Free Motion for Summary Judgment - District Court of California - California

Case 3:07-cv-02294-L-BLM

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Dan Lawton (State Bar No. 127342) Joseph C. Kracht (State Bar No. 228507) Matt Valenti (State Bar No. 253978) LAWTON LAW FIRM 550 West C Street, Suite 1400 San Diego, CA 92101 (619) 595-1370 (619) 595-1520 (Telefacsimile Number) [email protected] (electronic mail) Attorneys for Plaintiff AntiCancer, Inc.

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF CALIFORNIA

ANTICANCER, INC., a California corporation,

) ) ) Plaintiff, ) ) v. ) ) TECO DIAGNOSTICS, a California ) corporation; KC CHEN, a natural person; ) TONG CHIAH, a natural person; JIAN ) YANG VAECHES, a natural person; and ) DOES 1-30, ) ) Defendants. ) ) _________________________________ ) I, Robert M. Hoffman, declare: 1.

Case No. 07CV2294L (BLM) DECLARATION OF ROBERT M. HOFFMAN IN SUPPORT OF MOTION OF PLAINTIFF ANTICANCER, INC. FOR PARTIAL SUMMARY JUDGMENT OF PATENT INFRINGEMENT BY DEFENDANT TECO DIAGNOSTICS Date: Time: Place: Judge: July 21, 2008 10:30 a.m. Courtroom 14 Hon. M. James Lorenz

Background. I am the founder and President of AntiCancer, Inc. A current

copy of my curriculum vitae accompanies this declaration. AntiCancer is a small, locallyheadquartered company. One of AntiCancer's patented technologies is an enzymatic homocysteine assay and a kit for using it (referred to as the "HA Kit"). The FDA has granted AntiCancer clearance to market the HA Kit; it does so through A/C Diagnostics, its whollyowned subsidiary. ///

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2.

Homocysteine is an amino acid that plays a critical role in heart disease and

stroke, and may be more important to monitor than cholesterol to prevent heart disease. Excess homocysteine is a major risk factor for heart attacks, as well as diabetes, neurodegenerative diseases, birth defects, and other serious health problems. AntiCancer developed the HA Kit as a way to detect levels of homocysteine. The kit uses genetically engineered homocysteine enzyme and a diagnostic reader to measure homocysteine levels in blood plasma and serum. 3. AntiCancer licenses to others the right to use its HA Kit. Its patents claim the

kit and the method for using it (as well as the method to measure homocysteine). When a user measures homocysteine levels using the HA Kit without a license, AntiCancer's pertinent patents are implicated. These are the `191, `467, `102, `446, and `762 patents (Exs. B, C, D, E, and F), and equivalents worldwide. AntiCancer has to and does protect its patents vigorously. This is because of those patents' dear value to the company and its customers. 4. Infringement by Teco Diagnostics. In August 2006, Teco's product manager,

Tong Chiah, contacted me and expressed interest in the HA Kit. In particular, Mr. Chiah was interested in developing a business relationship whereby Teco would market and sell the HA Kit in conjunction with an analyzer machine used by Teco. At that time, the only instruments used with the HA Kit were the Hitachi 912 and AntiCancer's own portable reader. AntiCancer was interested in working with Teco to extend the use of its assay kits to other machines, including the Beckman Synchron CX. 5. Teco proposed an agreement calling for AntiCancer to sell two hundred and

fifty HA Kits to Teco per month, for a term of one year, at $1.10 per test (with 100 tests per kit). Teco also proposed that the agreement cover a 25-state territory. On behalf of AntiCancer, I rejected the initial proposal and offered instead fifty HA Kits a month within the state of California. Teco agreed and accommodated these changes. 6. As negotiations continued, Mr. Chiah requested that AntiCancer ship two kits

to Teco, so that the kits could be tested on Teco's Beckman Synchron CX machine. Before

