Sound View Innovations, LLC v. Hulu, LLC

OPPOSITION re: NOTICE OF MOTION AND MOTION to Exclude IN PART THE TESTIMONY OF MICHAEL JEFFORDS 247 / Defendant's Opposition to Plaintiff's Daubert Motion to Exclude In-Part the Testimony of Mr. Michael Jeffords

C.D. Cal.March 18, 2019

TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BRETT J. WILLIAMSON (#145235) bwilliamson@omm.com JOHN C. KAPPOS (#171977) jkappos@omm.com CAMERON W. WESTIN (#290999) cwestin@omm.com BO K. MOON (#268481) bmoon@omm.com BRADLEY M. BERG (#300856) bmberg@omm.com O’MELVENY & MYERS LLP 610 Newport Center Drive, 17th Floor Newport Beach, CA 92660 Telephone: (949) 823-6900 Facsimile: (949) 823-6994 Attorneys for Defendant and Counter-Claimant HULU, LLC UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA SOUND VIEW INNOVATIONS, LLC,, Plaintiff, v. HULU, LLC, Defendant. Case No. 2:17-cv-04146-JAK-(PLAx) DEFENDANT’S OPPOSITION TO PLAINTIFF’S DAUBERT MOTION TO EXCLUDE IN- PART THE TESTIMONY OF MR. MICHAEL JEFFORDS HULU, LLC, Counter-Claimant, v. SOUND VIEW INNOVATIONS, LLC, Counter-Defendant. Hon. Judge John A. Kronstadt Date: April 15, 2019 Time: 8:30 a.m. Courtroom No.: 10B REDACTED VERSION OF DOCUMENT PROPOSED TO BE FILED UNDER SEAL Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 1 of 28 Page ID #:17524 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY TABLE OF CONTENTS Page - i - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. INTRODUCTION ........................................................................................... 3 II. LEGAL STANDARD ..................................................................................... 4 III. ARGUMENT .................................................................................................. 5 A. Mr. Jeffords’ Methodology for Calculating Damages Is Sound and Based on Relevant Evidence .......................................................... 5 1. Mr. Jeffords’ Opinions Regarding the ’062 Patent Are Fully Supported by the Underlying Evidence ............................ 7 2. Mr. Jeffords’ Opinions Regarding the CDN Patents Are Fully Supported by the Underlying Evidence ............................ 9 B. Sound View’s Motion Raises, At Most, Questions Going to the Weight of Mr. Jeffords’ Testimony, Not Its Admissibility ................ 12 1. Mr. Jeffords Relied On Sufficient Evidence that the Non- Infringing Alternative for the ’062 Patent Described by Dr. Crovella was Non-infringing, Available, and Acceptable ................................................................................ 13 2. Mr. Jeffords’ Opinions About Non-accused CDNs Are Firmly Based on Evidence in the Case ..................................... 14 3. Mr. Jeffords’ Opinions About Non-infringing Alternatives for the ’213 Patent Are Based On Competent Evidence .......... 16 4. Sound View Makes No Serious Attempt to Challenge Mr. Jeffords’ Remaining Opinions About the CDN Patents ........... 17 5. Mr. Jeffords’ Opinions Reflect What Hulu Would Have Paid Outside Consultants to Implement The Alternatives ....... 18 6. Mr. Jeffords Reasonably Relied on Information From Hulu’s Engineers About Hulu’s Technology ........................... 19 C. Sound View’s Remaining Cited Precedent is Inapposite ................... 21 D. Mr. Jeffords’ Testimony About the Lack of Benefits from the Patents Is Supported By the Technical Experts .................................. 22 E. Both Mr. Jeffords and Mr. Yurkerwich Provide Testimony Regarding Hulu’s Licensing History .................................................. 23 IV. CONCLUSION ............................................................................................. 25 Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 2 of 28 Page ID #:17525 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Cases Apple Inc. v. Motorola, Inc., 757 F.3d 1286 (Fed. Cir. 2014) ............................................................................. 5 Apple, Inc. v. Samsung Elecs. Co., 2014 WL 6687122 (N.D. Cal. Nov. 25, 2014) .................................................... 22 Aqua Shield v. Inter Pool Cover Team, 774 F.3d 766 (Fed. Cir. 2014) ............................................................................... 6 Bakst v. Cmty. Mem’l Health Sys., Inc., 2011 WL 13214315 (C.D. Cal. Mar. 7, 2011) .............................................. 18, 19 Barnes & Noble, Inc. v. LSI Corp., 2012 WL 1564734 (N.D. Cal. May 2, 2012). ..................................................... 24 C & F Packing Co. v. IBP, Inc., 224 F.3d 1296 (Fed. Cir. 2000) ........................................................................... 25 Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 U.S. 579 (1993) ............................................................................... 4 Enovsys LLC v. AT&T Mobility LLC, 2015 WL 10383057 (C.D. Cal. Aug. 10, 2015) .................................................... 5 Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197 (Fed. Cir. 2010) ..................................................................... 24, 25 Gen-Probe Inc. v. Becton Dickinson & Co., 2012 WL 9335913 (S.D. Cal. Nov. 26, 2012)..................................................... 24 Georgia-Pac. Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116 (S.D.N.Y. 1970) .................................................................... 23 Grain Processing Corp. v. Am. MaizeProds. Co., 185 F.3d 1341 (Fed. Cir. 1999) ........................................................................... 22 i4i Ltd. P’ship v. Microsoft Corp., 598 F.3d 831 (Fed. Cir. 2010), aff’d, 564 U.S. 91 (2011) ........................ 4, 13, 25 Kaneka Corp. v. SKC Kolon PI, Inc., 2017 WL 6343537 (C.D. Cal. Dec. 8, 2017)................................................. 21, 22 Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 3 of 28 Page ID #:17526 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 2 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 LaserDynamics, Inc. v. Quanta Computer, Inc., 2011 WL 197869 (E.D. Tex. Jan. 20, 2011) ....................................................... 22 Loeffel Steel Prod., Inc. v. Delta Brands, Inc., 387 F. Supp. 2d 794 (N.D. Ill. 2005) ................................................................... 20 Micro Chem., Inc. v. Lextron, Inc., 317 F.3d 1387 (Fed. Cir. 2003) ............................................................................. 4 NetAirus Techs., LLC v. Apple, Inc., 2013 WL 11237200 (C.D. Cal. Oct. 23, 2013) ..................................................... 5 Prism Techs. LLC v. Sprint Spectrum L.P., 849 F.3d 1360 (Fed. Cir. 2017) ....................................................................... 