DCT

3:22-cv-00676

Fate Therap Inc v. Shoreline Biosciences Inc

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: Fate Therapeutics, Inc. v. Shoreline Biosciences, Inc., 3:22-cv-00676, S.D. Cal., 02/14/2023
  • Venue Allegations: Venue is alleged to be proper in the Southern District of California as Defendants reside in and/or maintain a regular and established place of business within the district.
  • Core Dispute: Plaintiffs allege that Defendants' development and use of induced pluripotent stem cells ("iPSCs") for immunotherapies infringes seven patents related to foundational methods and compositions for reprogramming somatic cells.
  • Technical Context: The technology concerns the generation of iPSCs, which are adult cells genetically reprogrammed to an embryonic stem cell-like state, enabling the development of patient-specific or "off-the-shelf" cell therapies.
  • Key Procedural History: The complaint alleges a complex background wherein Defendant Dr. Kaufman, while serving as a paid Scientific Advisor to Plaintiff Fate Therapeutics, co-founded Defendant Shoreline Biosciences as a direct competitor and used proprietary information, including knowledge of the asserted patents, to advance Shoreline's business.

Case Timeline

Date Event
2003-11-26 Earliest Priority Date for all Asserted Patents
2011-12-06 U.S. Patent 8,071,369 Issues
2015-01-13 U.S. Patent 8,932,856 Issues
2015-01-27 U.S. Patent 8,940,536 Issues
2015-02-10 U.S. Patent 8,951,797 Issues
2015-07-01 Dr. Kaufman's Scientific Advisor Agreement with Fate Therapeutics begins
2015-10-27 U.S. Patent 9,169,490 Issues
2018-07-10 U.S. Patent 10,017,744 Issues
2019-10-29 U.S. Patent 10,457,917 Issues
2020-05-14 Alleged co-founding date of Shoreline Biosciences
2023-02-14 Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 8,071,369 - “Compositions for Reprogramming Somatic Cells”

The Invention Explained

  • Problem Addressed: The patent’s background section describes the need for alternative methods of generating pluripotent stem cells that do not rely on controversial sources such as embryos or fetal tissue (’369 Patent, col. 1:45-53). Existing methods were either ethically contentious or involved complex techniques like nuclear transfer, limiting research and therapeutic application ('369 Patent, col. 1:54-67).
  • The Patented Solution: The invention provides a composition for reprogramming a somatic cell (a standard, differentiated body cell) into a pluripotent state. This is achieved by introducing an external piece of genetic material ("an exogenously introduced nucleic acid") that codes for the Oct4 protein, a key transcription factor involved in maintaining pluripotency, into the somatic cell ('369 Patent, Abstract; col. 3:5-16). This direct reprogramming method creates patient-specific, pluripotent cells without using embryos.
  • Technical Importance: This technology provided a foundational component for generating induced pluripotent stem cells (iPSCs), a breakthrough that allows for the creation of patient-specific cell lines for research, drug screening, and therapeutic development (Compl. ¶ 2).

Key Claims at a Glance

  • The complaint asserts at least independent claim 1 (Compl. ¶ 159).
  • Claim 1 of the ’369 Patent includes the following essential elements:
    • A composition comprising an isolated primary somatic cell
    • that comprises an exogenously introduced nucleic acid encoding an Oct4 protein
    • operably linked to at least one regulatory sequence.

U.S. Patent No. 8,932,856 - “Methods for Reprogramming Somatic Cells”

The Invention Explained

  • Problem Addressed: The ’856 Patent shares a common specification with the ’369 Patent and addresses the same technical problem of creating pluripotent cells from non-controversial sources ('856 Patent, col. 1:45-53; Compl. ¶ 132).
  • The Patented Solution: Rather than claiming the cell itself, this patent claims a method for making a somatic cell more susceptible to being reprogrammed. The method comprises introducing a nucleic acid that encodes the Oct4 protein into the cell, which in turn increases the cell's internal expression of Oct4 protein ('856 Patent, Abstract). This increased expression is described as the mechanism that renders the cell more amenable to becoming pluripotent, as illustrated by experiments showing increased blastocyst formation after Oct4 induction ('856 Patent, Table 1).
  • Technical Importance: This patent protects the core process of initiating cellular reprogramming by overexpressing a key transcription factor, a crucial upstream step in the creation of nearly all iPSCs (Compl. ¶¶ 2, 33).

