Kilopass Technology, Inc. v. Sidense Corporation

Filing 323

ORDER REGARDING MOTIONS IN LIMINE 289 290 291 292 293 (Illston, Susan) (Filed on 9/28/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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KILOPASS TECHNOLOGY, INC.,

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United States District Court
For the Northern District of California

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No. C 10-02066 SI
No. C 11-04112 SI

Plaintiff,
ORDER REGARDING MOTIONS IN
LIMINE

v.
SIDENSE CORPORATION,
Defendant.

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On September 25, 2012, this case was scheduled for a final pretrial conference, for the jury trial

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set to begin October 9, 2012. All parties were represented by counsel. The pretrial conference was held

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in part and the balance has been continued to October 2, 2012 at 10:00 a.m..

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The Court previously granted Sidense’s motion for summary judgment in C 10-2066, resolving

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Kilopass’ patent infringement claims against Sidense. In addition, about a week prior to the pretrial

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conference, Sidense voluntarily dismissed its California tort claims against Kilopass in C 11-4112.

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Thus, the October 9, 2012 jury trial now concerns only three remaining causes of action by Kilopass

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against Sidense in C 10-2066: a Lanham Act/false advertising claim; an intentional interference with

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prospective economic advantage claim under California law; and an unfair competition claim under

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California law.

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The Court held a hearing on Sidense’s motions in limine at the September 25, 2012 pretrial

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conference. At the hearing, the parties stipulated that several of Kilopass’ motions in limine are moot

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because of Sidense’s recent dismissal of its business tort claims against Kilopass. Sidense v. Kilopass,

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Case No. 3-11-cv-04112, Dkts.115, 116.

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The Court makes the following rulings on various of the motions. The parties are directed to

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meet and confer prior to resuming the pretrial conference on October 2, 2012, to consider what, if

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anything, remains to be presented to a jury in this case.

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1.

Motion in Limine #1

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The Court GRANTS Sidense’s Motion in Limine #1 (Dkt. 289) and hereby excludes any

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evidence that Sidense’s patents do not cover its own technology, and in particular, excludes evidence

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regarding prosecution of Sidense’s ‘855 patent.
The crux of Kilopass’ false advertising claim is that Sidense falsely claimed that its own

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technology was covered by its own patents. Its Lanham Act/false advertisement allegation is that

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United States District Court
For the Northern District of California

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“Sidense has distributed into interstate commerce false and/or misleading statements . . . that falsely

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portray its products with the intent to materially affect the buying decisions of prospective customers.

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For example, Sidense has described in such advertisements that its so-called ‘1T-Fuse™ Logic NVM

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IP’ is patented.” Third Am. Compl. (“TAC”) ¶ 63. Relatedly, Kilopass alleges that “Sidense has been

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sowing deceit in the marketplace. For example, knowing fully of Kilopass’ patent rights, Sidense has

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falsely alleged in the marketplace statements to the effect that Kilopass has no intellectual property

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issues with Sidense . . . The intent behind this deceitful conduct is to create an impression that Kilopass

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authorizes Sidense’s illegal products.” TAC ¶ 24. With respect to the intentional interference with

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prospective economic advantage, Kilopass’ core allegation is that “Sidense has interfered with the

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business relationships of Kilopass by making false and misleading statements to Kilopass’ customers,

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partners, and prospective customers and partners . . .” TAC ¶ 60. On the unfair competition claim,

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similarly, Kilopass’ core allegation is that Sidense made “deceptive statements and advertisements” and

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induced Kilopass customers, partners, and prospective customers with “false statements and

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advertisements.” TAC ¶ 68.

