WI-LAN Inc. v. Alcatel-Lucent USA Inc. et al

Filing 324

SUR-REPLY to Reply to Response to Motion re 306 MOTION to Sever and Memorandum In Support filed by WI-LAN Inc.. (Attachments: # 1 Exhibit 1)(Weaver, David)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
TYLER DIVISION
WI-LAN INC.,

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Plaintiff,
v.
ALCATEL-LUCENT USA INC.; et al.
Defendants.

Civil Action No. 6:10-cv-521-LED
JURY TRIAL DEMANDED

WI-LAN’S SUR-REPLY OPPOSING HTC’S SECOND MOTION TO SEVER

Plaintiff Wi-LAN Inc. (“Wi-LAN”) submits this Sur-Reply in response to Defendant
HTC’s Reply In Support of HTC’s Motion to Sever (“Reply”) (Dkt No. 322). For the reasons
detailed below and in Wi-LAN’s Response Opposing HTC’s Second Motion to Sever (Dkt No.
319), Wi-LAN respectfully requests that the Court deny HTC’s Second Motion to Sever
(“Second Motion”) (Dkt. 306).

1.

HTC’s Reply Fails to Justify Severance.

As with HTC’s Second Motion itself, HTC’s Reply ignores the Court’s previous findings
regarding the overlap of evidence and common fact issues among the Defendants in its Order
denying HTC’s first motion for severance. HTC’s Reply also ignores the overlap of evidence
and common fact issues detailed in Wi-LAN’s Response. Instead, HTC essentially argues (1)
that it should be severed from Alcatel-Lucent and Ericsson because Wi-LAN asserts a different
patent against HTC and (2) that it should be severed from Sony Mobile because HTC’s date of

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the hypothetical negotiation for a reasonably royalty differs from that of Sony Mobile. (HTC
Reply at 2.) Neither argument is persuasive.

HTC’s first argument fails because it ignores the substantial overlap in the technology at
issue, the substantial overlap of the terms used in the claims, the interoperability of the base
stations and handsets (both as claimed and in fact), and the substantial overlap of evidence and
fact issues in the invalidity case and also in the infringement case resulting from all Defendants’
compliance with the 3GPP HSDPA standard. HTC also ignores the Defendants’ shared expert
on invalidity. Moreover, HTC’s first argument ignores the substantial overlap of evidence and
common fact issues it shares with Sony Mobile, which uses some of the same Qualcomm chips
as HTC. As noted in Wi-LAN’s Response, the In re EMC decision on which HTC relies
expressly

noted

that

this

fact

is

a

“pertinent

factual

consideration[]”

that can weigh against severance. 677 F.3d 1351, 1359 (Fed. Cir. 2012). And, as noted in WiLAN’s Response, HTC shares a single invalidity expert with all Defendants and also a damages
expert with Alcatel-Lucent. HTC fails to address this substantial overlap in its Reply.

HTC’s second argument fares no better. HTC ignores the extensive overlap of evidence
and common fact issues identified in the Court’s Order denying HTC’s First Motion and in WiLAN’s Response. HTC’s silence essentially concedes the substantial overlap of evidence and
fact issues with Sony Mobile on invalidity and infringement. Indeed, HTC points to only a few
evidentiary differences on damages issues between it and Sony Mobile. HTC Reply at 2. In
doing so, however, HTC fails to address the substantial evidentiary overlap resulting from
HTC’s sharing a damages expert with Alcatel-Lucent.

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2.

HTC Overstates Any Potential Prejudice to It.

HTC again asserts that it will somehow be prejudiced by a trial involving all four
Defendants. (HTC Reply at 4-5.) Nonetheless, HTC essentially concedes that none of the other
Defendants object to a single trial involving all parties, thus suggesting that they do not see any
prejudice from such a trial. HTC also fails to note that, because HTC shares both an invalidity
and a damages expert with other defendants, HTC and Wi-LAN will each have reduced expenses
by trying all parties together.

HTC argues that the admission of documents involving base stations would somehow be
prejudicial to it, but fails to explain how this is so. (HTC Reply at 4-5.) This argument seems
curious indeed, since Sony Mobile has not made any argument of the sort. Moreover, Wi-LAN
has dropped its claims of willful infringement against all Defendants, and HTC offers no
suggestion of any other “bad behavior” by another Defendant that might somehow result in
prejudice to HTC.

HTC concludes by arguing that “the Court would have to issue curative instructions to
the jury every time an Alcatel-Lucent, Ericsson, or Sony Mobile document is introduced at trial.”
(HTC Reply at 4.) HTC unsurprisingly fails to cite a single case holding that such an approach is
even desirable, let alone required as HTC asserts. HTC apparently believes that a trial involving
HTC and the other Defendants will be so unique and different from all other trials that it will
require a constant stream of curative instructions. While one or more curative instructions may
indeed be proper – and in fact, are included in the parties’ proposed jury instructions – HTC
offers absolutely no support for its dire prediction.

