Oracle Corporation et al v. SAP AG et al

Filing 859

Memorandum in Opposition re 780 MOTION Defendants' Notice of Motion and Motion to Partially Exclude Testimony of Kevin Mandia and Daniel Levy filed byOracle International Corporation, Oracle USA Inc., Siebel Systems, Inc.. (Howard, Geoffrey) (Filed on 9/9/2010)

Download PDF
Oracle Corporation et al v. SAP AG et al Doc. 859 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) 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) OPPOSITION TO DEFENDANTS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF KEVIN MANDIA AND DR. DANIEL LEVY Date: Time: Place: Judge: September 30, 2010 2:30 p.m. Courtroom 3 Hon. Phyllis J. Hamilton Case No. 07-CV-01658 PJH (EDL) SAP AG, et al, Defendants. OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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. V. IV. I. II. III. TABLE OF CONTENTS Page INTRODUCTION ............................................................................................................. 1 THE LEGAL STANDARDS............................................................................................. 3 FACTS RELEVANT TO MANDIA'S EXPERT OPINIONS .......................................... 3 A. Mandia's Qualifications ......................................................................................... 3 B. The Facts And Defendants' Admissions Shaped Mandia's Task .......................... 5 C. Mandia's Methods.................................................................................................. 6 MANDIA'S OPINIONS AND TESTIMONY ARE ADMISSIBLE ................................ 7 A. Mandia's Testimony About Protected Expression Is Admissible.......................... 9 1. Mandia is qualified to offer testimony about the creativity expressed in the software he found SAP TN copied.................................. 9 2. Mandia's methods and opinions are reliable............................................ 10 a. Mandia appropriately relied on Lichtman.................................... 10 b. Mandia appropriately relied on facts from knowledgeable Oracle employees ......................................................................... 12 B. Mandia's Testimony About The Terms Of Use, Licensing, And Improper Or Inappropriate Activity Is Admissible.............................................................. 14 1. Mandia is qualified to analyze SAP TN's downloads using the parties' licensed product information....................................................... 15 2. Mandia verified his assumptions.............................................................. 15 C. Mandia May Testify About "Cross-Use" and "Contamination" ......................... 17 D. Mandia's Testimony Regarding Copied Material Covered by Oracle's Asserted Registrations is Admissible................................................................... 19 1. Mandia Should Be Permitted To Testify That SAP TN's Copies Relate To The Registered Works ............................................................. 19 2. Mandia Should Not Be Precluded From Offering Opinions With Which Defendants' Expert Disagrees ...................................................... 20 E. Mandia's Testimony Is Not Unduly Prejudicial .................................................. 21 THE COURT SHOULD DENY DEFENDANTS' MOTION TO PARTIALLY EXCLUDE DR. LEVY'S TESTIMONY ........................................................................ 23 A. Levy Properly Analyzed Mandia's Data Without Independently Recollecting That Data......................................................................................... 23 B. Levy's Report Contains Descriptive Context, But Not Legal Conclusions......... 24 C. Levy Discusses "Contamination" And "Cross-use" Only To Refer To Measures And Terms Defined By Mandia........................................................... 25 CONCLUSION ................................................................................................................ 25 i Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 Am. Booksellers Ass'n v. Barnes & Noble, Inc., 135 F. Supp. 2d 1031 (N.D. Cal. 2001) ................................................................................. 17 Arista Records LLC v. Usenet.com, Inc., 608 F. Supp. 2d 409 (S.D.N.Y. 2009).................................................................................... 14 Autoskill Inc. v. Nat'l Educ. Support Sys., Inc., 793 F. Supp. 1557 (D.N.M. 1992), aff'd, 994 F.2d 1476 (10th Cir. 1993)............................ 11 Barefoot v. Estelle, 463 U.S. 880 (1983) ............................................................................................................... 17 Computer Assocs. Int'l v. Quest Software, Inc., 333 F. Supp. 2d 688 (N.D. Ill., 2004) ........................................................................ 10, 11, 13 Evolution, Inc. v. Suntrust Bank, 2004 WL 5684007 (D. Kan. 2004) ........................................................................................ 12 Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340 (1991) ............................................................................................................... 11 Hangarter v. Provident Life and Accident Ins. Co., 373 F.3d 998 (9th Cir. 2004).................................................................................................. 23 Humetrix, Inc. v. Gemplus S.C.A., 268 F.3d 910 (9th Cir. 2001)............................................................................................ 14, 21 In re TMI Litig., 193 F.3d 613 (3d Cir. 1999)................................................................................................... 14 Int'l Adhesive Coating Co. v. Bolton Emerson Int'l, Inc., 851 F.2d 540 (1st Cir. 1988) ............................................................................................ 13, 14 Johnson Controls, Inc. v. Phoenix Control Sys., Inc., 886 F.2d 1173 (9th Cir. 1989)................................................................................................ 11 Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137 (1999) ......................................................................................................... 10, 15 Lanard Toys Ltd. v. Novelty, Inc., 2010 WL 1452527 (9th Cir. 2010)......................................................................................... 12 Mooring Capital Fund v. Knight, 2010 U.S. App. LEXIS 15114 (10th Cir. July 22, 2010)....................................................... 24 ii Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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)................................................................................................ 22 Salinas v. Amteck of Ky., Inc., 682 F. Supp. 2d 1022 (N.D. Cal. 2010) ................................................................................. 10 SEC v. Leslie, No. C 07-3444, 2010 U.S. Dist. LEXIS 76826 (N.D. Cal. July 29, 2010) ............................ 22 Spring Co. v. Edgar, 99 U.S. 645 (1878) ................................................................................................................. 17 Sun Microsystems Inc. v. Hynix Semiconductor Inc., 608 F. Supp. 2d 1166 (N.D. Cal. 2009) ................................................................................. 14 TK-7 Corp. v. Estate of Barbouti, 993 F.2d 722 (10th Cir. 1993)................................................................................................ 22 United States v. Mejia, 545 F.3d 179 (2d Cir. 2008)................................................................................................... 