Red Bend Software, Inc. et al v. Google

Filing 26

Transcript of Scheduling Conference held on December 2, 2009, before Judge Woodlock. Court Reporter: Debra M. Joyce at [e-mail]. The Transcript may be purchased through the Court Reporter, viewed at the public terminal, or viewed through PACER after it is released. Redaction Request due 12/24/2009. Redacted Transcript Deadline set for 1/4/2010. Release of Transcript Restriction set for 3/3/2010. (Scalfani, Deborah)

R e d Bend Software, Inc. et al v. Google

Doc. 2

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V. GOOGLE, INC.

UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS
_ _ __ _ _ _ __ _ _ _ __ _ _ __ _ _ _ __ _ _ _ _ R E D B E N D S O F T W A R E, I N C. ,

Plaintiff,

Civil Action No. 0 9 - 1 1 8 1 3 - D P W
December 2, 2009, 1 0 : 55 a .m .

Defendant. ___________________________

TRANSCRIPT OF SCHEDULING CONFERENCE B E F O R E T H E H O N O R A B L E D O U G L A S P. W O O D L O C K UNITED STATES DISTRICT COURT J O H N J. M O A K L E Y U . S . C O U R T H O U S E 1 COURTHOUSE WAY B O S T O N , MA 02210

DEBRA M. JOYCE, RMR, CRR Official Court Reporter J o h n J. M o a k l e y U . S . C o u r t h o u s e 1 Courthouse Way, Room 5204 B o s t o n , MA 0 2 2 1 0 617 - 7 3 7- 4 4 1 0

Dockets.Justia.c

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APPEARANCES:

F O R T H E P L A I N T I F F:

DANIEL J. CLOHERTY, ESQ. Dwyer & Collora LLP 600 Atlantic Avenue 12th Floor Boston, MA 02210 617-371-1000 ROBERT C. SCHEINFELD, ESQ. Baker Botts LLP 30 Rockefeller Plaza 44th Floor New York, NY 10012-4498 212-408-2512
F O R T H E D E F E N D A N T:

SUSAN BAKER MANNING, ESQ. Bingham McCutchen LLP - DC 2020 K Street, NW Washington, DC 20006-1806 202-373-6000 SABIN P. WILLET, ESQ. Bingham McCutchen LLP - MA One Federal Street Boston, MA 02110-1726 617-951-8000

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PROCEEDINGS (The following proceedings were held in open court before the Honorable Douglas P. Woodlock, United States District Judge, United States District Court, District of Massachusetts, at the John J. Moakley United States Courthouse, 1 Courthouse Way, Boston, Massachusetts, on December 2, 2009.) THE CLERK: The court is now on the record in matter

of Red Bend Software, Inc. v. Google, Inc., civil action 09-11813. Will counsel please identify themselves for the record. MR. CLOHERTY: Good afternoon, your Honor. Daniel

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Cloherty here on behalf of the plaintiffs.

With me is Rob

Scheinfeld from Baker Botts, New York, also for the plaintiffs. MR. SCHEINFELD: MR. WILLETT: Good morning, your Honor. Sabin Willett And I'd

Good morning, your Honor.

of Bingham McCutchen for the defendant Google, Inc. like to introduce my partner Susan Baker Manning.

I think you have allowed her pro hac vice motion. MS. BAKER MANNING: THE COURT: Good morning, your Honor.

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If you tell me I have, I have. You have indeed, sir. Let me just go back to this. One thing I thought about

MS. BAKER MANNING: THE COURT:

All right.

The whole question of scheduling.

doing but I think I probably can't properly do it is to merge

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the preliminary injunction with a trial of the merits.

And I

guess my quick reading of the complaint suggests to me that I can't do that for Dairy Queen kinds of reasons that some of the fact-finding is going to be -- have to be jury finding, has to be preliminarily jury finding. So then I back up a little bit and say, you know, what's a reasonable schedule for getting this teed up for preliminary injunction? Having in mind you people are very

fast, I'm slow in my capacity to absorb this stuff. And I guess I don't really understand why, from Red Bend's point of view, the Google proposal isn't an approximation of the square-law response? Apart from the fact

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that it's not yours, what's the problem with it? MR. SCHEINFELD: Well, because every day that passes,

your Honor, our client is being irreparably harmed. THE COURT: As I get older, I have that feeling of You know, so we're

every day passing being more meaningful.

all going to have to worry about timing and all of that, but I'd like the parties to have a fair opportunity to get the preliminary injunction kind of done without killing themselves and me in the Christmas season. MR. SCHEINFELD: And that's fair, your Honor. I just

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have a few points to make, if I may. THE COURT: Sure. The first has to do with delay.