Key Claims at a Glance

  • The complaint asserts at least independent claim 1 (Compl. ¶ 192).
  • Claim 1 of the ’856 Patent includes the following essential elements:
    • A method of making a somatic cell more susceptible to reprogramming to a pluripotent state comprising
    • introducing at least one exogenous nucleic acid encoding Oct4 operably linked to at least one regulatory sequence into the cell,
    • thereby increasing expression of Oct4 protein in the somatic cell,
    • wherein increased expression of Oct4 protein makes the cell more susceptible to reprogramming to a pluripotent state.

U.S. Patent No. 8,951,797 - “Compositions for Identifying Reprogramming Factors”

  • Technology Synopsis: This patent claims a composition comprising a primary somatic cell into which a nucleic acid encoding Oct4 has been exogenously introduced, where the introduction results in increased expression of Oct4 in the cell.
  • Asserted Claims: Independent claim 1 (Compl. ¶ 232).
  • Accused Features: The iPSCs allegedly used by Defendants, which were reprogrammed from somatic cells in a process that involved introducing a nucleic acid encoding Oct4 and increasing its expression (Compl. ¶¶ 238, 240).

U.S. Patent No. 8,940,536 - “Methods for Making Somatic Cells More Susceptible to Reprogramming”

  • Technology Synopsis: This patent claims a method of making a primary somatic cell more susceptible to reprogramming by introducing an exogenous nucleic acid encoding Oct4, wherein its expression makes the cell more susceptible to reprogramming.
  • Asserted Claims: Independent claim 1 (Compl. ¶ 264).
  • Accused Features: The processes used to create the iPSCs that Defendants ultimately use for their immunotherapy platform (Compl. ¶¶ 270, 272).

U.S. Patent No. 9,169,490 - “Methods for Reprogramming Somatic Cells”

  • Technology Synopsis: This patent claims a somatic cell containing an exogenous nucleic acid encoding Oct4, where the resulting Oct4 expression is comparable to that found in an embryonic stem cell.
  • Asserted Claims: Independent claim 1 (Compl. ¶ 304).
  • Accused Features: The iPSCs allegedly used by Defendants, which are alleged to have Oct4 expression levels comparable to embryonic stem cells as a result of the reprogramming process (Compl. ¶ 312).

U.S. Patent No. 10,457,917 - “Methods for Reprogramming Somatic Cells”

  • Technology Synopsis: This method patent adds a specific limitation to the reprogramming process, requiring that the exogenous nucleic acid encoding Oct4 is transiently transfected into the somatic cell.
  • Asserted Claims: Independent claim 1 (Compl. ¶ 337).
  • Accused Features: The process for making the accused iPSCs, which the complaint alleges uses non-integrating episomal plasmids, a form of transient transfection (Compl. ¶¶ 57, 346).

U.S. Patent No. 10,017,744 - “Methods for Reprogramming Somatic Cells”

  • Technology Synopsis: This method patent requires obtaining a somatic cell that comprises exogenously introduced polynucleic acids encoding both Oct4 and at least one of Sox2 or Nanog.
  • Asserted Claims: Independent claim 1 (Compl. ¶ 377).
  • Accused Features: The process for making the accused iPSCs, which allegedly involves the use of plasmids encoding Oct4, Sox2, and other factors (Compl. ¶¶ 57, 383, 385).

