Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_16-cv-02788/USCOURTS-cand-3_16-cv-02788-20/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:145 Patent Infringement

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

ILLUMINA, INC, and ILLUMINA

CAMBRIDGE LTD.,

Plaintiffs,

 v.

QIAGEN N.V., QIAGEN GmbH, QIAGEN

GAITHERSBURG, INC., QIAGEN

SCIENCES, LLC, QIAGEN INC. (USA),

QIAGEN REDWOOD CITY, INC., AND

INTELLIGENT BIO-SYSTEMS, INC.,

Defendants. /

No. C 16-02788 WHA

ORDER GRANTING IN PART

AND DENYING IN PART

MOTION TO STAY

PRELIMINARY INJUNCTION

An order granted Illumina’s motion for a preliminary injunction (Dkt. No. 120). Qiagen

moves to stay the preliminary injunction pending its expedited appeal of the order. 

Alternatively, defendants seek to stay the order in part as to (i) manufacturing the Gene Reader

devices in the United States for sales outside the country and (ii) sales of nucleotides to existing

customers using the Gene Reader device.

In seeking a stay of the injunction as a whole, Qiagen argues that the order granting the

injunction inadequately addressed certain points raised in opposition to Illumina’s motion. 

Although Qiagen’s arguments largely revisit arguments already rejected in the order granting

Illumina’s motion for the preliminary injunction, two points are worth addressing here. 

First, Qiagen argues that the order granting the preliminary injunction ignored the fact

that the Federal Circuit found that it was of “no moment” that the prior art reference to azido

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United States District Court

For the Northern District of California

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groups challenged therein taught that they would be removed with low efficiency (while the

sequencing method taught by Ju and Tsien required high efficiency) because the claimed

invention did not require removal. Critically, however, the Federal Circuit found that fact fatal

to the claimed motivation to combine those references in the first place. Intelligent Bio-Sys.,

Inc. v. Illumina Cambridge Ltd., 821 F.3d 1359, 1367 (Fed. Cir. 2016).

Here, Qiagen pointed to the declaration of its expert, Dr. Michael Metzker, in which he

asserted that a skilled artisan would have been motivated to consult the chapters of Greene &

Wuts concerning lower-efficiency protecting groups (including azido groups) when adapting Ju

or Tsien for the purpose of labeling. Metzker asserted that “[w]hile efficient removal for the

3'-OH protecting group would always be desirable, a method of labeling would not require the

high yield or quantitative (i.e. high efficiency) removal discussed in Ju and Tsien in the context

of using the labeled nucleotide for sequencing” (Metzker Decl. ¶ 71). Nevertheless, he failed to

state that at the time of the ’537 patent a skilled artisan would have appreciated that fact,

ignored that limitation in Ju or Tsien, and therefore looked beyond the aliphatic alcohols

chapter in Green & Wuts to the chapter on phenols. Accordingly, it remains unlikely that

Qiagen will succeed in clearly and convincingly showing that the ’537 patent is obvious in light

of Ju or Tsien and Greene & Wuts.

Second, Qiagen continues to assert its inconsistent position that this injunction will

cause it irreparable harm while Illumina will suffer no irreparable harm absent the injunction. 

Although lost sales are possibly quantifiable, the order rested on the fact that Qiagen sought to

redefine the market with disruptive pricing models at a crucial inflection point in the market. 

That risk remains a sufficient basis for denying Qiagen’s request to stay the preliminary

injunction as a whole.

On the other hand, Qiagen’s request to stay the injunction as to its current customers

does not pose as sharp a risk. Illumina’s lost sales to those customers are easily quantifiable,

and any irreparable harm in shifting those customers’ expectations about pricing models has

already been done. Moreover, the public interest and equity in allowing Qiagen’s current

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For the Northern District of California

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customers to continue to provide gene sequencing services without purchasing an entirely new

system from Illumina favor staying the injunction as to those customers pending Qiagen’s

appeal. 

Separately, Qiagen seeks clarification that the preliminary injunction does not preclude

it from manufacturing the Gene Reader for the purpose of sales abroad. Qiagen argues that

because the ’537 patent claims a method, simply manufacturing the Gene Reader in the United

States would not infringe the patent. Illumina agrees, provided that Qiagen does not perform

quality control testing in the United States. (Qiagen avers it does not.) Illumina opposes

Qiagen’s request to clarify the scope of the objection solely because Qiagen did not object to

the scope of Illumina’s proposed order (which the order granting the preliminary injunction

largely adopted). 

Neither side briefed the proper scope of the injunction, and the Court will not hold

Qiagen responsible for that failure. Thus, this order clarifies that the injunction does not extend

to the manufacture of Qiagen’s Gene Reader products for sale abroad, provided the quality

control testing does not occur in the United States.

Accordingly, Qiagen’s motion to stay the preliminary injunction in full is DENIED, but

its motion is GRANTED as to supplying nucleotides to its existing customers — including

customers that had already begun Qiagen’s so-called “try and buy” program — and as to

manufacturing in the United States for sales abroad. 

IT IS SO ORDERED.

Dated: September 22, 2016. WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

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