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ABI Settles Second Case with Promega in a Year; Forensic ID, Paternity Tests Subject of Latest Deal

Applied Biosystems said this week that it has settled outstanding legal disputes with Promega regarding the sale of forensic identification and paternity testing kits.
Terms of the settlement were not disclosed, but an ABI spokesperson confirmed this week that the settlement was related to a suit filed by Promega and a countersuit filed by ABI regarding forensic ID and paternity test kits. The settlement is the latest in a series for ABI over the past year — including a previous settlement a year ago with Promega related to PCR technology — as the firm has sought to clear up several lingering legal disputes and lower its litigation costs.
In 2001, Promega filed a lawsuit against ABI and several other defendants, including Lifecodes, Cellmark Diagnostics, and Genomics International, alleging that these defendents infringed US Patent Nos. 6,221,598 and 5,843,660 by selling forensic identification and paternity testing kits. ABI responded with a countersuit that alleged patent infringement by Promega. The case was dismissed in October 2002 amidst settlement negotiations, but because it had been dismissed without prejudice, Promega had the option to refile its claim against the defendants.
A Promega spokesperson declined to comment on the settlement.
The Other Promega Case
This most recent settlement followed one reached a year ago between ABI and Promega. In that case, Promega had filed a complaint in 2003 against Hoffman-La Roche under the False Claims Act for overcharging the US government for thermal cyclers and PCR reagents. In the complaint, Promega named ABI as one of Roche’s “co-conspirators.”
According to the filing, Roche "and its co-conspirators" engaged in "an overcharging scheme, which diverted millions in US tax dollars that could otherwise have been used for research programs."
Promega said this scheme had several prongs: payment of royalties for use of Taq polymerase "based upon a patent obtained by inequitable conduct," as well as "anticompetitive tying of sales of Taq to other products; deceptive licensing practices; and predatory threats of litigation." Promega and its co-plaintiffs had sued for triple damages under the act, as well as a civil penalty of $10,000 for each claim.
The US District Court for the Eastern District of Virginia dismissed the case in June 2004, and Promega and Applera both filed appeals, which were settled between the companies in the fall of 2005. Promega settled with Roche separately around the same time. The settlements opened the door for Promega to negotiate a license to Roche’s PCR patents with ABI.
Latest of Several Settlements
The settlement announced this week is the latest in a string of settlements that ABI has reached in the past year.
In early July, Applera and Beckman said that they had resolved all outstanding legal issues regarding Beckman Coulter's capillary electrophoresis technology and Applera's allegations of breach of contract. The companies said that the terms of the agreement are "consistent" with those of a preliminary agreement that they disclosed in April (see BioCommerce Week 5/3/2006).).
At the time, the companies said that Beckman would grant Applera licenses to its patents for replaceable gels for capillary electrophoresis instruments and DNA sequencers, and to its patent for a heated lid for thermal cyclers. Applera would subsequently pay Beckman $35 million to "release ... any and all claims of infringement relating to DNA sequencer and thermal cycler products."
Under the preliminary terms, Applera also agreed to grant Beckman licenses to its patents for nucleic acid sequencing and real time PCR thermal cycling for use in the diagnostics market. Consequently, Beckman would pay Applera's Celera Genomic segment $20 million over 30 months for rights to use the technology in that market.
In February, Applera and Roche settled a long-standing patent infringement suit against Bio-Rad Laboratories and its MJ Research unit, enabling MJ to resume selling its thermal cycler products in the US (see BioCommerce Week 2/15/2006). The settlement came after the court had already awarded Applera and Roche over $35 million in damages in the case.

An ABI spokesperson confirmed this week that the settlement was related to a suit filed by Promega and a countersuit filed by ABI regarding forensic ID and paternity test kits.

In December 2005, following three years of litigation, Applera settled a patent dispute with Australian firm Genetic Technologies, allowing ABI to continue selling certain products containing non-coding DNA technology that is covered by Genetic Technologies' patents (see BioCommerce Week 12/15/2005).
Neither company would disclose the financial terms of that settlement, which ended a dispute dating back to March 2003, but Genetic Technologies said that as part of the agreement Applera had licensed its patents. The settlement also allowed ABI and sister company Celera to continue selling a variety of products incorporating non-coding DNA.
Despite the numerous settlements, ABI is still engaged in several legal disputes. According to a filing with a US District Court in Connecticut dated June 30, the firm is currently involved in settlement talks with Stratagene regarding a suit claiming that certain Stratagene instruments infringe ABI’s real-time PCR patents (see BioCommerce Week 7/12/2006).
ABI also is embroiled in a patent infringement suit filed by Thermo Electron unit Thermo Finnigan, a patent infringement suit related to labeled and modified nucleotides filed by Enzo Biochem and Yale University, and a class action suit filed by Molecular Diagnostics Laboratories for alleged anticompetitive practices in selling Taq polymerase.

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