Oracle Corporation et al v. SAP AG et al

Filing 771

MOTION No. 5: To Exclude Testimony of Defendants' Expert Stephen Gray 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. (Attachments: # 1 Proposed Order)(Howard, Geoffrey) (Filed on 8/19/2010)

Download PDF
Oracle Corporation et al v. SAP AG et al Doc. 771 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 209009) BREE HANN (SBN 215695) donn.pickett@bingham.com geoff.howard@bingham.com holly.house@bingham.com zachary.alinder@bingham.com bree.hann@bingham.com Three Embarcadero Center San Francisco, CA 94111-4067 Telephone: 415.393.2000 Facsimile: 415.393.2286 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. Plaintiff, No. 07-CV-01658 PJH (EDL) NOTICE OF MOTION AND MOTION NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY Date: Time: Place: Judge: September 30, 2010 9:00 a.m. 3rd Floor, Courtroom 3 Hon. Phyllis J. Hamilton Case No. 07-CV-01658 PJH (EDL) SAP AG, et al., Defendants. NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 VI. VII. IV. V. I. II. III. TABLE OF CONTENTS Page SUMMARY OF INADMISSABLE OPINIONS AND RELIEF REQUESTED .............. 1 WHAT DEFENDANTS MUST SHOW TO JUSTIFY GRAY'S OPINIONS AND WHAT THE COURT MUST DO TO TEST THEM............................................... 3 THE COURT SHOULD EXCLUDE EVIDENCE OF "NON-ACCUSED CONDUCT"....................................................................................................................... 5 A. Appendix 4 Is Based On Unreliable Data and Methods, And Not A Proper Subject of Expert Testimony.................................................................................. 5 1. Gray's Lack of Expert Analysis Renders Appendix 4 Improper ............... 6 2. Gray's Failure To Consider Available Evidence Renders Appendix 4 Improper.................................................................................................. 8 3. The Majority of Appendix 4 Does Not Deal With Expert, Scientific or Specialized Knowledge ......................................................... 9 B. Appendix 4 Would Cause Prejudice, Confusion and Take Undue Time To Explain ................................................................................................................. 11 C. Appendix 4 is Not Proper Rebuttal ...................................................................... 12 THE COURT SHOULD EXCLUDE GRAY'S TESTIMONY CONCERNING OPINIONS MANDIA DID NOT OFFER AND ANALYSES MANDIA DID NOT DO........................................................................................................................... 12 THE COURT SHOULD EXCLUDE ANY TESTIMONY ABOUT CONTRACTS OR INDUSTRY STANDARD PRACTICES......................................... 15 A. Gray Is Not An Expert in Software Licenses, Website Terms of Use, Or Industry Practices ................................................................................................. 15 B. Specifically, The Court Should Preclude Any Testimony Suggesting That SAP TN Or Its Customers May Have Been Entitled To Oracle Software And Support Materials Without Regard To Their Source ................................... 17 C. The Court Should Also Preclude Testimony That SAP TN Properly Accessed Oracle Software And Support Materials As Its Customers' Agent .................................................................................................................... 18 THE COURT SHOULD PRECLUDE MR. GRAY'S TESTIMONY BECAUSE HE FAILED TO DISCLOSE MATERIALS HE RELIED ON OR CONSIDERED ................................................................................................................ 18 CONCLUSION ................................................................................................................ 20 i Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 American Booksellers Ass'n v. Barnes & Noble, Inc., 135 F. Supp. 2d 1031 (N.D. Cal. 2001) ................................................................................. 15 Burnham v. U.S., 2009 WL 2169191 (D.Ariz.).................................................................................................. 12 Carnegie Mellon Univ. v. Hoffman-Laroche, Inc., 55 F. Supp. 2d 1024 (N.D. Cal. 1999) ..................................................................................... 4 Claar v. Burlington R.R., 29 F.3d 499 (9th Cir. 1994).................................................................................................. 4, 9 Crow Tribe of Indians v. Racicot, 87 F.3d 1039 (9th Cir. 1996).................................................................................................. 14 Daubert v. Merrell Dow Pharm. Inc., 509 U.S. 579 (1993) ........................................................................................................ passim Diviero v. Uniroyal Goodrich Tire Co., 114 F.3d 851 (9th Cir. 1997).................................................................................................... 7 Ellis v. Costco Wholesale Corp., 240 F.R.D. 627 (N.D. Cal. 2007) ........................................................................................... 16 General Electric Co. v. Joiner, 522 U.S. 136 (1997) ................................................................................................................. 5 Heller v. Shaw, 167 F.3d 146 (3d Cir. 1999)..................................................................................................... 5 i4i Ltd. P'ship v. Microsoft, 670 F. Supp. 2d 568 (E.D. Tex. 2009), aff'd on reh'g, 598 F.3d 831 (Fed. Cir. 2010) ....................................................................... 14 IBM Corp. v. Fasco Industries, Inc., 1995 WL 115421 (N.D. Cal.)................................................................................................. 12 In re Ready-Mixed Concrete Antitrust Litig., 261 F.R.D. 154 (S.D. Ill. 2009).............................................................................................. 12 Mukhtar v. California State University, 299 F.3d 1053 (9th Cir. 2002), as amended, 319 F.3rd 1073 (9th Cir. 2003) ........................................................................... 4 ii Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 TABLE OF AUTHORITIES (continued) Page Nationwide Transp. Fin. v. Cass Info. Sys., Inc., 523 F.3d 1051 (9th Cir. 2008)................................................................................................ 14 Perry v. Schwarzenegger, 2010 WL 3025614 (N.D. Cal.)........................................................................................... 