Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 1 of 17 PageID #:1
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
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`ALICIA DIAGNOSTICS, INC.,
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`Plaintiff,
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`v.
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`MEDLINE INDUSTRIES, INC.,
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`Defendant.
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`Case No.
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`COMPLAINT
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`
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`Plaintiff, ALICIA DIAGNOSTICS, INC. (“Alicia Diagnostics” or “Plaintiff”), by and
`
`through
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`its undersigned counsel, files
`
`this Complaint against Defendant, MEDLINE
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`INDUSTRIES, INC. (“Medline” or “Defendant”), and states as follows:
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`PARTIES, VENUE, & JURISDICTION
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`1.
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`This is an action for damages. This Court has federal diversity jurisdiction pursuant
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`to 28 U.S.C. §1332, in that Plaintiff and Defendant are of diverse citizenship, and the amount in
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`controversy, exclusive of interest and costs, is in excess of $75,000.00.
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`2.
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`Alicia Diagnostics is a corporation which distributes medical equipment worldwide
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`and is organized under the laws of the State of Florida, with its principal place of business in
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`Chuluota, Florida.
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`3.
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`Medline is a corporation which manufactures certain medical products and
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`equipment and is organized under the laws of the State of Illinois, with its principal place of
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`business in Illinois.
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`4.
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`Venue is proper in this Court because the contract governing the relationship
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`between the parties provides for exclusive jurisdiction and venue in Northern District of Illinois,
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`
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`
`ALICIA DIAGNOSTICS, INC.,
`
`
`
`
`
`
`Plaintiff,
`
`
`
`
`
`
`
`v.
`
`
`
`
`
`
`
`
`
`MEDLINE INDUSTRIES, INC.,
`
`
`
`
`
`
`Defendant.
`
`
`
`
`
`
`
`
`
`
`
`Case No.
`
`
`
`
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`
`
`
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`
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`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`COMPLAINT
`
`
`
`
`Plaintiff, ALICIA DIAGNOSTICS, INC. (“Alicia Diagnostics” or “Plaintiff”), by and
`
`through
`
`its undersigned counsel, files
`
`this Complaint against Defendant, MEDLINE
`
`INDUSTRIES, INC. (“Medline” or “Defendant”), and states as follows:
`
`PARTIES, VENUE, & JURISDICTION
`
`1.
`
`This is an action for damages. This Court has federal diversity jurisdiction pursuant
`
`to 28 U.S.C. §1332, in that Plaintiff and Defendant are of diverse citizenship, and the amount in
`
`controversy, exclusive of interest and costs, is in excess of $75,000.00.
`
`2.
`
`Alicia Diagnostics is a corporation which distributes medical equipment worldwide
`
`and is organized under the laws of the State of Florida, with its principal place of business in
`
`Chuluota, Florida.
`
`3.
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`Medline is a corporation which manufactures certain medical products and
`
`equipment and is organized under the laws of the State of Illinois, with its principal place of
`
`business in Illinois.
`
`4.
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`Venue is proper in this Court because the contract governing the relationship
`
`between the parties provides for exclusive jurisdiction and venue in Northern District of Illinois,
`
`
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`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 2 of 17 PageID #:2
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`Eastern Division, and provides that both parties submit to the personal jurisdiction of this Court.
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`FACTUAL BACKGROUND
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`5.
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`Alicia Diagnostics is a distributor of medical equipment and supplies that connects
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`various territories throughout the world with medical supplies at wholesale volumes.
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`6.
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`Medline is a manufacturer and distributor of healthcare and medical equipment that
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`acts as a supply vendor for various distributors.
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`7.
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`Beginning in 2013, Alicia Diagnostics set out to export certain medical supplies to
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`the country of Iran.
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`8.
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`To that end, Alicia Diagnostics secured a license through the U.S. Department of
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`the Treasury Office of Foreign Assets Control to export certain food items, medicine, and basic
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`medical supplies to Iran.
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`9.
