Brilliant Instruments, Inc. v. GuideTech, Inc.

Filing 338

ORDER ON MOTIONS FOR JMOL, NEW TRIAL OR ADMINISTRATIVE RELIEF, TO STRIKE, FOR PRELIMINARY INJUNCTION, AND TO SEAL by Judge Claudia Wilken denying 322 Administrative Motion to File Under Seal; denying 324 Motion for Judgment as a Matter of Law; finding as moot 331 Motion to Strike; denying 330 Motion for new trial or administrative relief (cwlc2, COURT STAFF) (Filed on 8/22/2014)

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1 2 IN THE UNITED STATES DISTRICT COURT 3 FOR THE NORTHERN DISTRICT OF CALIFORNIA 4 5 GUIDETECH, INC., 6 No. C 09-5517 CW Plaintiff, 7 8 9 United States District Court For the Northern District of California 10 11 v. BRILLIANT INSTRUMENTS, INC., Defendant. ________________________________/ ORDER ON MOTIONS FOR JMOL, NEW TRIAL OR ADMINISTRATIVE RELIEF, TO STRIKE, FOR PRELIMINARY INJUNCTION, AND TO SEAL (Docket Nos. 322, 324, 330, 331) 12 13 14 After a trial held from March 31, 2014 to April 7, 2014, the 15 jury determined that Defendant Brilliant Instruments, Inc.’s 16 products infringe Plaintiff GuideTech, Inc.’s patent. 17 Brilliant renews its motion for judgment as a matter of law 18 (JMOL). 19 Brilliant. 20 asking the Court to grant a new trial on infringement of the 21 BI221, or to grant “administrative relief” and alter the jury’s 22 verdict on that product. 23 hearing. 24 counsel, the Court DENIES Brilliant’s renewed motion for JMOL, 25 DENIES GuideTech’s motion for new trial or administrative relief, 26 DENIES as moot Brilliant’s motion to strike, DENIES GuideTech’s 27 motion for preliminary injunction, and DENIES GuideTech’s motion 28 to seal. Now, GuideTech moves for a permanent injunction against After briefing was completed, GuideTech filed a reply On July 3, 2014, the Court held a Having considered the papers and the arguments of 1 2 BACKGROUND A. 3 Brief Background of the Patent and the Accused Products In 1998, Shalom Kattan founded Guide Technology, Inc., the 4 predecessor entity to GuideTech, which is in the business of 5 manufacturing and selling precision time and frequency measurement 6 instruments. 7 inventor for several patents asserted in this litigation. 8 Decl., Exs. 1-3, 12. 9 establish Brilliant, a one-man company comprised of Mr. Kattan Docket No. 35 ¶ 3. Mr. Kattan is the sole named Chin In 2004, Mr. Kattan left GuideTech to United States District Court For the Northern District of California 10 himself. 11 manufactures and sells measurement instruments. 12 4. 13 the patents at issue, to Ronen Sigura, who then founded GuideTech. 14 Chin Decl., Ex. 24. Id. at 42:12-25; Chin Decl., Ex. 9. Brilliant also Docket No. 39 ¶ 15 On May 23, 2008, Guide Technology sold its assets, including On November 20, 2009, Brilliant initiated this suit seeking 16 declaratory judgment that its accused products, including BI200 17 and BI220, do not infringe GuideTech’s patents. 18 concern time interval analyzers, testing instruments used in the 19 semiconductor industry to detect timing errors in integrated 20 circuits. 21 judgment of non-infringement and GuideTech filed a motion for 22 summary adjudication on the issue of assignor estoppel. 23 granted Brilliant’s motion for summary judgment, finding 24 Brilliant’s products did not infringe the patents-in-suit, and 25 denied GuideTech’s motion on assignor estoppel as moot. 26 Docket No. 137. 27 the Federal Circuit from the summary judgment order. 28 166. The patents In early 2011, Brilliant filed a motion for summary The Court See On October 4, 2011, GuideTech filed an appeal to Docket No. The Federal Circuit reversed the Court’s summary judgment 2 1 order and remanded, finding disputed issues as to whether 2 Brilliant’s products infringe the patents-in-suit under the 3 doctrine of equivalents. 4 GuideTech, LLC, 707 F.3d 1342, 1348-49 (Fed. Cir. 2013). 5 the case returned to the district court, the Court granted summary 6 judgment on the issue of assignor estoppel, barring Brilliant’s 7 invalidity case. 8 its claims based on two of the patents-in-suit, leaving only U.S. 9 Patent No. 6,226,231 (the ‘231 patent). United States District Court For the Northern District of California 10 11 B. Brilliant Instruments, Inc. v. After Shortly before trial began, GuideTech dropped Pretrial Conference On March 19, 2014, the Court held a pretrial conference and 12 heard arguments on motions in limine and pretrial motions. 