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1 INTRODUCTION
2 Qualcomm seeks dismissal of 56 claims: Apple’s and the CMs’
3 declaratory judgment claims for invalidity, non-infringement, determination of
4 a FRAND royalty and exhaustion with respect to the nine patents-in-suit (the
5 “Patent DJs”). That is the only relief Qualcomm seeks. As a matter of well-
6 settled law, those claims have been mooted by Qualcomm’s covenant not to
7 sue. Apple’s1 Opposition focuses almost entirely on other claims that
8 Qualcomm’s Motion does not put at issue. Disputes over issues related to the
9 parties’ other claims and counterclaims—which will be resolved at trial—have
10 no bearing on this Motion.
11 To be clear, Qualcomm’s Motion does not affect the evidence that may
12 be presented to support or rebut those other claims. Both parties will present
13 extensive evidence regarding Qualcomm’s business practices and the value of
14 Qualcomm’s licensed patent portfolio. Qualcomm is in no way “avoiding any
15 discussion of the actual merits” of its patents, as Apple suggests; rather,
16 Qualcomm served reports from fourteen experts addressing dozens of patents.
17 Apple remains free to present evidence about the nine patents-in-suit, if it so
18 chooses. Qualcomm seeks to dismiss only the Patent DJ claims.
19 As explained in Qualcomm’s opening brief, Qualcomm’s broad covenant
20 not to sue removes any threat of infringement claims for the nine patents-in-
21 suit. As a result, this Court does not have jurisdiction over the Patent DJs, and
22 those claims should be dismissed. Apple previously admitted that Qualcomm’s
23 position here is correct: “Qualcomm always has the power to remove the Nine
24 Patents by granting Apple a covenant-not-to-sue pursuant to Super Sack.”
25 (ECF 119 at 18.) Now, faced with Qualcomm’s covenant and Motion, Apple
26 attempts to reverse course. Apple’s three arguments are unpersuasive.
27
28 1
Qualcomm generally refers to Apple and its CMs collectively as “Apple”.
1 First, Apple argues that resolution of the Patent DJs may be relevant to
2 other claims in this case. But declaratory judgment claims are not justiciable
3 when they merely would be “opinion[s] advising what the law would be” about
4 issues that may be in some way relevant to other claims; to be justiciable,
5 declaratory judgment claims must “finally and conclusively resolve the
6 underlying controversy”. MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118,
7 127 n.7 (2007). As this Court has already found, a declaratory judgment ruling
8 on nine patents would resolve nothing here. In particular, a ruling as to the nine
9 patents-in-suit would not have any effect on the validity of the license
10 agreements. Qualcomm’s license agreements cover tens of thousands of
11 patents, and the royalties depend only on the volume of sales of licensed
12 devices. The royalties are not based on the enforceability of any one patent, or
13 any nine patents. Removing nine patents from Qualcomm’s patent portfolio
14 does not change the value of the portfolio.
15 Second, Apple argues that Qualcomm’s “carefully worded” covenant
16 does nothing to prevent Qualcomm from “making claims about [the nine]
17 patents to support its demands”. (Apple Opp’n 1.) Specifically, Apple points
18 to Qualcomm’s expert reports responding to Apple’s allegations about the
19 patents-in-suit. But Qualcomm has continued to address those allegations only
20 because the Court has not yet dismissed the Patent DJs. For the avoidance of
21 doubt, if the Court grants this Motion and dismisses the Patent DJs, Qualcomm
22 will not use the nine patents to prove the value of Qualcomm’s patent portfolio
23 and will withdraw its expert reports to the extent they relate to the nine patents.
24 Third, Apple argues that the Patent DJs on exhaustion (Apple’s
25 Count LIX and CMs’ Count LXVII) should not be dismissed because they
26 cover not only the nine patents-in-suit but also all “patents substantially
27 embodied in baseband processor chipsets sold by Qualcomm to Apple’s CMs”.
28 (Apple Opp’n 12.) That is inconsistent with Apple’s and the CMs’ pleadings
1 and prior filings. The nine patents-in-suit are the only specific patents referred
2 to in the exhaustion counts and the corresponding prayers for relief. Similarly,
3 Apple and the CMs’ pending motion for summary judgment on their exhaustion
4 claims refers, at most, to the nine patents-in-suit. Because Apple’s and the
5 CMs’ exhaustion claims are directed to only the nine patents-in-suit,
6 Qualcomm’s covenant divested the Court of jurisdiction over those claims.
7 Exhaustion is a defense to infringement. Qualcomm has never asserted an
8 infringement claim with respect to the nine patents-in-suit, and now never will.
