EDITORIAL: BIOTECHS, THE LAW AND MATTERS OF PRINCIPLE
July 13th 2009 02:46
Thursday June 18, 2009
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* EDITORIAL: BIOTECHS, THE LAW AND MATTERS OF PRINCIPLE
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EDITORIAL: BIOTECHS, THE LAW AND MATTERS OF PRINCIPLE
Anyone with any significant exposure to the law and especially commercial law will know that we have the best legal system money can buy.
That is, whoever can afford to keep appealing to the higher courts is likely to win the poker game – unless both go all the way to the Full Bench of the High Court or in the UK the Law Lords, in which case, anything can happen and generally does.
Fighting a matter of law or using the legal system to achieve a commercial end is very different to fighting ‘a matter of principle’.
In matters of principle, human emotions become entangled with probable legal outcomes. Decisions are not objective. People say silly things like: “I’m going to teach them a lesson” or “They can’t be allowed to get away with that”. But one can only use the legal system to teach other people lessons or prevent them doing things if one has a reservoir of cash.
A family law barrister once told Biotech Daily that his hardest task was explaining to litigants that unless they were fighting over $2 million it wasn’t worth coming to him, because $200,000 would go in legal costs. In some cases it is cheaper to give the other side 80 percent rather than go to court for a 50-50 split.
Yesterday’s publication of the New South Wales Supreme Court judgment against Fermiscan, in favor of inventor Prof Veronica James is merely the most recent of legal actions that never should have begun.
Justice Robert McDougall’s judgment is a damning indictment of Fermiscan’s decision-making.
Click here for Justice McDougall's decision
One claim against the inventor of their technology was that she disparaged the company. The judgment says Prof James did point to criticisms of the x-ray diffraction test of hair to detect breast cancer, but she did so by relying on Fermiscan’s own published documents.
That Fermiscan managed to have Prof James agree to a $700,000 penalty should she ever disparage the company in settlement of a previous Federal Court case is breath-taking. Justice McDougall said this penalty was not enforceable.
Justice McDougall also dismissed the Fermiscan claim that Prof James patents on detecting cancer from skin and nail was merely “an improvement” on the earlier hair test, citing that most authoritative document, the Australian Oxford Dictionary.
The proof that this legal action has been counter-productive is that all of Fermiscan’s documentation and criticisms of its own technology are now in the public realm.
Fermiscan will appeal the decision, scheduled for August 5, 2009, meaning they believe that there has been a technical error by Justice McDougall in arriving at his judgment.
But Fermiscan is not alone in this pursuit of principle.
Biotech Daily has reported on the reciprocal case of the inventor taking on the company as Sirtex former chairman Dr Bruce Gray uses his 30 percent holding to call meetings to oust the Sirtex board. It is Biotech Daily’s view that Dr Gray would find it far more profitable to leave the board and management to get on with work, rather than providing never-ending distractions, which cannot possibly assist in improving Sirtex’s share price.
Finally, Biotech Daily mentions in passing only that Biota investors were short-changed by $55 million when, acting on a matter of principle, that company’s previous board knocked back an offer of $75 million from Glaxosmithkline to settle the Relenza matter, later accepting $20 million, which was insufficient to cover legal costs.
As one respected litigator said of an English case she had just been given, rubbing her hands together with a glint in her eye mocking an avaricious shopkeeper: “Oooh goody, a matter of principle.”
The answer is simple really. If you have a matter of principle, don’t go to court.
David Langsam
Editor
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