4, 13 Salinas v. Amteck of Kentucky, Inc., 682 F. Supp. 2d 1022 (N.D. Cal. 2010) ............................................................................... 4, 7 United States v. Conn, 297 F.3d 548 (7th Cir. 2002).................................................................................................. 10 United States v. Jawara, 474 F.3d 565 (9th Cir. 2007).................................................................................................... 4 United States v. San Diego Gas & Elec. Co., 2009 WL 4824489 (S.D. Cal.) ............................................................................................... 11 RULES Fed. R. Civ. P. 26 ......................................................................................................... 3, 12, 14, 20 Fed. R. Civ. P. 37 ......................................................................................................... 3, 16, 18, 20 Fed. R. Evid. 104 ........................................................................................................................... 4 Fed. R. Evid. 403 ............................................................................................................. 11, 15, 18 Fed. R. Evid. 702 .................................................................................................................. passim Fed. R. Evid. 703 ......................................................................................................................... 15 iii Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 1 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") shall and hereby do move for an order excluding opinions and testimony of Stephen Gray ("Gray") 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 Gray's proposed expert opinion testimony is inadmissible on the basis of the authorities and evidence set forth herein and in the accompanying declarations. I. SUMMARY OF INADMISSABLE OPINIONS AND RELIEF REQUESTED Defendants designated Stephen Gray as a rebuttal expert to Oracle's expert witnesses Kevin Mandia, Daniel S. Levy, Paul Meyer, and Paul Pinto on January 22, 2010. Gray provided the first version of his 80-page expert report on March 26, 2010, the date the parties agreed to provide rebuttal reports. Declaration of John A. Polito ("Polito Decl.) 3. He produced an updated version of his expert report on June 3, 2010. Id. His report and testimony principally address Mandia's report, with a few pages directed to the portion of Meyer's damages report that concerns Defendants' illegal use of Oracle database software. Polito Decl., Ex. A ("Gray Report") 10.6.5-10.6.7.1.1 Mandia is a highly regarded expert in computer forensics who performed extensive investigation and forensic analysis of the means and methods by which SAP TN accessed and downloaded from Oracle's websites, and the nature and extent of SAP TN's copying, modification, distribution and use of Oracle's intellectual property to support its customers. Id., Ex. C ("Mandia Report") at 2. Mandia identified several categories of SAP TN's conduct that Oracle contends were wrongful, including but not limited to mass downloading of Oracle Software and Support Materials (SSMs), improper access to Oracle's systems, making thousands Gray does not address Pinto's testimony at all, and does not criticize Levy's report other than noting its interdependence with Mandia's testimony. 1 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 unauthorized copies of Oracle enterprise application and database software, and using the downloaded materials and copies of software in ways prohibited by licenses and terms of use to support its customers. Id. at 16. Gray's proposed testimony is deficient in four respects. First, although Defendants did not disclose Gray as an affirmative expert, he nonetheless purports to submit a long list of customers for which SAP TN supposedly did not wrongfully take and use Oracle's intellectual property. The basis for this testimony is Appendix 4 to his report, one of only three trial exhibits for which he is the designated sponsor. However, Appendix 4 suffers from multiple problems, including that it does not rebut or contradict Mandia's analysis and is therefore not proper rebuttal. Gray would not vouch for Appendix 4 as a reliable summary, stressing the limited information on which he based it (it includes sections prepared by Defendants' attorneys or with information supplied only by them). Its minimal or nonexistent probative value is far outweighed by the danger of confusing the issues and misleading the jury, and the undue trial time it, and Oracle's responses to it, would consume. Gray further disclaimed any actual opinion regarding the propriety of SAP TN's conduct or business model, thus further limiting the possible value of Appendix 4 to the jury. Second, Gray also reports repetitively and at length that Mandia did not undertake analysis or provide opinions on various subjects. The most repeated observations concern a litany of particular items on which Mandia did no analysis of protected expression under copyright law. Because Mandia did not express opinions on these ultimate issues because he was not asked to, Gray's testimony listing Mandia's supposed omissions does not contradict or rebut the work Mandia did or the opinions he offered, and it is not proper expert rebuttal. In fact, it is not expert testimony at all, but legal argument as to which Gray himself admittedly has no expertise. Indeed, while criticizing Mandia's assumptions as to issues such as whether SAP TN's activities infringed "protected expression," Gray himself admitted in his deposition that he himself has no definition of "protected expression" and has merely relied on lawyers for guidance as to how to define it. His critique of Mandia's assumptions should not be permitted. Third, the Court should exclude Gray's testimony interpreting software licenses and 2 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 website terms of use, or opining on the propriety of conduct under their terms. He is, by his own admission, not an expert on such subjects and not competent to testify about them. In particular, Gray should not be permitted to suggest, as he does in his report, that SAP TN's customers may have been "entitled" to Oracle software or support materials without regard to their source, or that SAP TN's conduct was permitted because SAP TN was its customers' agent. These are legal questions Mr. Gray is not qualified to answer. Fourth, the Court should exclude Gray's testimony and exhibits in their entirety pursuant to Fed. R. Civ. P. 37(c) because of