14 RULE Fed. R. Civ. P. 33 ........................................................................................................................... 6 Fed. R. Evid. 104 ......................................................................................................................... 19 Fed. R. Evid. 403 .................................................................................................................. passim Fed. R. Evid. 702 .................................................................................................................. passim Fed. R. Evid. 703 ............................................................................................................. 19, 20, 24 iii Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 I. INTRODUCTION SAP TN has now stipulated to "all liability on all claims" that Oracle asserted against it for downloading over 9 million files from Oracle's website in violation of federal and state computer fraud laws and making many thousands of copies of Oracle's copyrighted software in violation of the Copyright Act.1 SAP AG and SAP America have stipulated to vicarious liability for SAP TN's copyright infringement and accepted financial responsibility for any judgment against them or SAP TN. The parties have stipulated (subject to the Court's approval) that the jury will be instructed as to this liability, and that each party may introduce evidence relating to it during trial.2 Mandia's and Levy's testimony will concern the nature and scope of Defendants' activities that underlie the now admitted liability and contribute to the damages that Oracle has suffered in this case. This testimony is not called into question by Defendants' motion, which expressly does not challenge Mandia's or Levy's analysis of the extent of the activities in question. (Neither Defendants nor their experts even attempted to replicate Mandia's years-long effort to review and analyze over 12 terabytes of Oracle's software on Defendants' systems). Instead, the motion questions only whether Mandia and Levy are sufficiently qualified or have sufficient basis to opine on various predicate issues for SAP TN's now-conceded direct liability for example, that the millions of downloaded and copied materials Mandia counted contain "protected expression," that they were downloaded and used without regard to licensing and terms of use, that they are covered by Oracle's copyright registrations, and that they evidence violation of all the asserted copyrights. In light of the parties' stipulations, there is no good reason for Defendants to object to this sort of explanatory testimony. However, Defendants have refused to withdraw their motion. Oracle accordingly submits this opposition. Defendants also seek to preclude Mandia and Levy from using a handful of words and phrases that (mostly) appear in their reports, either under Fed. R. Evid. 403 or as "improper legal See Dkt. 837 (Trial Stipulation No. 1) at 1. Id. at 4 (stipulating that Oracle is permitted to present evidence "related to the stipulated claims as background or context for the stipulated claims, and/or as relevant to damages or other claims and defenses not stipulated to or dismissed by the Parties.") 2 1 1 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 conclusions" (which is simply a prejudice argument in disguise). The terms Defendants find offensive include such things as "cross-use," "contamination," and references to copyright infringement, breach of a license agreement or terms of use, and statements that SAP TN acted "inappropriately" or "improperly." But the stipulation that SAP TN is liable on all claims has removed any possibility of undue prejudice from the use of these terms, since Defendants have conceded liability for the conduct these terms address. Moreover, Mandia's and Levy's use of these terms is fully justified. For example, Defendants seek to exclude references to "cross-use" of software. Cross-use refers to SAP TN's use of one customer's software to support another customer (which no license permits). Mandia and Levy analyzed and quantified this highly probative activity and use this descriptive term to refer to it. Defendants claim in their motion that the term is "unsupported" and "improper (and prejudicial) legal opinion." Defendants even assert that Oracle's counsel invented the term. Not true. Defendants invented the term, and still used it nearly a year after Oracle filed the litigation, in meetings to discuss their own continued "cross-use" of "one HRMS 7.5 environment" to support multiple customers. The email excerpted below (sent to the SAP AG project lead Martin Breuer and copying SAP TN's General Counsel, Tom Nolan), introduces the minutes from one such meeting to discuss "Cross-Use" environments: Defendants' other challenges also ignore the facts and the law, and are rendered inconsequential by the liability stipulation. For example, Defendants argue that Mandia should not be permitted to reference the "Terms of Use," alleging he never sought to understand them. But they redact from their evidence as "NOT RELEVANT TO MOTION" Mandia's testimony 2 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 that he did review them "to understand that my assumptions seemed reasonable to me." They also seek to exclude the words "inappropriate" and "licensed products," even though SAP stated publicly in July 2007 (and countless times since then) that SAP TN had "inappropriately" downloaded products "not licensed" by its customers. And they continue to challenge the "reliability" of Mandia's conclusion (informed by knowledgeable witnesses) that the enterprise software applications he analyzed contained at least a "modicum" of creative expression protected by Oracle's copyrights, despite stipulating that Oracle may remind the jury at any time that SAP TN infringed 120 Oracle copyrights.3 All told, Defendants ask the Court to exclude nine categories of testimony (six for Mandia and three for Levy). Mot. at pp. 5, 16. Defendants lump various categories of testimony into generalized arguments about 1) qualifications, 2) reliable methods, and/or 3) prejudice. To facilitate more focused consideration of the testimony at issue, this Opposition is organized by the subject matter of Defendants' requested relief rather than the order of their generalized arguments. The Court should deny Defendants' motion in its entirety as a waste of time and counter to their liability stipulation. Alternatively (or additionally), the Court should deny Defendants' motion in its entirety for the reasons explained below. II. THE LEGAL STANDARDS To avoid repetition, Oracle has set forth the legal standards applicable to its opposition briefs in the Opposition to Defendants' Motion to Exclude Testimony of Paul Pinto, at Sec. III. Additional relevant authorities are referenced below. Mandia and Levy are well qualified, and their testimony reliable and admissible, under all relevant standards. III. FACTS RELEVANT TO MANDIA'S EXPERT OPINIONS A. Mandia's Qualifications Mandia, Oracle's computer forensics and security expert, is the founder and CEO of 3 Defendants separately seek to exclude the testimony of these Oracle witnesses as "undisclosed experts" in their Motion in Limine No. 5. That motion is also now beside the point. Whether Oracle's employees are fact witnesses or "undisclosed experts" (whom Defendants have deposed), their testimony would only provide background or context for the copyright infringement that Defendants now do not dispute in their liability stipulation. 