A federal court judge has ruled that Cargill, Inc. failed to disclose material information to the U.S. Patent and Trademark Office while pursuing patents on healthy canola oils with increased stability.

In the lawsuit, filed in the United States District Court for the District of Oregon, Cargill originally alleged that Dow AgroSciences LLC, a wholly-owned subsidiary of The Dow Chemical Company, and its customer, Canbra Foods, Ltd., were infringing four Cargill patents on high stability canola oils by producing and selling Dow's Natreon canola oil. Prior to trial, the court ruled that two of those patents were invalid and dismissed them from the suit.

A two-week jury trial was held during June of 2005 in order to determine if the two remaining patents were valid. At the conclusion of that trial, the court asked the jury to render an advisory verdict on whether Cargill withheld material information from the patent office while pursuing its patents. The jury agreed with Dow and Canbra and advised the court that it believed that Cargill had concealed important testing data.

In its ruling yesterday, the court adopted the jury' s advisory verdict, and ruled that Dow and Canbra had proven that Cargill had committed "inequitable conduct" in the patent office, based on "clear evidence of an intent to conceal or deceive." As a result, the court ruled that Cargill' s patents are unenforceable.

The target of Cargill's lawsuit was Dow' s newly-developed Natreon canola oil, derived from Dow's proprietary Nexera canola seed. Natreon oil is naturally stable due to its "high oleic" and "low linolenic" fatty acid profile. Natreon contains no trans-fats and has superior cooking stability and shelf life.

"We are extremely pleased that the court has rejected Cargill' s efforts to block consumers' access to Natreon canola oil," > stated Pete Siggelko, vice president for Plant Genetics and Biotechnology at Dow AgroSciences. "Natreon offers a unique combination of traits. By replacing oils that have high levels of saturated fats and trans-fats, Natreon will have a very positive effect on consumers' health while delivering improved functionality."

"Importantly, Natreon provides superior performance and health attributes relative to the partially hydrogenated oils widely used by food companies and restaurants today," continued Siggelko. "In recent studies, Natreon outperformed partially-hydrogenated soybean oil in terms of stability and fry life, in addition to its very  significant health benefits."
 
Driven by the transition from partially hydrogenated oils, Natreon canola oil production is rapidly expanding to meet demand. Natreon oil is readily available now and Dow AgroSciences plans to have over 500 million pounds of Natreon available by the fall of 2006.

Tuesday's ruling was Dow's third significant victory over Cargill. In two earlier patent interference proceedings, the patent office determined that Dow was first to invent Natreon's uniquely healthy composition of fatty acids, rejecting similar claims by Cargill.

Dow AgroSciences LLC, based in Indianapolis, Indiana, USA, is a global leader in providing pest management and biotechnology products that improve the quality and quantity of the earth's food supply and contribute to the health and quality of life of the world's growing population. Dow AgroSciences has approximately 5500 people in over 50 countries dedicated to its business, and has worldwide sales of approximately US $3.4 billion. Dow AgroSciences is a wholly-owned subsidiary of The Dow Chemical Company.

Canbra Foods Ltd., a wholly-owned subsidiary of James Richardson International Limited, one of Canada's leading agri-business companies, is a progressive, integrated canola processing and packaging facility in Lethbridge, Alberta, Canada. Canbra is a supplier of Natreon oil to the food and food service industries.