VIA Technologies, Inc. (a California corporation) et al v. ASUS Computer International et al
Filing
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Order by Magistrate Judge Howard R. Lloyd denying 190 Motion for Leave to Amend Infringement Contentions. (hrllc3S, COURT STAFF) (Filed on 1/30/2017)
E-filed 1/30/2017
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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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VIA TECHNOLOGIES, INC. (A
CALIFORNIA CORPORATION), et al.,
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United States District Court
Northern District of California
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Case No.14-cv-03586-BLF (HRL)
ORDER DENYING LEAVE TO AMEND
INFRINGEMENT CONTENTIONS
Plaintiffs,
v.
Re: Dkt. Nos. 189, 190
ASUS COMPUTER INTERNATIONAL, et
al.,
Defendants.
In the present motion before the court, plaintiffs Via Technologies, Inc. (California), Via
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Technologies, Inc. (Taiwan), and Via Labs, Inc., (together, “VIA”) seek to amend their patent
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infringement contentions to address a claim construction ruling by the court that VIA asserts
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differs from the one it proposed. Dkt. No. 189. Defendants ASUS Computer International,
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ASUSTeK Computer, Inc., and ASMedia Technology, Inc. (together, “Defendants”), oppose the
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motion. Dkt. No. 196. For the reasons described below, the court denies VIA’s motion for leave
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to amend its infringement contentions.
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BACKGROUND
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VIA served its initial infringement contentions regarding U.S. Patent No. 7,313,187 (“the
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‘187 Patent”) in 2015. Claim number one of the ‘187 patent includes a term: “a parallel-to-serial
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unit which receives a parallel data to serialize the parallel data into a serial data and a delayed
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serial data.” Dkt. No. 176. While VIA proposed that the court adopt in its claim construction
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order the plain meaning of this term, the court instead adopted Asus’s proposed construction,
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construing the term as a “means-plus-function” limitation in its order of August 19, 2016. Id.
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Defendants assert that VIA first had notice of the means-plus-function construction in November
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2015, when defendants filed their Patent Local Rule 4-1 disclosures. Dkt. No. 196, Bakhar Decl.,
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Ex. 5.
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VIA first notified Defendants of its intent to amend its infringement contentions more than
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one month after the claim construction order, on September 26, 2016, in an e-mail asking whether
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the defendants would oppose a motion to amend. Dkt. No. 196, Bakhar Decl., at ¶ 2. Defendants
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responded on the same day, inquiring into the basis for the proposed amendment and asking for a
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redlined version of the amended contentions. Id. at ¶ 3. On October 4, 2016, VIA explained that
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the amendments would be based on the court’s claim construction and promised a redlined draft.
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Id. at ¶ 4. One month later, and a little more than two-and-a-half months after the court’s claim
construction order, on November 6, 2016, VIA served its proposed amended infringement
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United States District Court
Northern District of California
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contentions and a redlined version showing the changes from the previous contentions. Id. at ¶ 5.
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VIA filed its motion to amend with the court on November 18, 2016, three months after the claim
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construction order and the same day that fact discovery closed. Dkt. No. 174.
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LEGAL STANDARD
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The patent local rules “require parties to crystallize their theories of the case early in
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litigation and to adhere to those theories once they have been disclosed.” DCG Sys. V. Checkpoint
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Techs., LLC, No. C 11-03792 PSG, 2012 WL 1309161, at *2 (N.D. Cal. Apr. 16, 2012) (quoting
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O2 Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d 1355, 1366 n.12 (Fed. Cir. 2006)).
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While the patent local rules’ policy toward amending infringement contentions leans conservative,
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the patent local rules “are not a straitjacket into which litigants are locked from the moment their
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contentions are served. There is a modest degree of flexibility, at least near the outset.” Id.
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(quoting Halo Elecs., Inc. v. Bel Fuse Inc., No. C 07-06222 RMW (HRL), 2010 WL 349593, at *1
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(N.D. Cal., Sep. 3, 2010).
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Patent Local Rule 3.6 governs the amendment of infringement contentions. It states that
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amendments “may be made only by order of the Court upon a timely showing of good cause.”
