Civil Practice – Personal Jurisdiction – Foreign Corporation – Door-Closing Statute – Tort/Negligence – Civil Conspiracy – Unfair Trade Practices – Intellectual Property

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Where (1) defendant Lazarus Pharmaceuticals, Inc., is a Barbados corporation, which is not subject to personal jurisdiction in the courts of any state; (2) plaintiffs assert federal-law claims; (3) plaintiffs allege that Lazarus convinced a South Carolina resident to submit information to two drug databases so Lazarus could bring its allegedly infringing drug to market; and (4) plaintiffs also allege that Lazarus has sold its pharmaceutical product to consumers in South Carolina, this court has personal jurisdiction over Lazarus pursuant to Rule 4(k)(2), FRCP.

The court dismisses defendant Cameron Pharmaceuticals LLC from the lawsuit for lack of personal jurisdiction. The court denies Lazarus’ motion to dismiss for lack of personal jurisdiction but grants its motion to dismiss plaintiffs’ civil conspiracy claim.

Defendant Cameron Pharmaceuticals is incorporated in Kentucky, and its facilities are based there. Cameron has no facilities, property, or members in South Carolina. Plaintiffs do not allege that Cameron had any contact with Christopher Kelly (the South Carolina resident who listed Lazarus’ product on the drug databases). Cameron’s sales in South Carolina are de minimis, and plaintiffs have failed to allege that Cameron engaged in activity purposefully directed at South Carolina. The court lacks personal jurisdiction over Cameron.

Lazarus communicated with Kelley, who agreed to use his South Carolina address and submit the necessary information to bring Lazarus’ pharmaceutical product to market; therefore, plaintiffs’ claims against Lazarus arose in South Carolina, as required by S.C. Code Ann. § 15-5-150, South Carolina’s door-closing statute. Further, Lazarus has provided no authority for the proposition that a South Carolina statute may bar a federal court action based on federal question jurisdiction.

Plaintiffs’ complaint includes an unfair trade practices claim. Plaintiffs allege, “Defendants’ marketing of products developed through the unlawful use of plaintiffs’ confidential, proprietary, and trade secret information are deceptive to the public. . . .” Plaintiffs have also sufficiently pleaded that the alleged acts have the potential for repetition. Plaintiffs have thus sufficiently alleged an adverse impact on the public interest, and their claim under the South Carolina Unfair Trade Practices Act survives Lazarus’ motion to dismiss.

However, where plaintiffs fail to allege special damages, they have failed to state a claim for civil conspiracy.

Concordia Pharmaceuticals, Inc. v. Lazarus Pharmaceuticals, Inc. (Lawyers Weekly No. 002-183-18, 13 pp.) (Henry Herlong, S.J.) 6:18-cv-01658. Tory Ian Summey, Wesley Few and Scott Lloyd Smith for plaintiffs; Joseph Owen Smith, William Alexander Coates and Ian Ford for defendants. D.S.C.