throbber
Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 1 of 12 PageID #: 1
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
`
`
`
`
`
`
`
`
`
`DEMAND FOR JURY TRIAL
`
`C.A. No. _________________
`
`
`
`KANEKA CORPORATION,
`A Japanese Corporation.
`
` Plaintiff,
`
` v.
`
`DESIGNS FOR HEALTH, INC.,
`A Delaware Corporation, and AMERICAN
`RIVER NUTRITION LLC, A Delaware
`Corporation
`
` Defendants.
`
`
`
`COMPLAINT
`
`Plaintiff Kaneka Corporation (“Kaneka”) files this Complaint for Patent Infringement and
`
`Demand for Jury Trial against Designs For Health Inc. (“DFH”) and American River Nutrition
`
`LLC (“ARN”).
`
`NATURE OF THE ACTION
`
`1.
`
`This is an action for Patent infringement under the laws of the United States, Title
`
`35, United States Code by Kaneka against DFH and ARN.
`
`2.
`
`This action arises from DFH’s manufacture, use, offer for sale, and sale in the
`
`United States of the supplements, DuoQuinol and CoQnol (“Accused Products”) which, upon
`
`information and belief, were designed and developed by ARN, and manufactured, offered for sale
`
`and sold by DFH under the trademarks “DuoQuinol” and/or “CoQnol” These activities infringe,
`
`either literally or under the doctrine of equivalents, and induce others to infringe two Patents
`
`owned by Kaneka.
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 2 of 12 PageID #: 2
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`THE PARTIES
`
`3.
`
`Kaneka is a Japanese Corporation with a head office at 1-12-32, Akasaka, Minato-
`
`Ku, Tokyo, Japan, and a head office at 2-3-18, Nakanoshima, Kita-Ku, Osaka, Japan.
`
`4.
`
`DFH is a Delaware Corporation at 14 Commerce Blvd., Palm Coast, FL 32164.
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`DFH may be served with process through its registered agent, Northwest Registered Agent
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`Service Inc., 8 The Green, Ste. B, Dover, Delaware 19901.
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`5.
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`ARN is a Delaware Corporation at 333 Venture Way, Hadley, MA 01035. ARN
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`may be served through its registered agent, Northwest Registered Agent Service Inc., 8 The
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`Green, Ste. B, Dover, Delaware, 19901.
`
`JURISDICTION AND VENUE
`
`6.
`
`7.
`
`This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§1331 and 1338(a).
`
`Based on the facts and causes alleged herein, and for additional reasons to be further
`
`developed through discovery, this Court has personal jurisdiction over the Defendants.
`
`8.
`
`This Court has personal jurisdiction over DFH and ARN as both are Delaware
`
`Corporations.
`
`9.
`
`This Court additionally has personal jurisdiction over the Defendants because upon
`
`information and belief, the Defendants have knowingly directly infringed, and induced
`
`infringement within this District by advertising, marketing and offering for sale the Accused
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`Products within this District, to consumers, customers, distributers, resellers, partners and/or end
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`users, and providing instructions, advertising, and/or marketing materials that facilitate, direct or
`
`encourage the use of the Accused Products.
`
`10. Venue is proper in this District pursuant to 28 U.S.C. §§ 1391 and 1400(b).
`
`
`
`-2-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 3 of 12 PageID #: 3
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`Kaneka’s Innovations
`
`BACKGROUND
`
`11.
`
` Kaneka Corporation is an international company that produces a number of
`
`different products at plants around the world. It has also been the world’s premier supplier of
`
`Coenzyme Q10 (“CoQ10”) supplements for more than 40 years. CoQ10 is found in every cell of
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`the human body. The human body makes CoQ10 and the cells use it to produce energy that the
`
`human body needs for cell growth and cell maintenance. It also protects the body from damage
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`caused by harmful molecules. CoQ10 levels in the body decrease with age, which explains why
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`millions of people take Kaneka CoQ10 on a daily basis. Kaneka sells CoQ10 as a nutritional
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`supplement, similar to vitamins.
