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Illumina Guilty of Infringing Five Affy Patents, Ordered to Pay $16.7M, Says it Will Appeal

This article has been updated from a previous version to include comments from Illumina.

NEW YORK (GenomeWeb News) – A jury has found Illumina guilty of infringing five Affymetrix patents and has required it to pay Affy $16.7 million in royalties, according to a verdict filed today in a US District Court in Delaware.

Illumina plans to appeal. In a statement issued today, Illumina CEO Jay Flatley said that the verdict was made "without consideration of the validity and enforceability of any of the patents asserted by Affymetrix" and is therefore "preliminary."

Flatley added that the case will now proceed to another phase, during which Illumina intends to prove that Affy's claims are "invalid and unenforceable." In the meantime, he said, "we will continue to sell the products that are the subject of this suit and no damages will be payable to Affymetrix until all appropriate appeals have been taken."

Affymetrix sued Illumina in July 2004 for allegedly infringing six patents, but the company later dropped one from the case. Affy sought lost profits, royalties, damages for willfulness, and a permanent injunction that would prohibit Illumina from using the patented technology.
A Markman hearing later established 12 claims in the five patents where Illumina allegedly infringed on Affy’s IP.
The jury on March 12 found Illumina guilty of infringing 11 of the 12 claims but did not find that Affymetrix was entitled to the damages it sought. Instead it decided that Illumina must pay Affy a 15-percent royalty rate, which amounted to $16.7 million for sales through the end of 2005.
Flatley said that this amount is "less than half" the total amount of damages that Affy sought in the trial 
Affymetrix and Illumina have not returned calls for further comment.
Shares in Affy were up 5 percent at $26.90 and Illumina’s stock was down 6.8 percent at $29.16 in mid-afternoon trading today.



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