Complaints Categories

Sioux Pharm Inc. - Sioux Center, Iowa Complaints - Sioux Pharm, Inc. False Claims of Chondroitin Sulfate Purity

To The Honorable Judge of
the Lisbon District Court

SUMMIT NUTRITIONAL INTERNATIONAL
INC., branch in Portugal, Juristic Person
Number 980413672, with its domicile in
Lisbon, at Empreendimento Nova
Amoreiras – Palácio- 3ºpiso, secção 9, Rua
Artilharia 1, 71-77, 1250-038 Lisboa,
Portugal

Hereby commences non-typified interlocutory
injunction proceedings against,

SIOUX PHARM INC., an American company
with its registered office in 121 19th Street SW
Sioux Center, IA 51250, Iowa, United States of America

in the following terms and on the following
grounds,

1

The Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., is a
commercial company, with its registered office in New Jersey, USA, which, via
its branch in Portugal, is in the business of the commercialization in the
European Union of chondroitine sulphate with the brand name DROI-KON,
which it imports from the USA.

2

The product commercialized by the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., is food grade chondroitine sulphate, which is subject to
a purity requirement that it must contain not less than 90% of chondroitine
sulphate. There is also pharmaceutical grade chondroitine sulphate on the
market, which must not only have the same minimum chondroitine sulphate
content, but is also required to comply with certain requirements of the USP
(USA Pharmacopeia). As clarified in the information attached as document no.1.
which contents are incorporated by this reference.

3

The Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., habitually
acquires the product it commercializes from the manufacturer EAGLE
LABORATORIES INC., whose plant is located in the State of IOWA in the USA.

4

The Respondent, SIOUX PHARM INC., is a commercial company with its
registered office in the said state of IOWA, which is in the business of the
manufacture and commercialization of pharmaceutical grade chondroitine
sulphate under the CHONDROPURE brand name, among other products.

5

Food grade chondroitine sulphate is commercialized in Europe at a price
between twenty and thirty euro/kilo, while the price of the pharmaceutical grade
product is more than one hundred euro/kilo.

6

The product commercialized by the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., is submitted by it for analysis by laboratories accredited
by the FDA - Food and Drug Administration in the USA, and these analyses
have always shown the existence of at least 90% of chondroitine sulphate in the
samples, i.e., the product’s required purity level. Certificate of analysis, and
reports of 5 analysis referred in this certificate, are attached as document no.2
to 7, which contents are incorporated by this reference.

7

The Applicant’s clients in Europe, of which there are more than twenty, also
conduct analyses of samples of the product supplied by the Applicant SUMMIT
NUTRITIONALS INTERNATIONAL INC., at laboratories selected by them. As at
the date hereof, none of the said clients have complained regarding the purity of
the product and they have always expressed their total satisfaction with the
quality of the product supplied by the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC.

8

It is important to highlight that the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., acquired from the extremely demanding “Better
Business Bureau Serving New Jersey”, the accreditation as a company that
uses business practices according to ethics in advertisement, in sales and in
commercial relationships with clients, as displayed in the certificate attached as
document no.8, which contents are incorporated by this reference.

9

It is noteworthy that the methods of analysis appropriate to the analysis of the
food grade product differ from those appropriate to the analysis of the
pharmaceutical grade product. Furthermore, if analysis methods appropriate to
the analysis of the pharmaceutical grade product are used to analyze the food
grade product, the results obtained can show a purity level which is less than
the required level.

10

In an industrial and commercial dispute with the Applicant's said supplier, the
Respondent, SIOUX PHARM INC., commenced legal proceedings in IOWA in
which it complains of acts of industrial espionage and of the adulteration of
chondroitine sulphate by EAGLE LABORATORIES INC., via the addition of
maltodextrin.

11

The Respondent, SIOUX PHARM INC., also claims in the said legal
proceedings that the Applicant, SUMMIT NUTRITIONALS INTERNATIONAL
INC., and another company, which is also a client of Eagle Laboratories,
together with latter have diluted chondroitine sulphate with maltodextrin. This
claim is manifestly untrue as the Respondent, SIOUX PHARM INC., is well
aware that the Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., is
not a manufacturer and that it merely commercializes the product it acquires
from manufacturers.

