Rhone-Poulenc Agro, S.A. v. DeKalb Genetics Corp.

271 F.3d 1081, 2001 WL 1456869
CourtCourt of Appeals for the Federal Circuit
DecidedNovember 19, 2001
DocketNos. 00-1266, 00-1352
StatusPublished
Cited by4 cases

This text of 271 F.3d 1081 (Rhone-Poulenc Agro, S.A. v. DeKalb Genetics Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rhone-Poulenc Agro, S.A. v. DeKalb Genetics Corp., 271 F.3d 1081, 2001 WL 1456869 (Fed. Cir. 2001).

Opinion

DYK, Circuit Judge.

Rhone-Poulenc Agro, S.A. (“RPA”) appeals from the decision of the United States District Court for the Middle District of North Carolina granting summary judgment of non-infringement on the ground that Monsanto Co. (“Monsanto”) has a valid license to U.S. Patent No. 5,510,471, reissued on December 14, 1999 as RE 36,449 (“the '471 patent”). Rhône-Poulenc Agro, SA. v. Monsanto Company, No. 1:97CV1138, 2000 U.S. Dist. LEXIS 21330 (M.D.N.C. Feb. 8, 2000). The issue here is whether a sublicensee (Monsanto) that acquired the sublicense from a licensee (DeKalb Genetics Corp. (“DeKalb”)), that acquired the original license by fraud, may retain the sublicense by establishing that the sublicensee was a bona fide purchaser for value. We hold that we are bound by tMs court’s earlier decision in Heidelberg Harris, Inc. v. Loebach, 145 F.3d 1454, 46 USPQ2d 1948 (Fed.Cir.1998), that a bona fide purchaser defense is available in such circumstances. Accordingly, we affirm the decision of the district court.

BACKGROUND

The detailed history of this case is set forth in our opinion in the compamon case of Rhône-Poulenc Agro, SA. v. DeKalb Genetics Corp., Nos. 00-1218, 00-1350, 00-1351, 2000 WL 33644776 (Fed.Cir. Nov. 19, 2001), which is also being issued today. Briefly the facts are these. From 1991 through 1994, RPA and DeKalb collaborated on the development of biotechnology related to specific genetic materials. During this time, a scientist at RPA, Dr. De-Rose, developed an optimized transit peptide (“OTP”) with a particular maize gene, which proved useful in growing herbicide resistant corn plants. The OTP is covered by the claims of the '471 patent and is the subject of RPA’s patent infringement claim against Monsanto.

In 1994, RPA, DeKalb, and non-party Calgene, Inc. (“Calgene”) entered into an agreement (the “1994 Agreement”) that provided:

RPA and CALGENE hereby grant to DEKALB the world-wide, paid-up right to use the RPA/CALGENE Technology and RPA/CALGENE Genetic Material in the field of use of corn. DEKALB shall have the right to grant sublicenses to the aforementioned right to use without further payment being made to RPA or CALGENE.

The RPA/CALGENE Technology and RPA/CALGENE Genetic Material included the invention claimed in the '471 patent. In 1996, DeKalb sublicensed its rights to the RPACalgene Technology and Genetic Material to Monsanto. At the same time Monsanto granted to DeKalb licenses to use certain intellectual property related to genetically-engineered corn. Monsanto also acquired a forty percent equity interest in DeKalb, and ten percent of DeKalb Class A (voting) stock.

On October 30, 1997, RPA filed suit against DeKalb and Monsanto, seeking, inter alia, to rescind the 1994 Agreement on the ground that DeKalb had procured the license (the “right to use”) by fraud. [1084]*1084RPA also alleged that DeKalb and Monsanto were infringing the '471 patent and had misappropriated RPA’s trade secrets. Monsanto defended, inter alia, on the ground that it had a valid license to practice the patent and use the trade secrets, based on the rights owned under the 1994 Agreement that were transferred by De-Kalb to Monsanto in 1996. At trial, a jury found, inter alia, that DeKalb had fraudulently induced RPA to enter into the 1994 Agreement. The district court ordered rescission of the 1994 Agreement. Nonetheless, Monsanto moved the district court for summary judgment that it had a valid license to the '471 patent and the right to use RPA’s trade secrets because under the 1996 Agreement Monsanto was a bona fide purchaser for value of the sublicense to the patent and the trade secrets. The district court orally granted this motion and dismissed the infringement and misappropriation claims against Monsanto. RPA moved for reconsideration of the district court’s dismissal, but the district court, relying on Heidelberg Harris, 145 F.3d 1454, 46 USPQ2d 1948, reaffirmed its grant of summary judgment in a February 8, 2000, opinion.

The district court found that, as a subli-censee of the '471 patent and the trade secrets, Monsanto was “entitled to be considered a bona fide purchaser, because it paid value for the right to use the technology without knowledge of any wrongdoing by DeKalb.” Rhône-Poulenc, 2000 U.S. Dist. LEXIS 21330, at *80. Because “Monsanto [was] a bona fide purchaser of the ... technology, [it] therefore [could not] be liable as a patent infringer or a trade secret misappropriater.” Id. at *71. The district court explicitly did not reach the issues of whether Monsanto’s bona fide purchaser defense would apply to any future licenses of RPA’s technology or whether, in light of the 1994 RPA DeKalb Monsanto Agreement granting DeKalb the right to sublicense, the bona fide purchaser defense would benefit sublicenses of Monsanto.

RPA filed this timely appeal, which concerns only the validity of Monsanto’s license to practice the '471 patent. On this appeal, RPA does not challenge the district court’s dismissal of RPA’s claim for trade secret misappropriation.

DISCUSSION

I

We have jurisdiction over this appeal pursuant to 28 U.S.C. § 1295(a)(1). Summary judgment is appropriate when “there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c); Chiuminatta Concrete Concepts, Inc. v. Cardinal Indus., Inc. ., 145 F.3d 1303, 1307, 46 USPQ2d 1752, 1755 (Fed.Cir.1998). We review a district court’s grant of a motion for summary judgment without deference. Ethicon Endo-Surgery, Inc. v. United States Surgical Corp., 149 F.3d 1309, 1315, 47 USPQ2d 1272, 1275 (Fed.Cir.1998).

II

In Rhône-Poulenc Agro, S.A. v. DeKalb Genetics Corp., No. 00-1218, 00-1350, 00-1351, 2000 WL 33644776 (Fed. Cir. Nov. 19, 2001), we have today affirmed the judgment of the district court, rescinding the 1994 licensing agreement based on a jury verdict finding that DeKalb acquired its patent license by fraud. RPA asserts that it necessarily follows that the Monsanto sublicense to the '471 patent is void, and that Monsanto can be sued for patent infringement. We disagree.

In Heidelberg Harris, 145 F.3d 1454, 46 USPQ2d 1948, we addressed the issue of a bona fide licensee defense to a claim for [1085]*1085patent infringement. In that case, inventor Loebach assigned his rights to an invention to his employer, the Motter Printing Co. (“Motter”). Thereafter, a patent on the invention was issued to Motter, and Motter later licensed the patent to Harris Graphics Corp ., a predecessor in interest to Heidelberg Harris, Inc. (“Harris”). Subsequently, Loebach sued Motter and Harris for patent infringement, alleging that the assignment of rights to Motter was “void” due to fraud. This court affirmed the district court’s grant of summary judgment of non-infringement in favor of Harris on the ground that Harris was a bona fide purchaser of the patent license. Id.

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271 F.3d 1081, 2001 WL 1456869, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rhone-poulenc-agro-sa-v-dekalb-genetics-corp-cafc-2001.