Apple Inc. v. Samsung Electronics Co. Ltd. et al

Filing 2126

Declaration of Susan Estrich in Support of 2013 MOTION for Judgment as a Matter of Law, New Trial and/or Remittitur Pursuant to Federal Rules of Civil Procedure 50 and 59, 2054 Brief, 2053 Opposition/Response to Motion, filed bySamsung Electronics America, Inc.(a New York corporation), Samsung Electronics Co. Ltd., Samsung Telecommunications America, LLC. (Attachments: # 1 Exhibit 1 to the Estrich Declaration, # 2 Exhibit 2 to the Estrich Declaration, # 3 Exhibit 3 to the Estrich Declaration, # 4 Exhibit 4 to the Estrich Declaration, # 5 Exhibit 5 to the Estrich Declaration, # 6 Exhibit 6 to the Estrich Declaration, # 7 Exhibit 7 to the Estrich Declaration, # 8 Exhibit 8 to the Estrich Declaration, # 9 Exhibit 9 to the Estrich Declaration, # 10 Exhibit 10 to the Estrich Declaration, # 11 Exhibit 11 to the Estrich Declaration, # 12 Exhibit 12 to the Estrich Declaration, # 13 Exhibit 13 to the Estrich Declaration, # 14 Exhibit 14 to the Estrich Declaration, # 15 Exhibit 15 to the Estrich Declaration, # 16 Exhibit 16 to the Estrich Declaration, # 17 Exhibit 17 to the Estrich Declaration, # 18 Exhibit 18 to the Estrich Declaration, # 19 Exhibit 19 to the Estrich Declaration, # 20 Exhibit 20 to the Estrich Declaration, # 21 Exhibit 21 to the Estrich Declaration, # 22 Exhibit 22 to the Estrich Declaration, # 23 Exhibit 23 to the Estrich Declaration, # 24 Exhibit 24 to the Estrich Declaration, # 25 Exhibit 25 to the Estrich Declaration, # 26 Exhibit 26 to the Estrich Declaration, # 27 Exhibit 27 to the Estrich Declaration, # 28 Exhibit 28 to the Estrich Declaration, # 29 Exhibit 29 to the Estrich Declaration, # 30 Exhibit 30 to the Estrich Declaration, # 31 Exhibit 31 to the Estrich Declaration)(Related document(s) 2013 , 2054 , 2053 ) (Maroulis, Victoria) (Filed on 11/9/2012)

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Estrich Declaration Exhibit 2 283 1 UNITED STATES DISTRICT COURT 2 NORTHERN DISTRICT OF CALIFORNIA 3 SAN JOSE DIVISION 4 5 6 APPLE INC., A CALIFORNIA CORPORATION, 7 8 9 10 11 12 13 PLAINTIFF, VS. SAMSUNG ELECTRONICS CO., LTD., A KOREAN BUSINESS ENTITY; SAMSUNG ELECTRONICS AMERICA, INC., A NEW YORK CORPORATION; SAMSUNG TELECOMMUNICATIONS AMERICA, LLC, A DELAWARE LIMITED LIABILITY COMPANY, 14 DEFENDANTS. