A year ago, a federal judge in St. Louis issued a then-sealed order in which he found that E.I. du Pont de Nemours and Co. “knowingly committed a fraud upon the court” in a high-profile patent dispute with Monsanto Co. On Friday, it was learned that the judge had recently unsealed his order, adding to the woes of DuPont, which had already been hit with a $1 billion verdict in the case in August.
The suit has pitted Winston & Strawn, for Monsanto, against Kirkland & Ellis and Boies Schiller & Flexner, for DuPont.
U.S. district judge E. Richard Webber issued several sealed orders in the case, most critically a December 2011 ruling in which he held that DuPont knowingly misrepresented key facts in court, thus delaying resolution of Monsanto’s claims. Webber sealed that and other rulings because Monsanto’s infringement claims were pending, and he didn’t want media coverage of DuPont’s wrongdoing to taint the jury pool. However, Monsanto prevailed at trial, prompting Webber to lift his earlier protective order in a 14-page ruling issued on Nov. 16. Bloomberg News first reported on Webber’s ruling on Friday.
“The public is entitled to full disclosure of the defendants’ fraud,” Webber wrote in his unsealing order. “Possible embarrassment or discomfort is not enough to justify sealing court records.”
Monsanto has made billions through the years by licensing Roundup Ready, a patented approach to making crops resistant to the company’s Roundup herbicide. (Crops treated with Roundup survive, but weeds don’t.) In 2002, DuPont agreed to license Roundup Ready patents. Four years later, DuPont combined its own technology with Monsanto’s patented technology to create a new product, which DuPont planned to sell as an alternative to Roundup Ready, but never actually brought to market.
After Monsanto sued DuPont for patent infringement in 2009, DuPont argued that its 2002 license agreement allowed it to combine Monsanto’s technology with its own (a process known as “stacking”). Webber rejected that argument on summary judgment in 2010. DuPont’s lawyers at Kirkland and Boies Schiller then shifted gears to argue that Monsanto’s patents are invalid. A jury rejected those invalidity arguments in August, awarding Monsanto $1 billion in damages—one of the biggest patent infringement verdicts ever.
Thanks to Webber’s recent decision to unseal his old orders, it’s now known that in December 2011, he tore into DuPont for raising the stacking defense on summary judgment. After reading emails exchanged by DuPont’s execs and their outside lawyers between 2002 and 2008, the judge ruled that DuPont knew that its 2002 license agreement prohibited it from stacking, but raised the argument anyway.
“They have intentionally made statements to the Court that are directly contradicted by facts. In doing so, Defendants have perpetuated a fraud against the Court,” he wrote.
To punish DuPont for its “abuses of the judicial process,” the judge struck some of the company’s counterclaims in the case, and ruled that Monsanto was entitled to attorneys fees incurred from defending those counterclaims.
Winston partner George Lombardi, Monsanto’s lead counsel, did not immediately return a call seeking comment.
Kirkland partner Leora Ben-Ami, who served as lead counsel for DuPont at trial, referred a request for comment to a DuPont spokesperson, who sent the following statement from DuPont general counsel Tom Sager: “DuPont told the truth and did not mislead the court. The sanctions ruling is dead wrong. Today, DuPont asked the Court to unseal the briefs and exhibits on the sanctions order because those documents prove we told the truth.”
DuPont still has antitrust counterclaims pending against Monsanto, which are scheduled to go to trial before Webber in October 2013. DuPont has also vowed to appeal the $1 billion verdict against it.