Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_10-cv-02580/USCOURTS-casd-3_10-cv-02580-0/pdf.json

Nature of Suit Code: 365
Nature of Suit: Personal Injury - Product Liability
Cause of Action: 28:1332 Diversity-Product Liability

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1 09md2087 BTM(CAB); 10cv2580 BTM(CAB) 

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

IN RE HYDROXYCUT MARKETING

AND SALES PRACTICES LITIGATION

Case No. 09md2087 BTM(CAB)

VELMA J. CARTER, an individual;

SUREE WANDA BRYSON, an individual;

RAYMOND C. LEE, and individual;

Plaintiffs,

Case No. 10cv2580 BTM(CAB)

ORDER GRANTING MOTION TO

DISMISS FOR LACK OF

JURISDICTION AS TO IOVATE

COPYRIGHT LTD.; DENYING

MOTION TO DISMISS; AND

DENYING AS MOOT MOTION TO

AMEND COMPLAINT

v.

MUSCLETECH RESEARCH AND

DEVELOPMENT, INC., et al.,

Defendants.

Defendant Iovate Copyright Ltd. (“Copyright”) has filed a motion to dismiss for lack of

personal jurisdiction. The other defendants (“Defendants”) have filed a motion to dismiss

Plaintiffs’ Complaint for failure to state a claim. Plaintiffs have filed a motion to file an

amended complaint that adds factual allegations in support of their fraud claims. For the

reasons discussed below, Copyright’s motion to dismiss is GRANTED, Defendants’ motion

to dismiss is DENIED, and Plaintiffs’ motion for leave to amend is DENIED AS MOOT.

I. BACKGROUND

On September 30, 2010, Plaintiffs filed their complaint in the Northern District of

Alabama (Alabama Civil Case No. 10-cv-2655-AKK). On December 15, 2010, the case was

transferred to the Southern District of California as a tag-along action to the In re Hydroxycut

Marketing and Sales Practices multi-district litigation currently pending before the Court.

Case 3:10-cv-02580-BTM-KSC Document 25 Filed 05/24/11 Page 1 of 5
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2 09md2087 BTM(CAB); 10cv2580 BTM(CAB) 

Upon transfer, the case was assigned a separate civil case number in the Southern District

of California (Case No. 10cv2580 BTM(CAB)). 

Plaintiff Velma J. Carter is a resident of Mississippi. Plaintiff Suree Wanda Vryson is

a resident of South Carolina. Plaintiff Raymond C. Lee is a resident of Washington, D.C.

According to the Complaint, Plaintiffs purchased “Hydroxycut products” at Wal-mart and

suffered physical injury as a result of the consumption of such products.

Plaintiffs assert the following claims against the defendants: (1)

negligence/wantonness; (2) product liability; (3) intentional misrepresentation; (4) negligent

misrepresentation; (5) breach of express warranty; (6) breach of implied warranty of

merchantability; (7) breach of implied warranty of fitness for particular purpose; (8) unjust

enrichment; and (9) fraud and misrepresentation.

After Defendants filed their motions to dismiss, Plaintiffs filed a First Amended

Complaint (mislabeled “Second Amended Complaint”) pursuant to a stipulation of the parties.

The First Amended Complaint (“FAC”) adds new defendants as well as more factual

allegations in support of Plaintiffs’ fraud claim. The Court construes the motion to dismiss

for failure to state a claim to apply to the FAC.

II. DISCUSSION

A. Copyright’s Motion

Copyright has filed a motion to dismiss for lack of personal jurisdiction. Because this

case was originally filed in the Northern District of Alabama, this Court can exercise personal

jurisdiction over Copyright only to the extent that the Northern District of Alabama could have.

In re Dynamic Random Access Memory, 2005 WL 2988715, at * 2 (N.D. Cal. Nov. 7, 2005).

Copyright contends that Plaintiffs have not made out a prima facie case of either

general or specific jurisdiction, as needed to satisfy federal due process. See Helicopteros

Nacionales de Colombia S.A. v. Hall, 466 U.S. 408, 414 (1984). According to the declaration

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3 09md2087 BTM(CAB); 10cv2580 BTM(CAB) 

of Jo-Ann Heikkila, Copyright is a Canadian corporation which has never been licensed to

do business in the United States, has never maintained an office or bank account in the

United States, has never maintained a website accessible by United States citizens, and has

not had any involvement in the manufacture, sale, or advertisement of Hydroxycut-branded

products.

Plaintiffs did not file an opposition to Copyright’s motion. Plaintiffs’ Complaint itself

merely states that “[a]t all times relevant hereto, Iovate Copyright, Ltd. was and is doing

business within this judicial district.” (Compl. ¶ 10.) The Complaint does not set forth any

factual allegations supporting this conclusory statement.

When a defendant brings a motion to dismiss for lack of personal jurisdiction, the

plaintiff bears the burden of establishing that jurisdiction is proper. Sher v. Johnson, 911

F.2d 1357, 1361 (9th Cir. 1990). If the district court decides the motion without holding an

evidentiary hearing, “the plaintiff need only make a prima facie showing of the jurisdictional

facts.” Id. 

