Leader Technologies Inc. v. Facebook Inc.

Filing 567

Official Transcript of Pretrial Conference held on 07-01-10 before Judge Leonard P. Stark. Court Reporter/Transcriber Leonard A. Dibbs. Transcript may be viewed at the court public terminal or purchased through the Court Reporter/Transcriber before the deadline for Release of Transcript Restriction. After that date it may be obtained through PACER. Redaction Request due 7/26/2010. Redacted Transcript Deadline set for 8/3/2010. Release of Transcript Restriction set for 10/1/2010. (lad)

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UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF DELAWARE

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LEADER TECHNOLOGIES, INC., a :

CA. NO. 08-862-LPS

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Delaware corporation

July 1, 2010

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:

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Plaintiff-Counter Defendant

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v.

:

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FACEBOOK, INC., a Delaware

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corporation

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2:30 O'clock p.m.

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Defendant-Counterclaimant

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............................. :

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TRANSCRIPT OF PRETRIAL CONFERENCE

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BEFORE THE HONORABLE LEONARD P. STARK

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UNITED STATES MAGISTRATE JUDGE

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APPEARANCES:

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For the Plaintiff:

POTTER, ANDERSON & CORROON.

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BY:

PHILIP A. ROVNER, ESQ.

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JONATHAN CHOA, ESQ.

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-and-

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KING & SPALDING.

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BY:

PAUL J. ANDRE, ESQ.

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BY:

JAMES HANNAH, ESQ.

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BY:

LISA KOBIALKA, ESQ.

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For the Defendant:

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BLANK ROME
STEVEN CAPONI, ESQ.

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-and-

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COOLEY LLP.

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BY:

HEIDI L. KEEFE, ESQ.

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BY:

MARK R. WEINSTEIN, ESQ.

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BY:

JEFFREY NORBERG, ESQ.

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BY:

ELIZABETH STAMESHKIN, ESQ

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Court Reporter:

LEONARD A. DIBBS
Official Court Reporter

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P R O C E E D I N G S

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THE COURT:

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ALL COUNSEL:

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THE COURT:

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Let's begin by noting your appearances for the record.

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MR. ROVNER:

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Good afternoon, everybody.
Good afternoon.
Welcome, or welcome back as the case maybe.

Your Honor, Phil Rovner from Potter,

Anderson & Corroon for the plaintiff, Leader.
With me from King & Spalding is Paul Andre, Lisa

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Kobialka, James Hannah and sitting in the back is John Choa from

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my office.

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MR. CAPONI:

Steve Caponi from Blank Rome.

With me

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today is Heidi Keefe, Mark Weinstein, Jeffrey Norberg.

I have

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to look at the name to get it right, Elizabeth Stameshkin.

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THE COURT:

Welcome again.

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Of course this is the time for our pretrial conference.

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Let me tell you how we're going to proceed today.

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First, I'm going to give you the court's ruling on the

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Motions in Limine and the Daubert motion.

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have a brief argument if either parties wishes to be heard on

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Summary Judgement.

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cover the remaining Summary Judgment motions, if you wish to

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argue them.

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Then we're going to

I'll give you up to twenty minutes aside to

Then we'll go through some of the matters that are
addressed in your proposed pretrial order.

And then after that,

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we'll cover a few additional matters.

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aware we have a second pretrial conference scheduled for July

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16th, I think it is, the last business day before the trial

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which begins on July 19th.

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So, without any further adieu, let me give you the
rulings on the Motions in Limine.

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First, Facebook motion number one, all of the Facebook
motions are at DI 412.

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I think everybody is

Facebook motion number one is to preclude any Doctrine
of Equivalents argument.

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This motion is denied having reviewed Dr. Vigna's

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expert report.

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standard, and in particular, Dr. Vigna gives approximately 25

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pages of analysis, four paragraphs of analysis for each claim

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element and, therefore, it is adequate.

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The court finds that it satisfies the Aquatext

Dr. Vigna will be permitted to give that Doctrine of
Equivalents testimony.

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Let me know that I will attempt to exercise it, but if

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any expert, be it Dr. Vigna or any other expert testifies beyond

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the scope of his expert report, you can make an objection to

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that effect at trial, the objection will be noted.

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trial you believe that you have a good faith basis to persist in

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that objection then you can brief that objection following

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trial.

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court that the expert testified beyond the scope of his or her

If following

If you prevail on that objection and can prove to the

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expert report.

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proffered the inappropriate expert testimony will be paying the

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costs for the new trial.

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trial.

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following the trial.

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If a new trial is ordered, the party that has

You can note the objection during the

It won't be resolved during the trial.

Brief it

And as I have said, if you prevail on that motion, a

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new trial will be necessary and the other side will pay the

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costs for that.

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Next, Facebook motion number two:

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To preclude evidence or argument from Dr. Vigna and

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argument beyond the three use cases disclosed in Dr. Vigna's

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expert report.

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examples as Dr. Vigna indicates in his report and in his

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testimony.

That motion is denied.

The three use cases are

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Also the fundamental architecture of Facebook is part

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of what is accused here and that accusation is part of what is

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being tried here and is part of Dr. Vigna's report.

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Again, I'll emphasize if Dr. Vigna goes beyond the

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scope of his expert report, you can object and the procedural

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will be as I have outlined it.

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Vigna will not be viewed as testifying beyond the scope of his

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report simply by talking about something other than the three

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use cases.

However, my ruling is that Dr.

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Next, is Facebook motion number three:

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To preclude Leader from using the term platform to

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refer to Facebook's product.

This motion is denied.

The risk

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of confusion here from it's use of the word platform is minimal.

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And in the court's view is no greater than the risk of confusion

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from the multiple redactions that would be required if we were

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not to permit the use of the word platform.

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That redacting would be somewhat burdensome.

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believes that the jury can understand the various ways that the

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parties are using the word platform.

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The Court

Next is Facebook's motion number 5:
To exclude the deposition errata sheet of Jeffrey Lamb.

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That motion is denied.

The Court has previously ruled, in the

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court's view the changes in the errata sheet are not

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substantive.

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Next, is Facebook motion number 6:

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To exclude Leaders late-produced non-disclosure

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agreements.

That motion is denied.

As explained in the

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telephone conference of last week, June 25th, I believe it was,

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and in the court's view, Facebook has received sufficient

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discovery into the NDAs and into the affirmative defenses of the

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on-sale bar and public demonstration.

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The court has attempted, I believe, that it has

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carefully balanced the many factors at issue here throughout the

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discovery process.

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several discovery disputes.

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has balanced all of the competing factors appropriately such

This issue came up -- aspects came up during
Again, the court believes that it

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that Facebook has had sufficient opportunity to pursue that

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defense and will be permitted to present that defense at trial.

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The court sees, therefore, no basis to preclude Leader from

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using the NDAs as evidence.

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Next is Facebook motion number 7:

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To exclude references to other litigation involving

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Facebook or Mr. Zuckerberg.

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This motion is granted in part and denied in part.

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Leader can use prior deposition testimony from other

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cases for proper impeachment, but when Leader, if they are to do

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so, should just identify the prior testimony by date, not by

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case name or number.

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the substance or issues that may have been involved in any other

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litigation.

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there is no significant risk of unfair prejudice from the use of

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the testimony.

There will be no discussion by anyone of

And with these conditions, the court believes that

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Next, Facebook's motion number 10:

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To preclude Leader testimony on topics which Mr.

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McKibben claimed privilege at his deposition.

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This one is also granted in part and denied in part.

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Leader is precluded from using privilege as a sword when it's

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already been used as a shield at his deposition.

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Mr. McKibben will not be able to offer opinion

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testimony as to novelty.

However, he is permitted to testify to

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the facts of his invention.

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That takes us to Leader's Motion in Limine number 1, DI

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417.

Leader motion number 1, DI 417 is to exclude portions of

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Mr. Greenberg's expert testimony.

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part and denied in part.

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This motion is granted in

It appears to the court that there are three different

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issues.

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analysis on obviousness, including obviousness based on basic

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internet functionality.

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that.

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Issue one has to do with the sufficiency of the

The motion is denied with respect to

So Mr. Greenberg is permitted to testify on those topics.
The motion is also denied with respect to issue 2,

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which had to do with the doctrine of incorporation by reference.

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That is a legal issue for the court.

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agree under the Advanced Display System of the Federal Circuit.

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Here, the court finds that the requirements are met.

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and Seliger references do identify the prior patents by number,

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thereby, they sufficiently incorporate by reference the other

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materials satisfactorily for purposes of anticipation and

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obviousness.

It appears the parties

Lamping

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On issue 3, the Motion in Limine is granted, meaning

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that Mr. Greenberg may not offer testimony as to what the PTO

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examiner would or would not do had certain materials been

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disclosed.

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facts that certain prior art is not cited on the face of the

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'761 patent.

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However, Mr. Greenberg may testify to the undisputed

Next we have Leader's motion number 2, which is DI 418

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to exclude portions of the testimony of Mr. Kearns.

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granted in part and denied in part.

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from any expert as to whether the Leader product is effective.

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To the extent that Dr. Vigna was intending to testify to the

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fact of the effectiveness of the Leader product.

