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ABI, Roche Win $15.6M in Additional Patent Damages from MJ Research

Applied Biosystems celebrated a victory and suffered a defeat this week in its battle to uphold its intellectual property in the areas of PCR and real-time PCR.

On March 30, a US Court awarded ABI and Roche Molecular Systems $15.6 million in additional damages in the companies' PCR-related patent litigation against MJ Research and two of MJ's founders. The increased damages amount to $35.4 million plus attorneys' fees that MJ Research and the brothers who founded the company will be required to pay to ABI and Roche.

A year ago, a jury awarded the companies $19.8 million in damages when it found that MJ, now part of Bio-Rad Laboratories, had infringed several PCR patents held by ABI and Roche. At that time, the plaintiffs said they would seek to increase the damages because the jury found several infringements to be willful.

Bio-Rad is likely to have to pay the increased damages — plus legal fees — or at least part of them. In August, the company completed its acquisition of MJ Research for $32 million in cash "and the assumption of certain liabilities of those companies, including liabilities related to certain patent infringement litigation to which MJ Research is a party, plus a cash earn-out based on the outcome of such litigation," according to a company statement.

However, Ron Hutton, Bio-Rad's treasurer, told Biocommerce Week that the company plans to appeal the verdict but would not comment on when or how this would happen.

In addition, Bio-Rad continues to negotiate with ABI, he said. Last year, the company set aside $50 million in a contingency fund for the suit, according to Hutton.

Asked if Bio-Rad would be able to sell PCR instrumentation in the future once the litigation is over, he said "it certainly is our intention to be able to do so."

Applera, ABI's parent, and Roche originally filed the suit in 1998. MJ Research counterclaimed that ABI licensed and enforced its patents through anticompetitive conduct.

According to the written judgment, the court doubled the jury's award for infringing two sets of patents. Relating to PCR process patents, it doubled the award to $24.948 million against MJ and approximately $1.4 million each against Michael and John Finney, the company's founders. The court also doubled the damages relating to the '493 patent to $3.2 million against MJ and $178,200 against each of the Finneys. Combined with compensatory damages for infringement of the '675 and '610 patents, the total damage award now comes to $31.9 million against MJ, and around $1.8 million each against the Finney brothers.

According to ABI, the judge also dismissed all of MJ Research's antitrust counterclaims against ABI and Roche.

ABI said it has filed for an injunction against further infringement by MJ Research, which was acquired by Bio-Rad Laboratories last summer after MJ declared bankruptcy in March of 2004.

Several of Roche's PCR patents expired on March 28, including a number of PCR process patents. It was not clear how these expirations will affect Bio-Rad's negotiations with ABI. ABI did not return a phone call before deadline.

One Win, One Loss

ABI also said this week that the Japanese Patent Office has invalidated Applera's Japanese patent No. 3,136,129, which covers real-time PCR thermal cycler technology. ABI said it intends to appeal the decision.

The European Patent Office reached a similar verdict on Applera's equivalent patent in Europe in December, when it revoked the patent, EP0872562 entitled "Instrument for monitoring nucleic acid amplification reactions" (see BCW 12/16/2004).

Applera's US patent on real-time PCR thermal cycler technology, US Patent No. 6,814,934 entitled "Instrument for monitoring nucleic acid amplification," is still valid and is unlikely to be affected by the rulings in Europe and Japan. According to US law, it is the date of the invention, not the date of filing a patent application, that is relevant for patentability.

— JK

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