Oracle Corporation et al v. SAP AG et al

Filing 764

MOTION No. 2: to exclude testimony of Defendants' Expert Brian Sommer filed by Oracle EMEA Limited, Oracle International Corporation, Oracle USA Inc., Siebel Systems, Inc.. Motion Hearing set for 9/30/2010 09:00 AM in Courtroom 3, 3rd Floor, Oakland. (House, Holly) (Filed on 8/19/2010)

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Oracle Corporation et al v. SAP AG et al Doc. 764 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BINGHAM MCCUTCHEN LLP DONN P. PICKETT (SBN 72257) GEOFFREY M. HOWARD (SBN 157468) HOLLY A. HOUSE (SBN 136045) ZACHARY J. ALINDER (SBN 215695) BREE HANN (SBN 215695) Three Embarcadero Center San Francisco, CA 94111-4067 Telephone: 415.393.2000 Facsimile: 415.393.2286 donn.pickett@bingham.com geoff.howard@bingham.com holly.house@bingham.com zachary.alinder@bingham.com bree.hann@bingham.com BOIES, SCHILLER & FLEXNER LLP DAVID BOIES (Admitted Pro Hac Vice) 333 Main Street Armonk, NY 10504 Telephone: 914.749.8200 dboies@bsfllp.com STEVEN C. HOLTZMAN (SBN 144177) 1999 Harrison St., Suite 900 Oakland, CA 94612 Telephone: 510.874.1000 sholtzman@bsfllp.com DORIAN DALEY (SBN 129049) JENNIFER GLOSS (SBN 154227) 500 Oracle Parkway, M/S 5op7 Redwood City, CA 94070 Telephone: 650.506.4846 Facsimile: 650.506.7114 dorian.daley@oracle.com jennifer.gloss@oracle.com Attorneys for Plaintiffs Oracle USA, Inc., et al. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA OAKLAND DIVISION ORACLE USA, INC., et al., v. Plaintiffs, No. 07-CV-01658 PJH (EDL) NOTICE OF MOTION AND MOTION NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER Date: September 30, 2010 Time: 9:00 a.m. Place: 3rd Floor, Courtroom 3 Judge: Hon. Phyllis J. Hamilton Case No. 07-CV-01658 PJH (EDL) SAP AG, et al., Defendants. A/73465303.3 ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER Dockets.Justia.com 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 VII. VI. V. IV. I. II. III. TABLE OF CONTENTS Page SUMMARY OF INADMISSABLE OPINIONS AND RELIEF REQUESTED .............. 1 WHAT DEFENDANTS MUST SHOW TO JUSTIFY SOMMER'S OPINIONS AND WHAT THE COURT MUST DO TO TEST THEM............................................... 3 LEGAL STANDARDS MANDATING EXCLUSION OF SOMMER'S TESTIMONY..................................................................................................................... 4 A. No Relevant Expertise............................................................................................ 4 B. No Expert Analysis. ............................................................................................... 4 C. Flawed or No Methodology. .................................................................................. 5 D. Inadequate Factual Support.................................................................................... 5 SOMMER'S OPINIONS ABOUT HOW ERP CUSTOMERS MAKE DECISIONS ABOUT AFTER-MARKET SUPPORT SHOULD BE EXCLUDED ...................................................................................................................... 6 A. Sommer Lacks Relevant Experience ..................................................................... 6 B. Sommer's Opinions Are Not Based On Sufficient Information And Data............ 7 C. Sommer's Opinions Neither Consider Nor Concern The Facts Of This Case ........................................................................................................................ 8 SOMMER'S TESTIMONY RELATED TO ALTERNATIVE THIRD-PARTY SUPPORT OPTIONS SHOULD BE EXCLUDED AS UNRELIABLE AND UNTIMELY AFFIRMATIVE OPINION ....................................................................... 10 A. Sommer Lacks Relevant Experience ................................................................... 11 B. Sommer's Opinions Are Not Based On Sufficient Information And Data.......... 11 C. Sommer's Opinions Are Based On An Unreliable Methodology........................ 12 D. Sommer's Generalized Opinions Are Not Relevant Because They Neither Concern Nor Consider The Facts Of This Case................................................... 13 E. Sommer's Testimony About General Support Options Is Not Rebuttal And Should Be Excluded Pursuant To FRCP 37......................................................... 14 SOMMER'S OPINIONS AND TESTIMONY CONCERNING SELF-SUPPORT AS A "VIBRANT ALTERNATIVE" SHOULD BE EXCLUDED................................ 16 A. Sommer Lacks Relevant Expertise ...................................................................... 16 B. Sommer's Generalized Opinions Are Not Based On Sufficient Information And Are Not Relevant Because They Neither Concern Nor Consider The Facts Of This Case ............................................................................................... 16 SOMMER'S OPINIONS AND TESTIMONY REGARDING THE GENERAL EFFECTIVENESS OF SWITCHING PROGRAMS SHOULD BE EXCLUDED ........ 17 A. Sommer Lacks Relevant Qualifications............................................................... 17 B. Sommer's Opinion Is Not Based On A Reliable Methodology Applied To Sufficient Data ..................................................................................................... 18 C. Sommer's General Opinions Of Switching Programs Do Not Consider And Are Not Relevant To The Facts Of This Case ............................................. 19 i Case No. 07-CV-01658 PJH (EDL) A/73465303.3 ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 A/73465303.3 TABLE OF CONTENTS (continued) VIII. Page IX. X. SOMMER'S OPINIONS REGARDING THE EFFECTIVENESS OF SAP'S SAFE PASSAGE PROGRAM AND THE REASONABLENESS OF SAP'S EXPECTATIONS ABOUT IT SHOULD BE EXCLUDED........................................... 19 A. Sommer's Opinion On Whether SAP's Stated Goals For The Safe Passage Program Were Reasonable Should Be Excluded ................................................. 20 1. Sommer's opinion about the unreasonableness of SAP's goals was not timely disclosed ................................................................................. 20 2. Sommer Lacks Relevant Experience ....................................................... 21 3. Sommer's Opinions Are Not Based On Sufficient Data And Information............................................................................................... 21 4. Sommer's Safe Passage Opinions Are Not Based On A Reliable Methodology ............................................................................................ 23 SOMMER'S OPINIONS AND TESTIMONY REGARDING HOW ERP CUSTOMERS IN GENERAL MAKE DECISIONS ABOUT PURCHASING OF ERP SOFTWARE ALSO SHOULD BE EXCLUDED .................................................. 24 A. Sommer Lacks Relevant Experience Or Factual Support.................................... 24 B. Sommer's Opinion That ERP Customers Do Not Select Their Future ERP Vendor Simply Because Of A Lower-Cost Support Offering On Their Existing ERP Software Should Be Excluded....................................................... 25 CONCLUSION ................................................................................................................ 26 ii Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CASES TABLE OF AUTHORITIES Page Abuan v. General Elec. Co., 3 F.3d 329 (9th Cir. 1993)....................................................................................................... 24 Adams v. U.S., 2009 WL 1324231 (D. Idaho)................................................................................................. 22 Ahlberg v. Chrysler Corp., 481 F.3d 630 (8th Cir. 2007)............................................................................................... 5, 23 Beech Aircraft Corp v. United States, 51 F.3d 834 (9th Cir. 1995)....................................................................................................... 