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) C-11-01846 LHK SAN JOSE, CALIFORNIA JULY 31, 2012 VOLUME 2 PAGES 283-555 15 16 17 TRANSCRIPT OF PROCEEDINGS BEFORE THE HONORABLE LUCY H. KOH UNITED STATES DISTRICT JUDGE 18 19 20 APPEARANCES ON NEXT PAGE 21 22 23 24 25 OFFICIAL COURT REPORTER: LEE-ANNE SHORTRIDGE, CSR, CRR CERTIFICATE NUMBER 9595 284 1 A P P E A R A N C E S: 2 FOR PLAINTIFF APPLE: 3 4 MORRISON & FOERSTER BY: HAROLD J. MCELHINNY MICHAEL A. JACOBS RACHEL KREVANS 425 MARKET STREET SAN FRANCISCO, CALIFORNIA 94105 5 6 7 8 FOR COUNTERCLAIMANT WILMER, CUTLER, PICKERING, APPLE: HALE AND DORR BY: WILLIAM F. LEE 60 STATE STREET BOSTON, MASSACHUSETTS 02109 9 BY: MARK D. SELWYN 950 PAGE MILL ROAD PALO ALTO, CALIFORNIA 10 11 13 QUINN, EMANUEL, URQUHART, OLIVER & HEDGES BY: CHARLES K. VERHOEVEN 50 CALIFORNIA STREET, 22ND FLOOR SAN FRANCISCO, CALIFORNIA 94111 14 BY: 12 FOR THE DEFENDANT: 94304 16 VICTORIA F. MAROULIS KEVIN P.B. JOHNSON 555 TWIN DOLPHIN DRIVE SUITE 560 REDWOOD SHORES, CALIFORNIA 17 BY: 15 18 19 20 21 22 23 24 25 94065 MICHAEL T. ZELLER WILLIAM C. PRICE JOHN B. QUINN 865 SOUTH FIGUEROA STREET 10TH FLOOR LOS ANGELES, CALIFORNIA 90017 285 1 2 INDEX OF PROCEEDINGS 3 4 OPENING STATEMENT BY MR. MCELHINNY P. 304 5 OPENING STATEMENT BY MR. LEE P. 353 6 OPENING STATEMENT BY MR. VERHOEVEN P. 380 7 8 9 10 11 12 INDEX OF WITNESSES 13 14 PLAINTIFF'S 15 CHRISTOPHER STRINGER DIRECT EXAM BY MR. MCELHINNY CROSS-EXAM BY MR. VERHOEVEN REDIRECT EXAM BY MR. MCELHINNY P. 469 P. 511 P. 537 PHILIP SCHILLER DIRECT EXAM BY MR. MCELHINNY P. 541 16 17 18 19 20 21 22 23 24 25 358 1 TELEVISION, A MICROWAVE, ALL INTO THE SAME OUTLET 2 BECAUSE THERE'S A STANDARD. 3 NOW, IN WIRELESS COMMUNICATIONS THAT WE 4 BEGAN TALKING TO YOU ABOUT YESTERDAY AND WE'RE 5 GOING TO TALK TO YOU ABOUT IN THE NEXT COUPLE OF 6 WEEKS, THERE ARE STANDARDS, TOO, STANDARDS THAT 7 ALLOW PHONES TO CONNECT TO ONE ANOTHER, STANDARDS 8 THAT ALLOW PHONES TO CONNECT OVER A WIRELESS 9 NETWORK. 10 SO WHO SETS THESE STANDARDS? 11 THE EVIDENCE WILL PROVE THAT ONE STANDARD 12 ORGANIZATION IS SOMETHING CALLED ETSI, THE EUROPEAN 13 TELECOMMUNICATIONS STANDARDS INSTITUTE. 14 DEAL STANDARDS BODY. 15 MOST POPULAR STANDARDS FOR WIRELESS COMMUNICATIONS 16 IN THE WORLD. IT'S A BIG IT HELPED DEVELOP SOME OF THE 17 SAMSUNG IS A MEMBER, AND HAS BEEN. 18 APPLE IS A MEMBER. 