MR. SCHEINFELD:

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Google has known about this since early September. hired a fairly large firm, I'm sure they could -THE COURT: Baker Botts is a boutique?

They have

MR. SCHEINFELD:

No, but the point is that Google is

not prejudiced by having an expedited hearing, an earlier hearing. THE COURT: you. But this is expedited, too, I have to tell

The kind of general Google response seems to me to be --

you know, it's moving along in a pretty good clip. MR. SCHEINFELD: May I then, your Honor, turn to the

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irreparable harm, which I think is the most important reason to have the hearing fairly quickly. THE COURT: All right. If I may pass up, your Honor, a

MR. SCHEINFELD:

document I'd like to discuss with you. THE COURT: (Pause.) MR. SCHEINFELD: So, your Honor, this a document that Sure.

we just retrieved, it's a blog from Google's website. As we speak, there's dialogue going back and forth by users of the infringing code, and there's confusion by those users. You'll see that the highlighted entry -- you'll see

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that at the bottom of the first page somebody is saying, Be careful about the use of this code because a lawsuit has been filed.

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Then, on the following page, someone is saying, Well, you know, Courgette is open source. will happen. And so I doubt anything Many people have

So I say don't worry about it.

been using this library. you to use it.

And the Chromium license will allow

So there's this give and take.

There's this confusion

in the -- and we're very concerned about -THE COURT: Yes, on the other hand -- not to be too

harsh about it, but participants in internet blogs tend to assume that everything is open source. And they're slow to I'm not

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understand kind of property law limitations on that.

sure that I'm going to be guided by the fact that there are out there bloggers or commenters who are, perhaps or perhaps not, misapprehending what the -- what's going on. I'm really talking about what's the fair way of dealing with this? irreparable harm. Let me turn -- because I'm dealing with Isn't there a way to monetize that, the Let's assume you prevail.

irreparable harm that you have? MR. SCHEINFELD:

I don't believe there's a way to

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monetize that, your Honor, because you're talking about our reputation, our credibility. THE COURT: Let's assume that you prevail on the

preliminary injunction, in which case you get to, perhaps, create your own blog that talks about how Google is pirating this kind of thing.

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I mean, you know, the question of thrust with parry on the internet in a difference of a month or so, a little more, seems to me to be, as the law goes anyway, not that important. With respect to monetization, you've still got jury claims in here. damages. Those jury claims presumably are looking for

At some point I won't turn to you and say, But you

said how could anyone calculate damages here, your Honor? Because I suspect at some point, if you prevail, you're going to be telling me how they can be calculated. So when I talk about irreparable harm, something that simply can't be dealt with in any other way, doesn't seem to present itself here. MR. SCHEINFELD: Well, in the blog -- and I agree that

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there's only so much we can -- so much credibility we can give to a blogger -- but there is an indication that there are many users out there, and so we're talking about an unquantifiable number of users who are using the code and infringing as we speak. THE COURT: You may be able to develop that, you will

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develop it for, I'm sure, for damages, if it comes to that. The short of it is I don't see this as more than, you know, we'll get to it as promptly as we can, the question is how promptly should that be? And I'm back to the idea, apart from

saying that every day is a new day of their new infringement, why I shouldn't say, Look it, let's do it in a more orderly

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fashion? MR. SCHEINFELD: I'm not -- your Honor, I could

understand doing it in a more orderly fashion, but Google's proposal is just further along the lines of their strategy to delay. Why wait until February? Why can't we have the That's what --

preliminary injunction hearing in mid-January? THE COURT:

Because I have real questions -- without

knowing very much about this, I have some real questions about the ability of the parties fully to develop their cases in a fashion that will be helpful to me. I have a concern about the I'm just I

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ability of the parties to fully develop their cases.

probing to see if there's something here that I'm missing. haven't heard anything yet. MR. SCHEINFELD:

Well, in terms of irreparable harm, And

again, we're competing, we're losing customers to Google. there's a threat of price erosion.

