Avents Cropscience v. Pioneer Hi-Bred Intern.

• Decision Date: 20 June 2003
• Docket Number: No. 1:00 CV 00463.,1:00 CV 00463.
• Citation: 269 F.Supp.2d 644
• Court: U.S. District Court — Middle District of North Carolina
• Parties: AVENTIS CROPSCIENCE N.V., Plaintiff, v. PIONEER HI-BRED INTERNATIOAL, INC., and DOW AGROSCENCES, LLC, Defendants.

269 F.Supp.2d 644

AVENTIS CROPSCIENCE N.V., Plaintiff, v. PIONEER HI-BRED INTERNATIOAL, INC., and DOW AGROSCENCES, LLC, Defendants.

No. 1:00 CV 00463.

United States District Court, M.D. North Carolina.

June 20, 2003.

Timothy G. Barber, Bradley Clayton Morris, Womble Carlyle Sandridge & Rice, Charlotte, NC, Eric H. Weisblatt, Regis F. Slutter, Barbara W. Walker, Ronni S. Jillions, Susan M. Dadio, Albert Tramposch, Catherine B. Richardson, H. Jonathan Redway, David M. Schlitz, Ryan P. Page, Burns Doane Swecker & Mathis, L.L.P., Alexandria, VA, Allen Robert Baum, Burns Doane Swecker & Mathis, Durham, NC, for Plaintiff.

William Kearns Davis, Daniel Alan M. Ruley, Bell Davis & Pitt, P.A., Winston-Salem, NC, William H. King, Jr., Mcguire Woods, LLP, Richmond, Va, Daniel J. Cosgrove, Zarley Mckee Thomte Voorhees & Sease, P.L.C., Des Moines, la, Leora Ben-Ami, Thomas F. Fleming, Howard Suh, Melissa Mandrgoc, Christopher T. Jagoe, Oliver Bennett, Clifford Chance Rogers & Wells, Lip, New York, NY, Kurt E. Lindquist, II, Charlotte, NC, for Defendants.

MEMORANDUM OPINION

BEATY, District Judge.

I. INTRODUCTION

This matter is currently before the Court on Defendants' Joint Motion for a Moratorium on Discovery Related to Aventis' Infringement Claims [Document # 251], Pioneer Hi-Bred International, Inc.'s Motion for Summary Judgment of Unenforceability, Invalidity and Non-Infringement of the Patents-In-Suit Based Upon Collateral Estoppel [Document #254], and Defendant Dow Agrosciences LLC's Motion for Summary Judgment of Collateral Estoppel [Document # 257]. For the reasons explained below, Defendants' Motions for Summary Judgment are GRANTED and all claims asserted by Plaintiff against Defendants are hereby DISMISSED. Additionally, Defendants' Joint Motion for a Moratorium on Discovery Related to Aventis' Infringement Claims is DISMISSED as moot.

II. FACTUAL AND PROCEDURAL BACKGROUND

The underlying dispute in this case concerns Plaintiff Aventis CropScience N.V.'s ("Plaintiff or "Aventis") allegations that four United States Letters Patents, Nos. 5,254,799; 5,545,565; 5,767,372 and 6,107,546 (collectively, the "patents-in-suit") have been infringed upon by Defendants Pioneer Hi-Bred International, Inc. ("Pioneer") and Dow AgroSciences LLC ("Dow") (collectively, "Defendants"). Plaintiff is the assignee of the patents-insuit. (Second Am. Compl. 114.) The patents-in-suit relate to genetic transformation vectors that allow the expression of an insecticidal endotoxin in certain hybrids of corn. Two types of corn hybrids have been implicated here. The first corn hybrid involves the insertion of a truncated fragment of DNA called CrylA(b) which is found in a bacteria known as Bacillus thuringiensis ("Bt"). The CrylA(b) fragment allows the Bt bacteria to create a protein toxic to certain insect pests of the genius Lepidoptera. The DNA fragment is placed in corn cells in order to create a corn hybrid capable of resisting the Lepidoptera insects. This insect resistant corn hybrid is known as Cry1A(b). The second product in question involves a similar Bt corn hybrid containing a fragment of DNA protein from Bt bacteria called Cry IF which, inserted into corn, creates another insect resistant corn hybrid known as Cry1F.

Plaintiff alleges that Defendants sell and induce sales of the aforementioned Bt corn hybrids in violation of the patents-in-suit. Plaintiff claims that Pioneer advertises and sells the Cry1A(b) corn hybrid under the brand name YieldGard® (MON810).¹ (Aventis Cropscience N.V.'s Combined Opp. to Dow Agrosciences, LLC's Mot. for Summ. J. of Collateral Estoppel and Pioneer Hi-Bred International, Inc.'s Mot. for Summ. J. of Unenforceability, Invalidity, and Non-Infringement of the Patents-In-Suit Based Upon Collateral Estoppel at 3.) Plaintiff also claims that Defendants Pioneer and Dow have conducted research and development into the CrylF corn hybrid and are petitioning to gain non-regulated status for the CrylF hybrid so that it may be available for sale. (Pi's Br. Opp. Mot. Transfer at 4.) Plaintiff argues that this activity is also in violation of the patents-in-suit.

