The Facebook, Inc. v. Connectu, Inc et al

Filing 684

Transcript of Proceedings held on 01/16/08, before Judge Richard Seebog. Court Reporter/Transcriber Kelly Bryce, E-mail [e-mail] Telephone number [phone]. Tape Number: FTR 2:40-3:29. Per General Order No. 59 and Judicial Conference policy, this transcript may be viewed only at the Clerks Office public terminal or may be purchased through the Court Reporter/Transcriber until the deadline for the Release of Transcript Restriction.After that date it may be obtained through PACER. Any Notice of Intent to Request Redaction, if required, is due no later than 5 business days from date of this filing. Release of Transcript Restriction set for 5/26/2009. (Bryce, Kelly) (Filed on 2/27/2009)

The Facebook, Inc. v. Connectu, LLC et al

Doc. 684

Pages 1 - 39 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA Before The Honorable Richard Seeborg, Judge The Facebook, Inc., et al., Plaintiffs, VS. ConnectU, Inc., et al., Defendants. ) ) ) ) ) ) ) ) ) )

NO. C 07-1389 RS

San Jose, California Wednesday, January 16, 2008 TRANSCRIPT OF PROCEEDINGS OF THE OFFICIAL ELECTRONIC SOUND RECORDING APPEARANCES: For Plaintiffs: Orrick, Herrington & Sutcliffe LLP 405 Howard Street San Francisco, California 94105 SEAN ALAN LINCOLN ATTORNEY AT LAW

BY:

(APPEARANCES CONTINUED ON FOLLOWING PAGE)

Reported by:

Kelly L. Bryce, Court Reporter Pro Tem

Computerized Transcription By Eclipse

Dockets.Justia.com

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APPEARANCES:

(CONTINUED) ORRICK, HERRINGTON & SUTCLIFFE 1020 Marsh Road Menlo Park, California 94025 MONTE M.F. COOPER THERESA ANN SUTTON ATTORNEYS AT LAW

For Plaintiffs:

BY:

For Defendants: 7 8 9 BY: 10 11 For David Gucwa: 12 13 BY: 14 15 16 17 18 19 20 21 22 23 24 25 DECHERT LLP 2440 W. El Camino Real - Suite 700 Mountain View, California, 94040 VALERIE MARGO WAGNER ATTORNEY AT LAW Finnegan, Henderson, Farabow, Garrett & Dunner LLP Stanford Research Park 3300 Hillview Avenue Palo Alto, California 94304 SCOTT RICHARD MOSKO ATTORNEY AT LAW

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Wednesday - January 16, 2008

2:40 p.m.

THE CLERK:

Calling Case Number C 07-01389 RS,

Facebook versus ConnectU. MR. LINCOLN: Good afternoon, Your Honor. Sean

Lincoln on behalf of Facebook. THE COURT: Good afternoon. Along with me is Monte Cooper and

MR. LINCOLN: Theresa Sutton. THE COURT:

Good afternoon. I apologize on behalf of

MR. LINCOLN:

Mr. Chatterjee who is unavoidably out of town. THE COURT: MS. WAGNER: Gucwa. THE COURT: MR. MOSKO: Good afternoon. And good afternoon, Your Honor. Scott That's all right. Valerie Wagner for defendant, David

Mosko for the remaining defendants. THE COURT: Good afternoon. I did spend

Let me give you a couple of comments.

some time reading the Case Management Conference Statement, and I know also that we have some motion issues as well and I read through those papers. So why don't you just go ahead and sit down. Let me

just run through a few general comments and then we can take

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this up.

Probably the order that I would suggest is we'll take

up the questions regarding the motion that's outstanding and then we can talk about some case management issues. They tend

to, as you will see, at least in my mind, they merge to some extent. So we'll see as I go through this. Let me first give you some guidance with respect to setting of the trial date. There's a lot of discussion back

and forth in the papers about Facebook asking for the summer and ConnectU talking to me about the Olympics and other things. We don't need to get there because I can't try this case in the summer. The summer is full. So what we're going to be looking at is some date later this year at the earliest. go into '09. I know ConnectU wants it to

I'm inclined to shoot for some time toward the

end of this year, and I think what I'm going to do is throw it back to you to come up with a schedule, propose at least some, my hope is, stipulated schedule with the guidance from me that I want it to be in the late fall of this year. Let me touch on a couple of other issues, general issues. There is some suggestion in the joint statement by the

Facebook side that they've got some discovery disputes and do I want to just deal with those. And the answer is, no. I

want -- I don't want to deal with discovery issues on the fly in a case management context. I may or may not have a hearing

on motions when they get filed, but I want to see something in

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writing so I know what the issue is rather than just have you start doing it on an informal discussion basis. I have used that mechanism from time to time and, at least in my personal experience, it seems to create more problems than it solves, sometimes because there's always some uncertainty about sometimes what the specific dispute is and then what the judge's -- the scope of the judge's read is on it. And I want at least at the outset to know what the dispute So I'm not proposing to

is about in some sort of written form. deal with those issues today.