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`In August 2016, Medline and Alicia Diagnostics entered into a Distribution
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`Agreement wherein Medline appointed Alicia Diagnostics as its exclusive distributor of certain
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`Advanced Wound Care products in Iran up and until August 25, 2021 (the “Distribution
`
`Agreement”). A true and correct copy of the Distribution Agreement is attached hereto as Exhibit
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`“A.”
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`
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`10.
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`The terms of the Distribution Agreement included the following, among others:
`
`a.
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`Through the course of the Distribution Agreement, Alicia Diagnostics must
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`purchase and pay for the following United States dollar volumes of Medline
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`products:
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`i. Year 1: $1,000,000
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`ii. Year 2: $1,500,000
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`iii. Year 3: $500,000 growth or 20% growth over prior year, whichever is
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`2
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`greater
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`iv. Year 4: $500,000 growth or 20% growth over prior year, whichever is
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`greater
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`v. Year 5: $500,000 growth or 20% growth over prior year, whichever is
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`greater
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`11.
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`Through 2016 and 2017, Alicia Diagnostics successfully registered approximately
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`80 Medline products with the Iranian Ministry of Health (“MOH”) to meet the Iranian Transactions
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`and Sanctions Regulations.
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`12.
`
` MOH is a government organization regulating the import and sale of medical
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`equipment and supplies in a particular territory.
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`13.
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`In working with the MOH, Alicia Diagnostics would register the potential products
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`and submit all quality, testing, and pricing documentation of products for MOH approval.
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`14.
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`Alicia Diagnostics has expended a total of approximately $121,000 on the
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`registration of the Medline products through MOH and other necessary organizations, and on
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`securing the required permits, registrations, and licenses to export and distribute Medline products
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`in Iran.
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`15.
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`Once the MOH registration process was complete, Alicia Diagnostics would then
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`submit a proforma invoice for each delivery to MOH to apply for the import license.
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`16.
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`Under the applicable Iranian regulations, to secure its performance, Alicia
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`Diagnostics was required to post cash collateral in an amount equal to two times the total cost of
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`the order, half of which was deposited into and held in an Iranian escrow account, and the other
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`half was deposited with and held by MOH.
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`17.
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`On top of those deposits, Medline also required a deposit from Alicia Diagnostics
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`3
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`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 4 of 17 PageID #:4
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`to secure payment for the ordered products, typically equal to the total order amount.
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`18.
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`The funds Alicia Diagnostics expended and deposited in Iran to secure, export, and
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`deliver the products were not to be returned to Alicia Diagnostics until the products cleared
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`customs in the destination country.
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`19.
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`Once MOH approves the order and allocates funds, Alicia Diagnostics then had 45
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`days to submit proof of shipment before interest, fines, and late fees would be applied and deducted
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`from the order escrow and MOH collateral.
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`20.
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`If Alicia Diagnostics’ did not provide proof of shipment within 90 days, its license
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`would become delinquent and, at that point, Alicia Diagnostics would be barred from applying for
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`additional licenses until full delivery was made plus Alicia Diagnostics’ principals could be subject
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`to arrest in Iran for various crimes including fraud and money laundering.
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`21.
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`Additionally, if any delay in manufacturing or delivery of Medline products would
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`occur, Alicia Diagnostics’ deposited funds would be locked up in non-interest-bearing places and
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`would be inaccessible.
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`22.
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`Unfortunately, over the course of Alicia Diagnostics and Medline’s relationship,
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`Medline has failed to timely deliver on any of Alicia Diagnostics’ orders. As a result of Medline’s
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`failures, Alicia Diagnostics has experienced significant damages, including loss of profits, fines,
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`penalties and loss of licenses.
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`23.
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`These delays are in direct violation of the promises inherent in the Distribution
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`Agreement between Alicia Diagnostics and Medline.
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`24.
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`Pursuant to the Distribution Agreement, the parties agreed to litigate any and all
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`disputes in “the federal courts of Illinois encompassing Mundelein, IL.”
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`25.
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`All conditions precedent to the maintenance of this action have been performed,
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`4
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`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 5 of 17 PageID #:5
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`excused or waived.
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`26.