Plaintiff brought suit on May 5, 2000, against Defendants for what Plaintiff alleges are sales and development activities that infringe on the patents-in-suit related to the Bt corn hybrids. However, shortly after Aventis filed the instant action, Monsanto Company ("Monsanto") filed a separate declaratory judgment action against Aventis in the Eastern District of Missouri on December 4, 2000, relating to MON810 Yieldgard ® and Plaintiffs claims of infringement against Monsanto in a case known as Monsanto v. Bayer Bioscience, N.V., 264 F.Supp.2d 852 (E.D.Mo. 2002) (the "Missouri Action"). The collateral Monsanto action concerned whether the same four Aventis patents-in-suit in the instant matter are valid or enforceable. The Eastern District of Missouri issued its final memorandum and order in that case on December 27, 2002. Ultimately, as discussed in Section III infra, the Monsanto court held that all of Bayer's patent claims at issue in the case were unenforceable, while individual patents were also either non-infringed or invalid. On January 6, 2003, Aventis filed a notice of appeal seeking a review in the Federal Circuit Court of Appeals of all of the Monsanto court's orders and judgments. (Mem. in Supp. of Def.'s Mot. for Summ. J. of Collateral Estoppel, Exh. E at 1-2.)

Following its notice of appeal in the Missouri Action, Aventis then moved for a complete stay of the instant case before this Court pending its appeal of the Missouri Action, which the Court denied after a hearing held on April 1, 2003. Additionally, relying on the decision by the Monsanto court, Defendants Pioneer and Dow filed separate motions for summary judgment, on January 10, 2003, and January 13, 2003, respectively, asserting that the doctrine of collateral estoppel precludes Aventis from re-litigating identical issues in this proceeding. Additionally before the Court is Defendants' Joint Motion for a Moratorium on Discovery Related to Aventis' Infringement Claims, filed on January 10, 2003. The Court held a hearing on Defendants' Motions for Summary Judgment on April 11, 2003.

III. FINDINGS OF THE EASTERN DISTRICT OF MISSOURI IN MONSANTO v. BAYER BIOSCENCE, N.V., CASE NO. 4:00CV01915 ERW

In Monsanto, Plaintiff Monsanto sought a declaratory judgment that its MON810 Yieldgard® corn products did not infringe the claims of four United States patents, United States Patent No. 5,254,799 ("the '799 patent"), United States Patent No. 5,545,565 ("the '565 patent"), United States Patent No. 5,767,372 ("the '372 patent"), and United States Patent No. 6,107,546 ("the '546 patent"), the same four patents-in-suit in the instant matter, owned by Defendant Bayer Bioscience.² In response, Bayer counterclaimed that Monsanto infringed on claims 1-5 of the '799 patent, claims 1-8 and 12 of the '565 patent, claims 1-5, 13, and 18 of the '372 patent, and claims 1-7 of the '546 patent. The Monsanto court issued three separate Memoranda and Orders to establish its findings and holdings. Specifically, the December 13, 2002 Memorandum and Order held that the '799 patent was not infringed, and that the '546 patent and claims 13 and 18 of the '372 patent were invalid based upon the preclusive effect of collateral estoppel stemming from a prior lawsuit that occurred in the District of Connecticut, Plant Genetic Systems N.V. v. DeKalb Genetics Corp., 175 F.Supp.2d 246 (D.Conn.2001) ("the Connecticut Action").³ After it held a Markman hearing⁴ to construe certain terms of the remaining asserted claims, the Monsanto court issued the December 17, 2002 Memorandum and Order, which held that the '565 patent and claim 4 of the '372 patent were not infringed. Ultimately, on December 27, 2002, the Monsanto court held that the '799 patent was unenforceable because of Bayer's inequitable conduct, and consequently, all descendant patents, to include claims 1-3 and 5 of the '372 patent were unenforceable as a result. The Court notes that it will discuss the findings of the Eastern District of Missouri in the Missouri Action to the extent that the Court may elect to adopt the findings of the Eastern District of Missouri as its own on the basis of collateral estoppel as asserted by both Pioneer and Dow in their respective Motions for Summary Judgment.

A. Non-Infringement of '799 Patent Based Upon the Effect of Collateral Estoppel of the Connecticut Action

After the Markman hearing, the Monsanto court issued its first Memorandum and Order on December 13, 2002, in which it held that the Connecticut Action precluded the re-litigation in the Missouri Action of the claims of infringement of the '799 patent, and the '546 patent, and claims 13 and 18 of the '372 patent. In the Connecticut Action, the court found that the relevant patent⁵, belonging to Aventis' predecessor, Plant Genetic Systems, N.V., ("PGS"), was not infringed upon because it was limited to dicotyledonous plants, and did not apply to monocotyledonous plants ("monocots") such as corn.⁶ Plant Genetic Sys., N.V., v. DeKalb Genetics Corp., 175 F.Supp.2d 246, 270 (D.Conn.2001). Because all of the accused products in the Connecticut Action were monocots, the court in the Connecticut Action held that DeKalb, now a subsidiary of Monsanto, did not infringe the '236 patent. Id.

Relying upon the prosecution history of the '236 patent, which determined that monocots were not susceptible to transformation by Agrobacterium, the Monsanto court found that Bayer, as its predecessor corporation Plant Genetic Systems, N.V., ("PGS") had a full and fair opportunity to litigate the question of whether corn was susceptible to transformation by the Agrobacterium in the Connecticut Action. Monsanto v. Bayer Bioscience, N.V., No 4:00CV01915 ERW, slip op. at 12 (E.D.Mo. Dec. 13, 2002). Accordingly, the Monsanto court relied upon the doctrine of collateral estoppel...