On July 9, 2009, ALJ Robert K. Rogers, Jr. issued the public version of Order No. 23 (dated June 29, 2009) in Certain Non-Shellfish Derived Glucosamine and Products Containing Same (337-TA-668).  In the Order, ALJ Rogers (i) denied a joint motion filed by complainant Cargill, Inc. (“Cargill”) and respondent Ethical Naturals, Inc. (“ENI”) to terminate the investigation as to respondent ENI, and (ii) granted a joint motion for leave filed by Cargill and ENI to not serve the remaining respondents with certain portions of the settlement agreement between Cargill and ENI (the “Settlement Agreement”).

According to the Order, the ITC’s rules provide that “in the case of a proposed termination by settlement agreement, the parties may file statements regarding the impact of the proposed termination on the public interest, and the [ALJ] may hear argument, although no discovery may be compelled, with respect to issues relating solely to the public interest.”  In connection with their joint motion to terminate, Cargill and ENI asserted that the Settlement Agreement is consistent with the public interest.  The Commission Investigative Staff opposed the motion to terminate, arguing that the Settlement Agreement did not promote the public interest.

In the Order, ALJ Rogers determined that “[w]hile this investigation only concerns the [asserted] patent, the settlement agreement is broader.”  Specifically, according to the Order, the “agreement states that ENI will not ‘assist any Third Party to make, have made, use, import, offer to sell, or sell Non-Shellfish Glucosamine in the United States, the European Union, Canada, or Brazil.’”  Also, when “defining ‘Non-Shellfish Glucosamine,’ the licensing agreement states that the definition shall include products containing non-shellfish glucosamine, and shall mean glucosamine derived from fungal or microbial biomass or other vegetarian sources.”  Thus, because the asserted patent claims are method claims directed to a method for obtaining glucosamine from a fungal biomass, ALJ Rogers determined that the “concern arises that the foregoing provision can be construed as an attempt by Cargill to expand its monopoly to cover an unpatented product manufactured by a process other than that covered by the [asserted patent]” and that “[s]uch a result could arguably be construed as patent misuse.”  Accordingly, although ALJ Rogers determined that there is no evidence that the Settlement Agreement violates the antitrust laws, he denied Cargill and ENI’s joint motion to terminate the investigation as to ENI because he could not “find that the settlement agreement will have no harmful effect on the public health and welfare, competitive conditions in the U.S. economy, the production of like or directly competitive articles in the United States, or U.S. consumers.”

Regarding Cargill/ENI’s joint motion for leave to not serve the remaining respondents with certain portions of the Settlement Agreement, both the Commission Investigative Staff and respondent Nantong Foreign Trade Medicines & Health Products Co., Ltd. (“NFT”) filed responses in opposition.  In granting the joint motion, ALJ Rogers noted that Cargill recently filed a motion to terminate the investigation as to NFT based on Cargill’s withdrawal of the complaint.  In light of NFT’s response stating that it did not oppose the withdrawal of the complaint and termination of the investigation, ALJ Rogers determined that “there is no legitimate need for NFT’s counsel to have access to the confidential settlement agreement.”