Diagnostics Giant Quest Files Declaratory Judgment Action against Myriad Genetics

by McDonnell Boehnen Hulbert & Berghoff LLP
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Quest DiagnosticsMyriad is facing yet another challenge to its remaining BRCA gene testing franchise, this time from Quest Diagnostics joined by its R&D arm, Nichols Institute.  Quest is "the world's leading provider of diagnostic information services, and is a pioneer in developing innovative diagnostic tests and advanced healthcare information technology solutions that help improve patient care" according to its complaint, having operations in the U.S., the U.K., Mexico, Brazil, Puerto Rico, and India, and 43,000 employees worldwide.  This company is thus very different from the more traditional genomics companies like Ambry Genetics, Gene-by-Gene, and Counsyl.

Quest filed suit in the Central District of California seeking a declaratory judgment of invalidity and non-infringement for the following Myriad patents:  U.S. Patent Nos. 5,654,155; 5,693,473; 5,709,999; 5,710,001; 5,747,282; 5,750,400; 5,753,441; 5,837,492; 6,033,857; 6,051,379; 6,083,698; 6,492,109; 6,951,721; and 7,250,497 (all of the patents asserted against Ambry Genetics and Gene-by-Gene as well as four additional ones indicated in bold).

The Background section of Quest's complaint focuses on Myriad's behavior, including its assertions of exclusivity in the BRCA gene diagnostics market based on its patents and its aggressive assertion of them (albeit spanning its "cease and desist" letters to the University of Pennsylvania and other academic medical centers in the late 1990's to the recent lawsuits Myriad filed against Ambry Genetics and Gene-by-Gene).  The complaint mentions (irrelevantly) that some of these centers offered nascent BRCA gene testing prior to Myriad's entry into the marketplace (and assertion of its patents), as well as the AMP v. Myriad case.  But the focus of Quest's argument is set forth succinctly in Paragraph 53 of the complaint, wherein:

Myriad's aggressive conduct has deterred other competitors from entering the BRCA1/BRCA2 genetic testing market for fear of being sued.  For example, on June 13, 2013, Pathway Genomics announced plans to offer testing for BRCA1 and BRCA2.  However, after Myriad filed suits against Ambry Genetics Corp. and Gene by Gene limited, Pathway Genomics stated that it is delaying launch of those tests.

Quest asserts that it has developed a commercial offering for BRCA gene testing, "[a]fter years of research and development, and a financial commitment of millions of dollars."  Further, [t]he types of hereditary alterations detected by Quest's BRCA Assay include alterations in DNA copy number, deletions, duplications or rearrangements in BRCA1 and BRCA" and none of its methods "make or use cloned DNA, replicative cloning vectors, expression systems or host cells comprising BRCA1 or BRCA2 DNA" or BRCA polypeptides or primers.  Despite these distinctions, Quest asserts that it is at risk of suit from Myriad, thus justifying its complaint for declaratory judgment.  In this regard the complaint has a specific allegation regarding representations from Myriad relating to the likelihood of suit.  According to Quest:

[O]nly one day after Myriad sued Ambry and the same day it sued Gene by Gene Nicolas J. Conti, PhD, Vice President Licensing and Alliances for Quest, conferred with Sam LaBrie, Vice President of Corporate Development of Myriad RBM.

62. Mr. LaBrie knew that Dr. Conti was a representative of Quest.  He knew that, unless told otherwise, his comments would be perceived by Dr. Conti and Quest as representative of the positions of Myriad.

63. Mr. LaBrie explained Myriad's business tactics and strategy.  His detailed discussion about Myriad's tactics and strategy, including marketing and pricing strategy, made it clear to Dr. Conti that Mr. LaBrie was fully aware of Myriad's positions regarding any laboratories that would offer tests for BRCA1 or BRCA2.  It was also clear to Dr. Conti that Mr. LaBrie knew Myriad's strategy for responding to any companies that offered BRCA1 and BRCA2 tests without first seeking permission from Myriad.

64. Mr. LaBrie specifically discussed with Dr. Conti the status of the Myriad patents after the Supreme Court invalidated some of those claims.  In that conversation, Mr. LaBrie indicated that the public does not understand how strong Myriad's patent claims are.  He further stated that the notion that Quest would enter the market "scared the [Myriad] team" and he confirmed that Myriad would be "sending letters" to any labs who offered BRCA1 or BRCA2 tests.  When making that statement, Mr. LaBrie knew that Quest was planning to offer some sort of BRCA testing.  Therefore, upon information and belief, he intended to advise that Quest would also receive a letter from Myriad objecting to Quest's offer of those tests.  Moreover, the above statements applied to any BRCA1 and BRCA2 testing and related services.  When making the above statements, Mr. LaBrie did not concede that any BRCA1 or BRCA2 tests would not infringe.

65. Upon information and belief, when Mr. LaBrie made the above statements directly to Dr. Conti, he knew that Dr. Conti, as a representative of Quest, would understand that Myriad would promptly assert its patents against Quest in conjunction with the launch of Quest's BRCA 1 and BRCA2 tests and related services.

These specific allegations thus support Quest's declaratory judgment action here.

The complaint contains Counts I through XXVIII alleging invalidity and non-infringement for each of the recited patents.  As in the complaint filed by Counsyl (see "Bay Area Genetic Diagnostics Company Files Declaratory Judgment Action against Myriad Genetics"), these counts are nothing more than the bare recitation of the patent numbers (the counts do not recite particular claims), and the allegations of non-infringement or invalidity for failing to meet at least one of the statutory requirements for patentability.

Quest's prayer for relief includes a declaration of invalidity or non-infringement for the recited claims of each of the recited patents, and that the case be declared exceptional and Quest be awarded attorneys fees under 35 U.S.C. § 285.

 

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