MANELLA, J.
Edwards Lifesciences Research Medical, Inc. ("defendant" or "Edwards RMI") appeals from a judgment of the superior court that it owed Gerald D. Buckberg, M.D. ("plaintiff" or "Dr. Buckberg") over three million dollars under two contracts that expired on May 27, 2008. Defendant contends that the plain language of the contracts obligated it to pay plaintiff only a fraction of that amount. Plaintiff cross-appeals from the trial court's finding that the contracts expired. He contends that the contracts have not expired, as defendant is continuing to benefit under the contracts by using his name in sales and promotional materials. We conclude that defendant owes plaintiff a 7% royalty rate on the sale of patented products until the expiration of patents covered by the agreements. We further conclude that the agreements expired at the end of their original terms and were not extended. We will remand the matter for the trial court to recalculate damages.
Plaintiff is a well-known and distinguished cardiothoracic surgeon. In June 1987, defendant, then known as Research Medical, Inc. (RMI), was interested in developing a retrograde cannula with plaintiff's assistance. A retrograde cannula is a tubular device used in open heart surgery through which fluids are pumped into the heart muscle. The cannula is inserted into the coronary sinus (a large vein that drains blood from the heart muscle), and the fluids are pumped through the device into the heart in the opposite direction of ordinary blood flow. An antegrade cannula is a similar device that introduces fluids in the same direction as ordinary blood flow.
In accordance with his discussions with Gary Crocker ("Crocker"), then President of RMI, and other representatives of RMI, plaintiff prepared a proposed agreement entitled Consultant's Agreement Regarding Coronary Sinus Cannula (the "CSC Agreement"). The CSC Agreement was executed by both parties in July 1987.
Under Article II of the CSC Agreement, plaintiff agreed to provide "consulting services," which consisted of assisting in the development of a retrograde cannula, advising on the operability and best procedures for using the device, and promoting the sale of the device. In addition, paragraph 2.04 provided that:
In addition, under paragraph 3.02 of the agreement, defendant would provide plaintiff with a written report within 31 days after the close of each calendar quarter "during the term of this Agreement." The report would include the Net Revenue, the number of cannulae sold in the prior calendar quarter, and all deductions used to calculate net selling price.
In Article VIII of the CSC Agreement, the parties agreed on when the agreement would terminate. Paragraph 8.02 provided that:
In addition, Article VIII of the CSC Agreement included an enhanced product payment or royalty provision. Paragraph 8.03 provided that:
Finally, paragraph 11.03 of the CSC Agreement provided that "[a]ny notice to be given pursuant to this Agreement shall be in writing."
In December 1988, the parties entered into a similar agreement relating to antegrade cannulae — the Antegrade Agreement. The Antegrade Agreement contained the same provisions detailed above, except that they applied to antegrade cannulae and paragraph 8.02 of the Antegrade Agreement provided for a term of 144 months plus one day, rather than just 144 months as provided in the CSC Agreement.
Pursuant to paragraph 3.01, subdivision (b) of the agreements, defendant began paying plaintiff royalties at the rate of 5% of Net Revenue. Beginning in 1991, the parties obtained two patents (one for a retrograde catheter and one for a stylet for a retrograde catheter) that were covered by the CSC Agreement. The last patent covered by the CSC Agreement expired on July 13, 2010. The parties also obtained a patent on an antegrade cannula in 1991; this patent expired on September 21, 2009.
Soon after the patents were obtained in 1991, defendant increased the royalty payments from 5% to 7% of Net Revenue pursuant to paragraph 8.03 of the agreements. Each time defendant made a royalty payment, it provided plaintiff with a written report as required by paragraph 3.02. The written report indicated the number of cannulae sold, the net revenue, and the royalty rate.
