Mirror Worlds, LLC v. Apple, Inc.

Filing 57

AFFIDAVIT in Support re #56 MOTION for Leave to File First Amended Answer, Affirmative Defenses, and Counterclaims (Declaration of Nicholas A. Brown) filed by Apple, Inc.. (Attachments: #1 Exhibit A, #2 Exhibit B, #3 Exhibit C)(Mehta, Sonal)

Mirror Worlds, LLC v. Apple, Inc.

Doc. 57 Att. 2

..JENNER&BLOCK
December 1 6 , 2 0 0 8
J e n n e r & Block LLP 919 T h i r d A v e n u e 37th Floor N e w York, N Y 1 0 0 2 2 Tel 2 1 2 - 8 9 1 - 1 6 0 0 www.jenner.com Chicago Dallas New York Washington, DC

BY E - M a i l

Kenneth L. Stein Direct Dial: [phone] [e-mail]

Nicholas A. Brown, Esq. Weil, Gotshal & Manges LLP 201 Redwood Shores Parkway R e d w o o d Shores, C A 9 4 0 6 5 Re: D e a r Nick: I am writing regarding y o u r request that we consent to A p p l e ' s motion for leave to file its First Amended Answer, Affirmative Defenses and Counterclaims ("Amended Answer"), which seeks to (a) add Mirror Worlds Technologies, Inc. as a party, and (b) assert a new counterclaim for infringement o f A p p l e ' s U.S. Patent No. 6,613,101. After due consideration, we have decided to oppose that motion. T h e deadline for joining additional parties and asserting counterclaims was October 20, 2008. See Docket Control Order (Dkt. 32). Accordingly, under well-settled law, Apple is required to demonstrate "good cause" for the amendment. See Fahim v. Mariott Hotel Servs., Inc., -- F.3d - , 2 0 0 8 W L 5136134, at *3 (5th Cir. Dec. 8 , 2 0 0 8 ) ("[O]nce a scheduling order has been entered, it m a y b e modified only for g o o d c a u s e and w i t h t h e j u d g e ' s c o n s e n t . " ) (internal q u o t a t i o n m a r k s a n d c i t a t i o n omitted). G o o d cause "requires a party to show that the deadlines cannot reasonably b e m e t despite the diligence o f the party needing the extension." Id. (internal quotation marks and citation omitted). Factors relevant to good cause include: " ( 1 ) the explanation for the failure to timely move for leave to amend; (2) the importance o f the amendment; (3) potential prejudice in allowing the amendment; and (4) the availability o f a continuance to cure such prejudice." Id. (internal q u o t a t i o n m a r k s and c i t a t i o n o m i t t e d ) . W e do not believe that Apple has good cause for filing its untimely Amended Answer. Certainly, Apple cannot claim that it did not know before the October 20, 2008 deadline o f its o w n p a t e n t ( w h i c h i s s u e d i n 2 0 0 3 ) o r o f Mirror Worlds T e c h n o l o g i e s , I n c . ' s allegedly infringing products (which were sold at least as early as 2002). There is no question that Apple could have m e t t h e O c t o b e r 2 0 t h d e a d l i n e w i t h diligence. Apple has offered no explanation for its failure to timely assert its new counterclaim and add Mirror Worlds Technologies, Inc. as a party, and, for the reasons j u s t explained, we do not believe it can offer one that satisfies the "good cause" requirement. In addition, A p p l e ' s new

M i r r o r Worlds, L L C v. Apple, Inc., Civil A c t i o n No. 6:08 c v 8 8 L E D

Dockets.Justia.com

Nicholas A. B r o w n , Esq. D e c e m b e r 16, 2008 Page 2

c o u n t e r c l a i m is not i m p o r t a n t to t h e adjudication o f the p e n d i n g case. It i s b a s i c a l l y a completely new and unrelated p a t e n t i n f r i n g e m e n t action, w h i c h does n o t relate to a n y claims o r defenses in the p e n d i n g action.
I t also a p p e a r s to us t h a t A p p l e is s e e k i n g to i n j e c t its new c o u n t e r c l a i m into this case s i m p l y for strategic reasons, rather than to address supposed d a m a g e s c a u s e d b y the alleged i n f r i n g e m e n t . I n d e e d , t h e p o t e n t i a l d a m a g e s t h a t A p p l e c a n r e c o v e r , e v e n i f s u c c e s s f u l , are negligible. I

