Fox Team Wins Federal Appeal To Retain Jury’s Verdict and $6.4 Million Award for Health Products Distributor

April 18, 2016 – Press Releases

A litigation team led by Fox Rothschild attorneys Gerard P. Norton and Ernest E. Badway has successfully defended the appeal of a $6.4 million judgment they secured for a Norwegian health products distributor in its suit against a New York company for reneging on a contract that granted exclusive rights to distribute in Scandinavia.

Fox has represented Nature’s Plus Nordic AS (NPN), a wholly owned subsidiary of Dermanordic A/S, a leading health and beauty care distributor in the Nordic region distributing among others brands such as bareMinerals, Elizabeth Arden PRO, Bliss, Molton Brown and Elemis, in this six-year dispute. The April 15, 2016 decision by the U.S. Court of Appeals for the Second Circuit clears the way for NPN to collect on the $6.4 million judgment.

In its lawsuit, NPN alleged that Natural Organics, Inc. (NOI), of Melville, NY, in 2009 breached the contract that granted NPN the exclusive rights for 10 years to distribute NOI’s health supplements products to retail stores in Norway, Sweden, Denmark and Finland.

Instead of honoring the contract, the suit alleged that NOI gave the distribution rights to a former NPN employee and then falsely claimed that NPN had failed to meet minimum purchase requirements.

But the courts concluded that NOI had no right to unilaterally cancel the contract and that NPN was entitled to compensation for the millions it spent distributing NOI’s Nature’s Plus Brand nutritional supplements products to the Scandinavian market.

After a three-week trial in February 2015, a jury awarded NPN more than $4.3 million in damages. The trial judge later added more than $2.1 million in prejudgment interest.

Now a three-judge panel of the U.S. Court of Appeals for the Second Circuit has flatly rejected NOI’s appeal in which it claimed the verdict was unfair and that the lower court’s calculations were flawed.

The court issued a summary order in which it refused to disturb the verdict in any way, saying it appeared the jury was “restoring NPN to the position it was in before the contract was formed.”

Norton, a partner with the firm, is the chair of Fox’s Intellectual Property Litigation Practice Group and co-chair of the Life Sciences Practice Group. He has extensive experience litigating complex matters pertaining to patents, trademarks, copyrights, trade secrets and breaches of contract, as well as handling intellectual property portfolio protection and enforcement.

Badway, a partner with the firm, is co-chair of the Securities Industry Practice Group and a member of the White-Collar Criminal Defense & Regulatory Compliance Practice Group. He represents corporations, limited liability companies, partnerships and financial institutions, such as broker-dealers, investment advisers, private equity and hedge funds, banks and insurance companies, among others. Badway also counsels and advises officers, directors, executives, registered persons and employees on a wide range of commercial, business, securities, intellectual property, employment, real estate, corporate, pharmaceuticals, partnership disputes, contracts and other business issues and litigation.