How a Chinese Company won $330M Patent Victory in Delaware Against Leading American Company

In this episode of Law, disrupted, John is joined by David Bilsker, partner at Quinn Emanuel & co-chair of the biotechnology practice, and Margaret Shyr, associate at Quinn Emanuel. David and Margaret represent a Chinese-based DNA sequencing company, BGI (Beijing Genomics Institute), which recently made headlines in China for winning the largest ever U.S. jury award for a Chinese-based company. In this episode, John discusses how BGI ultimately prevailed against the U.S.-based leader in the DNA sequencing field, Illumina—not only in achieving this record-breaking jury verdict but also invalidating Illumina patents that were the cornerstone of its decades-long dominance in the sequencing market. The episode begins with John exploring how Illumina gained its market reputation and power in DNA sequencing, which plays a huge role in fighting and understanding diseases like COVID-19. In the early 2000s, Illumina bought a British company, Solexa, whose patents and technology allowed the former to maintain its market leadership in DNA sequencing ever since. Next, David introduces the background of BGI, which started in China to contribute to the Human Genome Project, and BGI’s eventual acquisition of a Silicon Valley-based sequencing company, Complete Genomics. John asks how Chinese DNA sequencing companies cross paths with U.S. patent litigators. David gives an overview of how Illumina initiated a worldwide campaign against BGI to prevent it from introducing its DNA sequencers to the market –Illumina even won a preliminary injunction in California. With BGI being legally foreclosed from the U.S. market, they recognized that they needed the Quinn Emanuel team, led by David, to take over. John discusses with David and Margaret the challenges of litigating against Illumina in California, where Illumina was asserting patents that had survived numerous challenges by other would-be competitors, ending these earlier market entry attempts. David and Margaret describe the invalidity strategy and evidence unearthed during discovery that led to the invalidation of Illumina’s flagship patent at trial. John also notes the team’s successful mitigation of Illumina’s predictable attempts to appeal to anti-Chinese sentiments to members of the jury. Despite having no non-infringement defenses, BGI was found to owe $8 million to Illumina on the remaining four patents—a mere fraction of Illumina’s ask. Then John moves on to the Delaware case, tried only a few months later, in which David and Margaret turned the tables on Illumina and achieved the $333m verdict for Complete Genomics and BGI. They discuss the challenges of asserting CGI’s patents and defending against Illumina’s patents covering complex DNA sequencing technologies in a ten-day time-restricted trial. Margaret notes that Illumina’s main strategy against CGI’s patents was based on telling a “prior invention” story through an Illumina senior executive. David explains how the Quinn Emanuel team developed key infringement and validity evidence during fact discovery and its presentation at trial. John and David discuss David’s cross-examinations of Illumina’s lead expert, senior executive, and the mid-trial “surprise” from this executive that derailed Illumina’s case. They also explain the strategy to limit the precious trial time spent on Illumina’s asserted patents, but to inflict maximum surgical harm through cross-validation to invalidate all of Illumina’s patents. John also highlights the damages presented by another Quinn partner, David Perlson, who established to the jury that BGI should be awarded its full $333.8m claim. David describes the headline-making co Podcast Link: Law-disrupted.fm Host: John B. Quinn Producer: Alexis Hyde Music and Editing by: Alexander Rossi