Bloomberg News

Monsanto, Apple, Nike, McDonald’s: Intellectual Property

August 03, 2012

Monsanto Co. was awarded $1 billion, the biggest U.S. jury verdict this year, in a patent- infringement trial against DuPont Co. (DD:US) over seeds for growing herbicide-tolerant soybeans.

The verdict was the fourth-largest jury award in a patent trial in U.S. history, according to data compiled by Bloomberg. The largest patent verdict, for $1.7 billion, was awarded in 2009 against Abbott Laboratories (ABT:US) in a case involving the arthritis drug Humira and was later reversed on appeal.

The panel of five women and three men in federal court in St. Louis began their deliberations Aug. 1 and returned 45 minutes later with the verdict against DuPont, ending a four- week trial.

The trial revolved around Monsanto’s patent for making Roundup Ready crops, a technology at the heart of its $13.7 billion in annual revenue. Farmers have embraced the technology because it allows them to kill weeds with Roundup herbicide while leaving crops unscathed.

“This verdict highlights that all companies that make early and substantial investments in developing cutting edge technology will have their intellectual property rights upheld and fairly valued,” Monsanto General Counsel David Snively said in an e-mailed statement.

DuPont said in a statement that it strongly disagrees with the verdict and will appeal it.

“There were several fundamental errors in the case which deprived the jury of important facts and arguments and led to the disappointing outcome,” DuPont said in the statement. “DuPont will appeal at the earliest possible opportunity and expects to overturn this verdict.”

The jury’s finding that DuPont’s infringement was willful means the damages could yet be increased, according to Monsanto’s statement.

Monsanto offered to settle the lawsuit during the trial by giving DuPont the opportunity to license its technology.

“The interesting part of the award was the speed of the decision,” Jeff Windau, a St. Louis-based analyst at Edward Jones & Co., said in an e-mail. “Obviously Monsanto put forth some compelling evidence.”

The patent was initially issued in 1997, based on a 1994 application. In 2003, Monsanto asked the U.S. Patent and Trademark Office to reissue the patent to correct what it said was an inadvertent mixing of patent claims from 1990 and 1994 applications.

DuPont contended Monsanto did that to mislead the patent office so the agency wouldn’t discover it was trying to hide information that might have blocked the patent.

The case is Monsanto Co. (MON:US) v. E.I. du Pont de Nemours & Co., 09-cv-686, U.S. District Court, Eastern District of Missouri (St. Louis).

Apple Seeks Sanctions for Samsung’s Evidence Leak at Trial

Apple Inc. said a federal judge should rule its phone patents were infringed by Samsung Electronics Co. (005930) after a lawyer for the Korean manufacturer publicly released evidence the judge had excluded from trial.

Apple, in an Aug. 1 filing with the U.S. District Judge Lucy Koh in San Jose, California, said the July 31 release was designed to convey to jurors, through the media, arguments rebutting Apple’s central allegations that Samsung copied the iPhone and iPad. The move was “bad faith litigation misconduct” meant to prejudice the jury, Apple said.

“Apple requests that the court issue sanctions granting judgment that Apple’s asserted phone-design patent claims are valid and infringed by Samsung,” according to the filing signed by lawyer William Lee .

The evidence fight between the companies is being conducted without the jury, which on July 31 heard opening arguments in the case. Apple, based in Cupertino, California, seeks $2.5 billion for its claims that Samsung infringed patents covering designs and technology for mobile devices. Samsung countersued and will present claims that Apple is infringing two patents covering mobile-technology standards and three utility patents.

John Quinn, the Samsung attorney who approved the release of the information, said in his own statement to the court that is was done in response to a request from members of the media and the information was already in public court filings made by Samsung or Apple and wasn’t intended to prejudice the jury.

Koh on July 31 barred Samsung from presenting images of a smartphone that Samsung claims it was developing in 2006, the year before Apple introduced the iPhone. Koh rejected Samsung’s request to reconsider her ruling for what she said was at least the third time, standing by her earlier decision that the evidence wasn’t “timely disclosed” in Samsung’s arguments pertaining to patent infringement.

In its e-mailed statement that Apple objects to, Samsung said that Koh’s ruling means it “was not allowed to tell the jury the full story and show the pre-iPhone design for that and other phones that were in development at Samsung in 2006, before the iPhone.”

Adam Yates, a Samsung spokesman, declined to comment on Apple’s initial letter seeking sanctions.

Apple said that if Koh doesn’t simply rule that Samsung has infringed the patent, alternatively she should tell the jury Samsung engaged in “serious misconduct,” that she has found Samsung copied the designs and features from Apple products, and preclude Samsung from any further mention of evidence regarding a pre-existing design.

The case is Apple Inc. v. Samsung Electronics Co. Ltd., 11- cv-01846, U.S. District Court, Northern District of California (San Jose).

Nike Planning Soccer Ball Radar Device, New Patent Indicates

Nike Inc. (NKE:US) has released shoes and wristbands this year that allow athletes to track their performance. Now it’s planning to put sensors on soccer balls and other equipment to offer data to players of team sports.

The world’s largest sporting-goods maker this week obtained patent 8,231,506, which covers an invention dubbed Nike+TM that uses a computerized radar system with transmitters placed on a ball and players to evaluate individual statistics such as the strength of a shot in soccer and how well a team plays together.