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extended to Dr. Vigna as well.

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issue that remains in this trial.

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testimony about the effectiveness of the Leader product would

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risk jury confusion.

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This is

There will be no testimony

This rule is

It is simply not relevant to any
It goes to damages and

However, Mr. Kearns will be permitted to testify with

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respect to the ensnarement issue as that relates to the Doctrine

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of Equivalents, and, therefore, is permitted in the court's view

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under the Dupuy case cited in the briefs.

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If either party proposes, the court will give a

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limiting instruction that Kearns' testimony regarding Yahoo and

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e-Bay goes solely to rebut the Doctrine of Equivalents.

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not evidence of invalidity.

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what I have said is okay, is acceptable.

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as it goes to, in the courts view, Doctrine of Equivalents,

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which is an infringement issue and does not go to validity.

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It's

But Kearns' testimony other than
It will be permitted

Next is Leader's motion number 4, to exclude evidence

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of reexamination, DI 420.

That motion is granted.

The

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reexamination is not relevant to the issues in the case.

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is a substantial risk of jury confusion given the different

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standards applied by the PTO and here in court.

There

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If Leader does open the door by misrepresenting what

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happened before the PTO, which is not relevant, then as with any

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misrepresentation, the court will take appropriate corrective

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action at the time.

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Next is Leader's motion number 5, DI 421, to exclude

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the on-sale and public disclosure defense.

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denied.

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This motion is

As I have already indicated, the court attempted, I
believe, did manage discovery appropriately, weighing all the

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competing factors that go to the production of the NDAs and the

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and these defenses.

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timely manner under all the circumstances.

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permitted the opportunity to prove these defenses to the jury.

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And then Leader motion number 6, DI 422, to exclude a

The defense was raised insufficiently in a

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product to product comparison.

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And Facebook will be

no product to product comparison.

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This is granted.

There will be

Facebook may introduce evidence of Leader to Leader as

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part of its on-sale bar and public disclosure affirmative

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defenses, but that's not a product to product comparison.

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That takes care of the Motions in Limine.

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There are two remaining Daubert motions.

I'll give you

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my rulings now.

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to between the parties and it's pretty well settled.

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The legal standard on these motions was agreed

The motions to exclude evidence are committed to the
court's discretion.

Even though the expert testimony raises a

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question of law governed by Rule 702, expert testimony under

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that rule is admissible if it is based upon sufficient facts or

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data, if it is a product reliable principles and methods, and if

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the witness has applied the principles and methods reliably to

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the facts of the case.

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The Third Circuit has described these three distinct

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restrictions as qualifications for reliability and fit.

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Rule 702 does embody a liberal policy of admissibility.

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And

The Third Circuit has also ruled that it is an extreme
sanction not normally to be imposed to exclude expert testimony.

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Having reviewed the two remaining motions to exclude

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testimony which are both Facebook motions and having applied

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those standards to the arguments and the evidence there, I find

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that Leader has met its burden to establish the qualifications

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for reliability and fit of both Dr. Vigna and, I believe, they

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are doctors.

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Forgive me if I'm promoting them and Dr. Herbsleb.

And I find no basis for imposing on Leader the extreme

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sanction of precluding expert testimony or departing from the

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liberal policy of admissibility.

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Also, I note that I believe Facebook's concerns can be

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addressed properly on cross examination.

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exceptions to what I have just said and both relate to Dr.

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Herbsleb.

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There are only two

With respect to Dr. Herbsleb, I'm granting the motion
to exclude only in two limited respects.

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First, Dr. Herbsleb cannot testify that certain prior

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art is not incorporated by reference, given that the court has

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found and ruled as a matter of law that it's sufficiently

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incorporated by reference.

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was number five in the motion, which has to do with the

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materiality of certain prior art references.

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solely to the inequitable conduct defense which is now part of

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the forthcoming trial.

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And, second, the issue that I think

That issue goes

Dr. Herbsleb will not be permitted to testify to

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matters that go solely to inequitable conduct, but in all other

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respects, the two Facebook motions to preclude evidence are

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denied.

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That takes us to the Motions for Summary Judgment.

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MS. KEEFE:

Regarding the limine's -- one of the

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limine's that was denied as being deferred had to do with

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copying, hacking, those types of things.

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I understand that those issues were denied and,

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therefore, deferred.

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wanted to make 100 percent clear that though issues are not to

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come up, right?

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in this case about copying or hacking?

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Those issues are not in this case.

I

There is no evidence that should be presented

THE COURT:

That was certainly my understanding from my

review of the motions.

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Mr. Andre, do I have that incorrect?

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MR. ANDRE:

Your Honor, it would depend on exactly what

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Facebook brings up.

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I think it was inducing infringement.

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of copying which we don't believe is the law.

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are arguing in the jury instructions.

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They are bringing up issues right now for,
There has to be showing
That's what they

There is also the issue of a possible secondary

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consideration of non-obviousness which is copying as well.

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At this point, we are not settled on it.

I don't know

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if it's relevant to bring those up at this time or not, but we

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can talk to counsel about it.

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THE COURT:

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At this point, there's not to be any

reference to hacking or copying.

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You have my ruling from last week.

It's the court's

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view that there's no place in this trial that's forthcoming for

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those types of allegations to be part of this case.

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MS. KEEFE:

Thank you, your Honor.

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THE COURT:

That take us to the Summary Judgment

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motions.

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remaining.

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I believe there are -- there is either four or five
I believe they are all Facebook motions.

If you wish to be heard today on them, you can have up
to twenty minutes as you wish with respect to those motions.

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MS. KEEFE:

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Could I have one second to give you the best order.

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THE COURT:

Absolutely, yes.

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MS. KEEFE:

Could we start with number three, which is

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Absolutely, your Honor.

our Motion for Summary Judgment of non-infringement?

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THE COURT:

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wish to go in.

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Your time.

Let's go in the order that you

Whoever is doing the argument should come to the

podium.

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MS. KEEFE:

Twenty minutes for the motions?

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THE COURT:

All of them, whatever you like.

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MS. KEEFE:

Perfect.

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Would you like us to reserve a little bit of rebuttal

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time?
THE COURT:

If you want to reserve some, just let us

know so we can be sure to cut you off.
MS. KEEFE:

We would like ten minutes of rebuttal, ten

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minutes on our argument themselves.

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pretty well.

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respond to something new that may come up.

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I think our papers speak

We want to answer your Honor's questions and

MR. WEINSTEIN:

Facebook Motion for Summary Judgment

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number three granted would entirely dispose of this case.

It's

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a very narrowly focused motion that is directed at Leader's

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failure to prove one essential claim element that is present in

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every asserted claim.

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that is associated with the users' data, be automatically

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updated in a response to the users' movement to a separate

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context work space or user environment.

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claims -- different terminologies where they are describing the

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context, user environment or user work space.

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requirements in the claims is the same.

That's the requirements that MetaData

Different independent

But the

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MetaData must be automatically updated in response to
the users' movement.

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The only issue to be addressed for Summary Judgment

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motion number three is the failure of proof on that essential

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element.

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language as well as Judge Farnan's claim construction of the

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word dynamically.

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That particular element is borne out by both the claim

With respect to the evidence, your Honor, there are no
genuine issues of material fact with respect to this motion.

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The only evidence that has been put in by us is the expert

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report of their expert, the screen shot that their expert

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produced and the deposition testimony of their expert.

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All those sources confirm that Dr. Vigna doesn't have

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an opinion on whether or not the accused aspects of the Facebook

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website perform this one missing element.

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have it in his report.

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He simply doesn't

In his deposition he was asked whether or not he had an

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answer to the question of whether Facebook performed it.

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said I can't answer the question.

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available to me.

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He

I don't have that information

So, the only issue addressed by that motion is the
missing element.

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I'll briefly address the counter-statement that Leader

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filed in connection with -- pursuant to Judge Farnan's standing

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order.

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The counter-statement has a lot of information whereby

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other claim elements, other parts of the tracking component

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limitation.

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They are not at issue in this motion.

If you look very carefully at their counter-statement,

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you're not going to find any evidence that any MetaData is

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automatically updated in response to the users' movement.

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just not there.

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It's

And Dr. Vigna's admission on that with respect to all
three of the use cases which are the only use cases for which he
provides the required analysis is simply not there.
THE COURT:

It's not a factual dispute as to whether

the MetaData has to be automatically updated?

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MR. WEINSTEIN:

Correct.

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That's a pure question of claim construction for your

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Honor to resolve.

We think that issue has already been resolved

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by Judge Farnan's claim construction of the word dynamically in

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the claim construction that he put out.

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MR. WEINSTEIN:

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MS. KEEFE:

Thank you.

Your Honor, I'll take a couple of minutes

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to talk very briefly about motions number one and two, that is

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the IPXL motion and Muni Auction motion.

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I think our briefing on the remaining two issues, prior

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art, on-sale bar motion as well as the Shorts motion essentially

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speak for themselves.

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them, I'll let those papers speak for themselves.

Unless your Honor has questions about

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On IPXL.

This is an issue that your Honor could

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completely eliminate eight claims from this case, substantially

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narrowing the case that has to go to the jury again on a pure

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legal issue.

