Texas Judge Issues Complicated Restraining Order in Celltex v. RNL Bio/Human Biostar tussle

Today, a judge issued a complex, temporary restraining order (PDF here, provided by Celltex) regarding Texas stem cell company Celltex and Human Biostar Inc (HBI)/Biostar, former partners who are now in conflict and have sued each other. For more background see here, here, and here.

Note that while both parties have sued each other, the judge’s ruling is specifically in regards to the case where Celltex is Plaintiff and RNL Bio/HBI are Defendants. Also note that I do not take sides in this conflict, and I believe that both parties are innocent of each other’s charges until or if a court rules otherwise.

The restraining order will be in effect until Jan 10, 2013 when a temporary injunction hearing will be held. A copy of part of page 1 is above.

In the order, which has the definite feel of something related to a divorce proceeding in my opinion with the stem cells like the kids, the two parties agree to 15 elements, which I’ve summarized below if you do not want to read the whole big thing:

1. HBI will allow Celltex access to the new location of the stem cells, defined as “the premises”: 12621 W. Airport Blvd, Suite 800, Sugarland, TX 77478. Access shall begin no later than tomorrow (Dec. 19).
2. Celltex may access the premises up to but no more than twice a week. Celltex has to provide 24 hours notice for these visits.
3. Celltex can only access the part of the premises where Celltex patient tissues or cells are stored.
4. Only 3 people from Celltex can attend.
5. Nine detailed conditions and restrictions are placed upon what Celltex can do related to cells/tissues during the visits. For example, Celltex cannot remove the cells or examine them other than visually.
6. Celltex agrees to leave the premises immediately in the event of an emergency or when requested by HBI.
7. Celltex will treat all documents as confidential.
8. Celltex must abide by HBI’s safety protocols and workplace instructions.
9. Within 3 days of this order, HBI will install a video camera allowing Celltex to remotely observe the cryopreservation tank room. Celltex will pay for this installation.
10. Celltex will be allowed to obtain copies of patient records related to the stored tissues and cells.
11. HBI will not remove cells from the premises without Celltex’s permission and HBI will “undertake professionally reasonable measures to ensure that stem cell deposits processed for Celltex are not degraded, contaminated, or destroyed.”
12. This order does not imply that HBI withdraws claims regarding Celltex’s actions with the FDA in regards to the premises.
13. HBI will provide on vial of David Eller’s tissues to Celltex so it can do verification testing, at Celltex’s expense.
14. If a physician provides a written request for a particular patient’s stem cells, HBI will allow Celltex to remove a “P2” vial of that client’s stem cells, but Celltex must deposit a fee of $5,000 or if the patient is on certain invoices, $10,000.
15. The court will hold these funds until future disposition of the parties’ claims.

What does all this mean?

On one level, in my opinion it is a positive for Celltex since via physicians, their clients can get access to the stem cells. On the other hand, it’s a complicated situation and the many restrictions are notable for both sides and there seem to be some concessions by both parties.

Maybe it is clearest that this is at least potentially beneficial for the patients, who are caught in the middle.

I remain puzzled about how RNL Bio and HBI might be related, and what it means that RNL Bio failed to appear, but I think item #16 is kind of a big deal that the court is treating HBI and RNL Bio equally in regards to the restraining order.

Stay tuned for the hearing next month.