9 Even under Apple’s new reading—that the exhaustion claims cover all
10 patents substantially embodied in chipsets sold by Qualcomm to the CMs—the
11 claims should still be dismissed as nonjusticiable, because they seek an
12 advisory declaration as to an abstract legal principle. Judge Hayes dismissed a
13 nearly identical claim brought by Broadcom almost a decade ago. Broadcom
14 asked the court to “[d]eclare exhausted the Qualcomm patents that are (or have
15 been) substantially embodied by the chipsets Qualcomm sells”. Broadcom
16 Corp. v. Qualcomm, Inc., 2009 WL 684835, at *5 (S.D. Cal. Mar. 12, 2009).
17 Judge Hayes dismissed that claim because Broadcom, like Apple here under its
18 new reading, failed to identify in its complaint “with any specificity the patents
19 which it requests that the Court declare exhausted”. Id. at *6.
20 Apple’s attempt to complicate this straightforward motion, which relies
21 on settled law, should be rejected, and Apple’s and the CMs’ 56 declaratory
22 judgment claims concerning the nine patents-in-suit should be dismissed.2
23 ARGUMENT
24 I. Apple Previously Has Admitted that the Court Lacks Jurisdiction
over the Patent DJs Under These Circumstances.
25
As Qualcomm explained in its opening brief, the broad covenant
26
Qualcomm gave to Apple and the CMs divests this Court of jurisdiction over
27
2
28 Apple and the CMs do not oppose dismissal of their request for declaratory
judgment of a FRAND rate for the patents-in-suit. (Apple Opp’n 21.)
1 of Qualcomm’s license agreements with the CMs and the amount of royalties
2 owed by the CMs, allow the Court to retain jurisdiction over the Patent DJs.3
3 But that would be true only if resolution of those Patent DJs also would resolve
4 the claims relating to the parties’ broader licensing dispute. (See MTD Order
5 38-39, ECF 167 (reasoning that the CMs must demonstrate that the Court’s
6 ruling would “finally and conclusively resolve the underlying controversy”
7 between the parties).) As this Court already found, when dismissing claims
8 relating to nine other patents last year, resolving individual patent claims would
9 have no impact on the broader disputes in this case.
10 As this Court concluded, the royalties owed by the CMs do not depend
11 on the validity or infringement of any particular patent, “because each
12
13 . Id. at 41;
14 see Verance Corp. v. Digimarc Corp., 2011 WL 2182119, at *6-7 (D. Del. June
15 2, 2011) (invalidity or non-infringement declaration would not eliminate
16 Verance’s obligation to pay royalties because the license agreement did not
17 depend on the patent’s validity; DJ claims dismissed as nonjusticiable). The
18 patents-in-suit are merely nine out of tens of thousands of licensed patents.
19 Rulings as to those nine patents would not invalidate the license agreements or
20 otherwise affect the overall value of Qualcomm’s patent portfolio. As this
21 Court found, “[b]ecause the royalty rates in the SULAs are not contingent on
22 patent invalidity or noninfringement, there is no case or controversy because
23 any declaration of the Nine Additional Patents-in-Suit would not conclusively
24
3
Apple’s Opposition contains many misstatements that do not affect
25 Qualcomm’s Motion but bear mentioning. For example, Apple asserts that
Qualcomm “demanded a royalty for every baseband processor chipset used in
26 every iPhone”. (Apple Opp’n 4.) The plain terms of the CMs’ license
27 agreements apply to licensed devices (e.g., iPhones), not chipsets. Apple also
continues to assert that Lexmark governs Qualcomm’s contract rights pursuant
28 to its license agreements. (Id. at 13-14.) As explained in Qualcomm’s
opposition to Apple’s exhaustion motion, that is incorrect. (ECF 629 at 7-14.)
1 resolve the dispute regarding royalties owed to Qualcomm.” (MTD Order 44.)
2 Apple’s reliance on Esoterix Genetic Laboratories v. Qiagen Inc. is
3 misplaced. Esoterix does not hold, as Apple suggests, that there is jurisdiction
4 over patent DJ claims whenever a concurrent dispute exists about “whether one
5 party owes another payment under a license agreement”. (Apple Opp’n 11.)