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Patent L.R. 3-6. Courts evaluating requests for leave to amend apply a two-step analysis to
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determine if there is good cause: “first the court must determine whether the non-moving party
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was diligent in amending its contentions; second[,] the court must determine whether the non2
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moving party would suffer undue prejudice if the motion to amend were granted.” DCG Sys.,
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2012 WL 1309161, at *3. In establishing good cause, the burden is on the moving party to show
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diligence. Apple Inc. v. Samsung Elecs. Co., Ltd., No. CV 12-00630 LHK, 2012 WL 5632618, at
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*2 (N.D. Cal. Nov. 15, 2012). One circumstance that may, absent prejudice to the non-moving
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party, support a finding of good cause is “[a] claim construction by the Court different from that
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proposed by the party seeking amendment.” Patent L.R. 3-6(a). But a differing claim
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construction “in and of itself does not constitute good cause” to amend; “the moving party must
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still establish its diligence.” Tech. Props. Ltd. LLC v. Canon Inc., No. 14-3643, 2016 WL
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1360756, at *3 (N.D. Cal. Apr. 6, 2016) (quoting Verinata Health, Inc. v. Sequenom, Inc., No. C
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12-00875 SI, 2014 WL 789197, at *2 (N.D. Cal. Feb. 26, 2014)).
United States District Court
Northern District of California
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DISCUSSION
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VIA asserts that good cause exists to allow it to amend its infringement contentions
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because the court adopted a different claim construction from the one it proposed. Dkt. No. 189.
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VIA justifies the delay between the court’s claim construction ruling and its motion to amend by
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pointing to a case, Vasudevan Software, Inc. v. Int’l Bus. Machines Corp., No. C09-05897 RS
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(HRL), 2011 WL 940263, at *3 (N.D. Cal. Feb. 18, 2011), in which a four-month delay was
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deemed acceptable, and by explaining that part of the delay can be attributed to its expert’s efforts
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in responding to a prior discovery order of this court, Dkt. No. 197. Additionally, VIA asserts that
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the defendants will not be prejudiced by its amendments because they received the proposed
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changes a week before deposing experts on technical issues and because the rebuttal expert report
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deadline was not until January 27, 2017. Id.
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In response, Defendants assert that delaying the filing of a motion to amend for three
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months after the court’s claim construction order and waiting until the last day of fact discovery is
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not diligent. Defendants also argue that they will be prejudiced because they will not have the
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opportunity to conduct any additional discovery related to the proposed amendment, which they
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claim constitutes a new theory of infringement. Dkt. No. 196.
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As an initial matter, the court must determine from when it must measure VIA’s diligence
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in moving to amend. Courts in this district disagree about the relevant starting time. Tech. Props.
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Ltd., LLC v. Canon Inc., No. 14-cv-3643, 2016 WL 1360756, at *3-4 (N.D. Cal. Apr. 6, 2016)
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(discussing the split). For example, in Chimar Systems v. Cisco Systems, the court stated that
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Patent Local Rule 3-6 does not require parties to move to amend prior to the issuance of the claim
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construction order and measured the moving party’s diligence from the date of that order. No. 13-
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cv-01300-JSW (MEJ), 2015 U.S. Dist. LEXIS 73935, at *17 (N.D. Cal. May 14, 2015). In
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contrast, in Cisco Systems, Inc. v. Teleconference System, LLC, the court held that the date on
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which the moving party first received notice of the adverse construction from the opposing party
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was the appropriate starting date, as “that is when [the moving party] first became aware of the
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risk that the district court could adopt [the adverse] construction.” No. 10-cv-05740 JSW (NC),
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2012 WL 9337627 (N.D. Cal. June 11, 2012); see also Verinata Health, Inc. v. Sequenom, Inc.,
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United States District Court
Northern District of California
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No. C 12-00865 SI, 2014 WL 789197 (N.D. Cal. Feb. 26, 2014) (measuring diligence from the
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time that the moving party first received notice of the proposed adverse construction).