Although defendant never paid plaintiff at a royalty rate greater than 7%, defendant paid plaintiff more royalties than it did to any other person or entity. The significant amount of royalty payments caused defendant to periodically review the agreements to ensure the royalty amounts being paid to plaintiff were correct. After each review, defendant continued to pay plaintiff at the 7% rate for patented products until 2007.
In March 2007, Rick Bleil, Edwards RMI's new Vice President and General Manager, "visited Dr. Buckberg . . . and told him, for the first time, that [Edwards RMI] overpaid him from 2000 through 2006 in the sum of $2.04 million by `oversight,' that the Agreements were extended for the right to use his name, that he should only have received 2% post patent royalty, plus a 1½% royalty for the right to use his name, and that [Edwards RMI] had determined that the 144 month initial term of the CSC Agreement as defined by paragraph 8.02 expired in 2000." Plaintiff disagreed with defendant's interpretation of the agreements, and hired an attorney to address the issue.
Plaintiff's counsel called Bleil and requested a summary of the accounting on the CSC Agreement. Bleil responded by sending an e-mail attaching a presentation which detailed the alleged overpayment to plaintiff. He also stated that there has been a "very amicable history between Edwards [RMI] and Dr. Buckberg" and that "[c]ertainly, 2.0mm [sic] is a large sum and we realize that we may need to work with Dr. Buckberg on timing." Plaintiff's counsel then sent a letter to Bleil explaining how Bleil's analysis was "erroneous." Plaintiff's counsel ended his letter by stating that "I would appreciate your reviewing of the foregoing and look forward to resolving these issues with you."
On March 28, 2007, defendant's counsel sent a response letter stating that defendant "vigorously disagree[d]" with plaintiff's interpretation of the CSC Agreement. Defendant's counsel asserted that plaintiff had been overpaid, but that Edwards RMI "ha[d] extended the contract in order to be able to continue selling the cannula under Dr. Buckberg's name." In light of the extension, it "appear[ed]" "undeniable" that Edwards RMI "had an ongoing obligation to pay Dr. Buckberg 1½% of Net Revenue." Counsel stated that "[Edwards RMI] looks forward to correcting the accounting on its relationship with Dr. Buckberg." In closing, defendant's counsel requested that any future correspondence be addressed to him, rather than to Bleil.
More than a year later, on April 18, 2008, defendant's counsel sent Dr. Buckberg's counsel a letter purporting to correct certain statements in his March 28, 2007 letter based upon his subsequent investigation. According to defendant's counsel, "[i]t does not appear that RMI or Edwards RMI has used Dr. Buckberg's name pursuant to [paragraph] 2.04 of either the [CSC] [A]greement (executed in July, 1987) or the [Antegrade] [A]greement (executed in December, 1988) since at least 2001, and most likely much earlier. Moreover, Edwards RMI has no record or other evidence of any extension of either agreement. Thus, so far as Edwards RMI is currently aware, both those agreements expired years ago and only the obligation to [pay] patent royalties continues."
Unable to resolve his disagreement with defendant, on March 18, 2008, plaintiff filed a complaint for breach of the CSC Agreement and declaratory relief in Los Angeles Superior Court. After answering the complaint, on May 27, 2008, defendant filed counterclaims seeking (1) declaratory relief on the Antegrade Agreement, and (2) reformation of paragraph 8.02 of the agreements to correct the "typographical mistake" of referring to paragraph 3.01(a) instead of 3.01(b) in that paragraph.
At the subsequent bench trial, Dr. Buckberg testified about the parties' intention and understanding concerning the royalty payments on the cannulae. He recalled that during his discussions with Crocker, "[w]e said the royalty for the product would be — would be five percent if the product was not patented. And I said, if the product got patented, then the royalty would extend [sic] from 5 percent to 7 percent. [¶] And I indicated to him that sometimes it may take two or three or four years to get a patent. But once the product was patented, the royalty would be increased to 7 percent and that the royalty would continue to be paid until the patent expired."
