Peak Performance Nutrition et al v. Media Power, Inc.

OPPOSITION to MOTION to Dismiss for Lack of Jurisdiction to dismiss for Improper Venue, to Transfer Action to District of Arizona Pursuant to 28 U.S.C. Section 1406

C.D. Cal.August 9, 2010

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Carlos F. Negrete, Esq. SBN # 134658 LAW OFFICES OF CARLOS F. NEGRETE 27422 Calle Arroyo San Juan Capistrano, CA 92675-2747 Telephone (949) 493-8115 Telefax (949) 493-8170 cnegrete@negretelaw.com Attorney for Defendant/Counter-Claimant/Third-Party Plaintiff MEDIAPOWER, INC. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA - SANTA ANA DIVISION PEAK PERFORMANCE NUTRITION, a Nevada Domestic Corporation, and WILLIAM E. WHEELER, Ph.D., an individual, Plaintiffs, v. MEDIAPOWER, INC., a Maine Corporation KENNETH W. BYERS, an individual, and KEN WRIGHT, an individual, Defendants. ______________________________ MEDIAPOWER, INC., a Maine Corporation, Counter-Claimant, v. PEAK PERFORMANCE NUTRITION, LTD., a Nevada Domestic Corporation, WILLIAM E. WHEELER, Ph.D., and ROES 1 through 25, inclusive. Counter-Defendants. ______________________________ MEDIAPOWER, INC., a Maine Corporation, Third Party Plaintiff, v. ISAGENIX INTERNATIONAL, LLC, INCUBATION LLC and ZOES 1 through 25 inclusive. Third-Party Defendants. ______________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No.: CV09-4933 AG (Shx) Case Assigned To: Hon. Judge Andrew Guilford Courtroom: 10D MEDIAPOWER, INC.’S OPPOSITION TO ISAGENIX’S MOTION FOR ODER TO DISMISS COMPLAINT FOR LACK OF PERSONAL JURISDICTION, OR TO TRANSFER ACTION TO DISTRICT OF ARIZONA PURSUANT TO 28 U.S.C. 1406(a) OR 1404(a), OR TO DISMISS FOR FAILURE TO STATE A CLAIM Hearing: August 30, 2010 Time: 10:00 a.m. Dept.: 10D MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 1 of 49 Page ID #:1231 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF CONTENTS MEMORANDUM OF POINTS AND AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . 2 I. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 II. ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 A. This Court Has Personal Jurisdiction over Isagenix . . . . . . . . . . . . . . . . . . . . . . . . .3 1. ISAGENIX Purposefully Directs its Activities Toward California . . . . . . . . 3 2. MPI’s Claims Against ISAGENX For Intentional Interference with Contractual Relations and Declaratory Relief Relate to California . . . . . . . . .6 B. The Exercise of Jurisdiction Over Isagenix is Reasonable . . . . . . . . . . . . . . . . . . . .6 1. Extent of Isagenix’ Interjection in California’s Affairs . . . . . . . . . . . . . . . . . 7 2. Burden on Isagenix of Defending in California . . . . . . . . . . . . . . . . . . . . . . . 7 3. Extent of Conflict With Sovereignty of Defendant’s State . . . . . . . . . . . . . . 8 4. California’s Interest in Adjudicating the Dispute . . . . . . . . . . . . . . . . . . . . . . 8 5. Most Efficient Judicial Resolution of Controversy . . . . . . . . . . . . . . . . . . . . .8 6. Importance of the Forum to MPI’s Interest in Convenient and Effective Relief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 7. Existence of an Alternative Forum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 C. The Central District of California Is the Proper Venue To Litigate This Claim . . . 9 D. In The Alternative, Limited Discovery Should Be Allowed For Determining Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 E. STANDARD OF REVIEW FOR REVIEWING A COMPLAINT IS A SUFFICIENT SHORT AND PLAIN STATEMENT UNDER FRCP §8 . . . . . . . . 10 F. EACH CAUSE OF ACTION IN COMPLAINT IS SUFFICIENTLY PLED . . . . 11 1. Intentional Interference with Contractual Relations is Properly Pled . . . . . 11 2. Declaratory Relief is Properly Pled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 G. IN THE EVENT THE MOTION TO DISMISS IS SUSTAINED, LIBERAL POLICY FAVORS GRANTING LEAVE TO AMEND COMPLAINT . . . . . . 12 III. CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 2 of 49 Page ID #:1232 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Aluminal Industries, Inc. v. Newtown Comm'l Assocs. (SD NY 1980) 89 FRD 326, 328 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Balistreri v. Pacifica Police Dept. (9 Cir. 1990) 901 F.2d 696, 699 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10th Burnham v. Sup.Ct., (1990) 495 US 604, 630-631, 110 S.Ct. 2105, 2121 . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Conley v. Gibson (1957) 355 U.S. 41, 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10, 11 Corcoran v. N.Y. Power Authority 935 F. Supp. 376, 382 (S.D.N.Y. 1996) . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . 11 Core-Vent Corp. v. Nobel Industries AB, 11 F.3d 1482, 1487-1488 (9th Cir. 1993). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 DeCarlo v. Fry (2nd Cir. 1998) 141 F.3d 56, 62.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 eMag Solutions, LLC v. Toda Kogyo Corp., 2006 WL 3783548, *2 (N.D. Cal 2006);. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Friedlander v. Nims (11th Cir. 1985) 755 F.2d 810, 813 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Gates Learjet Corp., 743 F.2d at 1333-1334 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 General Star Indemn. Co. v. Vesta Fire Ins. Corp. (5th Cir. 1999) 173 F.3d. 946, 950 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Grace v. MacArthur (ED AR 1959) 170 F.Supp. 442 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements, Ltd., 328 F.3d 1122, 1135 (9th Cir. 2003). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9 Hospital Building Co. v. Trustees of Rex College (1976) 425 U.S. 738, 746.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Integral Development Corp. v. Weissenbach 99 Cal.App.4th 576 (2002) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3, 6, 7 International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 6, 7 Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir. 1987). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Laub v. U.S. Dept. of Interior, 342 F.3d 1080, 1093 (9th Cir. 2003).