GENBAND US LLC v. Metaswitch Networks Corp. et al

Filing 431

ORDER granting in part and denying in part 261 , 262 , 266 Motions to Strike. Signed by Magistrate Judge Roy S. Payne on 01/09/2016. (rsp2, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION
GENBAND US LLC
v.
METASWITCH NETWORKS CORP., ET
AL.

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Case No. 2:14-cv-33-JRG-RSP

ORDER ON MOTIONS TO STRIKE
Before the Court is a Motion to Strike Opinions of Dr. Eric W. Burger on Invalidity filed
by Plaintiff Genband US LLC (“Genband”). (Dkt. No. 261). Also before the Court are
Genband’s Motion to Strike Certain Opinions of Dr. Tim A. Williams (Dkt. No. 262), and
Genband’s Motion to Exclude Certain Opinions of Metaswitch’s Damages Expert Matthew R.
Lynde. (Dkt. No. 266).
I. LAW
Rule 702 provides that an expert witness may offer opinion testimony if (a) the expert’s
scientific, technical, or other specialized knowledge will help the trier of fact to understand the
evidence or to determine a fact in issue; (b) the testimony is based on sufficient facts or data; (c)
the testimony is the product of reliable principles and methods; and (d) the expert has reliably
applied the principles and methods to the facts of the case. Fed. R. Evid. 702.
“The inquiry envisioned by Rule 702 is . . . a flexible one,” but, in Daubert, the Supreme
Court held that the Rules also “assign to the trial judge the task of ensuring that an expert’s
testimony both rests on a reliable foundation and is relevant to the task at hand.” Daubert v.
Merrell Dow Pharms. Inc., 509 U.S. 579, 594, 597 (1993); see also Apple Inc. v. Motorola, Inc.,
757 F.3d 1286, 1321 (Fed. Cir. 2014) (“Experts routinely rely upon other experts hired by the
party they represent for expertise outside of their field.”); TQP Dev. LLC v. 1-800-Flowers.com,
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Inc., Case No. 2:11-cv-248-JRG, 2015 WL 6694116, at *4 (E.D. Tex. Nov. 3, 2015) (“Dr.
Becker was entitled to rely upon Dr. Jager’s technical analysis when constructing his damages
model and presenting it to the jury.”).
“The relevance prong [of Daubert] requires the proponent [of the expert testimony] to
demonstrate that the expert’s ‘reasoning or methodology can be properly applied to the facts in
issue.’” Johnson v. Arkema, Inc., 685 F.3d 452, 459 (5th Cir. 2012) (quoting Curtis v. M & S
Petroleum, Inc., 174 F.3d 661, 668 (5th Cir. 1999)). “The reliability prong [of Daubert]
mandates that expert opinion ‘be grounded in the methods and procedures of science and . . . be
more than unsupported speculation or subjective belief.’” Johnson, 685 F.3d at 459 (quoting
Curtis, 174 F.3d at 668).
In assessing the “reliability” of an expert’s opinion, the trial court may consider a list of
factors including: “whether a theory or technique . . . can be (and has been) tested,” “whether the
theory or technique has been subjected to peer review and publication,” “the known or potential
rate of error,” “the existence and maintenance of standards,” and “general acceptance” of a
theory in the “relevant scientific community.” Daubert, 509 U.S. at 593–94; see also Kumho Tire
Co., Ltd. v. Carmichael, 526 U.S. 137, 150 (1999) (“Daubert makes clear that the factors it
mentions do not constitute a ‘definitive checklist or test.’”); U.S. v. Valencia, 600 F.3d 389, 424
(5th Cir. 2010).
“The proponent need not prove to the judge that the expert’s testimony is correct, but she
must prove by a preponderance of the evidence that the testimony is reliable.” Johnson, 685 F.3d
at 459 (quoting Moore v. Ashland Chem., Inc., 151 F.3d 269, 276 (5th Cir. 1998) (en banc)). At
base, “the question of whether the expert is credible or the opinion is correct is generally a