With respect to a settlement conference, I am inclined to want to send you forth to some ADR process. I know What

we have the issue of related litigation, this litigation.

the ADR process will entail, I'm not sure I -- I'll want to talk to you about that, but I think it is a circumstance in which sooner rather than later I want some ADR to be undertaken; and, as I say, we can discuss what form that will take and to whom that will be directed. With respect to discovery limits and the like, when the parties start to have disagreements, just forwarning, I tend to fall back on the Federal default limits; and, so, that usually is going to win out. So when there's a proposal to

let's do this by hours instead of, you know, total hours versus particular limits on particular depositions, and the like, I tend to go back to the basic, I think, workable Federal limits

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and, perhaps, tweak them a bit but not do some other approach. Okay. Let me bring up an issue that's not in your

papers but it's -- and I know it's always frustrating for the parties and I've been there when I was in practice, sealing of documents. I am very concerned that I am getting, on virtually

every submission in this very papered case, I'm getting requests to seal everything. And thus far, I have been, I

think, fairly -- I've been willing to approve the parties' requests generally. Henceforth, you're forewarned they need to be much more specific and much more limited. I can tell you there's an

active discussion amongst the judges in the Northern District, some of whom -- I spoke recently with Judge Hamilton and she said, "I'm denying all of them. I think it's outrageously

overbroad what people are asking to seal and I'm denying them all." And I am not proposing I'm going to do that, but I share her sentiment that it's out of control. And, so, I know

everybody thinks it's the keys to the kingdoms that they have, but documents that are five years old or that sort of thing, you're going to have to really jump through hoops to show me they ought to be sealed. So you are forewarned. I'm not

proposing that people are going to need to resubmit anything that's already been submitted, and it's more of a going forward piece of advice to all of you.

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Okay.

With respect to the motion issue, the summary

judgment motion that Facebook has filed and then the request by ConnectU for sort of an interim ruling on their 56(f) argument, my sense of that -- and I'll certainly let you address it, Mr. Mosko -- but I don't want to do this on a piecemeal basis. The standard which I think works just fine is, if there's a 56(f) argument, it's ordinarily made in the alternative: We oppose summary judgment for these reasons; but

in the event we don't prevail on that, we think under 56(f), that we need to do these specific pieces of discovery in order to get the case in a posture that it can be ruled on. And,

so -- but I am disinclined to take up the 56(f) part of the opposition first, give you a read on that, and then have you go into any kind of other more substantive objection you have. With respect to the schedule, however, of the pending summary judgment motion, that's going to be kicked back. What I'm proposing to do is to kick it about two weeks So that would probably result in moving

back to February 27th.

all the dates -- the opposition dates and the reply dates -back a commensurate period of two weeks, which in some sense addresses, perhaps, one issue that I suspect ConnectU has, which is, if they're put to filing a full opposition, they need a little more time, and that would accommodate that. I need to

move it in any event, so it's not being moved to adjust for that particular issue.

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Okay.

Those are a bunch of general comments.

So

I'm going to turn it over to the parties.

So why don't you

come on up whoever wants to address these issues. MR. LINCOLN: Thank you, Your Honor.

I would like to add to our agenda of discovery disputes, not in order of importance but to make sure that we have on our agenda, a couple of other items. protective order. THE COURT: The protective order, yes. Again, it's not an issue of One is the

MR. LINCOLN:

contention, I believe, so I bring that up first. THE COURT: Yes. Thank you. I did see that. You

say there's been a protective order in State Court; and if you agree to it, I suspect I will have no problems with it. probably submitted it to me in the past. it, I would appreciate it. Remember though, and it goes, again, to the sealing question, you have been addressing 79-5, our Local Rule, and you've been dealing with that appropriately. That I would want You

If you would resubmit

to have in the protective order, that 79-5 is the governing procedure for requesting the documents in the court file be sealed. And, again, I don't have a recollection, I may have seen your particular protective order before; but keep in mind that if there's anything in there that essentially says --

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that's contrary to this notion of 79-5, that we can keep everything under seal in the courthouse, that's not going to fly. So I haven't seen it. With that exception, I'm sure I So if you want to resubmit it,

won't have a problem with it. that's fine. MR. LINCOLN:

If I can explain what occurred.

When

the defendants removed the case, of course, the process of removal required us to submit all the previous documents that existed in the Superior Court here to the Federal Court. And, I

so, in terms of submitting it, that's how it got submitted. would be surprised if that's something that the Court specifically looked at. THE COURT: Okay.

MR. LINCOLN:

That's why I think we raised it in the

joint Case Management Conference Statement, that we've been operating under as though it were a Federal submitted protective order; but what I propose, as we've done it before, is that plaintiffs prepare a draft protective order, we'll make whatever comments, and I suspect we'll reach an agreement, and then submit it to you for -- as a proposed order. THE COURT: MR. MOSKO: THE COURT: That's fine. That sounds reasonable. I assume there's a protective order in

the Massachusetts action; right? MR. LINCOLN: Yes, certainly.

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THE COURT:

Is that going to be -- I mean, we have Are

materials that are from that litigation this litigation. they going to be consistent? MR. LINCOLN: I wouldn't want to -- yeah.

So the parties have agreed that the

discovery that has occurred in Massachusetts can apply in California and vice versa. THE COURT: Okay. Certainly there is a protective order

MR. LINCOLN: in Massachusetts.