`
`12. There are two types of CoQ10. The oxidized form is known as Ubiquinone, and the
`
`reduced form is known as Ubiquinol. Kaneka was the first industrial scale manufacturer of
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`Ubiquinone, starting in 1977. When exposed to air, reduced CoQ10 (Ubiquinol) quickly
`
`undergoes a chemical reaction—oxidation—and converts to oxidized CoQ10 (Ubiquinone).
`
`Kaneka was the first manufacturer in the world to succeed in the development of technology to
`
`stabilize Ubiquinol so that it did not quickly oxidize when exposed to air. Kaneka began sales of
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`Ubiquinol in the U.S. in 2006. Kaneka has been awarded a number of patents covering its
`
`Ubiquinol products and due to that patent protection Kaneka is the only company that has the
`
`legal right to produce and sell Ubiquinol in the United States. DFH admits that the Accused
`
`Products are a form of Ubiquinol. (See Exhibit C)
`
`13. During its 40 year history of producing CoQ10 products, Kaneka has supported
`
`hundreds of CoQ10 clinical research studies at universities and hospitals around the globe.
`
`Kaneka has focused its research support by working with top, independent academic research
`
`
`
`-3-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 4 of 12 PageID #: 4
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`institutions conducting research into the functionality and health benefits of all forms of CoQ10 to
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`ensure that the CoQ10 products made by Kaneka are safe and effective. All CoQ10 products made
`
`by Kaneka have satisfied all applicable FDA standards and other government agency
`
`requirements for safety and efficacy. Kaneka has ensured the safety and efficacy of its CoQ10
`
`products for the entire 40 year history of producing these products.
`
`14. Over this 40 year period, Kaneka has been granted over 37 U.S. Patents covering
`
`the production of CoQ10 products, and numerous CoQ10 related Patents issued in other countries
`
`around the world.
`
`The Asserted Patents
`
`15. United States Patent No. 7,145,044 (the “’044 Patent”) titled “Method Of
`
`Producing Reduced Coenzyme Q10 Using Solvent with High Oxidation-Protective Effect” was
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`duly issued on December 5, 2006, and remains unexpired. A true and correct copy of the ’044
`
`Patent is attached as Exhibit A and is assigned to and owned by Kaneka Corporation.
`
`16. United States Patent No. 7,829,080 (the “’080 Patent”) titled “Stabilization Method
`
`Of Reduced Coenzyme Q10” was duly issued on November 9, 2010, and remains unexpired. A
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`true and correct copy of the ’080 Patent is attached hereto as Exhibit B and is assigned to and
`
`owned by Kaneka Corporation.
`
`The DFH Infringing Product and Activities
`
`17. The Accused Products are DuoQuinol and CoQnol. DFH admits that DuoQuinol
`
`is a form of Ubiquinol, derived from Ubiquinone through a process involving the use of
`
`geranygeraniol (GG) and ascorbyl palmitate. (See Exhibit C.) Upon information and belief, the
`
`DuoQuinol product was designed and developed by Dr. Barrie Tan, the founder of ARN. ARN
`
`then provided DFH the information required to produce DuoQuinol on a commercial scale, and
`
`
`
`-4-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 5 of 12 PageID #: 5
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`the production was done by Ashley-Martin Manufacturing, the DFH manufacturing unit.1 DFH
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`markets, advertises, offers for sale, and sells the Accused Products under the name CoQnol.
`
`18. Defendant ARN has induced the direct infringement of DFH by designing and
`
`developing the DuoQuinol product and providing DFH with the information required to produce
`
`DuoQuinol on a commercial scale. Upon information and belief, Ashley-Martin Manufacturing,
`
`the DFH manufacturing unit, does not have the experience to design and develop a new type of
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`Ubiquinol like the DuoQuinol product. A review of the employees at Ashley-Martin
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`Manufacturing on Linked In shows a number of employees with manufacturing and production
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`experience, but none with a research background. In contrast, Dr. Tan has a PhD in
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`Chemistry/Biochemistry, and the ARN website states that Dr. Tan’s mission “is to deliver the
`
`highest quality nutritional products based on sound scientific research.” Dr. Tan is also very
`
`familiar with Kaneka Corporation. In the 2015-2016 time period, Kaneka Corporation entered
`
`into business discussions with ARN. During those discussions Dr. Tan acknowledged that he
`
`knew Kaneka very well and followed the company closely. Dr. Tan also acknowledged that he
`
`had followed the science and chemistry of CoQ10 all of his life. ARN is also very familiar with
`
`the world of patents and patent litigation, as ARN has over 13 issued patents and pending patent
`
`applications, and ARN is currently the plaintiff in a patent infringement case in the Central
`
`District of California. Accordingly, upon information and belief, ARN had the expertise to
`
`design and develop a new form of Ubiquinol, and to provide that information to DFH. As Dr.
