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Court Grants Illumina Permanent Injunction Against BGI, Blocking Sale of Products in US

NEW YORK – A federal judge has granted Illumina a permanent injunction in the aftermath of a patent infringement lawsuit against BGI, which will delay the sale of BGI's sequencers and reagents in the US.

In an order addressing multiple post-trial motions signed Sunday, Judge William Orrick of the US District Court for the Northern District of California also upheld a jury verdict awarding Illumina $8 million in damages for patent infringement and overturned the jury's decision to invalidate Illumina's US Patent No. 10,480,025, "Labeled nucleotides." Furthermore, he denied BGI's motions for a new trial and a bid to invalidate several other Illumina patents.

The injunction cements a preliminary injunction issued in this case in June 2020, which prevented BGI and its subsidiaries, including MGI Tech, from distributing and promoting their sequencing platforms in the US. The order also enjoins BGI and its affiliates from conducting infringing R&D activities in the US. However, against Illumina's wishes, the injunction permits BGI to offer products for sale, so long as the actual sales are made after the patent expires.

Illumina declined to comment on the orders.

"MGI is pleased that the Court ... denied Illumina's request to overturn the jury's decision invalidating [US Patent No. 7,541,444]," MGI said in a statement. "The '444 patent was not set to expire until June 2023. Because the other patents Illumina asserted against MGI's CoolMPS technology expire in August 2022, MGI now has the ability to commercialize the CoolMPS technology-based products in the US ten months earlier, by August 2022."

"We are also pleased that the court's ruling allows MGI to market all products related to the lawsuit immediately, as long as sales do not occur until after the patents asserted against those products expire. With this in mind, we will announce our product launch decisions in the US in the near future," MGI said.

Orrick noted that "If defendants make offers to sell accused products in the US before the expiration of the patents-in-suit — as they are permitted — they must include the following conspicuous written disclaimer: 'No sales will occur, and no purchase orders will be accepted, until after Aug. 23, 2022.' Such a disclaimer is not necessary for any promotion, advertising, and marketing of the accused products for sale after the patents expire."

The patent that BGI's CoolMPS chemistry was found to infringe expires in August, Orrick noted. Several of the other patents in the suit are set to expire in the next few years. When BGI might be able to finalize the sale of sequencing instruments in the US isn't clear.

Previously, Illumina said that US Patent No. 7,771,973, titled "modified nucleotides" will expire in August 2022.

Orrick denied Illumina's motions for attorneys' fees and enhanced damages but upheld a finding of willful infringement and awarded Illumina prejudgment interest at the prime lending rate, compounded quarterly.

The legal battle between the sequencing firms is far from over, though. MGI has sued Illumina in several recent instances, alleging infringement of two patents owned by Complete Genomics, a US affiliate of MGI, set to go to trial next month, as well as alleging antitrust violations.

And, according to the court, "both parties have indicated that they may challenge the legal sufficiency of the jury's award," while BGI plans to appeal the denial of its motion for a new trial and for judgment of a matter of law.

"At this time, MGI is evaluating all its options, including an appeal of those decisions," the firm said.

In Tuesday morning trading on the Nasdaq, shares of Illumina were up 3 percent at $356.26.

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