13 pretrial conference, the Court required GuideTech to disclose to 14 Brilliant its theory of damages, including a narrative or chart of 15 the products for which profits were lost, when the profits were 16 lost, and cites to the record so Brilliant could check the 17 numbers. 18 37:22-38:16. 19 lost profits theory because, while GuideTech had no damages 20 expert, it had disclosed at least some evidence in support of the 21 theory. 22 not the proper vehicle for challenging the sufficiency of the 23 plaintiff’s case. 24 563 F. Supp. 2d 508, 532 (D.N.J. 2008). 25 GuideTech could “only present evidence it has disclosed to 26 Brilliant and must cite before trial where such evidence was 27 disclosed.” At the Docket No. 283 (Pretrial Conference Transcript) at However, the Court declined to exclude GuideTech’s Docket No. 276 at 1-2. A motion in limine is generally See Bowers v. Nat'l Collegiate Athletic Ass'n, Docket No. 276 at 2. 28 3 The Court ruled that 1 C. Trial - Infringement 2 On March 31, 2014, before jury selection, it became apparent 3 that GuideTech had failed pursuant to the Court’s pretrial orders 4 to disclose to Brilliant a narrative or chart describing its 5 damages calculations. 6 at 6:8-7:21. 7 chart. 8 timely disclosed to Brilliant, the Court sought to minimize 9 prejudice and costs to both sides by bifurcating the liability and Docket No. 299 (March 31, 2014 Transcript) At the Court’s request, GuideTech disclosed the Id. at 8:7-9:14; 12:4-16:20. Because the chart was not United States District Court For the Northern District of California 10 damages portions of the trial, which would allow Brilliant to 11 review GuideTech’s damages calculations. 12 13. 13 Id. at 18:11-15; 26:1- The jury first heard evidence on liability. After 14 deliberating, the jury returned a verdict finding that the BI200 15 and BI220 infringed claims 1, 2, 4, and 5, but could not agree on 16 infringement of claim 3. 17 BI221, the jury agreed that these products did not infringe any of 18 the asserted claims. 19 willful infringement. 20 Court could accept the incomplete verdict. 21 3, 2014 Transcript) at 466:10-14. 22 D. 23 Id. Docket No. 300. As for the BI201 and The jury did not find induced or GuideTech withdrew claim 3 so that the Docket No. 310 (April Trial - Damages On the following day, April 4, 2014, the jury heard the 24 parties’ respective positions on damages. 25 an expert to testify as to lost profits, but relied on its CEO, 26 Mr. Sigura, to testify as to lost sales and costs. 27 (April 4, 2014 Transcript) at 500. 28 through his experience managing GuideTech, he was familiar with 4 GuideTech did not have Docket No. 311 Mr. Sigura testified that, 1 both the market and GuideTech’s own sales and costs. 2 02. 3 infringing products in the sum of $5,754,567. 4 Brilliant likewise did not have a damages expert, but relied on 5 its CEO, Mr. Kattan, to rebut Mr. Sigura’s testimony. 6 Id. at 500- Mr. Sigura concluded that GuideTech had been damaged by the Id. at 523:8-9. Id. at 540. After the presentation on damages concluded, the jury began 7 deliberations. 8 lost profits based on GuideTech’s Femto 2000 and GT 568 products, 9 or whether it could consider lost sales of other products, such as The jury asked whether it was limited to awarding United States District Court For the Northern District of California 10 the GT 4000 which replaced the Femto 2000. 11 parties agreed that no evidence had been presented on the GT 4000, 12 so it could not be considered. 13 Court advised the jury that it was limited to the Femto 2000 and 14 GT 658, and it could not include the loss of sales of other 15 products in its calculation. 16 couple of more hours of deliberation, the jury passed a note 17 asking to speak to the Court. 18 frustration that the jury could not “come up with a decision.” 19 Id. at 596:5-9. 