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Direct Biologics, LLC v. Kimera Labs, Inc.

United States District Court, E.D. Missouri, Eastern Division

August 30, 2019

DIRECT BIOLOGICS, LLC, Plaintiff,
v.
KIMERA LABS, INC., Defendant.

          OPINION, MEMORANDUM AND ORDER

          HENRY EDWARD AUTREY UNITED STATES DISTRICT JUDGE

         This matter is before the Court on plaintiff's Motion for a Preliminary Injunction [Doc. No. 18]. Plaintiff claims defendant breached its duties under the parties' “Exclusive Distribution and Supply” Agreement. Plaintiff seeks to enjoin 21, 2019Defendant from employing its former employee, Adam Koster and from soliciting Plaintiff's customers' business. Defendant opposes the Motion, and on August 21, 2019, a hearing was held. For the reasons set forth below, the Motion is denied.

         Facts and Background

         Plaintiff's unverified Petition[1] alleges the following:

         Direct Biologics and Kimera Labs entered into an Exclusive Distribution and Supply Arrangement (the "Agreement") April 16, 2018.

         Under the Agreement, Kimera Labs appointed Direct Biologics as Kimera 's exclusive distributor, "for all of Kimera 's amniotic products, which ... consist of 'Amnio2,' a pure amniotic product, and 'Amnio2x,' which is an amniotic product combined with exosomes."

         Upon placing orders by Direct Biologics, Kimera Labs was required to, and on multiple occasions did, ship product into the State of Missouri to be distributed by Direct Biologics, as required by the Agreement.

         Direct Biologics has fully performed all of its obligations under the Agreement.

         Kimera Labs has committed numerous material breaches of the Agreement since the Agreement was signed, including:

         Kimera Labs has employed Adam Koster, a former employee of Direct Biologics, as Kimera Labs' national sales manager in violation of section 20 of the Agreement which states:

During the term of this Agreement and for a period of two (2) years after any expiration or termination of this Agreement, neither party will employ or solicit for hire as an employee, consultant or otherwise any of the other party's personnel without the other party's express written consent.

         Kimera Labs has used Adam Koster's knowledge of Direct Biologics' customers gained through his employment with Direct Biologics to sell amniotic products on Kimera Labs' behalf directly to Direct Biologics' customers in violation of section 21 of the Agreement which states:

Each party [] agrees that during the Term and for three (3) months thereafter, i t shall not, directly or indirectly, take, attempt to take, or otherwise interfere with any business with a customer, distributor or sub distributor of the other party.

         Kimera Labs has provided products with a shelf-life of less than l 0 months and refused to replace those products with products having a shelf-life of at least l 0 months, as ...


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