19 MOST IMPORTANTLY, THE EVIDENCE WILL 20 ESTABLISH THAT THE MEMBERS AGREE TO A SET OF RULES, 21 RULES THAT THEY WILL ALL LIVE BY, RULES THAT THEY 22 WILL ABIDE BY, RULES THAT ARE DESIGNED TO ENSURE 23 THAT PEOPLE ACT FAIRLY AND SQUARELY. 24 25 NOW, ETSI HELPED DEVELOP A STANDARD YOU WILL LEARN CALLED UMTS. UMTS IS SOMETIMES REFERRED 359 1 TO, AND YOU MAY HAVE SEEN IT, AS 3GPP. 2 PURPOSES, THEY ARE CLOSE TO THE SAME. 3 FOR OUR ENGINEERS FROM DIFFERENT COMPANIES CAME 4 TOGETHER. 5 PROPOSALS. 6 STANDARD, WHAT WAS GOING TO BE THEIR EQUIVALENT OF 7 THE SOCKET. 8 9 10 THEY DISCUSSED DIFFERENT TECHNICAL THEY DECIDED WHAT TO INCLUDE IN THE AND THE GOAL WAS TO COME UP WITH A STANDARD THAT EVERYBODY COULD USE TOGETHER AND IT WOULD PROMOTE COMPETITION. 11 NOW, SAMSUNG CLAIMS THAT THE TWO PATENTS, 12 THE '941 AND THE '516, ARE ESSENTIAL TO USING UMTS. 13 SAMSUNG IS GOING TO TELL YOU IN JUST A FEW MINUTES 14 THAT IF YOU USE UMTS, YOU USE THESE PATENTS AND YOU 15 INFRINGE. WELL, WHAT'S THE EVIDENCE GOING TO SHOW 16 17 YOU ABOUT THIS ARGUMENT? 18 FIRST, THE EVIDENCE IS GOING TO SHOW THAT 19 "DECLARED ESSENTIAL" MEANS SIMPLY THAT SAMSUNG HAS 20 SAID SO. 21 THE EVIDENCE WILL ESTABLISH THAT NO ONE, 22 NOT ETSI, NOT ANYONE ELSE, HAS EVER DECIDED THAT 23 THAT'S, IN FACT, TRUE. 24 25 YOU WILL BE THE FIRST PEOPLE TO DECIDE WHETHER SAMSUNG'S STATEMENT THAT ITS PATENTS WERE 360 1 ESSENTIAL IS TRUE. 2 WE WILL CALL PROFESSORS EDWARD KNIGHTLY 3 FROM RICE AND PROFESSOR HYONG KIM FROM CARNEGIE 4 MELLON UNIVERSITY, TWO VERY WELL KNOWN AND 5 REPUTABLE COMPUTER SCIENTISTS AND ENGINEERS, AND 6 THEY WILL EXPLAIN TO YOU THAT THEY HAVE LOOKED AT 7 SAMSUNG'S PATENTS AND THEY ARE, IN FACT, NOT 8 ESSENTIAL TO UMTS, THAT, IN FACT, APPLE DOES NOT 9 USE THEM. 10 BUT SECOND, YOU WILL ALSO LEARN THAT THE 11 ENTIRE UMTS STANDARD IS THOUSANDS OF PAGES LONG. 12 IF I HAD IT IN THIS COURTROOM, IT WOULD GO FROM 13 HERE TO THAT WALL AND PROBABLY BACK AGAIN. 14 OUT OF THAT ENTIRE SPECIFICATION, YOU 15 WILL LEARN, THESE TWO PATENTS, EVEN UNDER SAMSUNG'S 16 CONTENTIONS, RELATE TO TWO PAGES. 17 NOW, I'D LIKE TO SHOW YOU JUST WHAT IT IS 18 IN THE IPHONE THAT SAMSUNG SAYS INFRINGES THESE TWO 19 PATENTS THAT IS ESSENTIAL TO WIRELESS 20 COMMUNICATIONS. 21 I HAVE ANOTHER IPHONE. MR. MCELHINNY HAD 22 ONE. 23 SEE -- YOU'LL SEE SEVERAL OF THESE DURING THE 24 COURSE OF THE TRIAL -- ARE THE INSIDES. 