The buck stops here for Dr Gray

The saga between the University of Western Australia, Sirtex Medical Ltd and Dr Bruce Gray appears to be drawing to a close.  The Federal Court has now determined that Sirtex is entitled to recover just under $3 million in damages from its former director and shareholder, Dr Gray.  Click here to access the decision.

The decision follows a finding by Justice French in 2008 that Sirtex was entitled to recover damages for the lost opportunity to negotiate a settlement of the proceedings with the University, which resulted from Dr Gray’s misleading and deceptive conduct and failure to comply with his duties as a director of Sirtex by not notifying the company of a potential claim by the University to IP created by Dr Gray.  Sirtex, which was spun off from the University to commercialise Dr Gray’s IP, argued that had Dr Gray notified it of the University’s potential claim, it would have entered into negotiations to settle a potential claim through a share issue to the University in return for a release from any future claims.

This aspect of the first instance decision was not appealed to the Full Federal Court and, following the University’s unsuccessful application for special leave to appeal to the High Court, Justice Barker was left to determine the issue of damages between Sirtex and Dr Gray.  Mallesons has previously blogged on the appeal to the Full Federal Court and the special leave application.

The damages sought by Sirtex initially totalled $2,298,180.01, plus interest, and were assessed by reference to the legal costs the company had expended defending the University’s claims.  Justice Barker found that the legal costs incurred by Sirtex in relation to the original proceedings before Justice French are recoverable as damages but should be reduced by 14% as there was an 86% probability of Sirtex settling the proceedings with the University.

About the Author

James Ellsmore
James is a senior associate with King & Wood Mallesons' Intellectual Property team in Sydney. James assists clients to resolve intellectual property disputes, with a particular focus on patents, pharmaceuticals and the life sciences. He has acted for a variety of clients in matters concerning patent infringement and revocation proceedings in the Federal Court of Australia, patent opposition proceedings before the Commissioner of Patents, and matters arising from patent licence and technology agreements. James also has experience in the preparation of commercial, R&D and IP agreements for leading universities, research organisations and pharmaceutical companies. He also advises clients on regulatory issues affecting clients in the industrials, consumer and health sectors.
View all posts by James Ellsmore

Leave a Reply

Your email address will not be published. Required fields are marked *

fifteen − 5 =