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Akzo Cries Foul on New Dow Patents

Tuesday, July 16, 2013

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AkzoNobel is accusing Dow Chemical Co. of sidestepping an R&D partnership by attempting to single-handedly patent coating products that the companies developed together.

Dow initiated the partnership breakup and applied for the patents several months later, AkzoNobel alleges in a new lawsuit.

AkzoNobel says the patent actions by Dow's subsidiary, Dow Advanced Materials, violate the two companies' former development agreement and will harm the coatings maker when confidential information from the patent applications becomes public in December.

A heavily redacted version of the lawsuit was filed June 25 in the Court of Chancery in Delaware, where Dow is headquartered. The original complaint, filed June 20, remains sealed.

AkzoNobel Eurocure
AkzoNobel

AkzoNobel is a global supplier of packaging coatings and inks, including Eurocure. Akzo is the world's largest coating company.

Dow’s Advanced Materials Division, built on the old Rohm and Haas Co. assets in Philadelphia, PA, consists of five businesses: Coatings, Building and Construction; Paper and Textiles; Specialty Packaging and Films; Designed Polymers and Separations Technologies; and Electronic Materials.

Packaging Products Noted

The suit says that the companies signed a Joint Development Agreement (JDA) in January 2010 to develop a product. The initial agreement led to addenda for "numerous joint development projects," the suit says.

The public version of the Akzo suit blacks out the actual coatings and materials at issue in the case, but the complaint specifically notes that both parties manufacture materials and protective coatings for beverage and food packaging containers.

Terms of the development agreements give Akzo, "at a minimum," joint ownership rights to all jointly developed inventions and require that the companies "attempt to reach a consensus on inventorship and whether the invention is a JDA-Invention," the complaint says.

Dow packaging
Dow Advanced Materials

The suit does not identify the coatings at issue but notes that both Dow and AkzoNobel make coatings and materials for food and beverage packaging.

The agreements also require that the parties "cooperate in patenting of JDA-Inventions," the suit says.

Termination and Patent

In October 2011, the suit says, Dow notified Akzo that the chemical maker would terminate the Joint Development Agreement within 90 days. Then, in May 2012, according to Akzo, Dow served notice that it would file two patent applications related to JDA inventions.

Akzo says it lodged objections with Dow about the patent applications in June 2012.

"Akzo’s objections were not unreasonable," the suit says. "Dow did not cooperate with Akzo to determine the appropriate course of action in filing or prosecution of the Patent Applications. Rather, Dow unilaterally acted and filed the patent applications."

The patent applications, which include confidential information, automatically become public 18 months after the filing date.

Dow Advanced Materials
Dow Chemical Co.

Dow Advanced Materials, the successor to Rohm and Haas, consists of five businesses, including Coatings, Building and Construction.

The five-count suit alleges breach of contract, breach of implied covenant of good faith and fair dealing, and unjust enrichment by Dow. AkzoNobel is seeking a permanent injunction to stop Dow from pursuing the patent applications and revealing confidential information.

Dow spokeswoman Jennifer Kitt wrote in an email that the company was aware of the complaint. "Dow believes it has acted in compliance with terms of the referenced joint development agreement and will vigorously defend this case," she wrote.

AkzoNobel attorney Daniel Brown declined to comment on the suit.

   

Tagged categories: AkzoNobel; Business matters; Dow Chemical Company; Formulating; Lawsuits; Raw materials

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