Nova Chemicals Corporation (Canada) et al v. Dow Chemical Company
Filing
62
MEMORANDUM OPINION re 30 motion for sanctions, attorneys' fees, and costs. Signed by Judge Leonard P. Stark on 9/30/15. (ntl)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
NOVA CHEMICALS CORPORATION
(CANADA) and NOVA CHEMICALS INC.
. (DELAWARE),
Plaintiff,
v.
THE DOW CHEMICAL COMP ANY,
Defendant.
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C.A. No. 13-1601
Richard L. Horwitz and David E. Moore, POTTER ANDERSON & CORROON, LLP,
Wilmington, DE
Ford F. Farabow, Jr., Darrel C. Karl, Ronald A. Blecker, and Mark J. Feldstein, FINNEGAN,
. HENDERSON, FARABOW, GARRETT & DUNNER, L.L.P., Washington, DC
H. Woodruff Turner and Thomas A. Donovan, K&L GATES LLP, Pittsburgh, PA
Louis J. Freeh and Lawrence Byrne, PEPPER HAMILTON LLP, New York, NY
Raymond A. Miller, PEPPER HAMILTON LLP, Pittsburgh, PA
Counsel for Plaintiffs
Rodger D. Smith II, MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, DE
Anton R. Valukas, Harry J. Roper, Aaron A. Barlow, and Paul D. Margolis, JENNER & BLOCK
LLP, Chicago, IL
Kathleen M. Sullivan, Raymond N. Nimrod, and William B. Adams, QUINN EMANUEL
URQUHART & SULLNANLLP, New York, NY
Counsel for Defendant
MEMORANDUM OPINION
September 30, 2015
Wilmington, Delaware
STARK, U.S. District Judge:
This action is related to a prior patent infringement lawsuit in this Court involving the
same parties, wherein on June 18, 2010 a judgment of infringement was entered against NOVA
Chemicals Corporation (Canada) and NOVA Chemicals Inc. (Delaware) (collectively "NOVA"
or "Plaintiffs"). (C.A. No. 13-1601 D.I. 1 ~~ 4, 7; see also C.A. No. 05-737) The NOVA entities
were the defendants in the earlier suit.
Now pending before the Court is The Dow Chemical Company's ("Dow" or
"Defendant") Motion for Sanctions, Attorneys' Fees, and Costs against NOVA. (D.I. 30) Dow
was the Plaintiff in the earlier suit.
For the reasons stated below, the Court will grant Dow's motion to 'the extent it seeks an
award of attorney fees pursuant to 35 U.S.C. § 285. Dow's motion will be denied in all other
respects.
I.
BACKGROUND
On September 23, 2013, NOVA instituted this independent action in equity to set aside
the prior judgment. (D.I. 1)2 Dow filed a motion to dismiss on November 27, 2013 (D.I. 7), and
thereafter NOVA filed an amended complaint (D.I. 11).
As is set out in the amended complaint, the instant case was an independent suit alleging
serious misconduct against Dow and its attorneys. Specifically, NOVA alleged that Dow had
perpetrated a fraud on NOVA and on the Court in regard to standing to bring suit and
infringement, by knowingly presenting false and misleading testimony in the original suit. (See,
e.g.,
id.~
11)
2
Unless otherwise specified, docket citations in this opinion are to C.A. No. 13-1601.
1
NOVA presented two theories to the Court in support of its allegations. First, NOVA
argued that Dow never had standing because it did not own the patents-in-suit at the time of the
earlier lawsuit:
Dow, with the assistance of its in-house and outside
counsel, engaged in a deliberate scheme to interfere with and to
defraud the trial and appellate courts in their adjudication of the
Delaware Case on its merits. First, to convince the courts that it
had standing, Dow falsely denied that it had in 2002 transferred its
patents en masse (including its U.S. patents) to a subsidiary in a
state tax avoidance scheme. Dow fabricated the story that it had
generally withheld its U.S. patents from the transfer. To cover its
deceit, Dow deliberately hid material evidence regarding the
transfer ....
(Id.) NOVA alleged that testimony by Dow executive Mr. Valenzuela in unrelated tax litigation
in the Middle District of Louisiana disclosed that "all" of Dow's patents were, in fact, transferred
in 2002, and "[h]ad this Court been privy to these newly disclosed facts, it would have viewed
differently the 2002 Contribution Agreement between Dow and its subsidiary ... and would have
dismissed Dow's complaint in the Delaware Case for lack of standing." (Id.
if 15)
NOVA's second argument was directed toward the Court's finding of infringement in the
original action. NOVA alleged in the instant independent action in equity that, "[O]n the merits
· of the infringement claims, Dow presented expert testimony that was, on information and belief,
known to be false at the time it was given. The expert in question has admitted the true facts in a
more recent, related Canadian proceeding." (Id.
if 11)
Specifically, NOVA alleged that Dow's
expert Dr. Soares,
falsely represented to the jury in the Delaware Case that he had
successfully separated, and then measured, a 'Component B'
required by the claims. In fact, according to Dr. Soares'] recent
testimony in the Canadian Action, he knew contaminati
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