First Milestone Period.

(APA § 2.6(b).)

9. On 26 October 2023, this Court entered a Supplemental Case

Management Order, (“Suppl. CMO,” ECF No. 166), which set forth parameters for

additional discovery on certain issues identified by the Supreme Court with respect

to the Remanded Claim. The Supplemental CMO also required the parties to seek

leave of Court prior to filing any new motions for summary judgment. (Suppl. CMO

¶ (IV)(B)(4).)

10. After nearly a year of supplemental discovery, Defendants filed a

motion seeking such authorization on 14 October 2024, (“Motion for Leave,” ECF No.

199), in which they sought the Court’s permission to file a motion for summary
judgment on three discrete issues. 2 The Court subsequently entered an Order

granting the Motion for Leave on 27 January 2025. (ECF No. 211.)

11. On 24 February 2025, Plaintiffs filed the Motion to Strike, which

requests that the Court enter an order striking Defendants’ affirmative defense based

on the statute of limitations, which—as discussed in more detail below—serves as

one of the bases for Defendants’ Motion for Summary Judgment.

12. Defendants filed the Motion for Summary Judgment on 10 March 2025.

13. First, Defendants seek partial summary judgment on the issue of

whether the statute of limitations bars Plaintiffs from asserting that PRA breached

Section 2.6(b) of the APA by improperly conditioning completion of “External Sales”

of PSO upon satisfaction of one or more of the APA’s Internal Development

Milestones.

14. Second, Defendants argue that they are entitled to summary judgment

on the issue of whether an agreement signed between PRA and a third-party, Takeda

Pharmaceuticals (“Takeda”)—the Takeda Master Services Agreement (“Takeda

MSA,” ECF No. 221.6)—constituted an “External Sale” under the APA.

15. Third, Defendants seek summary judgment on the issue of whether

PRA’s internal use of PSO to perform clinical trial services for its customers

constitutes an “External Sale” under the APA.

2 One of these issues was based on Defendants’ contention that a portion of Plaintiffs’ claim

for breach of Section 2.6(b) was barred by the statute of limitations.
16. Both Motions have now been fully briefed and came on for a hearing on

24 June 2025 at which all parties were represented by counsel. The Motions are now

ripe for resolution.

LEGAL STANDARD

17. It is well established that “[s]ummary judgment is proper ‘if the

pleadings, depositions, answers to interrogatories, and admissions on file, together

with the affidavits, if any, show that there is no genuine issue as to any material fact

and that any party is entitled to a judgment as a matter of law.’” Morrell v. Hardin

Creek, Inc., 371 N.C. 672, 680 (2018) (quoting N.C. R. Civ. P. 56(c)). “[A] genuine

issue is one which can be maintained by substantial evidence.” Kessing v. Nat’l

Mortg. Corp., 278 N.C. 523, 534 (1971). “Substantial evidence is such relevant

evidence as a reasonable mind might accept as adequate to support a conclusion and

means more than a scintilla or a permissible inference.” Daughtridge v. Tanager

Land, LLC, 373 N.C. 182, 187 (2019) (cleaned up).

18. On a motion for summary judgment, “[t]he evidence must be considered

‘in a light most favorable to the non-moving party.’” McCutchen v. McCutchen, 360

N.C. 280, 286 (2006) (quoting Howerton v. Arai Helmet, Ltd., 358 N.C. 440, 470

(2004)). “[T]he party moving for summary judgment ultimately has the burden of

establishing the lack of any triable issue of fact.” Pembee Mfg. Corp. v. Cape Fear

Constr. Co., 313 N.C. 488, 491 (1985).

19. The party moving for summary judgment may satisfy its burden by

proving that “an essential element of the opposing party’s claim does not exist, cannot
be proven at trial, or would be barred by an affirmative defense, . . . or by showing

through discovery that the opposing party cannot produce evidence to support an

essential element of [the] claim[.]” Dobson v. Harris, 352 N.C. 77, 83 (2000). “If the

moving party satisfies its burden of proof, then the burden shifts to the non-moving

party to ‘set forth specific facts showing that there is a genuine issue for trial.’” Lowe

v. Bradford, 305 N.C. 366, 369–70 (1982) (quoting N.C. R. Civ. P. 56(e)). If the

nonmoving party does not satisfy its burden, then “summary judgment, if

appropriate, shall be entered against [the nonmovant].” United Cmty. Bank (Ga.) v.

Wolfe, 369 N.C. 555, 558 (2017) (quoting N.C. R. Civ. P. 56(e)).

