Specht et al v. Google Inc et al

Filing 14

TRANSCRIPT OF PROCEEDINGS held on 05/07/09 before the Honorable Harry D. Leinenweber. COURT REPORTER CONTACT INFORMATION: Krista Burgeson, [e-mail], 312-435-5567. IMPORTANT: The transcript may be viewed at the court's public terminal or purchased through the Court Reporter, Krista Burgeson, before the deadline for Release of Transcript Restriction. After that date it may be obtained through the Court Reporter, Krista Burgeson, or PACER. For further information on the redaction process, see the Court's web site at www.ilnd.uscourts.gov under Quick Links select Policy Regarding the Availability of Transcripts of Court Proceedings. Redaction Request due 6/16/2009. Redacted Transcript Deadline set for 6/26/2009. Release of Transcript Restriction set for 8/24/2009. (Burgeson, Krista)

Spechtetalv.GoogleIncetal

Doc.14

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vs.

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

ERICH SPECHT, et al., Plaintiffs,

GOOGLE, INC., et al., Defendants.

) ) ) ) ) ) ) ) )

No. 09 C 2572 Chicago, Illinois May 7, 2009 9:30 o'clock a.m.

TRANSCRIPT OF PROCEEDINGS - MOTION BEFORE THE HONORABLE HARRY D. LEINENWEBER APPEARANCES:

For the Plaintiffs:

LAW OFFICE OF MARTIN J. MURPHY MR. MARTIN J. MURPHY 2811 RFD Long Grove, Illinois 60047 847-540-8899

For the Defendant, Google, Inc.:

GREENBERG TRAURIG, LLP MR. JEFFREY P. DUNNING MR. HERBERT H. FINN MR. RICHARD D. HARRIS 77 West Wacker Drive Chicago, Illinois 60601 312-456-8400

For the Defendant, Motorola, Inc.:

MR. JOHN CYRLUK

Dockets.Justia.com

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Court Reporter:

FEDERAL OFFICIAL COURT REPORTER MS. KRISTA BURGESON 219 South Dearborn Street Chicago, Illinois 60604 312-435-5567 [e-mail]

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THE CLERK: 09 C 2572, Specht versus Google. MR. MURPHY: Good morning, your Honor. Martin Murphy on behalf of plaintiffs. MR. HARRIS: Good morning, your Honor. Richard Harris, H-a-r-r-i-s, Herb Finn, F-i-n-n, and Jeff Dunning, D-u-n-n-i-n-g, on behalf of defendant, Google, Inc. MR. FINN: Good morning, your Honor. MR. DUNNING: Good morning. MR. HARRIS: We filed our appearance this morning. We understand several of the 47 or 48 defendants have not yet been served. Others have not been served with this motion and the like. We do contemplate and we do anticipate that we will be filing appearances for a good number of those defendants in the near future. We are hear though today solely and exclusively on behalf of Google, Inc. MR. CYRLUK: Good morning, your Honor. John Cyrluk, C-y-r-l-u-k, on behalf of Motorola, Inc. I have not entered my appearance yet. I was formally retained this morning. I was contacted last night around 9:20 to be retained by Motorola. I will be entering my appearance on behalf of Motorola. THE COURT: Is that everybody? Is everybody accounted for? I think I only have four names, and there are five of you.

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Cyrluk.

MR. HARRIS: I gave three names. THE COURT: I have Murphy, Harris, Dunning, and

MR. FINN: Finn, Herbert Finn, your Honor, F-i-n-n. THE COURT: You are the missing party. MR. HARRIS: The missing link. THE COURT: All right. This is a motion for a TRO brought by Mr. Specht. MR. MURPHY: That is correct, your Honor. THE COURT: This morning I was handed, and I don't see the person here, a proposed motion to intervene by a person by the name of Kenneth Robblee. I don't see him in court. He is apparently from the State of Washington, Tacoma, or at least that is where his current lawyer lives, and that is according to his proposed motion. Has anybody seen this? MR. MURPHY: No, your Honor. MR. HARRIS: We have not. MR. FINN: No, your Honor. THE COURT: Well, he claims to have entered into negotiations with Mr. Specht to buy the Android Data Company, but it fell through. I am not sure if -- obviously it is not in order, the motion to intervene as an additional plaintiff, it is not in order. Was this filed electronically, Wanda?

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morning. then?

THE CLERK: Yes, they filed it electronically. THE COURT: So it should be available to everybody

THE CLERK: Actually, he just put it through this

MR. MURPHY: I haven't seen it this morning, your Honor. If I can look at it? THE COURT: You might want to take a look at it. MR. MURPHY: Okay. MR. HARRIS: Very well, your Honor. Is your Honor going to want some kind of position or response this morning, because we will need to consider this and we will need an opportunity to respond. THE COURT: I don't know. I was presented with it last night. I read through what he wrote. How emergent is the emergency? MR. MURPHY: I think it is emergent, however, your Honor, there is one issue where I will stipulate that we have weaknesses, which is basically the balance of harms issue, because Google, obviously being what Google is, and all the parties, they have expended a tremendous amount of money on this product. So, I think although it is basically a reverse confusion case, I do concede the fact that that may be an issue with respect to the four-prong test on the injunction.