It is a bit different than the one, I

believe, Judge Trumbull has submitted, and I think that's the one that's currently on the Web site, the court's Web site, as a proposed order. THE COURT: Yeah. That's just by way of an example.

That's not in any way a mandated form that we expect, so... MR. LINCOLN: simplest thing is -THE COURT: Okay. That's fine. We'll take a look at it. I think the

MR. LINCOLN:

-- to take what we've already been

using and living by in State Court -THE COURT: I think that's fine. -- and make sure that it doesn't

MR. LINCOLN:

violate Rule 75(f) and make sure that that's expressly called out -THE COURT: Okay. -- and submit the rule. If there's

MR. LINCOLN:

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something else we need to talk about, we can resolve that. MR. MOSKO: That works. Another item for -- and we seek the

MR. LINCOLN:

Court's guidance, and that is two clerical errors in our prayer and we would like to -- we could submit a request to amend but that seems burdensome. THE COURT: My suggestion on this, so we don't have

amended, second amended, or third amended, but I would suggest -- and you can do it any way you want -- is to say: "Corrected Second-Amended Complaint." I mean, all you're doing

is correcting what, as it's been characterized to me, unless you have some problem with it, Mr. Mosko, it sounds like these are just typos effectively. MR. MOSKO: In general I don't have any problem.

I'd like to take a look at it -THE COURT: MR. MOSKO: don't anticipate that. THE COURT: Okay. Well, assuming that that is what Okay. -- a little bit more specifically, but I

they are, then I would suggest you just file a corrected Second-Amended Complaint. MR. LINCOLN: And as long as that's acceptable to

Your Honor without making a motion for leave to do so -THE COURT: That's fine with me. -- we'll run a draft by them and

MR. LINCOLN:

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submit it to you as soon as we can. MS. WAGNER: that again or just -THE COURT: No. That's why I wanted to use the term Would the defendants need to answer

"corrected" as opposed to "amended." MS. WAGNER: THE COURT: Right. If it's a new amendment, then I think

the argument is we've got to start over the whole process again, at least technically, and you're just making -- assuming that when you see it, you agree with that characterization, that it's just -- if it says "Corrected Second-Amended Complaint," it won't trigger any new responsive pleadings. MR. LINCOLN: It is not our intention to trigger any

need for further responsive pleadings. THE COURT: Right. For trial dates, Your Honor, coming to

MR. LINCOLN:

the points that you have raised first. THE COURT: Yes. I understand Your Honor having the

MR. LINCOLN:

limitation of not being able to try something in the summer certainly is what it is. If, however, we are going to be moved past, because of at least in part of the defendants' request -- now I've got to be more specific -- the Winklevoss' requests. defendants here. They are not

They worked hard to not be defendants here.

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THE COURT:

That's true. In all fairness, I think it is

MR. LINCOLN:

reasonable that those parties in the other action not then be seeking a trial date before this one in Massachusetts. Otherwise, we're going to end up with another set of claims, and we're not even at issue in that case; but I'm concerned about how we're going to then turn around and have a problem in Massachusetts. THE COURT: Well, I'm not going to weigh into any

strategy issues in terms of what other parties are positioning themselves for trial date purposes. I mean, the reason that

it's not going to be tried in, you know, July and August is -I mean, I'm not reaching the question of whether or not these particular witnesses' Olympic hopes are the reason -- that's not why it's being moved. I don't know whether or not -- I'm not saying that that isn't, you know, a significant event that I wouldn't take into account, but it's somewhat academic because I can't try the case in July and August, so the Olympics will have come and gone. Now, whether or not the, you know, trial date here is before or after Massachusetts, I mean, all I can tell you is that I'm inclined to think, you know, the case can be tried in '08; but beyond that, I mean, I'm not going to get involved in which one goes first. I'll give you a trial date and you can,

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you know, do whatever you want to do in Massachusetts; but I mean, I'm not going to position this case one way or the other with respect to the date of a trial in Massachusetts. for you guys to fight about. MR. LINCOLN: THE COURT: Okay. Next issue was the -That's

By the way, though, so we don't -- you

know, there are many moving parts and I do want to address this. On this question of these particular witnesses, I do think that, in terms of availability for discovery, that it is not going to be an argument that we have to practice eight hours a day until the Olympics, so there's no way -- I don't know whether or not these depositions are a part of the package in this case; but I don't want you to assume because I said it might have an impact on the trial date, if my schedule was otherwise available, I'm not saying I've determined whether or not that's a basis on which they're precluded from any involvement in the case. I mean, I assume they take a day off

here and there, so I don't know. MR. MOSKO: THE COURT: MR. MOSKO: May I address that? You may. I anticipated you were going to ask that

question and I'm prepared to respond with respect to what their schedule is so you understand. They practice seven days a week. In most instances,

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they practice -- they have two actual workouts a day; one in the morning that starts at about 8:00 o'clock that goes for somewhere in the nature of two to two and a half hours, then they break, then they have an afternoon comparable workout. They're single-man athletes; that is, this is the boats where -- these are the boats where they only row one oar, not that that makes too terribly much difference. THE COURT: MR. MOSKO: One person rowing two oars or -No. A person rowing one oar. There's an So there

is three boats where they are competing. eight-person boat -THE COURT: MR. MOSKO: Yes.