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 3 of 49 Page ID #:1233 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Neitzke v.Williams (1989) 490 U.S. 319, 326 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Paccar Int’l, Inc. v. Commercial Bank of Kuwait, 757 F.2d 1058, 1065 (9th Cir. 1985). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Panavision Intern., L.P. v. Toeppen, 141 F.3d 1316, 1323 (9th Cir. 1998).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 Roth v. Garcia Marquez, 942 F.2d 617, 623 (9th Cir. 1991). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Scholz Research & Develop., Inc. v. Kurzke (ND IL 1989) 720 F.Supp. 710, 711 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir. 2004). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 (Silva v. Bieluch (11th Cir. 2003) 351 F.3d 1045, 1048;. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Sparling v. Hoffman Constr. Co. (9th Cir. 1998) 864 F.2d 635, 640.). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 U.S. v. Employing Plasterers Ass'n of Chicago (1954) 347 U.S. 186, 189 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 STATUTES Cal. Code Civ. Proc. §410.10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 28 U.S.C. §1404(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Federal Rule of Civil Procedure §8(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Fed. R. Civ. P. §8(a)(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Federal Rule of Civil Procedure §9(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Federal Rule of Civil Procedure §15(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 4 of 49 Page ID #:1234 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MPI’S OPPOSITION Defendant MEDIAPOWER, INC. hereby opposes ISAGENIX’s Motion to Dismiss (“MTD”) on the following grounds: 1) California has personal jurisdiction over ISAGENIX; 2) Extending personal jurisdiction over ISAGENIX is not unreasonable; 3) The Central District of California is the proper venue; 4) MPI has properly pled its claims against ISAGENIX. RELIEF REQUESTED 1) Motion to Dismiss be denied; 2) Grant MPI leave to conduct jurisdictional discovery; 3) Alternatively, grant leave to amend the Complaint. Respectfully Submitted, Dated: August 9, 2010 LAW OFFICES OF CARLOS F. NEGRETE ____/s/ Carlos F.Negrete_________ CARLOS F. NEGRETE Attorneys for Defendant/Counter- Claimant/Third- Party Plaintiff MEDIAPOWER, INC. 1MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 5 of 49 Page ID #:1235 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION On May 20, 2010, MEDIAPOWER, INC. (“MPI”) filed its Answer to Complaint and Counterclaims/Cross-Complaint against Peak Performance Nutrition, LTD., William E. Wheeler, Ph.d., Incubation, LLC, and Isagenix International LLC (“ISAGENIX”). MPI brought the following claims against ISAGENIX: 1) Intentional Interference with Contractual Relations and Declaratory Relief. On June 11, 2010, counsel for ISAGENIX, Elizabeth M. Weldon, waived service of summons on behalf of ISAGENIX. ISAGENIX’s and a response was due July 27, 2010. On July 19, 2010, Ms. Weldon sent a letter to MPI’s counsel indicating ISAGENIX would file a motion to dismiss MPI’s Counterclaims against ISAGENIX on the grounds that the court lacks personal jurisdiction over ISAGENIX, venue was improper, the action should be transferred to another venue, and that the Complaint fails to state a claim against ISAGENIX. See Exhibit A, attached herein to the Declaration of Carlos F. Negrete. On July 23, 2010, counsel for MPI, Mr. Negrete, spoke with Lyndsey Tadlock regarding Ms. Weldon’s letter. Ms. Tadlock sent Mr. Negrete a letter on July 23, 2010 in follow up to their conversation. See Exhibit B to the Declaration of Carlos F. Negrete. Again, Ms. Tadlock insisted that Isagenix would file a motion to dismiss. On July 26, 2010, Mr. Negrete wrote to Ms. Tadlock in follow up to the conversation and letter dated July 23, 2010. See Exhibit C to the Declaration of Carlos F. Negrete. Mr. Negrete pointed out that “Ms. Tadlock...ma[d]e no mention of the substance of [their] telephone conversation, wihich was presumably an attempt to conduct a good faith attempt at a meet & confer” as required by the Local Rule 7-3. Mr. Negrete further indicated: “Isagenix has representatives, customers and sells its products in California. In addition, Isagenix has availed itself of the California jurisdiction by its participation in a State Court action that arises from the same operative facts and parties.” Lastly, Mr. Negrete “proposed that if [Ms. Tadlock] pointed out any deficiencies that MediaPower would further discuss these grounds and, 1MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 6 of 49 Page ID #:1236 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 if well taken, would amend its Complaint to cure any deficiencies.” Ms. Tadlock was unwilling to even consider this suggestion. Decl. of C. Negrete ¶.9. This was evidence of a lack of good faith by counsel for ISAGENIX to resolve the issue before filing the instant motion. Id. On July 27, 2010, in a belated attempt to respond to Mr. Negrete’s good faith suggestion and letter of July 26, 2010, Ms. Tadlock stood firm on her issues with MPI’s Complaint failed to provide any substantive basis for the jurisdictional issues or contended deficiencies of the Complaint. See Exhibit D, attached to the Declaration of Carlos F. Negrete. However, only hours later, ISAGENIX filed the instant motion to dismiss, without giving MPI the opportunity to further address any deficiencies, and without coming to agreement to stipulate to give MPI time to address and amend any deficiencies before the motion would need to be pursued. Clearly, this is not in the spirit of Local Rule 7-3 ISAGENIX maintains California lacks personal jurisdiction over them because “Isagenix does not have any employees in the State of California, own real property in California, nor maintain an office in California.” (Decl. Of Kevin Adams ¶.3. attached to MTD). However, ISAGENIX clearly has substantial contacts within California to establish personal jurisdiction in this