Polaris IP, LLC v. Google Inc. et al

Filing 252

SEALED MOTION to Compel Yahoo! Inc. to Comply with Court Order of November 5, 2009 and Produce Source Code in Native Format as Maintained in Ordinary Course of Business by Bright Response LLC. (Attachments: # 1 Affidavit, # 2 Exhibit A, # 3 Exhibit B, # 4 Exhibit C, # 5 Exhibit D, # 6 Exhibit E, # 7 Exhibit F, # 8 Exhibit G, # 9 Exhibit H, # 10 Exhibit I, # 11 Exhibit J, # 12 Exhibit K, # 13 Exhibit L, # 14 Exhibit M, # 15 Exhibit N, # 16 Exhibit O, # 17 Exhibit P, # 18 Text of Proposed Order)(Wiley, Elizabeth)

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1 2 3 4 V. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES: IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF TEXAS MARSHALL DIVISION BRIGHT RESPONSE, LLC Civil Docket No. 2:07-CV-371-CE GOOGLE, INC., ET AL Marshall, Texas November 23, 2009 9:30 a.m. TRANSCRIPT OF MOTIONS HEARING BEFORE THE HONORABLE CHAD EVERINGHAM UNITED STATES MAGISTRATE JUDGE FOR THE PLAINTIFF: MR. ANDREW SPANGLER Spangler Law PC 208 N. Green St. Suite 300 Longview, TX 75601 MR. JASON C. WHITE Howrey LLP - Chicago 321 North Clark St. Suite 3400 Chicago, IL 60610 FOR THE DEFENDANTS: APPEARANCES CONTINUED ON NEXT PAGE: COURT REPORTER/TRANSCRIBER: MS. SUSAN SIMMONS, CSR Official Court Reporter 100 East Houston, Suite 125 Marshall, Texas 75670 903/935-3868 (Proceedings recorded by digital recording, transcript produced on CAT system.) -21 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES CONTINUED: FOR THE DEFENDANTS: MR. JOSHUA REED THANE MR. JOHN SCOTT ANDREWS Haltom and Doan 6500 Summerhill Road Suite 100 P.O. Box 6227 Texarkana, TX 75505 MR. JOHN FREDERICK BUFE Potter Minton P.O. Box 359 Tyler, TX 75710 -31 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 and Doan. PROCEEDINGS COURT SECURITY OFFICER: THE COURT: All right. versus Google and others. the protective order. What says the Plaintiff? MR. SPANGLER: Your Honor, Andrew Spangler on Be seated. Case 2:07-CV-371, Bright Response Got a hearing on a motion to modify All rise. behalf of the Plaintiff, ready to proceed. THE COURT: MR. THANE: For the Defendant? Your Honor, Josh Thane with Haltom Mr. Scott Andrews with Haltom and Doan, Jason White of Howrey, and Mr. John Bufe of Potter Minton, ready to proceed. THE COURT: ahead and proceed. MR. WHITE: Good morning, Your Honor. Jason All right. It's your motion. Go White from Howrey on behalf of Defendant Yahoo!. THE COURT: MR. WHITE: the protective order. Yes, sir. We're here on our motion to modify I want to start with a little bit of background and trace how we got to where we are today. The protective order was something that Yahoo! did agree to many, many months ago, maybe even years at this point. The protective order does require that Yahoo! provide -41 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 a printer that gives the Plaintiff access to print -- actually create a physical print -- printed documents while it's reviewing the source code. The current version of the protective order requires that the Plaintiff then turn those over to us so that Yahoo! has a chance to review the requested print files to see whether it's proper to have them, label them, get them produced back to the Plaintiff. THE COURT: Since we -- Well, let me ask you -- I -- and I -- sometimes I don't think of questions at -- at the time when you're through speaking -MR. WHITE: THE COURT: and not interrupt you. With respect to the current terms of the protective order, have those proven unworkable for some reason? MR. WHITE: They are of extreme concern to And the Sure. -- so I -- I'll try to be mindful Yahoo!, the current terms of the protective order. simple answer -- that is, we cannot figure out a way to provide a printer on a laptop that does not allow or create a security risk that that same port the printer's connected to could be used to take the source code off the comput -- off the computer. THE COURT: MR. WHITE: Okay. I've asked their technical folks, -51 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 correct. THE COURT: Well, how have the terms of this is there any way that they could restrict the use of that port to just printing, and we've not come up with a technical solution to solve that. THE COURT: That -- that concern was there at the time the stipulation was entered though, correct? MR. WHITE: THE COURT: MR. WHITE: Yes and no. Science has not changed, has it? The science has not changed, stipulation become unworkable since the time you entered into it? MR. WHITE: Sure. So from the -- from Yahoo!'s perspective there's a different in-house team that I'm dealing with and also a different corporate policy. At the time that they entered into this agreement, they had entered into other protective orders that allowed printers to be used in the manner that this current protective order allows for. They experienced some security issues in other cases, not this case, but other cases where people were doing things surreptitiously to the code in the computers and that caused Yahoo! to sort of take an overall look at the policy and review it. And that's -- the policy changed earlier this year where they adopted a policy that if we're sending out a code -- computer with code on it for review, we will not have -61 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 anybody. locations. any open ports or any active ports on it so that people cannot get access to the code. And it's not the experts, per se. This thing is in transit. It's It's stored at different We can't possibly have eyeballs on it 24 hours a So that's the answer to day when it's out of our possession. your question is what has caused them to revisit or believe that these terms are unworkable. It's things that we've seen in other situations that have asked us to modify this protective order. THE COURT: MR. WHITE: Okay. Sure. Go ahead. And -- and just so we're clear is -- we're just trying to protect the code which is Yahoo!'s most valuable asset. We're only talking about a very slight modification that controls who actually generates the physical printout. We're not talking about which code they We've given get, who gets to see it, when they get to see it. them printouts. I think that they'll