DCT

1:10-cv-00274

BASF Agro BV Arnhem NL Wadenswil Branch v. Cheminova Inc

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Key Events
Amended Complaint

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 1:10-cv-00274, M.D.N.C., 10/15/2010
  • Venue Allegations: Venue is alleged to be proper based on Defendant Cheminova, Inc.'s principal place of business in Research Triangle Park, North Carolina, which is within the Middle District of North Carolina.
  • Core Dispute: Plaintiffs allege that Defendant’s planned sale of Fipronil-based products will infringe patents related to specific methods of using Fipronil for pest control and processes for manufacturing the chemical itself.
  • Technical Context: The dispute is in the agrochemical field, concerning the widely used insecticide Fipronil, which is the active ingredient in leading termiticide and animal health products.
  • Key Procedural History: The complaint alleges that Defendant's activities are timed to coincide with the August 3, 2010 expiration of a patent covering the Fipronil compound itself (U.S. Patent No. 5,232,940), which Plaintiffs frame as a "pretext" for infringing the asserted method-of-use and process patents. The complaint also details pre-suit communications in March 2010, including an alleged threat by a Cheminova executive to "invalidate" Plaintiffs' patents unless a license was granted.

Case Timeline

Date Event
1996-11-29 Earliest Priority Date for ’010 and ’743 Patents
1999-10-22 Earliest Priority Date for ’943 and ’848 Patents
2002-07-02 ’010 Patent Issue Date
2003-09-16 ’943 Patent Issue Date
2004-12-28 ’743 Patent Issue Date
2005-04-19 ’848 Patent Issue Date
2009-12-16 Cheminova enters Fipronil-supply agreement with third parties
Early 2010 Cheminova submits petitions to EPA to register Fipronil products
2010-03-17 Cheminova executive calls BASF, allegedly threatening litigation
2010-03-24 Cheminova patent manager leaves voicemail for BASF counsel
2010-03-29 Cheminova patent manager emails BASF counsel
2010-08-03 '940 Fipronil compound patent expires
Early Aug 2010 Alleged start of Cheminova's infringing activities
2010-08-30 Third-party animal health companies sue Cheminova over supply contract
2010-10-15 Amended Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 6,414,010 - "Pesticidal Pyrazoles and Derivatives," issued July 2, 2002

The Invention Explained

  • Problem Addressed: The patent describes conventional termite treatments as creating a chemical "barrier" around a house, but notes that "loopholes in the treatment may cause failure of protection" (’010 Patent, col. 1:10-14).
  • The Patented Solution: The invention is a process for protecting a building by applying a non-repellent, slow-acting insecticide at "discrete locations" rather than in a continuous barrier (’010 Patent, col. 1:50-53). Because the insecticide is not a repellent and does not kill instantly, termites cross the treated zones, become "carriers," and transfer the poison back to the nest, resulting in a "secondary killing effect" that can eliminate the colony (’010 Patent, col. 1:60-65).
  • Technical Importance: This method allows for effective termite control using significantly less insecticide than traditional barrier treatments and without needing to know the precise location of termite activity (Compl. ¶10).

Key Claims at a Glance

  • The complaint asserts infringement of "one or more claims" of the ’010 patent (Compl. ¶48).
  • Independent Claim 1 requires:
    • A process for protecting a building.
    • Forming a solution or suspension of an insecticidally active ingredient that has "no quick knock down effect and a secondary killing action."
    • Applying the solution to "discrete locations" around or under the building to form "treated and untreated locations" along the perimeter.
    • The treated locations must make up a specific portion of the total perimeter ("0.5 to 7.5 meter per 10 meter").
    • The active ingredient is an insecticide of a specific chemical structure (formula I), which includes Fipronil.

U.S. Patent No. 6,835,743 - "Pesticidal Pyrazoles and Derivatives," issued December 28, 2004

The Invention Explained

  • Problem Addressed: As a divisional of the application that led to the ’010 patent, the ’743 patent addresses the same technical problem: the fallibility and high chemical volume of conventional termite barrier treatments (’743 Patent, col. 1:11-15).
  • The Patented Solution: The patent describes the same solution as the ’010 patent: a process using a non-repellent, slow-acting insecticide applied at "discrete locations" to leverage the "secondary killing effect" and achieve colony control with reduced chemical usage (’743 Patent, Abstract; col. 1:51-65).
  • Technical Importance: The invention provides a more targeted and less chemically intensive method for termite control compared to the prior art of continuous barrier applications (Compl. ¶12).

Key Claims at a Glance

  • The complaint asserts infringement of "one or more claims" of the ’743 patent (Compl. ¶53).
  • Independent Claim 1 is substantially similar to Claim 1 of the ’010 patent, requiring:
    • A process for protecting a building.
    • Using an active ingredient with "no quick knock down effect and a secondary killing action."
    • Applying the ingredient to "discrete locations" resulting in a specific ratio of treated-to-untreated perimeter ("0.5 to 7.5 meter per 10 meter").
    • The active ingredient must be a compound of formula (I).