case. II. ARGUMENT California has a broad long-arm statute on personal jurisdiction. “A court of this state may exercise jurisdiction on any basis not inconsistent with the Constitution of this State or the United States.” Cal. Code Civ. Proc. §410.10; see also Integral Development Corp. v. Weissenbach 99 Cal.App.4th 576 (2002) (California “long arm” statute on personal jurisdiction “manifests an intent to exercise the broadest possible jurisdiction, limited only by constitutional considerations of due process”.) The due process clause of the Constitution requires that the defendant have “certain minimum contacts with the forum such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326 3MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 7 of 49 Page ID #:1237 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 U.S. 310, 316 (1945). An out-of-state defendant may be subject to specific jurisdiction if the following three-part test is met: (1) the non-resident defendant must purposefully direct his activities [at] or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim must be one which arises out of or relates to the defendant’s forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir. 2004), quoting Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir. 1987). A. This Court Has Personal Jurisdiction over Isagenix In this case, the Court has personal jurisdiction over ISAGENIX on the basis that: 1) ISAGENIX advertises and sells its products in California; 2) ISAGENIX authorizes independent agents to sell ISAGENIX products throughout the world, including California, while many agents also live in California; 3) ISAGENIX holds it annual trade show/celebration in California, with thousands of people attending; 4) ISAGENIX has previously submitted to the jurisdiction of California as a defendant and Cross-Complainant in the action Case No. 56-2008-00319337-CU-BC-VTA in the Superior Court of the State of California, County of Ventura, complaint filed on May 23, 2008, with ISAGENIX appearing as a Cross-Complainant and as a Cross-Defendant on December 10, 2009, filing its Cross-Complaint and also answering the Amended Cross-Complaint by Incubation LLC and Nature’s Pure Body Institute, Inc. 1. ISAGENIX Purposefully Directs its Activities Toward California ISAGENIX INTERNATIONAL LLC has planned its ‘Celebration 2010" in San 4MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 8 of 49 Page ID #:1238 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Diego, California from August 21-24. http://www.isagenixcelebration.com/, http://www.isaconvention.com/. The San Diego Convention Center website lists the event as a “Convention with Trade Show” indicating 6,000 attendees. There is also the1 Isagenix Celebration planned for next year, August 14-August 16, 2011, with 8,000 attendees. Further, ISAGENIX offers podcasts of business training online. One such podcast was recorded on June 20, 2009, where ISAGENIX trainer, and Senior Vice President and Chief Training Officer David Wood held a business training event in anticipation of the “Living the Dream” event in Anaheim, California on August 8-10, 2009. (http://www.isagenixpodcast.com/2009/06/). Further, ISAGENIX authorizes Independent Agents throughout the world, including California, to sell its products to consumers. For example, independent agents reside in Glendale, Escondido, San Diego, and San Francisco to sell conveniently to California residents and to recruit2 other Independent Agents who reside in California. Such products include those that are alleged by MPI to compete directly with the Gold Standard Protein (“GSP”) product that MPI purchased from Incubation. Four justices find anyone knowingly entering the state can reasonably expect being haled into court if served there. Moreover, “(b)y visiting the forum State, a transient defendant actually avails himself of significant benefits provided by the State” (e.g., health and safety, police, fire and emergency medical services, freedom to travel on state roads). [Brennan, J. concur.opn. in Burnham v. Sup.Ct., (1990) 495 US 604, 630-631, 110 S.Ct. 2105, 2121]. Several courts have upheld jurisdiction in such cases, adhering literally to the “physical power” theory. Scholz Research & Develop., Inc. v. Kurzke (ND IL 1989) 720 F.Supp. 710, 711-nonresident served while attending trade show; Aluminal Industries, Inc. v. Newtown Comm'l Assocs. (SD NY 1980) 89 FRD http://www.sdccc.org/eventscalendar/searchdate.cfm?startMonth=8&startMonthDay=8&startY1 ear=2010&endMonth=8&endMonthDay=25&endYear=2010 Google “Isagenix Independent Agent California”2 5MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 9 of 49 Page ID #:1239 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 326, 328-nonresident served at New York City airport; Grace v. MacArthur (ED AR 1959) 170 F.Supp. 442-nonresident served in airplane flying over state]. ISAGENIX has counsel in California who agreed to accept service on ISAGENIX’s behalf and also waived service of summons. See Exhibit F. 2. MPI’s Claims Against ISAGENIX For Intentional Interference with Contractual Relations and Declaratory Relief Relate to California MPI has an Agreement with Incubation executed in November 2006. The License agreement permitted MPI an exclusive license to use the likeness of Dr. Wheeler during the terms of the Agreement to advertise, sell various products including GSP. However, Dr. Wheeler, through ISAGENIX, has introduced a competitive product on the market in a scheme and plot to hijack sales and revenue of GSP, and interfering with MPI’s contractual Agreement. Relief in the form of declaratory relief is necessary to adjudicate the rights to the product and selling of the product(s) in question. Incubation is located in California. The original contract arose in California. The products are from California. Therefore, claims concerning those products relate to California, so the claims against ISAGENIX relate to California. B. The Exercise of Jurisdiction Over Isagenix is Reasonable “Once it has been decided that a defendant has purposefully established minimum contacts within the forum State, these contacts may be considered in light of other factors to determine whether the assertion of personal jurisdiction would comport with “fair play and substantial justice”. Burger King Corp., 471 U.S. at 476, quoting International Shoe v. Washington, 326 U.S. 310, 320 (1945). Under this “reasonableness” prong, defendants have the burden to prove, by compelling evidence, it is unreasonable for the Court to assert personal jurisdiction. Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122, 1132 (9th Cir. 2003); Integral Development Corp., 99 Cal.App.4th at 591 (“Once a plaintiff has shown the requisite minimum contacts to support jurisdiction, the burden shifts to defendant to show 6MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 10 of 49 Page ID #:1240 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 jurisdiction is not reasonable.”). The reasonableness determination turns on a balancing test based on a multiple of factors, none of which is dispositive on itself. Roth v. Garcia Marquez, 942 F.2d 617, 623 (9th Cir. 1991). The factors to be considered include: (1) the extent of the defendants’ purposeful interjection into the forum state’s affairs; (2) the burden on the defendant of defending in the forum; (3) the extent of conflict with the sovereignty of the defendants’ state: (4) the forum state’s interest in adjudicating the dispute; (5) the most efficient judicial resolution of the controversy; (6) the importance of the forum to the plaintiff’s interest in convenient and effective relief; and (7) the existence of an alternative forum. Core-Vent Corp. v. Nobel Industries AB, 11 F.3d 1482, 1487-1488 (9th Cir. 1993), quoting Paccar Int’l, Inc. v. Commercial Bank of Kuwait, 757 F.2d 1058, 1065 (9th Cir. 1985). 1. Extent of Isagenix’ Purposeful Interjection in California’s Affairs ISAGENIX’s purposeful contacts within California are closely related to the claims of the case. Dr. Wheeler, through ISAGENIX, has introduced a competitive product on the market to interfere with MPI’s contractual relations (that arose in California). Similar issues are currently being litigated in Ventura, California. Isagenix holds its trade shows in California. ISAGENIX authorizes independent agents to sell its products in California to California residents and ISAGENIX independent agents reside in California. This factor thus weighs heavily in favor of a finding of personal jurisdiction over the Defendant. 2. Burden on Isagenix of Defending in California Under California law, the burden on the foreign defendant is not a significant factor for the reasonableness analysis. “The fairness requirement of International Shoe, written over 50 years ago, must be assessed in the context of our age of global business and modern technology.” Integral Development Corp., supra 99 Cal.App.4th at 592. “[I]n this era of fax machines and discount air travel, requiring [a foreign defendant] to litigate in California is not constitutionally unreasonable.” Id. quoting Panavision 7MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 11 of 49 Page ID #:1241 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Intern., L.P. v. Toeppen, 141 F.3d 1316, 1323 (9th Cir. 1998). ISAGENIX is currently defending and counter-claiming in a lawsuit in Ventura County and have retained Snell and Wilmer located in Irvine, California. ISAGENIX’s counsel waived service of summons. Thus, this factor does not render it unreasonable for California to exercise personal jurisdiction over ISAGENIX. 3. Extent of Conflict With Sovereignty of Defendant’s State There is no evidence that there is any conflict with Arizona, ISAGENIX’s home state. This this factor is largely neutral to the issue of reasonableness. 4. California’s Interest in Adjudicating the Dispute California has a substantial interest in adjudicating this dispute. Furthermore, the forum state has a compelling interest to protect its citizen’s intellectual property. Intergral Development Corp., supra 99 Cal.App.4th at 592. (The enactment of the Uniform Trade Secrets Act in California indicates a strong legislative intent to protect California.) 5. Most Efficient Judicial Resolution of Controversy The case is properly and currently set before this Court. All other parties are litigating in California. Similar claims are currently being litigated by the same parties in the State Court in Ventura County, California (within the Central District). California is, thus, the most appropriate forum within which to adjudicate these claims. Thus, this factor tips in favor of this Court exercising jurisdiction over ISAGENIX. 6. Importance of the Forum to MPI’s Interest in Convenient and Effective Relief MPI chooses California as the forum for the purpose of obtaining convenient and effective relief. Litigating in Arizona would greatly inconvenience MPI. The case against the other parties are proceeding before the Central District of California. It will be convenient to present all witnesses and evidence in one jurisdiction before one court. This factor thus does not support a finding of unreasonableness for California to exercise personal jurisdiction over ISAGENIX. 8MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 12 of 49 Page ID #:1242 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7. Existence of an Alternative Forum Assuming arguendo that alternative forums are available, this is but one factor of seven that the Court should consider. This factor alone can never render it unreasonable for the forum state to exercise personal jurisdiction. See Gates Learjet Corp., 743 F.2d at 1333-1334 (court exercised jurisdiction over defendant, despite Plaintiff’s failure to prove the unavailability of an alternative forum, holding that “[i]n light of the other factors, however, this factor is not dispositive.”) Therefore, there is no evidence that California’s exercise of personal jurisdiction over ISAGENIX is in any way unreasonable. ISAGENIX has failed to sustain its burden of proof on this issue. C. The Central District of California Is The Proper Venue To Litigate This Claim An action may be transferred to another District “[f]or the convenience of parties and witnesses, in the interest of justice.” 