3 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 Mandiant Corporation ("Mandiant"), which performs computer forensics and high technology investigations, and currently employs over 100 computer forensics consultants and software engineers. Decl. of Scott Cowan in Supp. of Defs.' Mot., Dkt. 782 ("Cowan Decl."), Ex. A (Mandia Report) at 26, 29.4 Mandia received a B.S. in computer science from Lafayette College in 1992, with concentrations in software engineering, the C programming language, and database development, and an M.S. in forensic science from The George Washington University in 1995. Id., Ex. G (Mandia C.V.) at 5; Russell Decl., 4 & Ex. B (Mandia Depo.) at 163:17168:1. He is the principal architect of Mandiant's enterprise forensic software, written in multiple programming languages. He has supervised a team of 20 software developers in the continued development, licensing and successful distribution of that software. Cowan Decl., Ex. A (Mandia Report) at 29; Russell Decl., Ex. B (Mandia Depo.) at 177:9-178:18. Mandia has investigated unauthorized access to computer systems, theft of intellectual property, computer intrusions, and other computer crimes like those in this case for over 15 years, including forensic investigation of Oracle databases and "comparison of registered, original computer programming source code with alleged stolen source code" using widelyaccepted MD5 hashing and "diff" comparison tools. Cowan Decl., Ex. A (Mandia Report) at 31 & Ex. G (Mandia C.V.) at 5; Russell Decl., Ex. B (Mandia Depo.) at 505:16-506:10, and 5 & Ex. C (Mandia Appendices) at 1-2, 42-51. He has served as an expert in 10 criminal cases, eight civil cases and one international tribunal matter. Cowan Decl., Ex. G (Mandia C.V.) at 710; Russell Decl., Ex. B (Mandia Depo.) at 7:23-11:17. Mandia is a preferred computer security and forensic investigation expert for the CIA and FBI, and for dozens of public and private companies. Cowan Decl., Ex. A (Mandia Report) at 31, Ex. G (Mandia C.V.) at 3-4. He has taught at Carnegie Mellon University and The George Washington University. He is the coauthor of a leading textbook on intrusions to computer systems. Id., Ex. A (Mandia Report) at 27. He has trained hundreds of law enforcement officials, including Assistant U.S Attorneys, 4 Mandia was assisted in various aspects of his analysis and review in this case by a team of Mandiant employees. See Russell Decl., Ex. B (Mandia Depo.) at 131:25-132:18, 133:15134:17, 142:24-144:11, 485:4-486:18. 4 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 FBI agents and Secret Service agents, in computer forensics and security incident response. Id., Ex. G (Mandia C.V.) at 3-4, Ex. A (Mandia Report) at 27. In short, Mandia is a pre-eminent expert in computer forensics investigations of matters like Defendants' activities in this case.5 B. The Facts And Defendants' Admissions Shaped Mandia's Task Few copyright defendants acknowledge widespread, literal copying of registered works, as Defendants did early in this case. SAP AG admitted in July 2007, not long after Oracle caught SAP TN red-handed, that SAP TN had downloaded "inappropriately" from Oracle's websites. Russell Decl., 6 & Ex. D (July 3, 2007 Press Release). Then SAP TN admitted in October 2007 it had made literal copies of entire Oracle enterprise software applications. Id., 7-8 & Ex. E (Kreutz 30(b)(6) Depo.) at 94:7-18 (J.D. Edwards World and J.D. Edwards EnterpriseOne environments), Ex. F (Shelley Nelson 30(b)(6) Depo.) at 13:10-14:7 (PeopleSoft environments). It took three more years, but Defendants eventually admitted they had downloaded at least 5 million Oracle files and cross-used thousands of Oracle application copies to deliver the vast majority of their fixes and updates. Defendants slowly began producing certain portions of SAP TN's systems in August 2008, with the bulk coming after Judge Laporte ordered a scheduled, rolling production on November 26, 2008. Dkt. 222 (Disc. Conf. Order); see, e.g., Dkt. 291 (Jt. Disc. Conf. St.) at 10:17-13:7 (summary of production history). They eventually produced over 12.9 terabytes of software and support materials from approximately 46 servers (in addition to millions of other documents), much of which Mandia had to decompress, adding many more terabytes and millions of files. See Russell Decl., Ex. C (Mandia Appendices) at 2; Cowan Decl., Ex. A (Mandia Report) at 171, 259-260. (The entire printed collection of the Library of Congress would translate to about ten terabytes of data. See Russell Decl., 9 & Ex. G. In response to Oracle's discovery requests to explain how they cross-used this vast library of copyrighted material, Defendants stated "it would be impossible and unreasonable to expect TomorrowNow Dr. Levy's qualifications are addressed in Sec. V, below. Since Defendants included both experts in one motion, Oracle does the same. 5 Case No. 07-CV-01658 PJH (EDL) 5 OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 to provide a detailed description of the support provided with each local environment," and then consistently referred Oracle back to the colossal data set citing Fed. R. Civ. P. 33(d). See, e.g., id., 10 & Ex. H (Rogs. 12 & 14). This left Mandia with an analytical task unprecedented in the annals of software theft. It required painstaking searches to identify and quantify Defendants' copying, and due to the data volume even one file comparison search against SAP TN's servers took days or weeks. See, e.g., Dkt. 349 (Mandia Decl. re Mot. to Amend Complaint). C. Mandia's Methods Mandia's task was to make sense of this mass of data and "to render [his] opinions regarding the means and methods by which SAP TN accessed and downloaded from Oracle's customer support websites, as well as the nature and extent of SAP TN's copying, modification, distribution, and use of Oracle intellectual property to support SAP TN's customers." Cowan Decl., Ex. A (Mandia Report) at 2. His methodology had three essential parts: Mandia reviewed evidence, including documents and SAP TN employee testimony, to understand generally SAP TN's business model and the manner in which it used Oracle's materials. He combed Defendants' data productions for evidence of downloading, installing, backing up, restoring, and other copying of Oracle materials. Among other things, he compared materials found on SAP TN's systems to Oracle materials produced in the case to confirm the scope of Defendants' admitted copying. In this manner, Mandia formed opinions about the amount of Oracle software and support materials on SAP TN's computers, and the nature and extent of SAP TN's use of those copies. For certain analyses of materials too voluminous for actual counting, Mandia collaborated with Oracle's statistical expert, Dr. Daniel Levy, to select valid samples that would reasonably represent the broader universe of SAP TN's copies. See id., 9, 108, 295, 296 n.152; see generally id. at 292-347 & Ex. D (Levy) Report at pp. 1-6. Mandia also undertook to understand the nature of Oracle's software and support materials at issue. He discussed their development and installation with Oracle's knowledgeable employees, and reviewed the software and support materials he was provided.6 In addition, 6 For discussions with Oracle employees, see, e.g., Cowan Decl., Ex. A (Mandia Report) at 108 & n.7, 112-113 & n.8, 120-123, 270 n.130, 274 n.133, 280 n.139, 284; Russell (Footnote Continued on Next Page) 6 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 Mandia spoke with Oracle's expert Douglas Lichtman about what qualifies computer code for copyright protection. See, e.g., Cowan Decl., Ex. A (Mandia Report) at 115. Then, relying on his own experience building enterprise software, his computer science background, his discussions with Oracle employees and Lichtman, and his