6, 19 Toyo Tire & Rubber Co. v. Doublestar Dong Feng Tyre Co., 2018 WL 3203421 (C.D. Cal. June 26, 2018) ..................................................... 21 Utah Med. Prod., Inc. v. Graphic Controls Corp., 350 F.3d 1376 (Fed. Cir. 2003) ........................................................................... 25 Waymo LLC v. Uber Techs., Inc., 2017 WL 5148390 (N.D. Cal. Nov. 6, 2017) ...................................................... 21 Wordtech Sys., Inc v. Integrated Networks Sols., Inc., 609 F.3d 1308 (Fed. Cir. 2010) ........................................................................... 25 Yodlee, Inc. v. Plaid Techs. Inc., 2017 WL 466358 (D. Del. Jan. 27, 2017) ..................................................... 20, 21 Rules Fed. R. Evid. 702 ........................................................................................................ 5 Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 4 of 28 Page ID #:17527 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. INTRODUCTION Sound View does not challenge the methodology adopted by Hulu’s damages expert, Mr. Jeffords. Nor does it assert that the evidence he relies upon in this methodology is unrelated to the case. Indeed, it cannot do so. Instead, Sound View raises largely baseless and unsupported disputes about the weight the Court should assign to various pieces of evidence. Sound View’s attempt to exclude Mr. Jeffords’ opinions as to a reasonable royalty in this case by nit-picking at the underlying evidence goes against a wealth of precedent in the damages field. Mr. Jeffords provides opinions on the royalties that the parties would have arrived at during hypothetical negotiations for each of the four patents-in-suit by considering, among other things, the cost to Hulu to design around Sound View’s patents at the time of the hypothetical negotiations. Mr. Jeffords does not make these calculations in a vacuum. He relies on technical guidance from Hulu’s two retained technical experts, each Professors of Computer Science with at least 25 years of experience in the field, and each well studied in the accused technology and Sound View’s allegations of infringement. Mr. Jeffords also relies on information provided by Hulu’s engineers that are responsible for this technology— the same engineers upon which Sound View’s own technical and damages experts base their opinions. Relying upon Dr. Chase and Dr. Crovella’s expertise and Mr. Darnault and Mr. Rangel’s experience, Mr. Jeffords applies a methodology repeatedly endorsed by the Federal Circuit to reach his opinions. Mr. Jeffords similarly relies on Dr. Chase and Dr. Crovella’s expertise to opine on the lack of benefits provided by the patents. Sound View’s contention that these statements are not supported by these experts’ reports is simply wrong. Finally, Mr. Jeffords’ opinions about Hulu’s licenses largely mirrors a nearly identical analysis by Sound View’s own damages expert, but reaches a different conclusion that Sound View now seeks to exclude. None of the challenges in Sound View’s motions go to Mr. Jeffords’ methodology. They are simply Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 5 of 28 Page ID #:17528 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 4 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 criticisms that Sound View may raise upon cross-examination should it truly believe it has any basis to do so. II. LEGAL STANDARD Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 U.S. 579 (1993) requires that courts ensure expert testimony to be presented at trial is both “relevant” and “reliable.” Id. at 589. Daubert and Fed. R. Evid. 702 task district courts with ensuring the jury is protected with “safeguards against unreliable or irrelevant opinions,” but they do not require the district court to issue “guarantees of correctness.” i4i Ltd. P’ship v. Microsoft Corp., 598 F.3d 831, 854 (Fed. Cir. 2010), aff’d, 564 U.S. 91 (2011). To the contrary, “the trial court’s role as gatekeeper is not intended to serve as a replacement for the adversary system.” Micro Chem., Inc. v. Lextron, Inc., 317 F.3d 1387, 1392 (Fed. Cir. 2003) (citing Advisory committee note to Rule 702). At trial, “[v]igorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence.” Daubert, 509 U.S. at 596. Thus, “[w]hen the methodology is sound, and the evidence relied upon sufficiently related to the case at hand, disputes about the degree of relevance or accuracy (above this minimum threshold) may go to the testimony’s weight, but not its admissibility.” i4i Ltd., 598 F.3d at 852 (internal citations omitted) (emphasis added). As another court in this District has explained, the “gatekeeper” role can be particularly important in the context of damages experts to exclude unreliable principles and methods, but should not attempt to weigh the facts upon which it is based or attempt to replace an expert’s methodology with the Court’s own: ‘[A] judge must be cautious not to overstep its gatekeeping role and weigh facts, evaluate the correctness of conclusions, impose its own preferred methodology, or judge credibility, including the credibility of one expert over another. These tasks are solely reserved for the fact finder.’ The limitation of the trial court’s gatekeeping role ‘to excluding testimony based on unreliable principles and methods is Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 6 of 28 Page ID #:17529 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 5 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 particularly essential in the context of patent damages’ because ‘questions regarding which facts are most relevant or reliable to calculating a reasonable royalty are for the jury.’ Enovsys LLC v. AT&T Mobility LLC, 2015 WL 10383057, at *3 (C.D. Cal. Aug. 10, 2015) (quoting Apple Inc. v. Motorola, Inc., 757 F.3d 1286, 1314-15 (Fed. Cir. 2014)). Thus, in Enovsys, the court excluded “a methodological error that the Court must address due to the Court’s gatekeeper role.” Id. By contrast, in NetAirus Techs., LLC v. Apple, Inc., 2013 WL 11237200 (C.D. Cal. Oct. 23, 2013), the Court declined to exclude testimony from the plaintiff’s damages expert that relied on an opinion provided by its technical expert—that “the transmission power limitations are always met by iPhone 4 users.” Id. at *2. The Court concluded that the damages expert’s choice to rely on the technical expert’s testimony “does not affect the admissibility of his opinions,” as ultimately the validity of the underlying opinion would “stand or fall with the jury’s determination of the parties’ competing positions.” Id. (emphasis added). In reaching this conclusion, the Court noted germane comments from the Federal Rules’ Advisory Committee on Rule 702: When facts are in dispute, experts sometimes reach different conclusions based on competing versions of the facts. The emphasis in the amendment on ‘sufficient facts or data’ is not intended to authorize a trial court to exclude an expert’s testimony on the ground that the court believes one version of the facts and not the other. Id. (quoting Fed. R. Evid. 702 Advisory Committee’s Note (2000 Amendment)).1 III. ARGUMENT A. Mr. Jeffords’ Methodology for Calculating Damages Is Sound and Based on Relevant Evidence Mr. Jeffords’ methodology for calculating damages—based in part upon the 1 The Court did exclude several other opinions of the same expert based on his use of flawed methodology, rather than disputes as to underlying facts. Id. at *2-8. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 7 of 28 Page ID #:17530 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 6 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 costs to implement non-infringing alternatives to the patents-in-suit at the time of the hypothetical negotiations—has been repeatedly affirmed by the Federal Circuit. The “price for a hypothetical license may appropriately be based on consideration of the ‘costs and availability of non-infringing alternatives.’” Prism Techs. LLC v. Sprint Spectrum L.P., 849 F.3d 1360, 1376 (Fed. Cir. 2017) (quoting Aqua Shield v. Inter Pool Cover Team, 774 F.3d 766, 770 (Fed. Cir. 2014)). In Prism Techs., the Federal Circuit affirmed a similar approach to that taken by Mr. Jeffords here. In the district court, the jury awarded damages based on the plaintiff’s damages expert’s opinion, which “valu[ed] the patented technology . . . [by] show[ing] that the defendant’s infringement allowed it to avoid taking a different, more costly course of action.” Id. at 1375-76. The plaintiff’s technical expert had “relied on his decades of experience” to opine that, in a hypothetical negotiation, the defendant “would have attempted to design around the patented invention by building its own private backhaul network.” Id. at 1376. Again relying on his decades of experience, the technical expert was able to estimate the defendant’s “cost savings” based on not needing to do that design around. Id. The technical expert’s opinion was also supported by testimony from the defendant’s own witnesses. Id. The plaintiff’s damages expert thus relied on “sufficient evidence” supporting his opinions as to the defendant’s cost savings as a result of the alleged infringement, and the jury could appropriately reasonably rest its damages determination on those opinions and evidence. Id. at 1376-77. Here, Mr. Jeffords assumed that the asserted patents were valid and infringed, and reached his opinions as to the outcome of the hypothetical negotiations based, in part, on the costs that Hulu would have faced at that time to design around the alleged infringement or switch to a non-accused CDN. Mr. Jeffords’ opinion relied on the studied opinions of two highly qualified technical witnesses, who explained that these design-around options were non-infringing, available, and acceptable, and discussions with two Hulu engineers responsible for Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 8 of 28 Page ID #:17531 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 7 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the relevant accused technologies, who confirmed those technical experts’ opinions. Mr. Jeffords’ methodology is sound and fully supported by relevant evidence, and Sound View’s attempts to criticize that evidence go, at most, to the weight to be afforded to Mr. Jeffords’ opinions, not their admissibility. 1. Mr. Jeffords’ Opinions Regarding the ’062 Patent Are Fully Supported by the Underlying Evidence Mr. Jeffords’ opinions regarding the cost of designing-around the ’062 Patent are based on his discussions with Dr. Mark Crovella, a technical expert retained by Hulu in this case, and Mr. Andres Rangel, Hulu’s Director of Software Development and its designated Rule 30(b)(6) witness on topics related to the accused technology for the ’062 Patent. Dkt. No. 249-3 at 10. Dr. Crovella is the Chair of the Computer Science Department at Boston University. He obtained his Ph.D. in Computer Science in 1994, and has worked in the area of computer science for over 34 years. Westin Decl., Ex. 22 at Appendix A.2 He is on the Scientific Advisory Board of the Max Plank institute for Software Systems, a named inventor on nine U.S. patents, and the author of a book on internet infrastructure, traffic, and applications. Id. Mr. Rangel is Hulu’s Director of Software Development. He obtained degrees in Electrical Engineering and Computer Engineering in 2003 and 2004, while also running his own company developing electronic voting devices. Westin Decl., Ex. 23 at 34:24-36:1. Mr. Rangel worked as a software engineer at multiple companies for almost a decade before joining Hulu as a Senior Software Developer in March of 2012. Id. at 35:23-37:5. From March 2012 through today, Mr. Rangel worked on numerous software projects at Hulu. In March of 2018, Hulu promoted Mr. Rangel from Senior Software Developer to Senior Software Development Lead 2 All citations to “Westin Decl., Ex. __” refer to exhibits to the Omnibus Declaration of Cameron W. Westin In Support of Defendant Hulu, LLC’s Oppositions to Sound View’s Motions for Summary Judgment and Motions to Exclude (filed concurrently herewith). Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 9 of 28 Page ID #:17532 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 8 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 to Principal Software Lead to Principal Manager, and eventually to Director of Software Development. Id. at 36:23-40:19. Mr. Jeffords’ calculated the amount of the reasonable royalty for the ’062 Patent based on Dr. Crovella’s development of a program that, under Sound View’s theory of infringement for the ’062 Patent, would avoid any infringement by Hulu’s software. Sound View alleges that Hulu’s use of “chained” jQuery methods infringes Claim 14’s requirement of “combining at least two of said software operators to create an application.” Dkt. No. 249-3 at 8; 247-5 at 41. Although Hulu denies that its existing method is infringing, Dr. Crovella explains that there “is a simple, general way to replace ANY jQuery chain” through a simple rewrite of the code. Dkt. No. 247-5 at 41-42. Hulu can perform this transformation on all of Hulu’s accused source code “by a single small program” that Dr. Crovella wrote in 7.5 hours, and appended to his expert report. Id. at 42-43. Dr. Crovella, a Professor of Computer Science, opined that this program could have been “created in a short time by a typical software engineer with a few years of post- undergraduate programming experience.” Id. at 43. Mr. Rangel discussed this program with Dr. Crovella, and confirmed that this non-infringing alternative “would not affect the operation of the accused Hulu web applications” and that Hulu “would have been able to perform such conversions in July 2010.” Id.3 Mr. Jeffords relied on Dr. Crovella and Mr. Rangel’s confirmation that this non-infringing alternative would have been readily available to Hulu at the time of the hypothetical negotiation, and would be acceptable to Hulu. Dkt. No. 249-3 at 10. Accordingly, the total resources required to design-around Claim 14 of the ’062 Patent, including implementation and testing on Hulu’s source code that uses jQuery, would require no more than 80 hours from a single engineer. Id. at 9. Mr. Jeffords then reasonably and conservatively based his estimate on Dr. Crovella’s 3 Dr. Crovella also described several other non-infringing alternatives to the ’062 Patent. Id. at 46-49. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 10 of 28 Page ID #:17533 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 9 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 hourly rate at the time of the hypothetical negotiation, to estimate that the total cost to Hulu of implementing this non-infringing alternative would have been no more than $50,000. Id. 2. Mr. Jeffords’ Opinions Regarding the CDN Patents Are Fully Supported by the Underlying Evidence Mr. Jeffords’ based his opinions regarding the cost of designing around the three CDN Patents (the ’213, ’796, and ’074 Patents) in part on his discussions with two technical witnesses: Dr. Jeffrey Chase, one of Hulu’s technical expert in this case, and Mr. Bertrand Darnault, Hulu’s former Principal Engineering Lead and its designated Rule 30(b)(6) witness on topics related to the accused technology for the CDN Patents. Dkt. No. 249-3 at 10. Dr. Chase obtained his Ph.D. in Computer Science in 1995, and has been a professor of Computer Science at Duke University since that year. Westin Decl., Ex. 20 ¶ 12. Dr. Chase has over 35 years of experience working in the software development and computer science fields, both in the industry and academia. Id. ¶ 8. Among other relevant experience, Dr. Chase has been involved in implementing the TCP protocol on network devices since 1985, id. ¶ 9, and has collaborated with engineers at AT&T working on proxy servers (the purported “helper servers” accused of infringement here) during the same timeframe when the CDN Patents were filed. Id. ¶ 14. Mr. Darnault obtained a Master’s Degree in Computer Science and began working as a network and systems engineer in 2011. Westin Decl., Ex. 24 at 14:21- 17:6. He joined Hulu as a Senior Engineering Lead in 2014, and was promoted to Principal Engineering Lead in January 2017. Id. at 17:10-19:7. His work at Hulu includes “technology related to [Hulu’s] SVOD [and] Live TV products,” including “video, ingest, encoding, packaging and delivery.” Id. at 19:22-25. Mr. Jeffords based his opinions regarding the CDN Patents, in part, on Dr. Chase’s explanation of several ways Hulu could have designed around the asserted Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 11 of 28 Page ID #:17534 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 10 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 claims of the CDN Patents at the time of the respective hypothetical negotiations. Mr. Darnault confirmed those alternatives were available and acceptable to Hulu at the time of the respective hypothetical negotiations. They included: Non-Accused CDNs: Sound View has only accused two utilized by Hulu. Dr. Chase and Mr. Darnault both confirmed that and that this non-infringing alternative would have been acceptable and available to Hulu at the time of the hypothetical negotiation. Dkt. No. 249-3 at 11; 249-4 at 23-24. Mr. Jeffords then reasonably and conservatively based his estimate on Dr. Chase’s hourly rate at the time of the hypothetical negotiation, estimating that the total cost of would have been no more than $110,000. Dkt. No. 249-3 at 11. Different Representations at Different Edge Servers: Dr. Chase also informed Mr. Jeffords that Hulu could have designed around Claims 1, 7, 8, and 16 of the ’213 Patent by reconfiguring its “manifest generation service” to request different bit rate representations from different edge servers of a CDN. Dkt. No. 249-3 at 11, 13. As Dr. Chase explained in his own report, the edge servers would not “adjust a data transfer rate” in the manner alleged to infringe by Sound View. Dkt. No. 249-4 at 25-27. Mr. Darnault confirmed that a single engineer could have performed this reconfiguration of the manifests in one to two weeks, plus another one to two weeks for testing. Id. at 27. Dr. Chase also explained (and Mr. Darnault confirmed) that this alternative would have been available to Hulu at the time of the hypothetical negotiations, and was unlikely to affect user experience. Id. Mr. Jeffords again based his estimate for the cost of this work on Dr. Chase’s hourly rate at the time of the hypothetical negotiation, and estimated that the total cost of this alternative would have been no more than $80,000. Dkt. No. 249-3 at 12. Multiple Origin Servers: Dr. Chase informed Mr. Jeffords that Hulu could design around claims 1, 7, and 8 of the ’213 Patent by hosting segments of each Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 12 of 28 Page ID #:17535 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 11 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 streaming media object in separate origin servers. Dkt. No. 249-3 at 12. Dr. Chase explained in his own report that this change would mean that no streaming media “is distributed from a single content server as the Asserted Claims require.” Dkt. No. 249-4 at 25. Dr. Chase explained why “[s]uch a change would be relatively simple to implement” in the accused products, and Mr. Darnault confirmed that this change could have been performed by “a single engineer working a total of 2-4 weeks to fully implement and test” at the time of the hypothetical negotiation. Id. Mr. Jeffords again based his estimate for the total cost of this work on Dr. Chase’s hourly rate at the time of the hypothetical negotiation, estimating that the total cost of this alternative would have been no more than $80,000. Dkt. No. 249-3 at 12. Multiple Origin Servers Also a Non-infringing Alternative for the ’796 and ’074 Patents: Dr. Chase also informed Mr. Jeffords that hosting segments of each streaming media object in separate origin servers would also be an acceptable and readily available non-infringing alternative for the claims of the ’796 and ’074 Patents at the time of the respective hypothetical negotiations for those patents. Id. at 13-14. Dr. Chase explained