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`Plaintiff has retained an attorney to prosecute its interests in this matter, and is
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`obligated to pay reasonable attorneys’ fees for services.
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`COUNT I – BREACH OF DISTRIBUTION AGREEMENT
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`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 above.
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`This is a cause of action by Alicia Diagnostics against Medline for breach of
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`27.
`
`28.
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`contract.
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`29.
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` In the Distribution Agreement, Medline appointed Alicia Diagnostics as its
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`exclusive distributor of certain products in Iran. In exchange for such appointment and
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`commitment, Alicia Diagnostics made numerous promises and significant commitments to
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`Medline. Thus, the parties had an express, enforceable agreement. See Exhibit “A.”
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`30.
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`One of such commitments was minimum purchase obligations for each 12 month
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`period for five years. Another such commitment was an exclusive relationship between these
`
`parties regarding purchase, distribution, and promotion of certain products, including rights of first
`
`refusal.
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`31.
`
` In the Distribution Agreement, Medline additionally committed to quality terms
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`and conditions of its products.
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`32.
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`Considering these commitments, Alicia Diagnostics made business plans and
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`relationships with other parties, expended time, money, and resources toward such business
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`relationships, and declined other business opportunities due to the commitments to Medline.
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`Furthermore, Alicia Diagnostics was precluded from filling the voids caused by Medline’s failures
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`due to the exclusive nature of the Distribution Agreement.
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`33. Medline breached the Distribution Agreement in material respects by (1) failing to
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`5
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`timely manufacture and deliver products to Alicia Diagnostics; (2) failing to timely cure any delays
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`or product deficiencies caused by Medline; (3) failing to allow Alicia Diagnostics to meet the
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`minimum purchase obligations; and (4) failing to meet its commitments to Alicia Diagnostics.
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`34.
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`As a result of Medline’s breaches, Alicia Diagnostics has suffered damages,
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`including but not limited to, lost profits, lost opportunities, fines, penalties, legal costs, forfeited
`
`deposits, loss of licenses, and destruction of relationships and reputation with other parties. Alicia
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`Diagnostics’ damages regarding Medline’s breach of the Distribution Agreement exceed
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`$1,000,000 (One Million dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
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`COUNT II - BREACH OF DUTY OF GOOD FAITH AND FAIR DEALING
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`35.
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 29
`
`through 32 above.
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`36.
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`This is a cause of action by Alicia Diagnostics against Medline for breach of the
`
`implied duty of good faith and fair dealing.
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`37. Medline breached the implied covenant of good faith and dealing in the Distribution
`
`Agreement by (1) failing to timely manufacture and deliver products to Alicia Diagnostics; (2)
`
`failing to timely cure any delays or product deficiencies caused by Medline; (3) failing to allow
`
`Alicia Diagnostics to meet the minimum purchase obligations, and (4) failing to meet its
`
`commitments to Alicia Diagnostics.
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`38. Medline further breached the implied covenant of good faith and fair dealing by
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`continuously assuring timely delivery and product availability to Alicia Diagnostics despite the
`
`lack of ability to do so and refusing to rectify the problems.
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`6
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`39.
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`As a direct and proximate cause of Medline’s breaches of the implied covenant of
`
`good faith and fair dealing, Alicia Diagnostics suffered significant damages. Alicia Diagnostics’
`
`damages regarding these breaches exceed $1,000,000 (One Million dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT III - BREACH OF CONTRACT
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 above.
`
`This is a cause of action by Alicia Diagnostics against Medline for breach of
`
`40.
`
`41.
`
`contract.
`
`42.
`
` On June 9, 2017 a pro forma invoice was submitted by Alicia Diagnostics and its
`
`partner located in Iran, DG Dena, to MOH for an Advanced Wound Care order from Medline
`
`(“First AWC Order”).
`
`43.
`
`On August 24, 2017, Medline submitted a Proforma/Quote for the First AWC Order
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`(“First AWC Order Invoice”), containing Alicia Diagnostics’ customer number, which states
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`delivery would be made between 4-6 weeks. A true and correct copy of the First AWC Order
`
`Invoice is attached as Exhibit “B.” Alicia Diagnostics paid Medline for the First AWC Order.
