Bedrock Computer Technologies, LLC v. Softlayer Technologies, Inc. et al

Filing 842

Opposed MOTION for Attorney Fees Yahoo!'s Motion to Declare this an Exceptional Case and for Attorneys' Fees and Costs Pursuant to 35 USC Sec. 285 by Yahoo! Inc.. (Attachments: #1 Affidavit B. James Decl., #2 Exhibit 1, #3 Exhibit 2, #4 Exhibit 3, #5 Exhibit 4, #6 Exhibit 5, #7 Exhibit 6, #8 Exhibit 7, #9 Exhibit 8, #10 Exhibit 9, #11 Exhibit 10, #12 Exhibit 11, #13 Exhibit 12, #14 Exhibit 13, #15 Exhibit 14, #16 Exhibit 15, #17 Exhibit 16, #18 Exhibit 17, #19 Exhibit 18, #20 Exhibit 19, #21 Exhibit 20, #22 Exhibit 21, #23 Exhibit 22, #24 Exhibit 23, #25 Exhibit 24, #26 Exhibit 25)(Chaikovsky, Yar) (Additional attachment(s) added on 6/7/2011: #27 Text of Proposed Order) (mll, ).

EXHIBIT 2

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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
TYLER DIVISION

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BEDROCK COMPUTER
TECHNOLOGIES LLC

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DOCKET NO. 6:09cv269

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-vs-

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YAHOO!, INC.
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)

Tyler, Texas
9:00 a.m.
May 10, 2011

TRANSCRIPT OF TRIAL
BEFORE THE HONORABLE LEONARD DAVIS,
UNITED STATES DISTRICT JUDGE
A P P E A R A N C E S

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FOR THE PLAINTIFF:
MR. DOUGLAS A. CAWLEY
MR. THEODORE STEVENSON, III
MR. SCOTT W. HEJNY
MR. JASON D. CASSADY
McKOOL SMITH
300 Crescent Court, Ste. 500
Dallas, TX 75201
MR. ROBERT M. PARKER
MR. ROBERT CHRISTOPHER BUNT
PARKER, BUNT & AINSWORTH
100 E. Ferguson, Ste. 1114
Tyler, TX 75702
COURT REPORTERS:
MS. JUDY WERLINGER
MS. SHEA SLOAN
Proceedings taken by Machine Stenotype; transcript was
produced by a Computer.

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Yahoo! has proved the patent invalid, then in response

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to Question 2, where you're asked if the patent is

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invalid, your answer should be no.

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The next question Judge Davis asked you
to consider is:

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Was Yahoo!'s infringement willful?
Here's some testimony that you heard

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during the course of the trial.

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were by deposition and a third was live.

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The first two things

Mr. Barnes of Yahoo! was asked:

Do you

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know if anybody at Yahoo! reviews patents to determine

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if the programs and servers and technology it's going to

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put out infringe those patents?

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He says:

No, I don't have that

knowledge.

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Then Mr. Reed of Yahoo! was asked this

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question:

Have you ever seen anyone at Yahoo! actually

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consider someone else's patent property rights in

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evaluating whether or not to use an operating system on

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Yahoo!'s servers?

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He answers:

Not that I can recall.

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And then you will remember when Mr. Filo

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took the stand and I asked him:

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is, were any patent searches done regarding the move

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from FreeBSD to Linux by Yahoo!?

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Answer:

So my question to you

Not that I'm aware of, but,

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okay, I can't say for certain that we did not.

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And then:

But you don't know of any?

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Answer:

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In short, Ladies and Gentlemen, no one

I do not know.

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from Yahoo!, from the Chief Yahoo! on down, has told you

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that Yahoo! paid a bit of attention to anyone else's

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patent rights when they decided to use this code.

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This explains this statement from Mr.

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Kuznetsov in this e-mail when he advises you at Yahoo!:

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I believe you should seek for an expert in loopholes of

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patent rules.

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Of course, Yahoo! is going to tell you,

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well, their infringement wasn't willful.

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further at Mr. Kuznetsov's e-mail.

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But let's look

This is the e-mail that Yahoo! got in
December of 2010, while this lawsuit was going on.

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There's no question that at that point in

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time Yahoo! knew about the patent, they had already been

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sued for it.

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Mr. Kuznetsov, the man who wrote the old

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Kuznetsov code, says:

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written by me does not actually collide with the

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aforementioned patent; my code uses quite different

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techniques.

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My analysis showed that code

But then he goes on to say:

But current

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Linux kernel actually contains logic which could be

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considered as infringing the patent.

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by saying:

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references describing the idea before 1999 when the

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patent was issued.

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And he concludes

Unfortunately, I could not find any

Ladies and Gentlemen, Yahoo! had this

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statement from the man who wrote the prior Linux code

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and was part of the team that put the infringing code

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into Linux.

They were informed by him that the patent

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was valid and that they infringed it.

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suggest to you the evidence shows they simply didn't

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care.

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But I will

If you conclude the evidence shows that

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Yahoo!'s infringement was willful, then you should

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answer Question 3 yes.

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Then the last question that Judge Davis

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is going to ask you to consider is:

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entitled to as a reasonable royalty?

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How much is Bedrock

You remember this testimony from Dr.

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Jones.

He testified about his testing, but I will talk

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about it in a little more detail in a minute.

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bottom line is, he turned the invention on and off and

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tested what benefit it gave to a system like Yahoo!'s.

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And he found that there was a 10 to 20 percent benefit

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from the use of the invention.

But the

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64,000.

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The only testimony you have heard about

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realistic traffic levels is from Dr. Jones, and that

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shows a 10 to 20 percent gain in efficiency.

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Well, if you don't believe the test is
bad, maybe you believe Yahoo! never deletes any records.

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Well, Dr. Jones talked about that

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yesterday, too.

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candidate code run?

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Yes.

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And said in his answer:

Does the

We saw Mr. Turner's results where

he showed that it ran in deleted records.

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Second, at the traffic levels that Yahoo!

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runs at, my tests show a performance advantage of the

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'120.

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at the record removals, indicate that records are

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removed at those traffic levels.

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And then the additional tests I've run, looking

Well, if you don't buy it's a bad test

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and you don't buy that it deletes records, how about

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there's other devices involved?

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You will remember we heard testimony

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about all the devices that Yahoo! has.

Some of them are

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on the table here -- the router, the firewall, the

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switch, the load balancers -- all of those, Ladies and

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Gentlemen, have one thing in common:

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to filter out malicious traffic.

They're designed

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That's not what Dr. Jones is testing.

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What Dr. Jones is testing is the efficiency gain from

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valid traffic.

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All of these devices piled up on the
table have nothing to do with that.

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Well, if you don't buy that, maybe you'll

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buy that it's only 40 lines of code.

You heard the

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testimony from everyone who talked about this.

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can't measure the value of the code by how long it is.

You

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Finally you heard, well, about how about

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it's worthless because we could go back to FreeBSD, the

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software we used before.

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This is the Yahoo! document that shows

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that the Yahoo! software runs from one to six --

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actually one-and-a-half to six times faster and better

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on Linux.

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percent of their servers are running Linux.

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That's why Mr. Filo admitted that today 75

Ladies and Gentlemen, if you believe that

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the evidence you heard in the case shows that there's

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substantial cost-savings to Yahoo! and that a fair

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division of that cost-savings is to split it between the

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holder of the patent and Yahoo!, then your answer to

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Question No. 4 should be $32 million.

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Ladies and Gentlemen, I thank you for
your attention, and I look forward to saying a few more

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