Nike, based in Beaverton, Oregon, has been pushing into digital gadgetry as more people turn to mobile applications to enhance daily activities. The company released the FuelBand, a bracelet that tracks daily activity in January, followed a month later by shoes equipped with sensors that can record such metrics as how high a player jumps during a dunk.

Mary Remuzzi, a spokeswoman for Nike, declined to comment on the patent and when such a product might come to market.

These offerings are part of the company’s Nike+ brand that began in 2006 with a running shoe that used a sensor to record data to Apple Inc. (AAPL:US)’s iPod.

Nike is using its digital strategy to increase the amount of time consumers spend with its brand as a way to drive sales. With the FuelBand, users can download data to a smartphone application. They can then compare results with friends who also have the bracelet and share them on Facebook Inc. (FB:US)’s social network.

The new system could eventually work with several sports including football, basketball, baseball and hockey and serve as a way for coaches to evaluate players, according to a copy of the patent posted on the U.S. Patent and Trademark Office website.

In one scenario, it could track two soccer players at the same time with sensors on their shoes, as well as the ball, to measure how well they pass to each other.

For more patent news, click here.

Trademark

McDonald’s Objects to Use of ‘Happy Meals’ in Political Ad

McDonald’s Corp. (MCD:US), the world’s largest restaurant chain, told the Topeka Capitol-Journal that it will ask a candidate for Kansas State Senate to stop using its name in a political advertisement.

Kansas State Representative Joe Patton was to receive a cease-and-desist letter from the chain, asking him to change his “Happy Meals” ad, in which he compared an opponent’s tax scheme to someone who goes into McDonald’s, orders a “Happy Meal,” eats it himself and then asks his grandson to pay for it, the newspaper reported.

Patton told the newspaper that he was using the McDonald’s ad as a metaphor and will pull it upon request from the chain.

McDonald’s, based in Oak Brook, Illinois, became aware of the ad after hearing a report from one of its Topeka, Kansas- area franchisees, according to the newspaper.

For more trademark news, click here.

U.K. Furniture Makers Threatened by Proposed Copyright Changes

British furniture makers are concerned about a proposed change in the U.K.’s copyright law that would bar reproductions of furniture by famous designers until 70 years after their death, the Daily Mail newspaper reported.

Famous furniture designs such as those by Charles Eames can now be copied in the U.K. 25 years after their creation, the newspaper reported.

The proposed changes, which would bring U.K. copyright law up to the standard in the European Union, would place furniture in the same category as musical compositions or paintings, according to the Daily Mail.

The revised law would criminalize the unauthorized production or sale of such furniture, according to the newspaper.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Physician Sued Over Pennsylvania ‘Medical Gag Rule’ for Fracking

A Pennsylvania physician filed a lawsuit in federal court challenging as unconstitutional a state law that bars him from revealing information about the chemical makeup of hydraulic fracturing fluids used in the gas-drilling industry.

Dr. Alfonzo Rodriguez of Dallas, Pennsylvania, is opposing a section of a 2012 amendment to the Pennsylvania Oil and Gas Act that is known informally as the “Medical Gag Rule.”

This section of the rule mandates that in the event of a medical emergency related to hydraulic fracturing, health professionals to whom information is given about the chemicals involved in the fluid be barred from passing that information on to anyone else. The legislation covers chemicals deemed to be a trade secret or otherwise proprietary information, according to the bill’s text.

Rodriguez, a specialist in kidney disease, has treated patients who have been directly exposed to high-volume fracturing fluids, he said in his complaint, filed July 27 in Scranton, Pennsylvania. One such patient “was admitted to the hospital with a complicated diagnosis with low platelets, anemia, rash, and acute renal failure that required extensive hemodialysis and exposure to chemotherapeutic agents,” according to court papers.

The doctor argued in his complaint that the so-called Medical Gag Rule is an impermissible restriction on his freedom of speech, and required him to violate his principles of medical ethics mandated by his medical licensing authority.

Under his profession’s ethics code, Rodriguez said he is required to “continue to study, apply and advance scientific knowledge, maintain a commitment to medical education, make relevant information available to patients, colleagues and the public, obtain consultation and use the talents of other health professionals when indicated.”

He said his patients’ right of self-decision is violated if he is barred from giving them enough information to enable them to make informed choices.

The Medical Gag Rule, he said, is “unconstitutionally overbroad” restriction on free speech because it requires a health-care professional to enter into a confidentiality agreement before receiving information “for the ethical and competent treatment of a patient.”

Rodriguez asked the court to declare the rule unconstitutional and to bar Pennsylvania officials from enforcing it. He also requested awards of damages, attorney fees and litigation costs.

In a fact sheet about hydraulic fracturing, the Pennsylvania Independent Oil & Gas Association said that the chances of groundwater contamination from the process is “one in 200 million” and that water and sand make up about 99.5 percent of any fluid used in fracking, together with “a small number of dilute chemicals.”

Rodriguez is represented by Paul. A. Rossi of Kennett Square, Pennsylvania.

The case is Rodriguez v. Krancer, 12-cv-01458, U.S. District Court, Middle District of Pennsylvania (Scranton).

To contact the reporter on this story: Victoria Slind-Flor in San Francisco at vslindflor@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • DD
    (EI du Pont de Nemours & Co)
    • $67.72 USD
    • 0.82
    • 1.21%
  • ABT
    (Abbott Laboratories)
    • $38.38 USD
    • 0.41
    • 1.07%
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