Truinject Corp. v. Nestle Skin Health, S.A., et al

Filing 193

MEMORANDUM ORDER re 169 REPORT AND RECOMMENDATION and 178 REPORT AND RECOMMENDATION are ADOPTED re pending motions to dismiss (D.I. 117, 119, 121, 123, and 125) (See Order for further details). Signed by Judge Leonard P. Stark on 3/17/20. (ntl)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICTOF DELAWARE

TRUINJECT CORP.,

Plaintiff,
C.A. No. 19-592-LPS-JLH

V.

NESTLE SKIN HEAL TH. S.A., GALDERMA
S.A., GALDERMA LABORATORIES, L.P. ,
NESTLE SKIN HEAL TH, INC., JOHN
ROGERS, STUART RAETZMAN, SCOTT
MCCREA, ALISA LASK and TIPHANY
LOPEZ,
Defendants.

MEMORANDUM ORDER

At Wilmington this 17th day of March, 2020:
WHEREAS , the above-captioned matter was transferred to this Court from the U.S.
District Court for the Central District of California on March 28, 2019 (see D.I. 100, 101 , 102);
WHEREAS, the parties' joint statement pursuant to Local Rule 81.2 identified pending
motions at the time of transfer, to be re-filed following PlaintiffTruinject Corp. ("Truinject")
amending its pleading (D.I. 106);
WHEREAS, on May 29, 2019, Truinject filed its Amended Complaint (D.I. 112), and,
between July 8 and 17, 2019, defendants filed various motions to dismiss (see D.I. 117, 119, 121 ,
123, 125);
WHEREAS, Magistrate Judge Hall issued a 27-page Report and Recommendation
(D .I. 169) ("Report I"), dated December 13, 2019, recommending that the Court grant Defendant

Nestle Skin Health, S .A.' s motion to dismiss all claims against it for lack of personal jurisdiction
under Federal Rule of Civil Procedure 12(b)(2) (see D.I. 123);
WHEREAS, on December 27, 2019, Truinject objected to Report I (D.I. 175)
("Objection"), arguing Judge Hall erred in: (1) noting that Truinject's drafting strategies when
referring to the various corporate defendants in the Amended Complaint made it difficult to
discern which defendants performed what acts for the purpose of assessing jurisdiction (see id. at
4-5), (2) concluding that the transferor court did not find Delaware had personal jurisdiction over
Nestle Skin Health, S.A. (see id. at 6-7), (3) determining that Nestle Skin Health, S.A. was not
bound by the 2014 or 2016 Confidential Disclosure Agreements' ("CDA") Delaware forum
selection clause (see id. at 7-10), and (4) denying Truinject's request for jurisdictional discovery
(see id. at 1O);

WHEREAS, on January 10, 2020, Nestle Skin Health, S.A. responded to the Objection
(D .I. 181) ("Response");
WHEREAS, the Court has considered the Objection de novo, as the motion to dismiss
presents a case-dispositive issue, see Brasure 's Pest Control, Inc. v. Air Cleaning Equipment,
Inc., 2018 WL 337747, at *1 (D. Del. Jan. 9, 2018); 28 U.S.C. § 636(b)(l);

WHEREAS , Truinject acknowledges failures to comply with this Court's Standing Order
for Objections Filed Under Fed. R. Civ. P. 72, dated October 9, 2013 ("Standing Order"), which
requires, among other things, a written statement either certifying that the objections do not raise
new legal/factual arguments, or identifying the new arguments and describing the good cause for
failing to previously raise the new legal/factual arguments before the Magistrate Judge (see
D.I. 182);

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WHEREAS, on January 7, 2020, Judge Hall issued a 39-page Report and
Recommendation (D.I. 178) ("Report II"), recommending that the Court grant-in-part and
deny-in-part separate motions to dismiss filed by Defendants Galderma S.A. and Galderma
Laboratories, L.P. (D.I. 117), Defendants Stuart Raetzman, Scott McCrea, Tiphany Lopez, and
Alisa Lask (D.I. 119), Defendant Skin Nestle Health Inc. (D.I. 121), and Defendant John Rogers
(D.I. 125);
WHEREAS , objections to Report II were due by January 21, 2020, and none were filed ;
WHEREAS , on January 21 , 2020, Truinject sent an unsolicited letter to the Court stating
that, in the event Report II is adopted, then Truinject intends to amend its Amended Complaint to
address deficiencies identified in Report II 1 and further that "Truinject anticipates the Second
Amended Complaint will contain multiple new claims against defendants" (D.I. 184);
WHEREAS , on January 23 , 2020, Defendants Galderma S.A., Galderma Laboratories,
L.P., Nestle Skin Health, Inc. , John Rogers, Stuart Raetzman, Tiphany Lopez, Scott McCrea, and
Alisa Lask responded to Truinject' s January 21, 2020 letter, arguing that Judge Hall ' s
recommended scope of leave to amend is limited to the deficiencies identified in Report II, and,
therefore, Truinject is not entitled to add "new claims" not pled in the Amended Complaint,
without first seeking and obtaining leave to do so pursuant to Federal Rules of Civil Procedure
15(a) and 16(b) (see D.I. 185);