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IPXL is a case which stands for the prospect -- very

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well established prospect that hybrid claims, that is that

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claims that claim both a system and a method within the same

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claim are by definition indefinite.

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In the case of the claims in this case, the problem is

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that the alleged infringer cannot necessarily know whether their

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actions simply infringe when they purchase the product or have

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it sitting there, or if it's not until actually an action is

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taken by a user.

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the actual meets and bounds of the claim are.

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So the public is not put on notice as to what

In this case, the claims at issue all talk about a

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apparatus that is then accessed by a user or employed by a user.

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And those are the two active verbs that are utilized.

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If Leader had actually wanted these claims to be purely

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functional, they could have drafted them that way, in which case

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she would have used language along the lines of can be accessed

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or is accessible as opposed to the user, active verb accessing.

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With respect to the word employee.

In fact, if your

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Honor turns to the claims at issue in this case, claim 21 in

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particular, Leader actually demonstrates that it knows how to

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use that active voice -- passive voice rather, and actually does

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so.

Part of the claim talks about the user employed the data so

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that it requires the user to take a step.

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phrase the patent talks about data that can be accessed in the

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passive voice.

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the active voice accesses which requires the user to perform an

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activity, and other claims we have Leader claiming something

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that can be accessed and thereby claiming functional language.

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But in the very next

So in separate claims we have Leader both using

Here Leader used the active voice and must be stuck
with it.

The only thing that is not in our papers is that

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there's actually two cases that I would pass on to your Honor to

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the fact that you cannot simply rewrite claim language to change

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the tense of a verb, change it to something else.

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In the Rembrandt versus AOL case found at 673 F. Supp

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2d 420 at 426.

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with a desire to change what people in that case were arguing

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was a simple word processing type error.

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that the court cannot redraft the claims to make them operable

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or sustain their validity, instead, quote, courts must construe

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the claim as written, not as the patentees wish they had written

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them.

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The court was specifically dealing in that case

And the court said

That case cites to a Federal Circuit case called Chef

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America vs. Lamb-Weston at 358 F 3rd 1371, a Federal Circuit

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case of 2004.

Another IPXL case.

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In that case, -- I'm sorry that's not an IPXL case.

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That's a case where they wanted to redraft the language

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of the claim.

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batter being raised to a temperature of 450 to 800 degrees.

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Through the rest of the specification it seems as though really

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the oven that should have been raised to that temperature

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because if the cookie batter were in that temperature it would

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be a cinder.

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In that case, the claim talked about a cookie

The court said despite the fact that it would

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potentially render the claim meaningless, you simply cannot

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rewrite the claim.

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IPXL would take out eight of the claims and make this
case narrower and much easier for the jury.

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It's stuck with the language that it had.

THE COURT:
claim.

You start with the premise of a hybrid

Why is that not a factual issue?
MS. KEEFE:

Again, IPXL is a pure matter of law because

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what the meaning of the term is and how they are applied is a

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matter of claim construction for your Honor.

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So the fact that the words says user accesses or user

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employed, that's a claim construction issue for your Honor to

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decide that requires the user to actually take an action where

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the rest of claim actually calls out an actual apparatus.

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Again, that's a claim construction issue.

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issue of law.

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So, a pure

pure issue of law for the judge.

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The IPXL case itself is very clear this was a

The second case, your Honor, Muni Auction case deals
with issues of divided infringement.

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Now, in our case, very, very similar to the actual Muni

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Auction case and the other cases that we cite, it doesn't appear

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that the parties necessarily disagree that there are elements in

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the claims that require Facebook to perform some action and

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Facebook users to perform other actions.

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The disagreement seems to be whether or not Facebook

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actually controlled the action of those users.

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extent, there's an argument made, we contend, of course, that

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Facebook does not control any of our users.

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And to that

In fact, Facebook would perhaps argue that it may wish

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to do so but it simply can't.

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log on to.

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once they arrive there.

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It provides a service that people

It's their choice to use it or not and how to use it

The terms of service in Facebook's case do not dictate

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as a contract would how the Facebook site is used.

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simply give the ability for the Facebook website to be used.

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Rather,

In Muni Auction, the question becomes is there

18

direction or control over the end-users.

19

not.

20

to the level of direction or control regarding Facebook

21

employees when they are doing testing, not their personal use of

22

Facebook which is outside their employment.

23

that they may do while they are working at Facebook at the

24

direction of Facebook.

25

In this case, there is

The only argument that Leader has advanced which may rise

But the testing

In this case there has been no allegation of damage

21

1

based on that internal use.

2

goes to the notion that where there is no allegation of damages

3

has been raised for that particular liability, there is no right

4

to a jury trial.

5

This is not a damages issue.

It

In fact, we actually have a case, your Honor, In Re

6

Technology Licensing Corporation at 423 F. 3rd at 1286, where

7

the Federal Circuit held that there is no right to a jury trial

8

where only equitable relief is sought for a given instance.

9

Since there is no allegation of a single direct

10

infringer which involves third party users of Facebook because

11

there is no control or direction over those third party users,

12

the only thing left would be internal use.

13

Internal use, under their own expert, there's no theory

14

of damages by the internal use.

15

injunction.

16

So, all that's left is the

trial on this issue.

All that would be left is a bench trial.

17

Thank you, your Honor.

18

MR. ANDRE:

No jury

19

this.

20

are now.

21

judgments.

22

Your Honor, I know the court is aware of

I do want to remind the court of how we got to where we
We have not had a chance to fully brief these summary
We wish to brief them.

We dispute the facts.

One of the things I note is both counsel talked about

23

this was a claim construction issue in both arguments.

Claim

24

construction has come and gone in this case.

25

those issues were brought up in claim construction and they lost

In many instances

22

1

on them.

2

necessarily, if it is though, we would like a chance to brief

3

that.

4
5

This is not the time to revisit those issues

My colleague, Mr. Hannah, will be arguing all three
motions.

6

THE COURT:

7

MR. HANNAH:

8

I will go in the same order that Facebook went.

9

Fine.
Thank you, your Honor.
I will

start with Facebook's Motion for Summary Judgment motion number

10

three.

11

non-infringement argument that was raised in rebuttal to Dr.

12

Vigna.

13

This is clearly a factual issue here.

This is a

This was not raised by anybody else.
Dr. Vigna provided an opinion that Facebook contains

14

components including a context component and a tracking

15

component that infringe on the '761 patent.

16

In that he applied the court's claim construction

17

dynamically which is automatically in response to the preceding

18

event.

19

Kearns said that there was no automatically and in response to a

20

proceeding event performed by the tracking component in the '761

21

patent.

22

In rebuttal to Dr. Vigna's non-infringement opinion, Dr.

They are entitled to do that.
This is a non-infringement factual issue for the jury

23

to decide whether or not that those actions are actually

24

performed and the components exist in the Facebook architecture

25

on the backend.

23

1

New, even though the claims don't require automatically

2

and in response to movement as counsel indicated, Dr. Vigna

3

actually did provide that opinion in his expert report.

4

look in his expert report, he talks about the tracking cookie as

5

located on the backend side.

6

does update MetaData in response to a user moving simply from

7

context to context.

8
9

If you

That tracking cookie, actually,

Now, that is part of the tracking component system.
Part of the architecture that is used by Facebook.

That is not

10

the sole basis.

11

modules that are in the backend system such as the new V system,

12

such as the mini-V system, such as all the modules that work

13

together from the front end that were displayed, which is called

14

the mini-feed.

15

They also have other components and other

So all these issues are factual issues.

We're saying

16

they infringe.

Facebook is coming back and saying they don't.

17

This is simply a non-infringement argument that they have

18

raised.

19

issue that was raised by Facebook.

20

and now it is our position that they are estopped from arguing

21

this now in this case.

22

As Mr. Andre pointed out, this is a claim construction

THE COURT:

And they withdrew this issue

When you say this, what particular claim

23

term did they propose initially and withdraw a request to

24

construe?

25

MR. HANNAH:

They proposed a definition for based on

24

1

the change.

2

MetaData.

3

They also proposed a term -- a definition for
MetaData was rejected from the get-go.

MetaData from Facebook's -- Facebook argued that

4

MetaData required information regarding where the user resides.

5

It was rejected by the court.

6

ordinary meaning.

7

withdrew that definition before it actually got before the

8

court.

9

Facebook proposed in this case.

10

It was given just its plain and

Based on the changes in their meaning, they

The court wanted to narrowed down the 40 terms that

If you look at the claim construction briefing, their

11

position now is completely contrary to what they did argue in

12

claim construction.

13

determine that there are no factual issues.

14

factual issue.

15

testify as to who they believe.

16
17

We will put this in our briefing if you
This is clearly a

It will be up to the jury when the experts

That is Facebook's Motion for Summary Judgment number
three.

18

For Facebook's Motion for Summary Judgment number one,

19

again, this turns out to be a non-infringement factual argument.

20

Facebook raised this for the first time with its

21

non-infringement expert Dr. Kearns in rebuttal to Leader's

22

expert, Dr. Vigna.