Plaintiff also submitted a declaration in which he explained the parties' intent in drafting paragraph 8.03. According to plaintiff, he and Crocker "discussed and agreed that if [Edwards RMI] elected not to extend the CSC Agreement past its initial 144 month term, then [Edwards RMI] would no longer have the right to use [his] name in connection with the sale of the product and would have no further obligation to retain [him] [as] a consultant or to pay [him] a consulting fee. In that case, the only obligation [Edwards RMI] would have to [plaintiff] would be to pay [him] a 7% royalty if a patent was obtained (which it subsequently was) from that time until the patent expired."
Plaintiff admitted on cross-examination that he did not pay attention to when the agreements expired. When asked why, if he believed the contract had been extended under paragraph 8.02, he never inquired about the 1½% name use royalty he was due, he stated that he "assumed that, if we got to that point," Edwards RMI would have paid his name use royalty because "it was always in compliance" with royalty payments. In a post-trial brief, plaintiff asserted that he discovered defendant owed him the name use royalty only in March 2007, when defendant told him the CSC Agreement had expired on September 30, 2000.
Defendant did not call Crocker as a trial witness. Nor did defendant submit any extrinsic evidence concerning the negotiations or the parties' intentions with respect to the various contractual provisions. Defendant did submit evidence that it had no record of using the name "Buckberg" on its product labels after September 30, 2000.
Plaintiff's name, however, appeared in three pieces of advertising or promotional material used by defendant after that time. The first was a marketing brochure used until 2004 to promote a retrograde cannula. The brochure stated that the cannula could be easily inserted because it had a "patented Buckberg-style handle."
After considering the evidence, the trial court ruled in favor of plaintiff on most of his claims. In its August 17, 2009 Statement of Decision, the court found that Dr. Buckberg was a "credible, truthful, and honest" witness, but that "accuracy comes and goes with memory." The trial court excluded the correspondence between the parties' counsel in 2007 under Evidence Code section 1152 on the basis that the March 28 letter was a statement made in an offer of compromise or settlement negotiations.
The court determined that "[t]he provisions of Paragraph 8.03 contained in the CSC and Antegrade Agreements are ambiguous. Based on credible extrinsic evidence at trial, the Court finds that Paragraph 8.03 of the CSC and Antegrade Agreements, read in conjunction with Paragraph 3.01(b), is interpreted to mean that Dr. Buckberg is entitled to a royalty in the amount of 7% of net revenue as defined in the Agreements from the date the initial patent is obtained for a product within the scope of Agreement until the expiration of the last such patent, whether or not the initial term of the Agreements was extended." Accordingly, defendant was obligated to pay plaintiff a 7% royalty of net revenues until July 13, 2010 under the CSC Agreement, and until September 21, 2009 under the Antegrade Agreement.
The court further found that "[t]he original term of the CSC Agreement ended on September 30, 2000 and the original term of the Antegrade Agreement ended on December 31, 2003. The CSC and Antegrade Agreements did not terminate on those dates, but were extended by Edwards RMI for the right to use Dr. Buckerg's name until May 27, 2008, the date Edwards RMI filed its Cross-Complaint in this action." The court determined that "although notice of extension in writing was required by paragraph 11, no magic words are necessary. The continued royalty payments by Edwards RMI and accompanying cover letters constituted a sufficient writing to be a notice of extension." The court went on to find that the intent of the parties to continue the contract was evidenced by: "a) the ongoing royalty payments by Edwards RMI to Dr. Buckberg during the period from October 2000 through December 31, 2006, and b) the facts that periodically through that time, the agreements were handled and reviewed by Edwards RMI's management, attorneys and executives, Edwards RMI treated the agreements as operative, and [Edwards RMI] continuously made payments thereunder without objection until March 2007." Accordingly, the court found defendant was contractually "obligated to pay Dr. Buckberg a royalty of 1½% of net revenue as defined in the agreements for the right to use Dr. Buckberg's name from the expiration of each contract until May 27, 2008. The court determined, however, that damages for the 1½% name use royalty from 2000 through 2004 were time-barred, and plaintiff does not appeal from this particular ruling.