review of Oracle materials, Mandia formed opinions about the creativity expressed in the Oracle software he found in Defendants' production. See, e.g., id., 116, 123. Finally, to relate the results of his analysis to the issues in the case, Mandia applied to his technical results assumptions that he determined were 1) justified based on the information he learned and the evidence he reviewed, and 2) appropriate in the context of his analysis. In particular, as any expert would do, he used assumptions based on what he determined was reasonable, and verified information that others would prove at trial. These included terms of Oracle's customers' license agreements and the Terms of Use on Oracle's websites. Mandia incorporated these assumptions in his conclusions that various SAP TN activities he analyzed were inappropriate or improper (as SAP TN had already admitted). See, e.g., id., 38-40, 4647 (stating the improper activity assumptions); id. at 190-216 (conclusions based on applying these assumptions to his analysis). Similarly, he applied an assumption about which Oracle software and support materials the copyright registrations asserted in this case cover, as summarized in Tables 35 and 36 of his Report, in concluding that the copies of those materials he located on SAP TN's systems were covered by Oracle's copyrights-in-suit. See id., Ex. A (Mandia Report) at 45 (stating the scope assumption), 373-374, 376-377 (conclusions based on applying the assumption to his analysis). IV. MANDIA'S OPINIONS AND TESTIMONY ARE ADMISSIBLE Defendants asserted throughout the litigation that the source of their admitted literal copies was Oracle-issued software they obtained directly from customers. Accordingly, Decl., Ex. C (Mandia Appendices) at p. 8 n.21, pp. 17, 120. For review of software and support materials provided by Oracle, see Cowan Decl., Ex. A (Mandia Report) at 224 & Table 21 (PeopleSoft and J.D. Edwards support materials), 266 n.128 (J.D. Edwards software), 276 n.135 (Siebel software), 283 (Oracle Database software); Russell Decl., Ex. C (Mandia Appendices) at pp. 17-18 & Table 10 (PeopleSoft software), pp. 38-39 (J.D. Edwards, PeopleSoft, and Siebel support materials). 7 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 Mandia's overarching task was to find, quantify, and correlate the copies of Oracle software and support materials on SAP TN's systems. Mandia opinions not challenged: The majority of Mandia's report describes his counts of copies of Oracle software on SAP TN systems. He reports counts of Oracle enterprise software applications (environments), files taken from those environments for distribution to SAP TN customers, and Oracle Database software; and explains his counting methods, including through collaboration with Levy. Defendants do not challenge these aspects of Mandia's testimony in their motion. Mot. at 1:19-22 ("This motion does not seek to exclude Mandia's or Levy's counts."). By analyzing SAP TN's copies and the other evidence in the case, Mandia gained substantial insight into SAP TN's business methods. Cowan Decl., Ex. A (Mandia Report) at 102-158 (Mandia's 18-page analysis of SAP TN's business model across all major products at issue). Defendants do not challenge these business methods opinions, either. Indeed, although Defendants' motion once asserts "irrelevance" as a basis for excluding Mandia's testimony, Defendants never offer supporting evidence or argument. Compare Mot. at 8:4-5 ("[T]he Court should exclude these portions of Mandia and Levy's testimony as both unreliable and irrelevant.") with Mot. at 7:20-15:4 (never explaining how Mandia's opinions are "irrelevant" to the case). They could not. Mandia's testimony concerns downloading, copying, and cross-use of Oracle's software, activity that is at the heart of the case. Cowan Decl., Ex. A (Mandia Report) at 2, 4-13. Summary of argument against Mandia: Instead, Defendants' motion seeks primarily to limit Mandia's testimony concerning the creativity and protectability of Oracle's five product lines and the multiple versions of its copyrighted software that he looked for and found on SAP TN's systems. Defendants' sole Daubert challenges to that testimony are to Mandia's qualifications and the reliability of his methods of obtaining certain information he used: interviewing knowledgeable Oracle employees, collaborating with other experts, gathering information through his own employees, and making use of assumptions that he investigated and expects others will prove up at trial. All these matters have now been made academic by Defendants' stipulation to liability. 8 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 Defendants also wish to prevent Mandia from uttering five phrases: 1) "infringement," which appears nowhere in his report; 2) "cross-use," a factual and highly probative term describing the use of one customer's software, support materials or credentials to support other customers; 3) "contamination," another factual and highly probative term describing software or support materials resulting from cross-use; 4) "inappropriately," a term used by, among others, SAP AG's then-CEO, Henning Kagermann in July 2007 to describe SAP TN's downloads; and 5) "improperly," a synonym for "inappropriately" that Mandia uses in his report. Mot. at 5. As to these terms, Defendants' motion is properly construed as a motion in limine under Fed. R. Evid. 403. Seeking to shift the burden of persuasion to Oracle, however, Defendants incorrectly call these terms "legal conclusions" or "unverified assumptions" that Mandia is not qualified to present. Defendants lose under either the Fed. R. Evid. 403 or Daubert standard. A. Mandia's Testimony About Protected Expression Is Admissible Mandia concluded that copies of Oracle materials on SAP TN's systems contain protected expression. Defendants' stipulation of "all liability on all claims" concedes this point. Defendants attack this testimony in two ways. See Mot. at 5, exclusion requests Nos. 2 & 5. First, they argue Mandia is not qualified to offer these opinions. Id. at 7:12-15. Second, they argue he uses unreliable methods. Id. at 10:10-15. Both arguments are wrong. 1. Mandia is qualified to offer testimony about the creativity expressed in the software he found SAP TN copied Defendants argue that Mandia is not "qualified to opine that Plaintiffs' registered works contain creative expression" because he does not have "any expertise in the software lines at issue in this case." Mot. at 7:12-15. This argument contradicts the facts, the law and the methodology of Defendants' own expert. Defendants also misconstrue the role of a Rule 702 expert. He is not required to have personal experience with each specific aspect of every case, but to reliably apply relevant expertise to an investigation of the facts, including those that others will prove, thereby generating opinions helpful to the jury. That is exactly what Mandia did. First, Mandia has relevant, first-hand experience in software engineering that qualifies him to assess the creativity in Oracle's software. Second, Mandia supplemented his own 9 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 knowledge sufficient by itself with information from other reliable product-specific resources. That combination suffices for him to offer opinions about portions of the Oracle source code with which he may have been less familiar. See Computer Assocs. Int'l v. Quest Software, Inc., 333 F. Supp. 2d 688, 693-94 (N.D. Ill., 2004) (permitting testimony by an expert who "refer[red] to reasonable sources for assistance" with analysis of certain programming languages). Again, it is what experts do. See Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 156 (1999) ("[A]n expert [may] "draw a conclusion from a set of observations based on extensive and specialized experience.").7 Defendants' software expert, Gary Funck, operates under the same principle. Russell Decl., 11 & Ex. I (Funck Depo.) at 45:9-46:10; 48:18-53:3 ("[With] sufficient access to resources and perhaps other people that I can use as resources, then I might feel that I've gained sufficient experience and expertise to offer an opinion."). 