If our customers find out,

and they have, that Google's offering as open source free to everybody infringing code, why would anyone come to us? You

know, why would anyone pay us a license for the code that we're -THE COURT: Okay. So you get your preliminary

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injunction at the end of that, and now you've got people who can't be weaned away from your code, in which case you can charge whatever you charge. MR. SCHEINFELD: That's fair. But, you know, we're

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talking about the taint that perhaps would apply to Red Bend during this period of time where Google is using its muscle and marketing muscle to advertise to the world that its code is open. THE COURT: Okay. So, you know, if David has to wait

a bit to bring down Goliath, I'm not sure that's material here. So I think I understand what your concerns are, and they're reasonable concerns, I'm just not persuaded that it justifies what I might call distorting the schedule a bit, including the schedule for me to be able to absorb these materials. MR. SCHEINFELD: THE COURT: Well, your Honor, I've tried my best. And you can report to your client

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Okay.

that you did, that you faced an obdurate and unreasonable judge. (Discussion off the record.) THE COURT: So if we set this -- I'm going to set it

and then work my way back for hearing on the afternoon, let's say, 2:30 on Wednesday, February 17th. Do the parties

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realistically think they're going to have live testimony here or want to have live testimony? MR. SCHEINFELD: THE COURT: Yes, your Honor.

Like what? We would propose at this point in

MR. SCHEINFELD:

time hearing from two of our witnesses, our principal and our

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expert. THE COURT: What are they going to talk about? Well, harm, our principal is going to

MR. SCHEINFELD: talk -THE COURT:

Let me tell you -- why is it that I can't

just take your -- take their depositions -- take their affidavits on this? I always like to make new friends, but I'm

not sure that I need to meet them here. MR. SCHEINFELD: Well, your Honor could take their

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declarations, but then we would want the opportunity to cross. THE COURT: Let's see what I think about that. Do you

want to press your luck by telling me -MR. SCHEINFELD: You're doing so well. Well, I will tell you, your Honor,

MS. BAKER MANNING:

certainly if Red Bend intends to present their witnesses live, I think it would make sense to have live witnesses as well. THE COURT: My default on this at this point is

declarations or affidavits from the witnesses that you intend to introduce here. MS. BAKER MANNING: And would cross be introduced

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through deposition testimony, your Honor? THE COURT: I don't know what cross would be necessary

And what I think I would say is in the argument on the

17th, I'll hear you on the question of whether or not you think it is necessary to have cross-examination. And then I'll

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schedule time if I think it's appropriate.

But we're dealing

with a preliminary injunction here, and I'm not sure that -because it's not going to be resolved in a final form at this stage that I think that live testimony is going to be that helpful, but I certainly don't know enough about it, that a kind of desire of your clients to speak in open court is not enough for me, and the chance to practice cross-examination skills is not enough for me either. So it's got to be something that tells me it's going to be material to my disposition of the matter that couldn't fairly have been anticipated by the parties here. I view live testimony generally as important for purposes of dealing with witnesses' credibility, and I'm not sure credibility is going to be that much of an issue here. Maybe it will, I don't know. Won't be the first time I'm

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surprised, but the time at which I'll make a determination about that I think is going to be at the hearing on this. So what I'm carving out is, as I said, 2:30 on February 17th. That then, I think, works us back here, just using the time frame that Google has in its, I think, reply, so Google -let's see -MS. BAKER MANNING: We had proposed, your Honor,

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anticipating a hearing the week of the February 15th, which is where we are. We had suggested we file an opposition on

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January 29th, which I believe is a Friday. THE COURT: Okay. So January 29th for the opposition.

Here the parties' depositions' schedule and production of document schedule I don't understand -- apart from wanting to expedite it more on the part of Red Bend, I don't see that as a problem. Is it? MR. SCHEINFELD: No, it's not, your Honor. But if I

may address the time of Google's opposition.

If that's the

case, your Honor, we would only have six days to file a reply, and we would -- I would like more time to do that. suggesting that we push back the hearing. I'm not

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What I'd like to

have is Google's opposition due a week or two earlier than January 29th to give Red Bend time to reply, more time to reply. THE COURT: So what you had the last time under your

proposal is nine days? MR. SCHEINFELD: THE COURT: That's correct, your Honor. The 25th, January 25th for Google's But in

Okay.

opposition to the motion for preliminary injunction.

