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Biochemistry. Author manuscript; available in PMC 2011 June 13.
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Biochemistry. 2009 August 11; 48(31): 7525–7532. doi:10.1021/bi900332f.

Regulation of Lymphoid Tyrosine Phosphatase Activity:

Inhibition of the Catalytic Domain by the Proximal Interdomain†
Yingge Liu‡, Stephanie M. Stanford‡, Sonali P. Jog‡,§, Edoardo Fiorillo‡, Valeria Orrú‡,
Lucio Comai‡,§, and Nunzio Bottini*,‡
‡Institute for Genetic Medicine, Keck School of Medicine of the University of Southern California,

Los Angeles, California 90033

§Department of Molecular Microbiology and Immunology, Keck School of Medicine of the
University of Southern California, Los Angeles, California 90033

Abstract
The lymphoid tyrosine phosphatase LYP, encoded by the PTPN22 gene, recently emerged as a
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major player and candidate drug target for human autoimmunity. The enzyme includes a classical
N-terminal protein tyrosine phosphatase catalytic domain and a C-terminal PEST-enriched
domain, separated by an ∼300-amino acid interdomain. Little is known about the regulation of
LYP. Herein, by analysis of serial truncation mutants of LYP, we show that the phosphatase
activity is strongly inhibited by protein regions C-terminal to the catalytic domain. We mapped the
minimal inhibitory region to the proximal portion of the interdomain. We show that the activity of
LYP is inhibited by an intramolecular mechanism, whereby the proximal portion of the
interdomain directly interacts with the catalytic domain and reduces its activity.

The lymphoid tyrosine phosphatase LYP,1 encoded by the PTPN22 gene, recently emerged
as a key player and candidate drug target for human autoimmunity. LYP is an ∼105 kDa
Class I protein tyrosine phosphatase (PTP) (1,2) characterized by an ∼300-amino acid
classical N-terminal PTP domain and an ∼200-amino acid C-terminal domain which
includes four putative polyproline motifs [termed P1-P4 (Figure 1A)]. The catalytic domain
and the C-terminal domain are separated by an ∼300-amino acid region called the
“interdomain” (see Figure 1A) (3). In T cells, LYP and its mouse homologue called PEST-
enriched phosphatase (PEP) are known to potently inhibit T cell receptor (TCR) signaling
(4-8) through dephosphorylation of several substrates, including the Src family kinases Lck
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and Fyn, ZAP70, and TCRzeta (4,9). A genetic variant of LYP, caused by a C1858T
variation in PTPN22 and carrying Trp620 instead of Arg620 in the C-terminal domain, was
first reported to increase the risk of type 1 diabetes (10-13) and rheumatoid arthritis

†This work was supported by a grant from the National Institutes of Health (AI070544), a grant from the Juvenile Diabetes Research
Foundation (1-2005-342), and a grant from the Arthritis National Research Foundation (ANRF) to N.B. S.M.S. was supported by
National Institutes of Health Predoctoral Training Grant GM067587 in Cellular, Biochemical and Molecular Biology at the University
of Southern California. V.O. and E.F. were supported by Master&Back fellowships from the Sardinian government.
© XXXX American Chemical Society
*
To whom correspondence should be addressed: USC Institute for Genetic Medicine, 2250 Alcazar St., CSC 204, Los Angeles, CA
90033. Phone: (323) 442−2634. Fax: (323) 442−2764. E-mail: nunzio@usc.edu..
1Abbreviations: AP1, activator protein 1; DiFMUP, 6,8-difluoro-4-methylumbelliferyl phosphate; DTT, dithiothreitol; EDTA,
ethylene-diaminetetraacetic acid; EFα, elongation factor α; Fyn, oncogene related to SRC, FGR, and YES; FPLC, fast performance
liquid chromatography; HA, hemagglutinin; HEPES, 4-(2-hydroxyethyl)-1-piperazineethanesulfonic acid; JTAg; Jurkat large T
antigen; Lck, leukocyte-specific protein tyrosine kinase; LYP, lymphoid phosphatase; NFAT, nuclear factor of activated T cells; NTA,
nitrilotriacetic acid; PCR, polymerase chain reaction; PEP, PEST-enriched phosphatase; PMSF, phenylmethanesulfonyl fluoride; PTP,
protein tyrosine phosphatase; pTyr, phosphotyrosine; RPMI, Roswell Park Memorial Institute; SD, standard deviation; SDS, sodium
dodecyl sulfate; TCR, T cell receptor; WB, Western blotting; ZAP70, ζ-chain-associated protein kinase 70.
 Liu et al. Page 2