28 U.S.C. §1404(a). As demonstrated above in the context of discussing the reasonableness of exercising personal jurisdiction, the convenience of the parties and witnesses is best served by litigating this case in California; so are the interests of justice. While MPI may not reside in California, the case is currently proceeding as to all the parties in the Central District of California. ISAGENIX has previously submitted to jurisdiction in California on the Ventura action which involves almost identical parties and claims. A substantial number of third-party witnesses also reside in California, as does a substantial amount of documentary evidence at issue. Thus the convenience of the parties and witnesses, and the interest of justice are all best served by litigating the case before this Court. D. In The Alternative, Limited Discovery Should Be Allowed For Determining Jurisdiction The Ninth Circuit has held that on a motion to dismiss, the Court has discretion to permit limited jurisdictional discovery without a full prima facie showing of personal jurisdiction by the plaintiffs. eMag Solutions, LLC v. Toda Kogyo Corp., 2006 WL 9MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 13 of 49 Page ID #:1243 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3783548, *2 (N.D. Cal 2006); Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements, Ltd., 328 F.3d 1122, 1135 (9th Cir. 2003). “[D]iscovery should ordinarily be granted where pertinent facts bearing on the question of jurisdiction are controverted or where a more satisfactory showing of the facts is necessary.” Laub v. U.S. Dept. of Interior, 342 F.3d 1080, 1093 (9th Cir. 2003) (citation omitted). It is MPI’s strong belief that ISAGENIX has sufficient contacts in California so as to warrant the exercise of personal jurisdiction over it. However, if this Court to consider a transfer of Court, MPI respectfully requests that it be afforded an opportunity to perform jurisdicational discovery to further establish the status and contacts of ISAGENIX. E. STANDARD OF REVIEW FOR REVIEWING A COMPLAINT IS A SUFFICIENT SHORT AND PLAIN STATEMENT UNDER FRCP §8 Federal Rule of Civil Procedure §8(a) states: A pleading which sets forth a claim for relief, whether an original claim, counterclaim, cross-claim, or third-party claim, shall contain (1) a short and plain statement of the grounds upon which the court’s jurisdiction depends, unless the court already had jurisdiction and the claim needs no new grounds of jurisdiction to support it, (2) a short and plain statement of the claim showing that the pleader is entitled to relief, and (3) a demand for judgment for the relief the pleader seeks. Relief in the alternative or of several different types may be demanded. The Ninth Circuit Federal Courts have interpreted Fed. R. Civ. P. §8(a)(2) as follows: “A pleading must contain a short, plain statement of the claim showing the pleader is entitled to relief and sufficient to put defendants fairly on notice of the claims against them.” (Sparling v. Hoffman Constr. Co. (9th Cir. 1998) 864 F.2d 635, 640.) A complaint should set forth sufficient information to outline the elements of the claim. (See, e.g., Balistreri v. Pacifica Police Dept. (9 Cir. 1990) 901 F.2d 696, 699;th General Star Indemn. Co. v. Vesta Fire Ins. Corp. (5th Cir. 1999) 173 F.3d. 946, 950.) In considering a motion to dismiss pursuant to Rule §12(b)(6), the court must 10MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 14 of 49 Page ID #:1244 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 accept all the factual allegations of a plaintiff’s complaint as true. (Neitzke v.Williams (1989) 490 U.S. 319, 326.) The court is bound to give the non-moving party the benefit of every reasonable inference to be drawn from the attacked pleading. (Hospital Building Co. v. Trustees of Rex College (1976) 425 U.S. 738, 746.) The test for sufficiency is a broad one, i.e., whether a plaintiff may recover under any reasonably conceivable set of circumstances susceptible of proof under the complaint. If the mere possibility exists that a plaintiff may recover, the motion to dismiss must be denied. (Conley v. Gibson (1957) 355 U.S. 41, 46.) The Federal Rules of Civil Procedure do not require a plaintiff to set out in detail the facts upon which it bases a claim. Rather, “all the Rules require is a short and plain statement of the claim that will give the defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests.” (Conley, 355 U.S. at 47.) Accordingly, a district court “can dismiss [a] claim only if, assuming all facts alleged to be true, plaintiff still fails to plead the basic elements of a cause of action.” (Corcoran v. N.Y. Power Authority 935 F. Supp. 376, 382 (S.D.N.Y. 1996); c.f. U.S. v. Employing Plasterers Ass'n of Chicago (1954) 347 U.S. 186, 189 (“where a bona fide complaint is filed that charges every element necessary to recover . . . summary dismissal. . . can seldom be justified”). Federal Rule of Civil Procedure §9(b) states, “[i]n all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent, knowledge, and other condition of mind of a person may be averred generally.” In the alternative, if the Court determines that Plaintiffs’ complaint does not comply with the above-stated pleading requirements, Plaintiffs request leave to amend the complaint. F. EACH CAUSE OF ACTION IN COMPLAINT IS SUFFICIENTLY PLED MPI indicated in the Complaint that the claims it is seeking against ISAGENIX are 1) Intentional Interference with Contractual Relations and 2) Declaratory Relief. Therefore, MPI will address the instant motion only as to the claims it has brought 11MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 15 of 49 Page ID #:1245 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 against ISAGENIX. 