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Saudi Basic Industries Corp. v. Mobil Yanbu Petrochemical Co.1/14/2005
ylene technology. Article 6.1, SABIC asserts, "plainly reflects the parties' intent that separate, later-executed technology icenses, not the [joint venture] agreements, would exclusively govern the provision by a partner of the technology 'required' to 'manufacture' polyethylene." Because SABIC owned the Unipol(r) PE technology, Article 6.3 does not apply and therefore (SABIC concludes), no breach of Article 6.3 could legally have occurred.
The Superior Court rejected this argument on the ground that it ignores the plain language of Articles 6.3 and 6.1, as well as the substantial persuasive evidence that undermines SABIC's position. We conclude that the trial court ruled correctly. SABIC's entire position rests upon a distinction between partner-licensed and partner-owned polyethylene technology. Article 6.3, however, makes no such distinction. Article 6.3 does not exclude partner-owned polyethylene technology from its coverage. Indeed, that provision covers technology that a partner "procures," and as the trial judge held, " reasonable jury could conclude that 'procures' includes a 'purchase.' In fact.a number of witnesses at trial.testified that 'procures, as it appears in Articles 6.3, would include a purchase of technology.'"
SABIC's distinction does not aid its position for a second reason: a reasonable jury could have found that SABIC was a licensee, not the owner, of the Unipol(r) PE polyethylene technology. That technology SABIC then sublicensed to the partnerships-the very scenario that is contemplated and covered by Article 6.3. The trial court so held:
SABIC's argument that it purchased the Unipol(r) PE technology and then licensed it to the Joint Ventures rings hollow in light of the great weight of evidence in the form of documents that refer to sub licenses.. The record is replete with documents referencing the UCC-SABIC transaction as a license and the SABIC Joint Venture transactions as sublicenses. SABIC's witnesses attempted to explain to the jury that while the term "sublicense" may have been used, SABIC "attached no legal meaning" to that term. The overwhelming documentary evidence supports the jury's finding that the true character of the UCC-SABIC agreement was a license, that the agreements with KEMYA and YANPET were sublicenses, and that Articles 6.3 applied.
SABIC next argues that the evidence conclusively establishes that the parties intended for Article 6.1 of the joint venture agreements (which contains no pass-through requirement)-not Article 6.3 (which does)-to govern the terms under which SABIC could sublicense the Unipol(r) PE technology to the joint venture partnerships. Only if the plain language of Article 6.1 is ignored can this argument attain plausibility, because in fact Article 6.1 fatally undercuts SABIC's claim.
Article 6.1(a) of the Kemya joint venture agreement provides that: To the extent patents and licensing rights and related technical proprietary information are in the opinion of the Partners required to design and construct the Petrochemical Plant and produce Manufactured Products, ECAI [Exxon Chemical Arabia Inc.] and its affiliates to the extent they are permitted (without having to account to a third party) shall offer to provide to the Partnership, all such patents, licensing rights, technical and proprietary information necessary to perform its obligations hereunder consistent with Annex XI hereto.
Article 6.1 explicitly and specifically refers to Exxon and Mobil, but that provision does not in any way mention, refer or even allude to SABIC. For that reason alone the jury had a reasonable basis to find that Article 6.1 does not apply to SABIC and, therefore, confers no rights upon SAB
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