Coatings giant AkzoNobel has filed suit against Dow Chemical Co., accusing the raw materials maker of misusing confidential information gained from a partnership to apply unilaterally for two coatings patents.
AkzoNobel says the patent actions by subsidiary Dow Advanced Materials violate the 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.
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.
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.
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 Friday (July 5) 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.