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Summaries and analysis of recent Delaware court decisions concerning business-related litigation.

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Superior Court Holds that a California Company that Places a Product in the "Stream of Commerce" Does Not Have Sufficient Contacts with Delaware for the Court to have Personal Jurisdiction over the Defendant

Sheer Beauty, Inc. v. Mediderm Pharmaceuticals & Laboratories, C.A. No. 05C-02-174 MMJ, 2005 WL 3073670 (Del. Super. Ct. Oct. 27, 2005). The plaintiff brought a claim against the defendant for breach of contract, fraudulent misrepresentation, negligent misrepresentation, consumer fraud, and breach of express and implied warranties. The defendant, whose principle place of business was in California, moved to dismiss for lack of personal jurisdiction, and the court granted the defendant's motion

The defendant, Mediderm Pharmaceuticals & Laboratories, sold the plaintiff, Sheer Beauty, Inc., a skin-whitening cream. After the plaintiff distributed the cream, an analysis revealed that the cream did not contain a sufficient percentage of the active ingredient, and the plaintiff brought an action alleging a variety of theories for recovery. The defendant move to dismiss for lack of personal jurisdiction. Because the plaintiff made a prima facie showing that the defendant contracted to supply a product in Delaware, the court found that it had a statutory basis for jurisdiction pursuant to the long-arm statute. However, when turning to the minimum contacts analysis pursuant to the Due Process Clause, the court found that placing a product in the "stream of commerce" was an insufficient contact for the defendant to be subject to the jurisdiction of Delaware.