IP Law Daily, PATENT—W.D. Wis.: Patent acquisitions sire monopolization claims involving bull semen processing, (Jul 22, 2016)

By Greg Hammond, J.D.

A bull semen provider sufficiently alleged that a technology company’s acquisition of patents related to sexed-semen sorting technology was anticompetitive under the Sherman Act. The federal district court in Madison, Wisconsin, consequently denied the technology company’s motion for summary judgment on claims that the technology company monopolized and exercised market power in the "sexed bovine semen processing" market (ABS Global, Inc. v. Inguran, LLC, July 21, 2016, Conley, W.).

ABS Global, Inc., provides bull semen to dairy and beef producers for artificial insemination. Inguran, LLC, doing business as Sexing Technologies (ST), provides sorting technology services to ABS and other companies to separate male and female bull sperm. ABS claims that ST has monopolized and exercised market power in the alleged "Sexed Bovine Semen Processing Market," in violation of Section 2 of the Sherman Act, and that ST engaged in unfair competition through its patent acquisitions and licenses. ST counterclaimed, in part, that ABS infringed two U.S. patents owned by ST.

Anticompetitive conduct, patent acquisitions. ABS argued that ST’s acquisition of patents related to sexed semen sorting technology is anticompetitive under Section 2 of the Sherman Act as a matter of law. ABS claimed that: (1) ST acquired all four of the original patents-in-suit, but has still not made use of the "laser-kill" technology described in one of those patents; (2) ST sued another competitor on the acquired patents, along with nine others; and (3) ST secured an exclusive license in 2009, comprising 46 U.S. patents relating to sexed bovine semen processing, resulting in ST now either owning or having exclusive rights to a portfolio of 136 U.S. patents related to sexed semen processing, together with additional foreign counterpart patents. This was enough to suggest that ST’s acquisition of patents could qualify as unlawful under the Sherman Act, according to the court.

ST, however, claimed that its accumulation of patents concerning sexed semen technology is actually procompetitive. The court concluded that a reasonable jury could find that ST’s accumulation of patents related to sexed semen sorting technology was part of an unlawful effort to maintain its monopoly in violation of Section 2 of the Sherman Act. Because the court could not decide whether a violation of the Sherman Act occurred or not as a matter of law, both parties’ motions for summary judgment on the Sherman Act claims were denied.

Patent infringement. ABS’ motion for summary judgment of non-infringement on claims 3-6 and 9-10 was granted. The court first concluded that, because ST offered no evidence to contradict ABS’ assertions that the "Genus Sexed Semen" (GSS) technology does not change the sort strategy or fluid delivery rate based upon the sperm population being collected, summary judgment on non-infringement on claims 3 and 4 was proper.

With regard to claim 6, the court noted that ST offered no explanation of how the GSS technology could spare both single-cell and multi-cell sets of the desired sex, while destroying only single-cell and multi-cell sets of the undesired sex, or those cells of the undesired sex along with multi-cell sets of mixed sex cells, as is required by the language of claim 6. The court consequently granted summary judgment of non-infringement to ABS on claim 6.

The court also agreed with ABS that ST produced insufficient evidence to establish that the GSS technology adjusts the fluid-delivery rate based upon the purity or quantity of the population of collected sperm. Summary judgment of non-infringement on claims 9 and 10 in ABS’ favor was therefore appropriate.

The case is No. 14-cv-503-wmc.

Attorneys: David Timothy Pritikin (Sidley Austin LLP) and Michael J. Modl (Axley Brynelson, LLP) for ABS Global, Inc. Sarah Anne Zylstra (Boardman & Clark LLP) and Catherine Fairley Spillman (Akin Gump Strauss Hauer & Feld LLP) for Inguran, LLC.

Companies: ABS Global, Inc.; Inguran, LLC

Cases: Patent WisconsinNews