Defendants' failure to make meaningful disclosure, as required by Fed. R. Civ. P. 26(a)(2)(B)(ii), of materials that Gray considered in forming his opinions. Gray's testimony makes clear that the eight-page single-spaced listing Defendants provided to Oracle was a list of materials Gray received from counsel. It contains substantially more than the materials he considered. The documents Gray considered in forming his opinions are buried somewhere in that voluminous information, and it is not possible to reconstruct which ones they are. As a result, Oracle cannot test Gray's opinions as it is entitled to do. Oracle cannot show that Gray ignored important evidence when he formed an opinion because there is no way to know what he considered or ignored. Oracle cannot cross-examine Gray at trial with the particular logs and code versions he relied on to show the jury that his opinions lack merit, because there is no record of what he considered, and Gray himself did not remember at his deposition. Defendants' violation of Fed. R. Civ. P. 26(a)(2)(B)(ii) hinders meaningful crossexamination at trial and warrants exclusion under Rule 37. Accordingly, the Court should exclude Gray's testimony and exhibits in their entirety under Rule 37. Alternatively, the Court should exclude: (i) Gray's Appendix 4 and all testimony that refers to it; (ii) Gray's testimony stating that Mandia did not take certain steps or render certain opinions in his analysis, and (iii) Gray's testimony interpreting licenses and terms of use, or opining on the propriety of conduct under their terms. II. WHAT DEFENDANTS MUST SHOW TO JUSTIFY GRAY'S OPINIONS AND WHAT THE COURT MUST DO TO TEST THEM Fed. R. Evid. 702 requires exclusion of expert testimony unless: 3 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 (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. 2010) (Hamilton, J.,); Perry v. Schwarzenegger, 2010 WL 3025614, *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 n.11 (9th Cir 1995) ("Daubert II")). As the court made clear in Carnegie Mellon Univ. v. Hoffman-Laroche, Inc., 55 F. Supp. 2d 1024, 1034 (N.D. Cal. 1999): The Ninth Circuit has repeatedly stated that where evidence of prelitigation 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. Evid. 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 an explicit reliability finding was 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.3rd 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. at 589. This "gatekeeper" role "entails a preliminary 4 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 assessment 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 59293. 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. THE COURT SHOULD EXCLUDE EVIDENCE OF "NON-ACCUSED CONDUCT" A. Appendix 4 Is Based On Unreliable Data and Methods, And Not A Proper Subject of Expert Testimony Appendix 4 to the Gray Report ("Appendix 4") is a spreadsheet entitled "Non-Accused Conduct." Polito Decl., Ex. E. The first two tabs of this spreadsheet purport to enumerate 51 SAP TN customers "to which the accusations that are identified in the Mandiant report do not apply." Id., Ex. B (Gray Depo.) at 551:12-15. Phrased slightly differently, the spreadsheet purports to identify "TomorrowNow customers for which product support was provided which did not fall within the Mandiant rules, for lack of a better term," id. at 260:10-19, where "the Mandiant rules" refers to "the accusations that the Mandiant report makes regarding TomorrowNow's behavior." Id. at 261:24-262:7. In assembling Appendix 4, Gray (and the six attorneys from Jones Day who assisted him 5 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 writing his report) ignored relevant facts, and did not perform a reliable investigation.2 Furthermore, most of Appendix 4 required no expert, scientific or specialized knowledge because it is primarily a cross-tabulation of data reported by Mandia. Yet, Appendix 4 nonetheless forms the basis for all of Gray's opinions about SAP TN's supposedly proper business model. Indeed, Appendix 4 is one of only three exhibits on Defendants' list for which Gray is listed as the sponsoring witness. Dkt. 733 (Defs' Trial Ex. List) at 60. For the reasons explained below, the Court should exclude Appendix 4 in its entirety, and should similarly exclude any derivative testimony or exhibits.3 1. Gray's Lack of Expert Analysis Renders Appendix 4 Improper The title of Appendix 4, "Non-Accused Conduct," is a misnomer. Gray analyzed the contents of Mandia's report, not SAP TN's conduct: Q. To be clear, your list of 51 customers is not intended to be a summary of all available evidence relating to TomorrowNow's support of its customers? [Objection omitted] A. I didn't look for evidence outside the Mandiant report's identification of improper conduct. I didn't look outside that. My assignment was to analyze the Mandiant report and offer comments relative to the Mandiant report. So I didn't -- I didn't try to do what -- I mean, I didn't try to do that other thing that -you know, the other job. Polito Decl., Ex. B (Gray Depo.) at 285:16-286:3 (emphasis supplied); see also id. at 261:19-23 (confirming that "the universe of information that [Gray] looked at was the information described in Mr. Mandia's report"); id. at 259:19-25 (defining the list of 51 customers in terms of 2 See, e.g., Polito Decl., Ex. B (Gray Depo.) at 321:5-322:2, 326:15-22, 490:22-493:8 (discussing the contributions of Briana Bassler, Scott Cowan, Josh Fuchs, Sean McCarthy, Nicole Perry and Laurens Wilkes to Mr. Gray's report); id. at 11:19-25; 321:5-322:2; 331:25-332:7 (testifying that these six individuals were attorneys employed by Jones Day). 3 Derivative testimony and exhibits include, but are not limited to, Polito Decl., Ex. A (Gray Report) 13.2, which largely duplicates the second tab of Appendix 4, and any other portion of the Gray Report that expressly refers to Appendix 4, 13.2, "non-accused conduct" or "nonaccused customers." 