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Judge Robinson denies motion to dismiss based on covenant not to sue

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In Gevo, Inc. v. Butamax Advanced Biofuels LLC, et al., C.A. Nos. 12-301-SLR, 12-448-SLR (D. Del. Dec. 16, 2013), Judge Robinson denied plaintiff’s motion to dismiss Butamax Advanced Biofuel LLC’s (“defendant”) counterclaims of invalidity and non-infringement based on plaintiff’s covenant not to sue. The covenant not to sue provided that plaintiff would not sue “for the use of ‘Accused Technology,’ defined as certain modified recombinant organisms.” Id. at 2. Judge Robinson explained that because plaintiff was willing to dismiss its infringement claims, and only defendant’s counterclaims would remain, the case would transform into a declaratory judgment action. Id. at 3 n.2.

Under the totality of the circumstances, Judge Robinson found an actual controversy between the parties to exist and denied plaintiff’s motion to dismiss, citing to “the pattern of litigation between the parties[,] . . . the unpredictability of the art,” and the defendant’s “desire to use the alleged infringing strains.” Id. at 5. Specifically, Judge Robinson noted that there are “eleven cases pending between the parties,” which are “direct competitors and are in a race to develop bio-isobutanol technology.” Id. at 4. Further, as Judge Robinson explained, “the covenant not to sue casts a cloud over [defendant’s] research efforts,” noting that the parties “already disagree[d] “on how to interpret ‘Accused Technologies’ in the covenant not to sue.” Id. at 4 & n.5.That is, there was disagreement on whether the covenant covered “future commercial strains” with a “different genetic background.” Id. at 4. Judge Robinson additionally noted that defendant stated “that it will likely resume using the alleged infringing strains if the litigation is resolved in its favor.” Id.

While a “justiciable controversy” was found in these “unusual circumstances,” Judge Robinson did not intend the “memorandum to commend [defendant’s] decision to oppose dismissal or the parties’ inability to find a non-litigation oriented means to pursue their technology interests.” Id. at 5 & n.6.

Gevo, Inc. v. Butamax Advanced Biofuels LLC, et al., C.A. Nos. 12-301-SLR, 12-448-SLR (D. Del. Dec. 16, 201…

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