1

Truinject states that it "will amend" with respect to "tortious interference; breach of
contract against Nestle Skin Health, Inc.; and breach of the implied covenant of good faith and
fair dealing." (D.I. 184 at 1) Truinject is not clear as to whether its desired amendments will all
be directed to Nestle Skin Health, Inc. or also to other defendants. (See id.) ("Truinject
anticipates the Second Amended Complaint will contain multiple new claims against
defendants.") This ambiguity is among the reasons that Truinject will be required to file a
motion for leave to amend if it wishes to expand this case (beyond correcting the deficiencies
identified in Report II).
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WHEREAS, the Court concludes that Report I and Report II should be adopted for the
reasons stated by Judge Hall;

NOW, THEREFORE, IT IS HEREBY ORDERED that, for the reasons stated below,
Truinject's Objection to Report I (D.I. 175) is OVERRULED, Report I (D.I. 169) is

ADOPTED, and Nestle Skin Health, S.A. ' s motion to dismiss for lack of personal jurisdiction
under Rule12(b)(2) (D.I. 123) is GRANTED. 2
1.

As an initial matter, the Court agrees with Nestle Skin Health S.A. that Truinject

failed to comply with the Court's Standing Order for Objections. (See Response at 1-2)
Truinject's Objection failed to include a written statement certifying compliance with the
Standing Order, and attaches five new exhibits which Truinject proceeds to rely on for new
factual arguments that were not raised before Judge Hall. (See D.I. 176)3 Truinject has filed a
letter apologizing for its non-compliance with the Standing Order. (D.I. 182) The Court agrees
that Truinject's non-compliance with the Standing Order is a sufficient basis for overruling its
Objection. See, e.g. , Rogers v. Wilmington Trust Co., 2019 WL 4596650, at *2 (D. Del. Sept.
23, 2019) (adopting Magistrate Judge' s recommendation due to objecting parties' failure to

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As Nestle Skin Health, S.A. ' s Rule 12(b)(2) motion to dismiss for lack of personal
jurisdiction is being granted, the Court need not address Nestle Skin Health, S.A. 's alternative
Rule 12(b)(6) motion to dismiss Counts I, V-VIII, XV, XVII-III, XXIV-XV (see D.I. 123).
3

Nestle Skin Health, S.A. also argues that Truinject' s Objection improperly raises a new
legal position by arguing that the Central District of California' s transfer "mooted the motion for
lack of personal jurisdiction." (Response at 2) In response, Truinject points to its briefing before
Judge Hall in which it argued the transferring court purportedly determined that Nestle Skin
Health, S.A. was subject to the 2014 and 2016 CDAs and, thus, "collateral estoppel" applies to
the instant motion for lack of personal jurisdiction. (See D.I. 182 at 1) (citing D.I. 131 at 7; D.I.
152 at 7-8) Because the Court has several other bases on which it is overruling Truinject' s
Objection and granting the motion to dismiss, this case does not require the Court to determine
whether Truinject's collateral estoppel argument before the Magistrate Judge was a sufficient
basis to allow a mootness argument before a District Judge.
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submit written statement in compliance with Standing Order, even though Court disagreed with
rationale ofrecommendation). Nevertheless, the Court will also analyze the merits of the
Objection, and there finds further reason to overrule the Objection.
2.

Having reviewed the pleadings and the arguments de nova, Truinject has failed to

persuade the Court that Judge Hall erred in making the following observation: "In general, the
Amended Complaint attempts to create the impression that Nestle Skin Health, S.A.'s role was
significant by collectively defining all of the Corporate Defendants as 'Nestle Skin Health' in the
Complaint." (Report I at 3 n.1) Further, the Court agrees that by "frequently refer[ring] to
'Defendants ' without specifying a particular Defendant," it is "extremely difficult ... to discern
from the Amended Complaint which Defendant performed the alleged acts ." (Id. ; see also id. at
4-5 n.2 (noting example from oral argument in which counsel admitted that allegation in, 103 of
Amended Complaint quoted an email as referencing "at [Nestle Skin Health]" when in fact the
email actually says " at Galderma"); D.I. 163 at 130-31) "When a defendant challenges the
court' s personal jurisdiction, the plaintiff bears the burden to come forward with sufficient facts
to establish that jurisdiction is proper." Danzinger & De Llano, LLP v. Morgan Verkamp LLC,
948 F.3d 124, 129 (3d Cir. 2020). In this case, Truinject' s group pleading has resulted in a
complaint that fails to meet its burden to allege sufficient facts to establish that this Court may
properly exercise personal jurisdiction over Nestle Skin Health, S.A. 4

4

Truinject is plainly disappointed with certain of the language the Report used to
characterize Truinject's pleading strategy. (See, e.g. , Objection at 1, 4-5, 6 & n.2 (counsel
stating that in all his years of practice he has not been accused of playing tricks or intentional
obfuscation), 10) The Court makes no finding as to Truinject' s motivation for its definition of
Defendants. However, even assuming Truinject's pleading is consistent with "the naming
convention Defendants used with Truinject," Truinject's approach resulted in a deficient
complaint.
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3.