III. The Accused Instrumentality

Product Identification

The complaint accuses Defendants' "iPSC-derived cell therapy manufacturing platform" and the associated use, development, and manufacture of immunotherapy products, such as NK-cell and macrophage cell products (Compl. ¶¶ 68, 118, 162). The direct instrumentalities are the iPSC lines that Shoreline obtained, which were allegedly manufactured by Lonza Walkersville, Inc. ("Lonza iPSCs") (Compl. ¶¶ 54, 141).

Functionality and Market Context

The complaint alleges that Shoreline purchased GMP-grade iPSC lines that were created by Lonza through a process of reprogramming human umbilical cord blood cells (Compl. ¶¶ 54, 55). This process allegedly involved introducing non-integrating episomal plasmids containing genes for reprogramming factors, including the critical Oct4 gene, into the somatic cells (Compl. ¶¶ 57, 59). Shoreline is accused of then using these iPSCs as a renewable source to expand, bank, and differentiate into "off-the-shelf" therapeutic cells (Compl. ¶¶ 68-72, 119). Shoreline’s website promotes this capability, featuring a diagram of its "iPSC-Derived Cell Therapy Manufacturing Platform" which depicts genetic manipulation of an iPSC master clone to generate immune cells (Compl. ¶ 162). The complaint asserts this platform enabled Shoreline to secure strategic partnerships valued at over $4 billion (Compl. ¶ 8).

IV. Analysis of Infringement Allegations

'369 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
A composition comprising an isolated primary somatic cell The accused iPSCs originate from primary somatic cells, specifically human umbilical cord blood (hUCB CD34+) cells. ¶166 col. 6:4-10
that comprises an exogenously introduced nucleic acid encoding an Oct4 protein The process used to create the iPSCs involved introducing a non-integrating plasmid (pEB-C5) that contains the gene encoding the Oct4 protein. ¶167 col. 2:50-57
operably linked to at least one regulatory sequence. The Oct4 gene in the pEB-C5 plasmid is controlled by a CAG promoter, which is a regulatory sequence. ¶165 col. 9:1-6

'856 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
A method of making a somatic cell more susceptible to reprogramming ... comprising introducing at least one exogenous nucleic acid encoding Oct4 operably linked to at least one regulatory sequence into the cell, The process for making the accused iPSCs introduces a plasmid containing the Oct4 gene, linked to a promoter, into somatic cells (umbilical cord blood cells). ¶201 col. 9:1-6
thereby increasing expression of Oct4 protein in the somatic cell, The introduction of the plasmid is alleged to increase the expression of Oct4 protein within the cell, which is described as a necessary step for reprogramming. ¶198 col. 3:13-25
wherein increased expression of Oct4 protein makes the cell more susceptible to reprogramming to a pluripotent state. This increased expression of Oct4 is alleged to be the mechanism that makes the cell susceptible to being reprogrammed into an iPSC. ¶198 col. 2:26-34
  • Identified Points of Contention:
    • Scope Questions: A potential issue may be whether the starting material used by Lonza—umbilical cord blood cells—qualifies as a "primary somatic cell" under a proper construction of that term, as defendants might argue such cells have progenitor-like qualities distinct from terminally differentiated somatic cells like fibroblasts.
    • Technical Questions: A key evidentiary question for the method claims ('856 Patent) will be proving the specific steps of the manufacturing process performed by the non-party, Lonza. The complaint relies on published literature to describe the Lonza process (Compl. ¶¶ 56-62), but discovery will be required to confirm that the specific iPSC lines used by Shoreline were in fact created by a method that meets every claim limitation, such as "increasing expression of Oct4 protein." A graphic from a Shoreline presentation shows a process of turning "Adult somatic cells" into "Induced pluripotent stem cells" (Compl. ¶ 197). This visual may support the allegation that Shoreline's overall platform relies on such a reprogramming method.