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The gravamen of all three claims, and the only concrete “falsity” specified in the TAC, is that

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Sidense has falsely represented that Sidense’s patents cover Sidense’s products. See Maheshwari Decl.,

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Ex. 6: Sidense’s website states “Sidense’s patented 1T-Fuse™ Logic NVM IP”; then lists 40+ patents

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in Sidense patent portfolio. The foundation of all three of Kilopass’ tort claims is that Sidense

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“do[es]n’t have a patent on that . . . product.” Hearing Tr. 11:20.
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None of Sidense’s patents has been the subject of this litigation. There has been no claim

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analysis or construction concerning any of Sidense’s patents. Rather, the case has centered on Kilopass’

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patents and whether or not Kilopass infringed them. Now, to prove what is essentially a negative – that

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none of Sidense’s 40+ patents covers Sidense’s IP technology – Kilopass seeks to use the prosecution

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history of Sidense’s ‘855 patent. See Kilopass Opp. to Mot. in Limine #1 at 5-6. At the hearing

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Kilopass’ counsel asserted that Sidense’s founder Mr. Wlodek Kurjanowicz admitted at his December

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15, 2011 deposition that Sidense’s patents do not cover Sidense’s technology. See Hearing Tr. 11:13-15

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(“[W]hen we showed him the advertisements or showed him what everybody was being presented with,

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he said, no, we don’t have a patent on that product.”). Mr. Kurjanowicz was shown the ‘855 prosecution

United States District Court
For the Northern District of California

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history and allegedly admitted that Sidense did not have a patent on its own technology. Id.

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The scope of a patent’s coverage is a question of law for the court to decide. Markman v.

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Westview Instruments, Inc., 52 F.3d 967, 976 (Fed. Cir. 1995) (en banc) aff’d 517 U.S. 370 (1996).

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Whether Kilopass intends to present evidence that Sidense’s ‘855 patent does not cover Sidense’s

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technology or that none of Sidense’s patents covers any of Sidense’s technology or the 1T-Fuse™ Logic

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NVM IP technology at issue, the scope of Sidense’s patents is simply an inappropriate matter for the

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jury. Counsel for Sidense noted at the hearing that Sidense has an extensive patent portfolio consisting

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of at least 40 patents. Hearing Tr. 21:21-23. To prevail on any of these three tort claims Kilopass would

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be asking the jury to determine that Sidense’s claim that its patents cover its technology is false. In

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effect, that would mean the jury would have to determine the scope of all of Sidense’s patents, or at the

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least, the scope of the ‘855 patent. The parties are aware of the history of this case and the effort

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involved in patent claim construction. At no point in the prior two years of motions has Kilopass

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submitted any evidence concerning any of Sidense’s patents, nor requested this broad claim construction

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of all of Sidense’s patents.

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Reviewing the only other relevant evidence Kilopass points to simply does not support their

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assertion, nor does it get around the problem of having a jury determine patent scope. The Court

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reviewed the portions of Mr. Kurjanowicz’s deposition provided by Kilopass’ counsel1 and nowhere

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does Mr. Kurjanowicz admit that Sidense’s patents do not cover Sidense’s technology. In fact, in

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response to Kilopass’ counsel’s assertion that Sidense modified it’s patents to “get around” a Kilopass

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patent, Mr. Kurjanowicz stated, “I don’t think so.” Maheshwari Decl., Ex. 4, Kurjanowicz Dep. 135:5-

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17. Because Sidense makes a broad claim that its technology is patented, the jury would be forced to

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determine the ambit of some or all of Sidense’s patents.

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Having the jury consider any of the potentially relevant evidence Kilopass has pointed the Court

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to on this point–that Sidense’s patents do not cover Sidense’s technology–would substitute the jury’s

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judgment of the patents’ scope for that of this Court. To do so is incorrect as a matter of law. The Court

United States District Court
For the Northern District of California

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therefore excludes all evidence that Sidense’s patents do not cover its own technology.2

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2.

