Shire LLC v. Mickle
7:10-cv-00434
W.D. Va.Feb 11, 2011Background
- Shire LLC sued KemPharm, Inc. and Mickle in a diversity action for breach of contract and tortious interference.
- KemPharm moves to dismiss the tortious interference claim for lack of personal jurisdiction under Rule 12(b)(2) and improper venue under Rule 12(b)(3); alternatively, it seeks transfer under § 1404(a).
- Diversity jurisdiction is in dispute because Shire’s LLC citizenship depends on its members, which are not disclosed in the record.
- Mickle previously worked for NRP (New River Pharmaceuticals) and entered into employment, settlement, and patent-assignment agreements while at NRP; Shire later acquired NRP’s assets.
- KemPharm established in Iowa; has Virginia activity (research facility, Virginia residents, and Virginia-based contracts) alleged to use Shire/Mickle confidential information.
- Virginia is the location where the alleged tortious conduct occurred and where essential witnesses/proofs lie; a forum-selection clause designates the Western District of Virginia for disputes.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether KemPharm is subject to specific jurisdiction in Virginia | Shire asserts purposeful Virginia conduct via VA-based activities and personnel. | KemPharm contends insufficient or unrelated contacts to Virginia for this claim. | Yes; court finds specific jurisdiction over KemPharm. |
| Whether venue is proper in the Western District of Virginia | A substantial portion of events occurred in Virginia, including Virginia-based activities and witnesses. | Venue should be in a different locus per defendant's view. | Yes; venue is proper in WD Va. |
| Whether the case should be transferred to the Southern District of Iowa | Shire argues continuing in Virginia is appropriate; transfer not warranted. | KemPharm/Mickle seek transfer for convenience. | No; court denies transfer. |
| Whether complete diversity exists for subject-matter jurisdiction | Shire argues diversity exists given parties and controversy amount. | Lack of disclosed members of Shire’s LLC prevents complete diversity. | Diversity not conclusively established; dismissal possible if members aren’t disclosed. |
Key Cases Cited
- Int’l Shoe Co. v. Washington, 326 F.2d 495 (1945) (minimum contacts for specific jurisdiction)
- Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (1984) (specific jurisdiction requires related contacts)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (purposeful availment and reasonableness factors)
- Consulting Eng’rs Corp. v. Geometric Ltd., 561 F.3d 273 (4th Cir. 2009) (merges long-arm statute with constitutional inquiry)
- ALS Scan, Inc. v. Digital Serv. Consultants, Inc., 293 F.3d 707 (4th Cir. 2002) (three-part test for specific jurisdiction)
- Gen. Tech. Applications, Inc. v. Exro Ltda, 388 F.3d 114 (4th Cir. 2004) (diversity and corporate citizenship of LLCs)
- Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22 (1988) (forum transfer considerations and forum selection importance)
- Century-21 v. Elder, 239 Va. 637 (1990) (elements of tortious interference in Virginia)
- United States v. Douglas, 626 F. Supp. 621 (E.D. Va. 1985) (presumption in favor of plaintiff's venue choice)