6 Esoterix granted to Qiagen a covenant not to sue as to all of the patents upon
7 which Qiagen’s obligation to pay royalties depended, while purporting to
8 reserve the right to enforce Esoterix’s license agreement with Qiagen as to the
9 very patents that were the subject of the covenant.4 2016 WL 4555613 (D.
10 Mass. Aug. 31, 2016), at *5. Esoterix moved to dismiss all of Qiagen’s
11 counterclaims, including claims seeking a declaration that no royalties were
12 owed under the license agreement because all of the relevant patents were
13 invalid. Id. Finding that the Qiagen’s royalty obligations under the license
14 agreement “depend[ed] on whether the underlying patents are valid or invalid”,
15 the Court refused to dismiss Qiagen’s claims. Id. at *3, *5. Esoterix is thus
16 distinguishable on several grounds: (i) Qualcomm’s covenant and Apple’s
17 Patent DJs concern only nine patents, not all of the tens of thousands of patents
18 licensed to the CMs; (ii) Qualcomm is not seeking to dismiss Apple’s other
19 claims as to the CMs’ license agreements; and (iii) this Court already has found
20 that the license agreements do not depend on the validity of a particular patent.
21 Apple likewise misconstrues MedImmune, 549 U.S. 118, claiming that
22 the Supreme Court found a “live contract dispute where the validity of the
23 underlying patent was challenged”. (Apple Opp’n 18.) There is (and will still
24 be) a live contract dispute here too—but not a live dispute about the nine
25 patents. As this Court previously noted, the patent claims and contract claims
26
4
27 The license agreement gave Qiagen rights to five patents for the
manufacture of certain testing kits. Qiagen’s royalty obligation as to those
28 patents ran only so long as the sale of Qiagen’s kits infringed a “valid patent
claim under one of the licensed patents”. (Carlson Decl. Ex. 1 ¶¶ 13-14.)
1 CMs’ summary judgment motion as to their exhaustion claims refers to only the
2 nine patents-in-suit.7 (ECF 600 at 2 n.1, 13.) Because the exhaustion claims
3 are limited to the nine patents-in-suit, Qualcomm’s covenant divested the Court
4 of jurisdiction. “[P]atent exhaustion is a defense to patent infringement, not a
5 cause of action.” ExcelStor, 541 F.3d at 1376. Qualcomm has not brought an
6 infringement claim regarding the patents-in-suit and will never to do so. There
7 is no claim as to which the defense of exhaustion could be asserted.
8 Apple now contends that the exhaustion Patent DJs “extend beyond just
9 the nine patents-in-suit” to “raise a broader case or controversy ‘regarding the
10 exhaustion of Qualcomm’s patent rights with respect to patents substantially
11 embodied in baseband processor chipsets sold by Qualcomm to Apple’s CMs.’”
12 (Apple Opp’n 2.) Assuming the exhaustion claims addressed that broad,
13 unspecified set of patents, the claims would plainly be nonjusticiable. If the
14 claims are construed as encompassing unspecified patents, then the claims are
15 detached from any facts to which the law of exhaustion could be applied. They
16 seek nothing more than an abstract, advisory ruling as to exhaustion as a
17 principle of law—the paradigm of a nonjusticiable question. A court may not
18 provide “an opinion advising what the law would be upon a hypothetical state
19 of facts”. MedImmune, 549 U.S. at 127 (quotation marks omitted); see
20 Gator.com Corp. v. L.L. Bean, Inc., 398 F.3d 1125, 1132 (9th Cir. 2005)
21 (declining to reach the merits of a mooted appeal because to do so “would run
22 squarely afoul of the Supreme Court’s admonition to avoid advisory opinions
23 on abstract propositions of law”) (quotation marks omitted); MTD Order 34-35
24 (“[L]ack of specificity in identifying precise infringing patents weighs severely
25 against finding declaratory judgment jurisdiction”).
26 7
Apple’s Opposition confirms that its Motion for Summary Judgment with
27 respect to the exhaustion claims should be denied. That motion is either moot
because it is directed to three of the nine patents-in-suit (which must be
28 dismissed), or it should be denied because Apple did not present any evidence
that any other patents are substantially embodied in any Qualcomm chip.