Motion in Limine #2

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The Court GRANTS Sidense’s Motion in Limine #2 (Dkt. 290) and hereby excludes evidence

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of allegations not included in Kilopass’ TAC. Defendant’s false advertising claim and related3

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intentional interference with prospective economic advantage and unfair competition claims must be

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plead with particularity pursuant to Fed. Rule Civ. Proc. 9(b). See Dkt. 50 at 10. Allowing Kilopass

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to add new allegations because it plead them generally in the TAC would not only violate 9(b)’s

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Kilopass’ Opposition to Motion in Limine #1 purports to attach Mr. Kurjanowicz’s deposition
excerpts at Exhibit 1 to the Declaration of Imran Khaliq in Support of Kilopass Technology, Inc.’s
Opposition to Sidense’s Motion in Limine #1-8. However, only the prosecution history of the ‘855
patents appears at Exhibit 1. The Court did find the apparently relevant excerpts of Mr. Kurjanowicz’s
deposition at Exhibit 4 to the Declaration of Shailendra Maheshwari in Support of Kilopass’ Opposition
to Sidense’s Cross-Motion for Leave to File a Summary Judgment Motion.
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Although the Court denied Sidense’s prior motion for leave to file a summary judgment
motion (Dkt. 300), the result of granting Sidense’s Motion in Limine #1 is that it is very unlikely that
any triable disputes of material fact remain.
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Kilopass’ intentional interference with prospective economic relations and unfair competition
claims are related to the false advertising claim because they too require a showing that Sidense violated
the Lanham Act. See BioResource, Inc. v. US Pharmaco Dist., Ltd., 2010 U.S. Dist. LEXIS 69836, *8
(N.D. Cal. July 13, 2010) (interference with prospective economic advantage claim requires conduct
that is “wrongful by some legal measure other than the fact of interference itself”); Cel-Tech Comms.
Inc. v. Los Angeles Cellular Tel. Co., 20 Cal. 4th 163, 180 (1999) (unfair competition claim under the
“unlawful” prong requires a borrowed law). Additionally, the Court has previously found that Kilopass’
unfair competition claim is limited to the “unlawful” prong of § 17200 and therefore the practices “that
form the basis of this claim consist of plaintiff’s other tort counts.” Dkt. 50 at 11.
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particularity requirement, but would also be prejudicial to Sidense at this late stage.

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3.

Motion in Limine #3

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The Court GRANTS Sidense’s Motion in Limine #3 (Dkt. 291) and hereby excludes hearsay

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evidence cited in Kilopass’ Interrogatory responses. Fed. Rule of Evidence 807's residual hearsay

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exception does not apply here, where the plaintiff has not shown that the veracity of the hearsay

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statements is uncontested. Even if the residual exception applies, plaintiff has not demonstrated that

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these statements bear any relevance to the crux of Kilopass’ false advertisement claim and related

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intentional interference with prospective economic advantage and unfair competition claims.

United States District Court
For the Northern District of California

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4.

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Motion in Limine #4
The Court GRANTS Sidense’s Motion in Limine #4 (Dkt. 292) excluding evidence that Sidense

infringes Kilopass’ patents or copied Kilopass’ patented technology, without objection.

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5.

Motion in Limine #5

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The Court GRANTS Sidense’s Motion in Limine #5 (Dkt. 293) and hereby excludes all evidence

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of Kilopass’ patents. The crux of Kilopass’ claims against Sidense revolve around Sidense’s alleged

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misrepresentations with respect to Sidense’s own patents. The existence and validity of Kilopass’ own

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patents is therefore irrelevant. To the extent it is relevant to disprove that Sidense’s patents do not cover

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Sidense’s technology, the Court has already address that issue supra; the scope of a patent is a question

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of law for the Court, not the jury.

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6.

Motion in Limine #6

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The Court DEFERS ruling on Sidense’s Motion in Limine #6 (Dkt. 294). Bonnie Smith’s

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damages expert report could be admissible if Kilopass is able to present the requisite underlying

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evidence at trial–to lay a factual foundation for liability on which Ms. Smith’s damages analysis rests.

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Motions in Limine #7 & #8
The Court DEFERS ruling on Sidense’s Motion in Limine #7 (Dkt. 295) and #8 (Dkt. 296).

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IT IS SO ORDERED.

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Dated: September 28, 2012
SUSAN ILLSTON
United States District Judge

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United States District Court
For the Northern District of California

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