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So, your Honor, I would look for guidance on which way the Court is leaning on that issue. I think that the rest is clear cut. We have a valid trademark. We have -THE COURT: Well, unless Google concedes, I would assume that it would take some time to -- at least to obtain a response from them. That is what I am inquiring, I guess. MR. MURPHY: Well, your Honor, I did put in there an alternative, which is basically they do have posted on their web site a statement to the effect that Android is their trademark, and I have asked that it at least be disclosed that Android is the subject of litigation, so they don't claim ownership to something we have got ownership of, we have prima fascia ownership by virtue of the fact that we are on the register. MR. HARRIS: Your Honor, that would constitute parts of a grant of a temporary restraining order, the imposition of some acknowledgment that simply is not true here. And while I don't intend to give counsel guidance on, you know, Google's position on irreparable harm, there are other prongs of the four-prong test that once the Court hears and sees the documentation in this case, this is a clear case of four to five years ago a mark being abandoned by an individual who simply wasn't in business. So right off the

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bat we are getting into the likelihood of success on the merits. We have 18 months of use with dozens of major trade publications identifying repeatedly the software operating platform, operating system nature, of the particular products and software involved here. We concede, as well, that plaintiff has a significant problem with irreparable harm. Now, if I can make a suggestion to the Court, because none of us -THE COURT: I am always looking for suggestions. MR. HARRIS: If I can, your Honor, maybe this would serve as a platform for enabling Google as well as most, if not all, of the other defendants to come back to the Court. We don't believe that there is an emergency here, and we don't believe that potentially changing notice criteria on the web site of one of America's largest companies is really the kind of concession that is suggested by what this case really involves. Can we suggest, your Honor, that instead of even addressing the TRO here today that we put that away, that we go past that, and we look at plaintiff's desire to have a preliminary injunction, which would enable the defendants to be able to respond, be able to show the Court the documentation.

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I can tell the Court right now, Judge, we are prepared to elicit testimony today if you want an evidentiary hearing, we are prepared to go through the documentation with the Court, but then, again, we lose the advantage of having any briefing opportunity here. So, if we can put it off 60, 90 days. Frankly, this individual is -- so far as we know, is not really selling the kinds of things or doing the kinds of things that are claimed, especially since most of these things were resurrected within days of his filing of the complaint in an effort to make it appear as though he is in this business. But without going into that yet, if we can have a date, a return date 60 to 90 days out, with a briefing schedule. I believe the defendants would really appreciate the opportunity to have a briefing opportunity to show you the documents and then come before the Court. We can work out, I am sure counsel and I, an appropriate date for a hearing, and then we can entertain the Court's thoughts on whether it wants an evidentiary hearing or pure argument. I think that would be more relevant, more reasonable, in view of the real circumstances behind this case. MR. MURPHY: Your Honor, we do have -- we have a prima fascia case. We have a trademark, it is registered, and it is in good standing.

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In their documents, their applications for the trademark, they acknowledged my client. They acknowledged that there was confusion. We have the trademark, Android Data. The term data was disclaimed. Basically we have Android for the use of E-commerce software. They are trying to trademark Android basically for software. It is the same product. It is basically for E-commerce. It is to be used -- they call theirs a mobile -I think it is a mobile phone or platform, something along those lines, used for basically computer software to perform applications on a phone. So, I think that we need to preserve our trademark rights. We own the trademark, we have the rights, and that is clear. They have never sought to have our trademark canceled. They could have easily gone to the Trademark Office and said, This trademark is not in existence. Instead, they chose to sit by the sidelines and say, Well, you know what? We think it is abandoned, and we will go on that assumption. So, never having contacted my client they are going off circumstantial evidence that they deem appropriate. THE COURT: Well, from what you told me, though, it would seem to indicate to me that you would probably not be entitled to a TRO if there is a substantial question of

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balance of harm. That implies a rather lengthy, I think, proceeding, at least evidentiary proceeding, that I suppose you could scratch it together. But this is a reverse -MR. MURPHY: Reverse confusion. THE COURT: (Continuing) -- reverse confusion, yes. MR. MURPHY: And we are not saying that people are going to think that Google is our product. MR. HARRIS: Your Honor, plaintiff has premised most of its case on the fact that during the prosecution of Google's trademark, Google's trademark application was blocked because there was a registration there that stays in effect, regardless of whether an applicant or a registrant is using the mark. In fact, the registrant of that mark stopped using the mark not for three years, which is the statutory term for abandonment, but rather for five years, and that was confirmed through a lot of effort and a lot of investigation to make sure that everybody's rights were respected. In reality, what happened is upon taking a good look and possibly talking to some people, including the gentleman who I believe is trying to intervene, because his name actually comes up at one point in these proceedings, your Honor, apparently someone saw an opportunity here, and all of a sudden the old company was reapplied for, a new web site was