1. Intentional Interference with Contractual Relations is Properly Pled Despite ISAGENIX’s characterization that “there is no allegation that Isagenix actually knew of the contract between Media Power and Incubation” (MTD 13:27-28), MPI clearly alleges: “At all relevant times, Counter/Cross/Third Party-Defendants have been aware of MPI’s commercial relationship with INCUBATION.” (Complaint ¶.17). Further, MPI has alleged actual interference by ISAGENIX. “Among other things, each of the Counter/Cross/Third Party-Defendants have made, or assisted and encouraged the making, of verbal and written communications by PEAK and their authorized agents, to MPI. In the verbal and written communications, MPI was told, among other things, that INCUBATION had engaged in questionable and unethical conduct and other seriously improper conduct”. (Complaint 13:9-14). In addition, MPI clearly indicates: “The conduct of Counter/Cross/Third Party Defendants has in fact interfered in, disrupted and damaged MPI’s relationship with INCUBATION.” (Complaint ¶.19). MPI states that ISAGENIX’s conduct was the proximate cause of its damage and alleges it has suffered damage. See ¶.¶.21 and 22 of the Complaint. If the Court finds such an allegation of actual interference is insufficient, and allegations regarding damages are insufficient, MPI respectfully requests that it may amend its Complaint to set forth such facts. 2. Declaratory Relief is Properly Pled Although the Agreement alleged is between MPI and Incubation, ISAGENIX and Wheeler are involved in the Agreement and have interfered with such Agreement. “A competitive product has been introduced into the market by Dr. Wheeler...and Dr. Wheeler acted in concert with Isagenix in a scheme and plot to hijack sales and revenue of GSP.” (Complaint ¶.13). If the Court finds the allegations of declaratory relief are insufficiently pled, MPI respectfully requests that it may amend its Complaint to set forth such facts. 12MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 16 of 49 Page ID #:1246 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 G. IN THE EVENT THE MOTION TO DISMISS IS SUSTAINED, LIBERAL POLICY FAVORS GRANTING LEAVE TO AMEND COMPLAINT Even if this motion to dismiss is granted, leave to amend the complaint is routinely granted. Federal Rule of Civil Procedure §15(a) expressly states that leave to amend “shall be freely given when justice so requires.” (Friedlander v. Nims (11th Cir. 1985) 755 F.2d 810, 813.) Where a more carefully drafted complaint might state a claim, a plaintiff must be given at least one more chance to amend the complaint before the district court dismisses the action with prejudice. (Silva v. Bieluch (11th Cir. 2003) 351 F.3d 1045, 1048; DeCarlo v. Fry (2nd Cir. 1998) 141 F.3d 56, 62.). Therefore, if the Court is inclined to grant ISAGENIX’s motion, then MPI respectfully requests that it be granted leave to amend its Complaint to cure deficiencies, is any. III. CONCLUSION For the foregoing reasons, this Court should deny Defendant’s Motion to Dismiss as well as deny the requested change of venue. Alternatively, this Court should continue the hearing on the Motion to Dismiss in order to allow MPI to conduct jurisdictional discovery. Lastly, if the Court finds the Complaint deficient with regard to the claims against ISAGENIX, the Court should allow MPI to amend its Complaint. Dated: August 9, 2010 LAW OFFICES OF CARLOS F. NEGRETE ____/s/ Carlos F.Negrete_________ CARLOS F. NEGRETE Attorneys for Defendant/Counter- Claimant/Third- Party Plaintiff MEDIAPOWER, INC. 13MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 17 of 49 Page ID #:1247 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 (PROOF OF SERVICE - 1013a, (3) 2015.5 C.C.P.) STATE OF CALIFORNIA ] ss. COUNTY OF ORANGE ] I am employed in the County of Orange, State of California. I am over the age of 18 and not a party to the within action and my business address is 27422 Calle Arroyo, San Juan Capistrano, California 92675. On August 9, 2010, I served the foregoing document(s) described as: SEE ATTACHED DOCUMENT LIST on the interested parties in this action by submitting a true and correct copy of the above described documents as follows [X] (BY MAIL) I deposited the document by regular mail. I am readily familiar with this office’s practice of collection and processing correspondence for mailing. Under that practice it would be deposited, trough the office’s office complex postal delivery box, with the U.S. Postal Service on the same day in a sealed envelope with postage thereon fully prepaid at San Juan Capistrano, California, in the ordinary course of business to the parties listed below. I am aware that on motion of the party served, service is presumed invalid if the postal cancellation date or postage meter date is more than one day after date of deposit from mailing in this declaration. [ ] (BY U.S. POSTAL SERVICE EXPRESS MAIL) I deposited in a post office, mailbox, sub-post office, substation,mail chute or other like facility regularly maintained by the United States Postal Service for receipt of Express Mail a copy of the above-described documents, in a sealed envelope, with Express Mail postage fully prepaid and addressed to the parties listed below. [ ] (BY FACSIMILE) I caused all of the pages of the above-entitled document to be sent to the parties listed below,pursuant to California Rules of Court, Rule 2008 and California Code of Civil Procedure, Section 1013. The facsimile machine that I used complied with Rule 2003 and no error was reported by the machine. I caused the machine to print a transmission confirmation record of the transmission, a copy of which is attached hereto and made a part hereof as though set forth in full herein. The date, time, telephone number of the party served and final status of the transmission are set forth in the confirmation record. [ ] (BY E-MAIL) I caused a copy of below listed documents to be delivered to the parties/counsel set forth below by means of electronic mail to the addresses listed below. [ ] (BY ELECTRONIC SERVICE) I caused a copy of the below listed documents to be delivered by Electronic Service of Appellate Briefs pursuant to California Rules of Court, Rule 8.212(c)(2) applicable to service upon the California Supreme Court. [X] (BY CM/ECF SYSTEM) I certify that the above listed document(s) was/were served pursuant to the district court’s