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question for the fact finder, not the court.” Summit 6, LLC v. Samsung Elecs. Co., Ltd., 802 F.3d
1283, 1296 (Fed. Cir. 2015).
II. DR. BURGER
Genband moves to strike the Expert Report of Dr. Eric W. Burger, arguing his
anticipation opinions are improper because they do not show that each claim element is disclosed
“in a single prior art reference, or that the claimed invention was previously known or embodied
in a single prior art device or practice.” Minn. Min. & Mfg. Co. v. Johnson & Johnson
Orthopaedics, Inc., 976 F.2d 1559, 1565 (Fed. Cir. 1992).
A. Incorporation By Reference
Genband argues that Dr. Burger offers anticipation opinions in which he combines
multiple prior art references by arguing one is “incorporated by reference” in the other. (Dkt. No.
261 at 6–10). For example, Dr. Burger has opined that the Miller art incorporates by reference
the ITU-T and Bellcore standards. (Dkt. No. 261-2 at 5–6). He offers comparable opinions for
several other references. (Dkt. No. 261 at 8–10). Genband challenges these combinations of prior
art references as improper in the context of anticipation.
“Whether material is incorporated by reference into a host document is a question of
law.” Callaway Golf Co. v. Acushnet Co., 576 F.3d 1331, 1346 (Fed. Cir. 2009). “To incorporate
matter by reference, a host document must contain language clearly identifying the subject
matter which is incorporated and where it is to be found; a mere reference to another application,
or patent, or publication is not an incorporation of anything therein.” Id. (citations omitted).
Neither Dr. Burger’s report nor Metaswitch’s briefing demonstrates that any of the
challenged art incorporates other art by reference. The challenged art includes at best general or
vague references to the allegedly incorporated art (referring, e.g., to classes of standards rather

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than specific standards documents), and it does not “clearly identify[] the subject matter which is
incorporated and where it is to be found.”1 See (Dkt. No. 282 at 8–14).
Accordingly, Dr. Burger may not opine that any of the challenged art incorporates other
art by reference for purposes of his anticipation analysis. However, Dr. Burger may opine that a
piece of prior art, alone, anticipates. However, Metaswitch is correct that an expert may use his
knowledge of the relevant art to define technical terms and to explain the meaning of a prior art
disclosure. See Pfund v. United States, 40 Fed. Cl. 313, 345 n.16 (1998), aff’d, 178 F.3d 1313
(Fed. Cir. 1999) (noting that one of ordinary skill in the art, as both parties’ experts agreed,
would have understood the references to “coherent light” and “optical masers” in a prior art
document to refer to lasers). Thus Dr. Burger may, for example, explain the meaning of a term or
acronym in a prior art reference with reference to a standard that defines the term. See (Dkt. No.
282 at 9–10) (arguing certain relevant technical terms carry their glossary definitions in the
Intelligent Networking standards). However, Dr. Burger may not rely on other references to
supply missing claim limitations, nor may he state or imply that multiple references may be
considered as one for purposes of anticipation.
B. Combining Versions
Genband moves to strike Dr. Burger’s opinions regarding the Cisco Call Manager
system, Lucent MMCX system, Cisco Prior Art Gateway Systems, and Cisco Open Packet
Telephony system, arguing that Dr. Burger has “not established that a single version or particular
embodiment of any of these alleged prior art systems perform or practice the asserted claims.”

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In the case of the so-called “PINT” reference, which is a combination of two different
documents, the only argument for incorporation by reference is the fact that both documents
were authored by the same working group and “relate to the same underlying work.” (Dkt. No.
282-11 at ¶ 386). Neither Metaswitch nor Dr. Burger point to any cross-reference or citation in
the documents themselves.
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(Dkt. No. 261 at 10–15). Genband’s objections to Dr. Burger’s opinions parallel Metaswitch’s
objections that Dr. Beckmann “mixed and matched” product versions in his infringement and
practicing products opinions; they fail to persuade for the same reasons. See (Dkt. Nos. 413, 428)
Metaswitch cites evidence that the relevant versions of the allegedly invalidating prior art
operated in the same way for purposes of the claimed features. (Dkt. No. 282 at 14–19). This
evidence supports the reliability of Dr. Burger’s methodology. The Court will not strike these
opinions.
III. DR. WILLIAMS
Genband moves to strike Dr. Tim A. Williams’ testimony regarding invalidity and
non-infringement. (Dkt. No. 262).
A. Application of the Court’s Claim Construction
Genband argues that Dr. Williams has misapplied the Court’s construction of “telephone
number based device.” (Dkt. No. 262 at 6–8). The Court construed “telephone number based
device” as a “device identified by a telephone number for communication services.” (Dkt. No.
135). Genband contends that “[e]ven if a device did have a telephone number assigned to it, Dr.
Williams argued that it would not be a ‘telephone number based device’ because the telephone
number would be converted into an IP address.” (Dkt. No. 262).
Experts are not permitted to disregard or misapply the Court’s claim constructions. See
MarcTec, LLC v. Johnson & Johnson, 664 F.3d 907, 913 (Fed. Cir. 2012). However, nothing in
Genband’s motion or Dr. Williams’ report indicates that he has ignored the Court’s construction
or deviated from the Court’s holdings in the Claim Construction Order. Instead, Genband’s
disagreement is with Dr. Williams’ “comparison of the properly construed claims to the accused
product,” which is a question of fact. See Spectrum Pharms., Inc. v. Sandoz Inc., 802 F.3d 1326,

