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Roche Issues Response to Promega Lawsuit Announcement

NEW YORK, Nov. 14 (GenomeWeb News) - In a formal response to Promega's announcement of a lawsuit against Hoffman La Roche for an "overcharging scheme," Roche said today that Promega's claims lack merit and that Promega's decision to announce the suit "is simply a litigation tactic."


Heino Von Prondzynski, head of Roche Diagnostics, stated, "We reject all claims brought by Promega. Promega obviously tries to shift the focus away from their own unlawful behavior of selling unlicensed PCR products by trying to damage our reputation. We consider taking all steps available against this material reputation damage."


Furthermore, Prondzynski said that Promega had recently tried to settle the suit. "If they believe they have such a strong case, it is more than difficult to understand why Promega called us two weeks ago to put this case on hold and to settle it outside of court," he said.


Promega said in  yesterday's press release that it filed suit against Roche and "co-conspirators," under the US False Claims Act, alleging that Roche engaged in schemes involving paymentof royalties for use of Taq "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 said it is suing for treble (triple) damages on behalf of US government researchers.


But Roche's statement today said that the lawsuit just "recycles allegations that have been litigated in a decade-long lawsuit between the two companies," and that Promega's characterization in its press release of a recent ruling in this underlying lawsuit was "misleading."


Eleven Years in Litigation


This is the latest round of salvos in litigation between the two companies that stretches back to 1992, when Roche sued Promega in the US District Court for the Northern District of California, for violating a license agreement and contributing to infringement of Roche's patents for PCR and Taq enzymes.


According to the court documents, Promega had a license to one patent for the Taq enzyme, to sell Taq reagents for other than PCR applications.  Promega had obtained the license to this patent, No. 4,889,818, from Cetus, the original holder of the patents to the Taq enzyme and PCR. In December 1991, Roche aquired all of Cetus' Taq patents. Roche brought suit against Promega the next year, alleging that Promega's sale of "PCR optimized kits" to researchers violated the license agreement to the '818 patent and contributed to infringement on Roche's patents. 


In defending against this claim, Promega counter-argued that the '818 patent was obtained through "inequitable conduct," and was therefore unenforceable, the court documents show. In December 1999, the California US District Court ruled that the patent was unenforceable, holding that the applicants to the '818 patent did commit inequitable conduct based on eight misrepresentations and omissions of information about Taq. (This ruling rendered Roche's claims for infringement or breach of the licensing agreement to the patent moot.) Roche then appealed the District Court's decision on the unenforceability of this patent to the US Court of Appeals for the Federal Circuit.


This March, the Appeals Court issued a ruling that ensured the litigation would continue: While it found the applicants to the '818 patent had committed some of the inequitable conduct, it overturned the lower court's finding as to some of the other inequitable conduct, and returned the case to the California District court for a further determination as to whether the patent is unenforceable based on these findings.


In July, Roche was denied a rehearing by a full panel of the appeal's court's judges, so the case returns to the lower court, and issue about the enforceability of the '818 patent-as well as Roche's underlying claim against Promega- remains in legal limbo.


The allegations in this latest suit appear to rest on some finding of "inequitable conduct" - which is firmly established by the Appeals Court-and not the enforceability of the underlying patent, it appears that the suit will not have to wait for the California District court to rule, once and for all, as to the enforceability of the '818 patent.


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