FFBM counterclaims dismissed, files for bankruptcy
First Fruits Business Ministry has had all counterclaims filed against Vietal Nutrition dismissed.
The next day FFBM informed the court it had filed for bankruptcy.
Vietal Nutrition’s Motion to Dismiss FFBM’s counterclaim against it was scheduled to be heard on October 3rd.
On September 29th the court noted a tentative ruling on the matter had been published, vacating the hearing.
Vietal Nutrition filed a motion requesting another hearing on the counterclaim dismissal October 4th.
On October 6th the court dismissed Vietal Nutrition’s motion, stating;
The Court finds that oral argument would not be helpful in this matter.
For the following reasons, the Motion is GRANTED. The Court DISMISSES all counterclaims without prejudice.
Like everything in this ongoing saga, the reasoning for the dismissal is messy.
Citing a two-year statute of limitations on FFBM’s claims, the court wrote;
Here, it is not obvious from the face of the First Amended Counterclaim that First Fruit pleads itself out of court.
However, the Court does find that First Fruits’ allegations fail under Rule 8’s pleading standards.
First Fruits alleges that its prospective business partners would not do business with First Fruits “as of the current date” for fear of being “dragged into litigation by Tripharma.”
It also alleges that the interference “continues to the current day.”
But later, it vaguely alleges that Tripharma interfered with a “pending contract with AIDP2 as of May 2018” and “other companies since that time.”
First Fruit does not identify who these other companies are. Because First Fruit references multiple dates, that is, “current date” and “May 2018,” it is ambiguous as whether First Fruits bases its counterclaims solely on events arising from May 2018 (in which case, First Fruits’ counterclaim would be time-barred) or on other, unrelated events arising between 2018 and 2022.
First Fruit also fails to identify which contracts, business relations, business partners were involved, and when these interferences took place.
These allegations fail under Rule 8’s pleading standards, and that alone is sufficient to grant dismissal of these claims.
In a nutshell, FFBM needs to identify instances of alleged harm/interference by Vietal Nutrition within the last two years (the cited 2018 example falls outside this period).
To that end, the court continued;
In its briefing, First Fruit argues that there are recently discovered facts that occurred in or about August and September 2022 and accompanying counterclaims that arise from these new facts.
These additional facts are allegedly “different and distinct” from the prior lawsuits, and they would refute Tripharma’s argument that first four counterclaims are time-barred.
In its reply, Tripharma argues that these allege newly discovered facts will not save the counterclaims because they were discovered after the counterclaims are filed and are based on the expired ’892 Patent, which expired in May 2022.
If First Fruits wishes to pursue these claims and add these allegations, it may do so in an amended pleading.
The Court DISMISSES First Fruits’ first four claims without prejudice.
FFBM’s fifth and sixth counterclaims were dismissed because
the allegations giving rise to First Fruits’ fifth and sixth counterclaims are so vague and conclusory that they fail to give rise to plausible claims against Tripharma.
So the pressing question is whether FFBM will file an amended counterclaim, with updated instances of alleged interference and/or harm.
That brings us to FFBM informing the court it has filed for Chapter 11 bankruptcy.
As per FFBM’s October 7th filing, the company
reports assets of $50M-$100M and liabilities of $1M-$10M.
The (bankruptcy) petition states funds will be available to unsecured creditors.
And keep in mind this is on top of Vietal Nutrition securing the appointment of a FFBM Receiver in September.
As it stands Vietal Nutrition and FFBM, in its current state, are scheduled to face off at trial on the patent issue next March.
Hanging in the balance is Awakend, whose Zenith weight loss supplement is formulated on the disputed patent.
I’m not following FFBM’s bankruptcy proceedings but will be keeping an eye on the patent docket for updates. Stay tuned…
Update 31st October 2022 – FFBM filed a second amended counterclaim on October 26th.