25 I'VE TAKEN OFF THE BACK AND WHAT YOU'LL BUT UNDERNEATH THE BLACK THAT I'M SHOWING 361 1 YOU NOW IS A HOST OF A COMPUTER CHIP AND THE 2 CONNECTIONS AND THE COMPONENTS THAT MAKE THE IPHONE 3 THE MAGICAL DEVICE THAT IT IS (INDICATING). 4 IF I WERE TO PULL OFF THIS BLACK, YOU CAN 5 SEE AT THE TOP RIGHT HERE, IF I WERE TO PULL THAT 6 OFF, YOU WOULD GET WHAT'S CALLED THE MOTHERBOARD 7 (INDICATING). 8 9 AND YOU CAN SEE ON THE MOTHERBOARD A SERIES OF CHIPS, A SERIES OF CONNECTIONS, ALL OF 10 WHICH CONTRIBUTE TO WHAT MR. MCELHINNY DESCRIBED TO 11 YOU. 12 NOW, YOU CAN'T SEE IT NOW -- WE'LL PASS 13 THIS TO YOU WHEN IT GOES INTO EVIDENCE -- BUT I 14 HAVE TWO LITTLE DOTS HERE, AND RIGHT ABOVE THOSE 15 TWO LITTLE DOTS, I'M PUTTING MY FINGER ON THIS 16 LITTLE SQUARE HERE, NOT EVEN AS BIG AS MY FINGER. 17 WHAT IS THAT? THAT'S THE BASEBAND 18 PROCESSOR. 19 INTEL. 20 AND A HOST OF OTHER DIFFERENT CUSTOMERS. 21 DEVICE THAT ACTUALLY PERFORMS WHAT SAMSUNG SAYS IS 22 INFRINGING, THE INTEL CHIP. 23 THAT IS SOMETHING THAT APPLE BUYS FROM IT'S SOMETHING THAT INTEL MAKES FOR APPLE IT IS THE IT IS A CHIP, IT IS A CHIP THAT APPLE 24 BUYS FOR AROUND $10 APIECE, AND I'D ASK YOU TO KEEP 25 THAT IN MIND BECAUSE I'M GOING TO COME BACK TO THE 362 1 AMOUNT OF MONEY THAT SAMSUNG IS ASKING ON THESE TWO 2 PATENTS. 3 NOW, I EXPECT THAT IN A FEW MINUTES, I'M 4 SURE IN A FEW MINUTES SAMSUNG IS GOING TO GET UP 5 AND SAY, "WE PLAYED AN IMPORTANT ROLE IN DEVELOPING 6 THIS CELLULAR TELECOMMUNICATION SYSTEM. 7 PATENTS THAT ARE IN THIS BASEBAND PROCESSOR YOU BUY 8 FROM INTEL WERE OURS AND CRITICAL TO THE 9 INFORMATION HIGHWAY." 10 THESE WELL, LET ME SHOW YOU WHAT ONE OF THE 11 HEADS OF SAMSUNG'S LICENSING DEPARTMENT, A 12 GENTLEMAN NAMED DR. AHN, TESTIFIED UNDER OATH ON 13 THIS VERY ISSUE. 14 DR. AHN REPORTS DIRECTLY TO THE CHIEF 15 EXECUTIVE OFFICER OF SAMSUNG AND HERE'S WHAT HE 16 SAID. 17 "DO YOU HAVE ANY KNOWLEDGE AS TO WHETHER 18 OR NOT SAMSUNG PLAYED AN IMPORTANT ROLE IN 19 DEVELOPING THE CELLULAR TELECOMMUNICATION SYSTEM? 20 "ANSWER: NO, I DO NOT REALLY KNOW." 21 THE DIRECT REPORT TO THE CEO WAS ASKED 22 THAT QUESTION WHEN THIS CASE BEGAN AND THE ANSWER 23 WAS I DON'T KNOW. 24 25 NOW, WHAT YOU'RE GOING TO LEARN IS THAT SAMSUNG DID PARTICIPATE IN THIS RULE-BASED STANDARD 363 1 SETTING PROCESS, AND WHAT YOU'RE GOING TO LEARN IS 2 THAT IN DOING SO, SAMSUNG ACTUALLY BROKE THE RULES, 3 THE RULES THAT WERE ADOPTED TO ENSURE THE STANDARD 4 PROCESS WAS FAIR AND SQUARE. 