20. Rule 12(f) provides that a court “may order stricken from any pleading

any insufficient defense[.]” N.C. R. Civ. P. 12(f). The purpose of the Rule is to “avoid

expenditure of time and resources before trial by removing spurious issues, whether

introduced by original or amended complaint.” Estrada v. Jaques, 70 N.C. App. 627,

642 (1984). Ultimately, a motion to strike “is addressed to the sound discretion of the

trial court[.]” Broughton v. McClatchy Newspapers, Inc., 161 N.C. App. 20, 25 (2003).

ANALYSIS

I. Statute of Limitations

21. Defendants contend that Plaintiffs’ claim for breach of Section 2.6(b) of

the APA is barred, in part, by the applicable statute of limitations.

22. As an initial matter, Plaintiffs argue that Defendants’ invocation of the

statute of limitations as an affirmative defense should be stricken on the ground that

the defense was not pled with the requisite specificity. See N.C. R. Civ. P. 8(c)
(pleadings of affirmative defenses must contain “a short and plain statement of any

matter constituting an avoidance or affirmative defense sufficiently particular to give

the court and the parties notice of the transactions, occurrences, or series of

transactions or occurrences, intended to be proved”).

23. A Rule 12(f) motion to strike tests “the legal sufficiency of an affirmative

defense,” and “the requirements for pleading a defense are no more stringent than

the requirements for pleading a claim for relief.” Lineage Logistics, LLC v. Primus

Builders, Inc., 2024 NCBC LEXIS 31, at **9 (N.C. Super. Ct. Feb. 23, 2024) (cleaned

up).

24. Defendants first asserted the statute of limitations defense in their

Answer filed on 2 December 2019 by stating: “Some or all of Plaintiffs’ claims are

barred by the statute of limitations, including Plaintiffs’ fraud-based claims.” (ECF

No. 76, at 15.)

25. Plaintiffs argue that this statement—by itself—did not provide them

with sufficient notice of Defendants’ intent to raise the statute of limitations because

it is “a single, conclusory sentence, devoid of facts.” (Pls.’ Br. Supp. Mot. Strike, at 4,

ECF No. 215.)

26. Although the better practice would have been for Defendants to provide

more detail in their affirmative defense as to how specifically the statute of

limitations affected Plaintiffs’ claims, we note that our Court of Appeals has held

(albeit in an unpublished opinion) that a similarly succinct articulation of a statute

of limitations defense satisfied North Carolina’s notice pleading standard. See Babb
v. Graham, 2005 N.C. App. LEXIS 1219, at *22 (2005) (unpublished). In Babb, the

Court of Appeals determined that the bare assertions that “‘the application of the

Statute of Limitations . . . would serve as a bar to any of’ the claims against

[defendant]” and that “any other claims against [defendant] were ‘barred by the

applicable’ statutes of limitations” sufficed to “put the parties on notice that the

timing of the potential claims was an issue.” Id.

27. Moreover, under the circumstances presented in this case, the Court is

unable to find that Plaintiffs will be unfairly prejudiced if Defendants are allowed to

pursue this defense. After all, Plaintiffs have been on notice of this defense for over

five years. 3 During those years, Plaintiffs never put Defendants on notice of their

contention that the defense had been insufficiently pled so as to give Defendants an

opportunity to seek leave of court to amend their pleading to provide more specificity.

28. For these reasons, Plaintiffs’ Motion to Strike is DENIED, and the

Court now turns to the merits of Defendants’ summary judgment argument on this

issue. 4

29. The relevant limitations period for a breach of contract claim is three

years. Sparrow Sys. v. Priv. Diagnostic Clinic, PLLC, 2014 NCBC LEXIS 70, at *31

(N.C. Super. Ct. Dec. 24, 2014) (“In general, an action for breach of contract must be

3 Additionally, the issue was fully briefed before the Supreme Court, although the Supreme

Court ultimately opted not to rule on that issue.

4 For these same reasons, Plaintiffs’ request for judgment on the pleadings on this issue

pursuant to Rule 12(c) is also DENIED.
brought within three years from the time of the accrual of the cause of action.”

(cleaned up)); see also N.C.G.S. § 1-52(1).

30. “[The] statute of limitations does not begin to run until the plaintiff has

actual or constructive notice of the defendants’ wrongful acts.” Trail Creek Invs. LLC

v. Warren Oil Holding Co., 2023 NCBC LEXIS 70, at **25 (N.C. Super. Ct. May 9,

2023).

