OpenTV, Inc. et al v. Apple Inc.

Filing 107

ORDER GRANTING DEFENDANT'S MOTION TO STRIKE. Re: Dkt. No. 85 . Signed by Judge Nathanael Cousins. (lmh, COURT STAFF) (Filed on 6/9/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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OPENTV, INC., et al.,

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United States District Court
Northern District of California

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Plaintiffs,

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ORDER GRANTING DEFENDANT’S
MOTION TO STRIKE

v.

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Case No.15-cv-02008-EJD (NC)

APPLE INC.,

Re: Dkt. No. 85

Defendant.

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Defendant Apple Inc. moves to preclude plaintiff OpenTV from asserting

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conception and reduction to practices dates other than those identified in OpenTV’s

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October 15, 2015, disclosures under Patent Local Rule 3-1(f) and 3-2(b); to preclude

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OpenTV from relying on supporting documentation other than what was specifically

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identified in OpenTV’s Patent Local Rule 3-2(b) disclosures; to strike all earlier

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conception and reduction to practices dates proposed in OpenTV’s subsequent

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interrogatory responses; and to limit OpenTV to asserting a conception date at the end of

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the date range it proposes for the ‘169 patent—June 30, 2001. Dkt. No. 85 at 2. OpenTV

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opposes the motion. Dkt. No. 91.

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I.

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BACKGROUND
Plaintiffs OpenTV, Inc., Nagravision, SA, and Nagra France S.A.S. (collectively,

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“OpenTV”) sue defendant Apple Inc., alleging that Apple infringes U.S. Patent Nos.

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6,233,736 (the ‘736 patent), 7,055,169 (the ‘169 patent), and 7,725,740 (the ‘740 patent).
Case No. 15-cv-02008-EJD (NC)

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Apple contests the validity of these patents.
On October 15, 2015, OpenTV served its Patent Local Rule disclosures under rules

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3-1(f) and 3-2(b). Dkt. No. 85-3, Exh. 1. In those disclosures, OpenTV asserted “a

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priority date at least as early as” the priority date “stated on the face of” each asserted

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patent. Exh. 1 at 6.
On November 23, 2015, Apple served interrogatories on OpenTV, including one

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requesting, the “circumstances surrounding the conception and reduction to practice”

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including “the specific dates that you contend each claim was conceived.” Dkt. No. 85-4,

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Exh. 2 at 12. Apple also served requests for production requesting supporting

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documentation for any alleged dates of conception. Dkt. No. 85-12, Exh. 10 at 7-10.
On December 23, 2015, OpenTV provided its interrogatory response, identifying

United States District Court
Northern District of California

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the same bates range of 500 pages that it had previously listed with its October disclosures.

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Dkt. No. 85-4, Exh. 2 at 12-14.
In mid-February, after the parties met and conferred, OpenTV identified a

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conception date of September 14, 1995, for the ‘736 patent, which predates some of

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Apple’s prior art. Dkt. No. 85-7, Exh. 5. On March 14, 2016, OpenTV stated that it might

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allege a conception date for the ‘740 patent which predates the filing of the patent and

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some of Apple’s prior art. Dkt. No. 85-9, Exh. 7.

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II.

DISCUSSION

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Apple moves to preclude OpenTV’s disclosures under Federal Rule of Civil

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Procedure 16(f)(1)(C), which permits the Court to issue any just order regarding discovery,

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including sanctions for failure to obey a scheduling order.

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In support of its motion, Apple points to two decisions form this district directly on

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point. In Harvatek Corporation v. Cree, Inc. et. al., Case No. 14-cv-5353 WHA, 2015 WL

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4396379 (N.D. Cal. July 17, 2015), Judge Alsup struck the patent holder’s “open-ended”

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conception date. Judge Alsup reasoned that the Patent Local Rules are designed to make

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parties more efficient by stating with particularity the claims early in the case. Id. at * 2.

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Additionally, Judge Alsup concluded that the patent holder’s late disclosure of a
Case No. 15-cv-02008-EJD (NC)

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conception date prejudiced the accused infringer by creating “shifting sands,” which the

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local rules were designed to prevent. Id. at * 3.

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In Thought, Inc. v. Oracle Corp., Case No. 12-cv-5601 WHO, 2015 WL 5834064

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(N.D. Cal. Oct. 7, 2015), Judge Orrick similarly granted the accused infringer’s motion to

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strike a late-disclosed invention date. Judge Orrick noted that Patent Local Rule 3-2(b)

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requires the party alleging infringement to provide “all documents evidencing the

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conception . . . of each claimed invention, which were created on or before the date of

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application for the patent in suit or the priority date identified pursuant to Patent L.R. 3-

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2(f), whichever is earlier.” Id. at * 5. Judge Orrick concluded that this includes disclosure
of the conception date. Id. (citing Blue Spike, LLC v. Adobe Sys., Inc., 14-cv-1647 YGR

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United States District Court
Northern District of California

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(JSC), 2015 WL 335842, at * 7 (N.D. Cal. Jan. 26, 2015)).