5 Burnham v. U.S., 2009 WL 2169191 (D. Ariz.).................................................................................................. 15 Cabrera v. Cordis Corp., 134 F.3d 1418 (9th Cir. 1998)................................................................................................... 6 Carnegie Mellon Univ. v. Hoffman-Laroche, Inc., 55 F.Supp.2d 1024 (N.D. Cal. 1999) .................................................................................. 3, 12 Claar v. Burlington R.R., 29 F.3d 499 (9th Cir. 1994)....................................................................................................... 3 Daubert v. Merrell Dow Pharm., 43 F.3d 1311 (9th Cir. 1995)........................................................................................... 3, 5, 12 Daubert v. Merrell Dow Pharm. Inc., 509 U.S. 579 (1993) .............................................................................................................. 3, 5 Diviero v. Uniroyal Goodrich Tire Co., 114 F.3d 851 (9th Cir. 1997)..................................................................................................... 5 General Electric Co. v. Joiner, 522 U.S. 136 (1997) ...................................................................................................... 4, 18, 25 Guidroz-Brault v. Mo. Pac. R.R. Co., 254 F.3d 825 (9th Cir. 2001)..................................................................................................... 6 Heller v. Shaw, 167 F.3d 146 (3d Cir. 1999)...................................................................................................... 4 IBM Corp. v. Fasco Industries, Inc., 1995 WL 115421 (N.D. Cal.).................................................................................................. 15 A/73465303.3 iii Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 A/73465303.3 TABLE OF AUTHORITIES (continued) Page In re Ready-Mix Concrete Antitrust Litig., 2009 U.S. Dist. LEXIS 82043 (S.D. Ill.) ................................................................................ 15 Jinro America, Inc. v. Secure Investments, Inc., 266 F.3d 993 (9th Cir. 2001)......................................................................................... 8, 13, 19 Kilgore v. Carson Pirie Holdings, Inc., 2006 WL 3253490 (6th Cir.)................................................................................................. 5, 8 Maionchi v. Union Pacific Corp., 2007 WL 2022027 (N.D. Cal.)................................................................................................ 20 Matrix Motor Co. v. Toyota Jidosha Kabushiki Kaisha, 290 F.Supp.2d 1083 (C.D. Cal. 2003) ...................................................................................... 5 Mukhtar v. California State University, 299 F.3d 1053 (9th Cir. 2002), as amended, 319 F.3d 1073 (9th Cir. 2003) ........................... 3 Nationwide Transport Finance v. Cass Information Systems, Inc., 523 F.3d 1051 (9th Cir. 2008)................................................................................................. 24 Nebraska Plastics, Inc. v. Holland Colors Americas, Inc., 408 F.3d 410 (8th Cir. 2005)....................................................................................... 13, 19, 25 Nuveen Quality Income Mun. Fund Inc. v. Prudential Equity Group, LLC, 262 Fed. Appx. 822 (9th Cir. 2008) .......................................................................................... 6 Ollier v. Sweetwater Union High School Dist., 267 F.R.D. 339 (S.D. Cal. 2010)............................................................................................. 18 On Davis v. Gap, 246 F.3d 152 (2d Cir. 2001).................................................................................................... 25 Perry v. Schwarzenegger, 2010 WL 3025614 (N.D. Cal.).................................................................................... 3, 4, 5, 13 QR Spex, Inc. v. Motorola, 2004 WL 5642907 (C.D. Cal.)............................................................................................ 6, 10 Rambus, Inc. v. Hynix Semiconductor, Inc., 254 F.R.D. 597 (N.D. Cal. 2008) ............................................................................................ 17 Redfoot v. B. F. Ascher & Company, 2007 WL 1593239 (N.D. Cal.).................................................................................................. 4 iv Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 A/73465303.3 TABLE OF AUTHORITIES (continued) Page Robinson v. G.D. Searle & Co., 286 F.Supp.2d 1216 (N.D. Cal. 2003) ................................................................................ 6, 10 Salinas v. Amteck of Kentucky, Inc., 682 F.Supp.2d 1022 (N.D. Cal. (PJH) 2010) ................................................................ 3, 4, 5, 7 Sunstar, Inc. v. Alberto-Culver Co., Inc., 2004 WL 1899927 (N.D. Ill.).................................................................................................. 14 Trout v. Milton S. Hershey Medical Center, 576 F.Supp.2d 673 (M.D. Pa. 2008) .......................................................................... 8-9, 14, 19 U.S. v. Walker, 217 Fed.Appx. 714 (9th Cir. 2007) ........................................................................................... 8 United States v. Chang, 207 F.3d 1169 (9th Cir. 2000)............................................................................................. 4, 16 United States v. Jawara, 474 F.3d 565 (9th Cir. 2007)..................................................................................................... 3 Wallach v. Longevity Network, Ltd., 2006 WL 5106208 (C.D. Cal.)................................................................................................ 11 STATUTES 17 U.S.C. 504(b) ........................................................................................................................ 24 RULES Fed. R. Civ. Proc. 26 ............................................................................................................... 15, 20 Fed. R. Civ. Proc. 37 .............................................................................................................. passim Fed. R. Civ. Proc. 104 ..................................................................................................................... 3 Fed. R. Evid. 702 ................................................................................................................... passim v Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PLEASE TAKE NOTICE that on September 30, 2010, at 9:00 a.m., in the courtroom of the Honorable Phyllis J. Hamilton, of the above-entitled Court, Plaintiffs Oracle USA, Inc. (predecessor to Oracle America, Inc.), Oracle International Corporation, Oracle EMEA Limited and Siebel Systems, Inc. (collectively "Oracle" or "Plaintiffs") shall move for an order excluding opinions and testimony of Brian S. Sommer, ("Sommer") designated by Defendants SAP AG, SAP America, Inc., and TomorrowNow, Inc. ("SAP TN") (collectively "Defendants") as an expert witness in this matter, on the grounds that his proposed expert opinion testimony is inadmissible on the basis of the authorities and evidence set forth herein and in the accompanying declaration. I. SUMMARY OF INADMISSABLE OPINIONS AND RELIEF REQUESTED Defendants' expert Brian Sommer is offered in supposed rebuttal to certain portions of the testimony of Plaintiffs' damages expert Paul Meyer. His report opines on certain topics related to causation of damages, namely, whether SAP TN's customers would more likely than not have stayed with Oracle absent the infringement that enabled SAP TN to offer support services, and whether SAP TN's discounted or free support helped enable SAP to convert Oracle