`
`
`1 Upon information and belief, the manufacturing unit of DFH goes by the name of Ashley-Martin
`Manufacturing. Ashley-Martin Manufacturing LLC was initially formed in Delaware on
`November 6, 2006. On March 31, 2015, Ashley-Martin Manufacturing LLC merged with DFH,
`with DFH continuing as the surviving company.
`
`
`-5-
`
`
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 6 of 12 PageID #: 6
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`Tan followed the science and chemistry of CoQ10 all of his life ARN also had to know that
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`Kaneka Corporation was the only company producing Ubiquinol. Also based on ARN’s
`
`experience with patents and patent litigation, ARN had to know that Kaneka had a number of
`
`patents covering Ubiquinol. Therefore, when ARN provided information to DFH on how to
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`produce DuoQuinol, it intentionally aided and encouraged DFH to directly infringe Kaneka
`
`Corporation’s Ubiquinol patents, and thereby induced the direct infringement of DFH.
`
`Alternatively, if ARN did not take steps to investigate the patents held by Kaneka covering
`
`Ubiquinol products, it was unquestionably willfully blind in failing to conduct that investigation.
`
`19. The Defendants have either induced infringement or infringed directly one or more
`
`claims of the Asserted Patents and continue to infringe (literally and under the doctrine of
`
`equivalents), directly, indirectly, and/or through agents or intermediaries by making, using,
`
`offering for sale and/or selling the Accused Product in the United States.
`
`20. The DFH customers (including distributors and retailers) have infringed and/or
`
`continue to infringe (literally and under the doctrine of equivalents) directly, indirectly, and/or
`
`through agents or intermediaries, one or more claims of the Asserted Patents by using, offering
`
`for sale, and/or selling the Accused Product in the United States.
`
`21. The DFH infringement has caused, is causing, and will continue to cause Kaneka
`
`to suffer damage, and Kaneka is entitled to recover damages in an amount proven at trial, but no
`
`less than a reasonable royalty as provided by 35 U.S.C. § 284.
`
`
`
`-6-
`
`
`
`
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 7 of 12 PageID #: 7
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`COUNT I
`(Direct Infringement of the ’044 Patent by DFH)
`
`
`
`22. Kaneka incorporates each of the preceding paragraphs as if fully set forth herein.
`
`23. DFH has been and is now directly infringing claims 1 and 13 of the ’044 Patent,
`
`either literally or under the doctrine of equivalents, in violation of 35 U.S.C. § 271(a) by making,
`
`using, offering for sale, and/or selling in the United States the Accused Products that infringe the
`
`claims of the ’044 Patent.
`
`24. By way of example, claim 13 of the ’044 Patent reads as follows:
`
`“13). A reduced coenzyme Q10 crystal with a reduced coenzyme Q10 /oxidized
`
`coenzyme Q10 weight ratio of not lower 96/4”.
`
`25. Exhibit D shows the tests done by Kaneka on the reduced Q10 ratio in the CoQnol
`
`capsules produced and sold by DFH. Exhibit D includes three separate reports labeled Analysis
`
`Report 1, Analysis Report 2 and Analysis Report 3. Table 1 in Report 1 shows that the reduced
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`Q10 ratio was 99.7, more than the claimed requirement of not lower than 96/4. Reports 2 and 3
`
`show that the reduced Q10 found in the CoQnol capsule is crystalized. DFH thereby directly
`
`infringes claim 13 of the ’044 Patent.
`
`26. DFH’s direct infringement of Claims 1 and 13 of the ’044 Patent is further detailed
`
`in the claim charts attached as Exhibit E.
`
`27. DFH has been, and is now, indirectly infringing the ’044 Patent in violation of 35
`
`U.S.C. § 271(b) by actively inducing the direct infringement of the ’044 Patent by their
`
`distributors, retailers and customers, including at least by making, using, offering for sale and/or
`
`selling the Accused Products in the United States.