The court further found "Edwards RMI's use of Dr. Buckberg's name in the promotional video and the brochure for the `Global Myocardial Protection' marketing campaign [did] not obligate Edwards RMI to pay Dr. Buckberg any royalties." According to the court, defendant's "use of Dr. Buckberg's name in its brochure [was] part of a citation to a scientific article for the purpose of substantiating claims Edwards RMI [was] making for its products in the brochure. The use of Dr. Buckberg's name as part of [a] citation to a scientific article [was] not a use of his name governed by Paragraph 2.04 of the CSC or Antegrade Agreements. Rather, the use of Dr. Buckberg's name in that manner [was] in the public domain." The court also determined that Edwards RMI could use "Dr. Buckberg's name in the promotional video without paying him for any royalties for doing so because it obtained Dr. Buckberg's consent in a separate contract."
The court also ruled on defendant's counterclaim for reformation of paragraph 8.02. It found that "[t]he references in Paragraph 8.02 to Paragraph 3.01(a) in the CSC and Antegrade Agreements are correctly stated and are not typographical errors or mistakes."
Judgment was entered August 25, 2009 in the amount of $3,689,028 plus interest. Both parties filed timely appeals.
Defendant contends that the trial court erred in interpreting the CSC and Antegrade Agreements (1) when it determined the appropriate royalty rate under paragraph 8.03, and (2) when it determined that the agreements were extended under paragraph 8.02. We independently review a trial court's interpretation of a contract, but we defer to the trial court's determination of the credibility of any admissible extrinsic evidence. (See, e.g., Kusmark v. Montgomery Ward & Co. (1967) 249 Cal.App.2d 585, 587 ["`It is . . . solely a judicial function to interpret a written instrument unless the interpretation turns upon the credibility of extrinsic evidence.'"].) We address each of defendant's contentions in turn.
Paragraph 8.03 provided that "[i]f the manufacture, use or sale of any Coronary Sinus Cannulae is within the scope of one or more claims of any valid existing patent owned by [Edwards RMI] or [plaintiff], [Edwards RMI] shall pay to [plaintiff] a product payment 2% greater than that specified in paragraph 3.01, (b) (i.e. 7% of Net Revenue attributable to the sale or lease of the Coronary Sinus Cannulae by [Edwards RMI] or [Edwards RMI] sublicensee during the term of this Agreement) hereof, but, however, such payments shall continue for each such Coronary Sinus Cannulae until the expiration of all patents claiming such product."
According to defendant, the plain language of paragraph 8.03 obligates defendant to pay plaintiff at only a 2% royalty rate on net revenue of the sale of patented cannulae from the end of "the term of th[e] Agreement" until the expiration of the last covered patent. Under defendant's interpretation, it is required to pay royalties at a rate of 2% plus the amount specified in paragraph 3.01, subdivision (b), which provides for product payments of 5% of Net Revenue during the term of the agreement. Defendant contends that once the agreement expired, the amount specified in paragraph 3.01, subdivision (b) dropped to 0% because under paragraph 8.02, "[a]ll obligations under this Agreement shall expire" at the end of the original term. Thus, defendant contends that it was obligated to pay 2% + 0%, or 2%, from the end of the agreement until the expiration of all relevant patents. We disagree that the paragraph 8.03 is susceptible only to defendant's interpretation.
Defendant's interpretation, while arguable, does not fully conform to all of the contractual language in the agreement. First, defendant's interpretation is based upon the language in paragraph 8.02 that "[a]ll obligations under this Agreement shall expire" at the end of the original or extended term of the agreement. Defendant concedes, however, that the contractual obligation in paragraph 8.03 to make patented product payments could and did continue beyond the original or extended term of the agreement. Moreover, defendant does not suggest that its obligation to make continuing royalty payments on the sales of patented products did not include the obligation to provide a written report under paragraph 3.02 which, by its terms, applies only during "the term of this Agreement."
