Eolas Technologies Incorporated v. Adobe Systems Incorporated et al

Filing 839

RESPONSE in Opposition re 815 Opposed MOTION for Leave to File Supplement to its PR 3-1 Infringement Contentions with Respect to Google Music and Google+Opposed MOTION for Leave to File Supplement to its PR 3-1 Infringement Contentions with Respect to Google Music and Google+ [Corrected] filed by Google Inc.. (Attachments: # 1 Declaration of Han Xu, # 2 Exhibit A - Music Beta, # 3 Exhibit B - Google +, # 4 Exhibit C - Davis-Lynch, # 5 Exhibit D - Power-One, # 6 Exhibit E - Eon Corp, # 7 Text of Proposed Order)(Jones, Michael)

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

EOLAS TECHNOLOGIES
INCORPORATED,
PLAINTIFF,
v.
ADOBE SYSTEMS INC., et al.,
DEFENDANTS.

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Civil Action No. 6:09-CV-446-LED

JURY TRIAL DEMANDED

GOOGLE’S OPPOSITION TO EOLAS’ MOTION FOR LEAVE TO SUPPLEMENT ITS
P.R. 3-1 INFRINGEMENT CONTENTIONS WITH RESPECT TO GOOGLE MUSIC
AND GOOGLE+

TABLE OF CONTENTS
I.

INTRODUCTION ...............................................................................................................1

II.

FACTS .................................................................................................................................2

III.

DISCUSSION ......................................................................................................................4
A.
B.

Eolas Has Not Demonstrated That The Newly Accused Products Are Important
To Its Case .....................................................................................................................6

C.

Google Will Be Severely Prejudiced If Eolas Is Allowed To Amend Its
Infringement Contentions Two Months Before Trial ....................................................7

D.
IV.

Eolas Has Not Presented Compelling Evidence That The New Products Are
Infringing And Should Be Added At This Late Stage of Litigation ..............................4

A Continuance Would Not Cure The Prejudice To Google Given Eolas’ Apparent
Attempt To Accuse Every New Product Released By Google ......................................8
CONCLUSION ....................................................................................................................9

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TABLE OF AUTHORITIES
Page(s)
CASES
Computer Acceleration Corp. v. Microsoft Corp.,
503 F.Supp.2d 819 (E.D. Tex., 2007) ........................................................................................7
Davis-Lynch, Inc. v. Weatherford Int’l, Inc.,
No. 6:07-CV-559, 2009 WL 81874 (E.D. Tex. April 24, 2009) ...................................4, 6, 7, 8
EON Corp. IP Holdings, LLC v. Sensus USA Inc.,
No. 6:09-cv-116, 2010, 2010 WL 346218 (E.D. Tex. January 21, 2010) .................................5
Power-One, Inc. v. Artesyn Technologies, Inc.,
No. 2:05-CV-463, 2007 WL 2986671 (E.D. Tex, Oct. 11, 2007) .....................................4, 5, 7
S & W Enters., L.L.C. v. Southtrust Bank of Ala., NA,
315 F.3d 533 (5th Cir. 2003) .....................................................................................................4
STMicroelectronics, Inc. v. Motorola, Inc.,
307 F. Supp. 2d 845 (E.D. Tex. 2004) .......................................................................................4
OTHER AUTHORITIES
Local Rule CV-7 ........................................................................................................................3, 10
Local Patent Rule 3-1.......................................................................................................................2
Local Patent Rule 3-7.......................................................................................................................4

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I.

INTRODUCTION
Google respectfully requests that this Court deny Eolas’ Motion for Leave to Supplement

its P.R. 3-1 Infringement Contentions with Respect to Google Music and Google+ (“Motion to
Supplement”) because Google will be severely prejudiced if Eolas is allowed to amend its
Infringement Contentions to add new products at this critically late stage of litigation,
particularly given the vague and conclusory nature of the proposed amendments. Eolas’ original
Infringement Contentions, served on Google more than sixteen months ago, accused no less than
“eighteen categories of Google products” of infringement. Motion to Supplement (Dkt. 815), at
2. Eolas subsequently served second and third sets of supplemental Infringement Contentions on
Google, bringing the total number of accused products to twenty-six.
Now, a week before the close of discovery and two months before trial, Eolas wants to
supplement its Infringement Contentions for a fourth time to include two additional products:
Google Music and Google+.
Eolas presents no compelling evidence that the newly released Google Music and
Google+ are infringing, nor has Eolas demonstrated why its proposed amendments are
sufficiently important to warrant the addition of new products at this late juncture. Eolas’
proposed contentions contain vague allegations that merely mimic the claim language and fail to
put Google on notice as to the actual functionality accused. Moreover, the prejudice to Google
would be significant, as Google would need to develop new defenses, prepare new witnesses,
and expend additional resources at these final stages of an already complex and costly litigation.
The harm to Google greatly outweighs any purported importance of these amendments,
particularly as the new products are in very limited circulation and represent negligible increases
in potential damages. Finally, a continuance cannot cure any prejudice to Google because it is

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apparent that Eolas will simply use each new product release by Google between now and the
eve of trial as an attempt to “litigate by ambush” and supplement its Infringement Contentions
yet again.
II.

