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Case 3:08-cv-01493-JM-BLM

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1 AMY WINTERSHEIMER FINDLEY (BAR NO. 163074) MICHAEL R. ADELE (BAR NO. 138339) 2 CHARLENE J. WILSON (BAR NO. 222497) ALLEN MATKINS LECK GAMBLE 3 MALLORY & NATSIS LLP 501 West Broadway, 15th Floor 4 San Diego, California 92101-3541 Phone: (619) 233-1155 5 Fax: (619) 233-1158 E-Mail: [email protected] 6 [email protected] [email protected] 7 Attorneys for Defendant 8 BIoRx, LLC 9 10 11 12 NUTRISHARE, INC., a California corporation,Case No. 2:08-cv-01252-WBS-EFB 13 14
V.

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA

Plaintiff,

Complaint filed June 4, 2008
DEFENDANT'S REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO DISMISS OR TRANSFER VENUE PURSUANT TO FRCP RULE 12(b)(2) AND (3) '

15 BIoRx, LLC, an Ohio Limited Liability Company, 16 Defendant. 17 18 19 20 21 22 23 24 25 26 27 28
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DATE: TIME: DEPT: JUDGE:

August 11, 2008 2:00 p.m. Courtroom 5 Hon. William B. Shubb

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REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SI~PORT OF MOTION TO DISMISS OR TRANSFER VENUE

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°

TABLE OF CONTENTS

1 INTRODUCTION ................................................................................................................
ARGUMENT ................................................. ...................................................................... 2
No

The State of California Does Not Have General Jurisdiction Over BioRx Because BioRx Does Not Have Sufficient Contacts With 2 California ................................................................................................................. Mere Registration with the California Board of Pharmacy . Does Not Automatically Confer General Jurisdiction over 2 BioRx .......................................................................................................... There is ,Insufficient Evidence of Any Other Contacts ¯Between BioRx and California to Establish General Jurisdiction ............................... ~ ......................................... i ...... i ................. 4 Plaintiffs Case Authority is Inapplicable and Does Not 5 Support a Finding of General Jurisdiction ..................................................

11 ~12
B°

3.

: ...........6 This Court Does Not Have Specific Jurisdiction Over BioRx .................... 1. 2. BioRx Has Not Purposefully Availed Itself of the Benefits 7 and Privileges of California ......................................................................... BioRx Has Not Purposefully Directed its Activities Toward 8 California .....................................................................................................

13 14 15 16
C°

17 18 19 20 21
Do

This Court Should Dismiss Plaintiffs Claim Because it Does Not 12 "Arise Out of" BioRx's Attenuated Contacts with California ............................... The Exercise of Personal Jurisdiction Over BioRx is Not 13 Reasonable ............................................................................................................ , Purposeful Interjection .............................................................................13 . 14 Burden on Defendant ................................................................................ 3. 15 Extent of Conflict with Sovereignty of Foreign State ............................... Forum State's Interest in Adjudication 15

22 4. 23 5. 24 6. 25 26
go

15 : Most Efficient Judicial Resolution ........................................................... 16 Convenience and Effectiveness of Relief for Plaintiff .............................. : .................... 6 1 Availability of Alternative Forum ........................................

7.

27 28 III.
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Alternatively, the Court Should Transfer This Case to the Southern 16 ~ ................... District of California ..........................................................................

17 CONCLUSION ... ..............................................................................................................
(i) REPLY MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION TO DISMISS OR TRANSFER VENUE

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1 2 3
Cases

TABLE OF AUTHORITIES

4 AMF, Inc. v. Sleekcraft Boats, 5 6

13, 599 F.2d 341 (9th Cir. 1979) ....................................................................................... 14

Amini Innovation Corp., v. JS Imports, Inc., 497 F. Supp. 2d 1093 (C.D. Cal. 2007) ..................' ......................................~ .................... 12

7 Bancroft & Masters v. Augusta National, 223 F.3d 1082 (9th Cir. 2000) .......................................................................................9, 12 8 Burger King Corp. v. Rudzewicz, 9 471 U.S. 462 (1985) .................................................................. ~ ......................................... 7 10 Cf Rio Props v. Rio Int'l Interlink, 284 F.3d 1007 (9th Cir. 2002) ............................................................. .......... : .................... 11 11 Core- Vent v. Nobel Industries, 12 11 F.3d 1482 (9th Cir. 1993) ......................................................................................... 9, 14 13 Cybersell, Inc. v. Cybersell, Inc., 14 15

7~ ; 130 F.3d 414 (9th Cir. 1997) ......................................................................................... 10

Data Disc, Ine. v. Systems Technology Associates, 6 : ...................... 557 F.2d 1280 (9th Cir. 1977) ......................................................................

16 Digital Equipment Corp. v. Altavista Technology, Inc., 960 F.Supp. 456 (D. Mass. 1997) .................. " .............................................. ~ .................... 12 17 Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. Co,, 13 18 907 F.2d 911 (9th Cir. 1990) ............................................................................................. 19 Gates Learjet Corp. v. Jensen, 743 F.2d 1325 (9th Cir. 1984) ......................................................................, .................. 6, 7 20 Goodman Ball, Inc. v. Clear Water USA, Inc., 11 21 2007 U.S. Dist. LEXIS 83996, "9-10 (N.D. Cal. 2007) ................................................... 22 Helicopteros Nacionales de Colombia v. Hall, S.A., 2 466 U.S. 408 (1984) 23 Insurance Company of North America v. Marina Salina Cruz, 24 649 F.2d 1266 (9th Cir. 1981) ..........................................................: ................................14 25 KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 408 F.3d 596 (9th Cir. 2005) ................................................................................ .............13 26 Kranseo Manufacturing v. Markwitz, 27 656 F.2d 1376 (9th Cir. 1981) .........................~ ............................................................... 6, 7 28 Mahroom v. Best Western Int 7, Inc., : 2007 U.S. Dist. LEXIS 56006, *7 (N.D. Cal. 2007) ........................ ...................... 5, 6, 7, 8
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1

Page(s)

2 Morgan Stanley High Yield Sees., Inc. v. Jecklin, 2006 U.S. Dist. LEXIS 53489 (D. Nev. July 28, 2006) ..............................................7, 8 4, 3 New Tech Stainless Steel Prods. Co. v. Sun Mfg. Corp., 11 4 2004 U.S. Dist. LEXIS 29132, "10-11 (C.D. Cal. 2004) .................................................. 5 Panavision Int'l v. Toeppen, 6 7
Pebble Beach Co. v. Caddy, 453 F.3d 1151 (9th Cir. 2006) .......................................................................................7, 10 942 F.2d 617 (9th Cir. 1991) .........................................................................~ ............. 15, 17 141 F.3d 1316 (9th Cir. 1998) ...............................................................' ................ 12, 15, 16