admit that they're getting those timely from us under -- with the printer or when they didn't have the printer. additional codes. code. We've responded to requests for We're trying to give them access to the It's not a situation where we're trying to restrict It's only a situation where we're their access to the code. trying to limit our risk and vulnerability by having that source code exposed for possible viewing, stealing, whatever -71 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 you want to call it, by any number of third parties. really is just a security concern at this point. With respect to whether we think it prejudices the Plaintiff, we don't believe it does. We've provided a So it number of work arounds for them, short of them actually having the physical printer there. One of the ones that we've offered recently is a print to file option so as they're -- one of the main reasons that they raise in their briefs as a -- something that they think was prejudicial was they said it was cumbersome for their expert to write down file names that they want printouts of, send them to us in a letter or where -- whatnot, and then have us get those files and send them back to them. We've added a print to file option which allows their expert as she's looking at the code to actually print that code to a file so an electronic basically -- storage location is created with all the files that she wants copies of. We will then go in, find those files on our own, we being Yahoo!, get the printouts generated, then get them sent to them so that they don't have to do any transposition or writing down of files names or anything like that. So in terms of prejudice and speed and getting the -- and getting them the printouts, we think that those solutions that we've offered will do that for them with absolutely no prejudice to them, both in terms of what they -81 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 get, how long it takes it to get to them, and what efforts they have to make to -- to relay the requests to us. And it's for those reasons that we'd ask for this just slight modification to the protective order to allow us to generate the print -- the physical files, gives us the security we need, the protection while not prejudicing the Plaintiff. THE COURT: Is Yahoo! currently in compliance with the terms of the protective order? MR. WHITE: THE COURT: We are, Your Honor. When did you bring yourself in compliance with the terms of the protective order? MR. WHITE: the most recent review. THE COURT: And how many days was their expert Friday morning before they started there before Yahoo! brought self into compliance with the terms of the protective order? MR. WHITE: Spangler to confirm. I believe it was two. I'll ask Mr. I think that she was there reviewing code on Wednesday and Thursday, and then we got somebody -- I think flew out from California when we got your order that came out -- the minute order with the hardware or the software necessary, trying to reconfigure the printer and get a printer up and running by 9:00 a.m. on Friday. THE COURT: Well, that was -- just for purposes -91 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 that record, that would have been the third time you had been provided with my suggestions as to how to comply with the order. MR. WHITE: THE COURT: I understand. Once in the order itself that you agreed to, a second time before this happened in open court, and then finally while I was traveling yet a third time, correct? MR. WHITE: THE COURT: I understand that, yes. Okay. Okay. Thank you. MR. SPANGLER: Your Honor, I'd like to address each point if I could, possibly in the reversal of the questions that the Court asked. First, the number of days my consultant has been there, I can assure the Court it's been well more than two days. Probably seven to eight days of full time, over a We got the source code for the first span of a few weeks. time in October, so obviously it wasn't months and months. There's no question that we agree with Yahoo! that it's a valuable asset. and a half ago. It was a valuable asset a year As counsel in over Its value hasn't changed. fifty cases of its source code provisions, never once been part of a case where we've had a violation and produced source code. those. And we have print capabilities in nearly every one of - 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 To the Court's question of whether it's workable, it is workable because we do it with Google. Google prints the source code, we get it, we give it to them, they give it back. The difference between the print to file and the way we're doing it now, if it works correctly, we'll agree with Yahoo! that there is not much difference in terms of time, however, for example, we've tried the print to file feature once and our consultant used it, and then the files disappeared and she had to start over. Whereas, if she prints as she goes, that chance of potential mistake doesn't exist. The capacity issue, we've had some problems with the printer. Mr. White has taken care of that. They're working on getting the printer up and working, but we've had one day out of a year and a half since this agreement where our consultant has been able to go in, review the code in compliance with the protective order. And the disputes over the protective order were over a year and a half ago, and they weren't just written down and agreed to, there were actually some disputes surrounding the source code and where was it going to be produced and how and I argued that hearing. Plaintiff's position. And Mr. White didn't dispute the Judge Folsom ruled, and it Google did. impacted both this case and the PA Advisors case. And part of this also deals with promptness, to be honest with the Court. If this had been raised months and - 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 months ago, a year ago when the source code should have been produced and the parties had had time to maybe work it out, it's possible we might be in a slightly different position, but deadlines are fast approaching, we're just now getting to it. We agreed to that procedure a year and a half ago because we believed at that time it was the most efficient way to handle