MSM Investments Company, LLC Announces $1.2 Million in Damages Awarded Against Carolwood Corporation by Federal Court

PORTLAND, Ore.--(BUSINESS WIRE)--April 4, 2003--MSM Investments Company, LLC, today announced a Federal Court judgment against Carolwood Corporation for damages of $1,168,775, plus accruing interest.

The United States District Court for the District of Oregon entered its judgment in favor of MSM Investments Company, LLC, last October. The federal court also declared that the Carolwood settlement agreement and patent license was terminated effective May 22, 2002.

The case arose out of Carolwood's failure to pay royalties under a patent license contained in a contract settling an earlier patent infringement suit brought by MSM Investments against Carolwood.

"I am delighted that justice has been served," said Robert J. Herschler, founder of MSM Investments Company and the biochemist who invented and patented numerous health applications for methylsulfonylmethane. "Income from this long awaited award will fund increased enforcement efforts to protect the interests of our licensees and their loyal customers worldwide."

As a result of the court ruling, the only companies which are now licensed under the Herschler MSM patents are Cardinal Nutrition of Vancouver, Wash., and Chemiplus, located in Japan. Only Cardinal Nutrition, Chemiplus, and their customers are authorized to use MSM, or to make, use, sell or distribute MSM compositions in accordance with Herschler's United States or foreign patents for human and animal use.

Carolwood Corporation has filed an appeal to the Ninth Circuit of the District Court's decision. MSM Investments has also appealed whether G. Rex Bailey, president of Carolwood, is personally liable for MSM Investment's damages.

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