SinoMab BioScience Limited v. Immunomedics, Inc., No. 2471-VCS (Del. Ch., June 16, 2009), read opinion here.


This 50-page Chancery Court decision addresses in great detail the intellectual property rights involved in patent disputes between a biopharmaceutical company and its former employee. I will merely highlight the issues addressed in this case because the court applies New Jersey law to all the legal issues and thus the core of this decision is outside the scope of this blog which of course is obsessed with Delaware corporate and commercial law. This opinion reads in some respects like a science textbook and discusses in excruciating detail the minutiae of the scientific aspects of the patent dispute including such things as DNA sequence and other very technical scientific terminology and processes regarding the biotechnology involved. The main reason why I include this case, however cursorily, is because it is an indication of the types of intellectual property and patent related disputes that the Chancery Court handles.

Issues Addressed

The issues that were decided based on New Jersey law should be of interest generally to any business that employs highly trained and highly educated individuals who develop patents or other intellectual property during the course of their employment. The issues discussed and decided by the Delaware Chancery Court, applying New Jersey law, include the following: (i) the enforceability of restrictive covenants; (ii) misappropriation of trade secrets; (iii) implied covenant of good faith and fair dealing; (iv) the law of unfair competition.

Of great interest to most employers who attempt to confirm their ownership of intellectual property developed by their employees, will be the court’s finding in this case that:  a very sophisticated biotechnology patentable discovery was developed after the employee left the company–despite a presumption, pursuant to a written agreement, that any patent developed within one year after the termination of employment belonged to the employer.

UPDATE: Here is a two-page letter decision of July 10, 2009 that decides the amount of fees awarded for defending only one of the claims in the case–that was abandoned in June 2007 (two years prior to this recent opinion.) The court granted fees of 20% of the fees incurred up until that point of the abandoned claim.