(6,12,14,15) and subsequently found to predispose humans to a whole range of autoimmune

diseases, including systemic lupus erythematosus, Graves’ and Addison's disease, and others
(reviewed in refs 16 and 17). LYP-W620 acts with a dominant mechanism and confers
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significant predisposition to autoimmunity even when present in a single copy. LYP-W620

was later shown to be a gain-of-function inhibitor of signaling and to have increased
phosphatase activity (7,18). The molecular mechanism of the gain-of-function phenotype of
LYP-W620 is currently unknown. It has been proposed that small molecule inhibitors of
LYP could reverse the effect of the pathogenic variation and have a therapeutic effect in the
treatment of autoimmunity (19).

Elucidating how LYP activity is regulated is important in understanding the mechanism of

action of LYP-W620, and it might lead to innovative approaches to modulating the
phosphatase activity for therapeutic purposes. Recently, the Zhang group reported that the
activity of LYP is regulated by phosphorylation of serine 35 in the catalytic domain (19).
However, little else is known about the regulation of LYP activity, and in particular, there is
no information available about possible regulatory effects of the interdomain. Here we
report that truncation of human LYP at amino acid 300 immediately C-terminal to the
catalytic domain causes a dramatic increase in phosphatase activity. We found that the 20
amino acids immediately proximal to the catalytic domain are responsible for most of the
effects of the truncation. We show that the activity of LYP is inhibited by an intramolecular
mechanism, whereby the proximal portion of the interdomain directly interacts with the
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catalytic domain and reduces its activity.

MATERIALS AND METHODS

Plasmids, Antibodies, and Other Reagents
Full-length LYP and its truncation mutants were cloned in the BamHI site of plasmid pEF5
(20) which allows the expression of constructs under control of the EFα promoter and in
fusion with an N-terminal HA tag. Site-directed mutagenesis and deletions were performed
by PCR. All mutants were assessed by full-length sequencing. The monoclonal anti-HA
antibody (clone 16B12) was purchased from Covance (Berkeley, CA). The pTyr peptide
(ARLIEDNEpYTAREG) and the peptide of amino acids 301−320
(HSGTESQAKHCIPEKNHTLQ) were ordered from Celtek Peptides (Nashville, TN). The
control peptide of amino acids 604−643 (biotin-
ATAPRIDDEIPPPLPVRTPESFIVVEEAGEFSPNVPKSLS) was purchased from Antagene
(Mountain View, CA). The purity of all peptides was >95%. All peptides were purchased as
lyophilized powder, and stock solutions were prepared in phosphatase buffer.

Purification of Recombinant Proteins

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For purification of recombinant proteins from insect cell lysates, full-length LYP and its
mutants and/or truncations were cloned in the BamHI site of pFastBac-HTa (Invitrogen,
Carlsbad, CA) in frame with a FLAG tag, and recombinant bacmids and baculoviruses were
produced using the Bac-to-Bac method (Invitrogen). Virus titers and times of incubation
were optimized to yield high levels of expression of full-length recombinant proteins in Sf9
cells. The proteins were purified from lysates of insect cells using single-step affinity
chromatography on M2-FLAG beads (Sigma, St. Louis, MO) and eluting with a
combination of FLAG peptide and high concentrations of DTT. The final buffer consisted of
50 mM Tris-HCl (pH 8.0), 0.5 mM EDTA, and 1 mM DTT. The purity of recombinant
proteins was more than 80% as assessed by silver stain of polyacrylamide gels (Figure 2B).
The yield of the isolation was around 1 μg of full-length protein/150 mm plate of infected
Sf9 cells. For purification of proteins from lysates of Escherichia coli, the constructs were
cloned in the BamHI and NotI sites of the pET28a vector (EMD Biosciences, San Diego,