20 continue deliberating, and advising that if there was a problem 21 relating to the evidence, the jury should “study the jury 22 instructions again” to see “what needs to be proved and by whom.” 23 Id. at 596:12-22. 24 about it over the weekend and reconvene on Monday to continue 25 deliberations. 26 27 Id. at 592. Id. at 591:21-25. The Accordingly, the Id. at 594:25-595:1-2. After a The jury foreperson expressed The Court responded by asking the jury to The Court further instructed the jury to think Id. at 599:7-11. On Monday, the jury reconvened to deliberate for about five hours before delivering their damages verdict. 28 5 The jury returned 1 a verdict assessing damages for GuideTech and against Brilliant in 2 the amount of $342,229.23. 3 Docket No. 312, 605:6. 4 DISCUSSION A. Judgment as a Matter of Law 5 1. 6 The standard for evaluating a motion for JMOL is similar to Legal Standard 7 that of a motion for summary judgment, albeit at a later stage of 8 the proceeding. 9 (9th Cir. 1981). Lies v. Farrell Lines, Inc., 641 F.2d 765, 772 To prevail on a renewed motion for JMOL United States District Court For the Northern District of California 10 following a jury verdict, the moving party “must show that the 11 jury’s findings, presumed or express, are not supported by 12 substantial evidence or, if they were, that the legal conclusions 13 implied by the jury’s verdict cannot in law be supported by those 14 findings.” 15 1998). 16 “to support the jury’s conclusion, even if it is also possible to 17 draw a contrary conclusion.” 18 F.3d 1010, 1021 (9th Cir. 2008). 19 instructed and there is substantial evidence, then the court must 20 sustain the jury’s verdict. 21 as a whole, but disregard evidence favorable to the moving party 22 that the jury is not required to believe. 23 Valley Unified Sch. Dist., 251 F.3d 1222, 1227 (9th Cir. 2001). Pannu v. Iolab Corp., 155 F.3d 1344, 1348 (Fed. Cir. “Substantial evidence” means evidence that is sufficient Harper v. City of Los Angeles, 533 Id. If the jury was properly The court must review the record Johnson v. Paradise 24 2. 25 Brilliant contends that the jury’s verdict on infringement is Infringement 26 contrary to evidence that the BI200, BI201, BI220, and BI221 are 27 all equivalent for purposes of infringement, and thus that a 28 6 1 verdict that the BI200 and BI220 infringed is inconsistent with 2 one that the BI201 and BI221 did not. 3 As a preliminary matter, GuideTech argues that Brilliant 4 waived this issue. 5 Court gave both sides the opportunity to object to its proposed 6 verdict form, which asked the jury to decide infringement as to 7 each accused product, allowing them to find infringement of some 8 products but not others. 9 Transcript) at 369:14-21 (“THE COURT: Then I handed you that On the second day of the liability phase, the See Docket No. 303 (April 1, 2014 United States District Court For the Northern District of California 10 verdict form . . . It occurred to me that they could conceivably 11 find that at least that the 221 didn’t infringe, even if the 12 others did.”). 13 proposed verdict form was proper. 14 approved the verdict form, however, Brilliant did not know whether 15 GuideTech would present sufficient evidence to support its 16 allegations. 17 preclude its argument at JMOL that GuideTech failed to present 18 evidence showing that the two sets of products were distinct. Both Brilliant and GuideTech agreed that the At the time the parties Brilliant’s assent to the verdict form does not 19 GuideTech next maintains that Brilliant waived this argument 20 because it failed to raise it in its initial JMOL motion at trial 21 under Rule 50(a), and so it cannot renew the argument now under 22 Rule 50(b). 23 substantial evidence to support the jury's verdict is not before 24 this court unless the appellant, at the close of the evidence or 25 case, interposed a motion for directed verdict.” 26 Slemons Imports, Inc., 803 F.2d 1488, 1493 (9th Cir. 1986) 27 (internal punctuation omitted). 