23

Dr. Vigna again stated that Facebook contains

24

components and performs methods that infringe on the '761

25

patent.

In rebuttal to that, Dr. Kearns said that's not right.

25

1

G4.

2
3

Facebook actually doesn't access data from a second
context.

4

So it's a factual issue that is going to be determined

5

by the jury whether or not Facebook has components that allows

6

access of data from a second context or whether they don't.

7

Again, this issue was raised in the claim construction

8

briefing.

9

term.

10

And they actually proposed a definition for this

Again, this is accesses the data in their briefing.

You'll see they proposed a term.

11

Even though this was never raised by their validity

12

expert, our validity expert never rebutted it.

13

first time in rebuttal on non-infringement.

14

This was the

I would like to respond to counsel's argument about

15

IPXL.

16

believe that we need to get to the case law issues here.

17

Again, there are numerous factual issues.

I don't

In IPXL, it's all about indefiniteness and

18

understanding the scope of the claim.

19

understood the scope of the claim.

20

it, our validity expert knew it, our infringement expert knew

21

it, their non-infringement expert knew it.

22

understands the scope of the claim.

23

Nobody raised that.

24
25

Here, all the experts

Their validity expert knew

Everybody

There's no confusion there.

Now, IPXL actually states that you have to use the
apparatus in combination.

As your Honor knows it's about -- the

26

1

case is about having use of a apparatus within a method claim.

2

If you look at that there's actually a phrase in there.

3

talks about an input means, where the user uses the input means.

4

The '761 patent doesn't say that.

5

accessing the data from the second context.

6

accessing the context component or using the context component.

7

It's purely functional language.

8
9

The '761 patent says
It doesn't say

This is prevalent in many, many software patents where
you have to have functional language to describe what the

10

components are going to do.

11

to a users' action.

12

It

They are always based in response

That's exactly the case here.

There's a really good analogy that was raised in the

13

Yodlee case.

14

of California case.

15

The Westlaw cite is 3456610.

16

This is a quote from the court.

17

If I can find that.

This was a Northern District

Yodlee can be found at F. Supp 2d, 2006.
And the analogy is as follows:

A simple analogy would be a claim which physically

18

describes a pair of scissors designed to cut paper.

It then

19

states, upon opening and closing the sharp edge of the scissors

20

on a piece of paper, the paper is cut.

21

the capability of the scissors.

22

Infringement occurs upon the manufacturing and selling of

23

scissors that are capable of cutting paper.

The language describes

It is functional language.

24

The IPXL rule would apply only if the patent claim

25

described a -- the physical description of the scissors and

27

1

stated within the same claim and the method of using said

2

scissors to cut a piece of paper.

3

analogous to the former example to describe what the apparatus

4

would do when used in a certain way.

5

the apparatus, thus, they do not recite both an apparatus and

6

method of using that apparatus.

7

The claims at issue here are

They do not claim use of

If you look at the '761 patent, if you look at claim

8

one, for instance, it states, context components, a tracking

9

component.

And then it has certain actions that happen when the

10

user accesses data from the second context.

It doesn't say then

11

a user using the context component and the tracking component.

12

In fact, that's impossible because the context

13

component and tracking component are kept on the backend servers

14

at Facebook.

15

user.

16

They are not going to be an accessible to the

I would also like to note that analogy has been used in

17

several other cases including the Ricoh vs. Katun Corporation

18

case out of New Jersey at 486 F. Supp 2d 395.

19

And there's also be a recent case that came out from

20

the Federal Circuit in which they affirmed the use about

21

functional language in apparatus in technology cases, and that's

22

the Silicon Graphics vs ATI Technologies case.

23

2008-1334-1353.

24
25

That is

It was decided on June 4, 2010.

Again, it talks about functional language there and
that having functional terms a product still infringes as long

28

1

as it contains the component.

2

occur.

3

That allows those functions to

Now, the last motion is Facebook's Motion for Summary

4

Judgment number two.

5

It's a non-infringement argument they have raised.

6

Again, this is another factual issue.

It is unclear from their motion what they are actually

7

arguing here.

8

evidence of direction and control.

9

Leader's infringement expert has opined in relation to claim

10
11

We assume that they are arguing that there is no
This is what Dr. Vigna,

nine, the method claim and dependent claims on that.
In there, Dr. Vigna opines that Facebook has sufficient

12

direction and control over its user to perform these steps.

13

This is part of the direct and he also opines that there is

14

indirect infringement because the users perform these tests.

15

The fact that Dr. Vigna talks about this in his expert

16

report and actually talks about it during the deposition is

17

enough to show that there is sufficient evidence should Dr.

18

Vigna be allowed to testify regarding the direction and control

19

that Facebook has over its users.

20

Of course, terms in use and service contract that it

21

has with its users is going do govern what the user have to

22

perform that should be sufficient direction and control.

23

that is a factual issue for the jury to determine whether or not

24

that is sufficient or not.

25

Again,

Facebook employees, of course, are under the direction

29

1
2

and control of Facebook.
Facebook may contend it's not.

Again, that's a factual

3

issue for the jury to decide whether or not being an employee of

4

Facebook and using the Facebook website is sufficient for there

5

to be direction and control.

6

Now, Dr. Vigna's report.

He comes up with numerous

7

documents.

8

with other contracts that were and the actions and testing every

9

Facebook website by Facebook employees.

10

As I mentioned, the terms of use, he backs it up

Again, in this case, the claims require the components,

11

and that's for the apparatus claims.

There's a factual dispute

12

whether Facebook has those components.

13

Dr. Vigna has also provided sufficient disclosure in his expert

14

report to opine that there's indirect infringement and there's

15

indirect infringement by the direction and control of Facebook.

For the method claims,

16

Thank you, your Honor.

17

THE COURT:

18

MR. WEINSTEIN:

19

I'm going to briefly address Mr. Hannah's comments with

20
21
22
23
24
25

Thank you.
Thank you, your Honor.

respect to Summary Judgment Motion three.
First, very briefly.

Mr. Hannah suggested something

about the timing of the non-infringement argument.
The arguments were presented in our interrogatory
responses dated from last year.

So there is no issue there.

With respect to his reference to Dr. Kearns, we don't

30

1

have to rely on Dr. Kearns here to present our motion.

2

Yes, Dr. Kearns presented an opinion that Facebook did

3

not satisfy this element.

4

to satisfy this motion.

5

this element is not satisfied either.

6

We don't need to rely on his report
Dr. Vigna's report establishes that

Quoting from the transcript of his deposition at page

7

145.

He was asked directly when the users navigates his own

8

profile page to a friend's profile page, do you have an opinion,

9

one way or another as to whether that active navigation will

10

cause MetaData to be dynamically updated in the second context?

11

His answer was I really need to see the source code to answer.

12

I really can't answer that.

13

knowledge you have, you cannot answer that question, correct?

14
15
16

Answer:

So sitting here right now with the

I don't have the data I would need to answer

that question.
The reason he couldn't answer the question, your Honor,

17

is because he did not analyze that issue.

18

analysis is based on the assumption that the MetaData update,

19

what he claims is a MetaData update, doesn't happen when the

20

user moves.

21

His infringement

It's when the user takes other affirmative action.

On paragraph 93 of his report, he says the MetaData of

22

the user is automatically updated in response to the user

23

posting the storage on the friend's wall.

24

claim language of dynamically but not in the context of user

25

moving, but in the context of the user taking affirmative steps

So he's using the

31

1

on the second context to effectuate what he claims is the

2

MetaData change.

3

With respect to the claim construction issue, your

4

Honor.

The way it came about was a lot of terms were proposed

5

for construction.

6

number of terms down to a select few.

7

asked to be construed was the word dynamically, precisely

8

because we didn't believe that they could show the Facebook

9

website dynamically updated the MetaData under the construction

10

we proposed.

11

Judge Farnan told the parties to limit the
One of the terms that we

adopted.

12

That was the construction that Judge Farnan

After that construction of our non-infringement

13

argument, the position that we somehow withdrew our claim

14

construction position or that we're estopped from arguing it, I

15

don't think there's any basis for that.

16

Thank you, your Honor.

17

MS. KEEFE:

18

I have a few comments both on numbers one and two.

19

With respect to the IPXL motion, we're actually not

Thank you, your Honor.

20

relying on Dr. Kearns at all.

21

issue of claim construction for your Honor.

22

Again, we think this is a pure

And the argument here is not that there needs to be a

23

separated definition what it means to access.

It is the fact

24

that accesses is a verb in an active sense that must be

25

performed by the user as opposed to the functional language, can

32

1

be accessed or accessible.

2

has to come up here.

3

That's the claim construction that

If your Honor finds that the word accesses is in fact

4

an active verb requiring action by the user, then IPXL will

5

demonstrate that this is a hybrid claim.

6

There was no expertise needed.

No experts needed.

7

It's a pure issue of claim construction law.

8

of the words used.

9

Based on the sense

And if your Honor has any doubt as to how those words

10

should be construed, the remaining claims in the patent

11

demonstrate that they actually did know how to use functional

12

language.

13

opposed to the active sense of employed and access.

14

where IPXL problem comes in.