customers to SAP applications. He also opined for the first time at his deposition that SAP's forecasts for its Safe Passage program (SAP's marketing program to entice Oracle's acquired PeopleSoft, J.D. Edwards ("JDE") and then Siebel customers with SAP TN as its "cornerstone") were unreasonable. Virtually all of Sommer's opinions are objectionable under the threshold requirements for expert testimony. First, he admittedly lacks the experience to qualify him to opine on enterprise resource planning ("ERP") customers' selection of support providers or consideration of low cost support in making their applications purchases. He has never participated in an ERP customer's support selection decision, and has helped in only one ERP application selection since the turn of the century and that was for a vendor and customer not involved here. He has never advised any ERP customer where discounted support on the customer's current applications was an available enticement. He has also not consulted for any of the parties in this case the leading ERP companies or any other company he identified as a major ERP software vendor, or evaluated the success or failure of any ERP vendor's marketing efforts to switch customers from another vendor. In addition, Sommer's opinions are based on insufficient, unreliable and/or irrelevant A/73465303.3 1 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 information and data. In connection with his opinions on what matters to ERP applications and support customers and what support options they had besides SAP TN, Sommer relied almost exclusively on untested information he found on company websites and other material he found on the internet. He did no ERP or support vendor or customer surveys or interviews. And he failed to consider considerable evidence that contradicted his conclusions, including the testimony and declarations of customers at issue in the case and the parties' contemporaneous assessments that SAP TN was the only viable alternative to Oracle. Admissible expert opinions cannot be so poorly grounded. Sommer's negative opinions about the actual or likely success of ERP vendors' "switching" programs, and in particular, about SAP's Safe Passage program, have literally no basis. Sommer had no information about actual conversion rates or any other metric of success for any such switching program. Again he relied on no actual case information. His opinions that such programs generally and Safe Passage particularly are ineffectual and thus that SAP's expectations for Safe Passage were unreasonable are pure ipse dixit, and unreliable. Sommer's general overview of third-party and self-support options supposedly available to ERP software users also is not proper rebuttal to Oracle's damages expert's opinions. His observations are not bounded by the relevant time period or needs of the SAP TN customers at issue and consider no case evidence. Meyer's causation conclusions were, in contrast, entirely tied to the specific customer facts and the evidence about support options presented in the case evidence. Thus Sommer does not rebut Meyer. If Defendants had wanted to offer a general market study, they should have presented it when initial reports were due, which would have given Oracle adequate opportunity to assess and rebut it. Incredibly, Defendants have filed a motion in limine to bar Meyer from even responding to Sommer's disguised affirmative report because he didn't have that opportunity. For untimeliness alone, Sommer's purported market overview should be excluded under Fed. R. Civ. Proc. 37. For these reasons his inexpertise, his unscientific methods, his failure to consider any case evidence, and the untimeliness of his analysis virtually all of Sommer's testimony should be precluded. A/73465303.3 2 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 II. WHAT DEFENDANTS MUST SHOW TO JUSTIFY SOMMER'S OPINIONS AND WHAT THE COURT MUST DO TO TEST THEM Fed. R. Evid. 702 requires exclusion of expert testimony unless: (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and method reliably to the facts of the case. The party proffering an expert opinion must demonstrate it meets the Rule 702 admissibility standards by a "preponderance of proof." Daubert v. Merrell Dow Pharm. Inc., 509 U.S. 579, 593 (1993); Salinas v. Amteck of Kentucky, Inc., 682 F.Supp.2d 1022, 1029 (N.D. Cal. (PJH) 2010); Perry v. Schwarzenegger, 2010 WL 3025614 at *21 (N.D. Cal.) ("The party proffering the evidence `must explain the expert's methodology and demonstrate in some objectively verifiable way that the expert has both chosen a reliable . . . method and followed it faithfully.'") (quoting Daubert v. Merrell Dow Pharm., 43 F.3d 1311, 1319 n11 (9th Cir 1995) ("Daubert II")). As the court made clear in Carnegie Mellon Univ. v. Hoffman-Laroche, Inc., 55 F.Supp.2d 1024, 103435 (N.D. Cal. 1999): The Ninth Circuit has repeatedly stated that where evidence of pre-litigation research or peer review is not available, the experts must (1) "explain precisely how they went about reaching their conclusion" and (2) "point to some objective source a learned treatise, the policy statement of a professional association, a published article in a reputable science journal or the like to show that they have followed the scientific method as practiced by (at least) a recognized minority of the scientists in their field." [quoting Daubert II, 43 F.3d at 1319]. Absent an explicit finding by the court of admissibility of a challenged opinion, the opinion may not properly be offered at trial. Fed. R. Civ. P. 104(a) (Preliminary questions concerning the qualifications of a person to be a witness . . . shall be determined by the court."); United States v. Jawara, 474 F.3d 565, 583 (9th Cir. 2007) ("failure to make explicit reliability finding was an error"); Mukhtar v. California State University, 299 F.3d 1053, 1066-68 (9th Cir. 2002) (district court prejudicially erred by admitting expert testimony without explicit reliability determination), as amended, 319 F.3d 1073 (9th Cir. 2003); Claar v. Burlington R.R., 29 F.3d 499, 501 (9th Cir. 1994) (courts are both "authorized and obligated to scrutinize carefully the reasoning and methodology underlying" expert testimony). As the Supreme Court has made clear, "the trial judge must ensure that any and all [expert] testimony . . . is not only relevant but reliable." Daubert, 509 U.S. 589, 595. This "gatekeeper" role "entails a preliminary assessment A/73465303.3 3 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of whether the reasoning or methodology underlying the testimony is . . . valid and of whether the reasoning or methodology properly can be applied to the facts in issue." Id. at 592-93. While the Daubert reliability analysis focuses on an expert's methodology, the Supreme Court has also noted that "conclusions and methodology are not entirely different from one another." General Electric Co. v. Joiner, 522 U.S. 136, 146 (1997). Trained experts commonly extrapolate from existing data. But nothing in either Daubert or the Federal Rules of Evidence requires a district court to admit opinion evidence that is connected to existing data only by the ipse dixit of the expert. A court may conclude that there is simply too great an analytical gap between the data and the opinion offered. Id.; accord Heller v. Shaw, 167 F.3d 146, 153 (3d Cir. 1999) ("district court must examine the expert's conclusions in order to determine whether they could reliably follow from the facts known to the expert and the methodology used"). III. LEGAL STANDARDS MANDATING EXCLUSION OF SOMMER'S TESTIMONY A. No Relevant Expertise. Defendants cannot satisfy Rule 702 for opinions that Sommer offers on which he is not an expert in the specific field about which he seeks to testify (e.g., customers' decisions