U.S. Court of Appeals for the Federal Circuit, Bio-Rad Laboratories, Inc. v. International Trade Commission, Docket No. 2020-1475, 2020-1605

 

International Trade

 

ITC

 

Tariff Act of 1930 (Section 337)

 

Import

 

Patent Infringement

 

Induced Infringement

 

Contributory Infringement

 

 

 

In this consolidated appeal, Bio-Rad Laboratories, Inc. (“Bio-Rad”) and 10X Genomics, Inc. (“10X”) each challenge a portion of a decision by the United States International Trade Commission (“Commission”) regarding Bio-Rad’s allegations that 10X violated section 337 of the Tariff Act of 1930, 19 U.S.C. § 1337, by importing into the United States certain microfluidic chips. See Comm’n Opinion, In the Matter of Certain Microfluidic Devices, USITC Inv. No. 337-TA-1068, 2020 WL 225020 (Jan. 10, 2020) (“Commission Opinion”). Specifically, Bio-Rad challenges the Commission’s determination that 10X did not infringe the claims of U.S. Patent 9,500,664 (the “’664 patent”) by importing its “Chip GB.” 10X challenges the Commission’s determination that it infringes the claims of the ’664 patent as well as U.S. Patents 9,636,682 (the “’682 patent”) and 9,649,635 (the “’635 patent”) by importing its “GEM Chips.” For the reasons discussed below, we affirm the Commission’s decision with respect to both appeals.

 

We consolidated the appeals in the nature of cross-appeals. We have jurisdiction under 19 U.S.C. § 1337(c) and 28 U.S.C. § 1295(a)(6).

 

Both parties’ appeals relate to patent infringement, which is a two-step analysis. Packet Intelligence LLC v. NetScout Sys., 965 F.3d 1299, 1306 (Fed. Cir. 2020) (citing Clare v. Chrysler Grp. LLC, 819 F.3d 1323, 1326 (Fed. Cir. 2016)). The first step of the infringement analysis is claim construction, id., which is an issue of law that we review de novo. Linear Tech. Corp. v. ITC, 566 F.3d 1049, 1054 (Fed. Cir. 2009). The second step of the infringement analysis involves a comparison of the accused product to the construed claims, which is an issue of fact that we review for substantial evidence. See Packet Intelligence, 965 F.3d at 1305–06.

 

The compelling factor here is the distinction between “samples” and “reagents.” The ’664 patent consistently makes clear that a sample is not a reagent, beginning with the opening sentences of the introduction section. See ’664 patent col. 1 ll. 26–31 (“Many biomedical applications rely on high-throughput assays of samples combined with reagents. For example, in research and clinical applications, high-throughput genetic tests using target-specific reagents can provide high-quality information about samples . . . .” (emphases added)). The patent goes on to list definitions that lead to the unavoidable conclusion that a compound cannot simultaneously be a sample and a reagent. For example, within the definition of “sample,” the patent states that “a sample is the general subject of interest for a test that analyzes an aspect of the sample, such as an aspect related to at least one analyte that may be present in the sample.” Id. at col. 8 ll. 37–40. Similarly, the term “analyte” is defined as “a component(s) or potential component(s) of a sample that is analyzed in a test.” Id. at col. 9 ll. 1–2. And the term “test” is defined as “a procedure(s) and/or reaction(s) used to characterize a sample, and any signal(s), value(s), data, and/or result(s) obtained from the procedure(s) and/or reaction(s).” Id. at col. 8 ll. 7–9. Thus, the patent describes a relationship between a sample, the analyte(s) it contains, and the test(s) performed to analyze it.

 

In contrast, the patent defines a “reagent” as “a compound, set of compounds, and/or composition that is combined with a sample in order to perform a particular test(s) on the sample.” Id. at col. 9 ll. 19–21 (emphasis added). Thus, a reagent is not a part of a sample, nor is it the same thing as a sample in the context of the patent. The ALJ’s findings reflect a correct determination that, while the term “sample” is defined broadly in the patent, the definition of “sample” is not so broad as to include reagents within its scope.

 

Because we find no error in the claim construction, what remains is the second step of the infringement analysis, which turns on whether the monomer solution in the Chip GB is properly characterized as a sample or as a reagent. We review that fact question for substantial evidence. See Packet Intelligence, 965 F.3d at 1305–06.

 

The Commission adopted the reasoning of the ALJ, which relied on testimony from multiple witnesses that the monomer is a reagent and not a sample. Those witnesses focused on the fact that 10X does not analyze the monomers, but rather uses them to make the gel beads that go into reagent kits. See J.A. 179 (citing testimony from multiple fact and expert witnesses). We also agree with 10X that quality control testing is not the type of testing described in the patent, and it does not change the nature of the monomer. We therefore conclude that substantial evidence supports the ALJ’s finding that the monomer in the Chip GB is not a sample. Accordingly, Bio-Rad has failed to persuade us to overturn the Commission’s finding that the Chip GB does not infringe claims 1 and 14 of the ’664 patent.

 

We finally consider the Commission’s determination that Bio-Rad proved the elements of induced and contributory infringement of the ’682 and ’635 patents with respect to the GEM Chips. Induced infringement under 35 U.S.C. § 271(b) requires proof of underlying direct infringement, as well as proof that (1) “the defendant knew of the patent,” (2) the defendant knew or should have known that “the induced acts constitute patent infringement,” and (3) the defendant “possessed specific intent to encourage another’s infringement.” Sanofi, LLC v. Watson Labs. Inc., 875 F.3d 643, 643–44 (Fed. Cir. 2017). Contributory infringement under 35 U.S.C. § 271(c) requires proof that (1) the defendant had “knowledge of the patent in suit,” (2) the defendant had “knowledge of patent infringement,” and (3) the accused product is not a staple article or commodity of commerce suitable for a substantial noninfringing use. Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct. 1920, 1926 (2015). Because inducement and contributory infringement are issues of fact, see, e.g., Barry v. Medtronic, Inc., 914 F.3d 1310, 1334 (Fed. Cir. 2019), we review the Commission’s decisions for substantial evidence. Guangdong, 936 F.3d at 1358–59.

 

(…) At the very least, the ALJ found that 10X was willfully blind to the fact that its technology would infringe Bio-Rad’s patents, and continued to import infringing GEM Chips and engage in infringing activities even after Bio-Rad filed its complaint. ALJ Initial Determination, 2018 WL 5279172, at *75–76.

 

CONCLUSION

We have considered the parties’ remaining arguments but we find them unpersuasive. Accordingly, the decision of the Commission is affirmed.

 

 

 

(U.S. Court of Appeals for the Federal Circuit, May 28, 2021, Bio-Rad Laboratories, Inc. v. International Trade Commission, Docket No. 2020-1475, 2020-1605, Circuit Judge Lourie)