Genzyme, Apple, Royal Worcester: Intellectual Property

Shelbyzyme LLC, the owner of a patent used to treat organ-destroying Fabry disease, won $50 million from Genzyme Corp. after a jury trial.

Shelbyzyme filed the infringement suit in federal court in Delaware in October 2009.

Genzyme, a unit of France’s Sanofi (SAN) based in Cambridge, Massachusetts, encouraged and contributed to the infringement of Leonia, New Jersey-based Shelbyzyme’s 2006 patent 7,011,831, jurors in federal court in Wilmington, Delaware, found on July 17, according to court documents.

Genzyme was “not licensed or otherwise authorized” to use the recombinant DNA therapy for Fabry patients and used it anyway, Shelbyzyme said.

Fabry disease affects 1 in as many as 60,000 males and fewer females, according to the National Institutes of Health website on genetic conditions. The inherited disease results from a buildup of fat in organs and cells, causing pain, splotching, digestive distress and potential organ failure.

“We disagree with the jury verdict,” Bo Piela, a Genzyme spokesman, said in an e-mail. The company may appeal, he said.

Charles Emanuel, an attorney for Shelbyzyme, didn’t immediately reply to an e-mail seeking comment on the verdict.

The technology in the patent was developed by David Calhoun and George Coppola, researchers at City University of New York, according to court papers.

The case is Shelbyzyme v. Genzyme, 09-cv-768, U.S. District Court, District of Delaware (Wilmington).

Apple Patent Trial Jury to Learn Samsung Destroyed E-Mails

Apple Inc. persuaded a federal judge to let jurors hear about document destruction by Samsung Electronics Co. (005930) in a patent trial scheduled to begin July 30 in San Jose, California.

U.S. Magistrate Judge Paul S. Grewal in San Jose yesterday agreed with Apple that jurors should be told they can draw an “adverse inference” from Samsung’s failure to avoid auto- deleting e-mail that Apple later sought as evidence. The “rolling basis” Samsung used for deletions resulted in a similar ruling against the company seven years ago, he said.

“Rather than building itself an off-switch -- and using it -- in future litigation such as this one, Samsung appears to have adopted the alternative approach of ‘mend it don’t end it,” Grewal wrote. “Samsung’s mend, especially during the critical seven months after a reasonable party in the same circumstances would have reasonably foreseen this suit, fell short of what it needed to do.”

Apple, based in Cupertino, California, and Suwon, South Korea-based Samsung, the world’s two biggest makers of high-end mobile phones, accuse each other of copying designs and technology for mobile devices. The companies are fighting patent battles on four continents to retain their dominance in the $219 billion global smartphone market.

Grewal’s proposed instructions for the jury begin by saying, “Samsung has failed to prevent the destruction of relevant evidence for Apple’s use in this litigation.” It adds that Apple has proved that “the lost evidence was favorable to Apple.”

The instructions concluded by saying that jurors must determine for themselves whether to make the evidence destruction a factor in their verdict.

“You may choose to find it determinative, somewhat determinative, or not at all determinative in reaching your verdict,” according to the instructions.

The case is Apple Inc. (AAPL) v. Samsung Electronics Co. Ltd., 11- cv-1846, U.S. District Court, Northern District of California (San Jose).

Rambus Loses to LSI, STMicroelectronics in U.S. Patent Case

Rambus Inc., a computer-memory chip designer that has been fighting patent cases in court for a decade, lost a case against LSI Corp. and STMicroelectronics NV (STM) over controllers used in electronics including GPS devices and computers.

The U.S. International Trade Commission said the companies and its customers didn’t violate Rambus patent rights, upholding a judge’s findings from March. Notice of the decision was posted on the agency’s website, with a full opinion to be made public after both sides have a chance to redact confidential information.

Rambus, which got 96 percent of its $312.4 million in 2011 revenue from royalties, claimed the companies incorporated into their chips inventions Rambus scientists developed to speed the transfer of data. The memory controllers are used in networking gear, televisions, set-top decoders and other devices.

The patents were either invalid or not infringed, the commission said, agreeing with the trade judge’s findings that some of the patents were unenforceable because Rambus destroyed documents related to the litigation.

The dispute in this case centers on a type of dynamic random access memory called SDRAM that acts as the main memory in computers.

ITC Judge Theodore Essex found in March that all five Rambus patents were infringed, yet invalid because they sought to cover inventions already protected by other patents. The commission agreed on the invalidity of four patents, while saying the fifth wasn’t infringed.

The judge said separately that three patents, named after lead inventor Richard Barth, are unenforceable because Rambus purposely destroyed evidence needed by companies to defend themselves against Rambus’s infringement claims. The commission upheld that finding.

Both Rambus and the staff of the ITC, which acts as a third party on behalf of the public, asked the commission to overturn that finding because it was inconsistent with a decision the agency made in the Nvidia case.

Hynix Semiconductor Inc., which has been battling Rambus in courts since 1999, urged the commission to uphold the judge’s findings on document destruction because it’s trying to overturn a $397 million judgment won by Rambus after a 2006 trial.

A federal judge in California is considering whether Rambus should be precluded from enforcing some of its older patents against Hynix because of the document destruction.

A U.S. appeals court ruled last year that Rambus destroyed documents relevant to patent-infringement trials with Micron Technology Inc. and Hynix.

The case is In the Matter of Certain Semiconductor Chips and Products Containing Same, 337-753, U.S. International Trade Commission (Washington).

Lundbeck Gets EU Antitrust Complaint on Pay-to-Delay Drug Deals

H. Lundbeck A/S (LUN), the Nordic region’s second-largest drugmaker, was sent a complaint by European Union antitrust regulators over agreements with rivals that may have held back sales of cheaper generic drugs.