about ERP support, alternate ERP support vendors, ERP "switching programs"). See, e.g., United States v. Chang, 207 F.3d 1169, 1172-73 (9th Cir. 2000) (expert "qualified" in one topic excluded from testifying on topic where didn't have expertise); Salinas, 682 F.Supp.2d at 1030 (rejecting opinions on warnings by proffered expert who "had no professional training or expert qualifications to opine on the formulation or design of warning or safety labels" and had never "investigated a case with similar facts" and never "testified as a warnings expert"); Redfoot v. B. F. Ascher & Company, 2007 WL 1593239 at *10-11 (N.D. Cal. (PJH)) (rejecting testimony on medical subjects and conclusions of what caused victim's autism for which expert had neither training nor qualifications to opine). B. No Expert Analysis. As a corollary, where Sommer's opinions are premised on nothing more than reading information provided by counsel or pulled off the internet (e.g., his purported third party alternatives analysis) they do not assist the trier of fact because they are not premised on any expertise and thus are inadmissible. See, e.g., Perry, 2010 WL 3025614 at *22 ("mere recitation of text in evidence does not assist the court in understanding the evidence A/73465303.3 4 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 because reading, as much as hearing, `is within the ability and experience of the trier of fact.'") (quoting Beech Aircraft Corp v. United States, 51 F.3d 834, 842 (9th Cir. 1995)); Kilgore v. Carson Pirie Holdings, Inc., 2006 WL 3253490 at *4 (6th Cir.) (finding internet article an unreliable basis for methodology where expert did not know what research methodology the article was based and conducted no independent research); Matrix Motor Co. v. Toyota Jidosha Kabushiki Kaisha, 290 F.Supp.2d 1083, 1086 (C.D. Cal. 2003) (expert reports "irrelevant" where they "merely recite hearsay statements, often verbatim, culled from a variety of internet websites"). C. Flawed or No Methodology. Defendants also cannot meet their burden of support for any of Sommer's opinions premised on junk science. Daubert II, 43 F.3d at 1319, n.11 (party must demonstrate in some objectively verifiable way that its expert has chosen a reliable method and followed it properly, particularly where no independent, pre-litigation analysis to rely on); Perry, 2010 WL 3025614 at *21 (same); Salinas, 682 F.Supp.2d at 1029 ("the court must determine whether an expert's testimony reflects "scientific knowledge," whether the findings are "derived by the scientific method," and whether the work product is "good science"- that is, whether the testimony is reliable and trustworthy) (citing Daubert, 509 U.S. at 590 & n.9). Where there is no methodology at all behind an opinion (e.g., Sommer's opinion that customer switching programs are generally ineffectual) the opinion is not admissible. See, e.g., Ahlberg v. Chrysler Corp., 481 F.3d 630, 635-36 (8th Cir. 2007) (affirming exclusion of expert opinion because expert "employed no methodology whatsoever reliable or otherwise"); Diviero v. Uniroyal Goodrich Tire Co., 114 F.3d 851, 853 (9th Cir. 1997) ("Rule 702 demands that expert testimony relate to scientific, technical, or other specialized knowledge, which does not include unsubstantiated speculation and subjective beliefs"). D. Inadequate Factual Support. The proffering party also cannot carry its burden where the expert opinion has no factual basis or ignores undisputed contrary facts (e.g., Sommer's conclusions about multiple alternatives to Oracle support when party and customer evidence is to the contrary, Sommer's condemnation of Safe Passage when analysts and SAP endorsed its goals and likely success). "An opinion based on unsubstantiated and undocumented A/73465303.3 5 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 information is the antithesis of the scientifically reliable expert opinion admissible under Daubert and Rule 702." Cabrera v. Cordis Corp., 134 F.3d 1418, 1423 (9th Cir. 1998); accord, GuidrozBrault v. Mo. Pac. R.R. Co., 254 F.3d 825, 830-31 (9th Cir. 2001) (affirming exclusion of multiple experts because conclusions based on factually unsupported assumptions); Nuveen Quality Income Mun. Fund Inc. v. Prudential Equity Group, LLC, 262 Fed. Appx. 822, 824-25 (9th Cir. 2008) ("An expert opinion is properly excluded where it relies on an assumption that is unsupported by the evidence in the record and is not sufficiently founded upon the facts"); QR Spex, Inc. v. Motorola, 2004 WL 5642907 at *9 (C.D. Cal.) (excluding expert report and opinion where expert didn't review relevant underlying evidence); Robinson v. G.D. Searle & Co., 286 F.Supp.2d 1216, 1221 (N.D. Cal. 2003) (expert's testimony inadmissible when based on factual premise directly contradicted by evidence on the record). IV. SOMMER'S OPINIONS ABOUT HOW ERP CUSTOMERS MAKE DECISIONS ABOUT AFTER-MARKET SUPPORT SHOULD BE EXCLUDED Sommer should be precluded from providing testimony and opinions about what ERP customers generally consider (i.e., their thoughts, intent and motivations) in making after-market support purchasing decisions. Declaration of Lucia MacDonald ("MacDonald Decl."), Ex. A (Sommer Report) at 35-46. He lacks relevant experience qualifying him as an expert on this specific subject. His generalized opinions, which are purportedly based on his "experience," "expertise," and materials found on the internet do not concern or consider the specific customers involved in this case, consider very little of the relevant evidence in this case, and are contradicted by evidence in this case. His testimony is unreliable and misleading and should not be permitted. A. Sommer Lacks Relevant Experience Sommer has never been an expert witness and never qualified as an expert on any subject. MacDonald Decl., Ex. B (Sommer Depo.) at 12:9-23. He has no relevant experience with EAS customers' decisions concerning after-market support for their ERP products either from the perspective of a customer or vendor. Id. at 34:12-16; 36:1-17; 300:6-16 (has never helped a customer with the purchase of after-market support). The only personal experience Sommer cited to support his purported after-market support expertise was (1) that he provided a "tiny bit" of a lecture to some Arizona State graduate students on cost of support (id. at 301:1-12), and (2) that A/73465303.3 6 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 he had some dealings with and interviews of CIOs and other software buyers about the cost of support for products not at issue in this case. Id. at 301:16-302:8; 303:8-20. Though he purports to be an ERP industry expert, Sommer has never worked for SAP, Oracle, PeopleSoft or JDE (id., Ex. B at 13:8-15; 15:5-15), which are not only the ERP vendors whose customers are involved in this case, but are admittedly the very big ERP players. Id. at 244:23-245:5. Moreover, Sommer's experience with other ERP-related vendors did not involve the provision of support for their products. Id. at 17:3-19; 19:18-20:14; 22:4-9; 23:6-24:5; 24:925:1; 26:11-27:4; 68:17-69:7. Sommer's experience is far from sufficient to carry Defendants' burden to show that Sommer is an expert on how ERP customers make post deal support purchasing decisions. See, e.g., Salinas, 682 F.Supp.2d at 1030 (rejecting opinions on warnings by proffered expert who "had no professional training or expert qualifications to opine on the formulation or design of warning or safety labels" and had never "investigated a case with similar facts" and never "testified as a warnings expert"); see also Section III.A above. B. Sommer's Opinions Are Not Based On Sufficient Information And Data Sections VI.D 1-3 of Sommer's Report (MacDonald Decl., Ex. A at 35-41) purport to describe how a customer makes