2. Mandia's methods and opinions are reliable. Mandia drew on multiple sources of information to conclude SAP TN copied protected expression. He considered his own software development experience. Cowan Decl., Ex. A (Mandia Report) at 26-32; see also id., Ex. G at 3-10. He examined terabytes of software copies residing on SAP TN's systems. See, e.g., id., Ex. A at 168 (identifying 4,062,617 downloaded Oracle files) & 259 (more than 10 terabytes of over 20 million files). He analyzed other discovery materials detailing SAP TN's processes and procedures for copying and installing Oracle's software. See, e.g., id. at 126 n.10. Defendants dispute none of this. However, he also relied on two more sources of information that Defendants argue render his testimony inadmissible: 1) assumptions to be supported by other evidence at trial, and 2) facts about the software provided by knowledgeable and percipient Oracle employees. a. Mandia appropriately relied on Lichtman To understand how his work fit within the context of an analysis Defendants had Mandia's reliance on verified facts and reasonable assumptions for his analysis of the software on SAP TN's systems contrasts with the cases cited by Defendants. See, e.g., Salinas v. Amteck of Ky., Inc., 682 F. Supp. 2d 1022, 1030-31 (N.D. Cal. 2010) (Hamilton, J.) (excluded expert had not "employed a methodology that would allow him to opine as an expert on warnings," because he never examined the most relevant evidence, never interviewed percipient witnesses, and "conducted no vetting"). Salinas confirms the propriety of Mandia's witness interviews. Id. 10 Case No. 07-CV-01658 PJH (EDL) 7 OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 dismissed as "impossible," (Russell Decl., 10 & Ex. H (Rog. 14)), Mandia properly consulted Professor Lichtman, a copyright expert with a computer science background, among several other resources, to help him decide what to look for in Defendants' massive production. See e.g., Computer Assocs., 333 F. Supp. 2d at 694 (finding that an expert's "methodology ... in searching for copying was reliable" where the expert reviewed "the areas of the program in which [the plaintiff] (and its attorneys) believed copying would be found"). From Lichtman, Mandia understood "that computer code in various forms qualifies for legal protection as long as it demonstrates a modicum of creativity." Cowan Decl., Ex. A (Mandia Report) at 115. That is indisputable. See Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 346 (1991) ("modicum of creativity."); Johnson Controls, Inc. v. Phoenix Control Sys., Inc., 886 F.2d 1173, 1175 (9th Cir. 1989) ("Source and object code, the literal components of a program, are consistently held protected by a copyright on the program."); Dkt. 747 (Defs.' Proposed Jury Instructions) at 60 (No. 5, stating that software incorporating "original expression" is protected); id. at 80 (No. 13, "The original parts of [Oracle's] work are the parts created ... by use of at least some minimal creativity."). Even if it were disputed, Mandia could properly rely on Lichtman in these circumstances. Fed. R. Evid. 702 advisory committee's note (2000) (expert opinion may be based on "the reliable opinions of other experts"); see also Autoskill Inc. v. Nat'l Educ. Support Sys., Inc., 793 F. Supp. 1557, 1561, 1568-71 (D.N.M. 1992) (relying upon the creativity testimony of an expert in software use who "reviewed cases and the Nimmer treatise on copyright infringement" prior to testifying), aff'd, 994 F.2d 1476 (10th Cir. 1993); id. at 1567 (same, with respect to protected expression testimony). In light of these facts, Defendants' refrain that Mandia is not a "copyright expert" does not disqualify him from expressing the opinions he does about SAP TN's copying of protected expression. Nor is it true that Mandia "simply parrots the unverified assumptions" of others. Mot. at 8:7-9:9. Mandia combined Lichtman's correct advice with the input of knowledgeable witnesses, his own programming experience, and his own analysis of the terabytes of copies on SAP TN's systems, to conclude for himself that SAP TN copied protected expression. See, e.g., Cowan Decl., Ex. A (Mandia Report) 373 (SAP TN's copies contain protected expression 11 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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]ased on information received from Mr. Screven and Mr. Lichtman, and based on my own experience relating to software development."). This approach falls squarely within the most routine type of expert analysis. There is no basis to exclude it. b. Mandia appropriately relied on facts from knowledgeable Oracle employees Mandia properly sought information from Oracle employees knowledgeable about the software. See Lanard Toys Ltd. v. Novelty, Inc., 2010 WL 1452527 at *4 (9th Cir. 2010) (stating that copyright validity was "reinforced" by testimony of designer that he "could have designed [the copyrighted work] in `a million' other ways"); Evolution, Inc. v. Suntrust Bank, 2004 WL 5684007 at *1-2 (D. Kan. 2004) (admitting testimony from expert who relied upon information from company president where no suggestion of "better or more accurate information" about the `business or software' existed"). Oracle's products are written in multiple computer languages. See, e.g., Cowan Decl., Ex. A (Mandia Report) at 65, 109. Mandia has "an in-depth understanding of computer programming," including two languages at issue C and COBOL. Id., 26, 29-30; Russell Decl., Ex. B (Mandia Depo.) at 177:9-181:5. As he states: [B]ased on my own experience with shell scripts and other interpreted languages, and based on my own experience with COBOL and other compiled languages, I understand that development in these languages involves a developer's particular choices and embodies creative expression. Cowan Decl., Ex. A (Mandia Report) at 114; see also id. at 122. Mandia confirmed his independent understanding of software development with Oracle employees knowledgeable about the specific languages and products SAP TN copied.8 Id. at 108. He interviewed employee Norm Ackermann about PeopleSoft software. Ackermann joined PeopleSoft in December 1995, and helped develop more than 75 tax and regulatory updates (each of which contained several to dozens of individually developed program files). Russell Decl., 12 & Ex. J (Ackermann Depo.) at 5:25-6:1, 44:6-8. Mandia explained: Mandia's employees also appropriately assisted him. For instance, contrary to Defendants' claim that Mandia relied "solely on the opinion of Oracle employee Greg Story" when analyzing SAP TN's AS/400 (Mot. at 13:7-12), Mandia collaborated with his employee, Cory Altheide, who had relevant expertise, to analyze information gathered by Altheide and Story. See Russell Decl., Ex. B (Mandia Depo.) at 485:4-486:25, and 14 & Ex. L (Story Depo.) at 20:4-17, 57:512 & 72:2-21. Altheide's working notes were produced to Defendants. Id., 15. 