QUALCOMM’S MTD REPLY -9- CASE NO. 3:17-CV-0108-GPC-MDD
Case 3:17-cv-00108-GPC-MDD Document 673 Filed 10/12/18 PageID.60845 Page 11 of 13
1 Table of Documents
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-2- Case No. 17-cv-0108-GPC-MDD
DECLARATION OF JAMES W. CARLSON
Case 3:17-cv-00108-GPC-MDD Document 673-2 Filed 10/12/18 PageID.60851 Page 1 of 27
Exhibit 1
Case 3:17-cv-00108-GPC-MDD
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Plaintiff/Counterclaim-Defendant,
CASE No. 14-CV-13228-ADB
and LABORATORY CORPORATION OF
AMERICA HOLDINGS,
Counterclaim-Defendant
v.
Defendants/Counterclaim-Plaintiffs.
response to the Amended Complaint of Plaintiff Esoterix Genetic Laboratories LLC (“EGL”).
ANSWER
1. QIAGEN admits only that this action was styled as one for patent
infringement, violation of the Massachusetts Unfair and Deceptive Trade Practices Act, breach
of contract, and breach of the covenant of good faith and fair dealing. QIAGEN denies all
remaining allegations.
THE PARTIES
as to the truth of the allegations in paragraph 2 of the Amended Complaint, and therefore denies
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such allegations, except it is admitted upon information and belief that EGL’s alleged parent,
Laboratory Corporation of America Holdings, has offices at 358 South Main Street, Burlington,
North Carolina.
3. QIAGEN N.V. is no longer a party to this action, (Dkt. No. 25), so there is
4. QIAGEN GmbH is no longer a party to this action, (Dkt. No. 25), so there
5. QIAGEN GmbH is no longer a party to this action, (Dkt. No. 25), so there
action, (Dkt. No. 25), so therefore there is no obligation to answer this allegation.
action, (Dkt. No. 25), so therefore there is no obligation to answer this allegation.
9. Admitted.
10. Admitted.
11. Denied.
12. Admitted.
13. Denied.
14. Denied.
2
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15. QIAGEN admits only that the quote is in paragraph 10(g) of the 2008
license agreement currently between EGL and QIAGEN Manchester (the “License Agreement”).
16. Admitted.
THE FACTS
between non-party Genzyme Corporation and non-party DxS from 2008. QIAGEN refers to that
19. QIAGEN admits that certain EGFR mutations are predictive of the
efficacy of certain chemotherapeutic treatments for lung cancer and other diseases.
20. QIAGEN admits only that to the extent there are any rights or obligations
under the License Agreement, they were assumed by QIAGEN Manchester, and denies all
remaining allegations.
as to the truth of the allegations in paragraph 21 of the Amended Complaint, and therefore denies
such allegations.
as to the truth of the allegations in paragraph 22 of the Amended Complaint, and therefore denies
such allegations.
3
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as to the truth of the allegations in paragraph 23 of the Amended Complaint, and therefore denies
such allegations.
required. To the extent the allegations purport to be factual, QIAGEN is without knowledge or
information sufficient to form a belief as to the truth of the allegations, and therefore denies such
allegations.
25. QIAGEN admits only that the License Agreement purports to grant a non-
exclusive sublicense to the Patent Rights, and denies all remaining allegations.
26. Denied.
27. QIAGEN admits only that the quoted language appears in the License
Agreement, but QIAGEN refers to the document itself and denies any averment about it.
28. QIAGEN admits only that the quoted language appears in the License
Agreement, but QIAGEN refers to the document itself and denies any averment about it.
29. QIAGEN denies the allegation and refers to Section 1.9 of the License
Agreement.
30. Denied.
31. QIAGEN denies the allegation and edited quotation, and refers to Section
32. Denied.
33. Denied.
34. QIAGEN admits only that QIAGEN paid royalties to EGL and its
predecessors during the term of the License Agreement, and denies all remaining allegations.
4
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35. Denied.
36. Denied.
37. QIAGEN admits only that it obtained a regulatory approval for its EGFR
38. Denied.
39. Denied.
40. QIAGEN admits only that a very small percentage of its Test Kits were
sold to third parties located in Massachusetts, and denies all remaining allegations.
41. QIAGEN admits only that QIAGEN has communicated with EGL and
LabCorp regarding the License Agreement, and denies all remaining allegations.
42. Admitted.
43. Denied.
44. Denied.
COUNT I
PATENT INFRINGEMENT
46. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
47. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
48. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
5
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49. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
50. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
51. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
52. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
53. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
54. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
55. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
56. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
57. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
58. In light of the Court’s September 25, 2015 Memorandum and Order
dismissing EGL’s claims for patent infringement, QIAGEN need not respond to this allegation.
COUNT II
6
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60. Admitted.
