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`UNITED STATES INTERNATIONAL TRADE COMMISSION
`WASHINGTON, D.C.
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`Before the Honorable Lord
`Administrative Law Judge
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`
`In the Matter of
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`CERTAIN MICROFLUIDIC SYSTEMS
`AND COMPONENTS THEREOF AND
`PRODUCTS CONTAINING SAME
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`Investigation No. 337-TA-1100
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`COMPLAINANT 10X GENOMICS, INC.’S SUBMISSION ON THE PUBLIC INTEREST
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`Complainant’s Public Interest Submission
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`Inv. No. 337-TA-1100
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`PUBLIC VERSION
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`Pursuant to 19 C.F.R. § 210.50(a)(4), 10X submits the following statement concerning
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`public interest. 10X has requested that the Commission issue a limited exclusion order, issue a
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`permanent cease and desist order, and impose a bond of 100% of the entered value of the infringing
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`imports. The ALJ concluded there was a violation in the importation of Bio-Rad’s ddSEQ system
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`and recommended that a limited exclusion order and cease and desist order issue with respect to
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`the infringing products and a bond of
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`. RD at 1-3, 5. Public interest was not delegated to the
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`ALJ in this investigation. 10X respectfully submits that the proposed remedial orders are consistent
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`with the public interest. The subject products are intended for scientific and medical research. See,
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`e.g., Bio-Rad’s Comments on Public Interest (“PI”) at 1 (Jan. 26, 2018). The actual use of Bio-
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`Rad’s ddSEQ product is not extensive. For example, Bio-Rad placed only 69 instruments through
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`Q2 2018. See Inv. No. 337-TA-1068 (“1068”), Reply re PI (July 25, 2019) at 44. In comparison,
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`from Q2 2015 to Q2 2018, 10X sold 700 instruments. See JX-0043. 10X’s own products can fill
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`any demand for subject products in both quantity (where 10X has vastly outsold Bio-Rad already)
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`and quality (where 10X offers higher quality and greater versatility than Bio-Rad). Moreover, to
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`address any potential public interest concern, 10X does not oppose a limited carveout for sales of
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`consumables imported for sale to customers who have access to existing instruments in the United
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`States as of the Target Date so that Bio-Rad’s current customers with access to existing instruments
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`may continue to perform their research, as well as for warranty support, service, repair, and
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`replacement of existing instruments if such warranty is currently offered and covers such activities.
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`I.
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`THE REMEDIES WILL NOT HARM PUBLIC HEALTH OR WELFARE
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`There are no public health, safety, or welfare concerns relating to the requested remedial
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`orders. Bio-Rad has admitted this: “Bio-Rad does not contend that the issuance of the requested
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`remedial relief would adversely affect public welfare or health in the United States, other than as
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`Complainant’s Public Interest Submission
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`identified in relation to the other public interest considerations.1 This is consistent with Bio-Rad’s
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`position in 337-TA-1068.” Bio-Rad’s Comments on PI at 3-4 n.2. While 10X disputes Bio-Rad’s
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`position in the 1068 investigation as applied to 10X’s widely-used products, Bio-Rad should not
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`be heard to argue now that excluding its own products would present such a concern.
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`10X’s products are used by top researchers across the country for research that has long
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`term implications for public health. See, e.g., 10X Post-Hr’g Br. at 107-115 (Apr. 12, 2019)
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`(discussing examples of scientific publications and literature using 10X’s products). To date, 10X
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`instruments have generated data for more than 500 peer-reviewed articles, more than 200 of which
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`were published so far this year alone. See 10X Form S-1 at 110 (Aug. 19, 2019)
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`(https://www.sec.gov/Archives/edgar/data/1770787/000119312519224368/d737378ds1.htm).
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`Bio-Rad can make no such claim, instead having only a handful of publications using ddSEQ.
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`See, e.g., https://www.ncbi.nlm.nih.gov/pubmed/?term=ddSEQ (PubMed search for “ddSEQ”
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`providing 2 results). There were far more 10X-based peer-reviewed publications in 2018 alone
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`than Bio-Rad’s total instrument placements through the second quarter of 2018. While such
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`research can have public health implications, as it does for 10X’s products, there are no such
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`implications for new sales of Bio-Rad’s ddSEQ products because 10X can replace any and all such
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`sales. Also, 10X’s carveout would prevent interruption to ongoing use of existing instruments.