6 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 "the conduct . . . [described] in the Mandiant report"). Gray testified that he "was not . . . asked to analyze" data other than Mandia's report. Id. at 261:10-18. In fact, Gray has no opinion about TomorrowNow's conduct: Q. Do you presently have an opinion that any conduct by TomorrowNow was proper or improper? [Objection omitted] A. . . . I don't have an opinion -- you're asking me the opinion -- the way you asked that question is very difficult to answer. I don't have an opinion -- I don't have an opinion regarding the proprietor -- propriety or impropriety or permissibility in a general sense of how TomorrowNow conducted their affairs with their customers or conducted their business with their customers. I don't have an opinion about the general -- the broader question. My opinions are confined to the Mandiant report and appendices and work that he did and comments and critiques of his report, is really what my opinions in my report pertain to. . . Id. at 443:9- 444:8 (emphasis supplied). Because Gray testified at deposition that he was neither instructed to perform nor did perform any independent analysis of SAP TN's business model in assembling Appendix 4, he may not use Appendix 4 to testify that SAP TN's business model was appropriate; such testimony should be excluded as unreliable speculation. See 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.") (citation omitted); cf. Salinas v. Amteck of Kentucky, Inc., 682 F. Supp. 2d 1022, 1031 (N.D. Cal. 2010) (noting, in excluding under Daubert expert testimony that a warning was defective, that the expert had previously "testified that he ha[d] no criticism of the warning").4 Moreover, because Appendix 4 has no purpose or relevance other 4 For the same reasons, the Court should exclude those sections of Gray's report opining on the propriety of SAP TN's business model. See, e.g., Polito Decl., Ex. A (Gray Report) 8.2.1 (suggesting that aspects of SAP TN's support of retrofit customers was appropriate and "Oracleapproved"); id. 8.4 (same); id. 8.3 (suggesting that SAP TN may have been permitted to use software "regardless of the source" to support its customers). Gray expressly disclaimed any such opinions at deposition. See, e.g., id., Ex. B (Gray Depo.) at 441:9-12 ("I'm not intending in (Footnote Continued on Next Page.) 7 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 than suggesting that SAP TN's conduct was proper for the "Non-Accused Conduct" when that is the very determination that Gray admits he did not actually make the Appendix should be excluded entirely. 2. Gray's Failure To Consider Available Evidence Renders Appendix 4 Improper The second tab of Appendix 4 is labeled "51 Non-Accused Customers." As discussed above, Gray specifically declined to state an opinion regarding the propriety of SAP TN's support model. He was accordingly unwilling to express an opinion that, for the 51 customers listed in his Appendix 4 as "not implicated by the accused conduct," SAP TN in fact provided support to them properly or correctly: Q. Do you intend to testify in trial that the list of 51 customers represents a list of 51 customers for whom TomorrowNow provided support properly and correctly? [Objection omitted] A: I don't think I, sitting here today, prepared to offer an -that I'd necessarily offer an opinion that states that the 51 were or were not -- that either the 51 were or -- the 51 were customers for which there was not improper activity. What I am talking about is improper activity which Mandiant defines. I didn't look at that other -- I didn't make a determination with regard to the other, so I don't think I can testify about it. Polito Decl., Ex B (Gray Depo.) at 287:4-22. Gray would not vouchsafe that for those 51 customers characterized in his Appendix 4 as not implicated by the accused conduct, SAP TN in fact had provided support to them in a proper manner. When asked whether "the presence or absence of a customer on [his] list of 51" could support "an assertion that a customer was -- was or was not supported in an infringing or an improper manner," Gray replied: "Well, once again, I haven't done that work. . . . So it's hard for me to make a declarative statement about that. I (Footnote Continued from Previous Page.) my report to try and talk about the general case of how TomorrowNow dealt with their customers or the propriety or impropriety of their behaviors."). 8 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 know -- I don't feel comfortable answering it. I just don't know." Id. at 286:11-287:3. Evidence not considered by Gray indicates that SAP TN did support those 51 customers improperly. Compare, e.g., id., Ex. E (Appendix 4) (listing US Oncology and BBS Electronics as "non-accused customers") with id., Ex. F (Baugh Depo.) at 140:17-141:3 (admitting that Baugh, an SAP TN employee, had used the software of customer Norwegian Cruise Lines when testing an upgrade for US Oncology) and id., Ex. B (Gray Depo.) at 274:24-275:18 (acknowledging that Plaintiffs' Deposition Exhibit 3120, regarding a support case for BBS Electronics, discussed a simulated test in customer Praxair's environment). Regardless, Gray testified that it "wouldn't be necessarily appropriate" to remove a customer from Appendix 4's list of 51 "non-accused" customers, even if it were demonstrated that SAP TN had improperly supported a customer on the list. See id. at 284:7-24. According to Gray, the data summarized in Appendix 4 is and will continue to be limited to Gray's reading of Mandia's report, to the exclusion of any other evidence in the record. See id. Thus, Appendix 4 and Gray's opinions derived from it are neither based on sufficient facts and data nor the results of reliable application of principles and methods to the record in the case. See, e.g., Claar, 29 F.3d at 501-03. In short, Gray's opinion does not "fit" the facts, Daubert, 509 U.S. at 595, and should be excluded. 3. The Majority of Appendix 4 Does Not Deal With Expert, Scientific or Specialized Knowledge To create Appendix 4, Gray and the attorneys who worked at his direction did nothing more than assemble lists of the customer names in Mandia's report, the customer names listed in various documents, depositions and discovery materials that Mandia cited, and the customer names found in directories on SAP TN's computers. See Polito Decl., Ex. G (Appendix 5 to Gray Report) (listing the materials reviewed in constructing Appendix 4). Only the last of these, requiring the review of directories on SAP TN's computers, plausibly requires expert, scientific or specialized knowledge. Simply taking customer names from Mandia's tables and spreadsheets (or from spreadsheets created by Defendants in the course of discovery) and copying them into various columns is a ministerial task that does not rise to the level of expert 9 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 opinion. See Fed. R. Evid. 702 (requiring that "scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue" as a predicate to expert testimony). As further evidence that no scientific, technical or other specialized knowledge was required, Gray testified