Plaintiffs have not alleged any facts tending to show that the Northern District of

Alabama has general or specific jurisdiction over Copyright. Therefore, Plaintiffs have failed

to make out a prima facie showing of personal jurisdiction, and the Court GRANTS

Copyright’s motion to dismiss for lack of personal jurisdiction. 

B. Defendants’ 12(b)(6) Motion to Dismiss & Plaintiffs’ Motion for Leave to Amend 

1. Fraud Claims

Defendants contend that Plaintiffs’ fraud-based claims (intentional misrepresentation,

negligent misrepresentation, and fraud and misrepresentation) fail because Plaintiffs have

failed to satisfy the pleading requirements of Fed. R. Civ. P. 9(b). 

Originally, Plaintiffs failed to identify what Hydroxycut product they took, when the

product was consumed, what fraudulent statements or materials they relied on, how or where

the misrepresentations were made, and when the fraudulent misrepresentations occurred.

Case 3:10-cv-02580-BTM-KSC Document 25 Filed 05/24/11 Page 3 of 5
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4 09md2087 BTM(CAB); 10cv2580 BTM(CAB) 

 In the FAC, Plaintiffs have added factual allegations remedying these defects. (FAC ¶ 52.)

The Court is satisfied that Plaintiffs have pled fraud with sufficient specificity.

Defendants argue that Plaintiff Lee’s claim for “negligent misrepresentation” must be

dismissed because Virginia law does not recognize a cause of action for “negligent

misrepresentation.” Under Virginia law, the proper name for such a claim is “constructive

fraud.” See Hansen v. Stanley Martin Companies, Inc., 585 S.E.2d 567, 573 n. 4 (Va. 2003)

(“Negligent misrepresentation is the essence of a claim for constructive fraud in Virginia.”);

Goff v. J. Sargeant Reynolds Comm. College, 2004 WL 2093444, at * 2 (Va. Cir. Ct. Sept.

20, 2004) (explaining that plaintiff asserting counts for intentional misrepresentation and

negligent misrepresentation really alleged “actual and constructive fraud.”) However, the

Court will not dismiss Plaintiff Lee’s claim merely because it is mislabeled “negligent

misrepresentation.”

2. Breach of Warranty Claims 

Defendants argue that Plaintiffs’ breach of warranty claims fail to state a claim

because Plaintiffs did not plead that they gave Defendants notice of the breach before filing

suit. 

Under the U.C.C., where a tender of goods has been accepted, “the buyer must within

a reasonable time after he discovers or should have discovered any breach notify the seller

of breach or be barred from any remedy . . . .” U.C.C. § 2-607(3)(a). It appears that the

weight of authority holds that the U.C.C.’s notice requirements do not rigidly apply to

consumer buyers who suffered personal injuries as a result of the breach of warranty. See,

e.g., Connick v. Suzuki Motor Co., Ltd., 675 N.E. 2d 584, 590 (Ill. 1996); Smith v. Stewart,

667 P. 2d 358, 365 (Kan. 1983); Maybank v. S.S. Kresge Co., 273 S.E.2d 681, 684-85 (N.C.

1981). 

Plaintiffs point out that South Carolina’s version of U.C.C. § 2-607(3)(a) specifically

states “no notice of injury to the person in the case of consumer good shall be required.”

S.C. Code § 36-2-607(3)(a). As for Virginia law and Mississippi law, the cases cited by

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5 09md2087 BTM(CAB); 10cv2580 BTM(CAB) 

Defendants do not hold that consumers who suffer personal injury must give notice before

filing a claim for breach of warranty. Accordingly, the Court denies Defendants’ motion to

dismiss the breach of warranty claims for failure to give notice.

3. Unjust Enrichment 

Defendants move to dismiss Plaintiff Velma Carter’s unjust enrichment claim on the

ground that unjust enrichment is not an independent theory of recovery under Mississippi

law. Although Carter may not be able to bring a free-standing claim of unjust enrichment,

such a claim is not necessarily improper if it is accompanied by predicate claims upon which

relief could be granted. See Cole v. Chevron USA, Inc., 554 F. Supp. 2d 655, 673 (S.D.

Miss. 2007) (explaining that “a claim for unjust enrichment depends upon a showing of some

legally cognizable wrong by which a defendant has been unjustly enriched at the expense

of the plaintiff.”). It makes little difference whether the claim for the remedy of unjust

enrichment is asserted in a separate count or in a prayer for relief.

III. CONCLUSION 

For the reasons discussed above Iovate Copyright Ltd.’s motion to dismiss for lack

of personal jurisdiction [09md2087 - Doc. No. 444 ; 10cv2580 - Doc. No. 11] is GRANTED.

Plaintiffs’ claims against Iovate Copyright Ltd. are DISMISSED due to the lack of personal

jurisdiction. Defendants’ motion to dismiss [09md2087 - Doc. No. 445; 10cv2580 - Doc. No.

12] is DENIED. Plaintiffs’ motion for leave to file an amended complaint [09md2087 - Doc.

No. 491; 10cv2580 - Doc. No. 14] is DENIED AS MOOT. Defendants shall file an answer

to the FAC within 20 days of the entry of this Order.

IT IS SO ORDERED.

DATED: May 24, 2011

Honorable Barry Ted Moskowitz

United States District Judge

Case 3:10-cv-02580-BTM-KSC Document 25 Filed 05/24/11 Page 5 of 5