Genentech withheld royalties from hospital, jury finds.(Brief Article)

2002 JUL 10 - (NewsRx.com & NewsRx.net) -- A jury awarded City of Hope National Medical Center $300.1 million in compensatory damages in June 2002, after finding that Genentech, Inc. failed to pay royalties on the sale of some drugs developed from City of Hope research.

By a vote of 9-3, the Superior Court jury agreed with City of Hope's claim that Genentech willfully withheld the royalties on several drugs manufactured under the terms of a 1976 licensing agreement.

The jury also found on a 10-2 vote that Genentech, a biotechnology giant based in South San Francisco, acted with malice or fraud, a finding that triggers a second phase of the trial to determine punitive damages.

The jury reached its verdict after 16 full days of deliberation and 25 days of testimony.

"We're going to ask for substantial punitive damages," said Glenn Krinsky, in-house counsel for City of Hope.

The jury apparently accepted a Genentech argument limiting City of Hope's damages based on a statute of limitations. Krinsky said the amount awarded by the jury was exactly what the hospital said it was owed from 1994 though the present, including 7% simple interest.

It was the second trial of the case. The first ended in a mistrial last October when the jury failed to reach a verdict after eight days of deliberation.