31. Defendants contend that Raja first learned of Defendants’ efforts to

improperly condition the External Sales Milestones (instead of immediately seeking

to pursue External Sales of PSO following the Acquisition) through a conversation he

had with PRA’s Chief Executive Officer, Colin Shannon, back in June 2015.

32. Raja testified that, during this conversation, Shannon told him: “Neil,

let’s just focus on getting [PSO] internally done, you know, smoke tested, and then

we will go sell it, just focus on that.” (2019 VHS Dep., at 79, ECF No. 201.11.)

33. According to Raja, this comment “made [it] clear” that Shannon

“want[ed] . . . to focus internally” and “to stop external sales [of PSO] until [PRA went]

live with [PSO].” (Raja Dep., at 294, ECF No. 221.1.)

34. In explaining his comments, Shannon testified that he was aware of

“substantial gaps” in PSO’s initial capabilities and believed that PRA needed PSO to

be fully integrated into PRA’s own systems “first so that [PRA] could then take it to

market.” (Shannon Dep., at 93, ECF No. 221.3.)5

5 When asked whether he thought “it was reasonable for [Raja] to believe [that] he could start

selling VHS’s software solutions from the moment he joined PRA[,]” Shannon testified that
“[i]t would have been very foolhardy for him to ever think that. [PRA] could have been sued.
35. Raja testified that he was “shocked” at the news of this “bombshell” from

Shannon, which he interpreted to mean that “[external] sales milestones [could not]

be pursued until [the] internal milestones [were] done[.]” (2019 VHS Dep., at 79,

175.) Nevertheless, Raja continued to believe that External Sales of PSO were

achievable and that PSO was an “essential” component to PRA’s upcoming

transaction with Takeda. (See Pls.’ Resp. Defs.’ Mot. Summ. J., Ex. U, ECF No.

125.22; Shannon Dep., at 110–13, ECF No. 229.2; Raja Dep., at 345–48, ECF No.

229.4; Jones-Herzog Dep., at 188–96, ECF No. 229.5.) Likewise, Raja testified that

he felt PRA was cooperating with him during this time period by actively making

efforts to amend the APA’s milestones. (Raja Dep., at 334–40, 345–48, ECF No.

229.4.)

36. The Court is of the view that to the extent Shannon’s June 2015

comments to Raja were sufficient to give rise to a claim for breach of PRA’s obligations

under Section 2.6(b) at that time, the claim would be based on a theory of anticipatory

repudiation.

37. The parties disagree over whether North Carolina law or Delaware law

should govern the Court’s analysis on the statute of limitations issue. Plaintiffs

assert that because Delaware’s substantive laws apply to the breach of contract

claim, 6 the laws of that state should also govern the issue of determining when

[PRA’s] reputational damage would have been enormous if [it] installed something that [did]
not meet the needs [of its customers].” (Shannon Dep., at 109.)

6 Section 8.7 of the APA provides that the agreement “shall be governed by and construed

and enforced in accordance with the internal laws of the State of Delaware without giving
effect to the principles of conflicts of law thereof.” (APA § 8.7.)
Plaintiffs’ cause of action accrued for purposes of the statute of limitations.

Defendants, conversely, assert that because the statute of limitations is properly

characterized as procedural rather than substantive, North Carolina law should

apply to that issue.

38. However, the Court need not address the choice-of-law issue because the

laws of North Carolina and Delaware are essentially identical concerning

anticipatory repudiation.

39. North Carolina courts define anticipatory repudiation as follows:

Repudiation is a positive statement by one party to the other party
indicating that he will not or cannot substantially perform his
contractual duties. When a party repudiates his obligations under the
contract before the time for performance under the terms of the contract,
the issue of anticipatory breach or breach by anticipatory repudiation
arises. One effect of the anticipatory breach is to discharge the non-
repudiating party from his remaining duties to render performance
under the contract.

Profile Invs. No. 25, LLC v. Ammons E. Corp., 207 N.C. App. 232, 236 (2010) (cleaned

up).

40. Our Court of Appeals has provided further illustration regarding the

applicability of this doctrine.

[E]ven a distinct, unequivocal, and absolute refusal to perform is not a
breach unless it is treated as such by the adverse party. Upon
repudiation, the non-repudiating party may at once treat it as a breach
of the entire contract and bring his action accordingly. Thus, breach by
repudiation depends not only upon the statements and actions of the
allegedly repudiating party but also upon the response of the non-
repudiating party.

