Nerium International permitted to sell third-party products
Nerium Skincare’s lawsuit against Nerium International dates back to 2016.
Based on an agreement, Nerium International is supposed to only market and sell products developed by Nerium Skincare.
In their lawsuit, Nerium Skincare allege Nerium International stopped honoring the agreement in 2014.
Tracking the case has proven difficult, mostly due to the majority of filings being made under seal.
To also give you some idea of the scope of the case, it’s at 496 filings as of May 25th, 2018.
Earlier on in the case the court appointed a Special Master to make reports and recommendations on filed motions.
Through these unsealed orders (which are difficult to track because the docket contains no information about what an order is being made on), we get glimpses into the progress of the case.
One such Special Master order was made on March 26th, pertaining to Nerium Skincare’s and Nerium International’s respective Motions for Summary Judgment.
Having dissected the agreement between Nerium Skincare and Nerium International, the Special Master concluded that
Nerium Skincare may be disappointed that Nerium International enjoys the benefits of serving as the sole and exclusive worldwide distributor of NSC products with no corresponding obligation on the part of Nerium International to sell only those products.
But that is what the Agreement provides.
Nerium International and Jeff Olson are entitled to summary judgment on this claim.
Requested Summary Judgment by Nerium International also saw a the claim Nerium International ‘failed to user their “best efforts” to promote the sale of Nerium Skincare products‘ ruled in favor of Nerium International.
Nerium Skincare’s Summary Judgment request for attorney’s fees was also denied.
With respect to a counterclaim filed by Nerium International, pertaining to Nerium Skincare overcharging the company for its products, Nerium Skincare’s Motion for Summary Judgment in their favor was denied (ie. Nerium International’s claim still stands).
Nerium International as a business also survived a Summary Judgment decision on whether it should be wound up and terminated, after the Special Master ruled ‘such relief is not proper by way of summary judgment‘.
The Special Master noted Nerium International is still at risk if Nerium Skincare prevails at trial.
Nerium Skincare’s RICO allegations against Jeff Olson didn’t survive. However Olson failed to also have Nerium Skincare’s allegations of fraud and breach of fiduciary duty dismissed.
On May 2nd the court adopted the Special Master’s report and recommendations regarding summary judgment filings.
In a communication shared with its affiliates shortly thereafter, Nerium International celebrated the order as “good news”.
Just last week, the Court entered summary judgment in favor of Nerium International on a number of legal issues including the most important legal issue in the case.
The main legal issue in the lawsuit up to this point has been NBI’s claim that Nerium International can only sell products that NBI produces.
NBI is Nerium Biotechnology Inc., the parent company of Nerium Skincare.
In other words, NBI wanted the Court to prohibit Nerium International from selling AgeIQ, EHT, Prolistic, etc.
Instead, the Court entered summary judgment confirming Nerium’s ability to sell whatever products it wants.
This ruling is a devastating blow to NBI’s lawsuit and severely reduces the claims left for trial.
The only issues remaining for trial are “check book” type claims by NBI and Nerium’s claim against NBI for breaching the exclusivity agreement.
As of May 25th unresolved claims in the case are continuing toward trial.