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sought, a new screen was put on display, all within four days of the filing of the complaint. We have abandonment, and certainly no one is contesting that there is not a fact as to whether there is a trademark registration and whether that blocked the registrability of Google's trademark application at the PTO. But that is the be all and end all of plaintiff's case. There is no showing of a likelihood of confusion. We have got a reference in there to the fact that purportedly the plaintiff only found out that it was associated with software literally days before he filed the complaint, when for 18 months this was the biggest roll out program, particularly of a software product, within the last two years. Day after day, week after week, notifications, every trade magazine describing this operating system, this software, so there is absolutely no excuse. What we are looking at, potentially, in the balance of hardship, we are looking at somewhere between, it is estimated, $400 to $650, $700 million dollars worth of product and systems that are out there utilizing this protocol. That is for balance of hardships. For irreparable harm we have 18 months of watching this particular mark rolled out, utilized, adopted, and partnered up by 47 other companies. And we have the fact that, with regard to the

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likelihood of success, that for five years, not three years, or three and a quarter years, but for five years, the mark simply was not used, it was out of business. It simply was gone, and it had been clearly abandoned. So, right off the bat we have three prongs. When we address the fourth prong, where the public interest lies, I believe the public interest lies with maintaining the status quo here and letting the parties fight out whether or not someone had a mark. Clearly, it is not the fodder for a TRO. Finally, with regard to a bond that would have to be filed in this case to cover the balance of hardship, so to speak, we are looking at something on the order of a tarp check that would be somewhere in the realm of what would be needed to cover the potential harm to Google, and the 46, 47 other defendants who make up probably 15 percent of American commerce. MR. MURPHY: Your Honor, of course I object to their categorizing my client's position or my client's idea or the argument of abandonment. I am at a disadvantage. I don't have anything in writing, no response or anything from them. So I can't really respond to statements he is making. THE COURT: I am looking at -- well, say they made an offer that two, three months down the road, you have a hearing

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on a full-scale preliminary injunction, which if you win, you could end up with a lot of money. I have some history with these cases. Do you remember the First Aid case? It was somewhat similar, as far as alleged abandonment of a mark and so forth. I certainly am not taking this as an open and shut case for either side. There is, however, the claim that there was abandonment, which is kind of fact intensive, and I would assume that you need some discovery. MR. MURPHY: Yes, sure. I mean, we may argue unclean hands, and other things. We can go back and forth with out positions as to what each side is doing. THE COURT: Why don't we do this: Why don't you meet and confer and come back in about two weeks and we will set some kind of a schedule then, you know, and if plaintiff is insistent upon a TRO, then I guess he is entitled to one, or to apply for one. MR. HARRIS: Thank you, your Honor. THE COURT: I am not ruling one way or the other. MR. MURPHY: I understand. MR. HARRIS: Yes. MR. MURPHY: This is obviously David and Goliath. THE COURT: Then we can get into discovery and -well, it seems to me that there are a lot of factual matters

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here. So, how does that sound, two weeks to meet and confer, and then suggest a procedure, discovery or -- or if you are bound and determined for a TRO, we will give it to you. MR. MURPHY: That sounds fine. MR. HARRIS: We can do that. Thank you, Judge. We appreciate it. MR. MURPHY: Yes. THE CLERK: May 21st at 9:00. THE COURT: We can't do it next week because I will not be here. MR. MURPHY: Thank you, your Honor. MR. FINN: And with respect to the motion to intervene -THE COURT: I will deny it because it is clearly out of order. MR. FINN: Thank you. MR. HARRIS: Thank you, Judge. We appreciate it. THE COURT: Did you keep that? MR. MURPHY: Yes, and we will make copies. THE COURT: All right. He is known to everybody, this person? MR. MURPHY: Yes, your Honor, he is. THE COURT: It is a rather folksy motion.

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MR. HARRIS: He is -- he is an interesting guy, let's put it that way. MR. MURPHY: Yes, yes. He has left a number of messages on my client's answering machine wanting to basically come in. THE COURT: Obviously he is not entitled to unless the plaintiff -MR. MURPHY: And certainly we don't want him in the case. He has no business in the case. THE COURT: Very good. MR. MURPHY: Or anywhere. MR. HARRIS: Thank you, your Honor. MR. FINN: Thank you. MR. DUNNING: Thank you. MR. CYRLUK: Thank you, your Honor. MR. MURPHY: Thank you. Do you want this or can I make copies of it? THE CLERK: You can keep that. I made a copy. MR. MURPHY: Thank you. (Proceedings concluded.)

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CERTIFICATE

I certify that the foregoing is a correct transcript from the record of proceedings in the above-entitled matter.

/s/Krista Burgeson, CSR, RMR, CRR Federal Official Court Reporter

May 7, 2009 Date