61. Denied.
62. Denied.
63. Denied.
64. Denied.
65. Denied.
66. Denied.
67. Denied.
68. Denied.
69. Denied.
70. Denied.
71. Denied.
72. Denied.
COUNT III
BREACH OF CONTRACT
74. Denied.
75. Denied.
76. Denied.
77. Denied.
78. Denied.
7
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COUNT IV
80. Denied.
81. Denied.
82. Denied.
83. Denied.
84. Denied.
85. Denied.
86. Denied.
87. Denied.
88. Denied.
89. Denied.
90. Denied.
91. Denied.
QIAGEN denies that EGL is entitled to any of the relief requested, and/or any
other relief.
8
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GENERAL DENIAL
Pursuant to Rule 8(b)(3) of the Federal Rules of Civil Procedure, QIAGEN denies
each and every allegation in the Complaint that it has not expressly admitted, specifically
AFFIRMATIVE DEFENSES
affirmative defenses:
EGL’s Amended Complaint fails to state a claim on which relief can be granted.
EGL’s claims are barred in whole or in part by the doctrine of unclean hands.
EGL’s claims and claims for damages are barred in whole or in part by Section
EGL’s claims are barred because they seek to enforce, or rely on, contract
provisions that, without a valid patent, improperly restrain commerce or otherwise provide EGL
with greater rights that it is entitled to under the federal patent laws.
EGL’s claim under MGL chapter 93A is barred because the conduct alleged to
9
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violate the statute did not occur “primarily and substantially” in the Commonwealth of
Massachusetts.
EGL’s claims are barred in whole or in part because there is no liability as alleged
by EGL because QIAGEN’s EGFR test kits do not, but for the License Agreement, infringe a
for U.S. Patent Nos. 7,964,349 (“the ’349 patent”), 8,105,769 (“the ’769 patent”), 8,465,916
protest since QIAGEN first notified EGL that the ’468 patent and the other licensed U.S. patents
3. Finally, QIAGEN seeks relief from LabCorp and EGL for their improper
communications with QIAGEN’s customers, which intentionally and improperly interfered with
PARTIES
place of business at Skelton House, Lloyd Street North, Manchester, United Kingdom.
10
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5. QIAGEN Inc. is organized under the laws of California with its principal
Delaware, with its principal place of business at 3400 Computer Drive, Westborough, MA
01581.
alleges herein upon information and belief, that EGL is a wholly-owned subsidiary of LabCorp, a
corporation organized under the laws of the State of Delaware with its principal place of business
at 358 South Main Street, Burlington, North Carolina. (EGL and LabCorp are collectively
pursuant to 28 U.S.C. §§ 1331, 1332(a), 1338(a), and 1367, and the Declaratory Judgment Act,
28 U.S.C. §§ 2201 and 2202. The amount in controversy for QIAGEN’s counterclaims exceeds
GENERAL ALLEGATIONS
10. Upon information and belief, the General Hospital Corporation (“GHC”)
and the Dana-Farber Cancer Institute, Inc. (“DFCI”) are co-owners by assignment of the ’468,
11. Upon information and belief, GHC and DFCI granted an exclusive license
to EGL’s predecessor Genzyme that includes rights to the ’468, ’349, ’769, ’916, and ’036
patents.
11
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12. EGL has alleged and represented to the Court that it has “all right, title and
interest” in the ’468 patent and its “related” patents, including upon information and belief, the
’349, ’769, ’916, and ’036 patents that are “related” because they claim priority to the application
that issued as the ’468 patent. Thus, upon information and belief and based on EGL’s allegations
and representations, EGL has “all right, title and interest” to the ’349, ’769, ’916, and ’036
patents.
13. In 2008, EGL’s predecessor entered into the License Agreement with
QIAGEN’s predecessor. The License Agreement purports to grant rights to QIAGEN in the
’468, ’349, ’769, ’916, and ’036 patents (collectively “the licensed patents”) to manufacture and
sell Epidermal Growth Factor Receptor mutation testing kits (“EGFR test kits”) that were
14. Under the License Agreement, QIAGEN is only required to pay royalties
for sales of its EGFR test kits that but for the License Agreement “cannot be manufactured, used,
offered for sale or sold, in whole or in part, without infringing” a valid patent claim under one of
15. QIAGEN has provided notice to EGL that it believes that the ’468, ’349,
16. Although QIAGEN believes the licensed patents are invalid, QIAGEN has
continued to make royalty payments under the License Agreement under protest with the right to
recoup such royalty payments if and when a court agrees that the licensed patents are invalid.