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In response, OpenTV argues that this case is different from Thought and Harvatek

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for two main reasons. First, OpenTV argues that it need not disclose a conception date

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according to the local rules, only a priority date. Second, OpenTV argues that in the other

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cases, plaintiff was seeking to rely on newly produced documents, and those documents

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were the subject of the motions. Here, Apple is preemptively moving to prevent OpenTV

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from relying on documents supporting an earlier conception date at any point in the future

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of the litigation. As such, OpenTV argues that it is prejudiced because it cannot

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demonstrate good cause, since the argument is hypothetical, not concrete.

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As to the first argument, OpenTV is correct that the Patent Local Rules explicitly

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require disclosure of a priority date. Patent L.R. 3-2(b). A priority date refers to the date

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of the earliest filed patent application. 35 U.S.C. § 119. “Generally, a patent is awarded to

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the first party to reduce an invention to practice, unless the other party can show that it was

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the first to conceive an invention and that it exercised reasonable diligence in later

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reducing the invention to practice.” Mahurkar v. C.R. Bard, Inc., 79 F.3d 1572, 1577

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(Fed. Cir. 1996)). A conception date will necessarily predate a priority date. Id. Proof of

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a conception date requires more than the inventor’s testimony, and typically a patent

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holder must provide documentary evidence. Taurus IP, LLC v. DaimlerChrysler Corp.,
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726 F.3d 1306, 1323-24 (Fed. Cir. 2013). A patent holder’s asserted priority and

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conception date is pivotal to the accused infringer’s assessment of relevant prior art. Id. at

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1323.

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In the Northern District of California, the Patent Local Rules require disclosure of

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the priority date and also the documents that the patent holder will use to demonstrate an

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earlier conception date. Patent L.R. 3-2(b), 3-2(f). In addition to the disclosures under the

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Patent Local Rules, Apple served interrogatories on OpenTV seeking specific conception

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dates for each asserted claim. In its responses, OpenTV did not identify a specific

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conception date for the ‘736 patent. However, in February 2016, OpenTV identified a
conception date for the ‘736 patent of September 14, 1995, which predates the priority date

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United States District Court
Northern District of California

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on the face of the patent by a year and a half.

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The Court agrees with Judge Orrick’s reasoning in Thought that OpenTV had an

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obligation to disclose its conception date and the relevant documents to support the

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conception date under the Patent Local Rules. Additionally, OpenTV failed to answer

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Apple’s interrogatory in a timely manner.

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As to OpenTV’s second argument, the Court disagrees with OpenTV that Apple’s

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request to prevent OpenTV from asserting any other conception date is premature. Federal

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Rule of Civil Procedure 26 (requiring initial disclosures), the Patent Local Rules, and the

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Court’s case management schedule set forth deadlines by which the parties can reasonably

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expect to understand the nature and scope of the dispute at issue in a given case.

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Additionally, Apple had a one-year deadline to determine if it would challenge the patents-

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in-suit as invalid in an IPR proceeding. Thus, it is not premature to expect that the parties

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disclose key information in the case early and in accordance with the scheduling deadlines.

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III. CONCLUSION

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In conclusion, the spirit of the patent local rules is to ensure early crystallization of

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the parties’ theories, and specifically, to place the burden on the plaintiff to quickly decide

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on and disclose the contours of its case. See Atmel Corp. v. Information Storage Devices

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Inc., No. 95-cv-1987 FS, 1998 WL 775115, at *2 (N.D. Cal. Nov. 5, 1998); Harvatek, 14Case No. 15-cv-02008-EJD (NC)

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cv-5353 WHA, 2015 WL 4396379, at *3.
The Court GRANTS Apple’s motion to preclude plaintiff OpenTV from asserting

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conception and reduction to practices dates other than those identified in OpenTV’s

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October 15, 2015, disclosures under Patent Local Rule 3-1(f) and 3-2(b); to preclude

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OpenTV from relying on supporting documentation other than what was specifically

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identified in OpenTV’s Patent Local Rule 302(b) disclosures; to strike all earlier

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conception and reduction to practices dates proposed in OpenTV’s subsequent

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interrogatory responses; and to limit OpenTV to asserting a conception date at the end of

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the date range it proposes for the ‘169 patent—June 30, 2001.
Any party may object to this ruling within 14 days. Fed. R. Civ. P. 72(a).

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United States District Court
Northern District of California

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IT IS SO ORDERED.

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Dated: June 9, 2016

_____________________________________
NATHANAEL M. COUSINS
United States Magistrate Judge

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Case No. 15-cv-02008-EJD (NC)

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