28 contention is unavailing. Fed. R. Civ. P. 50. The “ground that there was not Gilchrist v. Jim GuideTech’s second waiver The basis of this JMOL argument is 7 1 GuideTech’s alleged failure to meet its burden of proof, which 2 Brilliant raised in its initial JMOL. 3 Docket No. 303, 265:2-9. On the merits of the motion, GuideTech presents the testimony 4 of Mr. Kattan, designer of the accused products, to show that the 5 products are not distinct: 6 7 8 9 United States District Court For the Northern District of California 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Q: Couple of follow-up questions, Mr. Kattan. Do you know what the difference is between the brilliant instruments BI 200 and BI 201? A: The frequency range is lower on the 201. Q: And what structurally, if anything, is different about those products? A: Well, I’ll make it short for you. For the purpose of this discussion, it’s the same architecture. Q: Okay. So for purposes of this discussion, and I want you to be clear, this goes to the infringement analysis. Is the BI 200 the same as the BI 201 for purposes of infringement? A: It’s materially the same, yes. Docket April 1, 2014 Transcript at 335:16-336:3. When asked about the BI220 and BI221, Mr. Kattan stated they were substantially identical, but pointed out several differences, such as the use of a PXI bus as opposed to a PCI bus, the range of frequency, the components of the measurement circuit, a different prescaler, additional clocks, and different reference voltages. 336:11-343:12. Id. at When asked if any of those differences would affect infringement, he said he did not know for sure, but “probably not.” Id. at 341:24-342:1. Dr. West, GuideTech’s own infringement expert, then testified that the BI220 and BI221 were identical for purposes of infringement. Regarding Mr. Kattan’s testimony as to certain differences between the BI220 and BI221, Dr. West stated, “The very specific things that he mentioned, none of them would have anything to do with those -- those claims.” 28 8 Id. at 345:10-22. 1 Even if GuideTech’s infringement expert testified that the 2 products were identical for purposes of infringement, the jury 3 could properly have found that GuideTech failed to meet its burden 4 of proof of infringement by the BI201 and the BI221. 5 specifically analyzed, limitation by limitation, infringement by 6 the BI200 and BI220. 7 his testimony was by his own admission speculative. 8 acknowledged that he had not heard of the BI201 and BI221 at all 9 before the trial: United States District Court For the Northern District of California 10 11 12 13 Dr. West Regarding the BI201 and the BI221, however, He Q: Now, Dr. West, have you heard of a -- Brilliant Instruments’ BI221 product? A: I hadn’t heard of it until this case -- this trial. Q: Okay. What about the -- what about the BI201? Have you heard of that? A: Once again, I hadn’t heard of it until this trial. 14 April 1, 2014 Transcript at 247:7-17. 15 personal knowledge regarding the BI201 and BI221, and did not 16 analyze the products limitation by limitation, the jury could have 17 chosen to disregard his legal conclusion that the two sets of 18 products are identical for purposes of non-infringement. 19 Mr. Kattan pointed out several differences between the products, 20 the jury could have chosen to disregard his statement that the 21 products were identical, which was far from certain. 22 jury could have reasonably concluded that while GuideTech met its 23 burden of proving infringement by the BI200 and BI220, it failed 24 25 26 27 28 9 Because Dr. West lacked Because Thus, the 1 to do so for the BI201 and BI221. 2 reconcilable on this point.1 The jury verdict is 3 3. 4 Brilliant challenges the jury’s verdict awarding damages Damages because GuideTech failed to prove lost profits. 6 lost profits, GuideTech must prove that there is a reasonable 7 probability that the patentee would have made the infringer’s 8 sales “but for” the infringement. 9 Ltd., 296 F. Supp. 2d 1140, 1148 (N.D. Cal. 2003) (citing State 10 United States District Court For the Northern District of California 5 Indus., Inc. v. Mor–Flo Indus., Inc., 883 F.2d 1573, 1577 (Fed. 11 Cir. 1989)). 12 speculation, this court requires sound economic proof of the 13 nature of the market and likely outcomes with infringement 14 factored out of the economic picture.” 