8 Roth v. Gareia Marquez, 9 10

Shute v. Carnival Cruise Lines, 863 F.2d 1437 (9th Cir. 1988) ............................................................ ~ ............................... 16 977 F. Supp. 404 (E.D. Va. 1997) ............................; ........................................................ 11

11 Teleo Communications v. ANApple A Day, 12 13

Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163 (9th Cir. 2006) ...........: ...........................................' .............................. 5, 6, 7 952 F. Supp. 1119 (W.D. Pa. 1997) ..................................' ................................................10

14 Zippo Mfg. Co. v. Zippo Dot Corn, Inc., 15 16 17 18 19 20 21 22 23 24 25 26 27 28
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Statutes

18 28 U.S.C. § 1391(b)(2) .................................................................................................................. 18 28 U.S.C. § 1404 ........................................................................................................................... 18 i " 28 U.S.C. § 1406 .......................................................................................................................... 2 Cal. Bus. & Prof. Code § 4112 ......................................................................................................... 2, . ..................................................... 3, 8 Cal. Bus. & Prof. Code § 4120 .......................................... 3 Cal. Bus. & Prof. Code § 4303 ........................................................................................................ 3 Cal. Bus. & Prof. Code § 4320 ........................................................................................................ 3 Cal. Bus. & Prof. Code § 4339 ........................................................................................................ Cal. Corp. Code § 17061 ' 4

3, 8 Cal. Corp. Code § 17451 .............................................................................................................

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1 I. 2

INTRODUCTION Plaintiff, Nutrishare, Inc. ("PlaintifF') greatly overstates the facts in its opposition to

3 Defendant BioRx, LLC's ("BioRx") Motion to Dismiss. BioRx does have very limited contacts 4 with California, but they are minimal at most, and are not the "substantial, continuous and 5 systematic" activities that are required to provide general jurisdiction and to drag an Ohio limited 6 liability company into federal court in California. BioRx is not authorized to conduct business in 7 California, is. not registered with the California Secretary of State, has no offices or employees 8 located in the state, does not own property in the state and has done no direct marketing nor 9 engaged in political activity of any kind in the state of California. 10 BioRx's limited contacts with the state of California are likewise not sufficient to subject it

11 to the specific jurisdiction of this Court. BioRx's NutriThrive product has only a handful of 12 dedicated employees, several of whom are part-time, and all of whom are located in Ohio and 13 Massachusetts. NutriThrive has a total of only 36 customers, the majority of whom are located in 14 the Boston area. NutriThrive has only 2 customers within the state of California, both of whom 15 are located in Southern California and receive "enteral only" products and services (which 16 Nutrishare does not provide). NutriThrive does not currently provide any TPN products or 17 services to customers within the state of California (contrary to Plaintiffs allegations based only 18 on internet web searches) and does not have any contractual relationships with any local nursing 19 agencies in California. 20 The fact that NutriTh~ve has an informational website that users in California can access,

21 has been represented at national conferences that periodically take place in California and has sent 22 non-competitive products to two customers in Southern California, does not demonstrate the type 23 of "pm~oseful availment" necessary to establish specific jurisdiction. Requiring this litigation to 24 proceed in Ohio would not be unreasonable, particularly given that Plaintiff is likewise registered 25 as a non-resident pharmacy within the state of Ohio, has an office and pharmacy located in 26 Louisville, Kentucky, and one of the declarants in support of Plaintiffs opposition to this motion 27 actually signed her declaration in Cleveland, Ohio. For these reasons, BioRx requests that its 28 motion to dismiss be granted.
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1 II. 2 3 4 5 6

ARGUMENT. A. The State of California Does Not Have General Jurisdiction Over BioRx Because BioRx Does Not Have Sufficient Contacts With California. 1. Mere Registration with the California Board of Pharmacy Does Not Automatically Confer General Jurisdiction over BioRx. As discussed in BioRx's opening brief, general jurisdiction exists when a defendant is

7 domiciled in the forum state or his activities there are substantial, continuous, and systematic. 8 Helieopteros Naeionales de Colombia v. Hall, S.A., 466 U.S. 408, 413-14 (1984). Plaintiffdoes 9 not contend, nor could it contend, that BioRx is incorporated in California, or that it has physical 10 facilities, employees or bank accounts there. However, Plaintiff contends that "[b]ased solely on 11 its appointment of [a process] agent, BioRx is subject to jurisdiction in California" (Plffs Opp. 12 (Doe. 30), p. 10). This is an obvious overstatement and misinterpretation of the law. 13 BioRx has registered as a non-resident pharmacy with the California State Board of

14 Pharmacy ("Pharmacy Board"), which was required prior to the shipment of any controlled 15 substances into California from outside the state. (See Cal. Bus. & Prof. Code §§ 4112(a) and (b), 16 4120(a); Declaration of Douglas Eric Hill in Support of Motion to Dismiss or Transfer ("Hill 17 Decl."), ¶¶ 3-4). In connection with its application, BioRx was required to designate an agent for 18 service of process in California. (See id.; Cal. Bus. & Prof. Code § 4112(c)(1)).1 Such an agent 19 enables the Pharmacy Board to bring legal action against a non-resident pharmacy to recover civil 20 penalties and enjoin violations of the California Pharmacy Law (Cal. Bus. & Prof. Code §§ 4120 21 et seq.), including requesting criminal prosecution. See, e.g., Cal. Bus. & Prof. Code §§ 4320, 22 4339. 23 24 25 26 27 28
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The statement in BioRx's opening brief, that BioRx does not have an agent for service of process in California, was incorrect and is hereby withdrawn. BioRx is not registered with the California Secretary of State, and thus does not have an agent for service of process listed with the Secretary of State, which was confirmed by defense counsel before filing the moving papers. Counsel for BioRx was unaware at the time of filing its moving papers that BioRx had been licensed by the Pharmacy Board and designated an agent for service of process through the Pharmacy Board (Wintersheimer Decl., ¶ 2-3). Counsel incorrectly referenced Mr. Reilly's declaration in support of its misstatement. However, Mr. Reilly's declaration did not say that there was no registered agent for service of process. Rather, it correctly stated simply that BioRx is not qualified to do business in California, which it is not. (Reilly Decl. (Doe. 273), ¶ 2).
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1

The California legislature has expressly rejected the very inference Plaintiff asks this Court

2 to make from BioRx's registration with the California Pharmacy Board as a non-resident 3 pharmacy. Specifically, the California legislature declared that in enacting the non-resident 4 pharmacy registration requirements, it "does not intend a license issued to any nonresident 5 7hartnacy pursuant to this section to serve as any evidence that the nonresident pharmacy is 6 toing business within this state." (Cal. Bus. & Prof. Code § 4120(d) (emphasis added); see also 7 § 4161 (license issued to out-of-state manufacturer or wholesaler does not serve as evidence that 8 such entity is doing business within the state)). Furthermore, registration with the California 9 Pharmacy Board does not give the Board unlimited jurisdiction to take action against an out-of10 state pharmacy. For example, the Board may not deny, revoke or suspend a non-resident 11 pharmacy registration for conduct that causes serious bodily or psychological injury to a 12 California resident unless it has first referred the matter to the regulatory or licensing agency in the 13 state where the pharmacy is located and that agency fails to initiate an investigation within 45 days 14 thereafter. (Cal. Bus. & Prof. Code § 4303(b)). Accordingly, registration as a non-resident 15 pharmacy alone does not - and cannot - serve as evidence that BioRx does business within the 16 state of California for purposes of establishing jurisdiction.2 17 In fact,. BioRx does not do business in California. As noted above, it has not registered