Second, the phrase "but, however," in paragraph 8.03 can reasonably be interpreted to mean that irrespective of any previously articulated royalty rate formula in the contract, paragraph 8.03 creates a new royalty rate formula. Thus, it is reasonable to interpret paragraph 8.03 to provide that defendant will pay plaintiff at a 7% royalty rate during the term of the agreement, and that this would normally be reduced to 2% after the expiration of the agreement, but in this case, however, the 7% rate would continue until the expiration of the last covered patent.
Because the contractual language is susceptible to more than one interpretation, extrinsic evidence may be admitted to resolve the ambiguity. (WYDA Associates v. Merner (1996) 42 Cal.App.4th 1702, 1709.) The trial court found credible plaintiff's extrinsic evidence that the parties intended that the 7% payment would continue until the expiration of all relevant patents. It further credited plaintiff's testimony that the parties neither agreed to nor discussed any reduction of the royalty rate from 7% to a lesser amount on sales of patented products. Defendant presented no evidence to the contrary. The court noted that defendant did not call Crocker, who had negotiated the contract with plaintiff, although defendant was aware of his whereabouts. Additionally, the extrinsic evidence showed that despite defendant's admitted interest in minimizing payments to plaintiff, and after repeated reviews of the agreements following their expiration, defendant continued to pay plaintiff royalties at the 7% rate plaintiff testified was contemplated in the agreements and which the language of the agreements reasonably supports. On this record, we conclude that the trial court properly interpreted paragraph 8.03 to provide that defendant would be obligated to pay plaintiff a 7% royalty from the end of the term of the CSC and Antegrade Agreements until the expiration of the last patents covered by those respective agreements.
Defendant also contends that the CSC and Antegrade Agreements were never extended past their original terms. According to defendant, the trial court properly concluded that defendant could extend the agreements only through written notice. Because no evidence was located or produced showing that defendant gave such written notice of extension, defendant contends that the agreements were never extended. Defendant thus asserts that it is not obligated to pay plaintiff a 1½% name use royalty under paragraph 8.02. We agree.
Paragraph 8.02 provided that "[Edwards] RMI shall, prior to termination, have the option to extend the term of this Agreement beyond [the] expiration date should [Edwards] RMI desire to continue to use the name `Buckberg' as provided for in paragraph 2.04 hereof. In the event [Edwards] RMI elects to extend the term of this Agreement, the payment provided for in paragraph 3.01(a) hereof shall, for the duration of such extension, equal one and one half (1½%) of said Net Revenue."
Thus, under paragraph 8.02, defendant could extend the term of the agreements if it wished to use plaintiff's name to promote and sell antegrade and retrograde cannulae. In order to extend the agreements, defendant was required to provide written notice prior to the expiration of the agreements. There is no evidence that defendant ever provided plaintiff with written notice of its intention to extend either agreement. The cover letters and written reports for the royalty payments cannot be construed as written notices of extension because they contain no language that could be interpreted as extending the agreements. Rather, they provide factual information on the number of cannulae sold and the royalty payments being remitted plaintiff. Thus, defendant never extended the agreements in conformity with paragraph 8.02.
On appeal, plaintiff contends that by its conduct, defendant has waived the written notice requirement, and thus the agreements were extended. (See, e.g., Tay-Holbrook, Inc. v. Tutt (1933) 218 Cal. 600, 604-605 [landlord waived renewal notice provisions in lease where parties acted as if lease had been renewed, with tenant staying in apartment and paying increased rent].) For example, it is undisputed that defendant paid a 7% royalty to plaintiff even after the original term of the agreements expired. This fact, however, does not support a finding that the contracts were extended, because paragraph 8.03 obligated defendant to make those payments regardless of whether the agreements were extended. Indeed, if the agreements were extended, defendant was obligated to pay a higher royalty rate (8½% instead of 7%). The fact that defendant never paid a higher royalty rate and plaintiff never objected is persuasive evidence that the agreements were not extended.