12 Case No. 07-CV-01658 PJH (EDL) 8 OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 One reason why I spoke to [Ackermann] was, I was asked to make an assumption about file-based objects being protected expression, and I wanted to know if that was a reasonable assumption. So speaking to Mr. Ackermann, who was a PeopleSoft developer, I asked him some questions about choice and creativity, things of that nature. . . . I think he was providing me facts. Id., 4 & Ex. B (Mandia Depo.) at 274:25-278:12 (emphasis supplied). Similarly, Mandia interviewed Edward Screven, Oracle's Chief Corporate Architect, who regularly participates in "technical discussions" about how Oracle software products at issue in this case "are built [and] the way they should be built." Russell Decl., 13 & Ex. K (Screven Depo.) at 15:7-16, 16:1917:16 (redacted by Defendants as "NOT RELEVANT TO MOTION" at Cowan Decl., Ex. B). Screven verified, among other things, 1) aspects of Oracle's development process, 2) ways to identify software on SAP TN's systems, and 3) how the code in fixes, updates, and prior software versions gets incorporated into later releases. Cowan Decl., Ex. A (Mandia Report) at 109-123, 269 & fns. 7, 8, 106, 130, 133, 137, 139. Mandia's interviews of knowledgeable Oracle employees was proper methodology; interviewing knowledgeable witnesses is what experts should do. Computer Assocs., 333 F. Supp. 2d at 693-94 (source code report admitted as "helpful" when expert had "significant experience working with database systems" but not "the same level of expertise in C or C++" where he "was able to refer to reasonable sources for assistance"); see also Int'l Adhesive Coating Co. v. Bolton Emerson Int'l, Inc., 851 F.2d 540, 545-46 (1st Cir. 1988) ("obvious" that an expert would rely on "interviews with company personnel.").9 Mandia did not obtain "unchecked assumptions" from these employees (Mot. at 12:13-15), but rather informed his analysis and confirmed his conclusions with multiple reliable sources.10 9 Defendants' expert Gray uses the same methodology as Mandia. He relied upon conversations with SAP TN employees and assumptions about protected expression in his own report. He testified that he relied on party employees in prior copyright litigation engagements and, indeed, could not evaluate protected expression without guiding assumptions and further information from Oracle employees (which Defendants never sought). Russell Decl., 17-18 & Ex. M (Gray Report) at 44 n.110 & 63-64 nn.167-168 (Gray's analysis is "based on conversation[s] with" SAP TN former employees and consultants), and 24-25 (needing "Oracle employee's [sic] opinions" to "fully evaluate" protected expression), Ex. N (Gray Depo.) at 115:18-118:6 & 119:3-120:3 (prior expert engagements where Gray relied on conversations with employees). Mandia's years of independent work and reliance on knowledgeable witnesses whom Defendants have deposed (and who are on Oracle's witness list, Dkt. 742) contrasts with the (Footnote Continued on Next Page) 13 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 10 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 Defendants deposed both Mandia and, with one exception, every Oracle employee of whom they complain. See Russell Decl., 16; Dkt. 790 (Oracle's Opp. to Defs.' MIL) at 15:1716:27 (details of Defendants' access to and depositions of these employees). If Defendants disputed the accuracy of the information the employees provided, then that would be an issue for trial, not grounds for exclusion. See Humetrix, Inc. v. Gemplus S.C.A., 268 F.3d 910, 919 (9th Cir. 2001) ("[T]he reasonableness of the assumptions underlying the experts' ... analysis, [and] criticisms of an expert's method of calculation [are] matter[s] for the jury's consideration in weighing that evidence."); Sun Microsystems Inc. v. Hynix Semiconductor Inc., 608 F. Supp. 2d 1166, 1208-09 (N.D. Cal. 2009) (Hamilton, J.) ("[T]o the extent that defendants challenge the accuracy or propriety of these variables, it is an issue that goes to the weight, rather than the admissibility . . . ."); Int'l Adhesive, 851 F.2d at 545 ("especially significant" that other party had access to information relied on and were "rehashing . . . the central factual disputes of the case dressed up as attacks on the expert's testimony through Rule 703."). Attacks on Mandia's methodology of interviewing and relying on knowledgeable witnesses would be unwarranted and improper, even if Defendants had not effectively stipulated to his conclusions. B. Mandia's Testimony About The Terms Of Use, Licensing, And Improper Or Inappropriate Activity Is Admissible Defendants make two unmeritorious attacks on the admissibility of Mandia's opinions related to SAP TN's downloading activity. See Mot. at 5, exclusion requests Nos. 1 & 5. First, Defendants argue Mandia is not qualified to offer them. Id. at 7:10-12. Second, Defendants argue they are based on assumptions counsel provided, with no independent analysis by Mandia. Id. at 10:10-15, 11:26-12:11. Both are wrong, and also academic in light of Defendants' stipulation to SAP TN's liability for the downloads. cases Defendants cite. See In re TMI Litig., 193 F.3d 613, 713-16 (3d Cir. 1999) (excluding testimony where expert "never made any attempt to assess the validity of any of [his] assumptions"); United States v. Mejia, 545 F.3d 179, 195-98 (2d Cir. 2008) (testimony of a police officer's who did not "piece[] together bits of information from different sources and reach[] a studied conclusion" but instead "repeat[ed] their contents" violated Rule 702); Arista Records LLC v. Usenet.com, Inc., 608 F. Supp. 2d 409, 425-26 (S.D.N.Y. 2009) (expert "merely accepted" what defendants told him, reviewed "none" of the relevant "objective evidence" in the record, and "was operating under a factually incorrect assumption"). 14 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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. Mandia is qualified to analyze SAP TN's downloads using the parties' licensed product information Mandia is eminently qualified to identify the downloaded software and other materials on SAP TN's systems, to categorize the downloads according to the licensed product information from both parties, and thereby assist the trier of fact in understanding the extent to which SAP TN disregarded licensed product representations from its customers when downloading Oracle materials. See Section III.A., above; Cowan Decl., Ex. A (Mandia Report) at 198-218 & Russell Decl., Ex. C (Mandia Appendices) at pp. 124-127 (explaining Mandia's methodology); Kumho Tire, 526 U.S. at 156 (stating that an expert may "draw a conclusion from a set of observations based on extensive and specialized experience."). 2. Mandia verified his assumptions To identify downloads representative of Oracle's claims (of the more than 9 million on SAP TN's systems), Mandia made two strategic choices. First, he searched for downloads related to products for which customers had not purchased a license, according to licensing information obtained from Oracle and, separately, similar contractual information from SAP TN's own records. Cowan Decl., Ex. A (Mandia Report) at 205-211. Second, he made an informed assumption about Oracle's websites' Terms of Use (which incorporate a customer's license terms), so he could analyze which downloads were consistent or inconsistent with them. Id. at 46-47. These choices squarely reflect Defendants' early concessions about SAP TN's "inappropriate" access and downloading.11 See Russell Decl., 6, 19, 20 & Ex. D (July 3, 2007 Press Release) (admitting "some inappropriate downloads"), Ex. O (July 3, 2007 Teleconference, SAP CEO Henning Kagermann) ("With inappropriate, I meant ... they downloaded support material where they were not allowed to download according to the support contract of the customer."), Ex. P (Rog. 13) at 66 (Certain downloads "were considered by TomorrowNow to be `inappropriate' because it was TomorrowNow's policy to only download materials for customers related to those products for which the customer had informed 11 "Improper," another word Defendants challenge, is simply a synonym for "inappropriate." See, e.g., Cowan Decl., Ex. A (Mandia Report) at 193-194 (using "inappropriate" and "improper" interchangeably). 