that Jones Day attorneys, instead of or in addition to Gray, populated certain columns on Appendix 4. See, e.g., Polito Decl., Ex. B (Gray Depo.) at 324:19-325:10 (testifying that Appendix 4 was "jointly developed," with Gray "asking for certain columns and certain analyses to be performed"); id. at 326:6-22 ("Q. To be clear, you asked [Jones Day attorney] Mr. Fuchs to create certain columns and to perform certain analyses for your Appendix 4? A. Well, that's where it started, and then there was a collaborative effort that went back and forth . . . ."). Gray identified five columns as jointly populated by Gray and Jones Day attorneys. See id. at 330:1-332:7 (Gray and Jones Day attorneys Bassler and McCarthy populated the "PeopleSoft Customer" column); id. at 344:25-345:9 (same); id. at 345:25-346:24 (same, for the "JDE World Customer," "JDE OneWorld Customer" and "Siebel Customer" columns). Jones Day attorneys populated one column entirely. Id. at 327:8-23 (someone other than Gray populated the Customer column and related footnotes); id. at 593:18-20 (no one else from Gray & Yorg worked on the matter). Twelve of the eighteen remaining substantive columns consist of nothing more than tabulated lists of customer names found in deposition testimony, spreadsheets, or tables in Mandia's report. See Polito Decl., Ex. G (Appendix 5 to Gray Report) 3.1, 4.6, 4.7, 4.8, (stating that four of the remaining columns are lists of customer names from identified portions of depositions and related exhibits); id. 4.1, 4.3, 4.4, 4.5, 5.1 & n.37, 5.2 & n.38, 5.3 & n.39 (stating that seven of the remaining columns are lists of customer names (or customer codes converted to customer names) taken from spreadsheets produced by Mandia or by Defendants); id. 5.5 (stating that one of the remaining columns is a list of customer names from a table in Mandia's report). Thus, at least 75% of this chart is a re-listing of pre-existing lists, rather than the result of any expert analysis. This type of material is not properly admitted under Fed. R. Evid. 702. See, e.g., United States v. Conn, 297 F.3d 548, 554 (7th Cir. 2002) (distinguishing expert testimony 10 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 from lay testimony on grounds that the former "provide[s] specialized explanations or interpretations that an untrained layman could not make if perceiving the same acts or events") (citation omitted). B. Appendix 4 Would Cause Prejudice, Confusion and Take Undue Time To Explain Even relevant evidence should be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence. Fed. R. Evid. 403. In particular, because, expert testimony "can be both powerful and quite misleading because of the difficulty in evaluating it" courts exclude otherwise relevant expert testimony "`if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury.'" Daubert, 509 U.S. 589, 595 (quoting Jack Weinstein, Rule 702 of the Federal Rules of Evidence is Sound; It Should Not Be Amended, 138 F.R.D. 631, 632 (1991)). The Court should exclude Mr. Gray's "non-accused conduct" exhibit and testimony under these standards. Appendix 4 has limited probative value to begin with. Even if it were reliable, a tabulation of customers supposedly not the subject of Oracle's contentions of wrongdoing does not negate Defendants' liability for those that are. It is simply an exercise in misdirection, and likely (in fact designed) to lead to confusion of the issues and mislead the jury. Fed. R. Evid. 403. Moreover, because Gray's analysis is both complicated and flawed, the required explanation, cross-examination, rebuttal and arguments relating to it would consume an undue amount of the very limited trial time available. "Explaining this complex and convoluted thicket to a trier of fact clearly invites undue prejudice and confusion of issues, in addition to a very real possibility that the jury will be misled." United States v. San Diego Gas & Elec. Co., 2009 WL 4824489, at *14 (S.D. Cal.). Because these considerations far outweigh any probative value Gray's exhibit and testimony might have, the exhibit and testimony should be excluded. Fed. R. Evid. 403. 11 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 C. Appendix 4 is Not Proper Rebuttal Gray admitted that he did not intend Appendix 4 to rebut or contradict Mandia's analysis: Q. So would you agree that Appendix 4 provides context, but does not contradict or rebut the conclusions in Mr. Mandia's report? [Objection omitted A. I don't think the purpose or intent of Exhibit 4 is to contradict or rebut. It is rather to provide some insights in -- I think I'd use that word -- provide insights into the conclusions that he has. Again, with respect to Section X of the Mandiant report, again, as I say, there are ... some things that can be read as broad assertions here, or broad opinions, and to that extent, it might limit some of that. But there's nothing specific other than that that I can think of. And as a matter of fact, it is intended to try and provide insights and adopt what the Mandiant report reported. Polito Decl., Ex. B (Gray Depo.) at 558:6-24 (emphasis supplied). If Defendants wished to offer a technical expert's opinions about customers to which Oracle's claims of wrongdoing do not apply, they should have offered it in an initial expert report. Fed. R. Civ. Proc. 26(a)(2)(C)(ii) allows the admission of rebuttal testimony "solely to contradict or rebut evidence on the same subject matter identified by another party. . . ." It does not permit as "rebuttal" expert testimony affirmative matter that does not respond to evidence offered by the other party. A rebuttal expert "must restrict [his] testimony to attacking theories offered by the adversary's experts." IBM Corp. v. Fasco Industries, Inc., 1995 WL 115421, at *3 (N.D. Cal.) (granting in part motion to exclude "rebuttal" opinions); accord In re ReadyMixed Concrete Antitrust Litig., 261 F.R.D. 154, 159 (S.D. Ill. 2009) (rebuttal report must rebut, not offer affirmative opinions); Burnham v. U.S., 2009 WL 2169191, at *5 (D.Ariz.) ("[R]ebuttal experts shall be limited to responding to opinions stated by initial experts."). The Court should exclude Gray's Appendix 4 and his testimony that refers to it because they are not proper rebuttal expert testimony. IV. THE COURT SHOULD EXCLUDE GRAY'S TESTIMONY CONCERNING OPINIONS MANDIA DID NOT OFFER AND ANALYSES MANDIA DID NOT DO A large part of Gray's report, perhaps most of it, consists of repetitive assertions that Mandia did not undertake certain analyses or express certain opinions in his report. E.g., Polito 12 