15

For example, can be accessed, can be employed as
That's

In terms of the Yodlee case, I do absolutely agree that

16

in Yodlee that was a functional language.

17

is that in Yodlee they talked about things happening upon

18

opening, not where the user opens the blade.

19

case they used a form which is functional, not the active form

20

of the verb.

21

they did in IPXL and in GPA Patent Holdings vs. Panther, there

22

would be a problem of indefiniteness.

23

The distinction there

Again, the Yodlee

Had they used the active form of the verb like

With respect to the Muni Auction issue of direction or

24

control, the Muni Auction case, I think is perhaps the single

25

most informative thing I can point your Honor to.

33

1

In Muni Auction itself, the court found in a Motion for

2

Summary Judgment that control -- that by simply controlling

3

access to a system and instructing the bidders, in that case,

4

that was an online bidding site.

5

giving access to the system and telling people how to use it,

6

there was not sufficient direction or control to incur liability

7

for direct infringement.

8

court to decide up much in the same way the court looks to the

9

term of a contract and defines them as a matter of law.

10

Not unlike e-bay by simply

In fact that was up to the to the

You can find whether or not the terms of use, terms of

11

service here make sufficient direction or control.

12

We think they absolutely do not.

13

I think, your Honor, unless your Honor has any other

14

questions.

15

THE COURT:

Okay.

16

Let me tell you where we are on Summary Judgment.

I'm

17

not prepared to rule on the merits right now on the remaining

18

Summary Judgment Motions.

19

What I will do in time is either deny the motions.

If

20

I'm not ready to deny the motion, I will be asking for the

21

completion of the full briefing on them.

22

we're going to have the trial on July 19th.

23

know yet what the timing will be on the further briefing and on

24

Summary Judgment if I do find I need it.

25

further on Summary Judgment.

But in any event,
And I just don't

You'll hear from me

34

1

What I want to next do is turn to the proposed pretrial

2

order and talk about some of the issues there as we look forward

3

to trial.

4

As previously announced, there is going to be

5

separation of issues, and specifically, as you all know, I have

6

separated out from the trial that will is begin Leader's claim

7

of willful infringement, Leader's claim for damages and

8

injunctive relief and Facebook's counterclaim and defense of

9

inequitable conduct.

10

The first matter that I want to discuss with you is the

11

length of the trial.

I'm going to give each side a certain

12

number of hours over a certain number of days.

13

the separation of issues and the other rulings that you've

14

gotten I'm definitely interested in the parties views at this

15

point as to how long they anticipate needing?

16

from Mr. Andre.

And in light of

We'll hear first

17

MR. ANDRE:

Thank you, your Honor.

18

Ms. Keefe and I have actually been conferring on this.

19

We're pretty much in line.

20

were in the case that it would be a seven day trial, something

21

along that line.

22

about six days.

23

We were thinking when the damages

We now both agree that we can both do it in

If you look at the five hours average court day, maybe

24

15 hours each, something along those lines.

25

pretty close to agreement.

I think we're

I don't know what your Honor is

35

1

thinking.

2

THE COURT:

That's pretty much what I was thinking.

3

Let me hear from Ms. Keefe.

4

MS. KEEFE:

I don't think -- we are talking about.

5

Trying to come up with something both useful for your Honor and

6

for the jury.

7
8

THE COURT:

All right.

You can have a seat.

You'll

get a chance to talk and stand up again shortly.

9

In light of the separation of issues and the factual

10

legal disputes that will be tried, the claims at issue, the

11

accused product that's in dispute, having reviewed the witness

12

and exhibit lists and having heard from counsel as well having

13

some familiarity with the practice in this court with timed

14

trials and length of trials, I do find that it will be most

15

appropriate to have a times trial.

16

six days.

17

Probably all of you know the way we keep track of time.

18

Essentially, if you're on your feet, that time is being charged

19

to your side.

20

We're going to limit it to

Each side will be given 15 hours to present its case.

We'll begin on Monday July 19th at 9:30.

We'll start

21

subsequent trial days at 9:00 o'clock.

22

from 9 a.m. to 1:00 p.m. on those subsequent days and break an

23

hour for lunch and then go from 2:00 to 4:30.

24

minute break in the morning and in the afternoon.

25

The plan will be to go

A single 15

We will be meeting down here in court room 2A for the

36

1

trial.

2

Other issues on the pretrial order.

3

MS. KEEFE:

With respect to time.

Does your Honor have

4

a desire to separate out limits for opening statement and

5

closing arguments, or just leave it as a single bucket to be

6

used by the parties?

7

THE COURT:

Single bucket of 15 hours.

8

the 15 hours, you'll be done.

Okay.

9

All right.

If you get to

Looking at the pretrial order.

10

page three, Roman Numeral III topic.

11

First, at

that are admitted which will require no proof.

12
13

There's a handful of facts

What do the parties intend to do to make those facts
known to the jury?

14

Mr. Andre?

15

MR. ANDRE:

Your Honor, I believe we were intending on

16

having those in the jury instructions.

17

stipulate to these facts.

18

The parties will

either party in the case.

They don't have to be proved by

19

THE COURT:

Ms. Keefe, is that correct?

20

MS. KEEFE:

It is, your Honor.

The only reason I'm

21

hesitating at all, I'm looking at them to see if they have these

22

facts that are no longer relevant.

23

THE COURT:

As long as they are going to be in the jury

24

instructions, you'll all be resubmitting the jury instructions.

25

You can take care of that issue.

37

1

Number IV, issues of fact and law to be litigated.

Of

2

course, I looked at your proposed outlines in light of

3

separation of issues.

4

had been initially set out.

5

revised pretrial order.

6

the issues of fact and law to be tried should be delineated as

7

follows.

8
9
10

Certainly it's much narrower than what
And I will be having you submit a

In that Pretrial Order -- excuse me,

Number one as listed on exhibit A1 number one as given
by Leader.

And then numbers two and five A2, which is

Facebook's statement.

11

The equitable defenses including laches are not going

12

to be tried in front of the jury as part of this trial.

13

are deferred to a later trial or trials if necessary.

14
15

Next matter Roman Numeral V, I believe, objections to
trial exhibits.

16
17

They

Let me first ask.

Has there been any further meet and

confer with respect to this issue?

18

MS. KEEFE:

There has been, your Honor.

Again, we've

19

actually been talking about the fact that we both understand the

20

need to reduce the list.

21

were on the telephone conference last week, we've been intending

22

to swap new lists and meet and confer about that, trying to get

23

it down to something that we can talk with your Honor about on

24

July 16.

25

THE COURT:

Given what your Honor said while we

Mr. Andre, that's correct?

38

1

MR. ANDRE:

That's correct, your Honor.

2

THE COURT:

That's fine.

And I appreciate that.

My

3

only hesitation is I'm going to need to see the fruits of your

4

meet and confer in advance of the 16th so I can know how much

5

time we have to put into those issues on the 16th.

6
7

Give me an indication as to how far in advance of the
16th you think you could give me something?

8

MR. ANDRE:

9

week from tomorrow.

10

A week in advance of the 16th.

MS. KEEFE:

That's a

I was debating given how many other things

11

that we have to talk about with each other and continuing

12

depositions.

13

we have until Monday?

14

Could we have at least over that weekend?

THE COURT:

Could

Monday of that week, I think it's the 12th.

15

Okay, that's fine.

16

to objections with respect to the trial exhibits on Monday, July

17

12th, I'm pretty sure is what it is.

18
19
20

We'll look for your submissions with respect

A few things about exhibits just to understand how the
trial will proceed.
All exhibits must come in through a witness.

At the

21

end of each trial day counsel will meet with the courtroom

22

deputy to make sure everybody is in agreement as to what

23

exhibits have been moved into evidence on that particular day.

24

We'll do that again at the end of trial.

25

there's an oversight, I will allow the court record to be

If it turns out

39

1

reopened.

2

We're not trying to trick anybody into failing

3

inadvertently moving something into evidence.

4

Next demonstrative exhibits.

5

I don't as I indicated on the phone, I don't want to

6

leave those issues up in the air until the last minute.

7

sure whether there is going to be disagreement on that.

8

Where do we stand on that?

9

MR. ANDRE:

I'm not

We haven't talk about demonstratives yet,

10

just mostly because we haven't prepared them.

11

todays pretrial conference before preparing those.

12

We're waiting for

I don't know when they would be ready for counsel to

13

exchange them and talk about objections.

14

could do on the 16th, or if we wait until the actual trial

15

begins?

16
17
18

THE COURT:

If that's something we

Let's see if you can address that in your

submission on the 12th.
At a minimum, indicate where you are with respect to

19

demonstratives on the 12th.

My hope is you may have started

20

preparing some and anticipating those issues.

21

MS. KEEFE:

We'll certainly work with each other.

22

THE COURT:

On witnesses, there are some objections

23

that are noted on the witness list which I do want to discuss

24

with you all if they are still live issues.

25

Let me first ask, has there been a narrowing with

40

1

respect to those issues?

2

MS. KEEFE:

Again, we've been meeting and conferring.

3

We were just talking this morning about the possibility of

4

narrowing those lists to each other by Wednesday of next week

5

which could help resolve some issues, I think.