Id. at 237 (cleaned up).
41. Similarly, the Delaware Court of Chancery has stated the following

regarding the anticipatory repudiation of a contract:

A repudiation of a contract is an outright refusal by a party to perform
a contract or its conditions. Repudiation may be accomplished through
words or conduct. A party may repudiate an obligation through
statements when its language, reasonably interpreted, indicates that it
will not or cannot perform; alternatively, a party may repudiate through
a voluntary and affirmative act rendering performance apparently or
actually impossible. In any event, repudiation must be positive and
unconditional. An attempt to renegotiate terms will not constitute
repudiation absent an unqualified refusal to perform unless the non-
repudiating party accedes.

A party confronted with repudiation may respond by (i) electing to treat
the contract as terminated by breach, (ii) by lobbying the repudiating
party to perform, or (iii) by ignoring the repudiation. Although perhaps
counterintuitive, whether repudiation amounts to a present breach is
predicated on the promisee’s response. Unless the non-repudiating
party relies upon the repudiation or notifies the promisor that it
considers the repudiation final, the promisor may retract his
repudiation, thereby returning the parties to the status quo ante. Once
the promisee relies on the repudiation--e.g., by filing suit for damages or
by engaging in a substitute transaction--or notifies the promisor it
regards the [repudiation] as final, effective retraction is no longer
possible.

West Willow-Bay Ct., LLC v. Robino-Bay Ct. Plaza, LLC, 2009 Del. Ch. LEXIS 23, at

*14–15 (Del. Ch. Feb. 23, 2009) (cleaned up).

42. But even assuming that Shannon’s statements to Raja constituted the

type of “unequivocal” and “absolute” refusal to perform sufficient to invoke the

anticipatory repudiation doctrine, it is clear that Plaintiffs elected not to treat

Shannon’s statements as an anticipatory repudiation of the APA and instead

continued to both perform under—and seek amendments to—the agreement.

43. Thus, regardless of whether North Carolina or Delaware law applies,

Plaintiffs’ failure to treat Shannon’s statements as an unconditional breach precludes
a finding of anticipatory repudiation. See Profile Invs. No. 25, LLC, 207 N.C. App. at

237 (“[E]ven a distinct, unequivocal, and absolute refusal to perform is not a breach

unless it is treated as such by the adverse party.” (cleaned up)); West Willow-Bay Ct.,

LLC, 2009 Del. Ch. LEXIS 23, at *15 (“[W]hether repudiation amounts to a present

breach is predicated on the promisee’s response.”).

44. Therefore, the Court is unable to conclude as a matter of law that

Plaintiffs’ claim accrued in June 2015 as a result of Shannon’s comments.

45. Instead, the Court finds that significant questions of fact remain as to

the date upon which Plaintiffs’ claim for breach of Section 2.6(b) accrued for statute

of limitations purposes. See Chisum v. Campagna, 376 N.C. 680, 699–702 (2021)

(affirming trial court’s submission to jury of question as to when statute of limitations

began to run).

46. Accordingly, PRA’s Motion for Summary Judgment based on the statute

of limitations is DENIED. 7

II. Takeda MSA as an External Sale Under the APA

47. In connection with Plaintiffs’ appeal to the Supreme Court in this case,

the parties debated whether the MSA between PRA and Takeda constituted an

“External Sale” under the APA (such that PRA was required to credit the transaction

towards the APA’s External Sales Milestones).

48. The APA defines an “External Sale” as follows:

7 In light of the Court’s ruling, it need not address Plaintiffs’ alternative arguments regarding

the applicability of equitable tolling or the prevention doctrine to defeat summary judgment
based upon Defendants’ statute of limitations defense.
“External Sale” means the sale of one or more licenses to [PSO] by [PRA]
or one of its Affiliates to a third party which is not (i) an Affiliate of
[PRA] or (ii) using such license(s) in connection with providing services
to [PRA] and/or any of its Affiliates.

(APA, Ex. A.)

49. Section 7.02(b) of the Takeda MSA states as follows:

(b) License to PRA[] Owned Technology During the Term. As of the
Commencement Date and for the remainder of the Term, PRA[] hereby
grants Takeda, Takeda Affiliates and their respective Personnel and
third party service providers the right to access and use PRA[] Owned
Technology used in supporting or providing the Services for purposes of
receipt and use of the Services in the conduct of Takeda’s and Takeda
Affiliates’ business. For the avoidance of doubt, the foregoing right is
granted under all PRA[] Owned IP and includes the right to use all the
configuration capabilities offered by the PRA[] Owned Technology.[8]

(Takeda MSA § 7.02(b).)