decisions about purchasing support after it has purchased and implemented ERP software, why it will reconsider its support provider, and factors that influence its decision. See also id., Ex. B at 298:5-19. Until the last subsection, 3(d), this portion of Sommer's report cites nothing whatsoever in support of the opinions he expresses, and at his deposition Sommer could not identify any specific evidence to support his opinions. Id. at 298:20-300:5. It is fundamental that "expert testimony [must be] based on sufficient facts and data." FRE 702(1). This testimony is not. "An opinion based on unsubstantiated and undocumented information is the antithesis of the scientifically reliable expert opinion admissible under Daubert and Rule 702." Cabrera, 134 F.3d at 1423; see also Section III.D, above. In the final subsection (titled "The third-party support market may influence a support decision"), Sommer merely cites half a dozen web pages about a few third party support providers' attendance at industry meetings (MacDonald Decl., Ex. A D. (3)(d) at 40-41), but A/73465303.3 7 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 nothing about the influence of any factor on the purchasing decision, which is the subject of the section. Moreover, Sommer did no independent investigation of the third-party materials he relied on to verify whether the facts they recited were accurate. Id., Ex. B at 181:5-14; 182:10-19. Such information is insufficient to support a reliable opinion. See, e.g., Kilgore, 2006 WL 3253490 at *4 (finding internet article an unreliable basis for methodology where the expert did not know what research methodology the article was based and conducted no independent research); see also Section III.B above. C. Sommer's Opinions Neither Consider Nor Concern The Facts Of This Case Sommer testified "my charter for this report was to discuss the general dynamics of what's going on in the marketplace and how these different kinds of software decisions are made by customers." MacDonald Decl., Ex. B at 126:20-127:5. Sommer does not opine about the motivation or behavior of any of SAP TN's 358 specific customers, yet these are the only customers relevant to SAP damages expert, Stephen Clarke's lost profits analysis, which Sommer purportedly supports with these opinions. Id. at 195:14-22; see also Declaration of Holly House in Support of Motion to Exclude Clarke Testimony at Ex. A (Clarke Report) at 217 n. 1036. Sommer testified repeatedly that he did not do any customer-by-customer analysis in this case (MacDonald Decl., Ex. B at 89:11-17; 104:9-17; 191:25-192:8; 193:21-194:1; 200:19-201:2; 230:6-10; 232:2-12; 267:17-268:9; 327:16-23; 336:17-23; 342:6-24) and admittedly has no knowledge what influenced the SAP TN customers' support decisions. Id. at 230:6-10. Thus, as a starting point, Sommer's opinions about the behavior and motivation in general of ERP software customers are inadmissible because they are not relevant to prove the motivations of the specific customers actually involved in this case. See, e.g., Jinro America, Inc. v. Secure Investments, Inc., 266 F.3d 993, 1010-1011 (9th Cir. 2001) (Wallace, J., concurring in result) (generalized expert testimony, not based on personal knowledge of specific party or transaction involved in case, about behavior of Korean businesses is inadmissible because not relevant to prove behavior of the specific Korean business in specific transaction in suit); U.S. v. Walker, 217 Fed.Appx. 714, 716-717 (9th Cir. 2007) (expert's testimony of general account of interrogation practices based on a 10 year old article inadmissible as unreliable and lacking A/73465303.3 8 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 sufficient nexus to case facts); Trout v. Milton S. Hershey Medical Center, 576 F.Supp.2d 673, 678 (M.D. Pa. 2008) (expert's testimony based on generalizations excluded because opinions not applied to the specific case). Even if they were relevant, Sommer's general opinions about ERP customers' support motivations are inadmissible because they are unreliable. Sommer did not consider any customer depositions or declarations or information from this case (see MacDonald Decl., Ex. B at 160:25161:19; see also id., Ex. A at App. C); he did not list as considered and does not rely on the one deposition he attended (id.; see also id., Ex. B at 161:20-162:9); and he does not rely on the one customer interview he did. Id. at 89:18-90:1. When faced with examples from the depositions and declarations of actual SAP TN customers that contradict his opinions about how ERP customers are supposed to think and behave,1 Sommer admitted: "It's interesting information. And were I doing a customer-by-customer review, that would definitely be an interesting document." Id. at 176:9-15. In fact, Sommer considered almost none of the evidence developed in this case. Appendix C to his Report lists all the evidence he considered. MacDonald Decl., Ex. A at App. C; id., Ex. B at 31:14-21; 113:24-114:11. He looked at unidentified parts of only two SAP depositions. Id. at 124:13-24. Apart from glancing at the exhibits to the two depositions, he considered only two Id., Ex. B at, e.g., 170:4-171:6 (TravelCenters testified that it didn't consider any support options other than Oracle or TN); 173:10-16 (Spokane County declared: "There was no other third-party service provider for Spokane's PeopleSoft software that Spokane would have contracted with other than TomorrowNow in June 2007. Spokane also did not have the skills or interest to self-support, and it would never have taken time."); 175:2-176:17 (BrainLab declared: "There was no other third-party service provider for BrainLAB's JDE services that BrainLAB considered for that transition period before its SAP applications were fully functioning other than TN. Had TN not been an available option to BrainLAB for that transitional service on its JDE applications (including because BrainLAB would not have contracted with TN if in fact TN was infringing Oracle-owned intellectual property as alleged by Oracle and BrainLAB knew of such infringement) BrainLAB likely would have continued to contract with Oracle for support services on its JDE applications until its SAP applications were up and running. BrainLAB had not identified or received proposals from any other third-party."); 176:18-178:11 (HarleyDavidson declared: "Harley-Davidson did not have and did not seriously consider any other service options for the PeopleSoft applications Oracle was servicing at that time in 2006 besides Oracle and TomorrowNow. In addition, Harley-Davidson did not seriously consider self-support for its PeopleSoft applications."). A/73465303.3 1 9 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 documents produced in discovery. Id. at 160:11-14. Except in Appendix C, his report cites neither deposition, none of the two depositions' exhibits, and only one of the two documents (on an incidental point). Id., Ex. A at 54 n. 80; see also id., Ex. B at 128:16-129:13. With respect to Meyer's report (to which Sommer purports to respond), though Sommer looked at the report, he did not review any of the source documents or schedules that Meyer cited. Id. at 120:19-121:7; 183:2-184:3. Expert testimony unrelated to the facts of the case, much less contradicted by the evidence that was not considered, is inadmissible. See, e.g., QR Spex, 2004 WL 5642907 at *9 (excluding expert report and opinion where expert didn't review relevant underlying evidence); Robinson., 286 F.Supp.2d at 1221 (expert's testimony inadmissible when based on factual premise directly contradicted by evidence on the record); see also Sections III.C & D above. In sum, Sommer's opinions and testimony about how ERP customers make support decisions should be excluded because he has no relevant expertise