Joshua Rosenkranz. Credit: David Handschuh/ALM

Orrick, Herrington & Sutcliffe partner E. Joshua Rosenkranz is known as "the defibrillator" for his ability to revive cases from the dead on appeal. But his latest patient may be beyond saving, based on arguments Friday before the U.S. Court of Appeals for the Federal Circuit.

Two of the three judges hearing Bio-Rad Laboratories v. 10x Genomics sounded skeptical of Rosenkranz's arguments that 10x Genomics Inc.'s ground-breaking single-cell technology doesn't infringe three Bio-Rad Laboratories Inc. patents, or that a Delaware jury's award of $24 million and a 15% royalty were beyond the pale.

But it did sound as if Rosenkranz may persuade the court to dissolve an injunction that he said threatens "vitally important" scientific research, including research into COVID-19. "These instruments needed to get an exemption from the injunction to do critically important COVID research," Rosenkranz told the panel.

10x, which is about six years old and just went public last summer, claims to have pioneered a revolution in life sciences research. Scientists around the world use its tech to study cancer cells, blood cells and the genetic underpinnings of inherited and infectious diseases. It characterizes Hercules, California-based Bio-Rad as a failed competitor that bought patents from the University of Chicago and somehow persuaded jurors to award 15%, which Rosenkranz said was 15 times the amount Chicago had actually negotiated for the patents before Bio-Rad came along.

Jurors found that the Chicago patents claimed the equivalent of 10x's technology. On Friday, Rosenkranz argued that the Chicago patents specifically claim a non-fluorinated channel in a microfluidic chip, whereas 10x redesigned its products to use a fluorine compound called Kynar. "Simply put, an opposite cannot be an equivalent," Rosenkranz told the court.

But Judge Kathleen O'Malley stopped him short, pointing out that the doctrine of equivalents case law makes an exception for "tangential" differences. "I don't see any real dispute in the record as to whether the addition of the Kynar had any technological benefit or purpose," O'Malley said.

"There was a dispute in the record, but I would grant you that the jury was entitled to conclude that the two function the same," Rosenkranz said.

"Your own witnesses said they knew of absolutely no benefit to adding it, right?" O'Malley pressed.

"Certainly the jury could have found that," Rosenkranz conceded. "But our own witnesses said that the Kynar chelates better."

"But if the jury could have found it, doesn't that really answer the question?" Judge Pauline Newman asked.

Rosenkranz pivoted to damages. "Bio-Rad's expert cherry-picked the licenses with the three highest outlier rates in the record" and didn't apportion the rates to account for 10x's sizable contributions to its technology, he said.

"I didn't see any discussion of Daubert or admissibility issues," O'Malley said.

Rosenkranz insisted that 10x has raised a proper Daubert challenge on appeal—and he got support from the third member of the panel, Judge Richard Taranto, on that point. But he seemed to put off Newman when he said the Chicago patents "had nothing to do with this enormously valuable single-cell invention."

"I think that there was some question as to whether it was completely different," said Newman, who is a chemist by training. "Let's not overstate."

Weil, Gotshal & Manges partner Edward Reines argued for Bio-Rad that 10x waited until after claim construction in the case to create its Kynar redesign, for the sole reason of getting around the doctrine of equivalents argument. "It was created in law offices, not in a laboratory," he said. "And it was designed precisely for what they called, quote-unquote, 'intellectual property reasons.'"

"So the real question is, is it a brilliant attempt to get around it?" O'Malley asked.

Reines laughed and said, "Well put, your honor," though it wasn't completely clear if O'Malley was joking.

Taranto sounded skeptical about damages, asking Reines about expert testimony describing the massive work that needed to be done from the time of the patents in the early 2000s to creating a worthwhile marketable product. "Why doesn't that point rather strongly in the direction of the percentage being rather lower than it is?" he asked.

Reines argued that 10x's 85% of the license covers that work, but that in any event, a droplet product is not like a cellphone with hundreds of features to apportion for. "We shouldn't let the cellphone cases defeat a half-billion investment in this case," Reines said.

All three of the judges sounded skittish about maintaining the injunction Bio-Rad won in district court, even though 10x has since designed around parts of it.

Newman cited "the importance of the product, the importance to the community and to the advancement of science."

"Where is the competition exactly at this point?" O'Malley asked.

Rosenkranz argued that not only does Bio-Rad not offer a competing product, "there is no other instrument developed by anyone else that does those things."