Free Letter - District Court of Delaware - Delaware

Case 1:04-cv-00901-JJF

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MORRIS, JAMES, HITCHENS & WILLIAMS LLP
222 Delaware Avenue, 10th Floor Wilmington, Delaware 19801-1621 (302) 888-6800 Facsimile (302) 571-1750
www.morrisjames.com Richard K. Herrmann (302) 888-6816 [email protected] Mailing Address P.O. Box 2306 Wilmington, DE 19899-2306

March 29, 2006 VIA ELECTRONIC FILING The Honorable Joseph J. Farnan, Jr. USDC for the District of Delaware 844 King Street Wilmington, DE 19801 Re: Your Honor: On March 16, 2006, Affymetrix informed Illumina for the first time that it intends to add nine previously-unasserted claims (beyond the sixty asserted already) from four of the patents-insuit.1 (See 3/16/06 Reed letter, attached hereto at Ex. A.). This change in course occurred twenty months after Affymetrix filed this suit, twelve months after Affymetrix identified the patent claims that it intended to pursue, five months after the deadline for contention interrogatory responses, and over three weeks after the extended fact discovery deadline. Not surprisingly, Illumina did not conduct discovery on these newly asserted claims, and would be greatly prejudiced if they are allowed to be added at this time. As explained below, Illumina respectfully requests that the Court preclude Affymetrix from seeking to add these new patent claims. Illumina further respectfully requests an expedited ruling on this issue because expert discovery will commence shortly after the Court's Markman ruling. (See 2/17/06 Scheduling Order (setting Markman hearing for April 20, 2006, and opening expert reports deadline for twenty days after a Markman ruling)). I. BACKGROUND. A. Status of Litigation. Affymetrix, Inc. v. Illumina, Inc., D. Del., C.A. No. 04-901-JJF

Affymetrix filed its Complaint in this action on July 26, 2004, alleging infringement of six patents allegedly owned by Affymetrix. Together, these six patents include a total of 160

Specifically, Affymetrix seeks to add claims 2 and 6 for U.S. Patent No. 5,795,716 ("the `716 patent) , claims 10, 21 and 22 for U.S. Patent No. 6,355,432 ("the `432 patent"), claims 18 and 43 for U.S. Patent No. 6,399,365 ("the `365 patent") and claims 52 and 53 for U.S. Patent No. 6,646,243 ("the `243 patent").
Dover (302) 678-8815 Broom Street (302) 655-2599 Newark (302) 368-4200

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claims. In response to Illumina's inquiry, on February 24, 2005, Affymetrix "narrowed" its infringement allegations to sixty claims of the six asserted patents. The parties then conducted extensive written discovery on these sixty claims. Both parties served contention interrogatories on issues of infringement and validity, and each party responded only as to the sixty claims at issue in the case. As of the Court-ordered deadline for contentions, October 14, 2005, the parties had exchanged their contentions as to these sixty claims. The parties then conducted extensive fact deposition discovery -- Affymetrix deposed 32 Illumina and third party witnesses, and Illumina deposed 35 Affymetrix and third party witnesses. As the Court is well aware, much of this discovery by Illumina was contested; indeed, Affymetrix is still attempting to block Illumina's effort to obtain third party discovery from the University of Tennessee Research Foundation. All of Illumina's discovery relating to prior art that invalidates the asserted claims, including inventor depositions and third party depositions of witnesses knowledgeable regarding such art, focused on the asserted claims, not unasserted claims. Prior to the February 24, 2006 close of fact discovery, Illumina served supplemental interrogatory responses, including 535 pages of claim charts establishing the invalidity of the sixty asserted claims. On March 2, 2006, Affymetrix then served supplemental interrogatory responses. Once again, Affymetrix limited its responses to the sixty asserted claims. On March 16, 2006, after the parties had completed this extensive discovery, Affymetrix then sent its letter attempting to expand the scope of its infringement allegations to add new patent claims. B. Affymetrix' March 16, 2006 letter.

As a preliminary matter, Illumina notes that Affymetrix now acknowledges what Illumina has told Affymetrix from the onset of this action; namely, Affymetrix's infringement claims under U.S. Patent No. 6,607,887 ("the `887 Chee patent") are -- and always have been -frivolous.2 In May 2005, Illumina sent a letter to Affymetrix inviting it to dismiss its claim that Illumina infringes the `887 Chee patent or face a motion for sanctions. (See Ex. B). Affymetrix refused to dismiss the `887 Chee patent infringement claim at that time. But now, as disclosed in its March 16, 2006 letter, Affymetrix acknowledges that its infringement claim under the `887 Chee patent is baseless, and dismisses it. (See Ex. A).

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On March 16, 2006, Affymetrix informed Illumina that it intends to dismiss with prejudice its allegation that Illumina infringes one of the asserted patents -- i.e., the `887 patent. (See Ex. A at 1).

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Affymetrix similarly acknowledges that a number of other patent claims that it has asserted have no basis, and has withdrawn its allegation of infringement for those patent claims.3 Illumina, nonetheless, maintains its counterclaims as to those withdrawn claims. Affymetrix' inequitable conduct during the prosecution of those patent claims, their invalidity, and Affymetrix's improper assertion of those claims in this litigation directly support Illumina's counterclaims. In any event, Affymetrix's decision not to pursue infringement allegations for eleven of the 60 asserted claims in no way provides Affymetrix a basis for injecting previously unasserted claims into this action. II. ARGUMENT A. Affymetrix' attempt to add new patent claims at this late stage of the litigation is untimely.