6

the time that would help everybody take another look.

I think given

7

THE COURT:

Sure.

8

MR. ANDRE:

This is a bigger issue for us, obviously,

9

because of the fact they have added so many witnesses on their

10

list that we have not deposed that were not listed in their

11

initial disclosures.

12

from some company.

This is something because we have to do

13

trial preparation.

We would like this issue resolved as soon as

14

possible.

15

THE COURT:

Some of the witnesses are a representative

Let me ask you, there is a reference to a

16

stipulation which seems to be the basis for a large number of

17

your objections, as I understand it.

18

doesn't exist.

19

It says that stipulation

Help me understand where it exists.

MR. ANDRE:

Many of those individuals -- the fact

20

witnesses are listed there were subpoenaed by Facebook for

21

deposition and they withdrew those subpoenas.

22

When we talked to them we had an e-mail exchange.

We

23

told them if you are going to take them off your deposition list

24

we don't want to see them at trial.

25

agreement on that issue.

We thought we had an

41

1
2
3

Now, these people reappeared on the witness list even
though they had withdrawn them from their deposition subpoenas.
Part of a bigger issue, to be honest, your Honor, is

4

the fact without any warning the authors of the prior art showed

5

up on the witness list.

6

Now that's a nice way of trying to get an

expert on

7

the stand.

They were not disclosed to us as a witness at any

8

time prior to getting the witness list.

9

282, we were suppose to get a disclosure of their invalidity

In fact, under 35 USC

10

contentions which we never got, a 282 disclosure.

11

clearly fall within those witnesses for sure.

12

That would

I think they are trying to bring in expert witnesses

13

under the guise of fact witnesses.

We think that would be --

14

one of the biggest issues for the witnesses at this point.

15

THE COURT:

Let's hear from Ms. Keefe on these issues.

16

You can come forward to the podium.

17

MS. KEEFE:

18

I think if we just wait and talk to each other, given

Actually, I don't think it will.

19

the length of the trial this probably won't be an issue.

20

make all the arguments why everything we disclose was disclosed.

21

I'm not sure it's even going to be necessary.

22

I can

If your Honor would allow us to do exactly what we

23

asked and what we talked about, I don't think this is going to

24

be an issue.

25

THE COURT:

Okay.

You reasonably believe you can

42

1

resolve this by July 12th?

2

MS. KEEFE:

Absolutely.

3

THE COURT:

Mr. Andre, I can give you all the chance to

5

MR. ANDRE:

I hope that's the case, your Honor.

6

THE COURT:

I hope so, too.

7

Okay.

4

8

do that.

When we do get to trial, the examination of

witnesses will be limited to direct, cross and redirect.

9

Where do the parties stand on how far in advance that

10

you are going as to disclose your order of witnesses to one

11

another?

12

Do you need more time to confer on that?

13

MS. KEEFE:

I'm not sure that we actually talked about

14

order, instead we talked about the names of the witnesses

15

themselves.

16

no problem with that.

17

If you wish we can do it at the same time.

I have

And I also assume once a witness was put on you

18

would -- they would be up for all purposes?

For example, if Mr.

19

McKibbin was put in direct in their case, I would just use him

20

right then and there and put on my defense right then and there

21

instead of calling him back again, back later.

22

THE COURT:

Mr. Andre?

23

MR. ANDRE:

I would object to that.

24

be here for the entire trial.

25

If they want to call him up in their case, they can certainly do

Mr. McKibbin will

He will be our representative.

43

1

that.

2

defense in the midst of it.

3

THE COURT:

Ms. Keefe?

4

MS. KEEFE:

I just think it is far more efficient and

5
6

I don't want to confuse the issue of our case with their
That's prejudicial to our client.

far more logical for all of the issues to come up at once.
If the witness is on the stand especially vis-a-vis

7

some of my witnesses if they have to travel, the notion of

8

putting them up once and getting all the issues resolved and

9

having them sit down.

10
11
12
13

That works better for everybody since

many of the issues very much overlap.
THE COURT:

Do you anticipate this to be an issue other

than with Mr. McKibbin?
MS. KEEFE:

I don't know because I haven't seen their

14

list of our witnesses yet.

15

case, but I may want to bring them up in mine.

16
17
18

THE COURT:

They may not bring them in their

Mr. Andre, might this issue for someone

other than Mr. McKibbin?
MR. ANDRE:

I can't imagine it would be.

If they want

19

to bring Leader witnesses -- usually, you do this for the

20

convenience of witnesses who are out of town.

21

For our witnesses it's not an inconvenience if they

22

want their witnesses to be put up for all purposes, we'll

23

stipulate to that.

24

their case.

25

In our case, we don't want them putting on

That would be prejudicial to us.

THE COURT:

I'm not going to require Mr. McKibbin or

44

1

the Leader witnesses to be put up only once for all purposes.

2

But if Facebook wishes to do that with their witnesses, then I

3

understand there's an agreement that you will be permitted to do

4

that.

5

MS. KEEFE:

I do only have one scheduling issue with

6

respect to witnesses and we can definitely deal with this now.

7

I would raise it now anyway.

8
9

When the trial got moved, Dr. Kearns had a prior
commitment on the evening of the 21st and 22nd where he has to

10

be in Washington, D.C.

11

before that and after that.

12

place.

13

He's not available.

He is available

I'm sure we can try to find him a

It may be that it ends up being out of order.
THE COURT:

I'm going to leave the it to you all to

14

confer, to see if you can fit him in to an anticipated points

15

that makes sense.

16

issue with me.

17
18
19

If you can't, then you'll have to raise that

The witnesses will be sequestered unless the parties
otherwise agree.
I've already told you with respect to the scope of

20

expert testimony, if you believe an expert is going beyond the

21

scope of what was in their expert reports, note your objection

22

and we'll deal with it post-trial with the appropriate sanctions

23

that I talked about previously.

24
25

Let's talk about deposition designations and the
objections.

I assume there's going to be a great deal of

45

1

narrowing there as well?

2

Mr. Andre?

3

MR. ANDRE:

I believe that's correct, your Honor.

4

Based on the court's ruling on Friday, there will be a

5

considerable narrowing.

6

you at the same time that we have our exhibit list.

We can work those out and have those to

7

THE COURT:

Ms. Keefe?

8

MS. KEEFE:

Agreed.

9

THE COURT:

The process I want to follow with any

10

remaining objections to deposition designations is that -- what

11

you'll need to do is put together a package for us, all the

12

deposition testimony that either side is designating or

13

counter-designating.

14

Where there are objections, the proponent of the

15

testimony should just mark right on there with a highlighter say

16

yellow, exactly what the proffered testimony is.

17

objecting party can write up to one sentence in the margin what

18

the basis for the objection is and write a one sentence response

19

right there in the margin.

20

counter-designation and objections.

21

And the

Use a different color where it is

We'll take a full packet.

If you can get it to us by

22

the 12th, great.

As long as I have it by the start of the

23

second pretrial conference, that will be fine.

24

to tell me at least 48 hours in advance when you intend to use

25

that deposition testimony for that particular witness and we'll

Then you'll need

46

1

get you our rulings on the objections 24 hours a head of time so

2

you'll know what deposition testimony you can use.

3

Mr. Andre?

4

MR. ANDRE:

Your honor, with respect to the

5

sequestering of witnesses, are you going to permit the parties

6

to have one witness here throughout the trial?

7

THE COURT:

At the table, you mean?

8

MR. ANDRE:

At the table, usually one witness is

9

designated to see the trial.

10

THE COURT:

11

Any objection to that?

12

MS. KEEFE:

13

If Mr. McKibbin is going to be up and down and up down

Obviously, Leader's witnesses.

That was my intent.

Absolutely.

14

and up and down again, then I think he would have to be

15

sequestered.

16

up and let us do everything then he can sit there the whole

17

time.

18
19

If, on the other hand, they are willing to put him

We have no problem with that.
MR. ANDRE:

We're not willing to have him up once.

We

do intend to use him in our rebuttal case.

20

THE COURT:

Do you have anybody else?

21

MR. ANDRE:

He would be the only person that we would

22

have at the table.

23

and founder.

24

representing Leader.

25

He's the inventor and the CEO of the company

He's the person that should be the person

THE COURT:

The objection to that is based?

47

1

MS. KEEFE:

He's the main witness for their entire

2

case.

If he's being put up for a very small purpose and listen

3

to everything everybody else says and then he's put again for

4

another small purpose and then listens to everything everybody

5

else says, it's unfair and prejudicial.

6

reasons why we asked that once a witness goes up, their

7

testimony goes through, then they can sit back in the courtroom

8

the rest of the time if they like.

9

That's one of the

If they would like Mr. McKibbin to be able to sit

10

through the trial which I completely understand why they would

11

want to do that, then they simply need to put Mr. McKibbin up

12

once for all purposes and then he can sit in the courtroom the

13

rest of the time.

14

No problem.

THE COURT:

Mr. Andre, I agree.

You're going to have

15

to make a choice either have him testify all at once or have him

16

sit there for the whole trial, otherwise that seat can be taken

17

from someone in the company or be empty.