on this specific subject and his opinions are not based on sufficient facts and data to be reliable. In addition, they cannot help the trier of fact understand the evidence or determine a fact in issue, because Sommer's opinions did not consider and do not concern the evidence and issues in this case. V. SOMMER'S TESTIMONY RELATED TO ALTERNATIVE THIRD-PARTY SUPPORT OPTIONS SHOULD BE EXCLUDED AS UNRELIABLE AND UNTIMELY AFFIRMATIVE OPINION Section D.4 of Sommer's Report purports to catalog alternate support options to Oracle vendor support. MacDonald Decl., Ex. A at 41-46. Sommer's opinions and testimony about alternative support options should be excluded because (a) Sommer lacks necessary expertise to offer the opinions; (b) the data supporting them is scant and contradicted by evidence Sommer ignored; (c) Sommer's methodology (compiling untested and irrelevant material from the internet) is unreliable; (d) the generalized opinions Sommer offers did not consider and do not concern the facts of this case; and (e) Sommer's analysis does not rebut Meyer but instead is an untimely and prejudicial affirmative analysis. A. Sommer Lacks Relevant Experience As shown in Section IV.A above, Sommer has never assisted any client with the purchase A/73465303.3 10 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of after-market support and has no relevant expertise or real world experience helping customers determine their options, which is the subject of this section. None of his work during the time period relevant to this case (2004-2008) with his company TechVentive was relevant or assisted him. Id., Ex. B at 65:1-5; 73:10-18. Nor did he rely on any publications that he has authored. Id. at 77:10-18. Because he has no specific personal experience to form any of his opinions on thirdparty vendor options in this case, he admittedly did not rely on any. Id. at 77:19-78:2. Having no expertise, Sommer testified he instead relied on random encounters with unnamed third party vendors to validate his conclusions. Id. at 72:10-73:2 ("And I run into these companies frequently at different software events and trade shows and those kind of things . . . . That's how I know this information."); see also id. at 35:2-4. That does not make him an expert. See, e.g., Wallach v. Longevity Network, Ltd., 2006 WL 5106208 at *2 (C.D. Cal.) (expert precluded from testifying about likelihood of confusion and damages in a trademark infringement action because "his experience is limited to the trademark and color scheme of one company in one industry"); see also Section III.A above. Sommer's lack of expertise alone precludes his offering of opinions on third party support alternatives. Fed. R. Evid. 702. B. Sommer's Opinions Are Not Based On Sufficient Information And Data Sommer's menu of purported third party support options is again the regurgitated product of his internet searches. MacDonald Decl., Ex. A at 40-41, nn. 35-59 (cited support in footnotes all from internet searches, including a blog entry); id., Ex. B at 179:23-180:4; 318:2-319:13; 325:12-16. Sommer admittedly did no in-depth analysis of individual vendors. Id. at 319:14-24. He did not know the specifics of any of the alternative support vendors he lists not the products they cover, not the geography they operated in, not whether they were financially stable, and not what they charged. Id. at 215:5-216:15. A particular deficit was his lack of analysis to determine what level of support any third-party support vendor provided during the relevant time, a necessary input in order to evaluate whether such vendor was comparable to SAP TN or Oracle. Id. at 338:22-339:5. In addition, his opinions are not based on any Oracle customer studies about what an Oracle ERP customer would likely care about in an alternate support vendor or actually do in terms of switching. Id. at 322:15-21. A/73465303.3 11 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 A/73465303.3 The Ninth Circuit has repeatedly stated that where evidence of pre-litigation research or peer review is not available, the experts must . . . "point to some objective source a learned treatise, the policy statement of a professional association, a published article in a reputable science journal or the like to show that they have followed the scientific method as practiced by (at least) a recognized minority of the scientists in their field." Carnegie Mellon, 55 F.Supp.2d at 1034-35 (quoting Daubert II, 43 F.3d at 1319). Defendants cannot begin to satisfy this requirement for Sommer's third party vendor analysis. Sommer's lack of rigorous inquiry and lack of relevant factual input makes his study unreliable. It should not be allowed before the jury as "expert" analysis. See Section III.A, B & D above. C. Sommer's Opinions Are Based On An Unreliable Methodology Sommer faults Meyer for assuming that no third party could provide the same level of support as Oracle or SAP TN. MacDonald Decl., Ex. A at 46. However, while Sommer lists some third-party vendors, he is not prepared to opine that they offer comparable or better service than Oracle or SAP TN in the relevant time period. Id., Ex. B at 311:18-312:9. Sommer does not offer any comparison between SAP TN's support offering and that of any purported alternatives. Id. at 98:16-99:4; 216:2-15. He also does not know and did not analyze what level of support the customers at issue in this case would have accepted as compared to SAP TN's service. Id. at 232:4-22. On the defensive, Sommer testified that comparing services between vendors is not as important as what the customers thought of the service but he also did no analysis of the attractiveness of any particular options to the customers in this case. Id. at 99:5-16; 224:1-10. A methodology that presumes third-party service providers to be "alternatives" to SAP TN's without considering how their relevant characteristics compare is fundamentally flawed and unreliable. See, e.g., Daubert II, 43 F.3d at 1319, n.11 (party must demonstrate in some objectively verifiable way that its expert has chosen a reliable method and followed it properly, particularly where no independent, pre-litigation analysis to rely on); see also Section III.C above. D. Sommer's Generalized Opinions Are Not Relevant Because They Neither Concern Nor Consider The Facts Of This Case Sommer's analysis is also untethered to the facts, an independent basis for exclusion. His opinions on EAS support options are high-level generalizations. They are not specific to the time period in this case (MacDonald Decl., Ex. B at 319:25-320:6); they are not specific to the products 12 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 in this case (id. at 320:7-14); they are not specific to vendors supporting the products in this case (id. at 320:15-24); and they are not limited to vendors offering comparable support to SAP TN. Id. at 321:4-19. Sommer did not rely on any of the contemporaneous evidence from those actually in the market, including SAP TN, Oracle, SAP, and customers. Id. at 216:18-217:11; 323:23-325:2. Sommer thus did not know what Oracle, SAP or SAP TN thought of third-party vendors and whether or not they were serious competition. Id. at 315:1-14; 316:8-317:4. And, while he had access to information about the specific customers in this case, Sommer disregarded it.2 As a result, Sommer's generalizations about third-party support have little if anything to do with this case. They cannot help the trier of fact understand the evidence or determine a fact in issue, because Sommer's opinions did not consider and do not concern the evidence and issues in this case. They do not satisfy the relevance requirements for expert testimony and should be excluded. See Section II. D above; see also Jinro, 266 F.3d at 1010-1011 (generalized expert testimony, not