15 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 TomorrowNow they were licensed.") (all emphasis supplied).12 Mandia also independently evaluated what the Terms of Use permitted. Defendants assert Mandia had "no independent expert opinion regarding whether the terms of use assumption that counsel provided is valid." Mot. at 3:21-23. But they redact as "NOT RELEVANT TO MOTION" Mandia's testimony that he "read [the Terms of Use] from a layperson's perspective to understand them, to understand that my assumptions seemed reasonable to me." Compare Russell Decl., Ex. B (Mandia Depo.) at 197:9-198:14 with Cowan Decl., Ex. B (Mandia Depo.). Defendants also assert Mandia conducted "no independent analysis to support his opinions" about licensed products (Mot. at 9:20-22, 10:10-15), but they again redact as "NOT RELEVANT TO MOTION" Mandia's testimony stating, "I want to clarify that answer. . . . It was not my task to look at licenses. However, I did look at what people gave me as license information." Compare Russell Decl., Ex. B (Mandia Depo.) at 196:20-197:3 with Cowan Decl., Ex. B (Mandia Depo.). Then, Mandia testified, "we took licensing information provided to us from Carlos Barradas . . . and we looked at the [SAP TN] customer-labeled [download] folders to see where the things in the customer-labeled folders aligned with the licensing that we had [for those customers]."13 Russell Decl., Ex. B (Mandia Depo.) at 348:19-349:9. Mandia also conducted a similar analysis using Defendants' "Download Request Forms," which, according to SAP TN, recorded products "that the customer stated it was licensed to download."14 Cowan Decl., Ex. A (Mandia Report) 209-11 & n.91. Using both the Oracle and the SAP TN sources, Mandia determined which downloads on SAP TN's servers fit or did not fit Defendants' admissions about what was "inappropriate." Id., 205-28. His conclusions about downloading "without At least one million of these downloads violated computer fraud laws, so were obviously "inappropriate" and "improper." See, e.g., Dkt. 762 (Order re Mots. for Partial Summary Judgment) at 24:21-23. 13 Barradas is "Senior Principal Critical Accounts" manager with "in-depth knowledge regarding the licensing of specific Oracle products." Cowan Decl., Ex. A (Mandia Report) 108. 14 Defendants criticize Mandia's reliance on the same customer representations SAP TN allegedly relied on for five years to download over 9 million files. See, e.g., Russell Decl., 17, 20 & Ex. M (Gray Report) at 41-42 (SAP TN relied on licensed product representations from customers.), Ex. P (Rog. 13) (downloads based on "licensed" products). 16 Case No. 07-CV-01658 PJH (EDL) 12 OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 regard to licensing" rely on this analysis as well as his review of other SAP TN evidence.15 Under these circumstances, the fact that Mandia did not visually inspect each of the voluminous underlying license agreements does not render his testimony inadmissible, or even unusual. It was proper for him to assume for the purpose of his analysis that the licensed product information he obtained from both parties was correct and would be proved up at trial. See Barefoot v. Estelle, 463 U.S. 880, 903 (1983) ("[Experts' opinions] need not be founded upon their own personal knowledge of [the] facts, but may be founded upon the statement of facts proved in the case.") (citing Spring Co. v. Edgar, 99 U.S. 645, 657 (1878)); Am. Booksellers Ass'n v. Barnes & Noble, Inc., 135 F. Supp. 2d 1031, 1038 (N.D. Cal. 2001) (permitting an expert "to base his expert opinion on evidence that will be proved by other witnesses at trial"). C. Mandia May Testify About "Cross-Use" and "Contamination" As implicitly conceded by Defendants' stipulation to "all liability on all claims," no Oracle customer license allows a customer to copy or use the software other than to support that particular customer. Mandia defined "cross-use" to mean the use of one customer's licensed Oracle materials to support another customer, and "contamination" to refer to a fix SAP TN provided to a customer that was the product of such cross-use. Cowan Decl., Ex. A (Mandia Report) at 54-55. Defendants concede that these terms "have a particular meaning in the context of this case and are intended to indicate whether certain copies or conduct fall within the scope of license rights" that is, the testimony using these terms is highly probative. Mot. at 2 n.3. Mandia's analysis showed that SAP TN's customer support involved extensive "contamination" by "cross-use" of Oracle software and support materials. Cowan Decl., Ex. A (Mandia Report) at 8, 292-305. He focused on these activities because Oracle contends (and Defendants concede) they are infringing.16 "Cross-use" and "contamination" factually describe 15 See, e.g., Russell Decl., Ex. B (Mandia Depo.) at 363:4-25 (relying on SAP TN employee John Ritchie's testimony), and 21 & Ex. Q (Ritchie Depo.) at 79:15-82:8, 118:15-119:11 ("[T]here's nothing within Titan that checks whether PeopleSoft CRM is licensed to that particular customer's credential that's being used. ... There is no checking whatsoever."). 16 Compare Dkt. 670 (SAP's Opp'n to Mot. for Partial Summary Judgment) at 12:16-25 (describing Oracle's motion as related to using "CDs to build environments for customers other than the customer from whom the CDs were obtained") with Russell Decl., 23 & Ex. R (Hearing re Mot. for Partial Summary Judgment) at 28:17-29:11 (counsel for Defendants (Footnote Continued on Next Page) 17 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 specific ways SAP TN used Oracle software. Mandia uses these terms to simplify and explain SAP TN's conduct to the jury. Defendants seek to preclude these helpful and probative descriptors by a meritless (frankly, nonsensical) attack on his qualifications and methodology.17 Qualifications. Mandia is eminently qualified forensically to piece together the copying and use of software across SAP TN's servers and/or eventually to a customer. See Sec. III.A., above. "Cross-use" and "contamination" are factual descriptors of the activities he investigated. Mandiant does not become less qualified to testify about those subjects when he uses words that Defendants dislike (but use themselves). Methodology. Defendants equate Mandia's definitions of "cross-use" and "contamination" with assumptions (supposedly supplied by counsel) and then argue Mandia did nothing to "verify" his "assumptions." Mot. at 12:4-9. However, Mandia's definitions are not assumptions, so there was nothing to "verify." Moreover, and though it does not matter for a definition, Mandia defined his terms based on many sources in addition to "conversations with counsel," including Defendants' own admissions and characterizations of their conduct. See, e.g., Russell Decl., Ex. B (Mandia Depo.) at 220:19-225:10 ("Almost every one of these definitions were terms we used for years. . . . it's an aggregation of many different things that came from multiple sources.") (redacted by Defendants as "NOT RELEVANT TO MOTION" at Cowan Decl., Ex. B). Defendants' methodological challenge is way off base.18 conceding "the specific conduct in the motion ... was infringement of the registration they put in the motion.") (emphasis supplied). 