U.S. Patent No. 6,620,943 - "Process For Preparing 4-Trifluoromethylsulfinylpyrazole Derivative," issued September 16, 2003 (Multi-Patent Capsule)

Technology Synopsis

This patent addresses challenges in the chemical manufacturing of Fipronil. Specifically, it discloses an improved process for the oxidation of a Fipronil precursor (a trifluoromethylthio compound) into Fipronil (a trifluoromethylsulfinyl compound). The invention uses trifluoroperacetic acid as the oxidizing agent in the presence of a corrosion-inhibiting compound, such as boric acid, to prevent damage to industrial reaction vessels and improve yield and selectivity (’943 Patent, Abstract; col. 1:49-56).

Asserted Claims

The complaint alleges infringement of "one or more claims" (Compl. ¶58).

Accused Features

The complaint alleges that Cheminova infringes by importing, selling, or offering to sell Fipronil technical material that was manufactured abroad using the patented process, an act of infringement under 35 U.S.C. § 271(g) (Compl. ¶31).

U.S. Patent No. 6,881,848 - "Process For Preparing 4-Trifluoromethylsulfinylpyrazole Derivative," issued April 19, 2005 (Multi-Patent Capsule)

Technology Synopsis

As a divisional of the application leading to the ’943 patent, this patent also relates to improved and more economical processes for manufacturing Fipronil and its chemical intermediates. The complaint states the ’848 patent "teaches and claims the final steps in processes to make Fipronil" (’848 Patent, Abstract; Compl. ¶16).

Asserted Claims

The complaint alleges infringement of "one or more claims" (Compl. ¶63).

Accused Features

The accused instrumentality is Fipronil technical material allegedly made by the patented process and subsequently imported into or sold in the U.S. by Cheminova (Compl. ¶31).

III. The Accused Instrumentality

Product Identification

  • The accused instrumentalities are "Fipronil technical material" and "Fipronil-based products" that Cheminova sells, uses, or offers for sale (Compl. ¶29).

Functionality and Market Context

  • The "Fipronil technical material" is the active chemical ingredient allegedly manufactured by processes covered by the ’943 and ’848 patents (Compl. ¶31).
  • The "Fipronil-based products" are formulations containing this active ingredient. The complaint alleges that Cheminova knows and intends for its customers to apply these products for termite control using methods that infringe the ’010 and ’743 patents (Compl. ¶32).
  • The complaint alleges that Cheminova is launching these as "generic products" to compete with Plaintiffs' Fipronil-based products (e.g., Termidor®) following the expiration of the basic compound patent for Fipronil (Compl. ¶30, ¶43).

IV. Analysis of Infringement Allegations

'010 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
a) forming a solution or suspension of an insecticidally active ingredient in a liquid... wherein the active ingredient has no quick knock down effect and a secondary killing action; The accused products contain Fipronil, which the complaint describes as a "slow-acting insecticide" that allows termites to become "carriers," ensuring transfer to other termites in the colony. ¶23 col. 1:55-65
b) forming treated and untreated locations along the perimeter of the building by applying an effective amount of said solution or suspension to discrete locations around or under said building... Cheminova allegedly intends for its customers to apply its Fipronil-based products using the patented method, which is described as being embodied in BASF's own "PerimeterPlus" treatment method. ¶24, ¶32 col. 5:50-60
wherein the combination of said treated locations and said untreated locations along the perimeter of the building equal the total perimeter of the building and further wherein said treated locations make up 0.5 to 7.5 meter per 10 meter of the total perimeter of the building... The complaint alleges that the methods covered by the ’010 patent will be used by Cheminova's customers, which implies this specific application ratio will be met. ¶24, ¶32 col. 6:1-5
and said active ingredient is an insecticide of the formula (I). The active ingredient is Fipronil, which the patent identifies as a preferred compound of formula (I). ¶10 col. 2:64-65

