Federal Government Invokes False Claims Act to Recover Patent Royalties

Promega, acting as a private attorney general on behalf of Federal government has invoked the False Claims Act ("whistleblower statute") to recover patent royalties paid on a patent declared unenforceable through inequitable conduct.

From a press release from Promega on August 24, 2004:

Fourth Circuit Court of Appeals will decide the right of the United States to recover losses on payments made to Hoffmann-La Roche and its partner Applera Corporation on a key patent in molecular biology. A preliminary communication from the U.S. District Court in Virginia indicates that the case will be dismissed and today Promega announced it will appeal that determination. This allows the appellate court to resolve the issue of whether lies told to the U.S. Government in procuring the patent on Taq DNA Polymerase can be addressed under the False Claims Act.

The claim filed in Virginia seeks recovery of what could be hundreds of millions of dollars in wrongful payments for Taq DNA Polymerase by the Government to Hoffmann-La Roche and Applera. This action arose out of other litigation in which the Roche Taq patent was ruled unenforceable. The Federal Court for the Northern District of California ruled in 1999 and reaffirmed this past May that the patent for Taq could not be enforced against anyone because it had been obtained with a series of false material statements that were intentionally made to the United States Patent Office, which even included the fabrication of experimental data. Promega damage claims on its own behalf remain pending in California.