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 Liu et al. Page 3

CA). Six-His-tagged proteins were purified from lysates of transformed BL21(DE3) cells by
two-step affinity chromatography on a Ni2+-NTA column, followed by cleavage of the six-
His tag by thrombin and further passage of the eluate on a benzamidine column for removal
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of the protease. The proteins were dialyzed against 50 mM Tris-HCl (pH 8.0), 0.5 mM
EDTA, and 1 mM DTT. The purity of eluted proteins was consistently more than 90% as
assessed by Coomassie blue staining of polyacrylamide gels (data not shown).

Cell Culture and Transfections

Jurkat cells expressing the SV-40 large T antigen (JTAg) (21) were kept at logarithmic
growth in RPMI 1640 medium supplemented with 10% FCS, 1 mM sodium pyruvate, 10
mM HEPES (pH 7.3), 2.5 mg/mL D-glucose, 100 units/mL penicillin, and 100 μg/mL
streptomycin. JTAg transfections were performed by electroporation at 240 V with a single
25 ms square pulse (7).

Immunoprecipitations/Pull-Downs and Western Blotting

For immunoprecipitations and pull-downs, cells were lysed in 20 mM Tris-HCl (pH 7.4),
150 mM NaCl, 5 mM EDTA, 1% NP-40 (TNE buffer), 1 mM PMSF, 10 μg/mL aprotinin/
leupeptin, and 10 μg/mL soybean trypsin inhibitor. Lysates were precleared by
centrifugation at 16000 rcf for 30 min. For immunoprecipitations, anti-HA antibody was
added to the precleared lysates followed by PG-Sepharose beads. For pull-downs,
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recombinant proteins were added to the precleared lysates, followed by Ni2+NTA-Sepharose

to precipitate the protein complex. Beads were washed four or five times in lysis buffer and
resuspended in SDS sample buffer.

Luciferase Assays
Luciferase assays were performed as described in ref 7. The NFAT/AP-1 reporter plasmid
(kindly provided by G. Crabtree, Stanford University, Stanford, CA) carries three tandem
copies of the distal NFAT/AP-1 composite element of the human IL2 promoter (21) which
are cloned upstream of the minimal IL2 promoter (from nucleotide −89 to +51) and the
luciferase reporter gene. The NFAT/AP-1 reporter plasmid and the control pGL3 plasmid,
driving constitutive expression of Renilla luciferase, were cotransfected in JTAg cells with
variable amounts of the appropriate HA-tagged constructs. Cells were subjected to TCR
stimulation with 1.5 μg/mL OKT3 (22) for 6 h, and then luciferase assays were performed in
triplicate on cell lysates using the dual luciferase kit from Promega (Madison, WI) according
to the manufacturer's instructions, and reading luminescence on a plate reader. The
difference in the ratio between firefly and Renilla luciferase activity in stimulated versus
unstimulated cells (TCR-induced increase in the level of activation of reporter) was then
plotted against the level of expression of constructs assessed by densitometric scanning of
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anti-HA blots of total lysates.

Phosphatase Assays
Phosphatase assays were conducted using 6,8-difluoro-4-methylumbelliferyl phosphate
(DiFMUP) or a 14-amino acid phosphotyrosine (pTyr) peptide (ARLIEDNEpYTAREG)
based on the Lck Y394 autophosphorylation site as a substrate (23). The buffer consisted of
50−100 mM Bis-Tris (pH 6.0) and 1−5 mM DTT buffer (phosphatase buffer). When
DiFMUP was used as a substrate, phosphatase activity was detected by continuously
monitoring the increase in fluorescence (λex = 360 nm, and λem = 460 nm). When the pTyr
peptide was used as a substrate, reactions were stopped by the addition of BIOMOL GREEN
REAGENT (BIOMOL International, Plymouth Meeting, PA), and the absorbance of the
solution was measured at 595 nm. The activity measured in triplicate was corrected for the
nonspecific signal of identical reactions performed also in triplicate without addition of