FACTS
On March 5, 2010, as required by Local Patent Rule 3-1, Eolas served its Disclosure of

Asserted Claims and Infringement Contentions (“Infringement Contentions”) on Google
accusing “eighteen categories of Google products” of infringement. Motion to Supplement at 2.
On June 24, 2010, Eolas served on Google its first Supplemental P.R. 3-1 and 3-2 Infringement
Contentions for Episodic.com, a product not previously accused of infringement. On September
28, 2010, Eolas moved the Court for leave to serve its second supplemental Infringement
Contentions to add Google Instant. Google did not oppose Eolas’ motion. (Dkt. 426).
On April 18, 2011, Eolas moved the Court again for leave to serve its third supplemental
Infringement Contentions.

See Eolas’ Motion for Leave to Supplement its Infringement

Contentions for Android 3.0 (Dkt. 634), denied as moot (Dkt. 743). Although Eolas’ motion
suggested that it merely sought to add Android 3.0 to the list of accused products, in fact the
amended contentions significantly modified Eolas’ infringement theories with respect to Android
and accused the YouTube app, which was available at the time of Eolas’ original Infringement
Contentions.

See Google’s Opposition to Eolas’ Motion for Leave to Supplement its

Infringement Contentions for Android 3.0 (Dkt. 647), at 1. At the hearing, when Eolas withdrew
this belatedly disclosed infringement theory, Google stipulated that Android 3.0 could be added
to the list of accused products.

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On May 10, 2011, Google announced the limited release of Google Music by Google
(“Google Music”). Google Music allows users to upload their own music for streaming purposes
for free. It is currently in beta testing, hence the official name “Music Beta,” and is available to
by invitation only. See Ex. A.
Google launched Google+ on June 28, 2011 as a social networking service that
integrates a number of Google services, allowing users to share contacts, photos, videos, and
search topics. It is currently in “limited field trial” testing with a “small number of people.” See
Ex. B.
Following the limited releases of Google Music and Google+, Eolas indicated to Google
that it wants to supplement its Infringement Contentions with respect to those products. Google
reiterated to Eolas both via correspondence and at the Local Rule CV-7 meet and confer that
adding additional products at this late stage in the case would be highly prejudicial to Google,
particularly in view of the extensive discovery requests from Eolas to which Google has
responded to, which did not include requests related to these additional products. Motion to
Supplement, Ex. 11 (e-mail from Mr. Story to Mr. Mierzejewski (July 29, 2011)).
On August 2, 2011, Eolas filed the present motion to supplement its Infringement
Contentions, for the fourth time, to add the additional Google Music and Google+ products.
Discovery is scheduled to close on August 12, 2011 (Dkt. 670), dispositive motions are due on
August 15, 2011 (Dkt. 816), rebuttal expert reports are due on August 17, 2011 (Dkt. 773), and
trial is scheduled for October 11, 2011 (Dkt. 249).

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III.

DISCUSSION
“The purpose of Local Patent Rules is to ‘further the goal of full, timely discovery and

provide all parties with adequate notice and information with which to litigate their cases, not to
create supposed loopholes through which parties may practice litigation by ambush.’” DavisLynch, Inc. v. Weatherford Int’l, Inc., No. 6:07-CV-559, 2009 WL 81874, *3-4 (E.D. Tex. April
24, 2009) (attached as Exhibit C).
“Patent Rule 3-7 incorporates Rule 16(b)’s good cause standard by stating ‘amendment or
modification of the Preliminary or Final Infringement Contentions . . . may be made only by
order of the Court, which shall be entered only upon a showing of good cause.’”
STMicroelectronics, Inc. v. Motorola, Inc., 307 F. Supp. 2d 845, 849 (E.D. Tex. 2004) (quoting
P.R. 3-7). The Court has broad discretion to allow scheduling order modifications and considers
four factors to determine if modification is appropriate: (1) the explanation for the party’s failure
to meet the deadline, (2) the importance of what the Court is excluding, (3) the potential
prejudice if the Court allows the thing that would be excluded, and (4) the availability of a
continuance to cure such prejudice. S & W Enters., L.L.C. v. Southtrust Bank of Ala., NA, 315
F.3d 533, 535-36 (5th Cir. 2003).
A.