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The court is persuaded that the relevant time from which to measure diligence when (as
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here) the court adopts the opposing party’s construction is the date the moving party receives
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notice of that construction, as this is when diligent preparations could begin. Karl Storz
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Endoscopy-America, Inc. v. Stryker Corp., No. 14-cv-00876-RS (JSC), 2016 WL 7386136, at *4
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(N.D. Cal. Dec. 21, 2016). This is not to say that the moving party must draft its proposed
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amendments the very next day; but a diligent party would prepare so that it would be ready to
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respond expeditiously to the court’s issuance of an adverse claim construction order.
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Here, VIA has had notice of the adverse claim construction ultimately adopted by the court
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since it appeared in the defendant’s patent local rule disclosures in November 2015. But even
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measuring from the court’s claim construction order, VIA has not established diligence. VIA
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waited two-and-a-half months before serving its proposed amendments, and it waited another two
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weeks to file those amendments with the court. Courts in this district have found that such delays
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do not constitute diligence. Verinata Health, Inc. v. Sequenom, Inc., No. C 12-00865 SI, 2014 WL
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789197, at *3 (N.D. Cal. Feb. 26, 2014) (finding that the moving party was not diligent when it
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served its proposed amendments two-and-a-half months after the claim construction order and
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filed its motion two weeks later); see also O2 Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 467
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F.3d 1355, 1367 (Fed. Cir. 2006) (finding no diligence where the moving party waited three
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months to serve its proposed amended contentions). Additionally, the court is not persuaded that
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VIA’s stated reason for its schedule excuses the delay. Though responding to this court’s
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discovery order may have been time-consuming, that order did not issue until October 12, 2016, at
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which time nearly two months had already passed since the court’s claim construction order. VIA
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offers no explanation for its delays between August 19 and October 12.
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Finally, the court is not convinced that VIA’s e-mail of September 26, 2016, provided
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sufficient notice of the proposed amendments to the defendants to support a finding of diligence.
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The e-mail says, simply, “Please advise us whether Defendants will oppose a motion by VIA to
amend its infringement contentions under Patent L.R. 3-6 based on the Court’s claim construction
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United States District Court
Northern District of California
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ruling.” Dkt. No. 196, Bhakar Decl., Ex. 1. At the hearing on this motion, VIA argued that, based
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on the claim construction order, this e-mail should have made the subject of its proposed
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amendments obvious to the defendants. But the e-mail contains no information about the scope or
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nature of the proposed amendments, and an e-mail so thin on detail does not suffice to
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demonstrate VIA’s diligence in moving to amend. Similarly, the October 4, 2016, e-mail from
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VIA promises a copy of the proposed amendments but also does not provide any specifics about
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the amendments themselves. Dkt. No. 196, Bhakar Decl., Ex. 3.
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Finally, the case VIA cites to support its argument that three months is not too long to
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establish diligence is distinguishable. In Vasudevan Software, Inc. v. International Business
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Machines Corp., the court found that a party was diligent despite a four-month delay when its
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reason for seeking an amendment was new information obtained in discovery. No. C09-05897 RS
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(HRL), 2011 WL 940263, at *3 (N.D. Cal. Feb. 18, 2011). Because the new information was
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unclear, the court determined that a longer investigation was justified. Id. Here, however, the
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basis for the proposed amendment is an adverse claim construction. VIA had notice of the
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construction that was ultimately adopted starting in late 2015. Under these circumstances, the
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court is not persuaded that VIA has acted diligently in moving to amend.
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If the court determines that the party seeking leave to amend has not acted diligently, there
is no need to consider the question of prejudice to the non-moving party. O2 Micro Int’l Ltd. v.
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Monolithic Power Sys., Inc., 467 F.3d 1355, 1368 (Fed. Cir. 2006). The court thus declines to
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consider the question of prejudice, especially given that fact discovery has already closed.
CONCLUSION
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For the reasons explained above, the court denies VIA’s motion for leave to amend its
infringement contentions.
IT IS SO ORDERED.
Dated: 1/30/2017
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HOWARD R. LLOYD
United States Magistrate Judge
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United States District Court
Northern District of California
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