-- there's a four-person boat, and Each person is rowing one oar. All right.

there's a two-person boat. THE COURT: MR. MOSKO: THE COURT:

Okay. Okay.

So their unavailability would disrupt

the general overall practice of the boat? MR. MOSKO: THE COURT: MR. MOSKO: So -Okay. Yes. In terms of they practice seven

days a week, there are either one or two days, I believe, where they have an afternoon off. So they'll have -- in those

instances they'll have a schedule where they workout in the morning between 8:00 and 10:30, or whatever, and then they'll

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have an afternoon off.

So that's what's going on right now.

In, I believe, April there are trials that they call them -- and I hesitate to use that word, but that's what they call them -- where there is, in effect, a competition, which, I understand, which will effectively determine who the two -- who the members of the two-man boat will be; and then the current coach will determine, perhaps based on the trials, perhaps based on other things, will determine who will be rowing in the four-person boat and who will be rowing in the eight-person boat. So that what I'm told is, is that their schedule will only increase between now and those trials, and then will continue on through the Olympics. THE COURT: academic point. Well, let me -- maybe this is an

Mr. Cooper, is it your plan that you want

to -- of these two witnesses that you're going to -- again, I don't particularly want to weigh into discovery disputes right now, but are these people you want to take their deposition between now and whenever this can be done? MR. LINCOLN: This is Mr. Cooper. THE COURT: I'm sorry. I have no problem with you addressing Yes, Your Honor. And I'm Mr. Lincoln.

MR. LINCOLN: questions to Mr. Cooper.

The answer is, yes, absolutely.

We've noticed

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depositions.

And I don't want to respond here to a point which

that haven't had yet, which is we should be able to work out some dates. It just can't be the case that we can't get a

deposition day in for each of the guys in the next four months or the next two. THE COURT: Well, okay. I'm very skeptical that

they're -- just what Mr. Lincoln has said, that that can't be done. Now, I understand that if it's more than a part of the day or whatever, it becomes a bit more problematic; but I just can't believe that there isn't a point in time where they can't have -- they can't be deposed, but we'll -- is this -are they for sure they're going to go all the way through? mean, is it like they're competing to get a slot to then compete in Beijing or are they for sure doing this? MR. MOSKO: There are 25 people in the Olympic -- on I

the Olympic team, and they may not call it an Olympic team yet -THE COURT: MR. MOSKO: positions. THE COURT: MR. MOSKO: THE COURT: MR. MOSKO: Twelve slots, okay. Yeah. Okay. Okay. They were Okay. -- and they are competing for those 12

So that's what's going on.

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selected to be in this group who will then compete. THE COURT: And you told me, I think. What's the

date that they find out if they're in the 12? MR. MOSKO: Well, as I said, I believe it's either

late March or April where they have these trials, but I don't want to give the Court the impression that the trials will determine -- shortly thereafter, that will determine who will be in the eight- or the four-person boat. determines who is in the two-person boat. THE COURT: Well, does it determine who's not going I think that

to be going to the Olympics? MR. MOSKO: No. That is whatever happens in these

trials, then the coach, I believe his name is Coach Teti, then he will make the decision. is. What they do in these trials, this late March or April trial, is they row two-person boats; and, so, as I understand the process, the coach could pick one from one boat and one from another boat depending on the circumstances. a complicated -THE COURT: And after I said that the Massachusetts It's It's not clear when that decision

case sort of does its own thing, which is my general view, are they -- I mean, they can't have the position that they're available to do activities related to the Massachusetts action but somehow their training schedule is such that it precludes

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them from involvement in this action. And I recognize that they are not parties in this case because we went through that issue at some length but they are, certainly from what I know of the case, witnesses of some consequence in this case. MR. MOSKO: the schedule was -THE COURT: MR. MOSKO: schedule was. If the demand in terms of discovery, for example, is, "No, we want them for eight hours on Tuesday," then I think we have a problem with that. If, as I said, they're willing to Yeah. -- and I was explaining what the So they can't have it both ways.

And I don't believe -- you asked me what

work with us and, you know, we say, "We can give you two hours on Thursday because that's the day of their -- that's the day of the afternoon they have off," then I'm confident that we can work with that. THE COURT: MR. MOSKO: Okay. I am not of the belief or the

understanding, although I am not involved in the Massachusetts case, I'm not of the understanding that there's a position, a contention, that they can't do things in either case. THE COURT: MR. MOSKO: give it to you. All right. Okay. Well, then -I wanted to

You asked me the schedule.

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THE COURT:

Well, the first point of involvement I mean, I won't

here is to see if you can work something out.

weigh further into this particular issue until I see whether or not there's a dispute. MR. LINCOLN: THE COURT: We've noticed depositions.