based on personal knowledge of specific party or transaction involved in case inadmissible because not relevant to prove behavior of the specific actors in the specific transaction in suit); Perry, 2010 WL 3025614 at *25 (finding unreliable expert opinion that "failed to consider evidence contrary to his view"); Nebraska Plastics, Inc. v. Holland Colors Americas, Inc., 408 F.3d 410, 416 (8th Cir. 2005) (affirming trial court's preclusion of expert's opinions because they did not fit the facts of the case and addressed none of the relevant facts, noting that "if the expert's opinion is so fundamentally unsupported that it can offer no assistance to the jury, it must be excluded (citations omitted) and that "an expert opinion that fails to 2 Sommer's team gathered public material for Clarke about SAP TN's customers in this case "separately" from his work on his report (see MacDonald Decl., Ex. A at 1, n.1), but Sommer did not rely on any of it. Id., Ex. B at 86:4-24; 89:2-8. Similarly, while Sommer interviewed one former SAP TN customer to assist Clarke (see id., Ex. A at 1 n.1), and the customer had not heard of SAP TN (id., Ex. B at 91:19-20), Sommer did not use that information in reaching the conclusions in his report. Id. at 89:18-90:1; 92:5-21. Sommer also did not review any customer deposition transcripts or declarations from this case in forming his opinions, including those that contradict his conclusions about the viability of his listed third party support options. Id at 160:25-161:13; see n. 3 above. And he does not know how many, if any, customers in this case seriously considered any of the alternative support providers he lists. Id. at 314:16-25. A/73465303.3 13 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 consider the relevant facts of the case is fundamentally unsupported" and "should not be admitted if it does not apply to the specific facts of the case."); accord Sunstar, Inc. v. Alberto-Culver Co., Inc., 2004 WL 1899927 at *26-27 (N.D. Ill.); Trout, 576 F.Supp.2d at 678. E. Sommer's Testimony About General Support Options Is Not Rebuttal And Should Be Excluded Pursuant To FRCP 37 Defendants produced Sommer's single-spaced 61-page report on March 26, 2010, the date the parties agreed to provide rebuttal reports. See Oracle's 8/19/2010 Opp. to Defs' Motion in Limine ("MIL") No. 4. Sommer's report purports to respond to opinions or analyses of Oracle damages expert, Paul Meyer, but it clearly contains portions that do not. See MacDonald Decl., Ex. A at 1, 3-4, 9-12, 15-32, 37, 41-61. Specifically, Sommer includes a "general overview of alternatives to Oracle-provided support" that "identified general classes of third-party and self-support options available to customers as a substitute for vendor-provided support." MacDonald Decl., Ex. A at 3, Opinion 2; at 41-46. But Meyer did not offer general opinions on what non-specific EAS customers care about or catalog purported support options generally. Using the evidence in the case, Meyer instead relied on the demonstrated lack of support alternatives comparable to SAP TN's support (which was claimed to be equal to or better than Oracle's) contemporaneously available for Oracle customers who had switched to SAP TN. MacDonald Decl., Ex. C (Meyer Report) at 364, 366, 372. Sommer's general overview, however, describes a different category of support options for ERP customers who are not looking for support comparable to Oracle's and SAP TN's. As he states in the Summary of this section of his Report (MacDonald Decl., Ex. A at 46): [S]ome ERP customers have limited support needs, thus, such a customer may have its support needs met by a company with a limited level of support services. In that situation, a customer has viable alternatives to vendor-provided support, regardless of whether the third party provides the precise level of support services as the customer's ERP vendor. Sommer did nothing to make his "general overview" of options even relevant to, much less rebuttal to, Meyer's case-specific analysis. Id., Ex. B at 98:16-99:4; 311:18-312:9 (Sommer does not opine that any of the third-party vendors he lists offered comparable or better service than Oracle or SAP TN in the relevant period: "that was not part of my assignment"). There is no provision in the case schedule for Meyer to provide a sur-rebuttal report. See A/73465303.3 14 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Oracle's 8/19/2010 Opp. to Defs' MIL No. 4. Defendants' decision to spring on Oracle new nonrebuttal analyses rather than presenting them on November 16, 2009 when affirmative reports were due prejudiced Oracle. Indeed, Defendants are now trying to silence any response to Sommer by Meyer at trial through an in limine motion because Meyer didn't have comprehensive responses to Sommer's Report ready or memorized, although Meyer did testify that he responded to Sommer through Clarke's reference or reliance on Sommer. Id. Defendants have it backwards. It is Sommer who should be silenced, not Meyer. Fed. R. Civ. Proc. 26(a)(2)(C)(ii) allows the admission of rebuttal expert testimony only if it is "intended solely to contradict or rebut evidence on the same subject matter identified by another party. . . ." A rebuttal expert "must restrict his testimony to attacking theories offered by the adversaries' experts." IBM Corp. v. Fasco Industries, Inc., 1995 WL 115421 at *3 (N.D. Cal.); accord In re Ready-Mix Concrete Antitrust Litig., 2009 U.S. Dist. LEXIS 82043 at *19 (S.D. Ill.) (rebuttal report must rebut, not offer affirmative opinions); Burnham v. U.S., 2009 WL 2169191 at *5 (D. Ariz.) ("Rebuttal experts shall be limited to responding to opinions stated by initial experts."). Where, as here, a party mislabels affirmative opinions as "rebuttal" opinions and the opposing party has no meaningful opportunity to respond, the courts can and do preclude those non-rebuttal opinions under Rule 37. The courts in all the above-cited cases did just that. Sommer's "general overview" of alternative support options for ERP customers is not appropriate rebuttal, and it should be excluded for that reason as well. VI. SOMMER'S OPINIONS AND TESTIMONY CONCERNING SELF-SUPPORT AS A "VIBRANT ALTERNATIVE" SHOULD BE EXCLUDED Sommer opines that self-support is a "vibrant alternate support option" that "should have been mentioned" in Meyer's report. MacDonald Decl., Ex. A at 3, item (2); 42-45. Sommer's opinions and testimony about self-support should be excluded because they are unreliable. A. Sommer Lacks Relevant Expertise Once again, Sommer proffers opinions on topics about which he has no expertise. Sommer has never been hired by a client to assist in deciding whether to self-support software. Id., Ex. B at 37:2-16. The only experience with self-support in the after-market for ERP software that Sommer was able to describe in his deposition was limited to a single occasion where a CIO A/73465303.3 15 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of a Midwest manufacturer (he couldn't remember the name of the person or the company) ruminated over whether or not to self-support. Id. at 38:18-39:5. Whatever other qualifications Sommer may have on other topics, his self-support opinions cannot be presented as "expert" to a jury. See, e.g., Chang, 207 F.3d at1172-73 (expert "qualified" in one topic excluded from testifying on topic where didn't have expertise); see also Section III.A above. B. Sommer's Generalized Opinions Are Not Based On Sufficient Information And Are Not Relevant Because They Neither Concern Nor Consider The Facts Of This Case Sommer's opinion that self-support is a "vibrant alternative" is based on virtually no data or support. MacDonald Decl., Ex. A at 42-43. His Report lists a number of attributes that he speculates might make a customer capable