18 with the California Secretary of State, as it would be required to do if it were doing business here. 19 (Cal. Corp. Code § 17451). Similarly, it has not designated with the Secretary of State an agent 20 for service of process for actions such as the instant one brought by Plaintiff. (Id. at § 17061). 21 Accordingly, Plaintiffs reliance upon Morgan Stanley High Yield Secs., lnc. v. Jecklin, 2006 U.S. 22 Dist. LEXIS 53489 (D. Nev. July 28, 2006) for the proposition that voluntary compliance witha 23 state's corporation law is a significant contact for jurisdictional purposes, is irrelevant to the 24 current situation. 25 26 27 28
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Contrary to Plaintiffs assertion in their opposition, BioRx is unequivocally not licensed to "conduct sterile compounding activities within California." They are only licensed as a nonresident pharmacy, and are only licensed to compound drugs in their Ohio facility. (Hill Decl., ¶3.)
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1 2 3

2.

There is Insufficient Evidence of Any Other Contacts Between BioRx and California to Establish General Jurisdiction.

In addition to Plaintiffs arguments regarding BioRx's registration with the Pharmacy

4 Board, Plaintiff provides a smattering of other alleged "evidence" of contacts with California, 5 gathered from Google searches or other hearsay sources. These alleged "facts" are inaccurate and 6 unreliable, as demonstrated herein and as detailed in the accompanying Objections to Evidence 7 filed herewith. 8 Specifically, Plaintiff asserts that BioRx has business partners and "at least four customers"

9 in California, and hypothesizes that'BioRx "may have customers for its other product lines.., in 10 California," "may have contracts or relationships with local nursing agencies, other medical 11 professionals, and vendors," and "may also have California-based employees and/or sales 12 representatives." To the contrary, NutriThrive has only two customers in California. They are 13 both located in southern California, and receive enteral only services that do not compete with 14 Nutrishare's TPN product. (Nelly Decl. (Docl 27-3), ¶7 12-i3; Declaration of Deborah Pfister in 15 Support of Motion to Dismiss or Transfer ("Pfister Decl."), ¶ 8).3 To date, the total revenue 16 charged by BioRx for the NutriThrive product shipped to these customers is less than $5,000. 17 (Pfister Decl., ¶ 8). BioRx does not have any contracts or established relationships with nursing 18 agencies in California. (Id., ¶ 13). BioRx has no California-based employees or sales 19 representatives. (Id., ¶ 3; Rielly Decl., ¶ 2). For the twelve months ending July 31, 2008, BioRx 20 had total cash receipts of nearly $31 million - only $316.03 of which were for nut~tion services 21 provided in California. (Hill Decl., ¶ 10.) NutriThrive does not conduct any direct marketing 22 targeting residents of California. It has not issued any press releases in the state, has not 23 advertised with any local forms of media, and has conducted no "direct to physician" marketing in 24 the state. (Pfister Decl., ¶ 6). Further, NutriThrive has not engaged in any form of political 25 activity in California. (Id.). 26 27 28
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3

In addition to the two NutriThrive customers, BioRx does have one additional customer located in Granada Hills, California, who receives in-house Immunoglobulin G (IgG) infusion services. This is not a product offered by NutriThrive or Nutrishare. (Pfister Decl., ¶ 8.)
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1

Finally, Plaintiffs contention that BioRx is "business partners" in California with Bayer

2 Healthcare (whose offices are in the Northeast) is incon:ect and misleading. The only project that 3 BioRx has ever undertaken with Bayer Healthcare was in connection with Bayer's hemophilia 4 products division. BioRx and Bayer co-funded the publication of two children's education books 5 about hemophilia. The books were both created, printed, written and produced in North Carolina, 6 and were given to children with hemophilia for free, in order to educate them and their families 7 about the disease. This project has no connection to California and has no relationshl"p to TPN or 8 NutriThrive. (Hill Decl., ¶ 5). 9 10 11 3. Plaintif£s Case Authority is Inapplicable and Does Not Support a Finding of General Jurisdiction. In support of its argument for general jurisdiction, Plaintiff cites Tuazon v. R.J. Reynolds

12 Tobacco Co., 433 F.3d 1163, 1174 (9th Cir. 2006) and Mahroom v. Best Western Int'l, Inc., 2007 13 U.S. Dist. LEXIS 56006, *7 ~.D. Cal. 2007). These cases are inapposite and do not support 14 Plaintiffs arguments. In Tuazon, the court correctly found general jurisdiction appropriate 15 because of the extensive interactions the defendant, R.J. Reynolds, had with the state of 16 Washington. Specifically, R.J. Reynolds had been licensed to do business in Washington state 17 since 1940, had an office with up to 40 employees, advertised extensively in pure!y local and state 18 publications, and frequently engaged in sophisticated local political activity. In the four years 19 prior to the litigation, the defendant had generated $145-240 million in net cigarette sales in 20 Washington, each year, and its market share in the state was higher than its market share nation 21 wide. 433 F.3d 1163, 1174. Clearly, such facts have no relation to the current situation. 22 Similarly, in Mahroom, the court recognized that the defendant, Best Western Hotels, not

23 only had an agent for service of process in the state, but also regularly sent its employees and 24 agents to the state to inspect the hotel at issue in the litigation. Most importantly, however, was 25 the court's finding that the defendant regularly conducted business in the state, as evidenced by the 26 fact that it had ninety-four motels located within 100 miles of the courthouse. Moreover, neither 27 party in the action asserted that the court lacked personal jurisdiction. Instead, the issues related 28 only to whether venue was proper and the application of a forum selection clause. 2007 U.S. Dist.
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1 LEXIS 56006, *7. Needless to say, the facts in Mahroom are dramatically different than the facts 2 presented here. 3 As detailed above, BioRx's contacts with California were clearly "more occasional than