17. In this action, EGL has alleged that QIAGEN has infringed the ’468
patent.
12
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18. In addition to the ’468 patent, EGL and LabCorp threatened QIAGEN’s
customers with patent infringement of at least the ’349 and ’769 patents.
19. There is an actual and justiciable case or controversy that exists between
QIAGEN and EGL regarding whether making, using, and selling QIAGEN’s EGFR test kits
infringe a valid claim of the ’349, ’769, ’916, and ’036 patents, and thus whether QIAGEN is
obligated to pay royalties on the sales of its EGFR test kits in the U.S.
The Court Has Effectively Invalidated the ’349, ’769, and ’916 Patents
20. In a September 25, 2015 Memorandum and Order, this Court held that the
21. The issues of invalidity are legally identical as between the ’468 patent
22. The issues determinative of the invalidity of the ’349, ’769, and ’916
patents were actually litigated in this action by the same parties and were decided by this Court’s
23. All such issues were necessary to the Court’s decision in this matter.
24. Because the issues of invalidity are identical, the Court’s September 25,
2015 Memorandum and Order, effectively invalidated not only the ’468 patent, but also the ’349,
EGFR test kits that were covered by the licensed patents. EGL gave QIAGEN a license to sell
26. The License Agreement covers only QIAGEN’s EGFR test kits that, but
for the License Agreement, would infringe any valid claim of any of the licensed patents.
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Neither EGL nor its predecessors provided any know-how, teachings or materials to QIAGEN or
its predecessors to help it build its kits. Rather, EGL simply provided a license to the licensed
patents—patents that QIAGEN herein alleges are patent ineligible under Section 101 of the U.S.
Patent Act.
27. During the course of the parties’ performance under the License
Agreement through 2013, LabCorp requested, and QIAGEN sold its EGFR test kits to LabCorp.
28. Upon information and belief, there came a time when EGL and LabCorp
29. Thus, Counterclaim Defendants EGL and LabCorp used improper means
to injure QIAGEN by, among other things, improperly threatening QIAGEN’s customers with
patent infringement of the licensed patents, to injure QIAGEN’s existing and prospective
letters (“Interference Letters”) to third parties that it knew had purchased EGFR test kits from
QIAGEN.
31. The Interference Letters listed the licensed patents, and stated that
“LabCorp has license rights to these patents as well as other pending U.S. patent applications.
Currently, LabCorp provides laboratory testing services under these patent rights, including
testing for clinical diagnostic use.” The Interference Letters told the recipient to review the
enclosed patents and to discuss with LabCorp. The Interference Letters intentionally and
improperly failed to mention that LabCorp knew that the recipient of the Interference Letter had
purchased its EGFR test kits from QIAGEN, or that LabCorp’s subsidiary EGL has licensed
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32. The Counterclaim Defendants continued to send such letters even after the
date of the FDA’s first approval of QIAGEN’s kits in July 2013, after which even EGL concedes
in its Amended Complaint that QIAGEN had full rights to sell the kits to customers for all
licensed uses. (QIAGEN contends that all of its sales before and after July 2013 were permitted
33. The Interference Letters were improper in motive or means in that they did
not mention QIAGEN’s license, and in that they were designed to deter third parties from doing
QIAGEN’s existing and prospective contracts for sales of EGFR test kits by inducing customers
to breach existing contracts with QIAGEN to purchase EGFR test kits or by causing such
COUNT I
DECLARATORY JUDGMENT ON CONTRACTUAL RIGHTS AND OBLIGATIONS
(QIAGEN Manchester against EGL)
36. There is an actual and justiciable case or controversy that exists between
QIAGEN Manchester and EGL concerning the rights and obligations of QIAGEN under the
37. QIAGEN Manchester has provided notice to EGL that it believes that it
does not owe any royalties for any U.S. sales because the U.S. licensed patents (the ’468, ’349,
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38. In a September 25, 2015 Memorandum and Order, this Court held that the
seeking a declaratory judgment that the remaining U.S. licensed patents (the ’349, ’769, ’916,
also seeking a declaratory judgment that QIAGEN’s EGFR test kits do not infringe the
remaining U.S. licensed patents (the ’349, ’769, ’916, and ’036 patents).