'743 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
a) forming a solution or suspension of an insecticidally active ingredient in a liquid... wherein the active ingredient has no quick knock down effect and a secondary killing action; The accused products use Fipronil, a "slow-acting" and "undetectable" insecticide that facilitates a secondary killing effect through transfer within the termite colony. ¶23 col. 2:60-65
b) forming treated and untreated locations along the perimeter of the building by applying an effective amount of said solution or suspension to discrete locations around or under said building... End-users of Cheminova's products will allegedly apply them at discrete locations, infringing the claimed method. ¶32 col. 5:56-65
wherein the combination of said treated locations and said untreated locations along the perimeter of the building equal the total perimeter of the building and further wherein said treated locations make up 0.5 to 7.5 meter per 10 meter of the total perimeter of the building... The complaint alleges that end-users will apply the accused products using the methods covered by the ’743 patent, which includes this specific application density. ¶24, ¶32 col. 6:6-12
and said active ingredient is an insecticide of the formula (I). The insecticide used in the accused products is Fipronil, which falls within the chemical structure of formula (I). ¶12 col. 2:50-53
  • Identified Points of Contention:
    • Scope Questions: For the ’010 and ’743 patents, a central question will be whether Cheminova's product labels, instructions, or marketing materials direct users to apply the product in a manner that meets the specific claim limitation of "0.5 to 7.5 meter per 10 meter of the total perimeter." The infringement case appears to rest on inducing this specific action, which may present an evidentiary challenge.
    • Technical Questions: For the ’943 and ’848 process patents, the dispute raises a significant evidentiary question: what proof can Plaintiffs obtain to demonstrate that the Fipronil technical material imported by Cheminova from foreign sources was, in fact, manufactured using the specific chemical steps, reagents (e.g., boric acid), and conditions required by the asserted claims?

No probative visual evidence provided in complaint.

V. Key Claim Terms for Construction

  • The Term: "discrete locations" (’010 Patent, Claim 1; ’743 Patent, Claim 1)

    • Context and Importance: This term is fundamental to distinguishing the patented method from a conventional, continuous chemical barrier. The definition of what constitutes "discrete" will be critical to determining infringement, as Defendant may argue its product is intended for a different application pattern.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The patent specification repeatedly uses the general phrase "spread around or under the said building at discrete locations" without further restriction, which may support a broad definition covering any non-continuous application (’010 Patent, Abstract).
      • Evidence for a Narrower Interpretation: Example 1 of the ’010 patent describes a specific embodiment where the compound is applied "at the location of the future corners of the house and at the crossing of the walls" (’010 Patent, col. 4:24-27). A party could argue this example narrows the term to a more structured, pre-defined set of points rather than any arbitrary set of separate locations.

  • The Term: "secondary killing action" (’010 Patent, Claim 1; ’743 Patent, Claim 1)

    • Context and Importance: This functional language defines a required characteristic of the insecticide. Practitioners may focus on this term because the dispute could involve the degree or efficacy of this action required to meet the claim, and whether the accused generic Fipronil formulation performs this function as claimed.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The specification provides a general definition as "an action of killing insects which have not been directly treated by mean of the said insecticide" (’010 Patent, col. 1:61-63). This could be interpreted broadly to cover any transfer-kill effect.
      • Evidence for a Narrower Interpretation: The specification further elaborates that preferred insecticides are those "able to kill the termites of the termites nest when brought back by treated termites" (’010 Patent, col. 1:64-65). A party might argue this requires proof of a specific level of colony-wide efficacy, not just incidental killing of a few untreated insects.

VI. Other Allegations

  • Indirect Infringement: The complaint heavily relies on allegations of indirect infringement. It alleges induced infringement by asserting that Cheminova sells its Fipronil-based products "knowing and intending that its customers or the end-users of its customers will apply" them using the methods claimed in the ’010 and ’743 patents (Compl. ¶32). For the ’943 and ’848 patents, the infringement claim is based on the importation of a product made by a patented process under 35 U.S.C. § 271(g) (Compl. ¶31).
  • Willful Infringement: The complaint alleges willfulness based on pre-suit knowledge of the patents. It specifically cites a March 17, 2010 phone call where a Cheminova president allegedly stated the company would attempt to "invalidate" the ’010 and ’743 patents unless BASF agreed to a license, and an email from a Cheminova patent manager acknowledging that the company was "looking into the business of Fipronil in the US" (Compl. ¶34-¶35).

VII. Analyst’s Conclusion: Key Questions for the Case

  • A core issue for the ’010 and ’743 method-of-use patents will be one of proof of inducement: can Plaintiffs produce sufficient evidence (such as product labels, user manuals, or marketing materials) demonstrating that Cheminova took affirmative steps to instruct or encourage its customers to apply the accused Fipronil products in the specific "discrete locations" pattern, and at the particular application density, required by the asserted claims?
  • A key evidentiary question for the ’943 and ’848 process patents will be one of extraterritorial proof: will Plaintiffs be able to establish, through discovery of Cheminova's foreign manufacturing operations, that the imported Fipronil was in fact produced using the specific chemical processes claimed in those patents, as required for infringement under 35 U.S.C. § 271(g)?
  • A central legal question will be the basis for declaratory judgment: does Cheminova's alleged conduct, including securing EPA registrations and soliciting customers prior to large-scale sales, constitute "meaningful preparations" that create a sufficiently immediate controversy to support a declaratory judgment of infringement, particularly for patents where infringement depends on the future actions of third-party end-users?