Okay. We've been told, as I understand it, We've got nothing else, unless

MR. LINCOLN:

that those dates won't work.

what this was was an oral motion for protective order until September, which I don't think it was. THE COURT: I didn't interpret it that way. Then we would hope that they can work

MR. LINCOLN:

it out, find us some time, and we'll proceed. THE COURT: Okay. Just as some guidance, I mean, I I would be

would want to have the parties work it out.

inclined to think that it's workoutable, meaning that there's got to be some point in time where they're available, but I would also expect some, you know, some understanding on those who want to take the deposition that there is a somewhat unusual situation. Okay. Thank you. Let's move on to other issues. Discovery issues, you stated very

MR. MOSKO: THE COURT:

MR. LINCOLN:

clearly that you're not inclined to just wing it here today, if I may characterize what you said.

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THE COURT:

That's a fair characterization. But I would still propose that it

MR. LINCOLN:

would have great value to the parties indeed and accordingly would be very efficient if there could be a date some time in the near time future where we could get Your Honor something in advance of such a meeting and have a discovery conference to work it out, otherwise we're going to have literally dozens of serial motions that are going to come before the Court. THE COURT: Well, I'll tell you, I am averse to

discovery conferences I have to tell you, and it's partly what I said before. I don't find them resolving anything. I find

that the parties, I think, instead of working through issues decide, "Well, we're going to have this nice little discussion, so we'll just go and we'll just put everything on the table and we'll chat." And then when the conference ends and people seem

to then seek clarification on virtually everything that was discussed the day of the conference. with that. I don't mind at all using different mechanisms to make the lawyers' lives a little easier, that -- you know, if it doesn't warrant a full-blown filing process consistent with the rules, I am amendable to doing things by letter brief and the like. But I want to make sure that the parties know where the battle is; and I don't like the, "Well, let's chat about So I have real problems

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depositions; and, you know, kind of what issues do you think might come up at these depositions and I'll give you the benefit of my thoughts on that." experience. I don't like it. That doesn't work in my

So that's why I'm disinclined to

just set a general discussion date about discovery. Then, again, if you want to tee up the disputes for me in a way others -- as I say, in a formal motion process, if you think there are such discrete issues or such easily managed issues that it can be done in the form of a letter brief saying, "These are our five issues. Can we either have you

resolve it on the papers or can we do this in the way other than the full 35 day process," I'm not averse to that, but I don't want a roundtable discussion. MR. LINCOLN: Understood, Your Honor. I think one

of the sources of that request and one of the sources of frustration on our side is the difficulty of even getting through -- I mean, counsel indicates repeatedly he's the only counsel on his side working for these defendants; and, thus, finding a meet-and-confer time has been virtually impossible. Christmas Eve was the only time available for one of the meet and confers and we're still waiting for the response on it. So, from our side, what you're hearing is a request to try to find a concerted way of moving a lot of these discovery disputes along more quickly. And I'm sensitive to

not wanting to sit around a table and generally just get

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thoughts on something and invite further motion practice; but if there was a way to expedite some of these without full serial motion practice, I think it would benefit everyone. THE COURT: second. Well, let's talk about that for a

You know, I don't want to do the -- because there are

obviously very good counsel on both sides, I'm not going to say when a request for meet and confer comes in, it must be responded to in "X" number of days or "X" number of hours. I

mean, you're professionals and I defer and respect your ability to defer to you on this question, respect your ability to get things organized. That said, Mr. Mosko, I mean, they do nee -- I understand you're staffing the case in a different way than the Facebook side is staffing it, but I'm not going to make any requirements that is, you know, as I say, within certain time parameters you must respond, but it does look there is some need for more interaction and I hope you can facilitate that. Because if there's a pattern that develops beyond what I've seen thus far, then I suppose I have to weigh into it and I don't want to do that. MR. MOSKO: Fair enough.

And just with respect to Mr. Lincoln's characterizations, when a request for a meet and confer comes in and it's provided, "Get back to us in two or three days," and I happen to be in deposition in another city, I think it's

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reasonable to say, "I'm busy.

I'm not able to do that."

And you have it right about the way in which the various parties have chosen to staff the case. Mr. Lincoln, I

think, is the eighth lawyer that we've seen with respect to Facebook. I will get back -- I generally respond to somebody

within 48 hours when they make the request, and I say -- I will either say, "I'm available these times, and this is the timeframe that I have to respond," and that's the way it's gone. Unfortunately, because of the staffing decisions, we've gotten the issues of, "Well, we don't accept that." so, you can see the push and pull that's gone on. I will do my best to make myself available consistent with my calendar, but Facebook has to understand that just because they set a 48-hour window to respond to a request and then write countless e-mails to me saying, "You're refusing to meet and confer," I think that's unreasonable. I'll do my best to meet their request and to provide a reasonable timeframe in which to respond as long as they are under the -- have the understanding that they don't automatically get their 48-hour window that they usually request for meet and confers. MR. LINCOLN: The problem, Your Honor, is the choice And,

that he indicates is made about staffing the case and making himself the only person who can do it all is that they

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essentially give themselves -- attempts to give himself an unbounded continuance of all of the meet and confers. The last thing we want to do is litigate after we haven't properly met and conferred. any good. But we're now in the position in a couple of instances of having to file a motion because we can't get a response, and we're engaging in e-mail practice over whether they've given us enough time. And what you're seeing is that That doesn't do anybody

frustration of having us trying to move it forward. And I'm not in the position to tell counsel that he should be bringing somebody else into the case. That's not

what I'm suggesting; but it's not fair to us, after two years of being in this case, to still have to wait a month to find out whether they're going to respond to discovery that was due over a month ago. That's where we are. Well, the standard in this, as in many