CM/ECF system as to ECF filers. [ ] (PERSONAL SERVICE) I caused a copy of the above listed document to be personally delivered to the party set forth below at the address set forth below. SEE ATTACHED SERVICE LIST Executed on August 9, 2010, at San Juan Capistrano, California. I declare under penalty of perjury under the laws of the State of California and the United States of America that the above is true and correct. S/Carlos F. Negrete Carlos F. Negrete 14MEDIAPOWER’S OPPOSITION TO ISAGENIX’S MOTION TO DISMISS OR TRANSFER COMPLAINT Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 18 of 49 Page ID #:1248 DOCUMENT LIST 1. MEDIAPOWER, INC.’S OPPOSITION TO ISAGENIX’S MOTION FOR ODER TO DISMISS COMPLAINT FOR LACK OF PERSONAL JURISDICTION, OR TO TRANSFER ACTION TO DISTRICT OF ARIZONA PURSUANT TO 28 U.S.C. 1406(a) OR 1404(a), OR TO DISMISS FOR FAILURE TO STATE A CLAIM; DECLARATION OF CARLOS F. NEGRETE IN SUPPORT OF MEDIAPOWER, INC.’S OPPOSITION TO ISAGENIX’S MOTION FOR ODER TO DISMISS COMPLAINT FOR LACK OF PERSONAL JURISDICTION, OR TO TRANSFER ACTION TO DISTRICT OF ARIZONA PURSUANT TO 28 U.S.C. 1406(a) OR 1404(a), OR TO DISMISS FOR FAILURE TO STATE A CLAIM SERVICE LIST BY MAIL J. James Li David J. Perez Greenberg Traurig, LLP 1900 University Ave., 5 Floorth East Palo Alto, CA 94303 Tel. (650) 328-8500 Fax. (650) 328-8508 Attorneys for Plaintiffs/Cross-Defendants Peak Performance Nutrition; William Wheeler K. Andrew Kent Rincon Venture Law Group 2815 Townsgate Road, Suite 213 Westlake Village, CA 91361 Tel. (818) 557-0580 Fax. (818) 557-0480 akent@rincongoup.com Attorneys for Defendant Ken Wright; and Third-Party Defendant Incubation LLC Elizabeth M. Weldon Joshua A. Allison Snell & Wilmer, LLP 600 Anton Blvd., Suite 1400 Costa Mesa, CA 92626 eweldon@swlaw.com Andrew F. Halaby, Esq. Sean J. O’Hara, Esq. SNELL & WILMER LLP One Arizona Center 400 East Van Buren St. Phoenix, AZ 85004 Tel. (602) 382-6000 Fax. (602) 382-6070 ahalaby@swlaw.com sohara@swlaw.com Attorneys for Third-Party Defendant Isagenix International LLC SERVICE LIST BY CM/ECF SYSTEM Jing James Li lij@gtlaw.com David J. Perez perezdj@gtlaw.com K. Andrew Kent akent@rincongroup.com 15 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 19 of 49 Page ID #:1249 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Carlos F. Negrete, Esq. SBN # 134658 LAW OFFICES OF CARLOS F. NEGRETE 27422 Calle Arroyo San Juan Capistrano, CA 92675-2747 Telephone (949) 493-8115 Telefax (949) 493-8170 cnegrete@negretelaw.com Attorney for Defendant/Counter-Claimant/Third-Party Plaintiff MEDIAPOWER, INC. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA - SANTA ANA DIVISION PEAK PERFORMANCE NUTRITION, a Nevada Domestic Corporation, and WILLIAM E. WHEELER, Ph.D., an individual, Plaintiffs, v. MEDIAPOWER, INC., a Maine Corporation KENNETH W. BYERS, an individual, and KEN WRIGHT, an individual, Defendants. ______________________________ MEDIAPOWER, INC., a Maine Corporation, Counter-Claimant, v. PEAK PERFORMANCE NUTRITION, LTD., a Nevada Domestic Corporation, WILLIAM E. WHEELER, Ph.D., and ROES 1 through 25, inclusive. Counter-Defendants. ______________________________ MEDIAPOWER, INC., a Maine Corporation, Third Party Plaintiff, v. ISAGENIX INTERNATIONAL, LLC, INCUBATION LLC and ZOES 1 through 25 inclusive. Third-Party Defendants. ______________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No.: CV09-4933 AG (Shx) Case Assigned To: Hon. Judge Andrew Guilford Courtroom: 10D DECLARATION OF CARLOS F. NEGRETE IN SUPPORT OF MEDIAPOWER, INC.’S OPPOSITION TO ISAGENIX’S MOTION FOR ODER TO DISMISS COMPLAINT FOR LACK OF PERSONAL JURISDICTION, OR TO TRANSFER ACTION TO DISTRICT OF ARIZONA PURSUANT TO 28 U.S.C. 1406(a) OR 1404(a), OR TO DISMISS FOR FAILURE TO STATE A CLAIM 1DECLARATION OF CARLOS F. NEGRETE Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 20 of 49 Page ID #:1250 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DECLARATION OF CARLOS F. NEGRETE I, CARLOS F. NEGRETE, declare as follows: 1. I am an attorney at law duly licensed by the State of California to practice before this Court. I make this declaration of my own personal knowledge and if called upon to testify, I would and could testify competently to the following: 2. I am the attorney for Defendant/Counter-Claimant/Third-Party Complainant MediaPower, Inc. in the above referenced matter. 3. Attached hereto as Exhibit A is a true and correct copy of a letter from Elizabeth M. Weldon to Carlos F. Negrete dated July 19, 2010. 4. Attached hereto as Exhibit B is a true and correct copy of a letter from Lyndsey A. Tadlock to Carlos F. Negrete dated July 23, 2010. 5. Attached hereto as Exhibit C is a true and correct copy of a letter from Carlos F. Negrete to Lindsey Tadlock dated July 26, 2010. 6. Attached hereto as Exhibit D is a true and correct copy of a letter from Lyndsey A. Tadlock to Carlos F. Negrete dated July 27, 2010. 7. Attached hereto as Exhibit E is a true and correct copy of Isagenix International, LLC’s Cross-Complaint in the Ventura state action Case No. 56-2008- 00319337-CU-BC-VTA. 8. Attached hereto as Exhibit F is a true and correct copy of the Waiver of Service of Summons executed by Elizabeth M. Weldon on June 11, 2010. 9. I spoke with counsel for ISAGENIX, Ms. Tadlock on July 23, 2010. I proposed that if Ms. Tadlock pointed out any deficiencies that MediaPower would further discuss these grounds and, if well taken, would amend its Complaint to cure any deficiencies. Ms. Tadlock was unwilling to cooperate with this request nor was she willing to discuss any deficiencies of the Complaint. I indicated to Ms. Tadlock that I was willing to discuss stipulating to extension of time for ISAGENIX to file a response to the Complaint and/or consider the filing of an amended Complaint rather than burden the Court with the instant motion and use its valuable time. Indeed, I made if very clear 2DECLARATION OF CARLOS F. NEGRETE Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 21 of 49 Page ID #:1251 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 that it seemed preferable to attempt to resolve the issues to eliminate the necessisty of a hearing. Instead, to my dismasy, the motion was filed without further discussion and apparent lack of good faith by counsel for ISAGENIX to resolve the issues before filing the instant motion as required by Local Rule 7-3. 