Pennsylvania Record

Wednesday, September 18, 2019

Superior Court upholds judgment to dismiss pharmaceutical patent suit

By Glenn Minnis | May 3, 2017

PHILADELPHIA — The Pennsylvania Superior Court recently upheld a lower court’s judgment in a licensing agreement dispute between a pharmaceutical company and the creators of a drug technology.

A panel ruled on April 3 that Mutual Pharmaceutical cannot legally reinstitute its suit against "liquisolid" technology developers Hygrosol Pharmaceutical based on the company once being embroiled in a separate legal action that challenged ownership of the patent.

Mutual had sought to void its nearly 20-year-old agreement with Hygrosol on those grounds, arguing that any contract between the two would be invalid based on those circumstances.

In rendering its decision, the court articulated that although Hygrosol officials surrendered their ownership rights to the liquisolid technology, which assists with the solubility of certain drugs, as part of a separate settlement hammered out two years ago, the agreement the company entered into with Mutual should still be considered legally binding.

“The licensing agreement is not voidable as a matter of law, since Mutual has been profiting from the contract and has been getting the benefit of its bargain for nearly 20 years,” Judge Anne Lazarus noted in the panel’s decision.

Mutual first filed suit six years ago, naming Hygrosol founders Sanford Bolton and Spiridon Spireas as defendants in the wake of both of them also being named as litigants in a suit filed by their former employer, St. John’s University, over legal rights to the liquisolid technology.

The technology was first developed roughly three decades ago, when Spireas was a professor at the Queens, New York, institution and Bolton was one of his doctoral students.

In its suit, St. John’s officials claimed that the patents in question belonged to the university based on agreements both men had agreed to. Ultimately, that part of the growing dispute was settled in 2015, with legal ownership to the liquisolid technology going to the university. 

Mutual’s suit soon followed, with company officials contending they had long been under the impression that Hygrosol was the sole owner of the technology, essentially resulting in the company paying “tens of millions” to a company that did not have legal ownership to a patent it was licensing.

A judge on the Philadelphia Court of Common Pleas granted summary judgment to Bolton's estate, Spireas and Hygrosol.

Munger Tolles & Olson LLP and Blank Rome LLP represented Mutual in the proceedings, while Hygrosol was represented by Elliott Greenleaf PC and Ballard Spahr LLP.

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Ballard Spahr, LLP Superior Court of Pennsylvania