12

The Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., has no
reason to believe that its supplier EAGLE LABORATORIES INC. adulterates
the product, but can assert that even if its said supplier is guilty of the said
conduct, there is no adulteration of the product supplied to the Applicant,
SUMMIT NUTRITIONALS INTERNATIONAL INC., as is clear from the analyses
systematically carried out by both the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., and its clients.

13

On the false assumption that the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., commercialized an adulterated product and that it has
contributed to the said adulteration, the Respondent, SIOUX PHARM INC.,
accuses the Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., of
unfair competition and seeks that damages be awarded against the Applicant,
SUMMIT NUTRITIONALS INTERNATIONAL INC., with regard to the loss and
damage suffered by the Respondent, SIOUX PHARM INC., which loss and
damage it neither specifies not quantifies, and that the Applicant, SUMMIT
NUTRITIONALS INTERNATIONAL INC., be freezed from diluting chondroitine
sulphate and from distributing or selling diluted chondroitine sulphate, and
further that the Applicant’s business in competition with the Respondent, SIOUX PHARM INC., be restrained or suspended at least while the proceedings are
pending, which latter claim is manifestly excessive in the light of the facts
pleaded.

14

The Respondent’s latter claim is a clear illustration of its real objective, which is
to achieve a monopoly, or quasi-monopoly, in the market for the product in
question, reduced to pharmaceutical grade, which is something that a remedy,
which is merely corollary to the facts pleaded, i.e. that the Applicant, SUMMIT
NUTRITIONALS INTERNATIONAL INC., be restrained from commercializing
the adulterated product, would not permit it to achieve.

15

Given the fact that the Respondent, SIOUX PHARM INC., also commercializes
its product in the EU, the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., has good reason to fear that the Respondent, SIOUX PHARM INC., which also has clients in this market, will seek to perturb the
activity of the Applicant’s branch in Portugal, via false statements intended to
discredit it, i.e. false descriptions of the quality of the product commercialized by
the Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., which
amounts to anti-competitive conduct that is contrary to the honest custom and
practice in any economic activity.

16

Given the great difference between the price of the product commercialized by
the Respondent, SIOUX PHARM INC., and the product commercialized by the
Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., it is easy to
comprehend the Respondent’s, SIOUX PHARM INC., interest in discrediting the
Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., or even in
eliminating companies from the market that supply a market segment with a
much lower prices, which will only have recourse to the Respondent’s, SIOUX PHARM INC., product, when the uses of the product or the requirements of the
end clients cannot at all be satisfied by the food grade product.

17

Furthermore, the Respondent’s, SIOUX PHARM INC., conduct is not limited to
this unfair competition, to which it has already had recourse in the legal
proceedings in IOWA. The Respondent’s, SIOUX PHARM INC., greed is such
that it adulterates its own product in order to increase its profits, not only by
increasing its sales through the elimination of the Applicant, SUMMIT
NUTRITIONALS INTERNATIONAL INC., from the market but also by reducing
its production costs by adulteration of the product.

18

The adulteration of the Respondent’s, SIOUX PHARM INC., product, for which
only the Respondent, SIOUX PHARM INC., can be responsible, was noted by
the Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., via an
analysis of the contents of a package clearly identified as Chondropure,
supplied by the Respondent, SIOUX PHARM INC..

19

This package was supplied by the Respondent, SIOUX PHARM INC., to a
company that is also a food grade client of the Applicant, SUMMIT
NUTRITIONALS INTERNATIONAL INC., and was made available by the said
company for analysis by the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC.

20

The analysis of the said product by an independent laboratory approved by the
FDA, showed that the product supplied by the Respondent, SIOUX PHARM INC., does not even comply with the requirements applicable to the food grade
product, as the chondroitine content of the product was only 24.90% and also
does not comply with other requirements applicable to the pharmaceutical
grade product, as result from the analysis report from the 4th March 2015, and
from the identification of the analyzed sample, which are attached as
documents no. 9 and no. 10 which contents are incorporated by reference.

