A California court has rejected an appeal from Delano Farms and Four Star Fruit that sought to overturn a ruling on the United States Department of Agriculture's (USDA) patent rights for two grape varieties - Scarlet Royal and Autumn King.
The two companies, along with Gerawan Farming, had lost a case against the USDA and the California Table Grape Commission (CTGC) in late 2013 where they had argued the patents were invalid as the cultivars had been in "public use" before a patent application was made.
To successfully make such a claim, it must be proven that the invention was in public use a year before this application, and in this case the "critical date" was established as Sept. 28, 2003.
The saga began in 2001 when USDA employee Rodney Klassen promised to give plant material from the varieties to grower Jim Ludy of J&J Farms, even though he did not have authorization to do so.
After grafting the fruit to his own vines, the grower then passed the material on to his cousin Larry Ludy and both of them ended up selling the grapes as "Thompson Seedless" through marketer Richard Sandrini. However, the grapes were sold after the critical date.
The appellants emphasized that in previous cases the third-party use of inventions had invalidated patents when no attempt to maintain confidentiality was made.
"As evidence of the Ludy's lack of effort to maintain secrecy regarding their possession of the Scarlet Royal and Autumn King varieties, the appellants point to Jim Ludy's provision of plants to Larry Ludy, Larry Ludy's sharing of information with Mr. Sandrini, and the lack of concealment of the vines at either of the Ludy's farms," said Judge Sam E. Haddon.
"Although the inventor of the plant varieties in this case did not give or sell the invention to anyone, Jim Ludy obtained control over the unreleased varieties. The appellants argue that for purposes of the public use doctrine, Jim Ludy therefore stands in place of the inventor.
"The problem with the appellants' argument is that it is squarely contrary to the district court's findings of fact. Larry Judy was present during and participated in Jim Ludy's conversation with Mr. Klassen and knew that Mr. Klassen did not have the authority to provide the Ludys with unreleased varieties."
To weigh in against the public use claim, Haddon added Sandrini could not "practice the inventions" as he did not have plant material until after the critical date. Previously, the district court argued that the Ludys and Sandrini created an "environment of confidentiality".
"We have no reason to overturn these findings. Based on the district court's findings and our case law, the Ludys' disclosure to Mr. Sandrini that they were in possession of the unreleased plants does not qualify as an invalidating public use of the patented plant varieties."