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 Liu et al. Page 4

enzyme. For detection of phosphatase activity of LYP immunoprecipitated from transfected

cells using DiFMUP as a substrate, the immunoprecipitates were washed three times in Bis-
Tris (pH 6.0) and then resuspended in phosphatase buffer. The activity corrected for the
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background fluorescence of the substrate alone was then normalized for LYP expression as
assessed by anti-HA blot of fractions of immunoprecipitates taken before resuspension in
the final phosphatase buffer. This assay showed a good range where the signal varied
linearly with the amount of immunoprecipitate added to the reaction (Figure 1B). Kinetic
parameters were calculated by plotting enzyme activity versus substrate concentration and
fitting the points to the Michaelis–Menten equation. For all phosphatase assays, the time of
reaction and the amount of enzyme were optimized to keep the activity in initial rate.

Gel Filtration Chromatography

Gel filtration chromatography was performed using the AKTA FPLC system (GE
Healthcare). Standards and experimental samples were separated using Superdex 75 10/300
GL (GE Healthcare) gel filtration columns. Standards [conalbumin (75 kDa), carbonic
anhydrase (29 kDa), and ovalbumin (43 kDa)] were run through the column to determine the
elution volume of each. The samples were centrifuged at 35000g for 10 min using an
ultracentrifuge followed by fractionation at a flow rate of 0.6 mL/min. A sample volume of
100 μL corresponding to 100 μg was loaded for each run. The elution volume of samples
was compared to the standards. Both standards and samples were fractionated using TNE or
phosphatase buffer.
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Graphs and Statistics

Proteins were aligned using ClustalW (24,25). Graphs, curve fittings, and kinetic parameter
calculations were performed using Graphpad Prism (Graphpad, San Diego, CA). Statistics
were calculated also using the same software or using Excel (Microsoft, Redmond, WA).
All SDs of differences and ratios were calculated according to the error propagation rules
described by Taylor (26).

RESULTS
Gjorloff-Wingren et al. reported that the catalytic activity of immunoprecipitated full-length
PEP is much lower than the activity of the catalytic domain alone (amino acids 1−290) and
suggested that the activity of PEP might be regulated by an intramolecular mechanism (5).
Since the degree of conservation between human LYP and mouse PEP is relatively low
outside the catalytic domain (the identity between amino acids 1−300 of LYP and amino
acids 1−300 of PEP is 87.4%, while the identity between amino acids 301−807 of LYP and
amino acids 301−802 of PEP is 60.7%), we first assessed whether truncation of LYP
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immediately C-terminal to the catalytic domain (LYP300, amino acids 1−300) leads to a
similar gain of function in the human phosphatase. Figure 1B shows that
immunoprecipitated LYP300 has approximately double the activity of immunoprecipitated
LYP in a Vmax phosphatase assay. Next we assessed whether truncation at amino acid 300
also leads to a gain of function in TCR signaling modulation. Figure 1C shows that LYP300
was a several-fold more potent inhibitor of TCR signaling in an NFAT-AP1 reporter assay,
suggesting that the inhibition of the catalytic domain of LYP by the C-terminal portion is
physiologically relevant in reducing the activity of the phosphatase. The increased gain of
function observed in the signaling assay compared to the effect on the phosphatase activity
is possibly due to amplification of signaling downstream of the phosphatase or to the
amplifying effect of TCR-induced post-translational modifications of the phosphatase. Next,
we purified full-length recombinant LYP, LYP300, and a series of LYP truncation mutants
as recombinant proteins from lysates of insect cells. An analysis of the interdomain with
DISOPRED (Bioinformatics Group, University College London, London, U.K.) did not

