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In New Twist, ABI Says Patents at Center of Ownership Dispute With Illumina are ‘Void’

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A legal battle between Applied Biosystems and Illumina over who owns patents related to ABI’s SOLiD sequencing technology took new twists recently when ABI declared that the patents are “void and unenforceable” after Illumina claimed ABI infringes the IP.
 
Also, a former ABI patent attorney, being sued by ABI as part of the battle for allegedly failing to assign a related patent application to the firm, next month plans to ask the court to dismiss his former employer’s charge because he “does not have a sufficient stake” in the fight, according to a court filing last week.
 
Over the coming months, the parties are scheduled to file briefings in preparation for a claim construction hearing on Feb. 13, 2008, according to court documents, which showed that a jury trial has been ordered for Sept. 29, 2008.
 
The case began in May when ABI sued Solexa, Illumina, and the former counsel, Stephen Macevicz, over ownership of three Illumina patents related to the SOLiD technology (see In Sequence 6/12/2007). They are US Patent Nos. 5,750,341; 5,969,119; and 6,306,597, all entitled “DNA sequencing by parallel oligonucleotide extensions,” which resulted from a single patent application, No. 08/424,663.
 
All three patents cover sequencing-by-ligation, the technology at the heart of ABI’s new SOLiD next-generation sequencer, which the company officially launched last month.
 
Earlier this month, ABI claimed that the patents “are void and unenforceable by Solexa” because Macevicz “failed to disclose material prior art to the [Patent and Trademark Office] during prosecution of the ‘341, ‘119, and ‘597 patents, even though such prior art was known to the applicant.”
 
Specifically, ABI cited two patents, US Patents No. 4,988,617 and 4,883,750. The ‘617 patent, entitled “Method of detecting a nucleotide change in nucleic acids,” was filed in 1988 by inventors Ulf Landegren and Lee Hood and is assigned to the California Institute of Technology. The patent, which covers the oligonucleotide ligation assay, was granted in 1991, and ABI holds a license to it from Caltech.
 
The ‘750 patent, filed in 1984 and granted in 1989, is entitled “Detection of specific sequences in nucleic acids.” Its inventors are Norman Whitely, Michael Hunkapiller, and Alexander Glazer, and it is assigned to ABI.
 
ABI claims that both patents, which it says “read directly on claims of the ‘341 and ‘597 patents and are also material to claims of the ‘119 patent,” were known to Macevicz at the time he filed his patent application.
 
In particular, ABI cited a letter to Bio-Rad Laboratories in which Macevicz allegedly discussed the patents. “Nonetheless, the applicant failed to disclose these highly material references to the examiners overseeing the prosecution of those applications,” ABI wrote. As a result, the company is “entitled to a judicial declaration that the ‘341, ‘119, and ‘597 patents are unenforceable by Solexa,” ABI’s filing reads.
 
Sequencing by Litigation
 
According to ABI, Macevicz, the company’s former chief patent counsel, filed the application at the heart of the battle in his own name in 1995 while employed at the company. Shortly after the filing, he joined Lynx Therapeutics and assigned the application to his new employer — wrongfully, according to ABI.
 
In its complaint, ABI claims that Macevicz was obliged to assign the patent application to ABI under an employee-invention agreement.
 

ABI alleges the two patents “read directly on claims of the ‘341 and ‘597 patents and are also material to claims of the ‘119 patent.”

Lynx later merged with Solexa, which in turn was acquired by Illumina earlier this year, making Illumina the owner of the patents.
 
ABI also claimed that it only learned in February 2006 about the application and the three patents, which were granted in 1998, 1999, and 2001.
 
Following ABI’s May complaint with the federal court, the three defendants, in two separate documents, filed their answers in mid-August. Along with its answer, Solexa also filed three counterclaims, accusing ABI of infringing those patents.
 
In its answer, Illumina and Solexa denied most of the allegations made by ABI. They also maintained that there was no controversy between the parties “with respect to AB’s infringement of the patents,” even though ABI claimed in its complaint that Solexa was “contending” that Agencourt, which ABI acquired last year, “is engaging or intending to engage in activity for which it needs a license to the ‘597 patent and its related patents.”
 
Illumina also denied “that Macevicz had any ‘fiduciary duties’” to ABI under the invention agreement.
 
Macevicz, in his answer, stated that while he was indeed employed by ABI when he filed the application, the application does not belong to ABI. He said that he “owed his employer [ABI] a duty consistent with the provisions of California Labor Code section 2870” regarding his inventions.
 
That section of the code states that any invention agreement “shall not apply to an invention that the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities, or trade secret information.” It only excludes inventions that either relate “to the employer’s business, or actual or demonstrably anticipated research or development of the employer” or “result from any work performed by the employee for the employer.”
 
Last week, Macevicz informed the parties that he plans to ask the court to order ABI to dismiss the complaint against him, mainly because he “does not have a sufficient stake in the outcome of the controversy.”
 
In its counterclaims, filed along with its answer in August, Solexa asserted that it owns the ‘341, ‘119, and ‘597 patents and accuses ABI of infringing all three of them. And since ABI knew about the patents at least since February 2006, Solexa claims that the alleged infringement has been willful.
 
Solexa seeks to deny ABI “all the relief it seeks in its complaint.” It also seeks a permanent injunction, barring ABI from infringing the patents, as well as damages, attorneys’ fees, and “further relief.”
 
In its September reply to Solexa’s counterclaims, ABI denied that it is liable for patent infringement and maintained that Solexa does not own the three patents.
 
Also that month, the court ordered a claim-construction hearing for Feb. 13, and a jury trial to begin Sept. 29. It also referred the case to a magistrate judge for settlement and mediation, saying in the filing that “such a conference would be more effective in settling the present case than any other avenue.”
 
In October, the court set a briefing schedule leading up to the Feb. 13 claim-construction hearing, starting with an exchange of “proposed terms and claim elements for construction” this week.
 
This month, ABI filed an amended version of its September counterclaim reply, challenging not only the ownership, but also the validity of the patents.
 

Illumina declined to comment for this article. A spokesperson for ABI reiterated by e-mail that the company is “seeking a declaratory judgment that no AB activity infringes these patents and that they in fact belong to Applied Biosystems.”  

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