Ancestry.com Pays $12.5M in Patent Dispute Settlement

Ancestry.com, a genealogy website, and its contract manufacturer Spectrum Solutions, have agreed to pay $12.5 million to OraSure Technologies Inc., and its Canadian subsidiary DNA Genotek, Inc., for infringement of two patents that involve DNA testing technology procedures (U.S. Patent Nos. 8,221,381 B2 and 9,207,164 B2).

Genotek offers biological sample collection products, specifically kits for collecting DNA samples. From 2012 to 2013, Ancestry.com purchased Genotek’s DNA saliva test kits so their customers could use the technology to enhance their genealogical mapping with the ability to trace their ethnic background. In 2013, Ancestry filed a patent application (WO 2015017701 A1) for an improved version of Genotek’s DNA saliva test kit without the permission of Genotek.

In May of 2015 Genotek sued Ancestry and alleged they stole the technology for its own use which violated the terms of the use agreement between the two companies. Ancestry argued that the infringement case should be dismissed because Genotek failed to sufficiently prove patent infringement. The court agreed there was a lack of sufficient evidence until it was pointed out that the DNA kits purchased by Ancestry were labeled as patent-protected and Dr. Chahine, patent attorney and general manager for Ancestry, approved the labels. It was also noted that Dr. Chahine was the first-named inventor on the patent application Ancestry filed.

According to the statement released by OraSure, “[u]nder a Settlement and License Agreement executed by the parties, Ancestry has agreed to pay DNA Genotek a settlement fee of $12.5 million. In addition, DNA Genotek has granted Ancestry a royalty-bearing, non-exclusive, worldwide license to certain patents and patent applications related to the collection of DNA in human saliva. The license granted to Ancestry is limited to saliva DNA collection kits sold or used as part of Ancestry’s genetic testing service offerings and does not cover the sale or use of product outside of Ancestry’s business. The Settlement and License Agreement also provides DNA Genotek with a royalty-free, non-exclusive license to patents related to Ancestry’s existing saliva DNA collection kit and certain modifications thereto.”

The statement went on further to say, “[t]he parties have each agreed to a mutual release of claims and other provisions typical for settlement agreements of this type. The Agreement provides for the dismissal of pending federal lawsuits in the District of Delaware and the Southern District of California and for the parties to jointly seek termination of Inter Partes Review proceedings before the U.S. Patent and Trademark Office involving the DNA Genotek patents asserted in the litigation.”

Douglas A. Michels, President and CEO of OraSure, commented on the settlement and stated, “[w]e are pleased to have resolved this litigation. We are committed to innovation and the creation of new products and solutions for customers in the markets that we serve. An important part of this commitment is the protection of our technology and products and we will remain vigilant in seeking to enforce our intellectual property rights where needed.”

Brandon Borrman, spokesman for Ancestry, also stated, “[w]e are pleased to have this matter resolved and remain focused on delivering our millions of customers the best possible product and experience.”

Suiter Swantz IP is a full-service intellectual property law firm serving all of Nebraska, Iowa and South Dakota. If you have any intellectual property questions or need assistance with any patent, trademark or copyright matters and would like to speak to one of our patent attorneys please feel free to contact us.

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