15 Am. Maize-Products Co., 185 F.3d 1341, 1350 (Fed. Cir. 1999). To be entitled to DSU Med. Corp. v. JMS Co., “To prevent the hypothetical from lapsing into pure Grain Processing Corp. v. 16 17 18 19 20 21 22 23 24 25 26 27 28 For the same reason that Brilliant’s argument regarding “identical” products is denied, GuideTech’s motion for new trial is DENIED. GuideTech’s motion is based on a April 21, 2014 statement by Brilliant’s CEO Mr. Kattan to a customer that the BI221 is identical to the BI220. GuideTech argues that this “new” evidence warrants a new trial under Rule 59. While Rule 59 permits a new trial on certain issues if new evidence comes to light, not any evidence will do. The movant must show (1) the probability that the evidence would have changed the outcome of the trial; (2) the evidence could not have been discovered earlier had the moving party been diligent; and (3) the evidence is not merely cumulative or impeaching. Advanced Display Systems, Inc. v. Kent State University, 212 F.3d 1272, 1284 (Fed. Cir. 2000). Here, Mr. Kattan’s statement is consistent with his testimony at trial. GuideTech’s own expert, Dr. West, stated the same opinion, although that opinion was ultimately not accepted by the jury. Accordingly, this information does not warrant a new trial. Brilliant’s request to strike this motion is DENIED as moot. 1 10 1 The Federal Circuit has adopted a four-factor test, which is 2 a useful but nonexclusive way for patentees to prove they are 3 entitled to lost profits: (1) demand for the patented product; (2) 4 absence of acceptable non-infringing substitutes; (3) 5 manufacturing and marketing capability to exploit demand; and (4) 6 the amount of profit that the patentee would have made. 7 Corp. v. Kelley Co., Inc., 56 F.3d 1538, 1545 (Fed. Cir. 1995) 8 (citing Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., 575 F.2d 9 1152, 1156 (6th Cir. 1978)). Rite-Hite An alternative to the Panduit test United States District Court For the Northern District of California 10 is the two-supplier market test. 11 requires the patentee to show: (1) the relevant market contains 12 only two suppliers; (2) the patentee has the marketing and 13 manufacturing capacity to make the sales that were lost to the 14 infringer; (3) the amount of profit that the patentee would have 15 made. 16 (Fed. Cir. 2003). 17 collapses the first two Panduit factors into one ‘two suppliers in 18 the relevant market’ factor.” 19 20 21 22 23 24 25 26 27 28 The two-supplier market test Micro Chem., Inc. v. Lextron, Inc., 318 F.3d 1119, 1124 a) “In essence, the two-supplier market test Id. Absence of acceptable non-infringing substitutes; two suppliers in the market Brilliant contends that GuideTech did not conduct an analysis of acceptable non-infringing substitutes. However, GuideTech’s CEO, Mr. Sigura, testified that in his years of experience in the field, he observed that were only two competitors in the market of high-frequency time interval analyzers -- Brilliant and GuideTech. This is evidence that there were no acceptable non-infringing substitutes and that the market consisted of only two suppliers. Although Brilliant points out contrary evidence, the Court cannot 11 1 weigh this against GuideTech’s evidence. 2 substantial evidence to support the jury’s finding on this factor, 3 the Court cannot substitute its judgment for the jury’s. 4 b) 5 6 Because there is Manufacturing and marketing capability to exploit the demand In its damages case, GuideTech claimed that but for 7 Brilliant’s infringement, it would have sold fifty-nine Femto 2000 8 products in 2009 instead of the one Femto 2000 it did sell. 9 4, 2014 Transcript at 527:1-12. April Brilliant argues that GuideTech United States District Court For the Northern District of California 10 failed to present evidence to the jury showing it had both the 11 manufacturing and marketing capacity to meet this demand. 12 Brilliant continues that GuideTech conceded that it did not 13 have enough employees to manufacture additional Femto 2000’s. 14 Prior to the infringement, GuideTech’s final assembly and testing 15 occurred in-house. 16 at the time of the infringement, GuideTech had no full-time, in- 17 house employees. 