18

MR. ANDRE:

19

I understand that is for the sequestration of fact

20

witnesses.

21

Thank you, your Honor.

experts?

22

Are experts allowed to attend the testimony of other

THE COURT:

My ruling is that all witnesses are

23

sequestered unless the parties agree otherwise.

If you can

24

agree if you want to limit it to experts or fact witnesses, you

25

can do that by agreement.

48

1

Let me move on to some other matters.

2

If it's necessary to state any objections during the

3

trial, I want you to keep -- I don't want speaking objections.

4

Just state the rule in a sentence or less for the basis of your

5

objection.

6

from you.

7
8

I'll call you to sidebar if I need to hear further

Transition statements are fine and, in fact, encouraged
to help the jury understand where we are in the case.

9

With respect to exhibits, I guess given the technology

10

at stake, we're not going to be using a lot of paper documents

11

and books.

12
13

What do you envision with respect to how you actually
display exhibits?

14

MR. ANDRE:

We would prefer to actually hand out jury

15

books for each juror of the paper exhibits that we intend to use

16

to the extent that we will project them up.

17

something electronic in nature and not paper, we'll do so like

18

that.

19
20

If they are

They won't have every exhibit in their book, obviously,
but a great many.

That's what we would be intent on doing.

21

THE COURT:

Ms. Keefe?

22

MS. KEEFE:

That sounds reasonable to me.

I know

23

absolutely there will be paper exhibits, more than you think in

24

a case like this.

25

They will be viewed on monitors as well as the larger screen.

However, they will definitely be projected.
I

49

1

agree that it would be nice to have them in a jury book.

2

work together on that.

3
4
5
6

THE COURT:

I trust that you can work together.

We can

I

didn't mean to be derogatory to the old fashioned paper world.
MS. KEEFE:

I think you would be surprised how many

there still are.

7

THE COURT:

8

How are we going to deal with confidential information

9
10
11

I'm already surprised.

including the source code and when the court is going to be open
or closed?
I have an obligation I think to keep the court open

12

absolutely as much possible.

13

exceptions.

14

MS. KEEFE:

I know there maybe some

We started discussing this among ourselves,

15

and at least when the source code itself is being displayed,

16

we're in agreement that the courtroom will be closed when the

17

source code is being displayed.

18

everything else.

We can work out almost

19

THE COURT:

Okay.

20

What would you envision to be a mechanism to let me and

21

those in the courtroom that need to know, okay, source code is

22

coming or that is the source code?

23

people who aren't permitted to be in the courtroom.

24
25

MS. KEEFE:

We need to usher out certain

My guess is that it will only come in

through two witnesses.

When those two witnesses are called,

50

1

we'll be able to tell your Honor far enough in advance, like

2

such today is Dr. Vigna.

3

code, displaying it.

4

Dr. Vigna will be using the source

During his testimony we would like the courtroom to be

5

closed.

We can get you a list of other people who can't stay in

6

the courtroom.

We can work on that together.

7

THE COURT:

Mr. Andre?

8

MR. ANDRE:

We obviously agree.

9

We tried a case here

last year and a half ago in front of Judge Sleet.

That's how we

10

handled it when we got to the source code.

11

witness, I announced to Judge Sleet that we would be presenting

12

source code and we should clear the courtroom.

13

the presence of the jury.

14

courtroom.

15

record and unseal the courtroom at that time.

No problem.

I was presenting a

We did that in

They walked out of the

When we finished it, we let Judge Sleet unseal the

16

THE COURT:

Okay.

17

MR. ANDRE:

It will be the attorneys responsibility to

18
19
20
21

let your Honor know that we are presenting source code.
THE COURT:

Fine.

We'll make it the

presenting

parties, their responsibility.
I do want to make sure that at least some portion of

22

every witness' testimony is open.

23

perhaps Dr. Vigna, for example.

24

least see who he is and answer some questions.

25

MS. KEEFE:

It maybe very little for
The public is entitled to at

His background and things like that.

Once

51

1

you start talking about the functionality of the code and the

2

code itself rather than trying to parse which one is functional

3

and which one is code.

4

THE COURT:

Right.

5

You should be striving to segregate the public part

6

from the non-public part probably.

7

to do first.

8
9
10

I'll leave it to you which

It seems to me obvious.

MR. ANDRE:

Your honor, we do have an issue with the

source code that I would like to bring up today.

I don't know

if this is a good time.

11

THE COURT:

Now is as good a time as any.

12

MR. ANDRE:

We asked for the source code that Dr. Vigna

13

examined to be brought to court on the same computer that he

14

examined it on obviously in the same manner that it was kept in.

15

We spent hundreds of hours examining the code as it exists, that

16

is, that stand alone laptop computer.

17

Facebook's counsel is that they don't want to bring that code to

18

the courtroom.

19

with the code to some degree which would make Dr. Vigna -- all

20

of his previous work pretty much starting from square one again.

21

My understanding from

They want to bring certain modules, monkeying

We're going to bring this up maybe on 16th and earlier

22

that we would like to have the source code on the laptop

23

computer as Dr. Vigna examined it and about a based his report

24

on to be used at trial.

25

THE COURT:

Let me hear from Ms. Keefe.

52

1

MS. KEEFE:

Your Honor, the problem with that is we're

2

absolutely fine with having the code as it was displayed to them

3

brought to Delaware so it can be in the courtroom on the stand

4

stand alone computer.

5

However, what we've been asking is that they tell us

6

which portions of the code that they are actually going to put

7

in evidence and use.

8
9

There are numerous portions of the code that are
completely irrelevant to this case.

10

What we're simply asking is that they like any other

11

swath of exhibits tell us which part.

12

parts.

13

There are many irrelevant

We don't want them used in the case and put in evidence.
THE COURT:

They will be on a stand alone computer but

14

just won't be moved into evidence is what you're suggesting, I

15

feel?

16

MS. KEEFE:

Correct.

17

THE COURT:

Mr. Andre, does that address your concern?

18

MR. ANDRE:

It does, your Honor.

19

THE COURT:

Sorry to bring it up.

20

We could have

resolved that easily.

21

As long as we have the code in the stand alone computer

22

Dr. Vigna can rely upon the code that he cited in his expert

23

report.

24
25

That's all we want.
MS. KEEFE:

As long as they don't start putting other

pieces of the code that has never been in anybody's report

53

1

before, that's fine with us.

2

THE COURT:

3

If they do, we have a mechanism for dealing

with that.

4

MS. KEEFE:

Thank you, your Honor.

5

THE COURT:

Let's talk a little bit about jury

6

selection.

7

For example, we're going to use what they call the

8

struck juror method which is how Judge Farnan has selected

9

jurors.

Hopefully, Delaware counsel can explain it to you if

10

you are not already aware.

11

eight.

12

through the strikes for cause.

13

five preemptories.

14

I intend to end up with a jury of

I plan to have 18 jurors potential jurors after we get
That will leave each side with

I reviewed the proposed voir dire.

15

are largely in agreement.

16

It seems to me you

a result of what you've given me.

17

I'll be able to prepare voir dire as

One issue I do need a little help on is whether or not

18

you envision that I instruct jurors not to use Facebook during

19

the course of the trial.

20

Mr. Andre, do you have a view on that?

21

MR. ANDRE:

22

The Facebook phenomenon is obviously taken over the

I do, your Honor.

23

world to some degree.

I know there are some individuals that

24

view their daily use of Facebook as essential as eating and

25

breathing.

We obviously have an issue with those jurors on the

54

1

jury panel for cause when that comes.

2

doesn't think it's part of their daily life that they would

3

need, we would like an instruction that they not be on Facebook

4

and testing out the infringement or validity theories or

5

whatever it is.

6

To the casual user who

That would preclude, I guess, some individuals who

7

don't think they can deal with Facebook for more three hours at

8

a time.

9

MS. KEEFE:

For two weeks.

10

THE COURT:

Certainly, we'll be exploring in the voir

11

dire and for the cause inquiries those -- what peoples' views

12

are of Facebook if it's as important as food.

13

I think we still are going to be left with an issue of

14

basically is part of the general instruction not to investigate

15

the case, you must refrain from using getting on Facebook for

16

the length of trial.

17

Ms. Keefe?

18

MS. KEEFE:

Even though I haven't had a chance to

19

confer with my client about it, obviously he's never going to

20

want me to tell people not to use Facebook.

21

My personal impression is that the limiting instruction

22

typically not doing your own research, conducting your own

23

research would mandate that they not use Facebook because who

24

knows what they will think by virtue of testing it out and using

25

it.

55

1

I'm not sure I can give you a definitive answer right

2

now.

3

that it would be better for all of us if they did not use it

4

during trial.

5

I apologize for that.

THE COURT:

By the same token my inclination is

That is my inclination as well.

I'll leave

6

it to the parties to -- if it turns out that you have a

7

strenuous objection to that, you'll have to raise it.

8

intent to instruct the jurors just to refrain.

9

to be six days at this point.

10

It's my

It's only going

Hopefully, they can get by

without Facebook for that long.

11

On the preliminary jury instructions.

We'll play the

12

video.

Both parties are requesting that we play the video on

13

the patent system.