THE COURT:

things, is reasonableness; and if, you know, I see that as a -I get the flavor that there's some, you know, strategic delay, or what have you, that's not going to be met with a lot of enthusiasm on my part. But if it's -- but at the same time I don't think I -- this case is certainly not, at this point, one that I think I should do something, which to me would be extraordinary, by saying, "Counsel have to respond to each

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other within a set period of hours." I'm going to assume that as a result of this discussion, the parties are going to do their utmost to be reasonable in response, with the understanding that all of you are busy lawyers with other matters that you're litigating and other demands upon your time. So I will -- if it looks to me like there's dodging going on, that's one thing. If it's the press of business is

such that it takes a couple of days to get back to you -- I mean, the example you used, Mr. Lincoln, of, "Well, if it's a month or two months," okay, that is a problem. And if that -- you know, I'm not going to go back now and study exactly how long it took each request to be responded to, but I'm going to assume that people are going to be in reasonable communication and that, you know, Mr. Mosko, if you're going to be out of pocket, you'll delegate somebody to handle issues in your absence. I assume you'll do that.

But I'm not going to put some special meet-and-confer response requirement at this juncture, but I don't -- you know, I understand the frustration. Yeah? MR. MOSKO: There's never been an instance in which

Mr. Lincoln has suggested whether it's been two months. In any event, the interesting issue that's before us literally right now is they insisted that we meet and confer on

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Monday.

I said, "Look, we're going to be together on Let's get all those issues together and we can talk Now whether that's reasonable or not,

Wednesday.

about that after court."

I don't know; but I'm prepared to deal with each one of the issues that they've raised and I've raised with them this afternoon after court -THE COURT: available to you -MR. MOSKO: THE COURT: -- and I'd like to go forward with that. -- although I have another matter after Well, that's good. The courtroom is

yours; but once I'm done with that, you can use the courtroom or you can use -- we'll find you another room if you need one. MR. MOSKO: THE COURT: Terrific. So... Thank you, Your Honor.

Okay.

MR. LINCOLN:

The next issue, at least as you had

raised them, was settlement conference. THE COURT: Was? Pardon me?

MR. LINCOLN: THE COURT:

Settlement conference.

Settlement conference, yes. ADR of sorts.

MR. LINCOLN: THE COURT:

Yes. As I think we included in our papers,

MR. LINCOLN:

we would propose to have a world class mediator of some sort who can come in, and I agree sooner rather than later, to try to address that. We proposed Mr. Piazza or if he's not

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available, Judge Infante. THE COURT: Do you want to go to Maui? I doubt that I'll get to be the one,

MR. LINCOLN:

but somebody else of that skill level, if you will. THE COURT: Sure. And I propose that that be --

MR. LINCOLN: THE COURT:

Well --- maybe have that done as soon as

MR. LINCOLN: possible. THE COURT:

Well, the issue is -- I mean, I'm

perfectly prepared to and will require that you explore some ADR mechanism and you do it sooner rather than later. Where I

will need the parties to agree to it, if -- it takes two to tango, if it's, as you suggest, there is going to be discussion of a global resolution, which, frankly, I think makes sense, but be that as it may, I can order you to go and will order you to go and discuss the settlement of this case. I don't think I'm in a position to order that you do a global settlement discussion. I mean, I don't think that I

can require the settlement agenda to include the Massachusetts action or any other disputes that you may have, although I think it makes sense. Just, you know, it would be in

everybody's interest to do that. So all I can do is require you to go to a settlement conference or some other mediation process within a certain

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amount of time on this case, and that I will do.

It's then the

parties -- it's for the parties to determine how broad that process is going to be; and, as I say, it makes sense, as you suggested, that at the very least you should talk about some global resolution but, you know, I can't require you to have on the agenda the Massachusetts litigation because I don't think that's within my purview at the moment. So that's where I was headed when you said -perhaps, your comments were more, "Doesn't it make sense for us to have a global discussion," and I frankly agree with you. MR. LINCOLN: That's true, but it also makes sense

to have the right people there; and I think if we're going to hear, "Well, we can't meet in the next eight months," because they need to have certain people there who are busy all day long -THE COURT: Does this go back to implicating the Is this that problem? They've indicated that they

Winklevoss brothers again? MR. LINCOLN:

Exactly.

have to be there at trial.

If they're not going to show up for

a settlement communication -- settlement conference, it's going to be difficult. THE COURT: Well, I'm going to order that you go

off, and we'll talk about what the order is going to look like; and I'm going to talk to the mediator, whoever that may be, to determine who he or she thinks has to be there and how they

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orchestrate all of that.