why this alternative would not infringe the asserted claims of the ’796 and ’074 Patents. Dkt. No. 249-4 at 29-30. Mr. Darnault confirmed Dr. Chase’s opinion that these alternatives could have been implemented in the same amount of time, and would not have impacted quality of service for Hulu’s customers. Dkt. No. 249-3 at 13-14. Lowest Resolution Iteration: Dr. Chase also informed Mr. Jeffords that Hulu could have designed around the claims of the ’796 Patent by modifying its “manifest generation service” to only account for the lowest resolution iteration of the first segment of a streaming media object. In his own report, Dr. Chase explains why this modification would make Hulu’s Live streaming service non- infringing, even under Sound View’s interpretation of the ’796 Patent. Dkt. No. 249-4 at 28-29. Mr. Darnault confirmed Dr. Chase’s opinion that this change “could have been implemented by simply generating a manifest that lists the first Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 13 of 28 Page ID #:17536 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 12 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 segment only in low resolution,” that such a change could have been fully implemented by a Hulu engineer within four weeks, and that this change would be imperceptible to Hulu clients. Id. at 29. Mr. Jeffords again based his estimate for the cost of this work on Dr. Chase’s hourly rate, estimating that the total cost of implementing it would have been no more than $110,000. Dkt. No. 249-3 at 13. Marking Segments Uncacheable: Dr. Chase also informed Mr. Jeffords that Hulu could have designed around the claims of the ’074 Patent by “marking at least one segment of each [streaming media object] as uncacheable.” Id. at 14. In his own report, Dr. Chase explains why this modification would have made Hulu’s SVOD and Live streaming services non-infringing because “the requirement for ‘storing said SM object’ would not be met,” even under Sound View’s interpretation of the ’074 Patent. Dkt. No. 249-4 at 30. Mr. Darnault confirmed Dr. Chase’s opinion that this change “could be easily implemented in at least two ways,” through a change either at Hulu’s origin server or its manifest generation services. Id. Mr. Darnault also confirmed Dr. Chase’s opinion that a Hulu engineer could have fully implemented this change within four weeks, and that any change would be imperceptible to Hulu clients. Id. Mr. Jeffords again based his estimate for the total cost on Dr. Chase’s hourly rate at the time the work would have been done. He opined that the total cost of implementing this alternative would have been no more than $110,000. Dkt. No. 249-3 at 14. B. Sound View’s Motion Raises, At Most, Questions Going to the Weight of Mr. Jeffords’ Testimony, Not Its Admissibility Sound View does not challenge Mr. Jeffords’ selected methodology for calculating the costs to Hulu of designing-around the asserted claims. Nor does it seriously raise any questions about the underlying evidence. Instead, Sound View either misstates Mr. Jeffords’ reliance on the information provided by the experts and Hulu engineers as “assumptions,” ignores the evidence he does rely upon, or quibbles with the information these experts and engineers provided to Mr. Jeffords. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 14 of 28 Page ID #:17537 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 13 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 These (largely baseless) disputes go, at most, “to the testimony’s weight, but not its admissibility.” i4i Ltd., 598 F.3d at 852. 1. Mr. Jeffords Relied On Sufficient Evidence that the Non- Infringing Alternative for the ’062 Patent Described by Dr. Crovella was Non-infringing, Available, and Acceptable First, Sound View incorrectly contends that Dr. Crovella “provides no opinion as to whether any of the NIAs [for the ’062 Patent] were actually non- infringing.” Dkt. No. 249-2 at 6-7. This is simply false. Dr. Crovella explained his opinion that, even under Sound View’s interpretation of the claims and accused technology, removing Hulu’s use of “chained” jQuery methods would mean that the accused products do not meet Claim 14’s requirement of “combining at least two of said software operators to create an application.” Dkt. No. 247-5 at 41. Dr. Crovella confirmed this in his deposition, testifying that even when “analyzing this under [Sound View’s position] the infringement is due to chaining,” de-chaining the software would make it non-infringing. Dkt. No. 247-7 at 172:3-12. Second, Sound View baselessly asserts that Mr. Jeffords and Dr. Crovella “parrot the lay opinion” of Mr. Rangel that the non-infringing alternatives for the ’062 Patent were available and acceptable to Hulu at the time of the hypothetical negotiation. Dkt. 249-2 at 7. This too is simply untrue. Dr. Crovella provided his own expert opinions as to availability and acceptability of this non-infringing alternative. He testified in his deposition that there would be “no functional difference” between the chained and de-chained code. Dkt. No. 247-7 at 172:11- 12. He in fact confirmed this by running the actual program he developed against the source code accused of infringement in this case. Dkt. No. 247-5 at 43. And in his report, he relied on his 35 years in the industry (including over 20 years as a professor of computer science) to form two opinions: first, that “[s]uch a conversion program can be created in a short time by a typical software engineer with a few years of post-undergraduate programming experience”; and second, that “a Hulu engineer would have been able to write a conversion program, review the Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 15 of 28 Page ID #:17538 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 14 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 resulting code to correct any error, and test the code within a few days.” Id. at 43. Third, Mr. Rangel provided further corroboration that this “simple” software program would have been available and acceptable to Hulu at the time of the hypothetical negotiation in July 2010. Sound View’s only criticism of that evidence is that Mr. Rangel did not join Hulu until 2012, and had not reviewed the ’062 Patent’s claims at the time of his deposition. Dkt. No. 249-2 at 7-8. This does nothing to impugn Mr. Jeffords’ reliance on his discussions with Mr. Rangel. By the July 2010 hypothetical negotiation date, Mr. Rangel had already been working as a software engineer for over eight years. Westin Decl., Ex. 23 at 34:24- 36:1. Moreover, Sound View’s damages expert, Mr. Yurkerwich, bases much of his own opinion on Mr. Rangel’s testimony about the use of jQuery since 2010. See, e.g., Westin Decl., Ex. 25 at ¶ 210 (citing Mr. Rangel’s deposition testimony as the basis for his opinion that . This double standard demonstrates that Sound View objects merely to evidence it wants to dispute, not Mr. Jeffords’ methodology. Finally, Sound View’s contention that Mr. Rangel “testified that he had never read the patents and had no opinions about them” is inapposite. Dkt. 249-2 at 8. Dr. Crovella, not Mr. Rangel, provided evidence that the alternatives he described to both Mr. Jeffords and Mr. Rangel were non-infringing. Mr. Rangel had no reason to analyze the patents or Sound View’s allegations. 