4 continuous, and more infrequent than systematic" and therefore do not suffice to establish general 5 jurisdiction. Gates Leafier Corp. v. Jensen, 743 F.2d 1325, 1330-1331 (9th Cir. 1984). For 6 instance,, in Gates, the court concluded there were insufficient contacts to create general 7 jurisdiction, even where the contacts were dramatically greater than BioRx's. Specifically, the 8 defendant's contacts with the state included solicitation of a distributorship agreement, multiple 9 visits to the state, purchase of parts within the state, and submission of letters and calls to the area 10 in question. The defendant had even designated the state's law in the contract's choice of law 11 provision. More similar to the current situation is the case of Kransco Manufacturing v. Markwitz, 12 656 F.2d 1376, 1377-1387 (gth Cir. 1981). There, the Court found there was no personal 13 jurisdiction because the defendant maintained no office, home or personnel in the state, and the 14 only contacts were letters sent within the state and defendant's presence at a trade show to promote 15 and take orders for the product. See also Data Disc, Inc. v. Systems Technology Associates, 557 16 F.2d 1280, 1283-1284, 1287 (gth Cir. 1977) (finding no personal jurisdiction over Florida 17 corporation with principal place of business in Virginia despi£e the fact that the contract at issue 18 was negotiated and executed in California, defendant's personnel visited the state on five 19 occasions, and one of defendant's employees was sent to California to work on the project for a 20 period of time). 21 In short, the current situation is far more similar to the Gates and Kransco cases and have

22 no relation whatsoever to the defendants in Tuazon and Mahroom. There are simply insufficient 23 contacts between BioRx and the state of California, let alone the systematic and continuous 24 contacts necessary to establish general jurisdiction. 25 26 B. This Court Does Not Have Specific Jurisdiction Over BioRx.

The Ninth Circuit uses a three-part test to determine if a defendant's contacts are

27 sufficiently related to the forum state to permit a district court to exercise specific jurisdiction: (1)

28 The nonresident defendant must do some act by which he purposely avails himself of the privilege
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1 of conducting activities in the forum; (2) the claim must be one wb~ich arises out of or results from 2 defendant's forum-related activities; and (3) exercise of jurisdiction must be reasonable. 3 Cybersell, Inc. v. Cybersell, Inc., 130 F.3d414, 416 (9th Cir. 1997); Burger King Corp. v. 4 Rudzewicz, 471 U.S. 462, 477-78 (1985). If any of the three requirements are not satisfied, 5 jurisdiction in the forum would deprive the defendant of due process of law. Pebble Beach Co. v. 6 Caddy, 453 F.3d 115.1, 1155 (9th Cir. 2006). 7 8 9 1. BioRx Has Not Purposefully Availed Itself of the Benefits and Privileges of California. Plaintiff argues that BioRx purposefully availed itself of California law by applying for

10 non-resident pharmacy licenses. (Pltfs Opp. (Doc. 30), p. 12). In its Opposition, Plaintiff cites 11 the decision of the District of Nevada in Morgan Stanley High Yield Secs., Inc. v. Jecklin, for the 12 proposition that "[e]ven if... Defendants... never conducted any business in Nevada besides 13 obtaining a license, voluntary compliance with a state's corporation law is a contact which 14 facilitates significant privileges for conducting activities within that state." 2006 U.S. Dist. LEXIS 15 53489, * 7-8 (D. Nev. 2006). In Morgan Stanley, the plaintiff sought to enforce a New York 16 judgment for default on a note purchase agreement against a corporate entity by piercing the 17 corporate veil and holding the individual defendants responsible. The plaintiff argued that specific 18 jurisdiction against the individual defendants existed because they purposefully availed 19 themselves of the state's laws by their acquisition of a gaming license, conduct of business in the 20 state, ownership of a personal residence, and personal investment in the resort that was the subject 21 of the underlying judgment. The court concluded that the defendant's registration to do business 22 within the state was sufficient because it allowed them to conduct business with the state. 23 As such, Morgan Stanley and likewise, Mahroom, 2007 U.S. Dist. LEXIS 56006 (see

24 Section A.3, supra), cited for a similar proposition, are inapplicable to the current situation. 25 BioRx does not regularly conduct business in California and, accordingly, has not been required to 26 and has not registered with the California Secretary of State. (Cal. Corp. Code § 17451 (a)). 27 BioRx has merely obtained permits from the Pharmacy Board as a non-resident pharmacy, 28 permitting it to ship its products into the state. By doing so, BioRx did not subject itselft~ the
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1 jurisdiction of California courts in relation to a trademark infringement suit brought by Plaintiff. 2 As detailed above, the California legislature has explicitly cautioned that the issuance of such a 3 license is not to be used as evidence that the nonresident pharmacy is doing business within the 4 state. (Cal. Bus. Prof. Code § 4120(d)). Although BioRx is subject to the jurisdiction of the 5 California Pharmacy Board in relation to violations of the California Pharmacy Law, the current 6 litigation has nothing to do with BioRx's use of its pharmacy license. 7 8 2. BioRx Has Not Purposefully Directed its Activities Toward California.

When a defendant has been alleged to have committed some type of tortious conduct, the

9 Ninth Circuit courts apply the "Calder effects" test requiring that personal jurisdiction be 10 predicated on (1) intentional actions that are (2) expressly aimed at the forum state, and (3) cause 11 harm, "the brunt of which is suffered - and which the defendant knows is likely to be suffered - in 12 the forum state." Core-Vent v. Nobellndustries, 11 F.3d 1482, 1486 (gth Cir. 1993); Bancroft & 13 Masters v. Augusta National, 223 F.3d 1082, 1087 (9th Cir. 2000). Plaintiff contends that BioRx 14 has purposefully availed itself of the privileges of conducting business by intentionally infringing 15 Plaintiffs mark, with full knowledge of Nutrishare, its location, and its mark." (Pltfs Opp. (Doc. 16 30), p. 15). Plaintiff, of course, cites no evidence in support of this allegation of intentional 17 infringement. 18 The evidence, however, shows that BioRx did not inter~tionally infringe Plaintiffs mark.

19 In fact, BioRx's "NutriThrive" name was selected independent of, and without any reference to, 20 Plaintiff's "Nutrishare" mark. BioRx utilized the services of independent consultants who 21 ultimately selected the NutriThrive name based upon the "Thrive" component of the name. 22 (Pfister Decl., ¶ 15). NutriThrive filed applications at the US Patent and trademark offices to 23 register the NutriThrive mark, and such applications were allowed, after examinationby an 24 Examining Attorney, with no citation to the Nutrishare mark as being confusingly similar. 25 Further, the actual use of the marks shows the lack of intentional infi-ingement. The logos of the 26 two companies are in different typeface, different colors, and contain very different logo features. 27 If BioRx had intended infringement, one would expect a great deal of similarity in these features. 28 (Id., ¶ 16).
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1

Moreover, BioRx has not "expressly aimed" any allegedly infringing conduct at California.