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`44.
`
`Despite promises of timely deliverance, the First AWC Order was not shipped by
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`Medline within 4-6 weeks. Instead it was shipped over 6 months later, on March 17, 2018.
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`45.
`
`Due to Medline’s long delay, Alicia Diagnostics lost all profits on the First AWC
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`Order. In addition, Alicia Diagnostics incurred (a) late fees and fines by MOH associated with the
`
`delay, and (b) fees and costs to appeal and fight their loss of license.
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`46. Medline and Alicia Diagnostics had an enforceable agreement for the timely
`
`delivery of the First AWC Order.
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`7
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`47. Medline breached the agreement in material respects by 1) failing to timely
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`manufacture and deliver the products to Alicia Diagnostics; and 2) failing to timely cure any delay
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`and defects caused by Medline.
`
`48.
`
`As a direct and proximate cause of Medline’s breaches of the agreement, Alicia
`
`Diagnostics suffered damages. Alicia Diagnostics’ damages regarding the First AWC Order
`
`exceed $130,000 (One Hundred Thirty Thousand Dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT IV - BREACH OF DUTY OF GOOD FAITH AND FAIR DEALING
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`49.
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 42
`
`through 47 above.
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`50.
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`This is a cause of action by Alicia Diagnostics against Medline for breach of the
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`implied duty of good faith and fair dealing.
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`51. Medline breached the implied covenant of good faith and dealing in the Agreement
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`by continuously delaying manufacture and delivery of the First AWC Order, causing significant
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`damages to Alicia Diagnostics.
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`52. Medline further breached the implied covenant of good faith and fair dealing by
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`continuously assuring timely delivery and product availability to Alicia Diagnostics despite the
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`lack of ability to do so and refusing to rectify the problems, which caused damages to Alicia
`
`Diagnostics.
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`53.
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`As a direct and proximate result of Medline’s breaches of the implied covenant of
`
`good faith and fair dealing, Alicia Diagnostics suffered significant damages. Alicia Diagnostics’
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`damages regarding the First AWC Order exceed $130,000 (One Hundred Thirty Thousand
`
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`8
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`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 9 of 17 PageID #:9
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`Dollars).
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`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
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`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
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`COUNT V - BREACH OF EXPRESS WARRANTY
`UNIFORM COMMERCIAL CODE § 2-301, ET AL.
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`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 42
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`54.
`
`through 46 above.
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`55.
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`This is an action for monetary damages against Medline for breach of an express
`
`warranty pursuant to Uniform Commercial Code § 2-301, et al. To the extent required, Count V
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`is pled in the alternative to Counts III and IV.
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`56.
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`Alicia Diagnostics entered into a contract for the First AWC Order whereby
`
`Medline made express warranties, promises, and affirmations that it would sell and deliver
`
`products to Alicia Diagnostics.
`
`57.
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`Alicia Diagnostics relied upon Medline’s express warranties, affirmations,
`
`promises, and assurances.
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`58. Medline breached the express warranties by (1) failing to timely manufacture and
`
`deliver the products to Alicia Diagnostics; and (2) failing to timely cure any delay and defects
`
`caused by Medline.
`
`59.
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`As a direct and proximate result of Medline’s breach of the express warranties,
`
`Alicia Diagnostics has suffered damages, including but not limited to, lost profits, lost
`
`opportunities, fines, penalties, legal costs, forfeited deposits, loss of licenses, and destruction of
`
`relationships and reputation with other parties.
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
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`9
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`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 10 of 17 PageID #:10
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`COUNT VI- BREACH OF CONTRACT
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`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 above.
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`This is a cause of action by Alicia Diagnostics against Medline for breach of
`
`60.
`
`61.
`
`contract.
`
`62.
`
`On May 14, 2018, Medline submitted a Proforma Invoice for a Second AWC Order
`
`(“Second AWC Order Invoice”), containing Alicia Diagnostics’ customer number, which states
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`delivery “30 days post Pre-payment.” A true and correct copy of the Second AWC Order Invoice
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`is attached as Exhibit “C.”