`
`
`
`-7-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 8 of 12 PageID #: 8
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`28. As a consequence of DFH’s infringement of the ‘044 Patent, Kaneka has suffered,
`
`is suffering, and will continue to suffer, damages in an amount not yet determined, but no less than
`
`a reasonable royalty.
`
`
`
` COUNT II
` (Direct Infringement of the ’080 Patent by DFH)
`
`29. Kaneka incorporates each of the preceding paragraphs as if fully set forth herein.
`
`30. DFH has been, and is now, directly infringing claims 1, 5 and 15 of the ’080 Patent,
`
`either literally or under the doctrine of equivalents, in violation of 35 U.S.C. § 271(a) by making,
`
`using, offering for sale, and/or selling in the United States the Accused Products that infringe the
`
`claims of the ’080 Patent.
`
`31. By way of example, claim 5 of the ’080 Patent reads or follows;
`
`“5) A reduced coenzyme Q10-containing composition, comprising reduced
`
`coenzyme Q10 and one or both of (a) and (b): (a) not less than 1.5 wt % to not more
`
`than 99 wt % of reduced coenzyme Q9 relative to reduced coenzyme Q10, and (b)
`
`reduced coenzyme Q11, wherein not less than 0.01 wt % of reduced coenzyme Q10
`
`is contained in the composition, and wherein the proportion of reduced coenzyme
`
`Q10 relative to the total amount of coenzyme Q10 is not less than 90 wt %.”
`
`32. DFH produces and sells DuoQuinol/CoQnol which is reduced coenzyme Q10.
`
`Exhibit D, Report 1, are Kaneka’s test results on CoQnol capsules produced and sold by DFH.
`
`The tests show in Table 1 that the proportion of reduced coenzyme Q10, relative to the total amount
`
`of coenzyme Q10 was 99.7% and Table 2 shows that 88ug of Q11 was present in the CoQnol
`
`capsule. Accordingly, DFH directly infringes claim 5 of the ’080 Patent. For the same reasons,
`
`DFH also directly infringes at least claims 1 and 15 of the ’080 Patent.
`
`
`
`-8-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 9 of 12 PageID #: 9
`
`33.
`
`DFH’s infringement of Claims 1, 5, and 15 of the ’080 Patent is further detailed in
`
`Exhibit E.
`
`34.
`
`DFH has been, and is now, indirectly infringing the ’080 Patent in violation of
`
`§ 271(b) by actively inducing the direct infringement of the ’080 Patent by their distributors,
`
`retailers and customers, including at least by making, using, offering for sale, and/or selling the
`
`Accused Products.
`
`35.
`
`As a consequence of DFH’s infringement of the ’044 Patent, Kaneka has suffered,
`
`is suffering, and will continue to suffer, damages in an amount not yet determined, but no less than
`
`a reasonable royalty
`
`COUNT III
`(Induced Infringement by ARN of the ’046 and ’080 Patents)
`
`36. Kaneka incorporates each of the proceeding paragraphs as if fully set forth herein.
`
`37. Upon information and belief, ARN has been, and currently is, inducing
`
`infringement of the ’044 and ’080 Patents in violation of 35 USC § 271(b) by knowingly
`
`encouraging and aiding DFH to make, use, sell or offer to sell the Accused Products in the United
`
`States which directly infringes the ’044 and ’080 Patents.
`
`38. The Supreme Court in Global-Tech Appliances Inc. v SEB S.A., 563 U.S. 754
`
`(2011) held that induced infringement under 271(b) requires knowledge that the induced acts
`
`constitute patent infringement, but also held that the required knowledge could be shown under
`
`the doctrine of “willful blindness.” The Supreme Court found two basic requirements to show
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`“willful blindness:” (1) the defendant must subjectively believe that there is a high probability
`
`that a fact exists and (2) the defendant must take deliberate actions to avoid learning of that fact.
