BYU Sues Pfizer

October 19, 2006 | 28 comments
By

This article was interesting. I’d be curious to hear what the bloggernacle’s resident legal experts have to say about this. To my knowledge (which I’m sure will take no more than eight comments to thoroughly debunk), it isn’t often that the Church or its entities sues someone.

28 Responses to BYU Sues Pfizer

  1. Mark B. on October 19, 2006 at 11:45 am

    Sorry if this comment pushes to nine the number needed to debunk your musing about how often the Church or its entities sue somebody, but . . . wouldn’t it be nice if BYU won the lawsuit, added several billion dollars to its endowment, and reduced significantly the subsidy it receives from the tithing revenues of the Church.

  2. Kevin Barney on October 19, 2006 at 11:52 am

    Huh…I thought it was well known that Simmons was instrumental in the science behind Celebrex. I wasn’t aware of this lingering dispute over the patents.

  3. Nate Oman on October 19, 2006 at 12:06 pm

    A couple of additional interesting facts:

    Pfizer is now getting sued all over the country (and world) based on Celebrex, the drug based on the COX-2 inhibitor. (Requiring hoards of science-phobic junior associates at Pfizer’s law firm to sit through endless meetings on the chemistry of NSAIDs, etc. etc. Indeed, it is bad enough that some of the associates have been driven out of practice altogether ;->)

    Pfizer’s chief litigation counsel is Sidley Austin LLP, Rex E. Lee’s old law firm that in the past has represented both the Church and — I believe — BYU.

    Kevin: As I understand it, there isn’t really a dispute about whether or not Simmons was insturmental in discovering the COX-2 inhibitors. Rather, the issues have to do with the subsequent contracts between Simmons/BYU and Pfizer, and the extent to which Simmons/BYU are also entitled to the proceeds of inventions subsequently developed by Pfizer under those contracts.

  4. Lisa M on October 19, 2006 at 12:14 pm

    I too am under the impression that the LDS Church does not enter into lawsuits, lightly. I also read that BYU\’s legal team as well as Leo Beus an attorny from AZ will be the team on this case.
    I am anxious to see how this unfolds.

  5. obi-wan on October 19, 2006 at 12:40 pm

    Sorry if this comment pushes to nine the number needed to debunk your musing about how often the Church or its entities sue somebody, but . . . wouldn’t it be nice if BYU won the lawsuit, added several billion dollars to its endowment, and reduced significantly the subsidy it receives from the tithing revenues of the Church.

    Dream on. Patent litigation, “the sport of kings,” is extremely expensive and uncertain. The more likely scenario: BYU spends $10-15 million in tithing funds on litigation costs, and settles seven or eight years from now for an undisclosed sum that covers its costs plus perhaps a few scholarships.

    Pfizer is now getting sued all over the country (and world) based on Celebrex, the drug based on the COX-2 inhibitor. (Requiring hoards of science-phobic junior associates at Pfizer’s law firm to sit through endless meetings on the chemistry of NSAIDs, etc.

    Obviously a mistake on Pfizer’s part, since there are available a large number of highly qualified patent litigation firms (Finnegan Henderson, Morrison & Foerster, Fish & Richardson, Covington, etc., etc.) where the associates already know the chemistry.

  6. Kevin Barney on October 19, 2006 at 1:16 pm

    Is there a liability risk in going after a piece of the Celebrex pie? Is it possible BYU is better off with Pfizer swearing up and down they had nothing to do with it? (Don’t know, just askin’.)

  7. David Brosnahan on October 19, 2006 at 1:57 pm

    I agree that there may be a silver lining here. Pfizer and Merk rightly get all the blame for Celebrex and Vioxx. However, the idea of selectively blocking COX-2 is not what causes heart attacks. Vioxx and Celebrex affect other receptors and mediators other than COX-2. Dr. Simmons discovered COX-2, he didn’t develop the exact chemicals made to inhibit it. Vioxx and Celebrex are being sued for knowing about the these heart side-effects and failing to notify consumers. Everyone in the science community knows that Dr. Simmons discovered COX-2. Monsanto thought they could take advantage of those poor naive mormons. Several NFL players I know have had considerable difficulty in contract negotiations because teams try similar tactics thinking they can take advantage of a couple naive mormons.

  8. tyler on October 19, 2006 at 5:05 pm

    I had begun to think BYU dropped this because they didn’t want to be part of the negative publicity involved in the Vioxx scandal. Drug companies in general, and those that have been aggressively marketing COX-2 inhibitors in particular, don’t have a very rep in the medical community right now since it now seems clear unnecessary deaths occurred as a result of use of these drugs. It would be kind of sad (but not really) for the drug companies if they lost on the one hand for marketing the drugs and on the other hand for pretending to discover something they really stole.

  9. jimbob on October 19, 2006 at 9:22 pm

    “The more likely scenario: BYU spends $10-15 million in tithing funds on litigation costs, and settles seven or eight years from now for an undisclosed sum that covers its costs plus perhaps a few scholarships.”