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 Decl., Ex. A (Gray Report), 6.4.1 (no analysis of protected expression); id. 6.4.2 (no analysis of licenses); id. 7.5.1 (no analysis of protected expression); id. 7.5.4.1 (no analysis of protected expression in downloads); id. 7.5.4.2 (no analysis of protected expression in backups); id. 7.5.4.3 (no analysis of protected expression in One World copies); id. 7.5.4.4 (no analysis of protected expression in World copies); id. 7.5.4.5 (no analysis of protected expression in Oracle databases); id. 7.5.4.6 (no analysis of protected expression in fixes); id. 7.6 (no analysis of protected expression in cross-used environments); id. 7.7 (no review of terms of use); id. 7.8 (no sources of definitions used); id. 8.1.3 (no copyright analysis); id. 8.2 (little analysis of software lines and models other than PeopleSoft); id. 8.2.2 (no discussion of call support); id. 8.2.3 and its subsections (little or no analysis of various product lines and versions); id. 8.2.4 and its subsections (little analysis of JDE customers and services); id. 8.5 and its subsections (no analysis of Siebel services); id. 8.2.6 (no discussion of certain copyright registrations); id. 9.3 (no analysis of licenses and terms of use for access); id. 9.4.1 (no analysis of how credentials are issued and modified); 11.2 (no analysis of various product lines and services); id. 11.4.1 (no analysis of protected expression); id. 11.4.2 (no analysis of de minimis copying); id. 11.5.1 (no code comparison for JDE); id. 11.6 (no fix analysis of certain JDE and Siebel versions); id. 12.1 (no analysis of post-complaint conduct); id. 13 (summarizing all the above). These potshots are immaterial and improper, several times over. First, they require no special technical expertise to make a list of what the Mandia report does not contain; the jury is just as competent to make it as is Gray. See Fed. R. Evid. 702 (requiring that experts "assist the trier of fact" with "scientific, technical or other specialized knowledge"); cf., e.g., Perry, 2010 WL 3025614 at *22 ("Blankenhorn's mere recitation of text in evidence does not assist the court in understanding the evidence 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)). Gray's laundry list is thus inadmissible because it does not satisfy the requirements of Rule 702. Second, Gray's litany of things that Mandia's report does not include (because Mandia 13 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 was not asked to include them), such as analysis of protected expression, in no way "rebuts or contradicts" the technical work that Mandia performed or his opinions based on that work as a computer forensics expert. Gray's proposed testimony on this subject is therefore not proper expert rebuttal. See Fed. R. Civ. P. 26(a)(2)(C)(ii). Third, this litany in fact is not expert testimony at all, but smuggled-in legal argument meant to suggest that Oracle failed to meet its evidentiary burden. See, e.g., Nationwide Transp. Fin. v. Cass Info. Sys., Inc., 523 F.3d 1051, 1058 (9th Cir. 2008) ("[A]n expert witness cannot give an opinion as to her legal conclusion") (internal citations and quotations marks omitted); Crow Tribe of Indians v. Racicot, 87 F.3d 1039, 1045 (9th Cir. 1996) ("Experts interpret and analyze factual evidence. They do not testify about the law") (internal citations and quotations marks omitted). It is also an illogical argument, as Oracle need not prove its entire case through one witness. Fourth, even if not considered improper legal conclusions, Gray cannot testify about standard expert practices in copyright cases, both because he was not disclosed on that subject matter and because he is not qualified on it: Gray has testified in only two copyright matters in his 35-year career. Polito Decl., Ex. B (Gray Depo.) at 109:19-25. He testified that he did not (and could not) perform protected expression analysis in the absence of assumptions provided by counsel, and that he did not (and could not) interpret terms of use or license arrangements without guidance from others. See, e.g., id. at 82:12-21 (protected expression); id. at 472:11474:25 (terms of use and license agreements). Thus, Gray's criticism that Mandia did not undertake the same analyses is unintentionally ironic, and lacking any probative value. Cf. i4i Ltd. P'ship v. Microsoft, 670 F. Supp. 2d 568, 585, 607 (E.D. Tex. 2009) (finding, in denying post-trial motions for judgment as a matter of law and for a new trial in a patent case, that Mr. Gray's testimony on anticipation was "simply unpersuasive" and "failed to approach the specificity or detail that was applied by the [other] parties"), aff'd on reh'g, 598 F.3d 831 (Fed. Cir. 2010). Mandia, like Gray, is a computer forensics expert. Polito Decl., Ex. D (Mandia Depo.) at 164:17-24. Like most experts, he was provided assumptions to use for aspects of his report 14 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 (specifically, about protected expression, see id. at 172:14-19) that are expressly stated in his report. E.g., Polito Decl., Ex. C (Mandia Report) 35, 41, 42, 44, 45. He did not conduct protected expression analysis because he quite properly assumed it would be others who would back the assumptions up. See American Booksellers Ass'n v. Barnes & Noble, Inc., 135 F. Supp. 2d 1031, 1038 (N.D. Cal. 2001) (observing that an expert "is permitted to base his expert opinion on evidence that will be proved by other witnesses at trial") (citing Fed. R. Evid. 703). Finally, for all of these reasons, Gray's testimony concerning what Mandia did not do should also be excluded because it is unfairly prejudicial and likely to confuse a jury. Gray is attempting to usurp the jury's role by asserting that Mandia failed to meet his burden of proof, offering an "expert's" imprimatur on a simple and substantively meaningless list of omissions from the Mandia report, or both. The jury may give untoward weight to such statements, even though they are unfounded, because they come from a purported technical expert. Because this testimony's unfairly prejudicial effects, and the likelihood that the testimony will confuse the jury, both substantially outweigh the probative value of this testimony, it should be excluded. Fed. R. Evid. 403. V. THE COURT SHOULD EXCLUDE ANY TESTIMONY ABOUT CONTRACTS OR INDUSTRY STANDARD PRACTICES A. Gray Is Not An Expert in Software Licenses, Website Terms of Use, Or Industry Practices Gray is not a lawyer. Polito Decl., Ex. B (Gray Depo.) at 31:22-25; 351:21-23. He also does not hold himself out as an expert "in industry practices about Web site policies in terms of use." Id. at 207:15-208:5. In "the terms of use and licensing arena," he is "not an expert [and] not competent really to analyze those things," id. at 472:16-22, and he has never held himself out as an expert in the interpretation of software licenses. Id. at 198:22-199:5. Gray reviewed only four of SAP TN's customer contracts, id. at 335:12-18, and does not refer to any specific set of Terms of Use for Oracle's websites in his report. Id. at 209:2-9. He did not do any license analysis regarding the downloading of materials using another customer's credentials, id. at 474:13-19, and disclaimed any opinion about whether SAP TN's downloading from Customer Connection was permissible under any applicable licenses or Terms of Use. Id. 15 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 at 444:9-18. He also disclaimed any opinions about whether the local environments on SAP TN's machines were permitted under the applicable customer licenses. Id. at 444:19-445:10. He testified that he did not intend to testify at trial about "the propriety or impropriety" 5 of SAP TN's behavior in dealing with its customers. Id. at 440:24-442:13. However, Gray equivocated about whether he intends to offer any opinion about the interpretation of any of Terms of Use or policies at issue in this case, id. at 208:6-209:1, and noted that there are comments in his report about Terms of Use. Id. at 208:20-23. Indeed, there are references within the Report on these topics (e.g., Polito Decl., Ex. A (Gray Report) 7.7, 9.2), as well as statements regarding the propriety of SAP TN's conduct. E.g., id. 7.4; 7.7. For two reasons, Gray should not be permitted to opine about the interpretation of software licenses and Terms of Use, the propriety of any conduct under licenses or terms of use, or industry standard practices for support of enterprise software. First, he admits he is not an expert on those subjects, a basic requirement for offering expert testimony. Fed. R. Evid. 702. Second, he has disclosed no opinions on those subjects. Fed. R. Civ. P. 37(c)(1) precludes use of any such undisclosed information at trial, absent a showing that the failure to disclose it is substantially justified or harmless. There is no excuse for failing to disclose expert opinions when sought by direct questions. The failure to disclose them at a time when there was opportunity for questioning and time to prepare to meet them is not harmless. See, e.g., Ellis v. Costco Wholesale Corp., 240 F.R.D. 627, 645 (N.D. Cal. 2007) (striking late-disclosed expert materials where the opposing party "had no opportunity to determine the basis . . . through deposition or other discovery methods"). Gray testified that to him, propriety and impropriety whether behavior was proper or improper have to do with Terms of Use and licenses. Polito Decl., Ex. B (Gray Depo.) at 583:3-6. 16 Case No. 07-CV-01658 PJH (EDL) 5 NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 B. Specifically, The Court Should Preclude Any Testimony Suggesting That SAP TN Or Its Customers May Have Been Entitled To Oracle Software And Support Materials Without Regard To Their Source Mandia's report documents thousands of copies of Software and Support Materials that SAP TN downloaded with one customer's credentials ostensibly on behalf of that customer and then used to support other customers, as well as SAP TN's extensive use of copies of one customer's local environment to support other customers. See, e.g., Polito Decl., Ex. C (Mandia Report) 215 & Table 19 (discussing SAP TN's downloading with another customer's credentials)); id. 296-299 (discussing SAP TN's cross-use of local environments). Mandia assumed (but did not opine) that such cross-use was prohibited by Oracle's license agreements and website terms of use. Id. 38-40, 46. It was. See, e.g., Dkt. 649 (Oracle's Mot. for Partial Summ. J.) at 12-13 (demonstrating, with respect to direct infringement of certain copyrights, that Defendants' cross-use was not excused by any license); Dkt. 754 (Joint Statement per August 6, 2010 Order) at 1-2 (stating the parties' agreement that summary judgment should be granted in favor of Oracle as to direct infringement of those copyrights). Gray suggests in his report, however, that SAP TN's customers may have been "entitled to the software regardless of the source of the software." Polito Decl., Ex. A (Gray Report) 8.3. However, as Gray concedes, determining whether an SAP TN customer was entitled to the software requires a customer by customer, license by license analysis. Id. 8.3. Gray did not do that. At deposition he testified he had no opinion whether a customer properly could receive software and support material that had been downloaded using another customer's credentials. Polito Decl., Ex. B (Gray Depo. at 440:12-441:12). Gray should be precluded from suggesting in his testimony at trial, as he did in his report, that SAP TN's customers may have been entitled to the Oracle materials SAP TN obtained to support them, regardless of the source of the materials. As discussed above, Gray has no qualifications as an expert to offer such an opinion, which, as he admits, requires interpretation of licenses and terms of use. Even if Gray had appropriate expertise, any such suggestion would not be not based on sufficient information and would be pure speculation on his part, since he 17 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 has not reviewed the relevant license agreements and terms of use. Speculation without regard to the facts is unreliable and inadmissible. Daubert, 509 U.S. at 591 (expert testimony must "fit" the facts of the case). In any event, no such analysis or opinion was disclosed. Fed. R. Civ. P. 37(c)(1). Under these circumstances, Gray should be precluded from making any such misleading suggestion to the jury. Fed. R. Evid. 403. C. The Court Should Also Preclude Testimony That SAP TN Properly Accessed Oracle Software And Support Materials As Its Customers' Agent Gray also asserts that SAP TN, as the customer's agent, properly downloaded the thousands of SSMs that Mr. Mandia documented, as long as SAP TN acted on behalf of an Oracle customer. Polito Decl., Ex. A (Gray Report) 7.7, 9.2. Gray offers no analysis of his own6 in support of this assertion, and he could not have any. As discussed in the prior section, he admits he is not competent to analyze software licenses and website Terms of Use, Polito Decl., Ex. B (Gray Depo.) at 472:16-22, and he did not review the pertinent licenses and terms of use. Id. at 