5 6 NOW, WHAT WERE THOSE RULES? THERE WERE TWO. 7 THE FIRST RULE IS THE RULE THAT REQUIRES 8 EVERYONE WHO HAS A PATENT THAT THEY SAY MIGHT BE 9 ESSENTIAL TO THE STANDARD TO DISCLOSE IT. 10 WHAT WILL THE EVIDENCE SHOW IS THE 11 REASON? 12 OF THE WALL SOCKET. 13 THINK ABOUT MY SIMPLE EXAMPLE OF THE PLUG, IF I HAD A PATENT APPLICATION, A SECRET 14 PATENT APPLICATION LIKE THE VIDEO TOLD YOU ON A 15 WALL SOCKET, AND I THEN WENT TO THE STANDARD AND 16 SAID, "LET'S ALL GET TOGETHER, THE TEN OF US, AND 17 ADOPT AS A STANDARD THIS PARTICULAR CONFIGURATION," 18 AND WE ALL GOT TOGETHER, THE TEN OF US, AND WE 19 ADOPTED THIS CONFIGURATION, AND THEN EVERYBODY IN 20 THE WORLD MADE THEIR WALL SOCKETS THAT WAY, AND 21 THEN A FEW YEARS LATER, I SAID, "I FORGOT TO TELL 22 YOU. 23 ME." 24 25 I HAVE A PATENT AND NOW YOU ALL HAVE TO PAY WELL, ETSI HAS RULES TO PREVENT JUST THAT, AND YOU WILL SEE RULE 4.1, AND I'M GOING TO 364 1 FOCUS YOU JUST ON THE SECOND SENTENCE WHICH SAYS, 2 "IN PARTICULAR, A MEMBER SUBMITTING A TECHNICAL 3 PROPOSAL FOR A STANDARD SHALL, ON A BONA FIDE 4 BASIS, DRAW THE ATTENTION OF ETSI TO ANY OF THAT 5 MEMBER'S IPR WHICH MIGHT BE ESSENTIAL IF THAT 6 PROPOSAL IS ADOPTED." 7 THREE THINGS YOU'LL LEARN ABOUT THAT VERY 8 IMPORTANT SIMPLE SENTENCE. 9 PATENTS AND PATENT APPLICATIONS, INTELLECTUAL 10 PROPERTY RIGHTS. 11 THE FIRST IS IPR MEANS IT INCLUDES BOTH. THE SECOND IS IT SAYS IF THAT MIGHT BE 12 ESSENTIAL, AND THE THIRD IS IT SAYS IF THE PROPOSAL 13 IS ADOPTED. 14 15 SO IT MEANS BEFORE THE FOLKS HAVE SETTLED ON THE WALL SOCKET. THE EVIDENCE WILL DEMONSTRATE THAT 16 17 SAMSUNG IGNORED THIS RULE. IT FILED PATENT 18 APPLICATIONS WHICH WERE KEPT SECRET. IT THEN WENT TO STANDARDS BODY AND MADE 19 20 PROPOSALS THAT IT THOUGHT WERE COVERED BY ITS 21 PATENTS. 22 "IF YOU HAVE PATENTS OR PATENT APPLICATIONS, 23 DISCLOSE THEM," AND THEY DID NOT. 24 25 IT SAT IN THE ROOM WHEN THE CHAIR SAID, THE CHRONOLOGY WILL BE UNDISPUTED -- I'M GOING TO PUT IT ON THE SCREEN NOW -- FOR BOTH OF 481 1 ALREADY HAS THE PERSPECTIVE SET UP AND THE VIEWS IN 2 A WAY THAT YOU CAN SORT OF ADD IN LAVISH DETAIL 3 UPON THEM. 4 Q 5 DOCUMENT, PX 163, TO WHAT DO THEY RELATE? 