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Roche hit with new breed of patent suit

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Roche Diagnostics Corp. has been hit with a new kind of patent lawsuit that attorneys are calling “the latest menace to business.”

Roche Diagnostics, a Swiss company that keeps its U.S. headquarters in Indianapolis, has been sued for marking its Accu-Chek blood glucose monitors and accessories with patents that are expired. Illinois resident David O’Neill has sued on behalf of the U.S. government to recover damages of $500 per infraction.

Since Roche sells millions of monitors and test strips—a kit of both ranges from about $15 to $30 a pop—a penalty of $500 each could be huge. If O'Neill recovers any damages from Roche, he would split them with the federal government.

Roche’s total U.S. revenue from diabetes monitors was about $670 million last year, according to San Francisco-based Close Concerns, a diabetes market research firm based in San Francisco.

“Roche is a sophisticated company and has many decades of experience applying for, obtaining and litigating patents," O’Neill’s attorneys allege in the lawsuit, adding, "Roche knows, or reasonably should know, of the requirements of [the law.]”

O’Neill’s lawsuit against Roche is one of several “qui tam” lawsuits he has filed this year against companies for marking their products with expired patents. In fact, 50 similar lawsuits were filed against companies during the first three months of the year, according to a National Law Review article written by attorneys at Chicago-based law firm Vedder Price P.C.

These suits began after a federal circuit court decision on Dec. 29, which said improper patent marking on products could be punished not as one continuous act, for a maximum penalty of $500, but for each instance, with every instance carrying a maximum fine of $500.

“This is the perfect storm for the marking trolls [such as David O’Neill],” wrote the Vedder Price attorneys, “since their end game is a quick, large settlement, not protracted litigation. Either way, the patent owner could be on the hook for a considerable sum.”

O’Neill’s case against Roche Diagnostics was filed in Feburary in federal court in Illinois, but in late July was moved, at Roche’s request, to federal court in Indianapolis.

Calls to O’Neill’s attorneys, who are based in Chicago, were not returned.

Roche Diagnostics spokesman Mike Weist said the company regards the lawsuit as “without merit.”
 

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  1. to mention the rest of Molly's experience- she served as Communications Director for the Indianapolis Department of Public Works and also did communications for the state. She's incredibly qualified for this role and has a real love for Indianapolis and Indiana. Best of luck to her!

  2. Shall we not demand the same scrutiny for law schools, med schools, heaven forbid, business schools, etc.? How many law school grads are servers? How many business start ups fail and how many business grads get low paying jobs because there are so few high paying positions available? Why does our legislature continue to demean public schools and give taxpayer dollars to charters and private schools, ($171 million last year), rather than investing in our community schools? We are on a course of disaster regarding our public school attitudes unless we change our thinking in a short time.

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  4. The Indiana toll road used to have some of the cleanest bathrooms you could find on the road. After the lease they went downhill quickly. While not the grossest you'll see, they hover a bit below average. Am not sure if this is indicative of the entire deal or merely a portion of it. But the goals of anyone taking over the lease will always be at odds. The fewer repairs they make, the more money they earn since they have a virtual monopoly on travel from Cleveland to Chicago. So they only comply to satisfy the rules. It's hard to hand public works over to private enterprise. The incentives are misaligned. In true competition, you'd have multiple roads, each build by different companies motivated to make theirs more attractive. Working to attract customers is very different than working to maximize profit on people who have no choice but to choose your road. Of course, we all know two roads would be even more ridiculous.

  5. The State is in a perfect position. The consortium overpaid for leasing the toll road. Good for the State. The money they paid is being used across the State to upgrade roads and bridges and employ people at at time most of the country is scrambling to fund basic repairs. Good for the State. Indiana taxpayers are no longer subsidizing the toll roads to the tune of millions a year as we had for the last 20 years because the legislature did not have the guts to raise tolls. Good for the State. If the consortium fails, they either find another operator, acceptable to the State, to buy them out or the road gets turned back over to the State and we keep the Billions. Good for the State. Pat Bauer is no longer the Majority or Minority Leader of the House. Good for the State. Anyway you look at this, the State received billions of dollars for an assett the taxpayers were subsidizing, the State does not have to pay to maintain the road for 70 years. I am having trouble seeing the downside.

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