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1337 (Fed. Cir. 2015). Whether a particular device is “identified by a telephone number for
communication services” because it has a “telephone number assigned to it” is a fact question
properly elucidated by expert testimony and cross-examination. The Court will not strike Dr.
Williams’ application of the claim construction.
B. Opinions Regarding FireWall-1
Genband notes that Dr. Williams has “provided analysis of versions 3.0 and 4.0 of Check
Point’s FireWall-1 product and Check Point’s VPN-1 product” but argues he “also conclusorily
opines that other versions of FireWall-1 are prior art.” (Dkt. No. 262 at 8–9) Genband moves to
strike “these other, unnamed versions of FireWall-1.” (Id.)
Metaswitch responds that it “agrees to limit Dr. Williams’ expert opinion on invalidity to
Check Point Firewall-1 versions 3 and 4.” (Dkt. No. 279 at 17). In light of this representation, the
Court grants as agreed Genband’s request to exclude opinions on versions of FireWall-1 other
than versions 3 and 4.
C. Firewall Control Protocol
Dr. Williams’ Report includes citations and analysis for the June 2000 IETF Internet
Draft “Firewall Control Protocol Framework and Requirements” (“draft-kuthan-fcp-01”). See
(Dkt. No. 262 at 9–10). Dr. Williams’ Report also states that he “reserve[s] the right” to rely on
an earlier March 2000 version of this document (“draft-kuthan-fcp-00”). (Dkt. No. 262-6 at 211).
Genband argues that Dr. Williams should not be permitted to rely on the March 2000 report
because he did not analyze it in his report. Metaswitch responds that the “March 2000 Draft and
the June 2000 Draft include virtually identical disclosure of the same underlying work.” (Dkt.
No. 279 at 11–15).

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An expert may only rely on opinions disclosed in his report. See Fed. R. Civ. P.
26(a)(2)(B)(i). Metaswitch’s Response clearly acknowledges that there are some differences
between the two drafts. See (Dkt. No. 279 at 13). If the differences are in fact minor, Dr.
Williams could have charted both references with relative ease or he could have offered some
analysis comparing the two. Because he provided no analysis at all of the March 2000 draft in his
report, he will not be permitted to testify about the March 2000 draft.
IV. MR. LYNDE
Genband moves to strike certain opinions of Metaswitch’s Damages Expert Matthew R.
Lynde. (Dkt. No. 266).
A. FRAND Obligation Opinions
Genband argues that Mr. Lynde’s opinions regarding FRAND are legal conclusions about
whether Genband is contractually obligated to license its patents at a FRAND rate. (Dkt. No. 266
at 11–13). Genband asks the Court to strike these opinions as improper legal testimony by an
economic expert “as to the metes and bounds of the contracts at issue.” (Id. at 12).
Metaswitch responds that Mr. Lynde “is not offering any legal conclusions regarding
Genband’s contractual obligations to license on FRAND terms, and instead was asked to assume
for purposes of his analysis that Genband has a FRAND obligation under the relevant patent
policies.” (Dkt. No. 289 at 12). Consistent with Metaswitch’s representation, it is proper for Mr.
Lynde, as an economist, to assume for purposes of his analysis that a FRAND obligation exists
and to opine about what effect this obligation would have on damages. This analysis necessarily
requires him to analyze the scope and nature of the alleged FRAND commitment and to give his
opinions about its economic effect. An analysis of this type does not constitute improper legal
opinion. However, Mr. Lynde should use care not to run afoul of his and Metaswitch’s

