Facts

Youngevity International is a Delaware network marketing company with its principal place of business in Chula Vista, California. Its core business model is to develop and sell dietary supplement products through independent, direct-sellers.

Innov8tive Nutrition, LaCore Nutraceuticals, LaCore Enterprises, and LaCore Labs, businesses based in Texas, all package, manufacture and distribute particular patch products marketed by Innov8tive. The patches, when placed on the skin, were purported to provide vitamins, minerals, or nutrients that would be absorbed transdermally.

On May 19, 2022, Youngevity brought suit against Innov8tive Nutrition and the LaCore entities asserting several claims under the Lanham Act, and also for misleading or false advertisement. In response, Innov8tive and the entities filed a motion to dismiss for lack of personal jurisdiction.

PLAINTIFF'S CONTENTIONS: As for the core of its claim, plaintiff alleged two misrepresentations: that not only were Innov8tive's claims regarding the patch's ability to transdermally provide the nutrients false, but so to were its product labels, as far as the amount of nutrients stated. Because of this false information, plaintiff contended that it lost distributors and customers to Innov8tive, who also sold its own products through independent distributors. By paying a membership fee and entering an agreement, "promoters" of Innov8tive products may then market or sell the patch products in California. As to the jurisdiction claim, plaintiff asserted that as a subsidiary of LaCore Enterprises, Innov8tive's contacts could be imputed to LaCore.

DEFENDANTS' CONTENTIONS: Defendants denied all contentions, contending that plaintiff could not establish that it purposefully directed or expressly aimed its activities or conduct in California, which meant that the court did not have personal jurisdiction over the defendants.

Result

The court agreed with defendants, granting the motion to dismiss and closing the case.