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Monday, 5 November 2007

No striking out, but net gain for Bestnet?

Subscription-only service Lawtel has produced this today: it's Vestergaard Frandsen A/S, Vestergaard Frandsen SA and Disease Control Textiles SA v Bestnet Europe Ltd and others [2007] EWHC 2455 (Ch), a 25 October 2007 decision of Roger Wyand QC, sitting as a Deputy Judge of the High Court, England and Wales, concerning an application to strike out an action for breach of confidence. This case is not available on BAILII.

Vestergaard developed a polyethylene mosquito net with an insecticide incorporated into the plastic matrix. Bestnet and the other defendants (two ex-employees of Vestergaard as well as four companies owned and controlled by them) later developed its own product, using polyethylene and an insecticide. According to Vestergaard, Bestnet had developed their product using confidential information relating to Vestergaard's own product. Bestnet in turn submitted an expert report that suggested that the information they used to achieve their product could all have been obtained in the public domain and from industrial information sources that were not secret, such as from polymer and additives manufacturers. The report also concluded that Bestnet's product was significantly different from Vestergaard's, being an original and independent development. Accordingly, said Bestnet, Vestergaard had no case since it hadn't shown it had any information that had the necessary quality of confidence; nor had it identified precisely what information Bestnet was supposed to have used or the evidence to support its allegation.

Roger Wyand QC refused the application to strike out Vestergaard's claim. In his view

* it was unclear how Bestnet's expert sought to separate (i) knowledge gained from the database pleaded by Vestergaard as being confidential if Bestnet had consulted it during the development of their product from (ii) knowledge that Bestnet would have been expected to take away in their heads from their employment with Vestergaard.

* nor was there any evidence to show that Bestnet had taken their information from a manufacturer's data sheet as opposed to Vestergaard's database, as Bestnet had suggested.

* Bestnet sought to rely on the patent for which Vestergaard had applied in order to establish that their information was not confidential, but the information contained in it did not appear to be the same as in the pleaded confidential information.

* Bestnet's expert report regarding the difference between its own final product and the formulation contained in Vestergaard's purported confidential information was clear. If that had been the sole issue the court may well have found that Vestergaard's case had no merits. However, the report did not adequately address the important question of whether Bestnet had gained an advantage through having and using Vestergaard's confidential information.

* although Bestnet's expert report may well prove to be held decisive at trial, in the circumstances it was not possible to rule at this early stage of proceedings, and without a proper examination of the facts, that Vestergaard's case was without merits. Nor was it possible to decide that Vestergaard had not made out a case that Bestnet had used its confidential information.
Says the IPKat, this is interesting: the fact that Bestnet didn't get Vestergaard's action struck out must have disappointed them, but the outcome is that Vestergaard now has a much clearer idea of the substantial obstacles it faces if it wants to press on in the light of Bestnet's report -- which may precipitate a negotiated settlement. Merpel says, mosquitos are one thing, but what about better protection against cat fleas?

Vestergaard-Frandsen disease-control textiles here
Bestnet mosquito game here (scroll down to Mosquito)
Insct-repellent socks here

5 comments:

Anonymous said...

Interesting... that Vestergaard Frandsen is on that side of the table in this case. In India they are involved in a corruption case according to an Indian News company - NE TV

Anonymous said...

It s also interesting to note that both Bestnet and Vestergaard do not and never did possess the competences necessary to develop the mosquito nets - nor do they claim they did. Let alone that the product of a) is made from a different material than that of b) and that the method of combining polymer and insecticide in the two products is also completely unrelated.
This write up is lacking quite a bit of information to make any sense.

Anonymous said...

your link to Bestnet does not work, try www.Intection.com.

The Indian case is interesting, this is the story found on the net:

Rs 10 cr mosquito net scam bites Assam health dept; Free distribution from UNICEF called off, syndicate floats own tender
NE TV Correspondent
Guwahati, Dec 20
The scandal-hit Assam health and family welfare department is rocked by yet another scam worth Rs 10 crore. The scam took place while the
department was receiving mosquito nets meant for the flood victims from the UNICEF. That too free of cost. But Rs 10 crore deal came up to hit the
department as soon as the big heads invited tender for supply of nets after stopping the free distribution later. The NETV has in its possession, some
documental proof to disclose how the astronomical amount of fund has been pocketed by a section of corrupt officials.
Scam and the Health Department, Govt. of Assam seems to be synonymous to each other. We may recall that 6 years ago, Govt spend a huge amount
for free distribution of mosquito net amongst the villagers. Surprisingly, Govt procured items were defected and the villagers protested vociferously.
As a result, Govt. recalled all the mosquito nets and ordered an Investigation. The nets are still lying at the department's storage at Amingaon and
cannot be used anymore. During the last five years, the govt. has spent over Rs. 50 lakh alone on rent for storing the materials at the Amingaon based
storage, which falls under the Assam Warehouse Corporation with its office at Christian Basti. NETV team also tried to contact the manager of the
Assam Warehouse Corporation, one Thakuria, but he has evaded all attempts of contact. This time again another multi-crore scam has come to the fore
in the Assam Health Department. NETV has in its possession documental proof of how Rs. 10 crore scam is in the making, involving top officials of
the health department. Startling facts came to light when NETV, began investigation into the multi-crore scam and contacted the UNICEF head office
at Lodhi road in New Delhi. It must be mentioned here that the Health Department had distributed long lasting insecticidal mosquito nets in 6 floodravaged
districts of Assam including Lakhimpur, Dhemaji, Karbi Anglong and Dhubri. The high quality imported materials were provided by the
UNICEF at free of cost. Vide letter number AFO/2007/HLT/563, the UNICEF had instructed the Assam government to distribute 50, 000 mosquito
nets in the 6 affected districts. From UNICEF sources based in Guwahati's GS Road NETV found out that the long lasting insecticidal mosquito nets
branded as PERMANET were imported from Denmark based company called Vestergaard-Frandsen, with its India Office at Saket, New Delhi. The
Denmark based company is among the only 7 manufactures of the world, producing this long lasting insecticidal mosquito net. It has also come to light
that the Mosquito net distribution syndicate took the Assam Health Minister, Dr. Himanta Biswa Sarma into confidence and gave shape to their plans.
As a first step of their game plan they diplomatically suspended the free distribution of the nets. Next, they got the Regional Manager of Vestergaard-
Frandsen Company, Mr. Manish Sharma to Assam and a secret meeting was held, where the entire game plan was hatched. Two top officials of the
Health Department were also present in the meeting. After suspending the free distribution of the high quality nets, the Director of Health Services,
Assam called for a tender, published in the leading newspapers of Assam, on 19 th of November, this year, flouting all the norms. The tender notice
calling itself raised eye brows of suspicion as it did not mention the actual cost of the mosquito net or the required 2 % earnest money of the contract.
On the contrary, health department asked for Rs.1lakh from the bidding contractors. It is learnt that this syndicate submitted 3-4 tenders. The
syndicate's game was well planned. It went ahead to procure the nets from Vestergaard-Frandsen, which became clear from the fact that the
specifications laid down for the manufacturer of the nets, could only be fulfilled by the Denmark Company But how safe these mosquito nets are, has
been questioned. In a startling investigation, an international Journal, named 'Africa Fight For Malaria' on page 5, mentions that the so called long
lasting insecticidal mosquito nets of the Denmark Company contains, deltamathrin, a chemical which could be very harmful to a newborn baby
sucking on the net at night. This fact also finds mention in the Generic Risk Assessment Report of the World Health Organisation Pesticide Evolution
Scheme. It may also be mentioned that Permanet 1.0, one to the two brands of Vestergaard manufactured nets, was banned by the World Health
Organisation. When asked to the deputy director of Institute of malaria research centre at sonapur , Dr Vas deb have this to say regarding the
Vestergaard company. -At the instructions of the health minister Himanta Biswa sharma ,a technical committee has been headed by Dhrubjyoti Hojai
with members Dr J.C Doley who is a joint director of malaria ,Partha gogoi,Dr Vas Deb who is a deputy director of Institute of malaria research centre
at sonapur , Mr.Choudhry of textile department to evaluate the tender proposal.Later it will go to purchase board and Rs. 10 crore will come from 12th
finance commission. When contacted with Director of Health services,Dr. Dhrubjyoti Hojai he refused to say anything on NETV camera but tactfully
NETV team have captured his audio visuals this way. At a time when we are yet to find out the cause of the recall of the last ordered Net's, Assam
government is again planning to squander people's money to procure the nets by canceling UNICEF's free distribution scheme of the same nets. By
doing this the Assam government is encouraging the syndicate to indulge in rampant corruption.
..::: Satellite Channel Of Northeast :::.. Page 1 of 2
http://www.netvindia.com/news.html 21.12.2007
..::: Satellite Channel Of Northeast :::.. Page 2 of 2
http://www.netvindia.com/news.html 21.12.2007

Anonymous said...

The mosquito net sold by Vestergaard was a polyester net while the Bestnet mosquito net is a polyethylene net. The first is coated the latter is incorporated.

Anonymous said...

After Uttar Pradesh, it is the turn of Assam where massive irregularities — running into several crores of rupees — in purchasing Long Lasting Insecticide Treated Bed Net (LLIN) under National Rural Health Mission of Assam health department.
The NGO, National RTI Forum, a Lucknow-based civil society working in the field of transparency in governance, has presented documentary evidence to the CVC pointing that Assam paid `400 for each net, while Orissa bought the nets the same month in 2009 as the Assam government at `279 each from the Indian subsidiary of the MNC.
The NGO has pleaded for a thorough investigation under the supervision of the CVC, while suspecting a massive scam in purchase of medicated mosquito nets spread over several states, including Assam, Andhra Pradesh, West Bengal, Orissa, Goa among others.
Assam, however, tops the list in volume of the alleged scam as it has purchased the highest number of LLINs (21 lakh) paying `400 per net, around `84.48 crores in total. In contrast, these LLINs were sold to Goa at `199 a piece.
It is significant that these LLINs were also in the thick of controversy in Assam because it was distributed to the beneficiaries just before the polls in 2010.
The Assam health department made two purchases in September and December 2010 from an intermediary Global Business Services. However, other states purchased the LLIN directly through the Indian subsidiary of the Switzerland-based manufacturers.
The state health department placed its first order (letter no. 69/2008/PT/78) dated August 27, 2010. The letter mentioned that 16.75 lakh units were to be supplied for `67 crores under the CM’s special scheme 2010-2011.
The documents provided by the NGO to this newspaper and also submitted to the CVC show that the Global Business Services entered into an agreement with Vestergaard Frandsen India Private limited to buy the LLINs at the rate of `295 per unit.
The purchase order was issued on August 30, 2010.
The second order was placed on December 18, 2010 (letter no. HSG/Mosquito/69/2010 (1500) for supply of 4,75,500 units at the same rate under the NRHM. Global Business Services bought the mosquito nets from Vestergaard Frandsen India Private Limited, this time at the rate of `285 per unit.

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