444:9-445:10. As a result, Gray lacks the expertise, the data and information, and the use of any reliable methodology required by Daubert and Fed. R. Evid. 702 for offering an opinion regarding what the relevant licenses and Terms of use permitted SAP TN to do. Whether SAP TN was an agent of a customer does not matter. Any such testimony should be excluded. VI. THE COURT SHOULD PRECLUDE MR. GRAY'S TESTIMONY BECAUSE HE FAILED TO DISCLOSE MATERIALS HE RELIED ON OR CONSIDERED. Gray testified that the materials listed in Appendix 3 to his Report, plus the references in the Report, were the ones he relied on or considered in forming his opinions. Polito Decl., Ex. A (Gray Report) 4; id., Ex. B (Gray Depo.) at 227:12-228:3. Appendix 3 is an eight-page, singlespaced list. Polito Decl., Ex. H (Appendix 3). This list has "a bias for over-inclusion," that is, 6 Gray cites only a single parenthetical in one sentence in Mr. Mandia's report: "The password protection and Terms of Use [on certain Oracle support websites] restricted access to a customer (or agent) with an active maintenance contract with Oracle." Polito Decl., Ex. C (Mandia Report) 173, quoted twice in Polito Decl., Ex. A (Gray Report) 7.7, 9.2. 18 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 "if there was a document that [he] may or may not have considered very carefully or that was cumulative to some other document that was on there" he included it. Id. at 229:15-230:3. In fact, his listing contains a large amount of material that Gray did not actually review. As a result, Oracle cannot determine what he did and did not consider. Among the items in Appendix 3 is the entry "Plaintiffs' Deposition Exhibits 1-1880." Gray testified that this entry does not refer to individual deposition exhibits, as it appears to, but to a single electronic document containing all of them, and that he had not "touched" each individual exhibit. Id. at 229:22-232:4; id. at 233:4-19 ("I don't think that I've looked at each and every file."). Rather than considering them all, he estimated he had spent approximately 20 hours looking at more than 100 of them (i.e., less than 10%). Id. at 234:6-25. Ultimately Gray agreed that what "Plaintiffs' Deposition Exhibits 1-1880" describes is materials he had received from counsel, not all of which he actually considered in forming his opinions, and there is no way for anyone to determine which of the nearly two thousand deposition exhibits he actually considered in creating his report. Id. at 237:19-238:19; see also id. at 232:19-233:3. Similarly, Gray's Appendix 3 listed "Titan Logs," with Bates numbers "TNOR02193737, TN(Disc).82," and "Titan Source Code," with Bates numbers "TN-OR 004198347, TN (Disc).39." Polito Decl., Ex. H (3rd Appendix to Gray Report) at 5th unnumbered page. "Titan" refers to a computer program SAP TN used to scrape Oracle's websites, and "there were a lot of versions" of Titan on Disc 39. Id., Ex. B (Gray Depo.) at 241:17-24. The Titan Logs are detailed records the program created of its activity every time it ran. Did Mr. Gray look at every log file and every piece of source code on the disks? He could not say. Id. at 240:17-241:3; id. at 241:17-24. He ran searches on both disks, but he did not keep a list of the searches or the results and could not remember them. Id. at 241:10-16; 241:25243:1. There is thus no way to determine which log files or versions of source code he actually considered. Similarly, Gray's list of materials allegedly considered further includes over 200 hours of deposition testimony and over 200 additional documents. Polito Decl., 12. Given that Mr. Gray spent no more than 500-600 hours, combined, in writing his report and preparing for 19 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 his deposition, it is simply not credible that he reviewed even a fraction of these materials. Polito Decl., Ex. B (Gray Depo.) at 592:6-11. Thus, in fact, Appendix 3 is a list of materials Gray received, not a list of materials he considered in forming his opinions. Id. at 243:13-21. It is not possible to determine which documents and information Gray actually reviewed and considered. They are supposedly buried somewhere in the enormous volume of information counsel provided and Gray listed, but no one can say where. That state of affairs significantly prejudices Oracle. Oracle cannot establish that Gray formed an opinion without considering particular relevant exhibits. Oracle also cannot confront Gray with the particular logs and source code versions he considered and relied on in connection with his opinions that undermine his opinions. As a result, Oracle cannot test Gray's core opinions. Fed.R.Civ.P. 26(a)(2)(B)(ii) requires an expert such as Gray to provide "the data or other information considered by the witness in forming" his opinions. Producing an indistinguishable mass of other matter that the expert did not consider along with the required materials thwarts thorough analysis and testing of whether the expert adequately accounted for relevant information and defeats the purpose of the rule. Fed.R.Civ.P. 37(c)(1) provides the remedy: If a party fails to provide information or identify a witness as required by Rule 26(a) or 26(e), the party is not allowed to use that information or witness to supply evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless. (emphasis supplied). "Paragraph (1) prevents a party from using as evidence any witnesses or information that, without substantial justification, has not been disclosed as required by Rules 26(a) and 26(e)(1)." Fed. R. Civ. P 37(c), 1993 Advisory Committee's Note (emphasis supplied). Because Defendants' disclosure for Gray fell well short of all that is "required by Rule[] 26(a)," his testimony should be excluded. VII. CONCLUSION For the reasons stated above, the Court should (1) exclude Appendix 4 and related 20 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY 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 testimony; (2) preclude Gray from testifying about opinions that Mandia did not offer; (3) preclude testimony about software licenses, website Terms of Use and industry practices; and (4) preclude any testimony as a result of failing to disclose materials relied upon. DATED: August 19, 2010 Bingham McCutchen LLP By: /s/ Geoffrey M. Howard Geoffrey M. Howard Attorneys for Plaintiffs Oracle USA, Inc., et al. 21 Case No. 07-CV-01658 PJH (EDL) NOT. OF MOT. AND MOT. NO. 5: TO EXCLUDE TESTIMONY OF DEFENDANTS' EXPERT STEPHEN GRAY

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.


Why Is My Information Online?