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`63.
`
`On June 7, 2018, a proforma invoice was submitted by Alicia Diagnostics and its
`
`partner located in Iran, DG Dena, to MOH for the Advanced Wound Care order (“Second AWC
`
`Order”).
`
`64.
`
`After the proforma invoice was submitted to MOH for the Second AWC Order,
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`Alicia Diagnostics confirmed product availability with Medline and submitted a deposit to
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`Medline on July 26, 2018.
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`65.
`
` Unfortunately, despite confirming and promising product availability, Medline
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`subsequently informed Alicia Diagnostics it could not deliver on time. In addition, Medline
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`shipped a portion of products identified as dangerous goods without notifying Alicia Diagnostics,
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`which resulted in rejection of the shipment and further delay. Medline also shipped a portion of
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`products with empty boxes and incorrect pallet configurations, which resulted in further delay and
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`additional curative costs to Alicia Diagnostics. Medline also failed to provide a certificate of
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`origin, causing further delays.
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`66. Medline did not process the remaining product of the Second AWC Order until
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`April 3, 2019.
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`10
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`67.
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` As a result of the extreme delays, Alicia Diagnostics was unable to apply for
`
`additional import licenses for the entire duration of Medline’s delay of the Second AWC Order.
`
`68.
`
`Due to Medline’s long delay, Alicia Diagnostics lost all profits on the Second AWC
`
`Order. In addition, Alicia Diagnostics incurred (a) late fees and fines by MOH associated with the
`
`delay; and (b) fees and costs to appeal and fight their loss of license.
`
`69. Medline and Alicia Diagnostics had an enforceable agreement for the timely
`
`delivery of the Second AWC Order.
`
`70. Medline breached the agreement in material respects by (a) failing to timely
`
`manufacture and deliver the products to Alicia Diagnostics; and (b) failing to timely cure any delay
`
`and defects caused by Medline.
`
`71.
`
`As a direct and proximate result of Medline’s breaches of the agreement, Alicia
`
`Diagnostics suffered damages. Alicia Diagnostics’ damages regarding the Second AWC Order
`
`exceed $68,000 (Sixty-Eight Thousand Dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT VII- BREACH OF DUTY OF GOOD FAITH AND FAIR DEALING
`
`72.
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 62
`
`through 70 above.
`
`73.
`
`This is a cause of action by Alicia Diagnostics against Medline for breach of the
`
`implied duty of good faith and fair dealing.
`
`74. Medline breached the implied covenant of good faith and fair dealing in the
`
`Agreement by continuously delaying manufacture and delivery of the Second AWC Order, causing
`
`significant damages to Alicia Diagnostics.
`
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`11
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`75. Medline further breached the implied covenant of good faith and fair dealing by
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`continuously assuring timely delivery and product availability to Alicia Diagnostics despite the
`
`lack of ability to do so and refusing to rectify the problems, which caused damages to Alicia
`
`Diagnostics.
`
`76.
`
`As a direct and proximate cause of Medline’s breaches of the implied covenant of
`
`good faith and fair dealing, Alicia Diagnostics suffered significant damages. Alicia Diagnostics’
`
`damages regarding the Second AWC Order exceed $68,000 (Sixty-Eight Thousand Dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT VIII - BREACH OF EXPRESS WARRANTY
`UNIFORM COMMERCIAL CODE § 2-301, ET AL.
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 62
`
`77.
`
`through 69 above.
`
`78.
`
` This is an action for monetary damages against Medline for breach of an express
`
`warranty pursuant to Uniform Commercial Code § 2-301, et al. To the extent required, Count VIII
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`is pled in the alternative to Counts VI and VII.
`
`79.
`
`Alicia Diagnostics entered into a contract for the Second AWC Order whereby
`
`Medline made express warranties, promises, and affirmations that it would sell and deliver
`
`products to Alicia Diagnostics.
`
`80.
`
`Alicia Diagnostics relied upon Medline’s express warranties, affirmations,
`
`promises, and assurances.
`
`81. Medline breached the express warranties by (1) failing to timely manufacture and
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`deliver the products to Alicia Diagnostics; and (2) failing to timely cure any delay and defects
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`caused by Medline.
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`12
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`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 13 of 17 PageID #:13
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`82.
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`As a direct and proximate result of Medline’s breach of the express warranties,
`
`Alicia Diagnostics has suffered damages, including but not limited to, lost profits, lost
`
`opportunities, fines, penalties, legal costs, forfeited deposits, loss of licenses, and destruction of
`
`relationships and reputation with other parties.
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT IX – BREACH OF CONTRACT
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 above.
`
`This is a cause of action by Alicia Diagnostics against Medline for breach of
`
`83.
`
`84.
`
`contract.
`
`85.
`
`In early 2019, Medline committed to sell Alicia Diagnostics five 40-foot shipping
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`containers of OR Standard Surgical Gloves in three separate orders. The first order was for one
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`shipping container (“First Surgical Glove Order”). The second order was for two shipping
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`containers (“Second Surgical Glove Order”). The third order was for the remaining two shipping
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`containers (“Third Surgical Glove Order”). Documents supporting and evidencing the
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`commitment to these Orders are attached here collectively as Exhibit “D.”
`
`86.
`
`The First Surgical Glove Order was submitted to MOH in April 2019. Alicia
`
`Diagnostics paid Medline a deposit on this Order in April 2019.
`
`87.
`
` Due to Medline’s delays and failures, the First Surgical Glove Order was not
`
`delivered until December 2019.
`
`88.
`
`In or around September 2019, Alicia Diagnostics confirmed with Medline the
`
`Second Surgical Glove Order. Alicia Diagnostics paid Medline a deposit on this Order in
`
`December 2019.
`
`
`
`13
`
`
`
`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 14 of 17 PageID #:14
`
`89.
`
`Due to Medline’s delays and failures, the Second Surgical Glove Order was not
`
`delivered until the end of February 2020.
`
`90.
`
`In or around December 2019, Alicia diagnostics confirmed with Medline the Third
`
`Surgical Glove Order. However, due to Medline’s previous delays and failures, the Third Surgical
`
`Glove Order was never delivered.
`
`91.
`
`Each time a Glove Order was delayed and not timely delivered, the MOH reduced
`
`the price it was willing to pay for such order. In addition, Alicia Diagnostics incurred fines, costs,
`
`and legal fees in fighting and negotiating with the MOH in attempt to continue being allowed to
`
`do business and deliver products.
`
`92.
`
`Due to Medline’s lengthy delays and failure to deliver on these Glove Orders,
`
`Alicia Diagnostics lost profits on the First, Second, and Third Surgical Glove Orders. In addition,
`
`Alicia Diagnostics incurred (a) late fees and fines by MOH associated with the delay; and (b) fees
`
`and costs to appeal and fight their loss of license.
`
`93. Medline and Alicia Diagnostics had an enforceable agreement for the timely
`
`delivery of five containers of surgical gloves.
`
`94.
`
`Based on Medline’s commitment to five containers of surgical gloves, Alicia
`
`Diagnostics received commitments from its customers for an additional order of five containers
`
`during 2020. Due to Medline’s delays and failure to deliver, the additional order of five containers
`
`was never fulfilled.
`
`95. Medline breached the agreement in material respects by (a) failing to timely
`
`manufacture and deliver the products to Alicia Diagnostics; and (b) failing to timely cure any delay
`
`and defects caused by Medline.
`
`96.
`
`As a direct and proximate cause of Medline’s breaches of this agreement, Alicia
`
`
`
`14
`
`
`
`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 15 of 17 PageID #:15
`
`Diagnostics suffered damages. Alicia Diagnostics’ damages regarding the initial five container
`
`glove order exceed $600,000 (Six Hundred Thousand Dollars). The damages regarding the
`
`additional five container glove order exceed $240,000 (Two Hundred Forty Thousand Dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT X - BREACH OF DUTY OF GOOD FAITH AND FAIR DEALING
`
`97.
`
`Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 85
`
`through 95 above.
`
`98.
`
`This is a cause of action by Alicia Diagnostics against Medline for breach of the
`
`implied duty of good faith and fair dealing.
`
`99. Medline breached the implied covenant of good faith and dealing in the agreement
`
`by continuously delaying manufacture and delivery of the First, Second, and Third Surgical Glove
`
`Orders, causing significant damages to Alicia Diagnostics.
`
`100. Medline further breached the implied covenant of good faith and fair dealing by
`
`continuously assuring timely delivery and product availability to Alicia Diagnostics despite the
`
`lack of ability to do so and refusing to rectify the problems, which caused damages to Alicia
`
`Diagnostics.
`
`101. As a direct and proximate cause of Medline’s breaches of the implied covenant of
`
`good faith and fair dealing, Alicia Diagnostics suffered significant damages. Alicia Diagnostics’
`
`damages regarding the initial five container glove order exceed $600,000 (Six Hundred Thousand
`
`Dollars). The damages regarding the additional five container glove order exceed $240,000 (Two
`
`Hundred Forty Thousand Dollars).
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`
`
`15
`
`
`
`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 16 of 17 PageID #:16
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`COUNT XI - BREACH OF EXPRESS WARRANTY
`UNIFORM COMMERCIAL CODE § 2-301, ET AL.
`
`102. Plaintiff re-alleges and incorporates by reference Paragraphs 1 through 26 and 85
`
`through 94 above.
`
`103. This is an action for monetary damages against Medline for breach of an express
`
`warranty pursuant to Uniform Commercial Code § 2-301, et al. To the extent required, Count XI
`
`is pled in the alternative to Counts IX and X.
`
`104. Alicia Diagnostics entered into a contract for five containers of surgical gloves
`
`whereby Medline made express warranties, promises, and affirmations that it would sell and
`
`deliver products to Alicia Diagnostics.
`
`105. Alicia Diagnostics relied upon Medline’s express warranties, affirmations,
`
`promises, and assurances.
`
`106. Medline breached the express warranties by (a) failing to timely manufacture and
`
`deliver the products to Alicia Diagnostics; and (b) failing to timely cure any delay and defects
`
`caused by Medline.
`
`107. As a direct and proximate result of Medline’s breach of the express warranties,
`
`Alicia Diagnostics has suffered damages, including but not limited to, lost profits, lost
`
`opportunities, fines, penalties, legal costs, forfeited deposits, loss of licenses, and destruction of
`
`relationships and reputation with other parties.
`
`WHEREFORE, Alicia Diagnostics, Inc. demands judgment against Medline Industries,
`
`Inc. for damages, interest, costs, and all other relief the Court deems just and proper.
`
`
`
`
`
`
`
`16
`
`
`
`Case: 1:21-cv-00834 Document #: 1 Filed: 02/13/21 Page 17 of 17 PageID #:17
`
`DEMAND FOR TRIAL BY JURY
`
`Plaintiff demands a trial by jury on all issues so triable.
`
`
`
`
`
`
`
`
`
`
`
`
`
`Respectfully submitted,
`
`
`
`
`
`
`ALICIA DIAGNOSTICS, INC.,
`
`By: /s/ Richard G. Douglass
`One of Their Attorneys
`
`
`
`
`
`
`Richard G. Douglass
`DOUGLASS & LADISCH DOUGLASS P.C.
`638 S. Fairview Ave.
`Elmhurst, IL 60126
`(773) 726-4983
`rich@douglasspc.com
`ARDC # 6282777
`
`Of Counsel
`
`Thomas S. Cargill
`MORGAN & MORGAN P.A.
`Business Trial Group
`20 N. Orange Ave, Suite 1600
`Orlando, Florida 32801
`Telephone: (407) 420-1414
`Facsimile: (407) 245-3337
`TCargill@forthepeople.com
`LAbbott@forthepeople.com
`
`Attorneys for Plaintiff
`
`
`
`
`
`
`17
`
`
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