Eolas Has Not Presented Compelling Evidence That The New Products Are
Infringing And Should Be Added At This Late Stage of Litigation

The law is clear that significant justification is required to add new products late in an
infringement litigation. For example, in a case where this Court denied plaintiff’s motion to
amend its Infringement Contentions to add two new products one month before trial, the Court
noted that “there should be at least some solid justification for allowing new products into the
litigation this close to trial.” Power-One, Inc. v. Artesyn Technologies, Inc., No. 2:05-CV-463,

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2007 WL 2986671, *10 (E.D. Tex, Oct. 11, 2007) (denying Power-One’s motion to amend its
Infringement Contentions where “Power-One has not presented enough compelling evidence that
these products are infringing and should be included in the present litigation.”) (emphasis added)
(attached as Exhibit D).
Eolas has not presented enough compelling evidence that these newly released products
are infringing and should be added at this late stage of litigation. See id. Eolas’ Motion to
Supplement simply alleges that the two products “utilize Eolas’ patented technologies in
materially the same way as Google’s other accused products” and that both products allow users
to “play, pause, and adjust volume controls . . . interactively through the browser.” Motion to
Supplement at 7.
Moreover, Eolas’ proposed contentions contain vague allegations that merely mimic the
claim language and fail to put Google on notice as to the actual functionality accused. For
example, independent claim 36 of ‘985 patent requires “identifying an embed text format which
corresponds to a first location in the document, where the embed text format specifies the
location of at least an object.” Eolas’ proposed contentions merely allege, in a conclusory
fashion, that Google Music infringes this claim because “Google’s servers format the
communications so that the browser on the client workstation identifies an embed text format
which corresponds to a first location in the document, where the embed text format specifies the
location of at least portion of an object.” Motion to Supplement, Ex. 12, at 17 (claim language
italicized). Eolas’ proposed contentions then cites to a block of code spanning six pages without
any explanation as to which, or how, any portion of the cited block contains the alleged “embed
text format” that “corresponds to a first location in the document” and “specifies the location of

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at least an object.”1 Indeed, Eolas does not even identify how the six pages of code relate to any
functionality of Google Music. See EON Corp. IP Holdings, LLC v. Sensus USA Inc., No. 6:09cv-116, 2010 WL 346218 at *3 (E.D. Tex. January 21, 2010) (“Simply block quoting references,
however, does not necessarily advise a defendant of where a plaintiff believes asserted elements
are found in an instrumentality. Similarly, although citing documents has a role and may further
notice, it does not, in and of itself, fulfill the notice function. [A patentee] must put forward its
position as to where it believes particular limitations are met by the accused instrumentalities”)
(attached as Exhibit E).
Eolas’ attempt to add new products supported only by vague, conclusory Infringement
Contentions two months before trial is not sufficiently compelling to warrant a supplementation
at this late stage of litigation, and, even if Eolas had been diligent, would be significantly
outweighed by the other factors discussed below.
B.

Eolas Has Not Demonstrated That The Newly Accused Products Are
Important To Its Case

Eolas has not demonstrated that the two accused products, which are currently under very
limited beta and trial releases, are crucial to its infringement case that already encompasses
twenty accused Google products. Eolas offers no discussion on the importance of the proposed
amendment other than the broad allegations that these new products “utilize Eolas’ patented
technologies” and that the alternative would require Eolas to initiate duplicative litigation.
Eolas’ purported justifications for the importance of Google Music and Google+ are
insufficient under relevant case law. In Davis-Lynch, Inc. v. Weatherford Int'l, Inc., this Court

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Compare Motion to Supplement, Ex. 12, at 19-25 (accusing 6 pages of scripts as the “embed text format”) with
‘985 Patent, Col. 12, Table II (describing “embed text format” as 6 lines of a HTML tag).

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denied plaintiff’s motion to amend its Infringement Contentions to add new products seven
months before dispositive motions were due, despite plaintiff’s insistence that the additional
products were “important because they make up seventy-five percent of [defendant’s] sales.”
2009 WL 81874 at *4. Here, the increase in potential damages is comparatively miniscule, given
that the two products are recently released, offered for free, have not generated advertising
revenue, and are being made available to only a limited few. Indeed, Eolas acknowledges that
only “minimal additional discovery related to damages” are needed. Motion to Supplement at 7.
Moreover, exclusion of these additional products will not result in dismissal of Eolas’
case in its entirety—far from it. This case will still proceed against the twenty-six Google
products currently accused of infringement.2 See id. (noting that exclusion of additional products
will not result in dismissal of plaintiff’s case and the case will still proceed against the products
already accused); see also Computer Acceleration Corp. v. Microsoft Corp., 503 F.Supp.2d 819,
825 (E.D. Tex., 2007) (excluding products from a case is not the same as granting a default
judgment against a Plaintiff).
C.