2 BioRx has shipped NutriThrive product to only two customers in California, and only products 3 that do not compete with Plaintiffs Nutrishare TPN product. (Pfister Decl., ¶¶ 4-5, 8-9). The .4 enteral product sells for approximately $600 per month, and involves the use of feeding tubes. To the contrary, the TPN product consists of feeding the patient intravenously, and sells for nearly 6 $6,000 per month. (Id., ¶ 8). Plaintiffs allegation that BioRx has sold infi~ging products or 7 services in California is simply untrue. ¯ 8 Nor does BioRx perform any direct marketing of NutriThrive directed at California

9 residents or phys!cians. (Id., ¶ 6). Although it attended the Oley Conference in San Diego, California, there was no "California specific" marketing conducted during the event at any time 11 no press releases, no advertising in local media and no meetings with doctors or potential 12 customers. (Id., ¶ 6). It has sent one letter, including an orientation package, to a person who 13 called to inquire about BioRx's NutriThrive products, and had a California address; but that 14 customer has not followed up or purchased any services from BioRx. (Id., ¶ 10, Exhibit A). 15 Further, apparently that potential customer is named Katherine Bundy, and signed a declaration in 16 this matter submitted with Plaintiffs opposition papers, that was signed on July 25, 2008, in 17 Cleveland, Ohio - not California. (Bundy Decl. (Doe. 33), p. 3, line 6). As discussed above, 18 Plaintiffs allegations that BioRx has established relationships with California nursing agencies are 19 also categorically false. (Pfister Decl., ¶ 8). 20 Finally, Plaintiff contends that BioRx's website opens them to specific jurisdiction in

21 California. The Ninth Circuit's test for jurisdiction in cases involving websites is the "level of 22 interactivity and commercial nature of the exchange of information that occurs on the Web site to 23 determine if sufficient contacts exist to warrant the exercise of jurisdiction." Cybersell, Inc. v. 24 Cybersell, Inc., 130 F.3d414, 418. (9th Cir. 1997), citing Zippo Mfg. Co. v. Zippo Dot Corn, Inc., 25 ~52 F. Supp. 1119, 1124 (W.D. Pa. 1997). As Plaintiff acknowledges, a "passive" website, 26 without specific action to encourage residents of the forum state to use the website and do 27 business with the defendant, is insufficient to warrant a finding of jurisdiction. E.g., Pebble Beach 28 Co. v. Caddy, 453 F.3d 1151, 1156 (9th Cir. 2006). Only an "interactive" website, where users
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1 can exchange information with the host computer, is relevant for jurisdictional purposes. 2 Cybersell, 130 F.3d at.418. 3 BioRx'~ NutriThrive website does not reach the level of interactivity and commercial

4 nature contemplated by the Cybersell court. The NutriThrive website has a "discussion board" 5 with eight members, a "contact us" page with a listing of e-mail addresses and phone numbers and 6 a referral page. Of critical importance to this analysis is whether a user of the website can 7 purchase product or place orders on the website. Visitors to the NutriThrive site are not permitted 8 or able to purchase products over the internet. Rather, products can only be purchased with a valid 9 prescription and under controlled situations as with other pharmacy products. (Pfsiter Decl., ¶ 14). 10 See Goodman Ball, Inc. v. Clear Water USA, Inc., 2007 U.S. Dist. LEXIS 83996, "9-10 (N.D. Cal. 11 2007) (finding lack of personal jurisdiction based on website that displayed products for sale and 12 allowed visitors to request further information but did not allow visitors to place orders on the 13 site); New Tech Stainless Steel Prods. Co. v. Sun Mfg. Corp., 2004 U.S. Dist. LEXIS29132, *1014 11 (C.D. Cal. 2004) (website that "does not permit the user to actually place product orders" and is 15 "purely information" does not rise to the level ofinteractivity that warrants an assertion of 16 personal jurisdiction). 17 Plaintiff alleges that BioRx's website "touts" its licenses "to conduct business in most

18 states"; and "boasts" of a clinical staff that "reaches all 50 states". While this information is 19 contained on the website, it is hardly prominent, as the Court will easily determine from a quick 20 review of Exhibit B to Okamoto's declaration (Doc. 31), and is insufficient to establish specific 21 jurisdiction. Such innocuous statements on a website ~re not the same as running directed, 22 purposeful advertisements within the forum state. Cf Rio Props v. Rio Int'l Interlink, 284 F.3d 23 1007, 1020 (9th Cir. 2002) ("All told, Rlrs actions in Nevada, including its radio and print 24 advertisements, demonstrate an insistent marketing campaign directed toward Nevada") (empfiasis 25 added). Nor is an announcement regarding a conference held within the forum state, such as the 26 Oley conference, the same as releasing multiple press releases specifically targeted at the forum 27 state. See Telco Communications v. ANApple A Day, 977 F. Supp. 404, 407 (E.D. Va. 1997) 28 (multiple press releases in the forum rise to the level of regularly doing or soliciting business).
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1

In fact, each of the cases cited by Plaintiff in support of its contention that BioRx has done

2 "something more" contain actions far beyond any cited by Plaintiff in support of its arguments. 3 See Panavision Int'lv. Toeppen, 141 F.3d 1316, 1322 (9th Cir. 1998) (defendant knew that his 4 registration of Panavision's trademarks as his domain names for the s01e purpose of extorting 5 money had the effect of injuring Panavision at its principal place of business in California); 6 Bancroft & Masters, Inc. v. Augusta NationalInc., 223 F.3d 1082, 1088 (9th Cir. 2000) (defendant 7 knew that letter sent to Network Solutions, Inc. challenging plaintiffs use of domain name was 8 targeting a California corporation); Digital Equipment Corp. v. Altavista Technology, Inc., 960 9 F.Supp. 456, 462 (D. Mass. 1997) (website coupled with contract with a forum state corporation 10 agreeing to apply forum state law, soliciting forum state business through the website, and three 11 sales to forum state residents together and more constituted personal jurisdiction). The actual 12 items contained on the BioRx website do not equate to the extensive and purposeful contacts with 13 the forum displayed in the cases cited by Plaintiff. i4 Moreover, even if the court were to find BioRx's web site is not purely passive, Plaintiff

15 still cannot show purposeful availment based upon the website alone. Amini Innovation Corp., v. 16 JSImports, Inc., 497 F. Supp. 2d 1093, 1103-1104 (C.D. Cal. 2007) (plaintiff failed to show the 17 defendant's purposeful availment or California business done via the web site; "the court is not 18 prepared to broadly hold.., that the mere act of maintaining an interactive website that includes 19 interactive features ipso facto establishes personal jurisdiction over the sponsor of that website 20 anywhere in the United States"). 21 BioRx has neither purposefully availed itself of the privileges and benefits of California 22 nor purposefully directed its activities to California.4 23 24 25 26 27 28
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Plaintiff has submitted a Declaration from its President, Rodney Okamoto, in which he discusses at length BioRx's participation in an Oley conference in San Diego, California in late June, 2008. Indeed, its appears from the record and from Plaintiffs Opposition that Plaintiff made a calculated decision to file its Complaint on June 4, 2008, and then serve it when BioRx appeared for the Oley conference later that month. As explained in BioRx's opening brief, however, its participation in the Oley conference is irrelevant for purposes of the jurisdictional analysis because it occurred after Plaintiff filed its Complaint in this action. See Farmers Ins. Exch. v. PortageLaPrairieMut. Ins. Co., 907 F.2d 911,913 (9th Cir. 1990).
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1 2 3

C.