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reveal any predictable secondary structure. However, to minimize the chance of disrupting
secondary structure elements, truncation sites were placed in regions which the software
predicted to be less likely to be ordered. The mutants included truncations immediately C-
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terminal to the interdomain at amino acid 600 (LYP600), at two-thirds of the interdomain at
amino acid 517 (LYP517), and at one-third of the interdomain at amino acid 423 (LYP423)
(Figures 1A and 2A). When the activity of these proteins was compared in Vmax phosphatase
assays on two different substrates, LYP300 consistently exhibited greatly increased
phosphatase activity, while LYP423 was the only other one to exhibit slightly increased
activity (Figure 2C,D). Importantly, in these assays, the inactive mutants of LYP and
LYP300 (LYP/S227 and LYP300/S227) did not exhibit any activity (Figure 2C,D). These
data suggest that the N-terminal one-third of the interdomain between amino acids 300 and
423 (here called the N-interdomain) is responsible for the inhibition of the activity of
LYP300. To assess whether we could further map the region of the protein responsible for
the inhibition of the activity, we generated smaller truncation mutants of LYP within the N-
interdomain and measured their activity in Vmax assays. Figure 3A shows that truncation of
the 20 amino acids immediately C-terminal to LYP300 had the strongest effect on the
activity of the phosphatase, suggesting that the region between amino acids 301 and 320 is
responsible for most of the inhibitory effect of the N-interdomain on LYP300. In line with
this hypothesis, when LYP300 and LYP320 were purified from bacterial lysates and their
activity was compared, LYP320 was consistently less active than LYP300 on both DiFMUP
and the pTyr peptide. The kcat was 9.4 ± 0.2 (standard error) s−1 on DiFMUP and 11.0 ± 0.4
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(standard error) s−1 on pTyr peptide for LYP300 versus 2.8 ± 0.0 (standard error) s−1 on
DiFMUP and 5.5 ± 0.2 (standard error) s−1 on pTyr peptide for LYP320, while the KM was
6.1 ± 0.5 (standard error) μM on DiFMUP and 19.9 ± 2.4 (standard error) μM on pTyr
peptide for LYP300 versus 3.9 ± 0.3 (standard error) μM on DiFMUP and 51.1 ± 4.4
(standard error) μM on pTyr peptide for LYP320 (Figure 3B,C). Next we performed gel
filtration chromatography of recombinant LYP300 and LYP320 in TNE and phosphatase
buffers and found that both proteins elute as monomers with an elution volume of 12.0 mL,
in a molecular mass range between the 43 kDa (elution volume of 11.0 mL) and 29 kDa
(elution volume of 12.2 mL) standards (Figure 4A,B and data not shown). The
chromatogram excluded the fact that the difference in activity between LYP300 and
LYP320 is due to dimerization or multi-merization of LYP320. Overall, the data suggest
that the proximal portion of the interdomain inhibits the activity of LYP through an
intramolecular mechanism. Figure 4C shows that the recombinant N-interdomain could pull
down LYP300 from lysates of JTAg cells, which suggests that the intramolecular inhibition
of the phosphatase activity depends on a physical interaction between the N-interdomain and
LYP300. We then assessed whether a peptide encompassing the minimal inhibitory region
between amino acids 301 and 320 was able to inhibit the phosphatase activity when
incubated with LYP300 in trans. As a control, we also included a peptide of amino acids
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604−643, which spans the P1 and P2 motifs of LYP. Figure 5A shows that incubation of
LYP300 with the peptide of amino acids 301−320 led to substantial inhibition of the
phosphatase activity. The kcat was 9.0 ± 0.2 (standard error) s−1 in the absence of peptide
versus 5.2 ± 0.1 (standard error) s−1 in the presence of the peptide of amino acids 301−320
at 25 nM, while the KM was 5.2 ± 0.4 (standard error) μM in the absence of peptide versus
4.1 ± 0.2 (standard error) μM in the presence of the peptide of amino acids 301−320. Figure
5B shows that inhibition of the activity of LYP300 by the peptide of 25 nM 301−320 was
dose-dependent. Figure 5C shows that incubation of LYP300 with a control peptide of 25
nM 604−643 did not lead to any significant inhibition of the phosphatase activity. The kcat
was 8.8 ± 0.2 (standard error) s−1 in the absence of peptide versus 8.2 ± 0.3 (standard error)
s−1 in the presence of the peptide of amino acids 604−643 at 50 nM, while the KM was 7.0 ±
0.9 (standard error) μM in the absence of peptide versus 5.9 ± 0.9 (standard error) μM in the
presence of the peptide of amino acids 604−643.