Google Will Be Severely Prejudiced If Eolas Is Allowed To Amend Its
Infringement Contentions Two Months Before Trial

Google will be severely prejudiced if Eolas is allowed to add new products to the case at
this critical stage of litigation and derail Google’s trial preparation. In Power-One, this Court
found prejudice to defendants where plaintiff sought to add new products one month before trial.
2007 WL 2986671, *10. Similarly, in Davis-Lynch, this Court found that prejudice to defendant
2

The twenty-six accused products include: en.blog.orkut.com, picasa.google.com, www.episodic.com,
DoubleClick.com, services.google.com, Finance.Google.com, www.google.com/phone, Video.Google.com,
google.com/latitude, google.com/googlevoice, sketchup.google.com, news.google.com, Google AdSense, Google
Documents, Google Gmail, Google Instant, Google Search Suggest, Google Search functionality, Google Maps,
Google Maps Web Service, iGoogle, Android Operating System, Google Chrome, www.youtube.com, YouTube
Search Suggest, and YouTube HTML5.

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would be “significant” “in light of the looming deadlines” where plaintiff sought to add new
accused products into the case seven months before dispositive motions were due. 2009 WL
81874, *5.
Allowing Eolas to amend its Infringement Contentions to include two additional
products a week before the end of discovery and two months before trial would be unduly
burdensome and disruptive to Google’s trial preparation. Google would need to develop new
defenses in response to Eolas’ new Infringement Contentions, prepare new witnesses
knowledgeable on the two products, and expend additional resources in an already complex and
costly litigation.

This would be rendered all the more difficult because Eolas’ proposed

contentions merely restate the claim language, lack adequate evidentiary support, and fail to
provide notice to Google with respect to the specific functionality being accused. See discussion,
supra, at 6-7. With discovery ending in two days, dispositive motions due in five days, rebuttal
expert reports due in a week, and trial in two months, the prejudice to Google would be
“significant,” particularly “in light of the looming deadlines.”3 Id.
D.

A Continuance Would Not Cure The Prejudice To Google Given Eolas’
Apparent Attempt To Accuse Every New Product Released By Google

Eolas’ latest tactics also demonstrate why a continuance cannot cure any prejudice to
Google. Google is constantly working to introduce new innovative products to Internet users.
Indeed, Google Music and Google+ represent the latest ventures by Google to help make the
Internet more accessible to users, for free. Eolas should not be allowed to use every new release
by Google as an attempt to “litigate by ambush” and supplement its Infringement Contentions

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Even had Eolas filed this motion earlier, Google would still have been faced with the then-looming deadlines at the
time.

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because it misleadingly contends that its patents are used by all modern Internet technology.4
Google’s ability to adequately prepare its case for trial will be seriously hampered because it
may be forced, at any moment, to respond to new Infringement Contentions, divert its resources
and expend costs in preparing new defenses.

A continuance would create only additional

prejudice to Google, both in its ability to defend this case and in the cost required to do so.
IV.

CONCLUSION
For the foregoing reasons, Google respectfully requests that this Court deny Eolas’

Motion for Leave to Supplement its P.R. 3-1 Infringement Contentions with Respect to Google
Music and Google+.

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Indeed, as evident from Eolas’ allegation that Google failed to identify these products or include them in its
productions “despite what must have been months if not years of planning and development,” Eolas unreasonably
expects Google to disclose and produce information on any and all products being planned or developed, even
before they’re released, and even though no analogous product has been accused of infringement. See Motion to
Supplement, at 5.

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Dated: August 11, 2011

Respectfully Submitted,
By: /s/ Sasha G. Rao, with permission by
Michael E. Jones
James R. Batchelder (pro hac vice)
[e-mail]
Sasha G. Rao (pro hac vice)
[e-mail]
Mark D. Rowland
[e-mail]
Brandon Stroy (pro hac vice)
[e-mail]
Lauren N Robinson (pro hac vice)
[e-mail]
Rebecca R. Hermes (pro hac vice)
[e-mail]
Han Xu (pro hac vice)
[e-mail]
ROPES & GRAY LLP
1900 University Avenue, 6th Floor
East Palo Alto, California 94303-2284
Telephone: [phone]
Facsimile: [phone]
Michael E. Jones (Bar No. 10929400)
[e-mail]
Allen F. Gardner (Bar No. 24043679)
[e-mail]
POTTER MINTON
A Professional Corporation
110 N. College, Suite 500
Tyler, TX 75702
Telephone: [phone]
Facsimile: [phone]
ATTORNEYS FOR GOOGLE INC. AND
YOUTUBE LLC.

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CERTIFICATE OF SERVICE
The undersigned hereby certifies that all counsel of record who are deemed to have
consented to electronic service are being served with a copy of this document via the Court’s
CM/ECF system per Local Rule CV-5(a)(3) on August 11, 2011. Any other counsel of record
will be served by First Class U.S. mail on this same date.

/s/ Michael E. Jones

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