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representations—he should not offer legal conclusions about whether Genband is actually bound
by a contractual FRAND obligation.
B. Comparable Patent Pool
Genband asks the Court to strike Mr. Lynde’s reliance on the W-CDMA patent pool
license as evidence of the FRAND rate in this case. (Dkt. No. 266 at 13–16). Genband argues
that this patent pool relates to different technology that is not sufficiently comparable to the
patents-in-suit.
The Federal Circuit has “long required district courts performing reasonable royalty
calculations to exercise vigilance when considering past licenses to technologies other than the
patent in suit.” ResQNet.com, Inc. v. Lansa, Inc,, 594 F.3d 860, 869 (Fed. Cir. 2010). With that
admonition in mind, the Court nevertheless concludes that Mr. Lynde’s testimony is supported
by sufficient evidence of comparability to render it admissible under Daubert. Mr. Lynde relies
on the opinion of Metaswitch’s technical expert Dr. Williams to determine that the technology
licensed under the W-CDMA patent pool agreement is technically and economically comparable
to the technology at issue in this case. (Dkt. No. 266-3 at ¶ 46, n.92). His opinions are supported
by reliable economic and technical analysis.
Likewise, Mr. Lynde’s opinions about the magnitude of the multiplier he applies are
supported by analysis and are not “arbitrary” like the 25% rule of thumb. See Uniloc USA, Inc. v.
Microsoft Corp., 632 F.3d 1292, 1318 (Fed. Cir. 2011). Mr. Lynde, relying upon his expertise as
an economist, cites the need to adjust the patent pool licensing rate based on real-world factors
such as the participation rate and the value of expected cross-licenses. (Dkt. No. 266-3 at ¶ 47).
Based on these considerations, he determines that a multiplier of three is appropriate. (Id.)

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Accordingly, the W-CDMA patent pool is sufficiently comparable to render Dr. Lynde’s
opinions admissible, and his multiplier opinions are supported by analysis. The precise degree of
comparability goes to weight and may be explored by the parties on cross examination.
C. Top Down Approach
Finally, Genband criticizes Mr. Lynde’s “top down” approach, which he uses to derive an
alternative FRAND royalty rate. (Dkt. No. 266 at 16–17; Dkt. No. 266-3 at ¶¶ 49–51). Mr.
Lynde conducts his top down analysis by “examining the operating profit associated with the
smallest salable unit within the accused product, and apportioning that profit based on the value
of Genband’s SEPs to the VoIP standard as a whole.” (Dkt. No. 289 at 16).
However, the way Mr. Lynde determines the fraction of the value of the “VoIP standard
as a whole” to which Genband’s patents are attributable is by counting the number of companies
that provided intellectual property disclosures to the relevant VoIP standard setting
organizations, and assuming that the value of each participant company’s patent portfolio is the
same. This approach ignores the size of each company, the number of patents in each company’s
portfolio, and the differences in value between patents—his approach necessarily assumes that
every participant company’s patent portfolio was exactly the same as Nortel’s. Mr. Lynde’s only
justification for glossing over these details is that “Nortel is one of many large technology
companies with significant patent portfolios in this area.” (Dkt. No. 266-3 at ¶ 50). He does not
attempt to quantitatively (or even qualitatively) compare Nortel’s portfolio to the portfolios of
the other participant companies.
Mr. Lynde’s top down approach is highly speculative and not supported by sufficient
“facts or data.” See In re Innovatio IP Ventures, LLC, 2013 U.S. Dist. LEXIS 144061 at *168
(N.D. Ill. Sept. 27, 2013) (top down approach “requires verifiable data points, such as the

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number of 802.11 standards-essential patents”). Mr. Lynde admits in his report that “there is no
information available with regard to the specific patents that may be covered under the blanket
declaration by a given company.” (Dkt. No. 266-3 at ¶ 50). An absence of information is not a
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license to speculate. Mr. Lynde’s opinions relating to the “top down” approach are excluded.
V. CONCLUSION
For the foregoing reasons, Genband’s Motion to Strike Opinions of Dr. Eric W. Burger
on Invalidity (Dkt. No. 261) is GRANTED-IN-PART and DENIED-IN-PART as set forth in
this Order. Genband’s Motion to Strike Certain Opinions of Dr. Tim A. Williams (Dkt. No. 262)
is GRANTED-IN-PART and DENIED-IN-PART as set forth in this Order. Genband’s Motion
to Exclude Certain Opinions of Metaswitch’s Damages Expert Matthew R. Lynde (Dkt. No. 266)
is GRANTED-IN-PART and DENIED-IN-PART as set forth in this Order.
SIGNED this 3rd day of January, 2012.
SIGNED this 9th day of January, 2016.

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ROY S. PAYNE
UNITED STATES MAGISTRATE JUDGE

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