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terms of the document production and that sort of thing, the development of time periods, do I have to impose one or do you think you can work it out without coming back to me? MR. SCHEINFELD: out. MS. BAKER MANNING: There is one issue I would like to I think we'll be able to work that

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address.

There is -- we have asked for the production of

documents that would support or tend to refute the allegations, the factual allegations made in the PI motion. The response we

got was that they were willing to do so but in return they wanted all documents re: Courgette, which is the name of the allegedly infringing product. They wanted all documents about

themselves, which would be, I take it, from any division of Google, not just the division where this product resides. The

allegedly infringing algorithm is used to update the Chrome web browser, it's not used for anything else. So to the extent

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that division might have anything about Red Bend, I can see why that might be relevant at a later point once discovery is open. But I don't think there's any call for us to be producing documents to Red Bend at the outset of the case -- they've already filed their preliminary injunction motion. It doesn't

seem to make any sense why they get additional discovery while we're preparing an opposition to further support the motion that they've already filed, and presumably have -- at least they feel that they have adequately supported. THE COURT: Why not? I don't see that at all.

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I guess my view generally is, you know, you're constrained by the time period. I'm not interested in the

kinds of burdensome discovery that sometimes is imposed, but, you know, I'm not sure that I think that without knowing how Google organizes its documents or divisions or subsets that

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just limiting it to Chromium is necessarily successful. Now, but I don't want to have people spending a lot of time on, you know, electronic discovery and that kind of stuff. So what I want is just common sense about it. MR. SCHEINFELD: THE COURT: Well, your Honor -I suspect that you That's all.

It's not proscribed.

should be able to find pretty quickly at the division and above level the degree to which there were some discussions relevant to this case and the issues in this case by persons at Google who may not be resident in the Chromium division. putting a constraint on it. On the other hand, nobody is going to spend the rest of their life or until January 25th looking for documents hither and yon that may incidentally reference Red Bend. if there's anybody who has a search engine -MS. BAKER MANNING: THE COURT: Okay. If I could address that point, your Yes, sir. But So I'm not

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MR. SCHEINFELD: Honor.

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I think there are other divisions in Google that not only will have documents about Red Bend, but we have reason to believe that they knew about it -THE COURT: Then tell them about -- apart from telling

MR. SCHEINFELD:

Android.

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THE COURT:

-- why it is you want them and be I do think the time frame

reasonable in your request here.

kind of correctly constrains the parties, and, you know, kind of wholesale discovery. You know, I'm not imposing a restraint

on just the Chromium division; on the other hand, it has to be pretty pertinent to the issues. MR. SCHEINFELD: If I may address that, your Honor, I Our Red Bend principals or Red It was another division,

think it's fairly important.

Bend people met with Google in 2008. but we have reason to believe that -THE COURT: Okay.

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So you'll tell them where it is But

that you think things would be found that are important.

they aren't going to be required to search every division of Google to find this information, unless there's some reason to believe that it might be resident. MR. SCHEINFELD: fine. If I may also address a time in which Red Bend will have to submit its reply. have January 25th -THE COURT: February 5th, because I took your schedule I didn't get a date, your Honor. I Thank you, your Honor, that will be

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and backed it up to give them -- to give you nine days to respond, or reply to their opposition. Now -- so back to the discovery schedule. I mean, if

you want -- if I should, I will impose some time frame for it.

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I don't want to do that, because you're going to, I suspect, be doing discovery right up to January 24th. MR. SCHEINFELD: I think -Hopefully not quite that late. I would

MS. BAKER MANNING: MR. SCHEINFELD:

I hope we can work it out.

propose we have a date we mutually exchange documents that we each believe are relevant to the issues. THE COURT: before then. Okay. December 22nd, if it's not done

My view is that it should be being done now, but

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that's the final date for the production of documents. MS. BAKER MANNING: out what's relevant. I will tell you we'll have to work

We believe quite strongly that the

Android -- the Android products are not accused in this case, they have nothing to do in this case, according to the allegations that have been made. I have very serious concerns

about fishing through Android and dramatically increasing -THE COURT: Okay. If you want to come back, this has I don't think coming back will

been a pleasant conversation.

be so pleasant if I sense that anybody is being unreasonable about this. Did they negotiate with Android? MS. BAKER MANNING: Android -THE COURT: Okay. So let me just tell you something. There have been discussions with

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My view is that's likely to be relevant, and they're likely to

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get that information.

