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Stratagene Responds to Damages Awarded in Invitrogen Lawsuit.


Stratagene Intends to Appeal the Decision

Competent Cells Patent At Issue

LA JOLLA La Jolla (lə hoi`yə), on the Pacific Ocean, S Calif., an uninc. district within the confines of San Diego; founded 1869. The beautiful ocean beaches, in particular La Jolla shores and Black's Beach, and sea-washed caves attract visitors and , Calif. -- Stratagene Corporation (NASDAQ NASDAQ
 in full National Association of Securities Dealers Automated Quotations

U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on
:STGN), a developer, manufacturer and marketer of specialized life science research and diagnostic products, announced today that the federal judge overseeing Invitrogen Corporation vs. Stratagene in the United States District Court for the Western District of Texas The United States District Court For the Western District Of Texas (W.D.Tex) is the Federal district court whose jurisdiction consists of the counties in the western part of the state of Texas. This district covers over 92,000 square miles and seven divisions.  has awarded Invitrogen $16.2 million in damages plus pre-judgment interest and ruled that Stratagene must pay Invitrogen's attorney's fees, in an amount to be determined by the court. On July 25, 2006, the jury determined that Invitrogen's 4,981,797 patent is valid and that Stratagene infringed that patent by making and selling its competent E. coli E. coli: see Escherichia coli.
E. coli
 in full Escherichia coli

Species of bacterium that inhabits the stomach and intestines. E. coli can be transmitted by water, milk, food, or flies and other insects.
 cell products. The jury decided to award Invitrogen a 15% royalty rate on sales between the years 1997 and 2004 (for a total of $7.9 million in damages) and found Stratagene to have willfully willfully adv. referring to doing something intentionally, purposefully and stubbornly. Examples: "He drove the car willfully into the crowd on the sidewalk." "She willfully left the dangerous substances on the property." (See: willful)  infringed the patent only between the years 1997 and 2001.

Stratagene believes that the jury's verdict and the damages awarded were not supported by the facts of the case or the law and as a result, the Company intends to appeal the decision. In appealing the jury's verdict and the court's subsequent post trial rulings, Stratagene will be challenging the finding of validity of the patent, the appropriateness of the damages determined by the jury, the trebling of a portion of the amount by the court and the award of attorney's fees.

Stratagene had previously modified its process for manufacturing competent E. coli cell products and, as a result, Invitrogen has agreed that Stratagene products sold in recent years and currently offered for sale will not be affected by the jury verdict. The jury found that Invitrogen was not entitled to lost profits because Stratagene has had a non-infringing manufacturing process for competent cells.

The action by Invitrogen was initiated in March 2001. In November 2001, the district court granted Stratagene's motion for summary judgment motion for summary judgment n. a written request for a judgment in the moving party's favor before a lawsuit goes to trial and based on recorded (testimony outside court) affidavits (or declarations under penalty of perjury), depositions, admissions of fact, answers  finding that Invitrogen's aforementioned patent was not infringed by Stratagene. Upon Invitrogen's appeal, the United States Federal Circuit Court of Appeals reversed the lower court's decision in part and remanded the case back to the lower court. In January 2004, the district court granted partial summary judgment to Invitrogen based on the determination that Stratagene's then-existing manufacturing process infringed Invitrogen's patent, however the court also determined that Invitrogen's patent was invalid. Stratagene then changed its manufacturing process for competent cell products to a non-infringing method. Invitrogen appealed the decision again and in October 2005 the Federal Circuit Court reversed the district court's findings in part. The case was remanded back to district court, resulting in the jury's determination handed down on July 25, 2006 followed by the court order issued on October 31, 2006.

The Company currently has approximately $16.6 million in unrestricted cash and a $9.0 million revolving line of credit Revolving line of credit

A bank line of credit on which the customer pays a commitment fee and can take and repay funds at will. Normally a revolving LOC involves a firm commitment from the bank for a period of several years.
 in place which has a zero balance currently outstanding. The Company's operations remain cash flow positive. The total amount of long-term debt Long-Term Debt

Loans and financial obligations lasting over one year.

Notes:
For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt.
 is approximately $3.8 million and final payments on such long-term debt are not due until 2022.

About Stratagene Corporation

Stratagene is a developer, manufacturer and marketer of specialized life science research and diagnostic products. The Company's life science research unit supports advances in science by inventing, manufacturing and distributing products that simplify, accelerate and improve research. These products are used throughout the academic, industrial and government research sectors in fields spanning molecular biology molecular biology, scientific study of the molecular basis of life processes, including cellular respiration, excretion, and reproduction. The term molecular biology was coined in 1938 by Warren Weaver, then director of the natural sciences program at the Rockefeller , genomics, proteomics, drug discovery and toxicology. The Company's diagnostic unit develops and manufactures products for urinalysis, and high quality automated instrument and reagent systems that use blood samples to test for more than 1,000 different allergies and autoimmune disorders Autoimmune Disorders Definition

Autoimmune disorders are conditions in which a person's immune system attacks the body's own cells, causing tissue destruction.
. In addition, by combining its expertise in diagnostics and molecular biology, as well as its experience with FDA FDA
abbr.
Food and Drug Administration


FDA,
n.pr See Food and Drug Administration.

FDA,
n.pr the abbreviation for the Food and Drug Administration.
 regulatory procedures, the Company is pursuing opportunities to expand its product portfolio to include molecular diagnostic kits and instrumentation. More information is available at www.stratagene.com.

Safe Harbor Safe Harbor

1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated.

2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive.
 Statement

Certain statements in this news release that are not historical fact constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and  of 1995. Stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements. Stratagene generally identifies forward-looking statements by using words like "believe," "intend," "target," "expect," "estimate," "may," "should," "plan," "project," "contemplate," "anticipate," "predict" or similar expressions. You can also identify forward-looking statements by discussions of strategies, plans or intentions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results of Stratagene to be materially different from historical results or from any results expressed or implied by such forward-looking statements. Among the important factors that could cause actual results to differ materially from those contained in or implied by the forward-looking statements are risks associated with the company's inability to sufficiently anticipate market needs and develop products and product enhancements that achieve market acceptance, the company's ability to compete effectively in the diagnostics and life sciences research markets, variability of the company's quarterly revenues and operating results, the failure of the company to retain key employees, the company's ability to obtain additional debt or equity financing Equity Financing

The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation.
, the possibility of declining sales due in part to a reduction in research and development budgets or government funding, the company's ongoing ability to protect its own intellectual property rights and to avoid violating the intellectual property rights of third parties, extended manufacturing difficulties and currency fluctuations. For more information about these and other factors that could cause actual results to differ materially from those contained in or implied by the forward-looking statements please see "Factors that May Affect Future Results" included in Stratagene's Annual Report on Form 10-K Form 10-K

A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information.


Form 10-K

See 10-K.
 for the year ended December 31, 2005 and in other reports filed by Stratagene from time to time with the Securities and Exchange Commission, including Quarterly Reports on Form 10-Q Form 10-Q

See 10-Q.
.
COPYRIGHT 2006 Business Wire
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2006, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Business Wire
Date:Nov 1, 2006
Words:981
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