COUNT II
DECLARATORY JUDGMENT OF INVALIDITY OF THE ’349 PATENT
(QIAGEN Manchester against EGL)
44. The ’349 patent is invalid for failing to comply with one or more of the
provisions of the United States Patent Action, 35 U.S.C. § 1 et seq., including but not limited to
45. The issues determinative of whether the ’349 patent is invalid under 35
U.S.C. § 101 as claiming an unpatentable natural law were actually litigated in this action and
were effectively decided by this Court’s September 25, 2015 Memorandum and Order.
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46. Declaratory relief is both appropriate and necessary to establish that the
’349 patent is invalid, and thus QIAGEN Manchester is entitled to restitution of royalties paid
and does not owe future royalties under the License Agreement for U.S. sales, and to prevent the
assertion of the ’349 patent against QIAGEN or its customers in the future.
COUNT III
DECLARATORY JUDGMENT OF INVALIDITY OF THE ’769 PATENT
(QIAGEN Manchester against EGL)
49. The ’769 patent is invalid for failing to comply with one or more of the
provisions of the United States Patent Action, 35 U.S.C. § 1 et seq., including but not limited to
50. The issues determinative of whether the ’769 patent is invalid under 35
U.S.C. § 101 as claiming an unpatentable natural law were actually litigated in this action and
were effectively decided by this Court’s September 25, 2015 Memorandum and Order.
51. Declaratory relief is both appropriate and necessary to establish that the
’769 patent is invalid, and thus QIAGEN Manchester is entitled to restitution of royalties paid
and does not owe future royalties under the License Agreement for U.S. sales, and to prevent the
assertion of the ’769 patent against QIAGEN or its customers in the future.
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COUNT IV
DECLARATORY JUDGMENT OF INVALIDITY OF THE ’916 PATENT
(QIAGEN Manchester against EGL)
54. The ’916 patent is invalid for failing to comply with one or more of the
provisions of the United States Patent Action, 35 U.S.C. § 1 et seq., including but not limited to
55. The issues determinative of whether the ’916 patent is invalid under 35
U.S.C. § 101 as claiming an unpatentable natural law were actually litigated in this action and
were decided by this Court’s September 25, 2015 Memorandum and Order.
56. Declaratory relief is both appropriate and necessary to establish that the
’916 patent is invalid, and thus QIAGEN Manchester is entitled to restitution of royalties paid
and does not owe future royalties under the License Agreement for U.S. sales, and to prevent the
assertion of the ’916 patent against QIAGEN or its customers in the future.
COUNT V
DECLARATORY JUDGMENT OF INVALIDITY OF THE ’036 PATENT
(QIAGEN Manchester against EGL)
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59. The ’036 patent is invalid for failing to comply with one or more of the
provisions of the United States Patent Action, 35 U.S.C. § 1 et seq., including but not limited to
60. Declaratory relief is both appropriate and necessary to establish that the
’036 patent is invalid and thus QIAGEN Manchester is entitled to restitution of royalties paid
and does not owe future royalties under the License Agreement for U.S. sales, and to prevent the
assertion of the ’036 patent against QIAGEN or its customers in the future.
COUNT VI
DECLARATORY JUDGMENT OF NON-INFRINGEMENT OF THE LICENSED
PATENTS
(QIAGEN against EGL)
QIAGEN and EGL concerning whether QIAGEN’s EGFR test kits infringe any valid claim of
63. Even absent QIAGEN’s rights under the License Agreement, QIAGEN’s
EGFR test kits do not infringe, in whole or in part, either directly, indirectly, contributorily, or by
inducement, the claims of the remaining U.S. licensed patents (the ’349, ’769, ’916, and ’036
QIAGEN’s EGFR kits do not infringe the licensed patents and thus QIAGEN is entitled to
restitution of royalties paid and does not owe future royalties under the License Agreement for
U.S. sales, and to prevent the assertion of the licensed patent against QIAGEN or its customers
in the future.
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COUNT VII
RESTITUTION OF ROYALTIES PAID
(QIAGEN Manchester against EGL)
66. No later than October 31, 2014, via the filing of its motion to dismiss
EGL’s claim of infringement of the ’468 patent in this action, QIAGEN Manchester gave notice
to EGL that it believed the ’468 patent was invalid under section 101 of the U.S. Patent Act. This
notice also provided constructive notice of QIAGEN Manchester’s position as to the invalidity
under U.S. law of the ’349, ’769, and ’916 patents as well, as the claims of those patents are
believes that the ’468, ’349, ’769,’916, as well as the ’036 patent, are invalid and unenforceable
under U.S. law, and that it was making payment of its U.S. royalties under protest and objection.