8 The Takeda MSA defines “PRA[] Owned Technology” as follows:

“PRA[] Owned Technology” means (i) all confidential or proprietary processes,
procedures, methodologies, standard operating procedures, software,
templates, programs and other protectable materials that are used generally
by PRA[] in PRA[]’s business, but excluding any that are specifically created
for or resulting from a Study or relate to a Study Drug or any other Takeda
Product or that otherwise constitute or are based on Takeda Owned IP,
regardless of whether such materials or any portion thereof are used in
connection with PRA[]’s performance under this Agreement or the applicable
Site Agreement, and (ii) derivative works, modifications and enhancements to
any of the foregoing, but excluding any that are specifically created for or
resulting from a Study or a Study Drug or any other Takeda Product or that
otherwise constitute or are based on Takeda Owned IP, regardless of whether
such materials or any portion thereof are used in connection with PRA[]’s
performance under this Agreement or the applicable Site Agreement; and (iii)
any form of delivery for (i) or (ii) received as part of the Services, such as via
Cloud Computing.

(Takeda MSA, Ex. 1, at 8.)
50. PRA is listed as the licensor of PSO in Exhibit 18 to the Takeda MSA.

(Takeda MSA, Ex. 18.)

51. In its opinion, the Supreme Court stated the following with respect to

how to apply the APA’s definition of “External Sale” to the Takeda MSA:

The Takeda MSA closely mirrors the APA definition of “External Sale.”
As part of a bundle including the use of the software and providing
services to Takeda, and in exchange for a price of approximately $491
million over a term of years, PRA transferred a license to Takeda;
Takeda is neither an affiliate of PRA nor providing a service to PRA.

Defendants appear to be arguing that they have excluded the
transaction with Takeda from the APA definition of “External Sale” by
simply bundling the transfer of the license as part of a service package
and by not including an invoice line item of the license. This
interpretation is unreasonable and produces an absurd result. Manti
Holdings, LLC, 261 A.3d at 1208.

Moreover, defendants could have contracted around the issue of a line-
item requirement if such a carve out was truly an intended part of the
bargain. In the APA, defendants excluded from the realm of “External
Sale” “(i) an Affiliate of [PRA] or (ii) using such licenses in connection
with providing services to [PRA] and/or any of its Affiliates.” (Emphasis
added.) The parties could have included a third carve out: “(iii) license
bundled within a software as a service agreement in connection with
PRA providing services to a third-party.” See Winshall v. Viacom Int’l,
Inc., 76 A.3d 808, 816 (Del. 2013) (quoting Aspen Advisors LLC v. United
Artists Theatre Co., 861 A.2d 1251, 1260 (Del. 2004). Defendants did not
do so. Furthermore, defendants’ own expert witness, Bryan Haas,
testified that “software as a service is not always a license. Sometimes
it’s just that you have access to use [it].” It seems that a license did not
necessarily have to be issued to provide this service to Takeda.
Nevertheless, PRA issued a license to Takeda and called it a license in
the MSA.

To be sure, this Court is not suggesting that if PRA were to simply refuse
to use the term “license” for a transfer of software that it would be
excluded from the definition of “External Sale.” Instead, what this Court
is saying is that, here, in this circumstance, the Takeda MSA specifically
included, for a price, the transfer of a license to use the “PRA[ ] Owned
Technology.” What is unknown is whether the Takeda MSA was drafted
such that Takeda was required to pay consideration to acquire and use
a license of the [PSO]. Therefore, defendants’ failure to pay for the
transfer of the license to Takeda under the MSA, as required by the
APA, may be a breach of contract.

We hold that the Takeda contract could be an “External Sale.” This
Court remands this issue to the trial court to determine whether the
Takeda MSA was drafted such that Takeda was required to pay
consideration to acquire and use a license of the [PSO] . . . . On remand
the trial court may find there is a need for additional discovery to
determine if there are other external contracts that include transfer of
licenses to the [PSO], either in effect, or that were specifically termed as
such and which required consideration in exchange for the [PSO].

Value Health Sols., Inc., 385 N.C. at 273–74.

