Commitments and Contingencies

12 Months Ended

Dec. 31, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies

13. Commitments and Contingencies

The Company is currently a tenant at will occupying approximately 4,500 square feet of office space. Total rent expense was approximately $71,500 and $220,000 for the years ended December 31, 2012 and 2011, respectively and approximately $4115,500 for the period from inception (October 16, 1992) through December 31, 2012. The Company received approximately $102,000 for the year ended December 31, 2011, related to the sublease of the premises and no income from subleasing in 2012.

On March 13, 2012 the Company received notice that Children’s Hospital Boston and Children’s Medical Center Corporation had filed a lawsuit in Middlesex Superior Court, Middlesex County, Massachusetts seeking to recover amounts alleged to be owed by the Company to the plaintiffs.

On February 1, 2013 the Company entered into a Settlement Agreement and Release with Boston Children’s Hospital (BCH) and Children’s Medical Center Corporation (CMCC) in full settlement of the lawsuit filed by BCH and CMCC seeking to recover amounts alleged to be owed by the Company to the plaintiffs totaling $642,906 plus costs. The amount of $642,906 is included in accrued expenses at December 31, 2012 and 2011, but was incurred and expensed prior to January 1, 2011.

In settlement of all claims by BCH and CMCC, the Company agreed to pay a lump sum of One Hundred Eighty five Thousand dollars ($185,000) to the plaintiffs. In addition to the lump sum payment, the Company agreed to pay to the plaintiffs an additional sum equal to the then cash value of 20,000 shares of the common stock of Navidea BioPharmaceuticals, Inc. upon the occurrence of the first milestone described in Section 4.2 of the sublicense agreement dated as of July 31, 2012 between Navidea BioPharmaceuticals, Inc. and the Company. This second payment is only due upon the occurrence of the first milestone unless the Company declares bankruptcy or alters its agreement with Navidea in a manner that results in the delay or cancellation of said milestone payment.

On May 2, 2012 the Company received notice that Biostorage Technologies, Inc. had filed a lawsuit in Marion Superior/Circuit Court, Marion County, Indiana seeking to recover amounts alleged to be owed by the Company to the plaintiffs totaling $119,363. The Company believes that the total amounts claimed in the Biostorage lawsuit are overstated by at least 100%. The Company believes that a high level of uncertainty regarding the outcome, disposition and ultimate liability to the Company related to this lawsuit exists thus we have retained an accrual of $133,000 on our books which reflects the amount of the alleged claim plus additional legal fees. The discovery process in the case is on-going The Company intends to vigorously pursue all available legal and equitable remedies to defend this claim with a goal of settling it at or below the level of liability we believe is actually owed and without a trial.

Guarantor Arrangements

The Company has entered into agreements to indemnify its executive officers and directors for certain events or occurrences while the officer or director is, or was serving, at the Company’s request in such capacity. The indemnification period is for the officer’s or director’s lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a director and officer insurance policy that limits the Company’s exposure and enables the Company to recover a portion of any future amounts paid. As a result of the Company’s insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal.