Case: 2:20-cv-05557-SDM-CMV Doc #: 17 Filed: 05/11/21 Page: 1 of 13 PAGEID #: 145
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF OHIO
`EASTERN DIVISION
`
`
`SNAP MEDICAL
`INDUSTRIES, LLC, et al.,
`
`
`Plaintiffs,
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`OPINION AND ORDER
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`This matter is before the Court for consideration of Defendant Beth Cross’s
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`Motion to Dismiss for Lack of Personal Jurisdiction. (Mot. to Dismiss, ECF No. 9.)
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`Plaintiffs have responded. (Resp., ECF No. 11.) No reply was filed. For the reasons
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`set forth below, Ms. Cross’s Motion is DENIED.
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`I.
`
`BACKGROUND
`The following summary draws from the allegations in the Amended
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`Complaint (Am. Compl., ECF No. 7) and the sworn declaration submitted with
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`Plaintiffs’ Response (ECF No. 11-1).
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`Plaintiff Snap Medical Industries is an Ohio limited liability company located
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`in Dublin, Ohio. (Am. Compl., ¶ 4.) Plaintiff Nancy Stamps, RN founded Snap to
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`produce, market, and sell FDA-registered epinephrine convenience kits. (Id., ¶¶ 10–
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`11.) In late-2015, Snap entered into a nonexclusive Sales Distribution Agreement
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`(“SDA”) with Defendant Focus Health Group, Inc. (Id., ¶ 12.) The relationship
`
`Case No. 2:20-cv-5557
`Judge Sarah D. Morrison
`Magistrate Judge Chelsey M.
`Vascura
`
`:
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`
`
`
`
` :
`
`
`
`
`
`v.
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`FOCUS HEALTH GROUP,
`INC., et al.,
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`Defendants.
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`

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`Case: 2:20-cv-05557-SDM-CMV Doc #: 17 Filed: 05/11/21 Page: 2 of 13 PAGEID #: 146
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`soured three years later when Focus principal, Defendant Fred McBee, sought “a
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`licensing agreement whereby Focus would produce and sell a product that was
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`essentially identical to Snap’s product,” except for an NDC labeler code and product
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`branding. (Id., ¶ 29.) Mr. McBee proposed the idea to Ms. Stamps as an opportunity
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`to “‘play a pricing game’ with [] major wholesalers and government contracts” by
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`offering two identical products at different price points. (Id., ¶ 30.) Ms. Stamps
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`rejected the proposal. (Id., ¶ 31.) A few months later, “Mr. McBee, Ms. Cross [(a
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`Focus employee)], and others at Focus asked Snap to print package cartons with the
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`Focus branding and a Focus NDC labeler code” and “began requesting detailed
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`product information about the Snap products.” (Id., ¶ 35.)
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`Snap terminated the SDA effective June 1, 2019. (Id., ¶ 40.) “[A]lmost
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`immediately after the termination of the SDA,” Focus began marketing and selling
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`a “copycat” epinephrine convenience kit under the brand name Epinephrine
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`Professional. (Id., ¶¶ 52, 55.) In doing so, Focus allegedly “falsely represented [the
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`Epinephrine Professional kits] as an improvement and replacement to Snap’s
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`products[.]” (Id., ¶ 54.) In one such instance on July 10, 2019, Ms. Cross sent an
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`email to Dublin, Ohio-based Cardinal Health, stating:
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`Our EpinephrineSnap-V (and ESnap-EMS) have undergone some
`product
`enhancements
`which
`requires NDC#
`changes.
`EpinephrineSnap-V, NDC# 70923-200-20 is now being replaced with
`and
`Epinephrine
`Professional,
`NDC#
`24357-011-13
`EpinephrineSnap-EMS, NDC# 70923-100-20 is being replaced with
`Epinephrine Professional EMS, NDC# 24357-012-12. The Epinephrine
`Professional sell sheets are attached for your review.
`Epinephrine Professional, NDC# 24357-011-13
`EpinephrineSnap-V 70912-100-20)
`
`(Replacing
`
`
`
`2
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`Case: 2:20-cv-05557-SDM-CMV Doc #: 17 Filed: 05/11/21 Page: 3 of 13 PAGEID #: 147
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`Epinephrine Professional EMS, NDC#24357-012-12 (Replacing
`EpinephrineSnap-V 71923-200-20)
`
` Epinephrine Professional offers an ‘all-in-one’ needle and syringe
`to save clinicians’ time during an emergency.
` Epinephrine Professional has an easily removeable tamper evident
`safety seal.
` Epinephrine Professional is the same FDA registered medical
`epinephrine convenience kit for an anaphylaxis emergency,
`meeting protocols and delivering compliance in a safe, effective,
`and AFFORDABLE product.
`To continue bringing savings to healthcare, we are reducing the kit
`WAC price on Epinephrine Professional, 24357-011-13
`Convenience Kit to $80.00 and Epinephrine Professional EMS,
`24357-012-12. To make the product replacement seamless, we would
`like to reduce the price of our existing EpinephrineSnap-V, 71923-200-
`20 and ESnap-EMS, 719823-100-20 (if stocked) to that same $80.00
`price as of July 10th.
`What may I provide, or what steps do I need to take to make these
`needed NDC# change and replacement?
`I will be in Dublin July 16th and 17th and it would be great to meet with
`you and your team to discuss the best way to proceed. Is this possible?
`Thank you so much for your efforts.
`(ECF No. 11-1, PAGEID # 105.)
`
`
`
`Plaintiffs brought suit against Focus, Mr. McBee, and Ms. Cross, alleging two
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`counts of tortious interference (Counts I and II), unfair competition under state law
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`(Count III), unfair competition under federal law (Count IV), deceptive trade
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`practices (Count V), and unjust enrichment (Count VI). (Am. Compl.) Ms. Cross now
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`moves for dismissal of all claims against her for lack of personal jurisdiction. (Mot.
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`to Dismiss.)
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`3
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`II.
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`STANDARD OF REVIEW
`Rule 12(b)(2) provides for dismissal of a lawsuit for lack of personal
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`jurisdiction. Fed. R. Civ. P. 12(b)(2). The plaintiff bears the burden of proving that
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`jurisdiction exists, Theunissen v. Matthews, 935 F.2d 1454, 1458 (6th Cir. 1991),
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`“over each defendant independently.” Beydoun v. Wataniya Rests. Holding, Q.S.C.,
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`768 F.3d 499, 504 (6th Cir. 2014) (quoting Days Inns Worldwide, Inc. v. Patel, 445
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`F.3d 899, 904 (6th Cir. 2006)). “[I]n the face of a properly supported motion for
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`dismissal, the plaintiff may not stand on his pleadings but must, by affidavit or
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`otherwise, set forth specific facts showing that the court has jurisdiction.”
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`Theunissen, 935 F.2d at 1458. If a court rules on a Rule 12(b)(2) motion prior to
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`trial, “it has the discretion to adopt any of the following courses of action: (1)
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`determine the motions based on affidavits alone; (2) permit discovery, which would
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`aid in resolution of the motion; or (3) conduct an evidentiary hearing on the merits
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`of the motion.” Intera Corp. v. Henderson, 428 F.3d 605, 614 n.7 (6th Cir. 2005)
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`(citation omitted). “[T]he decision whether to grant discovery or an evidentiary
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`hearing before ruling on a 12(b)(2) motion is discretionary.” Burnshire Dev., LLC v.
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`Cliffs Reduced Iron Corp., 198 F. App’x 425, 434 (6th Cir. 2006) (citation omitted).
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`Here, no party has requested further discovery or an evidentiary hearing, and the
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`Court concludes that neither is necessary to rule on Ms. Cross’s Motion.
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`When a court resolves a Rule 12(b)(2) motion based on “written submissions
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`and affidavits . . . , rather than resolving the motion after an evidentiary hearing or
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`limited discovery, the burden on the plaintiff is ‘relatively slight,’ and ‘the plaintiff
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`must make only a prima facie showing that personal jurisdiction exists in order to
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`defeat dismissal.’” Air Prods. & Controls, Inc. v. Safetech Int’l, Inc., 503 F.3d 544,
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`549 (6th Cir. 2007) (quoting Am. Greetings Corp. v. Cohn, 839 F.2d 1164, 1169 (6th
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`Cir. 1988); Theunissen, 935 F.2d at 1458) (cleaned up). A plaintiff can meet the
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`burden by “establishing with reasonable particularity sufficient contacts between
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`[it] and the forum state to support jurisdiction.” Neogen Corp. v. Neo Gen Screening,
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`Inc., 282 F.3d 883, 887 (6th Cir. 2002) (quoting Provident Nat’l Bank v. Cal. Fed.
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`Sav. Loan Ass’n, 819 F.2d 434, 437 (3d Cir. 1987)). In the absence of an evidentiary
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`hearing, courts apply the prima facie standard weighing the evidence in the light
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`most favorable to the plaintiff. Dean v. Motel 6 Operating L.P., 134 F.3d 1269, 1272
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`(6th Cir. 1998). Nonetheless, the court may consider a defendant’s undisputed
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`factual assertions. Conn v. Zakharov, 667 F.3d 705, 711 (6th Cir. 2012). If “there
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`does not appear to be any real dispute over the facts relating to jurisdiction, the
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`prima facie proposition loses some of its significance.” Id. (internal quotations and
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`citation omitted).
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`In support of their Response, Plaintiffs filed a sworn declaration of Jonathan
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`P. Corwin, counsel for Plaintiffs, and email correspondence between Ms. Cross and
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`Cardinal Health. (ECF No. 11-1.)
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`III. ANALYSIS
`“Federal courts ordinarily follow state law in determining the bounds of their
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`jurisdiction over persons.” Daimler AG v. Bauman, 571 U.S. 117, 125 (2014)
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`(citation omitted). In a diversity action1, the law of the forum state is applied to
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`1 Although this Court also has federal question subject matter jurisdiction
`over Count Four (Unfair Competition — 15 U.S.C. § 1125) and supplemental
`5
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`decide whether personal jurisdiction exists. Calphalon Corp. v. Rowlette, 228 F.3d
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`718, 721 (6th Cir. 2000). Because “Ohio’s long-arm statute is not coterminous with
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`federal constitutional limits,” to establish a prima facie case of personal jurisdiction,
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`a plaintiff must demonstrate that (1) Ohio’s long-arm statute has been satisfied and
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`(2) exercising jurisdiction would comport with the Due Process Clause of the
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`Fourteenth Amendment of the United States Constitution. Schneider v. Hardesty,
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`669 F.3d 693, 699 (6th Cir. 2012) (internal quotations omitted); Kauffman Racing
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`Equip., LLC v. Roberts, 930 N.E.2d 784, 790 (Ohio 2010).
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`Ohio’s Long-Arm Statute
`A.
` “Ohio’s long-arm statute grants Ohio courts personal jurisdiction over a non-
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`resident if his conduct falls within the nine bases for jurisdiction listed by the
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`statute.” Conn, 667 F.3d at 712. Plaintiffs assert that Ohio’s long-arm statute
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`confers upon this Court personal jurisdiction over Ms. Cross, and point to two
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`provisions of the statute, in particular:
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`(A) A court may exercise personal jurisdiction over a person who acts
`directly or by an agent, as to a cause of action arising from the person’s:
`. . .
`(3) Causing tortious injury by an act or omission in this state; . . . [or]
`(6) Causing tortious injury in this state to any person by an act
`outside this state committed with the purpose of injuring persons,
`when the person might reasonably have expected that some person
`would be injured thereby in this state [.]
`
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`jurisdiction over the remaining claims (see Am. Compl., ¶ 7), the parties’ briefing
`treats the action as though purely based on diversity. Accordingly, the Court will do
`the same. Cf. Neogen, 282 F.3d at 887.
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`6
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`Ohio Rev. Code § 2307.382. Curiously, Ms. Cross did not find it necessary to address
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`whether she is subject to Ohio’s long-arm statute. The Court agrees with Plaintiffs.
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`Plaintiffs first argue that Ms. Cross’s conduct falls under subsection (A)(3)
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`because she traveled to Ohio in furtherance of the alleged tortious scheme against
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`Plaintiffs. Ms. Cross does not rebut or respond to this assertion. Plaintiffs next
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`argue that Ms. Cross’s alleged conduct brings her within subsection (A)(6).
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`Pertinent here, “district courts have found that fraudulent communications or
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`misrepresentations directed at Ohio residents satisfy § 2307.382(A)(6)’s
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`requirements.” Schneider, 669 F.3d at 700 (citation omitted). Although “courts have
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`taken a broad approach to jurisdiction under” (A)(6), the statute does not apply
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`when a defendant could not have anticipated that the plaintiff would be injured in
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`Ohio. Grigor v. Starmark Hosp. Grp. LLC, No. 2:10-cv-20, 2010 WL 2403137, at *5
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`(S.D. Ohio June 10, 2010) (Frost, J.) (quoting Shaker Constr. Grp., LLC v. Schilling,
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`No. 1:08-cv-278, 2008 WL 4346777 (S.D. Ohio Sept. 18, 2008) (Dlott. J.)). Plaintiffs
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`allege that Ms. Cross sent email correspondence to Cardinal Health (an Ohio-based
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`company) containing misrepresentations about the epinephrine convenience kit
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`produced by Snap (another Ohio-based company) and in furtherance of a tortious
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`“bait-and-switch” scheme. Ms. Cross could have anticipated that any injury
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`resulting from the emails would be suffered in Ohio.
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`The Court finds that its exercise of personal jurisdiction over Ms. Cross
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`comports with Ohio’s long-arm statute.
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`7
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`B. Due Process Clause
`If a defendant is found amenable to suit through Ohio’s long-arm statute,
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`attention turns to the Due Process Clause, “recognizing that a defect of this type
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`would foreclose the exercise of personal jurisdiction even where a properly
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`construed provision of the long-arm statute would otherwise permit it.” Theunissen,
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`935 F.2d at 1459. To satisfy due process, a court’s exercise of its power over an out-
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`of-state defendant must “not offend ‘traditional notions of fair play and substantial
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`justice.’” Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (citation omitted).
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`“[T]he defendant’s conduct and connection with the forum State [must be] such that
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`he should reasonably anticipate being haled into court there.” World-Wide
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`Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). The Due Process Clause of
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`the Fourteenth Amendment recognizes two types of personal jurisdiction—general
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`and specific—either one of which is adequate to confer jurisdiction over a defendant.
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`Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011).
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`“If a court has general jurisdiction over a defendant, it can adjudicate any
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`claims involving that defendant, regardless of where the cause of action arose.”
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`Maclin v. Reliable Reports of Tex., Inc., 314 F. Supp. 3d 845, 849 (N.D. Ohio 2018).
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`“For an individual, the paradigm forum for the exercise of general jurisdiction is the
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`individual’s domicile; for a corporation, it is an equivalent place, one in which the
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`corporation is fairly regarded as at home[,]” such as the corporation’s place of
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`incorporation and its principal place of business. Goodyear, 564 U.S. at 924. General
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`jurisdiction may also exist over an out-of-state corporation when its contacts with
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`the forum state “are so continuous and systematic as to render it essentially at
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`home in the forum state.” BNSF Ry. Co. v. Tyrrell, 137 S.Ct.1549, 1558 (2017).
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`Plaintiffs concede that this Court does not have general jurisdiction over Ms. Cross.
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`“Specific jurisdiction refers to jurisdiction over claims arising from or related
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`to a defendant’s contacts with the forum state.” Maclin, 314 F. Supp. 3d at 849. The
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`Sixth Circuit has “promulgated a three-prong test that not only guides the
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`determination of whether specific jurisdiction exists, but also protects the due
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`process rights of a defendant[:]”
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`First, the defendant must purposefully avail himself of the privilege of
`acting in the forum state or causing a consequence in the forum state.
`Second, the cause of action must arise from the defendant’s activities
`there. Finally, the acts of the defendant or consequences caused by the
`defendant must have a substantial enough connection with the forum
`state to make the exercise of jurisdiction over the defendant reasonable.
`S. Mach. Co. v. Mohasco Indus., Inc., 401 F.2d 374, 381 (6th Cir. 1968). “Failure to
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`meet any one of the three prongs means that personal jurisdiction may not be
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`invoked.” Maclin, 314 F. Supp. 3d at 849.
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`1. Ms. Cross purposefully availed herself of the privilege of
`doing business in Ohio.
`Under Southern Machine, the Court first looks to whether Ms. Cross
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`purposefully availed herself of the privilege of conducting business in Ohio. The
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`Court determines that she has. “In the Sixth Circuit, the emphasis in the
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`purposeful availment inquiry is whether the defendant has engaged in some overt
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`actions connecting the defendant with the forum state.” Beydoun, 768 F.3d at 605
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`(quoting Fortis Corporate Ins. v. Viken Ship Mgmt., 450 F.3d 214, 218 (6th Cir.
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`2006)). “[T]he issue is not the quantity, but the quality of a defendant’s contacts
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`with the forum state.” MAG IAS Holdings, Inc. v. Schmückle, 854 F.3d 894, 901 (6th
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`9
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`Cir. 2017) (citations omitted). Although “physical presence in the forum state is not
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`required,” it “is certainly a relevant contact.” Id. at 900 (quoting Burger King Corp.
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`v. Rudzewicz, 471 U.S. 462, 475 (1985); Walden v. Fiore, — U.S. —, 134 S.Ct. 1115,
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`1123 (2014)). Courts have held that directing correspondence to the forum state is
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`also a relevant contact and can itself establish personal jurisdiction when the
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`correspondence gives rise to the action. See, e.g., S. Mach. Co., 401 F.2d at 382;
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`Schmückle, 854 F.3d at 902.
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`Here, Ms. Cross sent a series of emails directed at Cardinal Health—a large
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`pharmaceutical supply distributor headquartered in Dublin, Ohio—allegedly in
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`furtherance of a tortious scheme to replace Snap’s products for Focus’s. The July 10
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`email indicates that Ms. Cross intended to travel to Dublin the following week and
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`sought meetings with the Cardinal Health contracting team. These contacts are
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`sufficient to establish that Ms. Cross purposefully availed herself of the privilege of
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`conducting business in Ohio.
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`Ms. Cross argues in favor of the opposite conclusion by pointing out that her
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`contacts with Ohio were in a professional, and not personal, capacity. However, “the
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`mere fact that the actions connecting defendants to the state were undertaken in an
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`official rather than personal capacity does not preclude the exercise of personal
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`jurisdiction over those defendants” where the defendant “is actively and personally
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`involved in the conduct giving rise to the action.” Balance Dynamics Corp. v.
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`Schmitt Indus., Inc., 204 F.3d 683, 698 (6th Cir. 2000). Ms. Cross’s emails to
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`10
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`Cardinal Health show that she was actively and personally involved in the conduct
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`giving rise to this action. Her argument, therefore, fails.
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`Plaintiffs’ claims arise from Ms. Cross’s activities in Ohio.
`2.
`The Court next examines whether Plaintiffs’ claims arise out of Ms. Cross’s
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`activities in Ohio. The Sixth Circuit has explained,
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`[t]o satisfy the “arising from” prong of the Southern Machine test, the
`plaintiff must demonstrate a causal nexus between the defendant’s
`contacts with the forum state and the plaintiff's alleged cause of action.
`See Burger King Corp., 471 U.S. at 474, 105 S.Ct. 2174 (“[I]t may well
`be unfair to allow [out-of-state parties] to escape having to account in
`other States for consequences that arise proximately from such
`activities.”). As our circuit has explained, “the cause of action
`must . . . have a substantial connection with the defendant's in-state
`activities.” [Dean, 134 F.3d at 1275] (quotation marks omitted). Put
`another way, “[t]he ‘arising from’ requirement under the second prong
`[of the Southern Machine test] is satisfied when the operative facts of
`the controversy arise from the defendant's contacts with the state. ‘Only
`when the operative facts of the controversy are not related to the
`defendant's contact with the state can it be said that the cause of action
`does not arise from that contract.’” [Calphalon, 228 F.3d at 723–24]
`(quoting S. Mach. Co., 401 F.2d at 384 n. 29); see also Carrier Corp. v.
`Outokumpu Oyj, 673 F.3d 430, 451 (6th Cir. 2012) (“Even a single act by
`a defendant directed toward the relevant forum that gives rise to a cause
`of action can support” a finding of personal jurisdiction. (emphasis
`added, citation, quotation marks, and alterations omitted)).
`Beydoun, 768 F.3d at 506–07. Ms. Cross’s emails to Cardinal Health are part and
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`parcel of the conduct giving rise to this action.2 They form a part of the operative
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`facts of the Amended Complaint, which therefore arises out of Ms. Cross’s contacts
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`with Ohio.
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`2 The Sixth Circuit has acknowledged that there is overlap between the first
`and second prongs’ analysis. Beydoun, 768 F.3d at 507 (citations omitted).
`11
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`Ms. Cross argues that the second prong is not met—again, because her
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`conduct was in a professional capacity. Ms. Cross points to no authority overcoming
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`the clear dictates of the Sixth Circuit, or rebutting the assertion that she was
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`personally and actively involved in the conduct giving rise to the action.
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`3.
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`This Court’s exercise of jurisdiction over Ms. Cross is
`reasonable.
`Finally, the Court must determine whether its exercise of jurisdiction over
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`Ms. Cross is reasonable. “When the first two prongs of our personal jurisdiction test
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`are met, there is an inference of reasonableness and ‘only the unusual case will not
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`meet this third criteria.’” Schmückle, 854 F.3d at 903–04 (quoting Air Prods. &
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`Controls, 503 F.3d at 554). The reasonableness determination is made upon review
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`of the following three factors: “(1) the burden on the defendant; (2) the forum state’s
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`interest; and (3) the plaintiffs’ interest in obtaining relief.” Id. (citing City of Monroe
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`Emps. Ret. Sys. v. Bridgestone Corp., 399 F.3d 651, 666 (6th Cir. 2005)).
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`There is nothing unusual about this case that would rebut the inference of
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`reasonableness. Ms. Cross’s previous travel to Ohio evidences that the trip does not
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`present a great burden. Further, Ohio has an interest in ensuring that its citizens
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`are able to conduct their business free from misrepresentations and tortious harm,
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`such as those alleged here.
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`12
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`IV. CONCLUSION
`Plaintiffs have made a prima facie showing that this Court has personal
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`jurisdiction over Ms. Cross. Accordingly, Ms. Cross’s Motion to Dismiss (ECF No. 9)
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`is DENIED.
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`
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`IT IS SO ORDERED.
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`
`
`/s/ Sarah D. Morrison
`SARAH D. MORRISON
`UNITED STATES DISTRICT JUDGE
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`13
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