52. Pursuant to the Supreme Court’s directive, this Court, on remand,

allowed the parties to take supplemental discovery on the following topic:

Whether the Takeda MSA was drafted such that Takeda was required
to pay consideration to acquire and use a license of [PSO], thereby
rendering the Takeda contract an “External Sale,” along with any
potentially recoverable damages arising therefrom. Relatedly, whether
PRA has executed any other customer contracts that include the
transfer of licenses to [PSO], either in effect, or that were specifically
termed as such, and which required the payment of consideration in
exchange for [PSO], whether such payment was specifically termed a
payment wholly or partially in exchange for [PSO] or effectively served
as such a payment albeit not so specifically termed, along with any
potentially recoverable damages arising therefrom.

(Suppl. CMO § (IV)(A)(5)(b).)

53. The supplemental discovery conducted by the parties included, without

limitation, the deposition of a Takeda representative, Elizabeth Lyskanowski, and

the production of various “Statements of Work” (“SOWs”) detailing specific tasks that

PRA performed for Takeda pursuant to the Takeda MSA. 9

9Although the Takeda MSA was the only Takeda-specific document referenced by the
Supreme Court in its opinion, the MSA provided that “each clinical trial or study that Takeda
54. The Court’s review of the above-referenced testimony and the

documents of record have failed to reveal any evidence whatsoever suggesting that

the “MSA was drafted such that Takeda was required to pay consideration to acquire

and use a license of [PSO].” Value Health Sols., Inc., 385 N.C. at 274.

55. There are only two isolated references to PSO within the hundreds of

pages that comprise the SOWs, and those references do not appear in connection with

any form of payment or consideration by Takeda to PRA. (ECF No. 221.18, at 36–

37.)

56. Lyskanowski’s deposition testimony further confirms that there was

never any intention by either Takeda or PRA for consideration to be paid in exchange

for a license in PSO. (See, e.g., Lyskanowki Dep., at 38, 69–70, ECF No. 201.6,

Lyskanowski Dep., at 36, 69–71, 74, ECF No. 221.7.)

57. In response to Defendants’ Motion for Summary Judgment, Plaintiffs

did not offer any evidence to the contrary. Indeed, at the 24 June hearing on the

Motions, Plaintiffs’ counsel conceded that there is no evidence showing that Takeda

was required to pay consideration in exchange for a license to acquire and use PSO.

58. For these reasons, the Court GRANTS summary judgment for PRA on

the issue of whether the Takeda MSA constitutes an External Sale under the APA.

sought to have PRA perform—including the tasks to be performed and the cost associated
with each particular task—would be defined in a separate” SOW. (Defs.’ Br. Supp. Mot.
Summ. J. and Partial Summ. J. Pursuant Rule 56(B), at 6, ECF No. 219.)
III. PRA’s Internal Use of PSO as External Sales

59. Finally, PRA seeks summary judgment in its favor on the issue of

whether PRA’s purely internal use of PSO constituted an External Sale under the

APA. Specifically, PRA seeks clarification in the form of a ruling from the Court that

no External Sales occurred as defined in the APA in situations where PRA itself used

PSO to conduct in-house clinical research for customers—that is, contracts that did

not include a transfer of a license for PSO by PRA to the customer.

60. In its opinion, the Supreme Court made clear that in order for an

External Sale to have occurred under the APA, a contract between PRA and its

customer must have included a transfer of a license for the customer to use PSO.

Value Health Sols., Inc., 385 N.C. at 273–74.

61. As Plaintiffs’ counsel concedes, under circumstances where no license

was conveyed, the Supreme Court’s definition of External Sale would not be satisfied.

62. Accordingly, summary judgment is GRANTED as to the issue of

whether these in-house clinical trials constituted External Sales under the APA.

CONCLUSION

THEREFORE, it is ORDERED as follows:

i. Plaintiffs’ Motion to Strike is DENIED.

ii. Defendants’ Motion for Summary Judgment is GRANTED as to the following

issues:

a. Whether the Takeda MSA constitutes an External Sale under the APA;

and
b. Whether PRA’s internal use of PSO for in-house clinical trials

constituted an External Sale under the APA in the absence of a transfer

of a license for PSO to the customer.

iii. Defendants’ Motion for Summary Judgment is DENIED as to the following

issue:

a. Whether the statute of limitations serves to bar any portion of Plaintiffs’

claim for breach of Section 2.6(b) regarding PRA’s allegedly improper

conditioning of the External Sales upon the completion of the APA’s

Internal Development Milestones.

SO ORDERED, this the 23rd day of July, 2025.

/s/ Mark A. Davis
Mark A. Davis
Special Superior Court Judge
for Complex Business Cases