17 See Mot. at 5, exclusion request No. 6, 7:15-19, 14:6-18. Defendants do not include "crossuse" or "contamination" in the Fed. R. Evid. 403 section of their motion, likely because they use such words to describe the same activity, for the same reasons. See, e.g., Russell Decl., 3, 2425 & Ex. A (Depo. Ex. 1549) (one environment used for four customers is a "Cross-Use" environment.), Ex. S (Mot. to Dismiss Hearing) at 40:10-20 (defendants' counsel arguing, "cross-use is copying, providing it to someone else and using it for someone else it's a copy."), Ex. T (NextLabs Website) at 2 (SAP Certified Partner offering a product that helps prevent "cross-contamination" of software across multiple customers). 18 Defendants use the same flawed logic to challenge Mandia's use of these terms related to his reliance on Levy's statistics. Mot. at 14:9-18 ("Mandia cannot manufacture a reliable basis for his opinions on the volume and existence of `contamination' and `cross-use' by passing his own assumptions (provided by Plaintiffs' counsel) through Levy."). Defendants "manufacture" their argument by re-labeling Mandia's definitions as "assumptions." Moreover, Defendants cannot dispute Mandia's reliance on Levy's extrapolation of his data when Defendants expressly do not challenge the methodology or conclusions reflected by either expert's counts. Mot. at 1:19-22. 18 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 D. Mandia's Testimony Regarding Copied Material Covered by Oracle's Asserted Registrations is Admissible Defendants seek to exclude Mandia testimony related to Oracle's copyrights-in-suit in two ways. See Mot. at 5, exclusion requests Nos. 3 & 4. Their arguments lack force in light of their stipulation to "all liability" on Oracle's copyright claims, but both are also wrong. 1. Mandia Should Be Permitted To Testify That SAP TN's Copies Relate To The Registered Works In part to determine what software and support materials to count as relevant to his forensic analysis of Defendants' systems, Mandia made an informed assumption about which Oracle software products are covered by the copyrights-in-suit. Those products are listed in Tables 35 and 36 of his Report. Cowan Decl., Ex. A (Mandia Report) 45 (stating this assumption); see also Russell Decl., Ex. B (Mandia Depo.) at 453:14-454:2 (referring to 45 in explaining the assumption). They represent the baseline materials Oracle provided Mandia to define his search for copies within the 12+ terabytes of data on SAP TN's systems. Russell Decl., Ex. B (Mandia Depo.) at 455:3-457:3 ("I was looking for software and support materials that were listed in Table 36, and then different product lines and releases that were in Table 35."). Mandia's assumption that these products embody Oracle's Registered Works, now effectively conceded by Defendants' liability stipulation, was reasonable for a number of reasons, including Oracle's representation to him (to be proved up at trial) that the software it provided him was covered, and Mandia's confirmation of the product names with titles in the Registrations. Id. at 457:22-459:22. Again, that is what experts do. See Fed. R. Evid. 703 ("The facts or data ... upon which an expert bases an opinion ... may be those perceived by or made known to the expert at or before the hearing."); see also Fed. R. Evid. 104(b). After his extensive forensic analysis, Mandia applied his assumption of what Oracle will prove at trial to the copies of Oracle software he found on SAP TN's systems to form conclusions about which copies lined up with the Registered Works. When he found literal copies (for instance, exact code matches based on forensic MD5 hash comparisons), he concluded they were covered by the copyrights-in-suit. Cowan Decl., Ex. A (Mandia Report) at 373-374 (describing the three forensic approaches used to compare SAP TN's copies of Oracle 19 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 applications to the Registered Works), 376-377 (same for support materials). Defendants do not dispute Mandia's forensic investigation expertise to search for the materials in Tables 35 and 36 or the accuracy of his summary, or the correctness of his assumption. See, e.g., Mot. at 1:19-22. In fact, even before their stipulation to liability, Defendants had already largely conceded that Mandia's assumption is correct. See Dkt. 762 (Order re Mots. for Partial Summary Judgment) at 7:8-17 (granting summary judgment "[b]ased on defendants' concessions"); Dkt. 745 (Jt. Pretrial Statement) at 42-51 (undisputed facts re Oracle's Registered Works and SAP TN copies of same products and versions). Instead, Defendants complain that "Mandia opines that all 120 of the copyright registrations put at issue by Plaintiffs are implicated by his findings," and therefore infringed. Mot. at 9:23-24. Mandia did not say that, though he now could in light of Defendants' stipulation. Rather, Mandia's assumption, combined with his extensive experience, input from Lichtman and input from knowledgeable Oracle employees, led him to conclude the inverse: that "each SAP TN Environment or installation of Oracle Database" that matches a product listed in Table 35 contains protectable expression from a Registered Work. Compare id. with Cowan Decl., Ex. A (Mandia Report) at 373, 376; see also Sec. IV.E., below (no "infringement" in Mandia's Report). Even absent Defendants' stipulation, Mandia's testimony about the copies of Registered Works he found is admissible because it rests on reliable assumptions and facts to be proven at trial (now stipulated), and will assist the jury in untangling Defendants' massive infringement. Fed. R. Evid. 702, 703. The Court should reject Defendants' criticism of Mandia on these grounds. 2. Mandia Should Not Be Precluded From Offering Opinions With Which Defendants' Expert Disagrees Defendants also seek to prevent Mandia from testifying as to any Oracle software or SAP TN copies related to 55 registrations that Defendants' expert Gray asserts are not implicated by Mandia's Report. Mot. at 5, exclusion request No. 4 & 9:28-10:9. This issue is rendered inconsequential by Defendant's stipulation to "all liability on all claims" by SAP TN. Even if still of any importance, the fact that Defendants resort to Gray's interpretation of Mandia's 20 Case No. 07-CV-01658 PJH (EDL) OPPOSITION TO DEFS' MOTION TO PARTIALLY EXCLUDE TESTIMONY OF MANDIA AND LEVY 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 Report is enough to deny their request; it would have been, if anything, a battle of the experts. See Humetrix, 268 F.3d at 919 ("Authority to determine the victor in such a `battle of expert witnesses' is properly reposed in the jury."). Regardless, Defendants are wrong. Defendants ignore what were open questions of law in the case, now superseded by Defendants' liability stipulation, about whether infringement of a derivative work also infringes earlier registrations. See, e.g., Dkt. 745 (Jt. Pretrial Statement) at 75, 2-5. Moreover, Gray's report does not address registrations implicated by Defendants' recent (and late) production of hundreds of thousands of software and support materials and thousands of instant messages, which Oracle and Mandia are currently analyzing and are the subject of a potential sanctions motion with Judge Laporte. See, Dkt. 826 (Jt. Statement re Sanctions Mots.). For these reasons, the Court should deny Defendants' motion to exclude the list of registrations derived from Gray's characterization of Mandia's report. E. Mandia's Testimony Is Not Unduly Prejudicial Finally, Defendants seek to exclude multiple, significant aspects of Mandia's test

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?