10. As the Court will note in the brief that MPI has submitted, the jurisdictional arguments are completely without merit and seemingly made in bad faith. There can be no question that Isagenix has substantial contacts in California. Thus, the Motion is an attempt to delay this case. 11. As part of MPI’s response to the Motion to Dismiss, I conducted an investigation as to ISAGENIX contacts in California. During the course of this investigation it was discovered that: 1) ISAGENIX advertises and sells its products in California; 2) ISAGENIX authorizes independent agents to sell ISAGENIX products throughout the world, including California, while many agents also live in California; 3) ISAGENIX holds it annual trade show/celebration in California, with thousands of people attending; 4) ISAGENIX has previously submitted to the jurisdiction of California as a defendant and Cross-Complainant in the action Case No. 56-2008- 00319337-CU-BC-VTA in the Superior Court of the State of California, County of Ventura, complaint filed on May 23, 2008, with ISAGENIX appearing as a Cross- Complainant and as a Cross-Defendant on December 10, 2009, filing its Cross- Complaint and also answering the Amended Cross-Complaint by Incubation LLC and Nature’s Pure Body Institute, Inc. On this basis alone, ISAGENIX’s motion is clearly without merit, frivolous and brought in bad faith. 12. In addition to the jurisdictional information set forth above at paragraph 11, I performed an internet Google search and discovered that ISAGENIX INTERNATIONAL LLC has planned its ‘Celebration 2010" in San Diego, California from August 21-24. http://www.isagenixcelebration.com/, http://www.isaconvention.com/. The San Diego Convention Center website lists the 3DECLARATION OF CARLOS F. NEGRETE Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 22 of 49 Page ID #:1252 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 event as a “Convention with Trade Show” indicating 6,000 attendees. There is also the1 Isagenix Celebration planned for next year, August 14-August 16, 2011, with 8,000 attendees. Further, ISAGENIX offers podcasts of business training online. One such podcast was recorded on June 20, 2009, where ISAGENIX trainer, and Senior Vice President and Chief Training Officer David Wood held a business training event in anticipation of the “Living the Dream” event in Anaheim, California on August 8-10, 2009. (http://www.isagenixpodcast.com/2009/06/). Further, ISAGENIX authorizes Independent Agents throughout the world, including California, to sell its products to consumers. For example, independent agents reside in Glendale, Escondido, San Diego, and San Francisco to sell conveniently to California residents and to recruit2 other Independent Agents who reside in California. Such products include those that are alleged by MPI to compete directly with the Gold Standard Protein (“GSP”) product that MPI purchased from Incubation. 13. At the very least, based on the above information, MPI should be allowed to perform jurisdictional discovery prior to the Court ruling on the Motion to establish the extent of ISAGENIX’s contacts in this jurisdiction and such is respectfully requested of this Court. I declare under penalty of perjury that the foregoing is true and correct under the laws of the State of California and the United States of America, and that this declaration was executed in San Juan Capistrano, California on this 9th day of August, 2010. _______/s/ Carlos F. Negrete________ Carlos F. Negrete http://www.sdccc.org/eventscalendar/searchdate.cfm?startMonth=8&startMonthDay=8&startY1 ear=2010&endMonth=8&endMonthDay=25&endYear=2010 Google “Isagenix Independent Agent California”2 4DECLARATION OF CARLOS F. NEGRETE Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 23 of 49 Page ID #:1253 5 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 24 of 49 Page ID #:1254 6 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 25 of 49 Page ID #:1255 7 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 26 of 49 Page ID #:1256 8 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 27 of 49 Page ID #:1257 9 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 28 of 49 Page ID #:1258 10 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 29 of 49 Page ID #:1259 11 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 30 of 49 Page ID #:1260 12 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 31 of 49 Page ID #:1261 13 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 32 of 49 Page ID #:1262 14 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 33 of 49 Page ID #:1263 15 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 34 of 49 Page ID #:1264 16 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 35 of 49 Page ID #:1265 17 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 36 of 49 Page ID #:1266 18 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 37 of 49 Page ID #:1267 19 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 38 of 49 Page ID #:1268 20 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 39 of 49 Page ID #:1269 21 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 40 of 49 Page ID #:1270 22 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 41 of 49 Page ID #:1271 23 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 42 of 49 Page ID #:1272 24 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 43 of 49 Page ID #:1273 25 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 44 of 49 Page ID #:1274 26 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 45 of 49 Page ID #:1275 27 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 46 of 49 Page ID #:1276 28 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 47 of 49 Page ID #:1277 29 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 48 of 49 Page ID #:1278 30 Case 2:09-cv-04933-AG -SH Document 94 Filed 08/09/10 Page 49 of 49 Page ID #:1279