This Court Should Dismiss Plaintiff's Claim Because it Does Not "Arise Out of" BioRx's Attenuated Contacts with California.

Plaintiff cites no evidence to contradict the showing made by BioRx that its two

4 NutriThrive customers in southern California receive enteral nutrition products only, a product 5 unrelated to Plaintiffs Nutrishare TPN product. Plaintiff contends, however, that its claims 6 somehow arise from the product supplied to those two customers because, under Sleekcraft,5 7 competition of products is supposedly not required. (Plffs Opp. (Doc. 30),pp. 19,21). 8 However, in determining whether the public is likely to be confused about the source of a

9 product, courts assess whether the goods are r.elated or complementary. AMF, Inc. v. Sleekcraft 10 Boats, 599 F.2d 341,350 (9th Cir. 1979). Courts also assess whether the marketing channels are 11 "parallel" so that "the general class of... purchasers exposed to the products overlap." Id. at 353. 12 Plaintiff contends that because some of its TPN customers do incidentally receive enteral

13 nutrition services, BioRx's provision of solely enteral services to two California customers 14 somehow "give rise" to Plaintiffs claims for infringement of its Nutrishare mark. This contention 15 is specious, and directly contradicts the sworn testimony of Plaintiffs President that Plaintiff 16 focuses exclusively on TPN services. (Okamoto Decl. in Supp. of Mot. for Preliminary Injunction 17 (Doc. 7), ¶ 2). While Plaintiff may provide some limited enteral nutrition services to some of its. 18 customers, it provides those services only in conjunction with its TPN services and only for 19 existing TPN customers. (Pfister Decl., ¶ 9). Unlike BioRx, Plaintiff does not market enteral 20 nutrition as a sole therapy offering, nor will Plaintiff provide enteral nutrition to customers who do 21 not require TPN. (Id.). In fact, BioRx has at least one enteral therapy c~stomer in Olfio who was 22 formerly a Nutrishare TPN and enteral customer. When he no longer required TPN and only 23 24 25 26 27 28
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In a Lanham Act claim, the plaintiffmust show: (1) "that it owns a valid mark, and thus a protectable interest," and (2) "that the alleged infringer's use of the mark is likely to cause confusion." KP Permanent Make-Up, Inc. v, Lasting Impression L Inc., 408 F.3d 596, 602 (9th Cir. 2005). The Sleekcraf! decision established a multi-factor test for determining whether a user's mark is likely to cause confusion: (1) strength of the mark; (2) proximity of the goods; (3) similarity of the ma~ks; (4) evidence of actual confusion; (5) marketing channels used; (6) type of gOods and the degree of care likely to be exercised by the purchaser; (7) defendant's intent in selecting the mark; and (8) likelihood of expansion of the product lines. AMF, Inc. v. Sleekcraft Boats, 599 F.2d 341,348-49 (9th Cir. 1979).
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1 required enteral nutrition, Plaintiff would no longer provide service to him. As a result, he became 2 a customer ofNutriThrive. (Id.). 3 The only NutriThrive products or services that BioRx provides to its California customers

4 are stand-alone enteral products. These products are distinct from and unrelated to the TPN 5 products distributed by Plaintiff. BioRx's understands and believes that Plaintiff does not provide 6 enteral therapy products or services on a stand-alone basis. Customers seeking enteral nutrition 7 are not seeking TPN, thus, the "general class of purchasers" do not overlap. Sleekcraf, 599 F.2d 8 at 353. Accordingly, Plaintiff's contention that its claims for infringement of its marks arise from 9 activities by BioRx in California has no merit whatsoever. 10 11 D. The Exercise of Personal Jurisdiction Over BioRx is Not Reasonable. The Ninth Circuit has articulated seven factors to determine whether the exercise of

12 jurisdiction over a nonresident defendant would be reasonable, none of which is dispositive, but 13 all of which the Court must consider: 14 15 16 17 18 19 Core-Vent Corp. v. NobelIndus., 11 F.3d 1482, 1487-88 (9th Cir. 1993). 20 21 1. . Purposeful Interjection. "The smaller the element ofpurp0seful interjection, the less is jurisdiction to be anticipated (1) the extent of the [defendant's] purposeful interjection into the forum state's affairs; (2) the burden on the defendant of defending in the forum; (3) the extent of conflict with the sovereignty of the [defendant's] state; (4) the forum state's interest in adjudicating the dispute; (5) the most efficient judicial resolution of the controversy; (6) the importance of the forum to the plaintiffs interest in convenient and effective relief; and (7) the existence of an alternative forum.

22 and the less reasonable is its exercise." Insurance Company of North America v. Marina Salina 23 Cruz, 649 F.2d 1266, 1271 (9th Cirl 1981). If a party has purposefully availed itself of the 24 privilege of conducting activities within the forum state, there is often no need to analyze this 25 factor separately. See Roth v. Garcia Marquez, 942 F.2d 617, 622 (9th Cir. 1991).~ However, as 26 explained in detail above, BioRx has not purposefully availed itself of the privileges or 27 purposefully directed its activities within California. The extent of BioRx's contacts within 28
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1 California consist of three total customers of non-TPN products6, a visit to an Oley Conference 2 after Plaintiffs Complaint was filed, a passive website, and a non-resident pharmacy license and 3 accompanying agent for service of process. These contacts fall far short of the level required to 4 show purposeful interjection. See Panavision, 141 F.3d at 1323 (registration of Panavision's 5 trademarks as domain names and sending letter to Panavision in California demanding $13,000 for 6 release of domain name constitutes purposeful interjection). 7 8 2. Burden on Defendant.

BioRx has its principal place of business in the state of Ohio and has no office or

9 headquarters located within California. It has no employees, representatives, or witnesses there. 10 Substantially all of the witnesses that BioRx would call in this action are domiciled within the 11 states of Ohio, North Carolina and Massachusetts. All of BioRx's records and documentation 12 surrounding its marketing, advertising, and sales decisions related to NutriThrive are located in 13 Ohio. NutriThrive currently has only 36 customers, the majority of whom are located in the 14 Boston area and has only a handful of employees, all located in either Ohio or the Boston area. 15 While email and electronic communication may lessen the burden in discovery, the expense of 16 litigating the action within California would be high. 17 Plaintiff, to the contrary, would not have the same inconvenience in litigating this .matter in

18 Ohio. Nutrishare is licensed by the Ohio State Board of Pharmacy, and has offices and a 19 pharmacy located in Louisville, Kentucky, which is approximately 100 miles from Cincinnati, 20 Ohio. (Hill Declaration, ¶ 6). As discussed above, while BioRx has provided no TPN services to 21 any California resident, Plaintiff formerly provided TPN services to a customer in Ohio until that 22 customer no longer required TPN and then came to NutriThrive. Moreover, Katherine Bundy, 23 who filed a declaration on behalf of Plaintiffs opposition to this motion, signed the Declaration in 24 Cleveland, Ohio. (Bundy Decl. (Doc. 33), p. 3, line 6). Given the extensive costs involved in 25 litigating the matter in California, the minimal contacts that BioRx has with the state, and the fact 26 27 28 6
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TWO NutriThrive enteral only customers and one in-home Immunoglobulin G .(IgG) infusion services customer. (Pfister Decl., ¶ 8.)
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1 that Plaintiff has connections with the state of Ohio and surrounding area, the burden on BioRx ' 2 would be unreasonably high. 3 4 3. Extent of Conflict with Sovereign ,ty of Foreign State.

