Stratagene Corporation announced that it was informed that a jury determined that Invitrogen Corporation’s U.S. Patent No. 4,981,797 (issued Jan. 1, 1991) (the ’797 patent) is valid and that Stratagene infringed that patent by making and selling its competent E. coli cell products (Invitrogen Corporation vs. Stratagene; United States District Court for the Western District of Texas).

The jury awarded Invitrogen a 15% royalty rate on sales between the years 1997 and 2004 (for a total of $7.8 million in damages) and found Stratagene to have willfully infringed the patent only between the years 1997 and 2001. The jury found that Invitrogen was not entitled to lost profits because Stratagene has had a non-infringing manufacturing process for competent cells. Stratagene had previously modified its process for manufacturing competent E. coli cell products and Stratagene products sold in recent years and currently offered for sale will not be affected by the jury verdict.

Earlier, the district court granted Stratagene’s motion for summary judgment finding that Invitrogen’s aforementioned patent was not infringed by Stratagene. As we reported, on an earlier remand from the CAFC, the District Court, on summary judgment, determined that Biocrest Manufacturing, L.P., Stratagene Holding Corporation, and Stratagene, Inc. (collectively Stratagene) infringed the ‘797 patent, and that the ’797 patent was not invalid for indefiniteness, although it was invalid because of public use under 35 U.S.C. § 102(b).

The ‘797 patent involves the introduction of foreign, recombinant DNA molecules into receptive E. coli cells to improve the cells’ “competence,” i.e., their ability to take up and establish exogenous DNA and replicate this DNA as they multiply. A cell that accepts alien DNA is called a transformable cell. Claim 1 of the ‘797 patent claims:

A process for producing transformable E. coli cells of improved competence by a process comprising the following steps in order: (a) growing E. coli in a growth-conductive medium at a temperature of 18°C to 32°C; (b) rendering said E. coli cells competent; and (c) freezing the cells.

Stratagene made thirty-four competent E. coli cell lines by a process “including the steps of incubating cells at 37°C, growing the cells in a fermenter at 26°C, and freezing the cells.” Invitrogen sued Stratagene for infringement and the district court construed the claims and then granted Stratagene’s summary judgment motion of non-infringement. Invitrogen appealed, disputing the lower court’s construction of both “improved competence” in the preamble and “growing” in step (a).

The CAFC decided that the trial court had correctly construed the term “improved competence.” The CAFC noted that the term required only a general increase in competence, as compared with that generally obtained when cells are prepared by either (1) growing the cells at 37°C, rendering them competent, and freezing them, or (2) growing the cells at 37°C, rendering them competent, and not freezing them. The CAFC also noted that the trial court had incorrectly construed “growing.” The CAFC then construed that term to permit preparatory steps in advance of step (a), including growth of E. coli at a temperature outside the range in step (a).

On remand, the district court found literal infringement of the ’797 patent; decided that Claim 1 was not indefinite under 35 U.S.C. § 112, 2; and found the claims invalid under the public use provision of 35 U.S.C. § 102(b). In January 2004, the district court granted partial summary judgment to Invitrogen based on the determination that Stratagene’s then-existing manufacturing process infringed Invitrogen’s patent, however the court also determined that Invitrogen’s patent was invalid. Stratagene then changed its manufacturing process for competent cell products to a non-infringing method. Invitrogen appealed the decision again and in October 2005 the Federal Circuit Court reversed the district court’s findings in part stating that ” there is no evidence that Invitrogen received compensation for internally, and secretly, exploiting its cells. The fact that Invitrogen secretly used the cells internally to develop future products that were never sold, without more, is insufficient to create a public use bar to patentability.” The case was remanded back to district court.

The final judgment has not been rendered by the court since it is looking at the appropriateness of the damages determined by the jury and the potential for enhanced damages. Stratagene could still appeal this verdict.

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