Further, M i r r o r W o r l d s w o u l d b e p r e j u d i c e d b y t h e a d d i t i o n o f A p p l e ' s n e w counterclaim. G i v e n that A p p l e seeks to a d d an entirely n e w p a r t y a n d a n entirely n e w patent after the parties h a v e filed t h e i r i n f r i n g e m e n t and i n v a l i d i t y c o n t e n t i o n s , i f the c o u n t e r c l a i m went forward i n this case, t h e current case s c h e d u l e w o u l d have to b e m o d i f i e d and extended to allow for new, additional, i n f r i n g e m e n t and invalidity contentions, as well as for additional discovery, t h e p o s s i b l e j o i n d e r o f o t h e r p a r t i e s , a n d t h e p o s s i b l e a s s e r t i o n o f o t h e r c l a i m s . T h i s too m i l i t a t e s against A p p l e ' s amendment. See Phil. Indem. Ins. Co., 2008 W L 5191910, at *12 (N.D. Tex. Dec, 10, 2008) ( d e n y i n g l e a v e to amend w h e r e a m e n d m e n t would d i s r u p t trial schedule and o t h e r dates: " N o t o n l y w o u l d g r a n t i n g l e a v e h a v e an a d v e r s e i m p a c t o n t h e t i m e l y r e s o l u t i o n o f this case, i t w o u l d also a f f e c t o t h e r s e t t i n g s o n t h e c o u r t ' s d o c k e t . " ) . Moreover, this is already an e x t r e m e l y c o m p l i c a t e d case, i n v o l v i n g m a n y o f A p p l e ' s products. W e do n o t b e l i e v e that it is appropriate to further c o m p l i c a t e it b y injecting additional, unrelated i s s u e s - e s p e c i a l l y given that t h e (minimal) sales o f t h e a l l e g e d l y infringing products o c c u r r e d y e a r s ago b y a c o m p a n y t h a t h a s l o n g c e a s e d b u s i n e s s o p e r a t i o n s . F o r at least t h e foregoing reasons, w e o p p o s e A p p l e ' s r e q u e s t for leave to file its p r o p o s e d A m e n d e d A n s w e r . I f y o u wish to discuss this m a t t e r further, p l e a s e do not hesitate to c o n t a c t me. Sincerely,

K e n n e t h L. S t e i n

7~tf ---

I A s I a m s u r e y o u k n o w , u n d e r 35 U.S.C. § 286, A p p l e c a n n o t r e c o v e r d a m a g e s for infringements o c c u r r i n g m o r e than six years p r i o r to the filing o f its counterclaim. However, during the p a s t six y e a r s - o r m o r e p r e c i s e l y from January 2003 until the fall o f 2004, when Mirror W o r l d s T e c h n o l o g i e s , Inc. ceased d o i n g b u s i n e s s - M i r r o r W o r l d s Technologies, I n c . ' s total s a l e s r e v e n u e w a s o n l y a p p r o x i m a t e l y $ 1 5 0 , 0 0 0 ( w h i c h i n c l u d e s s a l e s t h a t a r e n o t implicated b y A p p l e ' s counterclaim). G i v e n s u c h small revenue, even i f successful with its counterclaim, A p p l e ' s m o n e t a r y r e c o v e r y would b e de minimis. In addition, as w e discussed, i f Apple did n o t m a r k its products, as required u n d e r 35 U . S . c . § 287, t h e r e w o u l d b e no potential damages.

Nicholas A. Brown, Esq. December 16, 2008 Page 3

cc:

Joseph Diamante, Esq. Richard H. An, Esq. Otis W. Carroll, Esq. Sona} N. Mehta, Esq. Stefani Smith, Esq.