2. Mr. Jeffords’ Opinions About Non-accused CDNs Are Firmly Based on Evidence in the Case Mr. Jeffords’ opinions about the existence and availability of non-accused CDNs are firmly based on the evidence in this case. Sound View incorrectly asserts that Mr. Jeffords “assumes” that Hulu could have switched to CDNs that Sound View has not accused of infringement in this case. Mr. Jeffords did no such thing. Dr. Chase informed Mr. Jeffords that “Hulu would be able to switch to a non- accused CDN ” Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 16 of 28 Page ID #:17539 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 15 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dkt. No. 249-3 at 10. Mr. Darnault confirmed that “changing CDN providers is a relatively simple matter,” and that Id. Mr. Darnault also explained the “onboarding” process for utilizing a new CDN. Id. at 11. Mr. Jeffords’ report cited documents describing Id. at 13 n.152. Sound View’s motion concedes that Dkt. 249-2 at 9. Sound View also incorrectly asserts that Mr. Jeffords “assumes” that each of these CDNs “would be commercially acceptable and was available at the time of the [respective] hypothetical negotiations.” Dkt. 249-2 at 9. Once again, Sound View’s motion concedes that Id. Moreover, both Dr. Chase and Mr. Darnault confirmed that “such a change would have been available to Hulu in July 2010, and that switching to one of the non-accused CDNs would have been technically feasible and with appropriate testing would not adversely impact the quality of service of Hulu’s products.” Id. Mr. Darnault also confirmed the deposition testimony and thus there would be no commercial impact on Hulu. Id.4 Sound View’s criticism of Mr. Jeffords’ opinions rest on its own speculation as to whether a single CDN “could simply take over Hulu’s service (during any time period) and provide acceptable performance.” Dkt. 249-2 at 9. Mr. Jeffords never offers any such opinion. Instead, he relied on both Mr. Darnault’s experience 4 Sound View incorrectly asserts that Mr. Jeffords relies on testimony “out of context.” Dkt. 249-2 at 9. Sound View gives no explanation why it believes Mr. Jeffords takes this testimony out of context. More importantly, Mr. Jeffords relied on Mr. Darnault’s confirmation that See, e.g., Westin Decl., Ex. 24 at 205:16-25. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 17 of 28 Page ID #:17540 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 16 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 and Dr. Chase’s expert testimony, as well as that of Sound View’s expert Dr. Richardson, that . Dkt. No. 249-3 at 10 (quoting Dr. Richardson’s Expert Report). Sound View also argues that Mr. Jeffords should have performed some “analysis” or “research” to Dkt. 249-2 at 9. Mr. Jeffords, however, relied on information provided by Mr. Darnault. Sound View’s baseless attempt to discredit Mr. Darnault echoes its unavailing criticisms of Mr. Rangel. As Hulu’s Principal Engineering Lead responsible for the accused streaming services delivery over these CDNs, Mr. Darnault is undoubtedly qualified to provide testimony about Hulu’s use of its CDNs. As he did with Mr. Rangel’s testimony, Sound View’s own damages witness relies upon Mr. Darnault’s understanding of Hulu’s pre-2014 streaming services in his opinions. See, e.g., Westin Decl., Ex. 25 at ¶ 240 (“Mr. Darnault testified ’”). Like Mr. Rangel, Mr. Darnault did not provide any opinion on whether Hulu’s technology infringes the patents, but merely confirmed Dr. Chase’s view that these alternate CDNs were available and acceptable to Hulu. 3. Mr. Jeffords’ Opinions About Non-infringing Alternatives for the ’213 Patent Are Based On Competent Evidence Sound View’s motion concedes that Mr. Jeffords’ opinions about non- infringing alternatives for Claim 16 of the ’213 Patent are based on information from Dr. Chase and Mr. Darnault. Dkt. 249-2 at 10-11. Indeed, its only basis for disputing these opinions is to incorrectly argue that Dr. Chase “admit[ed] that the NIA would require coordination with the CDN providers.” Id. at 10. Dr. Chase did no such thing. Dr. Chase explained in his own report that Hulu could implement the non-infringing alternative to the ’213 Patent by modifying Hulu’s manifest file generation programs, “with no impact on the edge servers.” Dkt. No. 249-4 at 27. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 18 of 28 Page ID #:17541 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 17 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dr. Chase notes that Mr. Darnault (whose information Sound View otherwise dismisses out of hand) stated that this change “could require some coordination with the CDN providers to ensure that the edge server sets selected for each encoding (shard) are disjoint.” Id. Mr. Darnault nonetheless agreed with Dr. Chase that “a single engineer working for a week or two to modify [Hulu’s manifest generation] code would be able to accomplish this alternative.” Id. 4. Sound View Makes No Serious Attempt to Challenge Mr. Jeffords’ Remaining Opinions About the CDN Patents For all of Mr. Jeffords’ remaining opinions on non-infringing alternatives, Sound View provides only cursory criticisms of the underlying evidence, and no criticisms of Mr. Jeffords’ methodology. Sound View mischaracterizes Dr. Chase’s opinions about the availability of certain non-infringing alternatives, contending that “Dr. Chase does not opine” that the multiple origin server non-infringing alternative for the ’796 and ’074 Patents “was available at any point,” and that Dr. Chase “provides no opinion” that the non- infringing alternative for the ’074 Patent was available. Dkt. No. 294-2 at 11. Sound View also concedes that Mr. Jeffords relied on both Dr. Chase and Mr. Darnault for his opinions regarding the ’796 Patent, yet claims he is merely “parroting Mr. Darnault’s lay opinions.” Id. None of these assertions is correct and they do not concern any aspect of Mr. Jeffords’ methodology. Mr. Jeffords’ report explicitly states, “Dr. Chase explained that each of these options would have been readily available at that time.” Dkt. No. 