18 Sigura did everything himself: the day-to-day management, 19 production, sales and marketing, and shipping. 20 501:1-3. 21 been able to meet increased demand for Femto 2000’s. 22 Id. at 499:6-15. Id. at 500:21-25. But Mr. Sigura admitted that During this period, Mr. Id. at 500:21- Accordingly, Brilliant reasons GuideTech would not have As Mr. Sigura explains, however, GuideTech was unable to pay 23 full-time employees because of lack of business due to Brilliant’s 24 infringement. 25 infringement, GuideTech could have hired employees or contracted 26 others to meet demand. 27 have done so: Id. If it had not been for Brilliant’s Mr. Sigura testified that GuideTech could 28 12 1 2 3 4 5 Q: [. . .] Is it your -- Could GuideTech have made those sales? A: Absolutely. Q: And why do you say that? A: Because I can manufacture as many as -- as I get purchase orders. I mean, we have a manufacturing plant 15 minutes down the street, and they’ll be super happy if I give them an order for a thousand unit. That’s their livelihood. That’s our livelihood. So, yeah, I can make as many as -- there is demand for. 6 Id. at 512:25-513:8. 7 support a finding that GuideTech would have had the manufacturing 8 and marketing capacity if the infringement had not occurred. 9 United States District Court For the Northern District of California 10 c) Mr. Sigura’s testimony is sufficient to Accounting of the profit that would have been made Brilliant claims that GuideTech’s accounting is riddled with 11 numerous fatal errors. 12 “sound economic proof.” 13 In particular, Brilliant takes issue with the fact that GuideTech 14 used an average fixed cost of $368,760.00, computed from 2008 to 15 2010 data, and assumed that these fixed costs would be enough to 16 support the manufacture of fifty-nine Femto 2000’s instead of the 17 one Femto 2000 GuideTech did sell. 18 Calculations of damages must be based on Grain Processing Corp., 185 F.3d at 1350. Under the generally accepted incremental accounting approach, 19 fixed costs, or “costs which do not vary with increases in 20 production, such as management salaries, property taxes, and 21 insurance,” are excluded when determining profits. 22 Converting Mach. Co. v. Magna-Graphics Corp., 745 F.2d 11, 22 23 (Fed. Cir. 1984). 24 deducted from revenue to arrive at profit, but fixed costs need 25 not be deducted. 26 speculation or guess, it will be enough if the evidence shows the Paper Put another way, variable costs must be While “the damages may not be determined by mere 27 28 13 1 extent of the damages as a matter of just and reasonable 2 inference, although the result be only approximate.” 3 Id. According to Mr. Sigura’s testimony, GuideTech deducted both 4 fixed and incremental costs from revenue. 5 Transcript at 517-520 (explaining that he first calculated average 6 profit per product by subtracting incremental costs from revenue, 7 then deducted average annual fixed costs). 8 deducted more costs from revenue than was required by law, which 9 cannot justify granting JMOL in favor of Brilliant. United States District Court For the Northern District of California 10 April 4, 2014 GuideTech therefore Brilliant also contends that GuideTech improperly used data 11 from 2008 to 2010 to compute average fixed costs, ignoring data 12 from 2011 and 2014. 13 doing so: 14 15 16 But Mr. Sigura explained his reasoning for The actual fixed costs are a lot smaller because by that time, I didn’t have employees, I lost my admin -- I lost my one engineer that I had that I was paying measly salary, and I didn’t have any money to pay anybody. So my costs were down to nothing. We moved to a -- a low-cost facility . . . 17 Id. at 522:9-15. 18 2010 figure from his profit calculation, rather than the lower 19 2011 to 2014 figure incurred while his company was producing less, 20 in a low cost facility. 21 and more accurately depicts what would have occurred if Brilliant 22 had not infringed and GuideTech were able to produce more units to 23 meet demand. 24 is actually more favorable to Brilliant. 