6 A 7 8 AND WHAT DO THE SKETCHES ON THIS PARTICULAR THESE ARE SKETCHES OF IPHONE IDEAS. MR. MCELHINNY: YOUR HONOR, I WOULD MOVE PX 163, PLEASE. 9 MR. VERHOEVEN: NO OBJECTION, YOUR HONOR. 10 THE COURT: ALL RIGHT. SO ADMITTED. 11 (WHEREUPON, PLAINTIFF'S EXHIBIT NUMBER 12 163, HAVING BEEN PREVIOUSLY MARKED FOR 13 IDENTIFICATION, WAS ADMITTED INTO 14 EVIDENCE.) 15 BY MR. MCELHINNY: 16 Q SIR, IF YOU'D OPEN YOUR BINDER TO PX 164. 17 A YES, I SEE IT. 18 Q WHAT IS PX 164? 19 A THE FIRST PAGE IS A SCREEN SHOT OF A 20 DIRECTORY, WHICH IS THE CAD FILE DATABASE. 21 LISTS DATE MODIFIED, WHICH MEANS THE LAST DATE THAT 22 YOU WORKED ON THIS PARTICULAR FILE. 23 24 25 IT AND ALSO A CODE NAME, A THREAD. BASICALLY, THAT HELPS YOU FIND IT IN THE DATABASE. SUBSEQUENT PAGES ARE SCREEN SHOTS OF 482 1 THESE CAD MODELS. 2 Q 3 SOMETHING ABOUT A CAD OUTPUT. 4 WERE REFERRING TO AS A CAD OUTPUT? 5 A 6 SOPHISTICATION. 7 I WOULD CALL CAD OUTPUT. 8 Q 9 DATE OF THESE DRAWINGS? YOU MENTIONED IN AN EARLIER ANSWER, YOU SAID YES. IS THIS WHAT YOU THERE ARE VARYING DEGREES OF THIS IS A FAIRLY CRUDE SET OF WHAT CAN YOU TELL, BY LOOKING AT THE DIRECTORY, THE 10 A MARCH 15TH, 2006. 11 Q AND, SIR, DO YOU -- DO YOU WORK WITH THE -- 12 LET ME ASK YOU THIS: 13 CAD SYSTEM? 14 A NO, I DO NOT. 15 Q WHO DOES THE CAD DRAWINGS AT APPLE? 16 A WE HAVE A DEDICATED TEAM OF CAD SCULPTORS. 17 THERE ARE A FEW DESIGNERS THAT ARE CAPABLE OF 18 CREATING CAD THEMSELVES, BUT IT'S NOT A 19 REQUIREMENT. 20 DO YOU PERSONALLY OPERATE THE IN FACT, MOST OF US DON'T. IT'S -- IT REALLY IS A SKILL THAT YOU 21 NEED TO DEDICATE SIGNIFICANT TIME TO JUST TO 22 UNDERSTAND THE CRAFT OF CAD. 23 24 25 SO WE PREFER OUR DESIGNERS TO BE THINKING, SO WE HAVE A DEDICATED TEAM FOR THIS. MR. MCELHINNY: YOUR HONOR, I WOULD MOVE 483 1 PX 164 INTO EVIDENCE. 2 MR. VERHOEVEN: 3 THE COURT: 4 (WHEREUPON, PLAINTIFF'S EXHIBIT NUMBER 5 164, HAVING BEEN PREVIOUSLY MARKED FOR 6 IDENTIFICATION, WAS ADMITTED INTO 7 EVIDENCE.) 8 Q SO ADMITTED. BY MR. MCELHINNY: 9 NO OBJECTION, YOUR HONOR. SO AFTER CAD MODELS, WHAT COMES NEXT, SIR, IN 10 A DESIGN PROCESS, ASSUMING THAT YOU WERE GOING 11 LINEARLY AS OPPOSED TO JUMPING BACKWARDS? 