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`II.
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`10X’S PRODUCTS CAN REPLACE ALL BIO-RAD EXCLUDED PRODUCTS
`WITH NO HARM TO COMPETITIVE CONDITIONS
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`Bio-Rad portrays itself as 10X’s competitor and has sought to compete with 10X in the
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`market. However, despite its competitive efforts, Bio-Rad has not been able to achieve anything
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`like the wide use of 10X’s products. Thus, not only can 10X’s products entirely replace Bio-Rad’s,
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`1 Bio-Rad’s arguments regarding other public interest factors in the same submission did not
`address public health or welfare. Id. passim.
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`this would have no material impact on competitive conditions in the United States. 10X’s products,
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`and in particular 10X’s Single Cell 3’ Solution, provide similar functionality to that of the subject
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`products for single-cell transcriptomics. See ID on Violation of Sec. 337 at 1, 3, 31-33, 64-66, 85-
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`88, 113-118 (July 12, 2019). 10X’s products perform better than the Accused Products according
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`to factors important to the single-cell sequencing applications at issue. See 10X’s Statement
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`Concerning the PI at 3 (Jan. 9, 2018). For example, a customer common to Bio-Rad and 10X stated
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`that Bio-Rad’s product was “completely inadequate for any profiling of complex tissues, including
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`immune cells from blood and gut biopsies,” and was “simply not up to the task” while stating that
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`10X’s product “completely transformed our capacity to conduct scRNAseq research. . . .” 1068,
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`Gibson of Georgia Tech Resp. to Comm’n Notice at 1, 3 (June 29, 2019) (emphasis added).
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`10X’s qualitative and quantitative superiority and Bio-Rad’s minimal sales show that
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`excluding Bio-Rad’s products would have no material impact on competitive conditions. 10X has
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`capacity well in excess of the at-most minimal additional demand resulting from the proposed
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`remedies. Bio-Rad had only placed 69 instruments through Q2 2018, whereas 10X had placed 700
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`instruments through Q2 2018 with rapidly growing sales continuing through present. While Bio-
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`Rad has argued that eliminating a large supplier can be bad for competitive conditions (see Bio-
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`Rad PI Statement at 4), Bio-Rad is not a large supplier of the relevant products. Absorbing any
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`Bio-Rad prospective sales will have no material impact on 10X’s capacity nor on the market itself.
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`See 10X’s Statement Concerning the PI at 4-5 (describing manufacturing capacity and
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`investments). If Bio-Rad questions whether other pending litigation will affect 10X’s ability to
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`meet demand,2 this is not a concern. In May 2019, 10X commercially introduced new products
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`2 In Inv. No. 337-TA-1068 a final determination is pending. In Case No. 1:15-cv-00152-RGA,
`10X is in the process of appealing a permanent injunction and jury verdict.
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`based on a new chip design called Next GEM (previously called “Chip SE”), including Single Cell
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`3’ Gene Expression and ATAC-seq, which perform the same assays as Bio-Rad’s current
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`commercial products (WTA 3’ and ATAC-Seq), and Single Cell V(D)J for which Bio-Rad does
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`not offer a solution. See 1068, 10X Reply Submission on PI at 31 (July 25, 2019). 10X’s Next
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`GEM, which was found non-infringing in the 1068 investigation (see 1068, ID on Violation of
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`Sec. 337 at 61-68, 84-85 (Sept. 20, 2018)) and was not accused and is not subject to injunction in
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`Case No. 1:15-cv-00152-RGA, can fill the demand entirely by itself.
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`Bio-Rad has also insisted repeatedly that numerous alternatives exist to both ddSEQ and
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`10X’s own products. See, e.g., 1068, Bio-Rad Reply Supp. Submission on PI at 6 n.4 (July 30,
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`2019) (“No final determination has been made in the 1100 investigation, and, as discussed herein,
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`numerous alternatives exist for each infringing 10X product.”); 34 (“there is a healthy amount of
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`competition in the NGS marketplace such that there are acceptable substitutes for all of 10X’s
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`solutions”). Bio-Rad’s assertions that there are suitable alternatives to 10X’s products are incorrect
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`as the evidence showed in the 1068 investigation. Nevertheless, having argued repeatedly that
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`suitable substitutes exist, Bio-Rad should not be heard to argue otherwise here.