25 suggestion that litigation costs incurred by GuideTech from 2011 26 to 2014 should be deducted from revenue is unavailing because 27 GuideTech would not have incurred those litigation costs had it 28 not been for Brilliant’s infringement. In other words, he deducted the higher 2008 to This higher cost figure is conservative Thus, the choice to use the 2011 to 2014 cost figure 14 Separately, Brilliant’s 1 Overall, GuideTech presented sufficient evidence to sustain 2 the jury’s award of lost profits. 3 $342,229.23, which is less than six percent of GuideTech’s 4 requested sum, the jury could have done so because it doubted 5 GuideTech would have made all of the sales that it claimed it lost 6 to Brilliant. 7 different and not perfect substitutes. 8 as eight channels that can measure pulse width simultaneously, 9 while Brilliant’s products have only two channel devices that can Although the jury awarded This is not surprising because the products are The Femto 2000 has as many United States District Court For the Northern District of California 10 only make one pulse width measurement at a time. 11 The pricing of the two products is different. 12 The jury could have concluded that, because of the greater scale 13 and higher price of GuideTech’s products, only some of the demand 14 for Brilliant’s products would translate into demand for 15 GuideTech’s products. 16 B. Id. at 498:6-11. Id. at 518, 551. Permanent Injunction 17 1. 18 A plaintiff seeking a permanent injunction barring patent 19 infringement must demonstrate that four factors are present before 20 the court may grant such relief: (1) it has suffered an 21 irreparable injury; (2) legal remedies, including monetary 22 damages, are inadequate; (3) the balance of the hardships between 23 the plaintiff and the defendant weighs in favor of granting an 24 injunction; and (4) the public interest would not be impacted 25 negatively by an injunction. 26 547 U.S. 388, 391 (2006). Legal Standard eBay Inc. v. MercExchange, L.L.C., 27 28 15 1 2. 2 The “issues of irreparable harm and the adequacy of remedies Irreparable Injury and Inadequacy of Legal Remedies 3 at law are inextricably intertwined.” 4 v. Verizon Comms., Inc., 694 F.3d 1312, 1337 (Fed. Cir. 2012). 5 After eBay, there is no presumption of irreparable harm upon a 6 showing of patent infringement. 7 irreparable injury, a patentee must prove that (1) absent an 8 injunction, it will suffer irreparable harm and (2) there is a 9 sufficiently strong “causal nexus” connecting the alleged harm to ActiveVideo Networks, Inc. Id. at 1341. United States District Court For the Northern District of California 10 the alleged infringement. 11 To prove Ltd., 735 F.3d 1352, 1360 (Fed. Cir. 2013). 12 Apple Inc. v. Samsung Electronics Co., As a preliminary matter, GuideTech conducts no analysis of 13 whether there is a causal nexus between the infringement and the 14 alleged irreparable harm. 15 must show “that the infringing feature drives consumer demand for 16 the accused product.” 17 a time interval analyzer, the infringing products might include 18 other popular benefits that contribute to demand. 19 To establish a causal nexus, GuideTech Id. at 1364. While the ‘231 patent covers GuideTech argues that it will continue to lose good will, 20 market position, and revenue absent an injunction. 21 arguments in this regard are speculative because they offer little 22 more than attorney argument in support. 23 sales in the past, without more, is insufficient to show that 24 GuideTech is likely to lose sales and market share due to 25 Brilliant’s infringing conduct in the future. 26 that the opposite is true. 27 selling the infringing products, instead focusing on the non- 28 infringing ones. GuideTech’s Evidence of loss of some There is evidence Brilliant shows that it is no longer GuideTech presents no compelling evidence 16 1 establishing otherwise. 2 market position to non-infringing products, then that harm is not 3 sufficiently tied to the infringement and does not justify 4 injunctive relief. 5 If GuideTech were to lose good will or GuideTech also cannot argue that loss of exclusivity 6 justifies an injunction. 7 to a third party, TimeMetrics. 