12 A 13 PURSUE AN IDEA THAT WE SEE IN THE CAD SURFACES IN 14 PHYSICAL FORM, WE MODEL IT, WHICH IS TO CNC, 15 COMPUTER NUMERICALLY CONTROLLED. IF WE FIND THAT WE AGREE, THAT WE WANT TO THAT IS THREE OR FIVE MACHINING, WHICH 16 17 ESSENTIALLY CUTS FROM A SOLID BLOCK A PHYSICAL 18 LIKENESS OF WHAT WE BUILD IN CAD. 19 Q 20 THAT AN ACCURATE DESCRIPTION OF THE PROCESS THAT 21 LED TO THE ORIGINAL IPHONE? 22 A YES. 23 Q AND IS IT AN ACCURATE DESCRIPTION OF THE 24 PROCESS THAT LED TO THE IPAD? 25 A THIS PROCESS THAT YOU'VE DESCRIBED FOR US, IS YES. 484 1 Q LET'S TALK ABOUT THE IPHONE FOR A MINUTE. 2 WHAT -- IF YOU CAN DESCRIBE IT FOR US, 3 WHAT, IF ANYTHING, WERE YOU TRYING TO ACHIEVE IN 4 DESIGNING THE IPHONE? 5 A 6 BEAUTIFUL OBJECT, SOMETHING THAT WOULD REALLY WOW 7 THE WORLD. WE -- WE WERE LOOKING FOR A NEW, ORIGINAL, AND 8 9 WE WERE ENTERING A CATEGORY THAT WE'D NEVER PARTICIPATED IN BEFORE, AND THE CATEGORY THAT 10 WE DID NOT ENJOY. 11 THERE WERE NO CELL PHONES THAT WE LOVED. 12 SO THIS WAS SOMETHING THAT WE REALLY 13 CARED DEEPLY AND PASSIONATELY ABOUT, PRODUCING 14 SOMETHING FOR OURSELVES. WE -- AS ALWAYS, WE WANTED TO CREATE 15 16 SOMETHING THAT SEEMED SO, SO WONDERFUL THAT YOU, 17 YOU CAN'T IMAGINE HOW YOU COULD FOLLOW IT. 18 OF COURSE, YOU CAN BECAUSE IF YOU LOOK AT 19 THE HISTORY OF OUR PRODUCTS, WE'VE DONE THAT TIME 20 AND TIME AGAIN. 21 BUT YOU WANT TO CREATE THE SIMPLEST, 22 PUREST MANIFESTATION OF WHAT THAT OBJECT CAN BE, 23 SOMETHING THAT PEOPLE CAN LOVE. 24 Q 25 WORKED ON THE DESIGN OF THE IPHONE? DO YOU RECALL APPROXIMATELY HOW LONG YOU 485 1 A I HAVE NO IDEA. I'D HAVE TO LOOK AT 2 DOCUMENTATION FOR THIS. 3 Q YEARS? 4 A I THINK SO. 5 Q LET ME SHOW YOU PX 165. BUT IT WAS A LONG TIME. 6 MAY I APPROACH, YOUR HONOR? 7 THE COURT: 8 MR. MCELHINNY: 9 THE WITNESS: YES. (HANDING). THANK YOU. 10 BY MR. MCELHINNY: 11 Q WHAT IS PX 165, SIR? 12 A THIS IS ONE OF THE EARLY MODELS THAT WE BUILT 13 ON M68, WHICH WAS A CODE NAME THAT WE USED FOR THE 14 ORIGINAL IPHONE. 15 Q I'M SORRY. 16 A THAT'S CORRECT. 17 Q WHEN YOU SAY "WE BUILT THIS MODEL," WHO ARE 18 YOU TALKING ABOUT? 19 A 20 WOULD INCLUDE THE CAD AND THE MODEL MAKING TEAMS. 21 Q 22 THIS ORIGINAL APPLE WORK? 23 A 24 25 THAT'S M68? "WE" BEING THE INDUSTRIAL DESIGN GROUP, WHICH AND IS THIS MODEL THAT YOU'RE LOOKING AT, WAS ABSOLUTELY, YES. MR. MCELHINNY: YOUR HONOR, I WOULD MOVE EXHIBIT PX 165 INTO EVIDENCE. 486 1 2 MR. VERHOEVEN: I HAVE A POINT OF QUESTION. 3 CAN I CONFER WITH COUNSEL? 