I mean, that is for the settlement

conference judge or a mediator to decide, I think, who they need to have and what their particular orders are. I mean, I have -- Judge Spero, for example, has a different order than I do about who has to be there when we're conducting settlement conferences, so I wouldn't intrude on a particular other mediator's process. That said, I do want you to go and have a session, an ADR session, at the very least involving this case and I want it to happen in the next 60 days. Now, it can either be a private mediator or I can order you to either go to one of our panel mediators or I can order you to go to one of my colleagues. So I want your input,

each of you -- all of you on that question. Anyone want to speak up? MR. MOSKO: I'll respond. If -- we're perfectly

happy subject to the scheduling and who needs to appear to do a mediation in front of one of the magistrate judges or a settlement conference, as it's referred to, and Mr. Lincoln made reference to world class mediators. those right here, frankly. For example, Judge Trumbull I have all the confidence in the world in and would propose that the case go to her initially; and if there is additional need or there's a possibility where additional time is necessary, if she doesn't I think you've got

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have the time to spend on it, then I think we can -- we can investigate other possibilities. But I would be more than

happy to have a settlement conference before Judge Trumbull. As the Court knows, Judge Lloyd is not a possibility with respect to my condition. THE COURT: I know. Yeah.

MR. LINCOLN: bar, Your Honor.

Plaintiffs coming in from the side

I understand that Judge Trumbull has It's (inaudible).

disqualified herself from this matter. THE COURT: MR. MOSKO: MR. COOPER:

I didn't know that, but okay. Is that right, Monte? Yeah. My understanding, Your Honor, is I can

that Magistrate Judge Trumbull was originally assigned. reverify this, but upon removal my recollection is -MR. MOSKO: but -MR. COOPER: THE COURT: be a whole mess. MR. LINCOLN: understand.

I think it was always Judge Seeborg

If I'm mistaken about that, but -We don't have to -- this doesn't have to

I can qualify, Your Honor, and now I

What happened was we had a motion to compel in the

Massachusetts case that was originally assigned to Whyte and to Magistrate Judge Trumbull, several different subpoenas served by plaintiffs' counsel. The one that was assigned to Judge Trumbull,

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Magistrate Judge Trumbull, she eventually actually withdrew from consideration deciding an undisclosed conflict, and I apologize. That's the conflict. MR. MOSKO: THE COURT: Okay, well -Well, you know, I can make it easy for

you because I was probably -- if we go the judicial mediator angle, I was going to explore San Francisco colleagues of mine. But the first issue is whether or not it ought to go to, you had suggested, Mr. Lincoln, private mediation. there any suggestion about that? Is

I mean, to someone like

Mr. Piazza, obviously, requires the parties to agree because it's not without cost. MR. MOSKO: THE COURT: Has there been discussion about that? There has not. All right. And I'm -- just in light of

the general sense I have about the likelihood of agreements on things, I'm thinking that it's perhaps better for me to just simply assign you to a wonderful free mediation service. So the question is whether or not there is -- you know, our panel mediators are, you know, some of the more respected lawyers in the community; and, so, I'm somewhat tempted by that. But I think what I'm inclined to do is to have you go and see, perhaps, either Judge -- well, unfortunately, Judge Spero is already overburdened with some of my matters -- so, perhaps, Judge Chen or -- probably send it up to Judge Chen

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actually if he was available. And, again, I'm not sure. You know, I say 60 days I don't know

to say I want to motivate the parties to do that. what his schedule is like.

He may not be free to do that.

But I'm also willing to here somebody if there are other suggestions of people that you have in mind. Tell me. MR. MOSKO: If we're going to take advantage of your Go ahead.

courtroom this afternoon, I wonder if we can table that and then come back to you as to see if we can't reach some kind of an agreement. THE COURT: All right. Just with the understanding

that it has to be some -- some ADR has to go on in the next, say, 60 to 90 days, and I can be flexible about it. If the

parties agree, the more the better; but there will not be an option to say, "We can't agree, so leave us alone." MR. MOSKO: THE COURT: I understand. There will be some ADR process within

the next 60 to 90 days of the case. MR. MOSKO: THE COURT: I understand. Okay. Anything else?

MR. LINCOLN:

The next item that you had listed was

discovery limits, and I didn't understand you're ruling on any of that. THE COURT: I wasn't --

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MR. LINCOLN:

You were just telling us to work it

The main issue with the source of the proposal to be made was most of the depositions we've got are out of state and have to be done because they can't be compelled to come to trial, and some of them are going to be short. So to end up

having to come back and fight other whether we got ten depositions that are three hours each or seven depositions -THE COURT: What I'm saying is I would rather -- I

would have preferred you to say, "We need 15 depositions rather than 10," rather than giving you an hour amount because that's -- I'm concerned -- and, perhaps, you're right, perhaps it wouldn't be this, but I'm concerned that's going to create a whole bunch of issues about the clock running and when the clock is running, and all the rest. Where I would rather, at the outset, know if you think 10 is not enough, you know, 10 is not written in stone. I'm willing to adjust in the appropriate circumstance, but I'd rather do it that way than an hours amount. You know, so if If you --

you need 15 depositions, tell me you need 15. MR. LINCOLN: 15. (Laughter) MR. LINCOLN: No.

Actually, Your Honor, that wasn't I was actually consulting with

just answering the question. the expert.