Plaintiff contends that defendant's use of his name in three pieces of advertising and promotional materials shows that the agreements were extended. Specifically, plaintiff asserts that the use of his name in a brochure and video used for the 2004 "Global Myocardial Protection" campaign constituted a use of his name governed by paragraph 2.04 of the agreements. The trial court found otherwise, and we agree with the court.
Paragraph 2.04 permitted defendant to use "the name `Buckberg' only on the Coronary Sinus Cannula and on advertising and instructional literature used in conjunction with the promotion and sale thereof." The GMP brochure claimed that "a growing body of evidence points to combined antegrade and retrograde cardioplegia as the best approach" for maximizing myocardial protection. In support of this claim, five articles were cited, including two articles authored by Dr. Buckberg. The citations appeared on the last page of the brochure, by themselves. After reviewing the brochure, we conclude that defendant was not using Buckberg's name to directly sell coronary sinus cannulae. For example, the cannulae were not referred to in the brochure as Buckberg-designed or Buckberg-recommended cannulae. Instead, defendant was citing to publicly available medical studies to support its contention that the use of both antegrade and retrograde cannulae during heart surgery maximized myocardial protection. This contention would apply to any cannulae, whether or not covered by the agreements. Accordingly, paragraph 2.04 does not cover this particular use of Dr. Buckberg's name.
Similarly, the use of plaintiff's name and likeness in the GMP video was not covered by paragraph 2.04. First, paragraph 2.04 applies only to "advertising and instructional literature," not to marketing materials such as video.
Moreover, the use of plaintiff's name in the video was covered by the separate contract signed by Dr. Buckberg — the consent form. Plaintiff contends that the consent form is not a valid contract because it does not indicate that he received any consideration, and he asserts that he was never compensated for the video. Whether consideration was given, however, is a moot issue where a contract has been fully performed. (Schiffman v. Atlas Mill Supply Inc. (1961) 193 Cal.App.2d 847, 853 ["Consideration applies to the executory contract; after the contract is fully executed on both sides it becomes a closed incident and the question of consideration becomes immaterial."].) Here, plaintiff appeared in the video but sought no compensation for his appearance, though he was aware that defendant would use the video as part of its marketing campaign. In addition, plaintiff had an independent incentive to participate in the promotional video because it could be used to promote the sale of defendant's cannulae, which would result in additional royalty payments to plaintiff under the agreements.
Finally, the use of plaintiff's name in a sales brochure for retrograde cannulae is not dispositive of whether the CSC Agreement was extended. The brochure, copyrighted in 2001 and used until 2004, claimed that the retrograde cannulae sold by defendant were easy to use because they employed the "patented Buckberg-style handle." Even if this use of plaintiff's name was covered by paragraph 2.04, it does not, by itself, show that defendant had an intent to extend the CSC Agreement, especially where (a) there was no evidence the brochure was used until after the CSC Agreement expired, and (b) defendant's other conduct, such as its failure to pay a name use royalty, indicated that it did not intend to extend the agreement.
Plaintiff contends that admissions by Bleil and defendant's counsel that the agreements were extended establish that they were. We disagree that the purported admissions are dispositive. As an initial matter, we conclude that the statements, if deemed admissions, would apply only to the CSC Agreement. Although the trial court found that Bleil made a statement about the agreements being extended in March 2007, our review of the record convinces us that the finding was erroneous. The dispute over the Antegrade Agreement did not arise until defendant filed its counterclaims in May 2008. Moreover, the contemporaneous e-mail sent by Bleil refers only to one agreement and the attached document shows that it was an agreement on retrograde cannulae. The March 2007 statements by defendant's counsel, on the other hand, explicitly referred to the CSC Agreement. Only the later April 18, 2008 letter from counsel, correcting the prior statements, refers to both agreements. Thus, Bleil and defendant's counsel stated in March 2007 only that the CSC Agreement was extended.