4 THE COURT: 5 (DISCUSSION OFF THE RECORD BETWEEN 6 YES, GO AHEAD, PLEASE. COUNSEL.) 7 MR. VERHOEVEN: SUBJECT TO YOUR HONOR'S 8 RULING, YOUR HONOR'S ALREADY RULED ON THESE 9 DOCUMENTS -- I DON'T KNOW IF WE CAN HAVE A 10 SIDE-BAR, YOUR HONOR. 11 DON'T WAIVE ANYTHING. 12 13 THE COURT: I JUST WANT TO MAKE SURE I OKAY. I THOUGHT THIS WAS WORKED OUT BEFORE THE JURY CAME OUT. 14 LET'S DO THAT. UNFORTUNATELY, THE 15 MICROPHONE IS NOT WORKING, SO WE'LL HAVE TO 16 MEMORIALIZE IT AFTER. 17 LET'S GO AHEAD. 18 MR. VERHOEVEN: 19 (SIDE-BAR DISCUSSION OFF THE RECORD.) 20 THE COURT: THAT'S OKAY. OKAY. THE -- I UNDERSTAND 21 THAT THE SAME OBJECTION WAS RESERVED, BUT IT'S 22 OVERRULED. 23 THIS IS ADMITTED. 24 (WHEREUPON, PLAINTIFF'S EXHIBIT NUMBER 25 165, HAVING BEEN PREVIOUSLY MARKED FOR 487 1 IDENTIFICATION, WAS ADMITTED INTO 2 EVIDENCE.) 3 THE COURT: 4 MR. MCELHINNY: 5 GO AHEAD. THANK YOU, YOUR HONOR. MAY I PUBLISH THIS TO THE JURY? 6 THE COURT: 7 (PAUSE IN PROCEEDINGS.) 8 BY MR. MCELHINNY: 9 Q GO AHEAD. MR. STRINGER, LET ME SHOW YOU AN EXHIBIT 10 THAT'S BEEN MARKED AS PX 166 (HANDING). 11 A YES. 12 Q WHAT IS THAT DEVICE, SIR? 13 A THIS IS ALSO AN EARLY IPHONE MODEL, ALSO UNDER 14 ITSELF CODE NAME M68. 15 Q IS IT THE SAME OR DIFFERENT THAN THE 165? 16 A SIMILAR, BUT DIFFERENT. 17 Q OKAY. 18 SIR? 19 A APPLE PROTO 1015 -- OH, IPOD. 20 Q AND WHY DOES IT SAY IPOD ON A PROTOTYPE OF AN 21 IPHONE, SIR? 22 A 23 COINED THE TERM "IPHONE" AND WE WANTED TO SEE 24 SOMETHING GRAPHICALLY REPRESENTED ON THE BACK; OR 25 WE WERE TRYING TO DISGUISE ITS IPHONE IDENTITY. AND WHAT DOES IT SAY ON THE BACK OF IT, ONE OF TWO REASONS. EITHER WE HAD NOT YET 1 2 3 CERTIFICATE OF REPORTER 4 5 6 7 8 9 I, THE UNDERSIGNED OFFICIAL COURT REPORTER OF THE UNITED STATES DISTRICT COURT FOR 10 THE NORTHERN DISTRICT OF CALIFORNIA, 280 SOUTH 11 FIRST STREET, SAN JOSE, CALIFORNIA, DO HEREBY 12 CERTIFY: 13 THAT THE FOREGOING TRANSCRIPT, 14 CERTIFICATE INCLUSIVE, CONSTITUTES A TRUE, FULL AND 15 CORRECT TRANSCRIPT OF MY SHORTHAND NOTES TAKEN AS 16 SUCH OFFICIAL COURT REPORTER OF THE PROCEEDINGS 17 HEREINBEFORE ENTITLED AND REDUCED BY COMPUTER-AIDED 18 TRANSCRIPTION TO THE BEST OF MY ABILITY. 19 20 21 22 /S/ _____________________________ LEE-ANNE SHORTRIDGE, CSR, CRR CERTIFICATE NUMBER 9595 23 24 25 DATED: JULY 31, 2012

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