Affymetrix took extensive discovery relating to Illumina's products beginning many months ago. Illumina produced extensive and detailed documentation describing its products prior to October 2005. These documents included catalog lists, product manuals, user guides, and internal product presentations. Affymetrix then deposed several Illumina employees with knowledge regarding Illumina's commercial products in November and December 2005, including but not limited to John Stuelpnagel, D.V.M., Jian-Bing Fan, Ph.D., Francisco Garcia, Ph.D., David Barker, Ph.D., and Todd Dickinson, Ph.D., and questioned them extensively regarding Illumina's commercial products. In its March 16, 2006 letter, Affymetrix contends that it seeks to add these new patent claims "[b]ased in part on information learned" during a Rule 30(b)(6) deposition taken on March 10, 2006, relating to the design, manufacture, and use of Illumina's products. (See Ex. A at 1.). This recent deposition, however, does not justify Affymetrix adding these patent claims now because Affymetrix deposed several Illumina employees extensively regarding Illumina's products several months before this Rule 30(b)(6) deposition. Affymetrix even appears to concede this, stating that it wants to "add" these claims "[b]ased in part" on the March 10, 2006 deposition. The truth is that Affymetrix learned nothing new in that deposition, and is simply using it as an excuse to sandbag Illumina. To try to understand the basis for Affymetrix' thirteenth-hour amendment, Illumina requested that Affymetrix specify the testimony from the March 10 deposition that it believes supports its attempt to change this case by adding new patent claims. (See Ex. C, 3/17/06 Letter from M. Pals to D. Reed). Affymetrix refused to respond to that request. Illumina then sent Affymetrix another letter seeking to meet and confer. (See Ex. D, 3/24/06 Letter from M. Pals to D. Reed). Affymetrix finally responded on March 27, and a meet and confer was held on March
On March 16, 2006, Affymetrix also informed Illumina that it is no longer asserting infringement of claims 18 and 21 of the `243 patent and claims 1, 2, 7, 10, 20, 29, 30, 31 and 32 of the `365 patent. (See Ex. A).
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28 to try to resolve the issue. Affymetrix informed Illumina that it now intends to supplement its interrogatory responses later "this week," but had no suggestion as to how to ameliorate the prejudice to Illumina if the new claims are allowed in the case. Affymetrix cannot justify its attempt to assert new patent claims now. It is simply too late for Affymetrix to expand its infringement allegations, and Affymetrix' effort to do so should be denied. B. Illumina will be prejudiced if Affymetrix is permitted to add these claims at this late stage of the litigation.

Illumina has litigated this case and conducted substantial fact discovery targeted at the specific claims asserted in this case. Affymetrix seeks to add new claims that raise new questions as to patent validity, such as lack of written description, non-enablement, anticipation and obviousness, and patent infringement. These are questions that Illumina did not pursue during discovery because these claims were not at issue in this case. Illumina will be severely prejudiced if Affymetrix is permitted to modify its patent infringement allegations to add new patent claims at this late stage of the litigation. During discovery, Illumina collected prior art and conducted deposition discovery to gather compelling evidence to invalidate each of the asserted claims of the patents in suit. Now that fact discovery is closed, Affymetrix seeks to add new patent claims that add, for example, the following claim limitations: · The `716 Patent: "computer code that calculates a ratio of a higher probe intensity to a lower probe intensity;" "computer code that generates a base call identifying said unknown base according to a base of a nucleic acid probe having said higher probe intensity if said ratio is greater than a predetermined ratio value" (claim 2); The `432 Patent: "the plurality of different beads is reusable" (claim 21); The `365 Patent: "said nucleic acids are attached to said surface through a linker group" (claim 18).

· ·

Illumina should not be forced to defend against new claims and new limitations of which it had no notice and no opportunity to conduct discovery. Nor is it clear that this prejudice could be remedied by an extension to allow Illumina to conduct discovery on these claims. Much of the discovery that Illumina has conducted regarding the evidence on which it relies for patent invalidity is third party discovery, and therefore Illumina's prejudice would remain if third parties successfully objected to Illumina's attempts to pursue additional discovery now. For its part, Affymetrix has repeatedly shown a propensity to object to Illumina's efforts to obtain third party discovery on grounds of alleged untimeliness, such as its recent objections to Illumina's discovery from the University of Tennessee and Dr. Sachleben. (See generally Joint Response of

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Plaintiff Affymetrix, Inc. and Non-Party University of Tennessee Research Foundation to Defendant's Motion to Compel Production of Documents, Case No. 3.06-MC-5 (E.D. Tenn.); see also 3/8/06 Letter from M. Noreika to J. Farnan). Because Affymetrix' attempt to add new patent claims is untimely and without any legitimate justification to overcome the undue prejudice to Illumina that it will cause, Illumina respectfully requests that the Court preclude Affymetrix from asserting new patent claims in this case at this late stage. Respectfully, /s/ Richard K. Herrmann Richard K. Herrmann, I.D. No. 405 [email protected] cc: Dr. Peter T. Dalleo, Clerk of the Court (via electronic filing) MaryEllen Noreika, Esq. (via electronic filing) Michael J. Malecek, Esq. (via email)

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