Monthly Archives: October 2012

Spoliation Ruling Upheld in Mushroom Litigation

On October 22, 2012, the District Court in the Mushroom Direct Purchaser Antitrust Litigation overruled objections to an adverse inference sanction that had been ordered against a defendant for spoliation of documents. The sanction was ordered in August 2012 by Magistrate Judge Rice against defendant M.D. Basciani and Sons, Inc. (“MDB”), and a related non-defendant, Basciani Foods, Inc. (“BFI”).  Judge Rice found in his August 2012 order that MDB had suppressed relevant documents within its control at BFI after it was reasonably foreseeable that the plaintiffs would seek the documents in discovery.  Judge Rice ordered that a sufficient sanction required an adverse inference instruction allowing the jury to find that the destroyed documents would have been unfavorable to defendant MDB.  MDB and BFI thereafter objected to the District Judge that MDB did not exercise sufficient control over BFI to make MDB liable for BFI’s destruction of relevant documents.  In his October 22, 2012 Memorandum overruling the objection, District Judge O’Neill cited thirty years of case law, reaching back to a 1979 opinion in the Uranium Antitrust Litigation, for the rule that “control” in the context of document production is broadly interpreted and fact specific.  Judge O’Neill concluded that Magistrate Judge Rice’s determination that MDB exercised such control and his decision to impose an adverse inference instruction as a sanction for destruction of the documents in question was neither clearly erroneous nor contrary to law and thus could not properly be overruled.  

Judge O’Neill in his 10/22/12 Memorandum also overruled objections by MDB and/or BFI to Judge Rice’s decisions not to sanction former class representatives and certain of plaintiffs’ counsel, and to enter a protective order forbidding the depositions of plaintiffs’ counsel; and to Judge Rice’s non-disposition of BFI’s motion to hold the plaintiffs in contempt for a claimed violation of a document copying order.

Supreme Court Grants Certiorari in Genetic Seed Patent Case

On October 5, 2012, the United States Supreme Court granted certiorari in Bowman v. Monsanto Co. (Sup. Ct. Dkt. No. 11-796).  The Bowman case,  657 F.3d 1341 (Fed. Cir. 2011), and then-pending petition for certiorari were discussed by Professor Daryl Lim in his excellent article on transgenic seeds and the antitrust-patent interface, ” Rebooting the Bean,” which appears in the Agriculture and Food Committee’s Fall 2012 newsletter.  Vernon Bowman, an Indiana soybean farmer, was successfully sued for patent infringement after he saved and planted the progeny seeds from a crop that he had grown from undifferentiated seeds — some containing patented traits and others that did not — that he had purchased from a grain elevator that had imposed no restrictions on Bowman’s use of the seeds.  Bowman’s petition for certiorari asked the Supreme Court to consider two issues:  

“‘[w]hether the Federal Circuit erred by (1) refusing to find patent exhaustion in patented seeds even after an authorized sale, and by (2) creating an exception to the doctrine of patent exhaustion for self-replicating technologies?'”  Professor Lim’s article observed that:  “The Bowman case has been identified as one of the most important patent cases before the Supreme Court.  One reason for this is that the Federal Circuit’s holdings [in Bowman] were not merely confined to transgenic seeds but implicate the universe of self-replicating genetic technologies.”