    That sounds like a no-risk, high-reward piece of litigation to me. If you’re pretty certain to get your fees back, then why not go for the $1B?

  10. WillF on October 20, 2006 at 12:06 am

    Can anyone explain how they determined the $1B claim? Was it just a nice round number?

  11. queuno on October 20, 2006 at 12:37 am

    “Pfizer, the firm who shagged me”
    “You need to sue for … one BILLion dollars!”

    Thanks, I’ll be here all night.

  12. N.G. on October 20, 2006 at 1:04 am

    The headline is a bit misleading…as the article points out toward the end, BYU isn’t suing for $1Billion. They’re suing and claiming that they’ve lost “substantially more than $1Billion,” but asking a jury to decide damages.

  13. BrianJ on October 20, 2006 at 1:46 am

    The University of Rochester, which had been awarded a patent for COX-2 inhibitors, lost its battle over Celebrex 1-2 years ago. BYU’s case is fundamentally different, so it will be interesting to see how it plays out. I wonder if BYU waited for the outcome of the U of R suit before filing this one.

    WillF, #10: the article Julie linked to explains the $1B figure.

  14. WillF on October 20, 2006 at 7:30 am

    I read the article, but I guess I wasn’t satisfied with the explanation it gave. I’m curious about the criteria BYU used to estimate that the “lost potential revenue is in excess of $1 billion.” For example, did they look at another blockbuster discovery by someone at another University and see how much revenue they collected, or what? I figured there might be some lawyers on here who might have an idea (or be willing to speculate – this is TandS is it not?)

  15. Mark B. on October 20, 2006 at 9:02 am

    I’m no patent lawyer, WillF, but my hunch is that they looked at Pfizer’s sales figures, applied the customary license fees to the total, and did the arithmetic. What Prof. Simmons did may have been rocket science, but calcuating the license fees isn’t.

  16. WillF on October 20, 2006 at 11:19 am

    The trib has a nice timeline in today’s article… http://www.sltrib.com/search/ci_4514647

  17. obi-wan on October 20, 2006 at 6:45 pm

    That sounds like a no-risk, high-reward piece of litigation to me. If you’re pretty certain to get your fees back, then why not go for the $1B?

    Because there is also a scenario where you eat your costs. Whether you have the stomach for this sort of thing depends a lot on risk aversion.

    Second, there are potential cash flow problems while the litigation drags on. This case may be as much about endurance as anything else, and I don’t get the impression that BYU has a lot of extra cash lying around. (Maybe the Church will front them from some other account?).

    And third, not to put too fine a point on the matter, but I would have some concern over whether an institution that lacks the sophistication to get the initial licensing right has the sophistication to get the litigation right. I won’t comment on the quality of their counsel, but ultimately, somebody has to tell counsel what the game plan is going to be.

  18. Jim Wallmann on October 20, 2006 at 10:57 pm

    About twenty years ago I was involved in the acquisition of a pipe organ for an LDS meetinghouse. The (non-LDS) organbuilder told me that the purchase order from the Church merely specified \”one pipe organ\” in describing the very expensive item to be delivered. To avoid any misunderstanding, the organbuilder confirmed exactly the type of instrument he was providing, but he told me that an unscrupulous vendor could take advantage of the Church\’s general description. He added that his experience with the Church was that the Church operated with vendors on the basis of mutual trust and that any vendor who took advantage of this trust would simply be cut off from doing business with the Church.

    Whether this same trusting approach characterizes the Church\’s current business relationships or BYU\’s dealings with Pfizer/Monsanto in 1991 I can\’t say. The story on BYU NewsNet (http://newsnet.byu.edu/story.cfm/61500) describes a \”research agreement\” from July 1991 between BYU and Monsanto. Whether BYU should have done more in 1991 is impossible to say without knowing all of the facts, but it appears to me that a good research agreement could easily have been sufficient for BYU at that time.

    I\’m also interested to read that BYU and Pfizer have mediated this dispute — obviously without success. This implies that each side knows the position and arguments of the other. BYU and Pfizer clearly reached an impasse. I\’ve not seen the complaint, but based on press reports, it appears that BYU is arguing that the spirit of the research agreement was breached, while Pfizer is saying it has complied with the letter of the agreement.

    I don\’t think this is at heart a patent case. It appears to be a garden-variety commercial dispute, albeit with lots of zeros and well-known litigants. The NewsNet story indicates that BYU is being represented by Leo Beus of Arizona. Mr. Beus appears to be an accomplished commercial litigator (not a patent litigator) with good LDS connections, but I don\’t know that he enjoys a national reputation. For a case filed in Utah, I\’m sure he\’ll do fine. In fact, a high-powered litigator from either coast may not play well in Utah anyway. The case has been assigned to Judge Dale Kimball, a BYU graduate.

    Finally, I\’m reminded of Philo Farnsworth\’s battles with RCA over the invention of television. Is there a trend here?