Pfizer Inc.’s Alpharma unit, Merck’s German subsidiary, Ranbaxy Laboratories Ltd. (RBXY) and other generic drugmakers were also sent EU complaints for agreeing to pay-to-delay deals with Lundbeck that may have delayed generic versions of its antidepressant citalopram, marketed as Celexa, for as long as two years, the European Commission said in a statement yesterday. Les Laboratoires Servier will soon get a similar EU antitrust complaint over a separate probe, the EU’s antitrust chief said.

“Lundbeck vigorously opposes any allegation of wrongdoing and does not believe its practice has violated European competition law,” the Copenhagen-based company said in a statement.

Servier hasn’t yet received the EU complaint, the French company said in an e-mailed statement yesterday.

Xellia Pharmaceuticals, Resolution Chemicals, AL Industrier ASA, Watson Pharmaceutical Inc.’s Arrow unit and Generics UK, now known as Mylan Inc., were also sent statements of objections over Lundbeck’s agreements with competitors who subsequently held back sales of generic versions of citalopram, the commission said.

Lundbeck’s deals included direct payments to generic competitors, guaranteed profits in a distribution agreements and the purchase of generic versions of citalopram to be destroyed, the EU said.

Andrew Ridger, a spokesman for New York-based Pfizer, said the company received a complaint relating to a business its Alpharma unit sold before it was bought by Pfizer’s King Pharmaceuticals subsidiary.

The complaint against Merck KGaA (MRK) related to an agreement made in 2002 by its former British subsidiary, Generics UK, Phyllis Carter, a spokeswoman for the company, said by telephone. Merck sold its generics business in May 2007 to Mylan for $6.7 billion. The company will analyze the statement and consider its next steps, she said.

Jen Lewis, a spokeswoman for Xellia in Congleton, England, said the EU probe related to a 2002 agreement between Lundbeck and Alpharma. Xellia was spun out from Alpharma in 2008 and it doesn’t manufacture or supply citalopram or other antidepressants, she said.

Watson, which owns Arrow, has received the complaint and is currently reviewing it, said Charlie Mayr, a spokesman for the Parsippany, New Jersey-based company.

Ranbaxy spokesman Krishnan Ramalingam had no immediate comment. Calls and an e-mail to Resolution Chemicals weren’t immediately answered. Calls to Mylan’s U.S. press office and to AL Industrier weren’t immediately returned.

For more patent news, click here.

Trademark

Google Could Face More Antitrust Probes, EU’s Almunia Says

Google Inc. (GOOG) may face further antitrust probes by the European Union, the bloc’s competition chief said, even as the owner of the world’s biggest search engine works to resolve an existing investigation.

EU Competition Commissioner Joaquin Almunia said the current investigation doesn’t cover areas such as applications for mobile phones. Regulators will review the “solutions that Google will present to us and hopefully we will reach a settlement” for the existing investigation, he said.

While “we have not opened any other investigation, I don’t exclude in future” that further probes will be started, Almunia told reporters in Brussels yesterday.

Almunia asked Google in May to make an offer to settle concerns that it promotes its own specialist search services, copies rivals’ travel and restaurant reviews, and that its agreements with websites and software developers stifle competition in the advertising industry.

Google, based in Mountain View, California, is under growing pressure from global regulators probing whether the company is thwarting competition in the market for Web searches. The U.S. Federal Trade Commission and antitrust agencies in Argentina and South Korea are also scrutinizing the company.

Google continues “to work cooperatively” with the commission, said Al Verney, a spokesman for the company in Brussels.

Regulators asked Google to extend an initial offer to modify its search engine to cover mobile applications for smartphones and tablet computers, two people familiar with the negotiations said last week.

In 2010, the EU’s antitrust agency began investigating claims Google discriminated against other services in its search results and stopped some websites from accepting competitors’ ads. While Microsoft Corp. (MSFT) and partner Yahoo! Inc. (YHOO) have about a quarter of the U.S. Web-search market, Google has almost 95 percent of the traffic in Europe, Microsoft said in a blog post last year, citing data from regulators.

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Copyright

Megaupload Founder’s Website Opposes U.S. Copyright Policy

Kim Dotcom, who is fighting extradition from New Zealand to the U.S. in a criminal copyright-infringement case, has set up a website asking Internet users to vote against President Obama in the November elections, Wired News reported.

He said in a posting on his kim.com website that the U.S. government “has declared war on the Internet” through copyright-enforcement efforts, according to Wired News.

He claims his Megaupload company was “a good corporate citizen” that cooperated with content owners and legal authorities, Wired News reported.

Dot.com has also posted a video to YouTube’s video-sharing site in which he addresses President Obama, asking “whatever happened to change, Mr. President?” according to Wired News.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Antique Diary Reveals Early Day Trade-Secret Theft From France

A diary recently belonging to Royal Worcester and Spode Ltd.’s Worcester Porcelain Museum makes it clear that the secrets of the famous porcelain ware was stolen from French potters, the U.K.’s Daily Mail reported.

John Flight, who then ran Royal Worcester, wrote in his journal that he stole secrets for the manufacturing of porcelain during the French Revolution and brought them home to England, according to the Daily Mail.

At that time Flight’s factory was trying to deal with technical problems involved in the production of high quality bone china, and was also facing competition, both from Europe and Asia, the newspaper reported.

His company, which was established in 1951, put the diary on display at the Antiques for Everyone Fair in Birmingham in the U.K., according to the Daily Mail.

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

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

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