68. In a September 25, 2015 Memorandum and Order, this Court held that the
69. The issues of invalidity are identical as between the ’468 patent and the
70. The issues determinative of the invalidity of the ’349, ’769, and ’916
patents were actually litigated in this action and were decided by this Court’s September 25,
71. All such issues were necessary to the Court’s decision in this matter.
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72. Because the issues of invalidity are identical, the Court’s September 25,
2015 Memorandum and Order, effectively invalidated not only the ’468 patent, but also the ’349,
73. QIAGEN Manchester has also sought a declaratory judgment that the’036
patent is invalid and that the remaining U.S. licensed patents (the ’349, ’769, ’916, and’036
74. QIAGEN Manchester is entitled to recover its royalties paid for U.S. sales
COUNT VIII
TORTIOUS INTERFERENCE WITH CONTRACTUAL RELATIONSHIPS
(QIAGEN against LabCorp and EGL)
76. During the term of the License Agreement, customers had contracts and
77. Upon information and belief the Counterclaim Defendants knew of the
existence of such business relationships between QIAGEN and third parties to purchase EGFR
test kits. The Counterclaim Defendants further knew that QIAGEN reasonably expected to
continue to sell EGFR test kits to these same customers in the future.
Letters to third parties to disrupt QIAGEN’s contractual relationships with its customers, and
intentionally induce those customers not to perform their obligations under the contracts.
improper in means or motive in light of its failure to note QIAGEN’s rights under the License
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Agreement, and the Counterclaim Defendants’ implication that customers were violating the
Letters that QIAGEN was licensed to sell the EGFR test kits at the time the Interference Letters
were sent constitutes improper means or motive as well as malicious behavior on the part of the
Counterclaim Defendants.
improper in means or motive as it was done to harm its competition and its licensee, QIAGEN,
COUNT IX
TORTIOUS INTERFERENCE WITH PROSPECTIVE BUSINESS RELATIONSHIPS
(QIAGEN against LabCorp and EGL)
84. During the term of the License Agreement, customers had purchased
to third parties of EGFR test kits. The Counterclaim Defendants further knew that QIAGEN
reasonably expected to continue to sell EGFR test kits to these same customers in the future.
86. The Interference Letters were sent to third parties to disrupt QIAGEN’s
contractual relationships with its customers, and induce those customers to not engage in future
improper in means or motive in light of its failure to note QIAGEN’s rights under the License
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Agreement, and the Counterclaim Defendants’ implication that customers would violate the
Letters that QIAGEN was licensed to sell the EGFR test kits at the time the Interference Letters
were sent constitutes improper means or motive as well as malicious behavior on the part of the
Counterclaim Defendants.
improper in means or motive as it was done to harm its competition and its licensee, QIAGEN,
(a) A judgment declaring the ’349, ’769, ’916, and ’036 patents
invalid.
royalties paid under the License Agreement since at least October 31, 2014.
this case is “exceptional” under 35 U.S.C. § 285 or to the extent allowed under applicable
law.
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QIAGEN hereby demands a jury trial on all issues so triable both in EGL’s
Dated: October 23, 2015 QIAGEN Inc. and QIAGEN Manchester, Ltd.,
By their attorneys,
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CERTIFICATE OF SERVICE
I hereby certify that I caused the foregoing document to be filed through the Court’s ECF
system and that it will be sent electronically to the registered participants as identified on the
Notice of Electronic Filing, and paper copies will be sent to those indicated as non-registered
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Case 3:17-cv-00108-GPC-MDD Document 673-3 Filed 10/12/18 PageID.60878 Page 1 of 1
1 CERTIFICATE OF SERVICE
2 The undersigned hereby certifies that a true and correct copy of the
3 above and foregoing document has been served on October 12, 2018, to all counsel
4 of record who are deemed to have consented to electronic service via the Court’s
5 CM/ECF system per Civil Local Rule 5.4(d). Any other counsel of record will be
6 served by electronic mail, facsimile and/or overnight delivery.
7 I certify under penalty of perjury that the foregoing is true and correct.
8 Executed on October 12, 2018, at New York, New York.
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10 By: /s/ Evan R. Chesler ________________
Evan R. Chesler
11 echesler@cravath.com
Attorneys for Defendant and
12 Counterclaim-Plaintiff
QUALCOMM
13 INCORPORATED
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CERTIFICATE OF SERVICE Case No. 17-cv-0108-GPC-MDD