21

By selling the said non-compliant product that lacks the required characteristics
and does not meet the expectations of the Respondent’s, SIOUX PHARM INC.,
clients and lacks the characteristics announced by the Respondent, SIOUX PHARM INC., it is also guilty of unfair competition on the grounds of false
description or incorrect indication of the product’s quality and use.

22

The Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., is entitled to
carry on its lawful and transparent economic activity in the European market in
fair competition with the other operators in this market and to be protected from
perturbations caused by operators that act in violation of the honest practices of
this business.

23

The Respondent’s, SIOUX PHARM INC., stigmatized conduct causes the
Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., to fear that it will
apply them in order to wrongfully interfere with and perturb its business in the
European market.

24

The Applicant’s fear is amply justified by the Respondent’s, SIOUX PHARM INC., said conduct and fully justifies the grant of appropriate interlocutory
injunctions in order to protect the Applicant’s threatened right.

25

In this case, the interlocutory injunctions sought are that the Respondent,
SIOUX PHARM INC., be restrained from making any statements likely to
discredit the Applicant, SUMMIT NUTRITIONALS INTERNATIONAL INC., and
its product and that it be further restrained from introducing chondroitine
sulphate into the European market that does not comply fully with the purity
requirement of at least 90% of this product and that, in the case of
pharmaceutical grade chondroitine sulphate, which does not comply with the
other requirements applicable to that grade of product.

26

The risk of harm that the Applicant, SUMMIT NUTRITIONALS
INTERNATIONAL INC., seeks to prevent is the risk that the Respondent,
SIOUX PHARM INC., will cause irreparable harm, or harm that is difficult to
remedy, to it, by affecting its reputation for honesty and the reputation of its
product, by raising doubts as to the purity thereof, and that this will have an
inevitable effect on the Applicant’s clients and is likely to result in a drastic
reduction of its sales and in its replacement by competitors, which it would
subsequently be difficult, if not impossible, to dislodge.

27

The said risk is not specifically provided for in any of the interlocutory injunctions
typified in the law.

28

It is important to refer, due to the predictable behavior of the Respondent,
SIOUX PHARM INC., not granting the protective order, matters to the Applicant,
SUMMIT NUTRITIONALS INTERNATIONAL INC, who has always showed in its
behavior transparency, strictness and the following the rules and honest
practices of the branch of the commercial activity they are inserted, enormous
damages, leading to a sales reduction and damaging its credibility in the market.

29

On another hand, from the granting of the protective order, which will not be
more than demanding from the Respondent, SIOUX PHARM INC., acts
accordingly to the honest practices of the practiced activity, mainly by avoiding
the adulteration of the commercialized product, no damage, obviously can result
to the Respondent, SIOUX PHARM INC.

Accordingly and on such other
grounds as this Honorable Court
finds on its own motion, the
Respondent, SIOUX PHARM INC.,
should be restrained from
making any statements likely to
discredit the Applicant, SUMMIT
NUTRITIONALS
INTERNATIONAL INC., and its
product and be further restrained
from introducing Chondroitine
Sulphate into the European
market that does not comply fully
with the purity requirement of at
least 90% of this product and, in
the case of pharmaceutical
grade chondroitine sulphate,
which does not comply with the
other requirements applicable to
that grade of product.
The Applicant requests that this
petition is served to the
Defendant in the terms of the
Hague Convention 15 November
1965 in order for the Defendant
to oppose to this petition within
the legal delay.

This protective order is requested as a preliminary to the action of
condemnation of the Respondent, SIOUX PHARM INC; in the same terms
requested in this petition.

Evidence:

Witness: Ana Santos, married, manager, with address at Empreendimento Nova
Amoreiras, Palácio – 3º Piso/Secção 9 Rua Artilharia 1, 71-77, 1250-038
Lisboa, Portugal

The attorney
Henrique Abecasis

Share This :   Technorati Twitter Stumble Upon share

Comments

Login To Post Your Comments

Username  :

ex : johnpeter
Password  :

password must have min 6 chars