`
`The Supreme Court specifically said that “[u]nder this formulation a willfully blind defendant is
`
`-9-
`
`
`
`
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 10 of 12 PageID #: 10
`
`one who takes deliberate actions to avoid conforming a high probability of wrongdoing and can
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`almost be said to have actually known the critical facts.” The critical fact here is whether Dr. Tan
`
`believed there was a high probability that Kaneka had patents covering the production of
`
`Ubiquinol.
`
`39. As set forth above, during the 2015-2016 business discussions Dr. Tan revealed
`
`that he was well aware of Kaneka and Kaneka’s products, including Ubiquinol and we quote; “I
`
`know of Kaneka, I know them very well and I follow the company closely.” “They provide high
`
`quality ingredients and they are a market leader.” “I am intrigued by Kaneka, I have been
`
`following the science and chemistry of CoQ10 all of my life and it is a passion of mine.” “I told
`
`Mr. (Kaneka employee name deleted) about my interests in CoQ10 and how I see CoQ10 and QH
`
`as good complementary products for (product name deleted).” To be clear QH is another name
`
`for Ubiquinol. Obviously Dr. Tan was very familiar with Kaneka, Kaneka’s CoQ10 products,
`
`including Ubiquinol, and certainly had to know that Kaneka was the only company with the right
`
`to sell Ubiquinol in the United States due to Kaneka’s patents covering Ubiquinol. Dr. Tan was
`
`also well aware of the value of patent protection as ARN is currently asserting an ARN patent in
`
`the Central District of California and ARN has been granted a number of U.S. patents. With this
`
`knowledge, ARN proceeded to aide and encourage DFH to produce the Ubiquinol Accused
`
`Products in the United States in a manner that ARN knew, or should have known, but for willful
`
`blindness, that the Ubiquinol Accused Products would infringe, or have a high probability of
`
`infringing one or more of Kaneka’s patents, which cover the production of Ubiquinol. Kaneka
`
`therefore alleges that ARN has been, and currently is, inducing the direct infringement of the ’044
`
`and ’080 Patents by DFH.
`
`
`
`-10-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 11 of 12 PageID #: 11
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`40. As a consequence of ARN inducing infringement of the ’044 and ’080 Patents,
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`Kaneka has suffered, is suffering, and will continue to suffer, damages in an amount not yet
`
`determined, but no less than a reasonable royalty
`
`PRAYER FOR RELIEF
`
`WHEREFORE, Kaneka requests the following relief:
`
`a)
`
`b)
`
`A judgment that DFH has directly infringed the ’044 and ’080 Patents;
`
`A judgment that ARN has induced direct infringement of the ’044 and ’080
`
`Patents;
`
`c)
`
`Damages adequate to compensate for Defendants infringement but, in no
`
`d)
`
`e)
`
`event, less than a reasonable royalty on past and future infringing sales;
`
`An award of Kaneka’s costs and expenses in this action,
`
`Entry of a preliminary and permanent injunction, pursuant to 35 U.S.C.
`
`§ 283 enjoining each of the Defendants, and all of their respective agents,
`
`servants, officers, directors, employees, and all other persons acting in
`
`concert with them, directly or indirectly, from any further acts of
`
`infringement.
`
`Such further and other relief as this Court may deem just and
`
`DEMAND FOR A JURY TRIAL
`
`Pursuant to Rule 38 of the Federal Rules of Civil Procedure, Kaneka demands a trial by
`
`jury on all issues triable as of right by a jury proper.
`
`
`
`-11-
`
`

`

`Case 1:21-cv-00209-UNA Document 1 Filed 02/16/21 Page 12 of 12 PageID #: 12
`
`BAYARD, P.A.
`
`/s/ Stephen B. Brauerman
`Stephen B. Brauerman (#4952)
`Ronald P. Golden III (#6254)
`600 N. King Street, Suite 400
`Wilmington, DE 19899
`Tel: (302) 655-5000
`sbrauerman@bayardlaw.com
`rgolden@bayardlaw.com
`
`By:
`
`
`
`
`
`
`
`
`Date: February 16, 2021
`
`
`
`
`
`
`
`
`
`
`
`
`OF COUNSEL
`Keith D. Nowak
`William F. Sondericker
`Gerald W. Griffin
`CARTER LEDYARD & MILBURN, LLP
`Two Wall Street
`New York, New York 10005
`212-238-8610
`
`
`
`-12-
`
`

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