14

to the burden of proof on invalidity.

15

whether it is clear and convincing or preponderance.

It appeared there was a dispute with respect
There was bracketing

16

Does Facebook have an argument on that point?

17

MS. KEEFE:

This is an area of law that is currently I

18

think in a state of flux.

This is actually an issue that has

19

risen all the way up to the Supreme Court then the case settled

20

before the Supreme Court actually decided the issue.

21

There have been a number of cases.

And Mr. Weinstein

22

who is far smarter in case names -- I'm sure he can give them to

23

your Honor if your Honor is interested.

24
25

There are a number of cases where the burden regarding
prior art that was never disclosed or never considered by the

56

1

patent office should actually be left.

2

The presumption of validity presumes you get a

3

presumption of validity based on the fact that the patent office

4

has done its job.

5

patent comes out and as a result you get a higher degree of yes,

6

this is a good patent.

7

validity over those references.

It considered a number of references, the

In other words, a presumption of

8

What we're saying is that burden, and that the

9

presumption should be lower viz-a-viz references that were never

10

placed in front of the Patent Office in the first instance.

11

That's really what the law change seems to be all

12

about.

13

in the Deepfor vs Microsoft case.

14

appeal as to whether or not there was a lower burden regarding

15

references that had never been disclosed to the Patent Office

16

and therefore had never been considered, specifically granted

17

cert on that issue.

18

have it resolved for us.

19

There was actually a jury instruction that was rejected
That issue was certified for

Unfortunately, the case settled.

We don't

We know this is an issue of first instance for your

20

Honor and perhaps for the Delaware Court.

21

important issue.

We think it's an

This is a great case to take it up in.

22

THE COURT:

23

Mr. Andre, do you think this is a great case to take it

24
25

Thank you.

up in?
MR. ANDRE:

Your Honor, I'm going to let Ms. Kobialka

57

1

address it.

2

MS. KOBIALKA:

Thank you, your Honor.

3

Aside from the hundreds of years of juris prudence, the

4

standard that is set forth is clear and convincing evidence.

5

The Federal Circuit just as recently in the I4I case said the

6

standard of proof here is clear and convincing evidence.

7

not to be a lower standard for references that may not have been

8

before the patent office.

Its

9

That deals with some of the issues that we had raised.

10

They are attempting to make this argument that this information

11

wasn't before the Patent Office and our expert has said that the

12

Patent Office has looked at this type of information,

13

cumulative.

14

before.

It is the type of things that they have seen

15

You can't have it both ways.
The law is pretty clear.

It's clear and convincing

16

evidence.

It's something that you know we can try to suggest

17

change but you have the statute that says presumption of

18

validity which also appropriate for a patent issue.

19

THE COURT:

Thank you.

20

I've heard enough, Ms. Keefe.

I'm going to instruct

21

the jury that your burden on invalidity is clear and convincing.

22

I understand the argument the law maybe moving in that

23

direction.

24
25

I think your objection is now on the record to my
instruction and we'll see what happens.

58

1

MS. KEEFE:

Thank you.

2

THE COURT:

You're welcome.

3

I do want to have revised preliminary jury instructions

4

in light of everything that I ruled on.

5

If you can get those to me on the 12th that will be

6

helpful.

7

they are any remaining issues on the 16th.

8
9

I will then have a chance to review them and see if

In terms of the final jury instructions.

At the close

of the evidence I do want you to give me a revision on those as

10

well.

I can take that.

Have them into me by the 14th so I can

11

take a look at it.

12

you my rulings on whatever objections remain until we get into

13

the trial.

14

you are before we have the pretrial conference.

I may not.

I'm not promising that I'll give

At least I would like to have a chance to see where

15

Do you have a question about that?

16

MS. KEEFE:

Not about that.

17

THE COURT:

Just so you know, it's up to you to decide

18
19

I have another question.

how to perfect the record for appeal.
In my view all proposed jury instructions that you put

20

in -- that you may put in as we go forth are part of the record.

21

I view them as exceptions to whatever my final instructions turn

22

out to be.

23
24
25

I believe the last thing that I had on my list is that
I do need a revised Pretrial Order.
I would like to have that by the 14th as well so I can

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take a look at that before we meet on the 16th.

2
3

Ms. Keefe, is there anything else would you like now to
raise now?

4
5

MS. KEEFE:

When Ms. Kobialka made her argument, it's

on a different point.

6

I understood your Honor's ruling regarding the expert

7

testimony on cumulativeness to go to the issue of materiality

8

and therefore was not in this case any further, and so there

9

would be no evidence regarding the cumulative nature of the

10

prior art before the Patent Office?

11

THE COURT:

Mr. Andre, do you want to address that?

12

MR. ANDRE:

That was a separate portion of their motion

13

regarding Dr.

14

Herbsleb.

You've denied that aspect of it.

With respect to materiality, that was with respect to

15

just the four references, whether material or not, an

16

inequitable conduct claim they were attempting to bring at the

17

time.

18
19
20

So you have two different things.
Your Honor has based on your previous ruling denied

that aspect.

I have their Daubert motion, I believe it was.

THE COURT:

I'm going to have leave it to counsel to

21

confer on this.

22

still need to address with respect to it, put it in the

23

submission on the 12th that's coming.

24

an answer to that question right now.

25

If there remains a dispute that you think I

MS. KEEFE:

I appreciate it.

I simply can't give you

Thank you, your Honor.

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THE COURT:

Anything further Ms. Keefe?

2

MS. KEEFE:

Not that I can think of right now.

3

THE COURT:

Mr. Andre?

4

MR. ANDRE:

Just a couple of housekeeping matters.

5

Last Friday you had ordered Leader to produce some privileged

6

logs of Mr. Zax (phonetic) documents.

7

closed. They were on vacation, small office.

Mr. Zax's office was

8

Monday there was a death in the family.

9

We were able to -- he wouldn't ship the box to us that

10

though we thought he would.

We gave him a shipping labels to

11

ship them to us, he didn't.

We had a copy service pick them up

12

and scan them onto a disk and we got them today, this afternoon

13

by FedEx overnight delivery.

14

we could have until Wednesday of next week to get the privileged

15

logs done.

16

with electronic data.

17

did order us.

18
19

We talked to counsel.

We hope to get it done by then.

There's a problem

Hopefully, it will be fine.

Your Honor

And I wanted to put that on the record.

THE COURT:
circumstances.

They said

I appreciate the update and the

It sounds like you're doing the best you can.

20

MR. ANDRE:

A couple of questions we had.

21

You had mentioned injunction would be out of the case.

22

We also obviously -- there should be no mention of a possibility

23

of an injunction through this case since injunction is not in

24

play, is that correct?

25

THE COURT:

Correct.

There should be no reference to

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1

what might happen after this trial.

2

MR. ANDRE:

This may not be decided ye, but is there

3

any indication as to -- and the reason we're doing this, we're

4

representing a small company that we have to plan for.

5

When the second phase of the trial goes forward, is

6

there a indication it's going to happen immediately or is there

7

going to be some time out from the first trial for planning

8

purposes?

9

THE COURT:

Have you conferred with Ms. Keefe on it?

10

MR. ANDRE:

We have not conferred yet.

11

THE COURT:

I'm going to have you confer on that, if

12

you can, if not -- you can and will update me as to status and

13

your views on that on the 12th.

14

by the l5th, but I'm not promising you that you will have an

15

answer by the l5th.

16

THE COURT:

Is there anything else, Ms. Keefe?

17

MS. KEEFE:

I'm told one last thing.

18

Your honor, at the current stage there are eleven

We'll try to have a draft on it

19

claims still at issue in this case, four independent with a

20

series of dependent claims.

21

Judgment Motions could limit the number of claims.

22

that is too many for a trial as short as we're proposing at this

23

point.

24
25

Obviously, some of the Summary
We think

The claims are very much overlapping and we would
actually request that your Honor limit the scope of the trial to

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1

one independent with the attendant and dependent claims perhaps

2

two, to workable for jury.

3

THE COURT:

Mr. Andre?

4

MR. ANDRE:

Your Honor, I think we have 15 hours.

5

We

can get those 11 claims in very easily.

6

As I mentioned previously, a year and a half ago we

7

tried a case in front of Judge Sleet.

8

did it in 7 days.

9

There were 43 claims.

We

This is not burdensome.

The fact that these claims are very different in

10

nature.

11

component on the back end on the servers, claims relate to

12

machinery medium.

13

sets of claims.

14

time.

15

Some are apparatus claims.

Some are in regard to the

There are method claims as well.

Three large

There's no reason to limit the numbers at this

THE COURT:

I'm going to deny the request.

The time

16

limits will take care of hopefully anybody wasting any time.

17

the plaintiff wants to present its case with respect to the

18

If

eleven claims, I'm going to leave that up to the plaintiff.

19

THE COURT:

Anything else, Ms. Keefe?

20

MS. KEEFE:

Not that I can think of.

21

THE COURT:

Mr. Andre?

22

MR. ANDRE:

Nothing.

23

THE COURT:

We'll look for submissions that we talked

24
25

about.

We'll see you on the 16th.
Thank you all very much.

63

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(At this time, court concluded.)