V. Key Claim Terms for Construction

  • The Term: "primary somatic cell" (’369 Patent, Claim 1)
  • Context and Importance: This term defines the starting material for the claimed composition. The infringement case hinges on whether the human umbilical cord blood cells allegedly used by Lonza to create the iPSCs fall within this definition. Practitioners may focus on this term because the properties of neonatal cord blood cells could be distinguished from more differentiated adult somatic cells like fibroblasts.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The patent specification provides a non-exhaustive list of "somatic cells" that includes "hematopoietic cells," "mononuclear cells," and "adult stem cells," categories that may be argued to encompass umbilical cord blood cells ('369 Patent, col. 6:4-10).
    • Evidence for a Narrower Interpretation: The term "primary" is defined in the specification as "non-immortalized" ('369 Patent, col. 6:5-7). A defendant might argue that the context of the invention, which focuses on reversing terminal differentiation, implies the term is directed at cells from mature tissues, not neonatal sources with inherent plasticity.
  • The Term: "more susceptible to reprogramming" (’856 Patent, Claim 1)
  • Context and Importance: This functional language defines the result of the claimed method. The dispute will likely center on what objective evidence is required to prove that the introduction of exogenous Oct4 actually rendered the cells "more susceptible."
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: A plaintiff may argue that successfully creating a reprogrammed cell line after performing the claimed step is itself sufficient evidence of increased susceptibility. The specification's experimental data shows that inducing Oct4 expression led to more efficient derivation of ES-like cells from cloned embryos, linking the claimed cause with the desired effect ('856 Patent, Table 1).
    • Evidence for a Narrower Interpretation: A defendant may argue that the term requires a direct, quantitative comparison demonstrating a higher rate of successful reprogramming versus a control group. The patent's own data in Table 1, which compares results with and without doxycycline induction, could be used to argue that such a comparative and quantifiable increase in efficiency is what the inventors contemplated as the meaning of "more susceptible."

VI. Other Allegations

  • Indirect Infringement: The complaint alleges that Defendants induced infringement by instructing and supervising third parties, such as the Advanced Cell Therapy Laboratory (ACTL) at UC San Diego, to produce iPSCs using the patented methods (Compl. ¶¶ 174-175, 209). Additionally, the complaint alleges infringement under 35 U.S.C. § 271(g) by importing and using iPSCs in the U.S. that were made abroad by a process patented in the U.S. (Compl. ¶¶ 211, 214).
  • Willful Infringement: The willfulness allegations are based primarily on alleged pre-suit knowledge. The complaint asserts that Defendant Dr. Kaufman was aware of the Asserted Patents and their value due to his role as a Scientific Advisor for Plaintiff Fate Therapeutics, a position he allegedly held at the time he co-founded Shoreline (Compl. ¶¶ 36, 171, 173). This alleged knowledge, dating back to at least May 14, 2020, is presented as the basis for Defendants' purported deliberate and willful infringement (Compl. ¶¶ 182-183).

VII. Analyst’s Conclusion: Key Questions for the Case

  • A core issue will be one of process attribution: can Plaintiffs definitively prove, through discovery, that the specific iPSC lines Shoreline acquired from a third-party repository were manufactured by non-party Lonza using a process that meets every limitation of the asserted method claims? The complaint's reliance on published literature and marketing materials, such as a diagram illustrating the Lonza iPSC manufacturing process, will need to be substantiated with direct evidence of the actual process used for the specific cell lines in question (Compl. ¶ 56).
  • A second key issue will turn on scienter and intent: what was the exact scope of Dr. Kaufman’s knowledge of the Asserted Patents from his prior relationship with Fate, and can Plaintiffs demonstrate that this knowledge is legally imputable to Shoreline to support the claims for induced and willful infringement?
  • Finally, the case may involve a question of definitional scope: can the term "primary somatic cell," central to the composition claims, be construed to cover neonatal umbilical cord blood cells, or will the court interpret the term as being limited to cells sourced from mature, terminally differentiated adult tissues?