The Court agrees with Report I that neither the 2014 nor 2016 CDAs confers

personal jurisdiction over Nestle Skin Health, S.A. through the forum selection clause. Nestle
Skin Health, S.A.'s status as an indirect corporate parent of Galderma Laboratories, L.P. , the sole
signatory to the CDAs, is insufficient to bind Nestle Skin Health, S.A. to the Delaware forum
selection clause, as a purported "affiliate," or due to receipt of a "direct benefit," or by virtue of
being "closely related" to the CDAs. (See Report I at 17-24; see also Response at 3-9) Truinject
fails to allege sufficient facts to establish that Galderma Laboratories, L.P. or its Vice President,
Quintin Cassady, had actual or apparent authority to bind Nestle Skin Health, S.A. (See id. at
17-19) Nor did Judge Hall err in her analysis and rejection ofTruinject's contentions that Nestle
Skin Health, S.A. derived some "direct benefit" from disclosures to its Chief Financial Officer or
was so "closely related" to the CDAs as to be bound by them. Truinject has not alleged the kind
of "direct benefit" that Delaware courts have found sufficient to bind a non-signatory to a forum
selection clause. See, e.g. , Baker v. Impact Holdings, Inc., 2010 WL 1931032, at *4 (Del. Ch.
Ct. May 13, 2010) (finding right to seat on board of directors constituted direct benefit); see also
Neurvana Med. , LLC v. Bait USA, LLC, 2019 WL 4464268, at *4-7 (D. Del. Sept. 18, 2019)

(co 11 ecting cases).
4.

Truinject's argument that the Central District of California necessarily already

decided Nestle Skin Health, S.A. was bound by the Delaware forum selection clause in the
CDAs in deciding to transfer the case here is also unavailing. (See Objection at 6-7) The
transferring court undertook no personal jurisdiction analysis and expressly declined to
determine whether any defendant, including Nestle Skin Health, S.A., was an "affiliate" within
the meaning of the 2014 or 2016 CDAs. (See D.I. 101 at 13 n.6) Contrary to Truinject's
contention, it is evident that Judge Hall did fairly consider the transferring judge's ruling. (See

6

Report I at 12) The Court agrees with Judge Hall ' s determination that whether Nestle Skin
Health, S.A. is subject to personal jurisdiction in Delaware was an issue "reserved for the
transferee court." (Id. at 25; see also D .I. 101 ) 5
5.

Finally, the Court agrees with Judge Hall that jurisdictional discovery is not

warranted, for the reasons she has stated. (See Report I at 25-26)

IT IS HEREBY FURTHER ORDERED that:
1.

Report II (D.I. 178) is ADOPTED.

2.

Galderma, S.A. and Galderma Laboratories L.P. ' s motion to dismiss (D.I. 117) is

GRANTED with respect to Counts II, IV, VI, VIII, XI, XXIV, DENIED with respect to Count
XXV, and DENIED with respect to Galderma, S.A. ' s request to dismiss Count V and VII
against it.
3.

Nestle Skin Health, Inc.'s motion to dismiss (D.I. 121) is GRANTED with

respect to Counts I, V, VI, VII, VIII, XXIV and DENIED with respect to Counts XVI and XXV.
4.

Defendant John Rogers ' motion to dismiss (D.I. 125) is GRANTED.

5.

Defendants Stuart Raetzman, Tiphany Lopez, Scott McCrea, and Alisa Lask' s

motion to dismiss (D.I. 119) is GRANTED.
6.

Consistent with Report II, Truinject may file an amended complaint addressing

the specific deficiencies identified by Judge Hall in Report II. Any such amended complaint
must be filed no later than April 6 and shall not contain any new causes of action. If Truinject

5

The transferring judge noted that some of the pending motions might be "mooted by
transfer" (D.I. 101 at 1) but did not decide which, if any, were mooted. Judge Hall correctly
concluded that Nestle Skin Health, S .A. ' s motion to dismiss was not moot.
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wishes to expand this case beyond addressing the specific deficiencies noted in Report II, it must
seek leave to amend and obtain Defendants' consent and/or be granted leave by the Court.

HONORAB E LEONARD P. ST
UNITED STA TES DISTRICT TTJDGE

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