249-3 at 13, 14. Sound View’s assertion to the contrary thus rests not on Mr. Jeffords’ opinions, but on its reading of Dr. Chase’s expert report. Moreover, the hypothetical negotiation dates for the ’074 and ’796 Patents are October of 2016 and May of 2017, respectively. Id. Mr. Darnault, who Hulu employed as its Senior Engineering Lead and Principal Engineering Lead at those times, respectively, confirmed these alternatives were both available to Hulu and would have had no Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 19 of 28 Page ID #:17542 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 18 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 impact on quality. Id. Far from “parroting Mr. Darnault’s lay opinions,” Dr. Chase’s own opinions on availability and acceptability to Hulu were confirmed by Mr. Darnault, the individual who is most likely the single most knowledgeable person on the availability of these non-infringing alternatives to Hulu. Mr. Jeffords reasonably relied on this evidence in forming his own opinions. 5. Mr. Jeffords’ Opinions Reflect What Hulu Would Have Paid Outside Consultants to Implement The Alternatives Dr. Chase, Dr. Crovella, and Hulu’s engineers all confirmed to Mr. Jeffords that a single employee could have implemented these non-infringing alternatives. Mr. Jeffords made the conservative assumption that Hulu would not pay its employees (or any other consultant hired to perform this work) more than Dr. Chase or Dr. Crovella, who were both at the relevant times tenured professors of computer science with over 25 years of relevant experience. In addition to being both reasonable and conservative, this approach avoids any question as to whether Hulu would have the available staffing to commit to these changes. Sound View disparages Mr. Jeffords’ use of these data points as an “unsupported guess.” Dkt. No. 249-2 at 12. It is not. Sound View does not dispute that these were the rates Dr. Chase and Dr. Crovella, like others with their qualifications, charged for their consulting services at the time of the respective hypothetical negotiations. Sound View does not dispute that relying on these experts’ hourly rates was a conservative and reasonable methodology. Sound View offers no dispute to the premise of Mr. Jeffords’ opinion that “Hulu would pay its [programming and video] engineers no more than the hourly amount” these experts received at the time. See Dkt. No. 249-3 at 9 n.133, 11 n.143, 12 n.146, 14 n.154. Instead, Sound View bases its request to exclude Mr. Jeffords’ opinions on a single inapposite case. In Bakst v. Cmty. Mem’l Health Sys., Inc., 2011 WL 13214315 (C.D. Cal. Mar. 7, 2011), the Court had previously ruled on summary judgment that the plaintiff’s damages were limited “to those flowing from positions Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 20 of 28 Page ID #:17543 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 19 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 for which [the plaintiff] applied during and after 2007.” Id. at *19. The opinion of plaintiff’s damages expert, however, was “based on an assumption that [plaintiff] would obtain employment as a hospital CEO,” despite there being no evidence he had applied for such a job. Id. Thus, the expert’s damages calculation was outside the scope of damages the Court delineated in its previous order and “based on factual assumptions that are entirely unsupported in the record.” Id. Mr. Jeffords did not speculate as to the rates Dr. Chase and Dr. Crovella charged for their consulting services at the time of the respective hypothetical negotiations. Nor did he speculate that this would have been an expensive option for Hulu to implement these design-around alternatives, compared to the relevant portion of the annual salaries of Hulu’s employees. Mr. Jeffords used conservative data points for the cost of a certified expert to implement the non-infringing alternatives in the time that both its technical experts and Hulu engineers confirmed would be required. His approach to calculating the “price for a hypothetical license . . . based on consideration of the ‘costs and availability of non-infringing alternatives’” is a time-tested methodology endorsed by the Federal Circuit and not seriously challenged here. Prism Techs., 849 F.3d at 1376. 6. Mr. Jeffords Reasonably Relied on Information From Hulu’s Engineers About Hulu’s Technology Sound View’s final criticism of Mr. Jeffords’ opinions on non-infringing alternatives is quintessential nitpicking over facts that it should instead attempt to rebut, if it can, on cross-examination. Sound View contends that Mr. Jeffords “acts as an impermissible mouthpiece” and “parrots Hulu’s engineers’ opinions” about the time required to implement the non-infringing alternatives. Dkt. 249-2 at 13. Sound View does not identify any reasons why the information Mr. Darnault and Mr. Rangel provided to Mr. Jeffords should be considered unreliable or irrelevant. Nor does Sound View dispute that Mr. Darnault and Mr. Rangel are indeed knowledgeable about Hulu’s process for making changes to the accused Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 21 of 28 Page ID #:17544 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 20 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 technology, as both were designated Rule 30(b)(6) witnesses on these technologies and testified about them at length in their depositions. As Dr. Chase and Dr. Crovella explained in detail in their reports, Mr. Rangel and Mr. Darnault provided detailed explanations about the efforts required to implement these non-infringing alternatives, including rewriting source code and testing the alternatives (consistent with Hulu’s regular practice) to ensure their reliability. Moreover, Sound View fails to address the fact that Mr. Darnault and Mr. Rangel were largely confirming the opinions of Hulu’s qualified technical experts, Dr. Chase and Dr. Crovella. Sound View attempts to mischaracterize Hulu’s engineers as providing expert testimony, which Mr. Jeffords adopts. They are not, and Mr. Jeffords’ opinions are very different from those in the precedent Sound View relies upon. For example, in Loeffel Steel Prod., Inc. v. Delta Brands, Inc., 387 F. Supp. 2d 794 (N.D. Ill. 2005), “[l]iterally every facet” of the plaintiff’s damages expert’s theory on “economic loss,” as well as “every bit of information regarding alleviation of the Line’s problems” came directly “from the defendants’ employees.” Id. at 798 n.1. The damages expert’s opinion on the plaintiff’s lost profits relied solely on adopting the opinions of the defendant’s employees. Id. at 799. These employees were not merely discussing aspects of their jobs—they instead “provided him with the very theory on which he relied and which admittedly was ‘beyond his ken.’” Id. at 824. In other words, “they were the experts, not he.” Id.5 In Yodlee, Inc. v. Plaid Techs. Inc., 2017 WL 466358 (D. Del. Jan. 27, 2017), the Court merely noted that it would be inappropriate for the damages expert to “rely on statements from [plaintiff’s] employees if those individuals are not subject to deposition by [defendant] and cannot be called as witnesses at trial (because, for example, they were not identified in [plaintiff’s] Rule 26 disclosures).” Id. at *2. 