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DISCUSSION
The interdomain of LYP is known to harbor putative phosphorylation and protein–protein
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interaction motifs, but little is known about its function. Our data suggest that the
interdomain plays an important role in regulating the catalytic activity through a direct
intramolecular interaction and inhibition of the catalytic domain. Several cytosolic PTPs
reportedly are physiologically regulated by intramolecular inhibition (27,28). For example,
SHP-1 is inhibited by a constitutive interaction between the catalytic and N-terminal SH2
domain, which is released following recruitment of the domain to phosphorylated targets
(28).

The inhibition of the catalytic domain by the interdomain might play an important
physiological role. For example, alterations of the interaction between these two domains
could indirectly mediate the functional effects of post-translational modifications and/or
protein interactions located in other portions of the protein.

We showed that the interaction between the proximal 20 amino acids of the interdomain and
LYP300 is responsible for a substantial portion of the inhibitory effect of the interdomain on
the activity of the phosphatase. As shown in Figures 2C,D and 3A, segments of the
interdomain distal to amino acid 320 also contribute to the inhibition of LYP activity.
Despite their relatively weak effect in our assays, distal portions of the interdomain could
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still play a critical physiological role in the cellular context. Also, all truncations distal to
amino acid 320 were either purified or precipitated from eukaryotic cells, where post-
translational modifications might be further complicating the picture. Further analysis is
needed to refine our knowledge of the role of distal segments of the interdomain in the
activity of the catalytic domain.

Our data suggest that the proximal 20 amino acids of the interdomain are able to inhibit the
phosphatase activity in cis and in trans phosphatase assays by a direct interaction with
LYP300. Some speculation about the structural basis of this phenomenon can be undertaken.
The crystal structure of the catalytic domain of LYP has been determined by the Zhang (19)
and Knapp (29) groups (Protein Data Bank entries 2P6X and 2QCT, respectively) and
recently by us (manuscript submitted for publication). Each of these structures shows that
the last helix of the catalytic domain (α6 helix, amino acids 275−300) lies in the proximity
of the D-loop and shows extensive interactions with the α3 helix (which directly follows the
D-loop on the primary structure). Thus, it is possible that the interaction between the
segment of amino acids 301−320 of the interdomain and the catalytic domain somehow
affects the position and range of movement of the D-loop. Structural analysis of larger
truncations of LYP would be extremely valuable in understanding the mechanism of
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intramolecular inhibition.

The results of our study are in line with the one reported for mouse PEP showing that
truncation at amino acid 290 leads to increased phosphatase activity (5). Conservation
throughout evolution suggests that inhibition of the catalytic domain by the proximal
interdomain is physiologically relevant. However, little can be concluded at the moment
about the mechanism of inhibition by looking at conservation of primary structure. The
critical segment of amino acids 301−320 does not show a higher level of conservation
between human LYP and mouse PEP than the rest of the interdomain: in the segment of
amino acids 301−320, nine amino acids are identical (45% identity) and 14 are similar (70%
similarity) (Figure 5D), while the whole interdomain (amino acids 301−600 of LYP and
amino acids 301−599 of PEP) showed 52% identity and 65.1% similarity between human
LYP and mouse PEP.

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In conclusion, we showed that there is an intramolecular regulation mechanism of LYP

phosphatase activity, which is mediated by an interaction between the interdomain of the
molecule and the catalytic domain. Further dissection of the interaction between the
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interdomain and LYP300 is desirable to identify the structural basis of the activity
inhibition.

Acknowledgments
We thank Sophia Tsai for help with the structure prediction software and Tobias Ulmer for useful discussion. We
declare no conflict of interest in relation to the data reported in this paper.