this. The only thing that has changed in the last year and a half is, one, last month, we finally got the code. And, two, Yahoo! has new lawyers, new in-house counsel. That's it. That's the only change. They have a new policy that runs counter to this Court's order, but they never sought relief until now. Your Honor, other than that, I don't have any other information for you. THE COURT: Well, tell me what strenuous objections you have to the proposed modification, other than its timeliness. MR. SPANGLER: The big issue is the possibility They -- and it's already been shown once -- of mistake. already are having technical glitches on how fast the printer is working, on -- we've lost all the print to file stuff that's happened once. And for printing as we're going, as a consultant sees it, when she reviews it, she finds something relevant, she prints it right then, the mistakes don't happen. - 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 There's no possibility of wasted time, effort, and money. That is the biggest prejudice. There's no chance of mistake. And with the deadlines, we believe that's appropriate. THE COURT: Well, that's a timeliness issue. That is correct, Your Honor. MR. SPANGLER: THE COURT: The source code review issues arise a lot though, and they're -- what you're suggesting to me is if they're -- if they arise early in the review, then the parties can usually resolve them and then on a going forward basis, there's not much problem then, correct? MR. SPANGLER: If this had been raised a lot earlier, it is possible the Plaintiff would be standing -would not be standing here. Court, that is correct. To be completely candid with the I won't say a It is possible. hundred percent because like I said, this procedure has worked just fine with Google. It works in a lot of my other cases, but, yes, timeliness of when it was produced obviously has an impact on the position today. THE COURT: MR SPANGLER: Okay. And the last thing, Your Honor, I told the if I could raise, deals with the last hearing. Court there was a stipulation with Google already in place when the historical production was raised and that we didn't have the multiple versions in the past. not yet been entered into. That stipulation had And in fact, I believe the parties - 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 are still fighting over it between Google and the Plaintiff. Just wanted to clarify that for the Court. THE COURT: Well, with respect to Google and the Plaintiff or with respect -MR. SPANGLER: THE COURT: Right. -- to Yahoo!? Yahoo! and the Plaintiff have MR. SPANGLER: worked it out, but I told the Court that Google had finalized it. They have not yet done so. THE COURT: MR. WHITE: Okay. Any reply? Very briefly, Your Honor. And this is Jason White from Howrey again on behalf of Yahoo!. With respect to the issue he raised about a chance of a mistake, Yahoo! has offered to provide one of its technicians on site at the code review to assist their technical expert, to explain any issues that she's got. really do have concerns, security -- legitimate security concerns about their code and they're willing to do things that are even more expensive to them, like provide a technician on site to assist the Plaintiff so we can assure that there won't be any technical glitches going forward. I think that's the only thing we can do beyond what we've already done in this case, but they are willing to take any measures necessary. They feel so strongly about the security And They - 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 denied. questions. MR. WHITE: THE COURT: Thank you, Your Honor. All right. The motion to modify is of the code, that if it requires it, they're happy to provide a technician on site to answer any questions, deal with any technical glitches -- glitches that could arise, as well as provide daily printouts of the source code to the expert on site so she can have them just as she would if she were printing them. It's just purely an issue of who actually presses print and generates the actual physical copy. With respect to the timing of the request for relief, as soon as the issues came to my attention, we moved the Court both in nXn and in Bright Response. As Your Honor will recall, and in the briefs this issue did come up earlier and I thought we had worked out an arrangement with the Plaintiff's prior counsel. Once it became clear that Plaintiff's new counsel was not going to agree to that, we moved the Court immediately to have the modification in place. So just as soon as it did come to my attention, we did ask Your Honor for relief. And that -- that's all that I've got unless you have additional questions for me, Your Honor. THE COURT: I don't have any additional For purposes of the record, I'm finding that Yahoo! has not shown good cause for the proposed modification. - 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 * Counsel, I don't doubt that -- that Yahoo!'s entitled to change its corporate policies as it sees fit, but there's a signed order of Court in place and -- and I'm not inclined to allow a party through its adoption of a new corporate policy to create a de facto modification of the terms of the Court order. And if there had been a showing in this case that the terms of the protective order were unworkable because of some event that had happened in this case, such as a security breach, then I'd be inclined to adopt your argument, but this record is plain that the only party to this litigation that has not been in compliance with the terms of the protective order is your client, Yahoo!. And so in light of that there's been no good cause shown to make the modification as requested, and I'm denying it. We're in recess. COURT SECURITY OFFICER: All rise. (Hearing adjourned.) * * * * - 16 1 2 3 4 I HEREBY CERTIFY that the foregoing is a CERTIFICATION 5 correct transcript from the digital recording of the 6 proceedings in the above-entitled matter to the best of my 7 ability. 8 9 10 11 /S/ Susan Simmons_______________ SUSAN SIMMONS, CSR 12 Official Court Reporter State of Texas No.: 267 13 Expiration date: 12/31/10 14 15 16 17 18 19 20 21 22 23 24 25 1/12/10_______________ DATE

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