  19. Randolph Finder on October 21, 2006 at 8:05 am

    The funny thing is reading that article, that BYU is just a university, not the LDS university. The article could have been written identically if they had been talking about Cornell or Southern Methodist. (Probably not in the Deseret News though.)

  20. David Brosnahan on October 21, 2006 at 2:52 pm

    Having done graduate research at BYU Dept of Chem., I can attest to how unsophisticated and risk adversive BYU’s office of technology transfer was. BYU was an extremely difficult place to file a patent. According to Dr. Simmon’s, BYU told him, “you can’t patent a receptor!” However, they have since replaced people. BYU was not only naive but incompetent when it comes to the patent business. You had to have your invention already packaged with buyers ready to hand over money for it before they’d take you seriously.

  21. obi-wan on October 21, 2006 at 9:13 pm

    I don\\’t think this is at heart a patent case.

    According to the news article, they\’ve asked for correction of inventorship. If it\’s a section 256 claim, believe me, it\’s a patent case (and quite possibly statutorily impossible on the facts as they appear to have alleged them).

    The NewsNet story indicates that BYU is being represented by Leo Beus of Arizona. Mr. Beus appears to be an accomplished commercial litigator (not a patent litigator) with good LDS connections, but I don\\’t know that he enjoys a national reputation.

    This is, unfortunately, fairly standard operating procedure for the Church — they don\’t hire the best talent available; instead they hire from the LDS old boys network. Which is also why they have a tendency to lose big cases.

    For a case filed in Utah, I\\’m sure he\\’ll do fine. In fact, a high-powered litigator from either coast may not play well in Utah anyway.

    In a patent case, it\’s not the trial that matters, it\’s the appeal. Since he apparenlty doesn\’t really know what he\’s doing, there\’s a good chance for him to screw up the record and get creamed at the Federal Circuit.

    According to Dr. Simmon’s, BYU told him, “you can’t patent a receptor!�

    Ouch.

    However, they have since replaced people.

    See my comment above about the old boys network.

  22. grego on October 21, 2006 at 11:20 pm

    If BYU were to win, perhaps they could take some of that $1Billion and build a small-scale replica of the WTC towers, reenact the scenario, and have a solution to the Professor Jones problem… (That would also seem to certainly be front-page news all over the world. :) )

  23. jimbob on October 26, 2006 at 11:28 am

    “Because there is also a scenario where you eat your costs. Whether you have the stomach for this sort of thing depends a lot on risk aversion.”

    Well now you’re describing litigation generally. Is there something about this type of case that makes it more of a gamble? Inexperience of the judiciary, for example? Having read the article, I think BYU seems to have a pretty decent case.

  24. Scott on May 23, 2007 at 4:52 pm

    Finally! One of my BYU teachers was FURIOUS about this and all the money we got screwed over on. But he was equally angry at the STUPID lawyers we had at BYU at the time, who simply could not even understand great discoveries. Had he still been at Harvard, where the lawyers are used to fighting for their research, it wouldn\’t have been a problem. I am so glad to see this happening, even though I hate litigation, Monsanto is a liar, thief, and a fraud.

  25. Mar on December 23, 2007 at 7:22 pm

    My family has been in a lawsuit with BYU for over 10 years. Despite numerous attempts to settle, BYU has pushed it to the Supreme Court. The Supreme Court ruled against BYU, but to our surprise, BYU initiated a new suit, with slightly different details than the first. We have met with LDS officials, BYU officials, written letters and pleaded to bring the conflict to a close, all to no avail. The thought that BYU could be involved in an unjust lawsuit is obviously beyond the minds of everyone witassociated with them.

    We are LDS, and struggle constantly with the stigma that BYU (the LDS school) is trying to destroy our family, yet we continue steadfast in our LDS convictions, with a prayer that our tithing money somehow does NOT pay to fuel the suit against us.

    So while it may be true that they are slow to enter a lawsuit, if they find themselves 10 years and millions invested into a lawsuit it is not likely they will EVER back down or settle,..even when the Supreme Court rules that they were wrong.

    The public exposure of this will be coming soon. We\’ve been quiet for too long, and have taken a harsh beating from our own religious institution. The only thing left is public awareness.

  26. Blake on December 23, 2007 at 8:11 pm

    Interesting Mar, since I am not aware of a BYU Supreme Court case lately. Care to let us in on the name of the case?

  27. Matt Evans on December 24, 2007 at 2:08 am

    “The Supreme Court ruled against BYU . . . public exposure of this will be coming soon.”

    Mar, because Supreme Court rulings are immediately made public, at least one of these two statements is false.

  28. Marc on December 24, 2007 at 3:54 pm

    Odd… the Utah Supreme Court? Was it actually BYU or an instrumentality of it? I’m with Matt and Blake in thinking that this sounds a little suspicious.

WELCOME

Times and Seasons is a place to gather and discuss ideas of interest to faithful Latter-day Saints.