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Figure 1.
Truncation of LYP at amino acid 300 leads to a gain of function and increased phosphatase
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activity. (A) Schematic of the LYP structure showing the catalytic domain, the interdomain,
and the C-terminal domain. Sites where truncations were performed for this study are
denoted with arrows. (B) Immunoprecipitated LYP300 (amino acids 1−300) exhibits higher
phosphatase activity than LYP. JTAg cells were transfected with HA-LYP or HA-LYP300.
HA-LYP was immunoprecipitated from cell lysates, and its phosphatase activity was
assessed under Vmax conditions using 0.25 mM DiFMUP as a substrate, as described in
Materials and Methods. The left panel shows the linearity of the assay with respect to the
amount of input immunoprecipitate in cells transfected with HA-LYP. The middle panel
shows the average ± SD activity of immunoprecipitated HA-LYP (white column) or HA-
LYP300 (black column) after reaction for 50 s, normalized for LYP expression as assessed
by densitometry of anti-HA blots of fractions of the same immunoprecipitations. The right
panel shows an anti-HA blot of an aliquot of immunoprecipitates from cells transfected with
HA-LYP (lane 1) or HA-LYP300 (lane 2). IgH denotes heavy chains of immunoglobulins.
The statistical significance of the difference between LYP and LYP300 was calculated with

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 Liu et al. Page 10

a Student's t test (p value shown above the LYP300 column). (C) Truncation of LYP at
amino acid 300 leads to a gain of function. Activation of an NFAT/AP1 reporter in T cells
transfected with HA-LYP or HA-LYP300. JTAg cells were cotransfected with a 3 × NFAT/
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AP1 luciferase reporter and LYP or LYP300. Cells were stimulated for 6 h with OKT3 and
then lysed, and luciferase activity was measured on cell lysates. The average ± SD
stimulation-induced increase in the ratio between firefly and Renilla luciferase activities of
lysates of cells transfected with LYP (▲) or LYP300 (△), each measured in triplicate, was
plotted vs the transfected protein expression in the same lysates as assessed by anti-HA WB.
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Figure 2.
C-Terminal truncation of LYP within the interdomain shows that the N-terminal third of the
interdomain inhibits the catalytic activity. Full-length recombinant LYP and its truncation
mutants were isolated from lysates of baculovirus-infected insect cells as described in
Materials and Methods. (A) Schematic of the C-terminal truncations of LYP used for the
experiments shown in this figure. (B) Silver-stained gel showing 80 ng of LYP (lane 1),
LYP/S227 (lane 2), LYP300 (amino acids 1−300, lane 3), LYP300/S227 (lane 4), LYP423
(amino acids 1−423, lane 5), LYP517 (amino acids 1−517, lane 6), and LYP600 (amino
acids 1−600, lane 7). (C and D) Activity of LYP (black column), LYP600, LYP517,
LYP423, and LYP300 on DiFMUP (C) or pTyr peptide (D). The histograms show that LYP/
S227 and LYP300/S227 were completely inactive. The phosphatase assays were conducted
under Vmax conditions. Panel C shows the average ± SD activity measured in triplicate,
using 1 nM enzyme and 0.4 mM DiFMUP. Panel D shows the average ± SD activity
measured in triplicate, using 1 nM enzyme and 0.16 mM peptide.
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Figure 3.
Cis inhibition of LYP300 phosphatase activity by the segment of amino acids 301−320. (A)
Mapping of the minimal inhibitory interdomain segment. JTAg cells were transfected with
HA-LYP300 (amino acids 1−300), HA-LYP320 (amino acids 1−320), HA-LYP340 (amino
acids 1−340), HA-LYP360 (amino acids 1−360), HA-LYP380 (amino acids 1−380), or HA-
LYP400 (amino acids 1−400). HA-tagged proteins were immunoprecipitated from cell
lysates, and their phosphatase activity was assessed under Vmax conditions using DiFMUP
as a substrate, as in Figure 1B. The top panel shows the anti-HA WB of an aliquot of
immunoprecipitates from cells transfected with HA-LYP300 (lane 1), HA-LYP320 (lane 2),
HA-LYP340 (lane 3), HA-LYP360 (lane 4), HA-LYP380 (lane 5), or HA-LYP400 (lane 6).
IgH denotes heavy chains of immunoglobulins. The bottom panel shows the average ± SD
activity of immunoprecipitated HA-tagged proteins, normalized for LYP expression as
assessed by densitometry of anti-HA blots of fractions of the same immunoprecipitations.
Data were analyzed using ANOVA, followed by post-test analysis of the difference between
each truncation and the immediately preceding one in the series by the Bonferroni test. Only
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significant results are shown. (B and C) LYP300 (amino acids 1−300) and LYP320 (amino
acids 1−320) were isolated from lysates of E. coli as described in Materials and Methods.
(B) Activity of 5 nM LYP300 ( ) and LYP320 ( ) on DiFMUP. Points are
the average ± SD activity of LYP300 and LYP320 measured in triplicate plotted vs substrate
concentration. Lines are fits of data to the Michaelis–Menten equation. (C) Activity of 1 nM
LYP300 ( ) and LYP320 ( ) on the pTyr peptide. Points are the average ±
SD activity of LYP300 and LYP320 measured in triplicate plotted vs substrate
concentration. Lines are fits of data to the Michaelis–Menten equation.