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`III. THERE WILL BE NO NEGATIVE IMPACT ON PRODUCTION OF “LIKE OR
`DIRECTLY COMPETITIVE” ARTICLES IN THE UNITED STATES
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`The production of “like or directly competitive” articles in the United States will not be
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`harmed and may be helped by the recommended orders.
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`Interrog. 3); CX-0005C.00006 Q/A 21 (Vander Veen WS). Substituting 10X’s products for Bio-
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`Rad’s will not harm domestic production and will, if anything, increase it.
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` CX-0041C.00004 (Bio-Rad’s Resp. to
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`IV.
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`THE LEO AND CDO WILL NOT SUBSTANTIALY IMPACT U.S. CONSUMERS
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`A limited exclusion order and cease and desist order would have minimal impact on
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`consumers. Few consumers have adopted Bio-Rad’s ddSEQ, and those that have access to existing
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`ddSEQ instruments would be free to perform their research under the carveout described above.
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`While there is no material harm to consumers from excluding Bio-Rad’s products, there is a benefit
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`in enforcing 10X’s rights in this market, as Bio-Rad has admitted in the 1068 investigation:
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`Protecting and enforcing intellectual property rights rewards innovation and
`provides incentives for future research and development. Patent protection allows
`for innovation-intensive industries (such as NGS) to earn returns on large research
`and development investments that are needed for better technologies. The benefits
`of these incentives are particularly significant here, as Bio-Rad has taken great risks
`and spent millions of dollars to develop innovative NGS products.
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`1068, Bio-Rad’s Submission on Remedy, PI, and Bond at 19-20 (Dec. 17, 2018). Here,
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`. See Order 19 at 4-5.
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`Bio-Rad has admitted that “‘the mere constriction of choice cannot be a sufficient basis for
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`denying the issuance of an exclusion order,’ and excluding substitutable products with a tiny
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`market penetration does not harm consumers.” 1068, Bio-Rad’s Post-Hr’g PI Submission at 5 (Oct.
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`29, 2018) (quoting Certain Personal Data & Mobile Commc’n & Related Software, Inv. No. 337-
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`TA-710, Comm’n Op. at 69 (Dec. 19, 2011)). Bio-Rad cannot credibly argue that the remedies
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`present more than a “mere constriction of choice” because so few consumers actually choose Bio-
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`Rad’s product.
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`The proposed remedies are in the public interest. Moreover, the Commission “need only
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`decide that the public interest does not preclude” the remedy. Certain Cigarettes and Packaging
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`Thereof, Inv. No. 337-TA-643, Comm’n Op., at 28 (Oct. 1, 2009) (emphasis added). As no public
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`interest factor warrants precluding a remedy here, the Commission should issue the recommended
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`LEO and CDO upon finding a violation of Section 337.
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`Dated: August 26, 2019
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`Respectfully submitted,
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`
` /s/ Matthew D. Powers
`
`
`
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`
`
`Matthew D. Powers
`Paul T. Ehrlich
`Azra M. Hadzimehmedovic
`Aaron M. Nathan
`Stefani C. Smith
`Robert L. Gerrity
`Samantha A. Jameson
`Jennifer K. Robinson
`Yi Chen
`Gina Cremona
`Utsav Gupta
`Daniel M. Radke
`TENSEGRITY LAW GROUP, LLP
`555 Twin Dolphin Drive, Suite 650
`Redwood Shores, CA 94065
`Telephone:
`(650) 802-6000
`Facsimile:
`(650) 802-6001
`Email:
`10x_tlg_service@tensegritylawgroup.com
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`
`
`
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`
`
`Nicholas Groombridge
`Jennifer H. Wu
`Josephine Young
`Jennifer Rea Deneault
`PAUL, WEISS, RIFKIND,
` WHARTON & GARRISON LLP
`1285 Avenue of the Americas
`New York, New York 10019
`(212) 373-3000 (telephone)
`(212) 757-3990 (facsimile)
`ngroombridge@paulweiss.com
`jwu@paulweiss.com
`jyoung@paulweiss.com
`jdeneault@paulweiss.com
`
`David J. Ball
`Megan F. Raymond
`PAUL, WEISS, RIFKIND,
` WHARTON & GARRISON LLP
`2001 K Street, NW
`Washington, DC 20006
`(202) 223-7300 (telephone)
`(202) 223-7420 (facsimile)
`dball@paulweiss.com
`mraymond@paulweiss.com
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`
`Attorneys for Complainant,
`10X Genomics, Inc.