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THE COURT:

All right. Five defendants. One of the

MR. LINCOLN:

defendants happens to be a principal. Ms. Sutton is the person who has been running point on all the discovery. THE COURT: Okay. So I turn to look at her, not for any

MR. LINCOLN:

other reason than she's going to be the one who has to then explain to me why I got it wrong if I get it wrong. THE COURT: colleagues. How many do you think you need, Mr. Mosko? MR. MOSKO: THE COURT: Probably less than 15, Your Honor, so -Well, it sounds like everyone at this So I'll use 15. No shame in consulting with one's

juncture can live with 15.

And then the other discovery limits, it would seem to me, would be -- as I say, the jumping-off point is what the fallback is, the 25 interrogatories per party, and the like. Again, if there are particular reasons why you need some different limits, I'm willing to consider it. know why, but -MR. LINCOLN: The question there, Your Honor, is I'd like to

whether the original set of interrogatories that was aimed at the jurisdictional claims -THE COURT: Yes.

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MR. LINCOLN:

-- in State Court, for example, and

otherwise, whether those going to count towards this or whether we're going to get another set. I think that is the source of

some of the distinction that the parties are... MR. MOSKO: And I'm happy to respond to that. As

the Court correctly, I think, observed in its recent order in the motion to compel, the discovery that was done was not simply related to jurisdiction; that is, it wasn't, "Tell me all the contacts that you've had in a particular location." Most of it, in fact, went to the heart of the matter; and we're not, of course, taking the position that it's only relevant to personal jurisdiction, and I think -- I think literally all of that discovery that they propounded, and I think there were hundreds of interrogatories and hundreds of document requests, literally go towards the ultimate issues in the case. If the defendants are -- if the plaintiffs seek an amendment to the 25 interrogatories, and I think they've propounded substantially more than that, then I would propose there would be some kind of a motion so the Court can look at that issue similar to the other issues. THE COURT: At this juncture are you saying that -I

you're saying you want 25 more, you want more than 25 more? mean, what is your position on that? look. I have to go back and

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MR. COOPER:

Your Honor, I was integrally involved

at the State level and to answer that, if you could let me just preface the problem. When we were in front of Judge Elfing in the State level, Judge Elfing initially did grant that we could go forward on jurisdictional discovery. We served both what you

may be familiar with are the form interrogatories that are approved by the State Judicial Council. Those are some of the

interrogatories Mr. Mosko is referring to. Most of those went -- the only ones that matter relevant to this particular proceeding are those that were served on ConnectU because both the form and special interrogatories which were also served at that time went to the three dismissed parties, as well as Howard Winklevoss and ConnectU. The problem that would be faced without just having a clean slate of 25 interrogatories not directed to jurisdiction is that they were written and they were served in that period of time prior to the motion to quash with those issues in mind, not with the substantive issues of the litigation as it would go forward after discovery. Having said that, the special interrogatories, I believe we served 23 on ConnectU and they were served at the time of the jurisdictional dispute, among the other problems we would face is we got a motion to compel granting some further

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answers of those; and I wouldn't even know how to have forwarded compliance with those special rogs as they were answered at that time. I see no viable way other than to clean

the slate and say that the parties start with 25. THE COURT: Well, what I want you to do right now, I

have to deal with a pretrial conference that's got a bunch of motions and then I have to go to a judges' meeting at 4:00 o'clock, so I want you to go and start your meeting and conferring on some of these issues that we've talked about. I'm going to deal with their case and then check in with you right before I go to the judges' meeting, and we'll kind of go from there and see if I can -- well, I can go do my thing there and come back. But I want you to start the process and you have several things to work on at the moment, the trial date being sort of -- the schedule being the first, and then also some of these discovery limits, and the like; and go forth and do that. And then I will deal with this other case and then come back to you in a few minutes. MR. MOSKO: THE COURT: We can get you a room down the hallway. That's great. Thank you, Your Honor.

So I will ask my law clerk, my judicial All right. I just You

assistant -- my law clerk. MR. LINCOLN:

Your Honor, one last thing.

want to make sure that I understood what you were saying.

said that you were inclined to move the summary judgment and

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56(f) motions to the same date two weeks back. certain? THE COURT: February 27th. Thank you.

Is that a date

MR. LINCOLN: MR. MOSKO:

I want to check with my calendar to see And I think

if that date's good; and if it is, that's fine. what we'll do -THE COURT: MR. MOSKO: Okay.

-- with Your Honor's guidance, is that

we will withdraw our current motion for Rule 56(f) and then include it in one document -THE COURT: MR. MOSKO: are. THE COURT: you filed your motion. Correct. And everyone you made your -Correct. -- so the Court can see what the issues

Everything then will get moved back in

terms of the filing deadline consistent with the February 27th date. So your reply date -- your reply brief moves, your

opposition moves. MR. MOSKO: THE COURT: MR. MOSKO: I understand. Okay. Thank you, Your Honor.

(Proceedings adjourned at 3:29 p.m.)

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 _______________________________02/24/09 Signature of Transcriber Date I certify that the foregoing is a true and correct transcript, to the best of my ability, of the above pages of the official electronic sound recording provided to me by the U. S. District Court, Northern District of California, of the proceedings taken on the date and time previously stated in the above matter. I further certify that I am neither counsel for, related to, nor employed by any of the parties to the action in which this hearing was taken; and, further, that I am not financially nor otherwise interested in the outcome of the action. CERTIFICATE OF REPORTER