With respect to Bleil's statement to plaintiff, we find it relevant but not dispositive of whether the CSC Agreement was extended. While Bleil may have believed that the CSC Agreement was extended, the parties' conduct showed otherwise. First, there is no evidence that defendant gave written notice to extend, and the letters accompanying the royalty payments were consistent with defendant's obligation to pay the 7% product royalties until the expiration of the patents. Second, it is undisputed that defendant never paid the 1½% name use royalty. Third, Dr. Buckberg admitted he approved the GMP brochure and participated directly in the making of the GMP video. Yet he did not question the fact that his royalty payments made no mention of a 1½% rate due for extensions of the agreements. Instead, he asserted that he was not aware that the CSC Agreement had been extended until he was informed by Bleil in March 2007. The evidence thus indicates that neither party intended to waive the written notice requirement and extend the CSC Agreement.
With respect to the statements by defendant's counsel in his March 28, 2007 letter, we conclude that the trial court did not abuse its discretion in excluding that letter under Evidence Code section 1152, as an offer of compromise or statements made in the course of settlement negotiations. (Zhou v. Unisource Worldwide (2007) 157 Cal.App.4th 1471, 1476 [trial court's ruling excluding evidence under Evidence Code section 1152 is reviewed for abuse of discretion. Evidence Code section 1152 precludes documents "connected" to settlement negotiations.].) In determining whether a statement is an offer of compromise or is instead a statement against economic interest, the intent of the party is dispositive. (Moving Picture Etc. Union v. Glasgow Theaters, Inc. (1970) 6 Cal.App.3d 395, 402.) Here, the trial court impliedly found that the letter showed an intent to compromise. After reviewing the letter, we conclude that substantial evidence supports the trial court's finding.
First, the letter was drafted and sent in the context of an ongoing dispute over the interpretation of the CSC Agreement. In a prior communication to plaintiff's counsel, Bleil had indicated that defendant wished to work with plaintiff to resolve the overpayment and maintain their amicable relationship. Second, the purported admissions showed defendant's current understanding of the facts and reflected its offer to pay on those parts of the agreements that comported with its understanding of the facts. That understanding turned out to be incorrect after further investigation.
In the absence of evidence that defendant expressly sought to extend the agreements in conformity with their terms or did so impliedly through the continued use of Dr. Buckberg's name as contemplated by the agreements, we find no substantial evidence to support the trial court's finding that the CSC and Antegrade Agreements were extended. Defendant's position in March 2007 on the status of the CSC Agreement is not dispositive. The court's reliance on defendant's continued payment of royalties even after periodic reviews was misplaced, as the payment of a 7% royalty was wholly consistent with defendant's obligation to pay royalties on the sales of patented products through the expiration of the patents and regardless of any extension of the agreements. As noted, defendant did not pay name use royalties at any time, and plaintiff did not assert that defendant was required to do so until 2007, despite having drafted both contracts and being aware of the materials whose content allegedly triggered defendant's obligation to pay name use royalties. Accordingly, the trial court's determinations that the agreements were extended and that defendant owed a name use royalty are reversed, and the matter is remanded to the trial court to recalculate damages.
Plaintiff appeals from the trial court's determination that defendant terminated the CSC and Antegrade Agreements on May 27, 2008 when defendant filed its counterclaims. In light of our ruling that defendant did not extend the agreements and that the agreements expired prior to that date, plaintiff's appeal is dismissed as moot.
The judgment is affirmed in part, reversed in part, and remanded for further proceedings. Each party shall bear its own costs on appeal.
We concur:
EPSTEIN, P. J.
SUZUKAWA, J.