of self-support, but cites nothing to support those factors. Id. He does not know whether a large percentage or a small percentage of ERP customers could self-support. Id., Ex. B at 330:3-11. He opined that the only way to determine customers' ability to self-support would be to look at the record on every single customer (id. at 330:21-24), but Sommer, of course, did not do that; he didn't look at any of them. Id. at 217:2-6; 332:8-14; 336:21-23. Sommer also did not consider any of the evidence from Oracle or SAP TN about whether self-support was a realistic alternative for SAP TN's customers. Id. at 216:18217:11; 219:5-13. Thus Sommer has no idea whether or not any of SAP TN's customers fit the profile he outlined for customers capable of self-support. Id. at 328:2-19. Sommer also lacks information to support his characterization of the self-support alternative as "vibrant" even for customers who could do it. He admitted that just being capable of self-support does not necessarily mean that a customer would choose to self-support. Id. at 328:20-329:4. He is ignorant of factors that would influence that choice. Among other things, he does not know whether hiring consultants on his list of alternative support options to assist selfsupport customers would be more or less expensive than using SAP TN for service. Id. at 330:25332:25; 334:17-335:19. And though he opines that software customers could use less automated resources to support their payroll requirements, such as using reference manuals he lists, Sommer also does not know whether any SAP TN customer fits the profile to do that. Id. at 335:20-337:8. In short, Sommer's opinion that self-support is a "vibrant alternative" for ERP customers A/73465303.3 16 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 is unreliable ipse dixit speculation by someone who has no experience with self-support. Moreover, it does not take into account any information about the SAP TN customers in this case, or specifically apply to them. Sommer's opinion is not based on sufficient data, it is irrelevant because it is not applied to the facts of this case and it is not the result of rigorous analysis. It should be excluded. See Sections II, III A, C & D above. VII. SOMMER'S OPINIONS AND TESTIMONY REGARDING THE GENERAL EFFECTIVENESS OF SWITCHING PROGRAMS SHOULD BE EXCLUDED In his report, Sommer offers the opinion that marketing programs designed to entice customers to switch from another ERP vendor's products are not unusual in the ERP industry but "rarely produce the kinds of major changes vendors hope to achieve." MacDonald Decl., Ex. A at 48; see also id. at 3, item(3); 47-49; 50-52. His opinions and testimony about the general success of ERP switching programs should be excluded. A. Sommer Lacks Relevant Qualifications Sommer cites no personal experience with or knowledge of ERP vendors switching programs that would qualify him to express an expert opinion about whether they are successful. Sommer has never assisted a client in developing a market program akin to SAP's Safe Passage switching program and none of his work had anything to do with evaluating the success or failure of any ERP vendor's marketing programs. Id., Ex. B at 62:17-63:4; 64:18-65:1. An unqualified expert cannot testify. See, e.g., Rambus, Inc. v. Hynix Semiconductor, Inc., 254 F.R.D. 597, 60305 (N.D. Cal. 2008) (finding inadmissible testimony of electrical engineer on "commercial success" because he had no marketing or business training in commercial aspects of claimed invention); see also Section III.A above. B. Sommer's Opinion Is Not Based On A Reliable Methodology Applied To Sufficient Data Sommer cited seven examples of switching programs in his Report. MacDonald Decl., Ex. A at 48-49. Four have nothing to do with the products or customers in this case. Id., Ex. B at 238:21-239:15. For the other three, Sommer based his opinion on information he got off the internet. Id., Ex. A at 48-49 nn. 63-70; id., Ex. B at 239:16-21. But none of the internet sources Sommer cites details the success of any of the seven programs; he admitted he has no metrics whatsoever on the actual success or failure of any ERP vendors' switching program. Id. at A/73465303.3 17 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 241:14-242:25 ("Q. Now, you've provided no materials from which one could gauge [any of ] the program[s'] success, correct?" "A. That is correct. I did not provide that detail." "Q. Do you have it? A. No. That was not part of the scope of my assignment."). Literally the only support for Sommer's opinion is a comment he found in an internet article interview with an analyst, Jim Shepherd, that switching programs generally have "limited success." Id., Ex. A at 48 & n. 63; id., Ex. B at 73:19-74:13; 242:11-243:23.3 But Sommer did not interview the authors of any of the articles he considered in forming his opinions and did no independent investigation to verify whether the facts recited were accurate. Id. at 179:23-181:14; 182:10-19. This is not acceptably rigorous and "expert" analysis or reliable expert support. See, e.g., Ollier v. Sweetwater Union High School Dist., 267 F.R.D. 339, 341-42 (S.D. Cal. 2010) (excluding expert testimony for lacking a reliable methodology applying to the facts of the case); see also Section III.B above. Because Sommer provides no information and uses no metric for gauging the success of these programs, his methodology for concluding that switching programs are generally unsuccessful cannot be tested. It is mere ipse dixit, and it should be excluded as unreliable. Joiner, 522 U.S. at 146; see also Section III.C above. C. Sommer's General Opinions Of Switching Programs Do Not Consider And Are Not Relevant To The Facts Of This Case Sommer never spoke with anyone at SAP or SAP TN about this case in preparing his opinions. MacDonald Decl., Ex. B at 82:17-21. His opinion that most marketing programs by either Oracle or SAP have had limited impact on their customers is based solely on his experience as "an industry watcher" and he has no data or analysis of any of the marketing programs of either Oracle or SAP to support this statement. Id. at 344:6-346:19. Safe Passage, the particular program relevant in this case, differed in significant respects from the other switching programs Sommer mentions; in particular Safe Passage alone featured an Ironically, contrary to Sommer's newly hatched opinion that SAP's Safe Passage expectations were unreasonable discussed below, Mr. Shepherd praised SAP's Safe Passage switching program as "great strategy." MacDonald Decl., Ex. B at 249:2-250:9; id., Ex. E (Sommer Depo. Exhibit 595). A/73465303.3 3 18 Case No. 07-CV-01658 PJH (EDL) ORACLE MOT. NO. 2: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT BRIAN SOMMER 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 established support alternative (SAP TN), subsidized by a venerable ERP parent (SAP) as an enticement. Id. at 346:20-347:12; 352:3-11; id., Ex. A at 48-50. Thus whatever the merits of other switching programs, and even if Sommer had any acceptable expertise or basis for opining about them (which he doesn't), his opinion should be excluded because it is irrelevant to the only switching program at issue here (Safe Passage). See, e.g., Jinro, 266 F.3d at 1010-1011; Nebraska Plastics, Inc., 408 F.3d at 416 (affirming preclusion of expert opinion that did not apply to specific case facts); Trout v. Milton S. Hershey Medical Center, 576 F.Supp.2d at 678 (expert's testimony based on generalizations excluded because opinions not applied to specific case facts). VIII. SOMMER'S OPINIONS REGARDING THE EFFECTIVENESS OF SAP'S SAFE PASSAGE PROGRAM AND THE REASONABLENESS OF SAP'S EXPECTATIONS ABOUT IT SHOULD BE EXCLUDED Sommer

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