Anyone questioning the value of metallocene technology can find a partial answer in Houston, where Mobil Corp. is appealing a court order to pay $171 million to Exxon Chemical Co. for violating a metallocene catalyst patent.
Industry experts said the fine, set by a U.S. District Court jury in Houston, is the largest publicly acknowledged penalty to date in a string of lawsuits based on metallocene technology.
Mobil Chemical Co. President Raymond McGowan said in a news release he is concerned about the implications of the decision.
``If Exxon prevails in receiving damages based on the potential future value of technology, this case could undermine legitimate research throughout the petrochemicals industry,'' McGowan said.
He added that Exxon admitted it did not lose any profit or sales as a result of Mobil's research activities, and the jury ruled that Mobil had not willfully infringed on the patent.
Mobil Chemical is a unit of Mobil Corp.; both are based in Fairfax, Va.
In spite of the praise heaped on metallocenes, their commercialization has been hampered by processing difficulties, price and legal battles.
The patent in question — U.S. Patent 5,324,800 — has been ``consistently recognized ... as one of the major developments in the commercialization of metallocene resins,'' according to Greg McPike, chief executive officer and president of Univation Technologies LLC of Houston.
Univation is a joint venture between Houston-based Exxon and Union Carbide Corp. designed to license the firms' combined metallocene technologies.
``With metallocene catalysts revolutionizing the plastics industry, the value of this technology to the polyolefins marketplace is enormous,'' Exxon Chemical President Ray Nesbitt said in a news release.
The lawsuit was filed in November 1996, more than three years after Mobil announced it had the ability to produce metallocene-based polyethylene.
Exxon learned of the potential infringement from presentations Mobil made at trade shows and conferences and from information from resin customers who were sampling Mobil's metallocene-based products.
In an Aug. 12 telephone interview, McPike said the settlement was ``a good example of the risks involved'' in the metallocene field.
``I think [the settlement] will cause people who are developing metallocene technology to pause and take a look and decide if they have freedom to operate,'' he said. ``The financial risk is quite high.''
The lawsuit was intended as a statement by Exxon and Univation that they were going to pursue anyone not interested in licensing their technology, according to John Murphy, a consultant with Catalyst Group in Spring House, Pa.
``Even if the penalty had been a dollar, [Univation] would be running around and talking to everybody else about it,'' Murphy said.
Exxon and Dow Chemical Co. of Midland, Mich., are the leaders in the field, each holding several key patents. Each company produced 100 million to 150 million pounds of metallocene-based resin last year.
Exxon and Dow are embroiled in a separate lawsuit filed by Dow last month, in which it claims Exxon has violated one of its primary metallocene patents. The Exxon catalyst named in the Dow lawsuit is not the same one named in the Mobil lawsuit.