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3.

HTC’s Proposed Trial Plan Prejudices Wi-LAN.

HTC’s Reply attempts to support the Second Motion as a proposed trial plan. But as
detailed in Wi-LAN’s Response, HTC’s go-it-alone trial plan will result in prejudice to Wi-LAN,
additional expense for the parties, and require additional Court time, while also running the risk
of conflicting results.

As an initial matter, HTC’s Reply essentially ignores the prejudice to Wi-LAN from
HTC’s proposal. HTC acknowledges that its proposal would require Wi-LAN to try the validity
of the ‘211 patent twice. HTC Reply at 3. But HTC glosses over the substantial and unfair
prejudice to Wi-LAN of having to try this issue twice, as well as the waste of the Court’s
resources resulting from HTC’s proposal.

Moreover, HTC otherwise ignores the substantial overlap of evidence and fact issues
involving invalidity. Indeed, HTC asserts that the ‘211 patent is different from the other asserted
patents, HTC Reply at 1-2, suggesting that there is no such overlap of common facts and
evidence. HTC is wrong.

As noted in Wi-LAN’s Response, all of the Defendants share a single expert on
invalidity. Mr. Lanning’s expert report on invalidity devotes about 70 pages to a discussion of
the prior art relevant to both the ‘326 and ‘211 patents. This 70-page discussion lumps the ‘211
and ‘326 patents together. Indeed, Mr. Lanning asserts the exact same eleven primary references
against both the ‘211 and ‘326 patents and also the exact same ten combinations of references
against both the ‘211 and ‘326 patents. For ease of reference, only the table of contents from Mr.
Lanning’s report is submitted as Exhibit 1 hereto. Contrary to HTC’s suggestion, its own

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expert’s report shows a huge overlap of the invalidity issues and thus further demonstrates the
prejudice to Wi-LAN of two separate invalidity trials.

4.

Conclusion

For the reasons detailed in Wi-LAN’s Response, Wi-LAN’s proposed trial plan and its
alternative trial plan are much better alternatives than two trials on all issues, one of which would
involve just HTC. Wi-LAN respectfully requests that the Court deny HTC’s Second Motion to
Sever and proceed to try HTC together with the other Defendants.

Dated: February 25, 2013

Local Counsel
Johnny Ward (TX Bar No. 00794818)
Wesley Hill (TX Bar No. 24032294)
WARD & SMITH LAW FIRM
P.O. Box 1231
1127 Judson Rd., Ste. 220
Longview, TX 75606-1231
Tel: [phone]
Fax: [phone]
[e-mail]
[e-mail]

Respectfully submitted,

By: /s/ David B. Weaver
David B. Weaver (TX Bar No. 00798576)
Lead Attorney
Avelyn M. Ross (TX Bar No. 24027817)
Ajeet P. Pai (TX Bar No. 24060376)
Syed K. Fareed (TX Bar No. 24065216)
Jeffrey T. Han (TX Bar No. 24069870)
Seth A. Lindner (TX Bar No. 24078862)
Janice Ta (TX Bar No. 24075138)
VINSON & ELKINS LLP
2801 Via Fortuna, Suite 100
Austin, TX 78746
Tel: [phone]
Fax: [phone]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
Steven R. Borgman (TX Bar No. 02670300)
Gwendolyn J. Samora (TX Bar No. 00784899)
VINSON &ELKINS LLP
1001 Fannin Street, Suite 2500
Houston, TX 77002-6760
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Tel: [phone]
Fax: [phone]
[e-mail]
[e-mail]
Chuck P. Ebertin (CA Bar No. 161374)
VINSON & ELKINS LLP
525 University Avenue, Suite 410
Palo Alto, CA 94301-1918
Tel: [phone]
Fax: [phone]
[e-mail]
Constance S. Huttner (NY Bar No. 1722024)
VINSON & ELKINS LLP
666 5th Avenue, 26th Floor
New York, NY 10103-0040
Tel: [phone]
Fax: (9l7) 849-5339
[e-mail]
[e-mail]
Attorneys for Plaintiff, Wi-LAN Inc.

CERTIFICATE OF SERVICE
The undersigned certifies that the foregoing document was filed electronically in
compliance with Local Rule CV-5(a). As such, this document was served on all counsel who are
deemed to have consented to electronic service. Local Rule CV-5(a)(3)(A). Pursuant to Fed. R.
Civ. P. 5(d) and Local Rule CV-5(d) and (e), all other counsel of record not deemed to have
consented to electronic service were served with a true and correct copy of the foregoing by
email and/or fax, on this the 25th day of February, 2013.

/s/ David B. Weaver
David B. Weaver

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