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`Complainant’s Public Interest Submission
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`CERTIFICATE OF SERVICE
`
`
`The undersigned hereby certifies that on August 26, 2019, copies of the foregoing were served
`upon the following parties as indicated below:
`
`
`Via Electronic Filing (EDIS)
`Via Hand Delivery (8 copies)
`
`Via Hand Delivery (2 copies) and
`Via E-mail
`edward.jou@usitc.gov
`
`
`Via E-mail
`monica.bhattacharyya@usitc.gov
`
`
`Via E-mail
`bio-rad-itc@quinnemanuel.com
`
`
`The Honorable Lisa R. Barton
`Secretary
`U.S. International Trade Commission
`500 E Street, SW, Room 112-A
`Washington, DC 20436
`
`The Honorable Dee Lord
`U.S. International Trade Commission
`500 E Street, S.W., Room 317
`Washington, D.C. 20436
`
`Ted Jou
`Attorney-Advisor to The Honorable Dee Lord
`
`Monica Bhattacharyya
`Investigative Attorney
`Office of Unfair Import Investigations
`U.S. International Trade Commission
`500 E Street SW
`Washington, DC 20436
`202-205-1848
`
`S. Alexander Lasher
`Jeffrey Gerchick
`Ethan Glass
`QUINN EMANUEL URQUHART & SULLIVAN, LLP
`777 6th Street NW, 11th Floor
`Washington, DC 20001
`Tel.: (202) 538-8102
`Fax: (202) 538-8100
`
`Counsel for Respondent Bio-Rad Laboratories, Inc.
`
`
`
`
`
`
`
`
` /s/ Megan Nelson
`Megan Nelson
`Paralegal
`
`
`
`
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`Complainant’s Public Interest Submission
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`7
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`Inv. No. 337-TA-1100
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`PUBLIC VERSION
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`CERTIFICATE OF SERVICE
`
`The undersigned hereby certifies that on August 27, 2019, copies of the foregoing were served
`upon the following parties as indicated below:
`
`Via Electronic Filing (EDIS)
`Via Hand Delivery (8 copies)
`
`Via E-mail
`edward.jou@usitc.gov
`
`Via E-mail
`monica.bhattacharyya@usitc.gov
`
`Via E-mail
`bio-rad-itc@quinnemanuel.com
`
`The Honorable Lisa R. Barton
`Secretary
`U.S. International Trade Commission
`500 E Street, SW, Room 112-A
`Washington, DC 20436
`
`The Honorable Dee Lord
`U.S. International Trade Commission
`500 E Street, S.W., Room 317
`Washington, D.C. 20436
`
`Ted Jou
`Attorney-Advisor to The Honorable Dee Lord
`
`Monica Bhattacharyya
`Investigative Attorney
`Office of Unfair Import Investigations
`U.S. International Trade Commission
`500 E Street SW
`Washington, DC 20436
`202-205-1848
`
`S. Alexander Lasher
`Jeffrey Gerchick
`Ethan Glass
`QUINN EMANUEL URQUHART & SULLIVAN, LLP
`777 6th Street NW, 11th Floor
`Washington, DC 20001
`Tel.: (202) 538-8102
`Fax: (202) 538-8100
`
`Counsel for Respondent Bio-Rad Laboratories, Inc.
`
` /s/ Megan Nelson
`Megan Nelson
`Paralegal
`
`Complainant’s Public Interest Submission
`
`Inv. No. 337-TA-1100
`
`PUBLIC VERSION
`
`