A reformatted copy of the Court Order filed June 22, 2005, in Case No. CV03-
” IN THE SECOND JUDICIAL DISTRICT COURT OF THE STATE OF NEVADA IN AND FOR THE COUNTY OF WASHOE
CASE NO. CV03-
METABOLIC TREATMENT CENTERS, INC., a Nevada Corporation, Plaintiff,
METABOLIC INDUSTRIES, a Nevada Corporation, HAMILTON-
Based upon the review and consideration of the evidence presented at the June 8, 2005 hearing on Defendants Metabolic Industries (“MI”), a Nevada corporation, and Thomas T.. Aoki’s (“Dr. Aoki”) Application for Order to Show Cause (“Application”), the pleadings and briefs of the parties and the record before the Court, the Court orally pronounced its findings with regard to Defendants’ Application. Those findings of fact, conclusions of law and order are as follows:
I. RELEVANT PROCEDURAL HISTORY
A detailed relevant procedural history is contained in the Order Granting Preliminary Injunction dated September 20, 2004, attached and incorporated as Exhibit “A,” without exhibits. The instant Order arose from facts alleged in an Application for Order to Show Cause filed by MI and Dr. Aoki on February 7, 2005, attached and incorporated as Exhibit “B”, without exhibits. On February 17, 2005, MTC filed a timely Opposition to the Application, attached and incorporated as exhibit “C,” without exhibits. MI and Dr. Aoki filed their Reply on March 9, 2005, attached and incorporated as Exhibit “D,” without exhibits. At the same time as the filing of their Reply, MI and Dr. Aoki requested that their Application be submitted to the Court for consideration. Consequently, on June 8, 2005, a hearing was held on the Application with counsel for both parties present, the results of which are embodied in this Order
II. FINDINGS OF FACT
1. Dr. Thomas T. Aoki (Dr. Aoki”) developed Metabolic Activation Therapy (“MAT”).
2. Neither the Term Sheet nor the Collaborative Licensing Agreement provisions, not the dealings with Bionica, nor the doctrine of estoppel operated to render a legal conclusion that rights to market and implement MAT had been transferred to Metabolic Treatment Centers.
3. There is no evidence, authority, or agreement that permits the following companies to market MAT, open treatment centers/clinics or solicit investors. Those companies are: International Pulse Company (based in London, England), The United Diabetes Foundation (Dallas, Texas), Diabetes Medical Development Corporation (“DiabMed”) (Salt Lake City, Utah) and Diabetic Treatment Centers of America (“DTCA”). Under no circumstances can anybody have a right to MAT other than Dr. Aoki, Metabolic Industries (“MI”) or Metabolic Treatment Centers (“MTC”).
4. This Court has previously determined that Bionica does not have any rights to MAT.
5. In permitting the clinics to remain open, the first priority was that Dr. Aoki would be satisfied that the protocols developed and formulated by him are implemented. MTC did not object to this condition.
6. According to Max McCombs, things are going well at the clinics and patients have benefited. However, Max McCombs is not a medical expert and the source to finding out whether patients are benefiting is the protocol and the records (including patient records) to be given to Dr. Aoki for review. This has not been done because the clinics have not been cooperating with MTC.
7. The Court had ordered disclosure of the financial activities of the clinics and this has not been done due to the uncooperativeness of the clinics with MTC.
8. John Duffell plays a shadowy role in this situation. There is a relationship between Duffell’s company, Irvingstone Software, and MTC concerning MTC’s website. There is the astonishing fact that MTC somehow cannot control its own website. MTC and Duffell’s company, the United Diabetes Foundation, share offices in the same hallway of the same business office.
III. CONCLUSIONS OF LAW
1. International Pulse Company (based in London, England), The United Diabetes Foundation (Dallas, Texas), Diabetes Medical Development Corporation (“DiabMed”) (Salt Lake City, Utah) and Diabetic Treatment Centers of America (“DTCA”) do not have any rights whatsoever to MAT.
2. MTC and Max McCombs have not intentionally violated the PI Order.
3. The Court has jurisdiction over the franchise agreements because it is by virtue of those agreements that each clinic has the authority to operate at all.
Based on the foregoing, it is hereby ORDERED:
1. No later than forty-
2. Failure to comply with this Order shall result in the cancellation of any such franchise agreement.
3. No later than thirty (30) days from June 8, 2005, MTC shall either terminate or modify its website to remove therefrom any material soliciting investors in the franchises or other authority to operate clinics utilizing the MAT therapy; and either remove all together references to any lawsuit or accurately state the terms of the order of this Court entered September 20, 2004.
IT IS SO ORDERED.
DATED this (handwritten date) day of June, 2005.
Brent Adams (signature)
DISTRICT COURT JUDGE “