As conceded by Plaintiff, this factor has no applicability to this analysis "because there is

5 no conflict between the sovereignty of Ohio and California." (Pltfs Opp. (Doe. 30), p. 23). .6 7 4. Forum State's Interest kn Adiudieation.

This factor traditionally favors jurisdiction due to the fact that plaintiffs generally file

8 tortious claims in their home state and states have a strong interest in protecting their citizens from 9 injury..See Shute v. Carnival Cruise Lines, 863 F.2d 1437, 1446 (9th Cir. 1988). However, this 10 factor is outweighed when compared to the unreasonable burden imposed upon BioRx in litigating 11 this matter in California and the lack of any real purposeful interjection in the state of California. 12 Plaintiff makes much of the fact that BioRx is licensed to sell its pharmacy products in all 50 13 states. Plaintiff, of course, is also licensed in most, if not all states, including Ohio. (Hill Decl., ¶ 14 6). California has no unique interest in adjudicating Plaintiffs claims. 15 16 5. Most Efficient Judicial Resolution.

"This factor focuses on the location of the evidence and witnesses." Panavision, 141 F.3d

17 at 1324. The operative facts and evidence regarding Plaintiffs claims of alleged trademark 18 infringement and unfair competition stem from the business, marketing, advertising and sales 19 decisions of BioRx in Ohio. Therefore, the majority of evidence and witnesses will reside in or be 20 stored within Ohio itself. Plaintiff, of course, focuses upon its own witnesses and evidence but 21 fails to address the substantial testimony and documentary evidence that is based in Ohio, and as 22 noted above, fails to point out that one of its declarants signed her declaration in Cleveland, Ohio, 23 that Nutrishare is licensed in Ohio and that Nutrishare has offices and a pharmacy.in Louisville, 24 Kentucky. Further, given BioRx's minimal contacts with the state and the lack of credible 25 evidence of infringement, it is clear that the majority of evidence involved in this action will come 26 from Ohio or even Massachusetts, but certainly not from California. 27 28
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1 2

6.

Convenience and Effectiveness of Relief for Plaintiff.

Plaintiff claims, with no citation to authority or evidence, that this forum is the only place

3 where it will be able to "effectively litigate its state law unfair competition claims." (Pltf's Opp. 4 (Doc. 30), p. 23). This assertion is patently erroneous. Even if substantive California law were 5 deemed to apply (which is doubtful), the qourts of Ohio are more than.competent to follow and 6 apply California law. 7 8 7. Availability of Alternative Forum.

It is the burden of the plaintiff to prove the unavailability of an alternative forum. Roth,

9 942 F.2d at 624. In its Opposition, Plaintiff argues that while BioRx may believe .that this lawsuit 10 should have been filed in Ohio, that is only an issue when the forum state isshown to be 11 unreasonable. (Pltfs Opp. (Doc. 30), pp. 23-24). However, Plaintiff has made no attempt_ to meet 12 its burden of showing that there is no other forum available to hear its claims. Naturally, any such 13 assertion would not be credible. 14 A review of these factors taken together as a whole clearly demonstrates that forcing

15 BioRx to litigate this case in California, given its isolated and attenuated contacts there, would be 16 an unreasonable burden and a deprivation of due process. 17 18 19 E. Alternatively, the Court Should Transfer This Case to the Southern District of California. Although BioRx denies that personal jurisdiction exists within the state of California,

20 should the Court find that personal jurisdiction is proper in California, venue should be held in the 21 Southern District of California. BioRx's only relevant, contacts with the state of California consist 22 of a non-resident pharmacy license and related appointed process server in California, three non23 TPN customers, and attendance at the Oley Conference in San Diego, California. As discussed 24 above, the only customers are located in Southern California. Plaintiffs contention that BioRx has 25 other customers in the Eastern District is wrong. (Pfister Decl., ¶ 8). The mere fact that the 26 Pharmacy Board happens to be located in the Capitol city of Sacramento does not transform 27 BioRx's non-resident pharmacy licensure into a "contact" with the Eastern District - otherwise, 28
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1 every foreign corporation that holds a license or is qualified to do business in California would be 2 subject to suit in the Eastern District. 3 Thus, if the Court determines that these limited contacts are sufficient for general or

4 specific jurisdiction over BioRx, personal jurisdiction (and thus venue) is proper within the 5 Southern District of California, pursuant to 28 U.S.C. § 1391(b)(2). 6 The Court has discretion pursuant to 28 U.S.C. § 1406(a) to dismiss this action, or to

7 transfer it to a proper venue. Plaintiffs discussion of Section 1404 is misplaced. BioRx is not 8 seeking permissive transfer based~upon the convenience of witnesses, etc. 9 III. 10 CONCLUSION For all of the foregoing reasons, Defendant, BioRx respectfully requests that this Court

11 dismiss this action for lack of personal jurisdiction. Alternatively, if the Court finds that the 12 exercise of jurisdiction is appropriate, then BioRx requests that the Court dismiss the action 13 pursuant to 28 U.S.C. § 1406 or, in its discretion, transfer the action to an appropriate venue. 14 15 Dated: August 4, 2008 16 17 18 19 20 21 22 23 24 25 26 27 28
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ALLEN MATKINS LECK GAMBLE MALLORY & NATSIS LLP By: s/Amy Wintersheimer Findley AMY WINTERSHEIMER FINDLEY Attorneys for Defendant BIoRX, LLC

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1 AMY WINTERSHEIMER FINDLEY (BAR NO. 163074) MICHAEL R. ADELE (BARNO. 138339) 2 CHARLENE J. WILSON (BAR NO. 222497) ALLEN MATKINS LECK GAMBLE 3 MALLORY & NATSIS LLP 501 West Broadway, 15th Floor 4 S an Diego, California 92101-3541 Phone: (619) 233-1155 5 Fax: (619) 233-1158 E-Mail: [email protected] 6 [email protected] [email protected] 7 Attomeys for Defendant 8 BIoRx, LLC 9 10 11 12 NUTRISHARE, INC., a California corporation,Case No. 2:08-cv-01252-WBS-EFB 13 14
V.