So if this is a backdoor way of saying

that, when I rather gently suggested that it's not limited to the Chromium division, you're trying to limit it to the Chromium division, don't try it. MS. BAKER MANNING: THE COURT: Okay?

Appreciate it, your Honor. So we've got, I think, some

All right.

general understanding that we'll work out the details with a view toward getting everything done by way of discovery by no later than the filing of an opposition by Google, which is January 25th. And that the documents will be produced finally

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by December 22nd, but I expect rolling document production here by the parties rather than just a dump on December 22nd. So I think that deals with the preliminary injunction. Now, I've got this motion to dismiss that's been filed. What's the theory of indirect infringement? bloggers? Is that what it is? MR. SCHEINFELD: Well, it's the indirect infringement, Is it the

it's Google's inducement of others to infringe directly and contributorily as well. THE COURT: Okay. So who is that, the bloggers or

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people who use Chromium? MR. SCHEINFELD: Developers, not just bloggers, it's

the developers, people who are developing their own code for other uses outside Chrome.

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THE COURT:

What do you know about that? Well, we have evidence that there are

MR. SCHEINFELD:

people who are using, using the -THE COURT: What do you have about developers? Well, your Honor, I have no evidence,

MR. SCHEINFELD:

as I sit here today, that a developer is generating Courgette source code. But that's the whole purpose of open source.

They're telling the community that go ahead and use this, you know, use this, it's open to you to use. THE COURT: Well, there is, from my perspective, not a

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little bit of an issue with respect to the motion to dismiss here as to those that you cannot at this point provide me with a plausible identification. When I say "identification," I I mean

don't mean developers or the development community.

PhistucK, P-h-i-s-t-u-K, capital K at the end, being one of them who is a blogger who seems, you know, sensitive to your concerns. MR. SCHEINFELD: who are -THE COURT: Okay. But the short of it is, this isn't Right. And there are other bloggers

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going to be the occasion -- I'm not suggesting limited discovery, but this is not the occasion to fish for developers who are using it. The core of this case is not, it strikes me,

how they're making it available to -- through open source, but a more meaningful identification of their actions that

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constitute infringement. MR. SCHEINFELD: THE COURT: Of Google's actions.

Right. Certainly Google using Courgette

MR. SCHEINFELD:

itself is directly infringing. THE COURT: looking at. That's what we're really going to be

I wouldn't spend a lot of time or do a lot of

fishing here on this, and I will look at the motion to dismiss, but I will afford you an opportunity to amend your complaint after we have the preliminary injunction hearing. MR. SCHEINFELD: Your Honor, I was going to offer --

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to avoid motion practice, I was going to offer, even though we don't agree with Google's motion, that we will amend the complaint. THE COURT: Okay. So when?

MR. SCHEINFELD:

We could amend it, as your Honor

suggested, it could be after the preliminary injunction hearing. THE COURT: Well, I don't -We could do it whenever your Honor

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MR. SCHEINFELD:

THE COURT:

I'm sure you can, but the question is I don't want the motion practice

what's a good time to do it? either.

The focus of this preliminary injunction is going to

be on direct infringement, as far as I can see, and spiced up

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with demonstrations of how it's clear that they've directly infringed through facilitating activities by others who might be engaged in indirect infringement. But we'll kind of see

what's standing or what's left after the preliminary injunction hearing. So I'm denying the motion to dismiss without prejudice to it being reasserted after the preliminary injunction hearing. MR. SCHEINFELD: THE COURT: talk about? MR. SCHEINFELD: THE COURT: the 17th. MR. SCHEINFELD: THE COURT: Thank you very much. Not from Red Bend, your Honor. All right. So I will see you on Thank you, your Honor. Now, anything else that we need to

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Okay.

Okay.

Thank you.

(Court adjourned at 11:25 p.m.) -----------CERTIFICATION I certify that the foregoing is a correct transcript of the record of proceedings in the above-entitled matter to the best of my skill and ability.

/s/Debra M. Joyce Debra M. Joyce, RMR, CRR Official Court Reporter

December 3, 2009 Date