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shipping the kits, AntiCancer insisted that Teco sign a confidential non-disclosure agreement. On September 21, 2006, Dr. K.C. Chen, Teco's president, and I signed the confidentiality agreement. Ex. A. 7. During the month of October and early November 2006, AntiCancer exchanged

with Teco various materials related to the HA Kit. These included: reagents from the HA Kit to Teco for evaluation (sent by AntiCancer to Teco on October 2); an e-mail to Tong Chiah containing information about the portable reader (sent by AntiCancer to Teco on October 17); a purchase order from Teco for one 100-test HA Kit and one portable reader (received by AntiCancer from Teco on October 18); additional reagents and calibrators to Teco for evaluation purposes after Tong Chiah informed AntiCancer they were out (sent by AntiCancer to Teco on October 24); special HA Kit tubes for the portable reader to Teco's Jian Yang Vaeches (sent by AntiCancer to Teco on October 31 at Ms. Vaeches' request); and another free HA Kit sent by AntiCancer to Teco at its request because Teco had again stated that it was out and needed the kit for evaluation purposes (sent November 7). 8. Afterward, Tong Chiah told AntiCancer in December 2006 that Teco was not

interested in buying or licensing AntiCancer's enzymatic homocysteine assay. There were no further negotiations between AntiCancer and Teco. 9. In approximately July 2007, AntiCancer's Chinese partner in marketing

AntiCancer's A/C enzymatic homocysteine assay told me that Teco's website was advertising our assay labeled as Teco's. I immediately visited Teco's website, www.tecodiag.com, and read the release. See Ex. G. It stated that Teco has a "Patented Homocysteine Assay Given FDA Approval in the Fight Against Cardiovascular Disease." The release, dated November 9, 2006 (just two days after AntiCancer sent Teco a free HA Kit), stated Teco also had a patent for homocysteine detection, and explained the detection process. 10. The process outlined in the release describes exactly AntiCancer's

homocysteine assay covered by all of the steps contained in AntiCancer's patents `191, `467, `102, and `762. See Ex. H. This is a clear infringement of those patents.

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11.

In July 2007, I attended the 2007 American Association for Clinical Chemistry

meeting in San Diego. At the Teco booth, I saw a flyer being handed out. Exs H, I. Later, I heard Teco personnel admit that they had handed out the flyer months before, at the Medica Meeting in Dusseldorf, Germany in November 2006 (which I also had attended). These are the two biggest and most important diagnostics meetings in the world and their flyers were seen by potentially more 100,000 attendees. 12. The flyer exactly describes AntiCancer's HA Kit and reader. In the picture on

the flyer, the bottles and vials shown are still labeled with the name of AntiCancer's assay: "A/C Enzymatic HCY Assay." The reader shown in the flyer picture bears the name "HyTek 205," as it was when we originally provided the HA Kit and the reader for Teco to try. Exs. I, J. This also clearly demonstrates that Teco is infringing AntiCancer's `191, `467, `102, and `762 patents. 13. Set forth below is a list of exhibits appended to the Lawton Declaration. Each

copy is a true and correct copy of the original. EXHIBIT LETTER A B C D E F G H DESCRIPTION Confidential Disclosure Agreement between Teco Diagnostics and AntiCancer, Inc. (signed September 21, 2006) United States Patent No. 5,998,191 (December 7, 1999) United States Patent No. 6,066,467 (May 23, 2000) United States Patent No. 6,140,102 (October 31, 2000) United States Patent No. 6,448,446 (September 10, 2002) United States Patent No. 6,468,762 (October 22, 2002) Printout from website of Teco Diagnostics, "Patented Homocysteine Assay Given FDA Approval in the Fight Against Cardiovascular Disease" (undated) Graphic accompanying release by Teco Diagnostics, "Homocysteine," with color photographs and written "Procedure" and "Specifications" sections (undated) Brochure flyer distributed by Teco Diagnostics, "Homocysteine," with color photograph (undated) Brochure flyer distributed by Teco Diagnostics, with color photograph, zoomed to show detail (undated)

I J

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EXHIBIT LETTER K

DESCRIPTION AntiCancer, Inc.'s Disclosure of Asserted Claims and Preliminary Infringement Contentions Against Teco Diagnostics (March 31, 2008) I declare under the pains and penalty of perjury under the laws of the United

14.

States that the foregoing is true and correct and that I have executed this declaration this 8th day of May, 2008 at San Diego, California.

s/ Robert M. Hoffman Robert M. Hoffman

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