8 willingness to license indicates that legal remedies, such as 9 money damages, would be adequate to compensate GuideTech. In 2011, GuideTech licensed its patents Docket No. 235, 13:13-15. This United States District Court For the Northern District of California 10 3. 11 The balance of the hardships involves the consideration of Balance of the Hardships 12 “the relative effect of granting or denying an injunction on the 13 parties” with regards to the parties’ sizes, products, and revenue 14 sources. 15 862 (Fed. Cir. 2010). 16 i4i Ltd. Partnership v. Microsoft Corp., 598 F.3d 831, GuideTech asserts that its patents cover the cornerstone of 17 the products it manufactures, and so its entire business rests on 18 this injunction. 19 injunction, other companies will likely be encouraged to infringe 20 GuideTech’s patents, causing it harm. 21 speculative and conclusory. 22 alleged to continue in the future is tied to Brilliant’s 23 infringing activity. 24 protecting GuideTech from any competition, regardless of whether 25 it is infringing, solely because it may harm GuideTech’s business. GuideTech also states that if it does not get an These arguments are again GuideTech has not shown that the harm The Court cannot issue an injunction 26 4. 27 “The touchstone of the public interest factor is whether an 28 injunction, both in scope and effect, strikes a workable balance Public Interest 17 1 between protecting the patentee's rights and protecting the public 2 from the injunction’s adverse effects.” 3 F.3d at 863. 4 i4i Ltd. Partnership, 598 GuideTech argues that consumers “need clear direction from 5 this Court so that they will not unwittingly purchase infringing 6 products.” 7 The public has already been notified by judgment entered in this 8 case. 9 Docket No. 322-5 at 10; see also Docket No. 327 at 22. GuideTech further argues that, because GuideTech has the United States District Court For the Northern District of California 10 capability to serve the market even if Brilliant ceased to exist, 11 the public will still benefit from the technology embodied by the 12 ‘231 patent. 13 provide differing utilities to the public. 14 shown that the public interest would be served by issuing an 15 injunction. 16 The two products are different, however, and may GuideTech has not In sum, GuideTech has not proved that any of the eBay factors 17 weigh in favor of granting a permanent injunction. 18 C. 19 Motions to Seal GuideTech moves to seal portions of its motion for permanent 20 injunction and supporting exhibit, the deposition of Mr. Kattan. 21 GuideTech asserts they include information designated by Brilliant 22 as “Highly Confidential.” 23 filed a supporting declaration as required by Civil Local Rule 24 79-5(e). 25 See Docket No. 322. Brilliant never The motion to seal therefore must be DENIED. If it is obvious that the information was accidentally 26 overdesignated and should not be sealed, as a matter of common 27 sense, the parties should confer before filing an unnecessary 28 motion to seal. If the motion has already been filed, then the 18 1 designating party may file a declaration withdrawing its 2 designation for purposes of the motion. 3 parties the trouble of drafting an unnecessary motion and the 4 Court the trouble of reviewing it. 5 6 This would save the CONCLUSION Brilliant’s motion for JMOL (Docket No. 324) is DENIED 7 because the jury was properly instructed, there is sufficient 8 evidence to support the verdict, and the verdict is not 9 irreconcilably inconsistent. United States District Court For the Northern District of California 10 GuideTech’s motion for new trial or administrative relief 11 (Docket No. 330) is DENIED because the claimed new evidence is 12 cumulative. 13 (Docket No. 331) is DENIED as moot. 14 15 Brilliant’s motion to strike that motion as untimely GuideTech’s motion for a permanent injunction (Docket No. 322) is DENIED for failure to show that the eBay factors are met. 16 GuideTech’s motion to seal (Docket No. 322) is DENIED. 17 GuideTech shall file unredacted versions in the public docket no 18 later than seven days after the issuance of this order. 19 IT IS SO ORDERED. 20 21 22 Dated: 08/22/2014 CLAUDIA WILKEN United States District Judge 23 24 25 26 27 28 19

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