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA

Plaintiff,

Complaint filed June 4, 2008

15 BIORX, LLC, an Ohio Limited Liability Company, 16 Defendant. 17 18 19 20 21 I, Amy Wintersheimer Findley, declare: 1.

DECLARATION OF AMY WINTERSHEIMERFINDLEY IN SUPPORT: OF DEFENDANT'S MOTION TO DISMISS OR TRANSFER VENUE PURSUANT TO FRCP RULE 12(b)(2) AND

(3)

DATE: TIME: DEPT: JUDGE:

August :11, 2008 " 2:00 P.M. Courtroom 5 Hon. William B. Shubb

I am an attorney admitted to practice before the above,captioned court, and I am a

22 partner with the law firm of Allen Matkins Leek Gamble Mallory & Natsis LLP, attorneys for 23 Defendant BioRx, LLC ("Defendant" or "BioRx") in the above-captioned action. I am one of the 24 attorneys responsible for handling this matter on behalf of Defendant. The following facts are 25 within my own personal knowledge and, if called upon to do so, I could and would competently 26 testify personally thereto under oath. 27 ///// 28 IIIII
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1

2.

We were retained to work on this matter for BioRx on July 11, 2008 and have not

2 previously represented BioRx. We are working on this matter in conjunction with BloRx's 3 primary counsel located in Cincinnati, Ohio. Prior to filing the motion to dismiss, .which 4 contained the assertion that BioRx did not have an agent for service of process in Califomia, a 5 search of the Califomia Secretary of State's website was conducted, to confirm that BioRx was not 6 registered as doing business in the state and that no agent for service of process had been :

7 designated with the Secretary of State. Based on that review and discussions with the client, the 8 statement was erroneously made in the moving brief that BioRx did not have an agent for service 9 of process in the state. I was not aware that BioRx was registered with the California Board of 10 Pharmacy at that time, and was not aware that they had identified an agent for service of process 11 as a result of that registration.. 12 I declare under penalty of perjury under the laws of the United States of America that the

13 foregoing is true and correct. 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
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Executed on August 4, 2008 at San Diego, California.

s/Amy Wintersheimer Findley AMY WINTERSHEIMER FINDLEY

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1 AMY WINTERSHEIMER FINDLEY (BAR NO. 163074) MICHAEL R. ADELE (BAR NO. 138339) 2 CHARLENE J. WILSON (BAR NO. 222497) ALLEN MATKINS LECK GAMBLE 3 MALLORY & NATSIS LLP 501 West Broadway, 15th Floor 4 San Diego, California 92101-3541 Phone: (619) 233-1155 5 Fax: (619) 233-1158 E-Mail: [email protected] 6 [email protected] cwilson@allenmatkins, com 7 Attomeys for Defendant 8 BIoRx, LLC 9 10 11 12 NUTRISHARE, INC., a California corporation, Case No. 2:08-cv-01252-WBS-EFB 13 14 15 BIORX, LLC, an Ohio Limited Liability Company, 16 Defendant. 17 18 19 20 21 I, Douglas Eric Hill, hereby declare: 1. I am the Vice President and a Member of BioRx, LLC, an Ohio limited liability Plaintiff, Complaint filed June 4, 2008
DECLARATION OF DOUGLAS ERiC HILL IN SUPPORT OF DEFENDANT'S MOTION TO DISMISS OR TRANSFER VENUE PURSUANT TO FRCP RULE 12(b)(2) AND (3)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA

DATE: TIME: CRTM: JUDGE:

August 11, 2008 2:00 p.m. 5 Hon. William B. Shubb

22 ¯ company. I work and reside in High Point, North Carolina. 23 2. I oversee the operations of BioRx and, in that capacity, I was involved in the

24 applications by BioRx for licensure with the California State Board of Pharmacy as a non-resident 25 pharmacy (license no. 819) and as a non-resident provider of sterile compounding (license no. 26 99504). 27 ///// 28 /////
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1

3.

The non-resident pharmacy application submitted by BioRx in January, 2008 is

2 attached as Exhibit E to the Declaration of Aparna Rajagopal Durbin filed in his matter on July 28, 3 2008. This application contains my signature as Vice President and Member of BioRx. The 4 Pharmacy Board requires that a non-resident pharmacy such as BioRx obtain a non-resident 5 license before shipping any controlled substances into California from outside the state. BioRx 6 holds similar non-resident licenses in the other 49 states in which it does not reside, and it holds a 7 resident license in Ohio, where BioRx is headquartered. BioRx is registered with the California 8 Pharmacy Board as only a non-resident sterile compounding provider. I have reviewed the 9 Plaintiffs Opposition papers filed in this matter, including their contention that BioRx is "licensed 10 to conduct sterile compounding activities within the state of California". This is incorrect. We are 11 not licensed to conduct sterile compounding activities within the state of California. We are only 12 licensed to compound drugs in our Ohio facility. 13 4. As a condition of non-resident licensure in California, the Pharmacy Board requires

14 that the non-resident pharmacy designate an agent for service of process in California, for the 15 purpose of enabling the Pharmacy Board to bring legal action against a non-resident pharmacy to 16 recover civil penalties and enjoin violations of the California Pharmacy Law. I understand, 17 however, that the California legislature has stated its intention that obtaining such a non-resident 18 license is not to be considered as evidence that the non-resident pharmacy is "doing business in 19 California." As detailed in the Declarations filed in this matter by Phillip C. Nelly and Deborah 20 Pfister, BioRx does not "do business" in California. 21 5. I have reviewed the filings and declarations made by Plaintiff, Nutrishare, in this

22 matter. Plaintiff's contention that BioRx is "business partners" in California with Bayer 23 Healthcare is incorrect. Bayer Healthcare's United States consumer operations are based in 24 Morristown, New Jersey. The only project that BioRx has ever undertaken with Bayer Healthcare 25 was in connection with Bayer's hemophilia products division. BioRx and Bayer co-funded the 26 publication of two children's education books about hemophilia. The books were both created, 27 printed, written and produced in North Carolina, and were given to children with hemophilia for 28 free in order to educate them and their families about the disease. While some California residentg
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1 may have received a free copy of one or both books, this project has no connection to California 2 and has no relationship to TPN or NutriThrive. 3 6. AccOrding to Nutrishare's website, as well as my independent knowledge,

4 Nutrishare has an office, which includes a pharmacy, in Louisville, Kentucky, in addition to its 5 office in Elk Grove, .California. Louisville is approximately 100 miles from Cincinnati, Ohio, 6 where BioRx is located. In addition, to my knowledge, Nutrishare, like BioRx, has pharmacy 7 licenses in most, if not all states. Attached hereto as Exhibit A is a copy of a record from the Ohio 8 State Board of Pharmacy, showing that Nutrishare has held a license in Ohio since July 20, 2001. 9 7. Nutrishare's websi