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Figure 4.
Inhibition of LYP300 by the interdomain is due to an intramolecular mechanism. (A and B)
Gel filtration chromatograms of protein standards, LYP300 (amino acids 1−300), and
LYP320 (amino acids 1−320). Panel A shows the full chromatogram. Panel B shows a
magnification of the protein peaks. The proteins were eluted in phosphatase buffer [100 mM
Bis-Tris (pH 6.0) and 1 mM DTT]. Similar results were obtained when the same proteins
were eluted in TNE buffer (data not shown). The standards shown are conalbumin (75 kDa),
ovalbumin (43 kDa), and carbonic anhydrase (29 kDa). (C) Interaction between the N-
terminal one-third of the interdomain (amino acids 301−423) and LYP300. JTAg cells were
transfected with HA-tagged LYP300, and total lysates were subjected to pull-down using

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 Liu et al. Page 14

Ni2+-NTA bead-bound six-His-bound N-interdomain (lane 1) or beads alone (lane 2). Panel
C shows the anti-HA WB of pull-downs.
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Figure 5.
Dose-dependent trans inhibition of LYP300 phosphatase activity by a peptide of amino
acids 301−320. (A) Activity of 5 nM LYP300 (amino acids 1−300) on DiFMUP in the
absence ( ) or presence of a peptide of amino acids 301−320 at 25 nM ( ).
Points are the average ± SD activity of LYP300 measured in triplicate plotted vs substrate
concentration. Lines are fits of data to the Michaelis–Menten equation. (B) Dose–response
inhibition of LYP300 activity in the presence of increasing amounts of the peptide of amino
acids 301−320. The peptide was added to the buffer at the concentrations and
peptide:enzyme molar ratios indicated on the X-axis. The phosphatase assays were
conducted under Vmax conditions as described in Materials and Methods using 5 nM enzyme
and 0.4 mM DiFMUP and following the activity continuously. Graphs show the average ±
SD percent residual activity at 2 min, measured in triplicate. (C) Activity of 5 nM LYP300
(amino acids 1−300) on DiFMUP in the absence ( ) or presence of the control
peptide of amino acids 604−643 at 50 nM ( ). Points are the average ± SD activity of
LYP300 measured in triplicate plotted vs substrate concentration. Lines are fits of data to the
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Michaelis–Menten equation. (D) Alignment of the interdomains of LYP from Homo sapiens
(gi:48928054) and PEP from Mus musculus (gi:6679555). The fragment of amino acids
301−320 is highlighted in gray. Lines indicate identities; colons indicate conservative
substitutions, and periods indicate semiconservative substitutions.
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