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Jury Finds Affymetrix Infringed on Oxford Gene s Patent

NEW YORK, Nov 10 – A jury delivered a mixed verdict in Oxford Gene Technology’s US patent infringement lawsuit against Affymetrix Friday, holding that Affymetrix did not willfully or literally infringe on OGT’s patents, but that it did infringe under a special rule called the " doctrine of equivalents,” Affymetrix reported.

The court also held that Affymetrix had a license to OGT’s technologies after June 1, 1999, agreeing with a UK appeal court ruling last week on the same issue.

In the lawsuit, which is being heard in the US District Court for the District of Delaware, OGT sought $120 million in damages against Affymetrix for willfully infringing on founder Ed Southern’s pioneering microarray patent.

This verdict substantially reduces the total damages that OGT can claim against Affymetrix: A finding of willful infringement would have allowed OGT to seek triple the amount of the damages it alleges it suffered, or up to $120 million. Now OGT can only claim up to $40 million in damages.

The trial will advance Monday to a second phase, in which the jury will consider Affymetrix’ claim that OGT’s patent is invalid and unenforceable. If the patent is held to be valid, a third phase of the trial will be held to determine damages.

“The most significant news today is the position taken by the court on the validity of our license,” Vern Norviel, Affymetrix’ senior vice president and general counsel, said in a statement. “We will now proceed to challenge the validity of the patent as well as other issues including patent misuse, fraud and anti-trust violations arising from OGT’s relationship with certain Affymetrix competitors."

Affymetrix alleged in pre-trial hearings that OGT was having its legal fees paid through a $15 million agreement with Agilent  entered into after OGT cancelled good faith patent licensing negotiations with Affymetrix.

Affymetrix also argued at trial that it did not infringe on OGT’s patents because it was holding these good faith negotiations with OGT, until OGT cancelled the negotiations because it was allegedly negotiating with manufacturing and marketing partners for its microarrays—specifically Agilent and Amersham Pharmacia Biotech.

But Agilent spokesman Doug Forsyth denied these allegations that Agilent was behind OGT’s lawsuit.

“The two cases brought by OGT against Affymetrix in the United Kingdom and the case brought against Affymetrix by OGT in Delaware were all brought long before OGT and Agilent initiated discussions leading to our agreement on terms for Agilent's patent license,” Forsyth said Thursday. ”Consequently, no action by Agilent prompted OGT's suits against Affymetrix.”

However, Forsyth said, Agilent’s agreement with OGT did provide that OGT could use the $15 million for “a variety of purposes, including funding its litigation efforts.”

Affymetrix has put aside 10 percent of sales revenues for any possible royalty payments, according to a report by Robertson Stephens analyst Mike King.

OGT lawyers were unavailable for comment on the ruling.
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