Gevo a winner? Not the issue, says Butamax, as the Capulets and Montagues get it on again.
It’s a tennis match in which the score is never love.
Scene: Verona. A public place.
The Prince: Three civil brawls, bred of an airy word,
By thee, old Butamax, and Gevo,
Have thrice disturb’d the quiet of our streets,
And made the Digest’s ancient citizens setteth aside
required reading of matters thermochem and RFS,
to hear again, and again, and thence again
your claims and counterclaims and all the pleadings
that issueth, containing more commas than there are microbes under heaven.
This case shall confuseth us most relentlessly,
until we rent our clothes and throweth ourselves
into vats of isobutanol and drinketh thereof
until, verily, we goeth mad and blind.
In Delaware, the United States District Court for the District of Delaware entered a final judgment in favor of Gevo (GEVO) and against Butamax Advanced Biofuels, LLC (Butamax), a 50/50 joint venture between DuPont (DD) and BP, ending the trial court proceedings on Butamax’s Patent Nos. 7,851,188 (’188 Patent) and 7,993,889 (’889 Patent).
For those newer to the saga, Butamax and Gevo both make isobutanol, using modified microorganisms and employing a separation technology to part the butanol from the broth.
It is not entirely clear who owns what rights, and there has been an awful lot of suing going on.
“This is a huge victory for Gevo and our shareholders,” noted Patrick Gruber, Ph.D., Gevo’s chief executive officer.
Over to Butamax
There was substantially less cheering over on Planet Butamax.
Butamax spokesman Mark Buse said, “As we previously stated, Butamax strongly disagrees with the Court’s claim construction and decided instead of going to trial decided to appeal the case immediately. This issue was decided two weeks ago.”
Gevo general counsel Brett Lund was incredulous. “Instead of going to trial? You don’t get to skip a trial. You lose.”
Butamax wasn’t buying any of that.
“The only real news today,” said Buse, “is that the Patent office has dealt a huge blow to Gevo, by issuing an Action Closing Prosecution rejecting all claims from their so called landmark GIFT patent. ”
From the ruling
From Judge Sue L. Robinson: “It is hereby ordered and adjudged this 10th day of April 2013 that final judgment be and hereby is entered in favor of Defendant Gevo, Inc. and against Plaintiff Butamax Advance Biofuels, LLC with respect to the claims relating to ’188 and ’889 Patents.”
Final judgement? We are afraid not.
The press release flurry
In a release, Butamax set forth its argument.
On April 10, 2013, the United States Patent and Trademark Office (“USPTO”) issued an Action Closing Prosecution (“ACP”), rejecting all claims of Gevo Inc.’s U.S. Patent No. 8,101,808 (“‘808 patent”), in the inter partes reexamination filed by Butamax on May 7, 2012. The ‘808 patent was described by Gevo as “a landmark patent … on its GIFT® separation unit, a central element in the Company’s unique fermentation technology”.
“The significance of this ACP is that the Patent Reexamination Specialist responsible has now heard both sides of the argument with respect to this patent, and has concluded that all of the original, amended and added claims are unpatentable.
“In making this decision, the USPTO adopted all prior art grounds for unpatentability cited by Butamax against both the originally issued claims and the claims Gevo amended and added during the proceedings. These included the claims for both Gevo’s GIFT® system, as well as all claims purported to cover Butamax’s technology. The USPTO also rejected Gevo’s claims related to retrofit of an ethanol plant, which was already known due to prior disclosures from BP and DuPont.
Gevo responds post-haste
The Examiner’s decision, which dismissed 110 previous grounds of rejection and introduced a limited number of new rejections, is a non-final action called an Action Closing Prosecution (ACP), and gives Gevo the opportunity to respond to the limited new questions raised by the USPTO Examiner. During this period of review, the ’808 Patent remains valid and fully enforceable during the reexamination process.
“Importantly, Gevo was successful in eliminating all of the previous 110 rejections presented in the first office action and the minimal number of new rejections are based on obviousness as opposed to novelty.” said Brett Lund, Gevo’s executive vice president and general counsel.
The bottom line
You have three main lines of gravity here.
1. The Butamax vs Gevo suit. Butamax is going to appeal the decision just handed down today. That could take (easily) more than a year to work its way through the courts.
2. The first Gevo vs Butamax suit. Gevo is suing Butamax for infringing the ’808 Patent. This case is scheduled to go to trial in the US District Court of Delaware in July of 2014.
3. The second Gevo vs Butamax suit. Gevo is suing Butamax for infringing the ’375 and ’376 Patents. This case is scheduled to go to trial in the US District Court of Delaware in August of 2014.
So – with the loser likely to appeal, all of these three cases could drag for years. And, more suits may be filed in the future based on new patents.
It tells you one thing. For sure, the owners of both these technologies see massive value in them – enough to undertake the costly and debilitating legal parry and thrust.
The best news, then? Someone is going to end up owning these technologies and drivers and chemists will all stand to benefit from isobutanol’s attractive properties and what we expect will be good prices for the customer and great margins for the owners.