5 The Court noted that “[o]f course, it is common in technical fields for an expert to base an opinion in part on what a different expert believes on the basis of expert knowledge not possessed by the first expert.” Id. at 825. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 22 of 28 Page ID #:17545 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 21 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 The “more” that Sound View misleadingly quotes in its motion referred to numbers regarding apportionment that, in defendant’s characterization, he had “picked . . . out of a hat,” not obtained from plaintiff’s employees. Id. The damages expert was required to “do more to explain how he arrived at the numbers to which he intends to testify at trial,” something Mr. Jeffords does throughout his report. Id. Finally, this is certainly not a case like Waymo LLC v. Uber Techs., Inc., 2017 WL 5148390 (N.D. Cal. Nov. 6, 2017), where the plaintiff’s damages expert in a trade secret case was excluded because he was “not an economist but merely an inactive CPA and inactive lawyer,” and brought “no specialized knowledge to the table.” Id. at *5. Sound View does not and cannot challenge Mr. Jeffords’ credentials as an expert. C. Sound View’s Remaining Cited Precedent is Inapposite Sound View offers little support for its attempt to exclude Mr. Jeffords’ opinions on non-infringing alternatives in the other cited precedents. For example, Toyo Tire & Rubber Co. v. Doublestar Dong Feng Tyre Co., 2018 WL 3203421 (C.D. Cal. June 26, 2018), did not consider whether to exclude a damages expert’s testimony based on his reliance on technical experts and discussions with relevant personnel. The damages expert there had rested his opinion about lost profits on the “gut feeling” of the plaintiff’s marketing executive, who speculated the plaintiff “could have made half of the sales that otherwise went to the [defendant].” Id. Even less applicable is Kaneka Corp. v. SKC Kolon PI, Inc., 2017 WL 6343537 (C.D. Cal. Dec. 8, 2017). Kaneka did not involve excluding any expert testimony at all. Instead, Kaneka addressed a motion for judgment as a matter of law following a jury verdict that granted a plaintiff lost profits. Id. at *10. The defendants had “offered no expert witness of their own to rebut [plaintiff’s damages expert’s] testimony during trial.” Id. After the plaintiff put on evidence to establish that no non-infringing alternatives existed (one of the requirements to entitle a plaintiff to lost profits damages), the defendant failed to offer evidence to the Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 23 of 28 Page ID #:17546 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 22 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 contrary. Id. at *11-12. Thus, the defendants’ conclusory claim, unsupported by any evidence, that non-infringing alternatives were available during the damages period was not sufficient to set aside the jury verdict. Id. at *12. The court also did not consider whether to exclude any expert testimony in Apple, Inc. v. Samsung Elecs. Co., 2014 WL 6687122 (N.D. Cal. Nov. 25, 2014). Instead, the district court was acting as a fact finder by weighing the opinions of two damages experts in an effort to determine an ongoing royalty rate. Id. at *13. The district court rejected the plaintiff’s damages expert’s unsupported speculation about how the jury might have calculated damages in differently. Id. at *15. In LaserDynamics, Inc. v. Quanta Computer, Inc., 2011 WL 197869 (E.D. Tex. Jan. 20, 2011), the damages expert never considered or offered any opinion as to whether the defendant “had the necessary equipment, know-how, and experience to implement” alternative designs described only in a patent filing. Id. at *1 (distinguishing the Federal Circuit’s holding in Grain Processing Corp. v. Am. MaizeProds. Co., 185 F.3d 1341 (Fed. Cir. 1999)). Because the defendants’ damages expert had failed to offer any opinion or facts “as to whether Quanta would be capable of implementing the non-infringing alternatives identified in his report,” the Court excluded his opinions on non-infringing alternatives. Id. D. Mr. Jeffords’ Testimony About the Lack of Benefits from the Patents Is Supported By the Technical Experts Mr. Jeffords, who is not a technical expert, states that he understands from discussions with Dr. Crovella that Hulu experiences “no significant efficiency gain for programmers using chained jQuery operators as compared to alternative options,” and that there “is no performance advantage in the execution of the software when it includes chained jQuery operators.” Dkt. No. 249-3 at 7. In addition to these discussions between the two experts, Dr. Crovella directly supported this opinion in his report by building a design-around that took mere hours to implement and “would not affect the operation of the accused Hulu web Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 24 of 28 Page ID #:17547 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 23 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 applications.” Dkt. No. 247-5 at 43. Similarly, Mr. Jeffords states that he understands from discussion with Dr. Chase that “there is no benefit to Hulu implementing the technology of the Helper Server Patents as compared to methods that are available in the prior art.” Dkt. No. 249-3 at 7. This too is supported throughout Dr. Chase’s report, including his discussion of non-infringing alternatives “traditional Web caching techniques” disclaimed in the ’213 Patent. Dkt. No. 249-4 at 24. Despite contending that Dr. Chase and Dr. Crovella “cannot testify that Hulu receives no benefit from the patents,” Dkt. 294-2 at 15, Sound View did not ask either technical expert about these discussions in their depositions, despite receiving Mr. Jeffords’ expert report well in advance. Sound View also claims that Mr. Jeffords “makes no adjustment to his damages numbers based on the supposed lack of benefit.” Dkt. 294-2 at 15. This assertion is nonsensical. The “benefits to those who have used the invention” is one of the factors considered in the Georgia Pacific analysis, a framework that both damages experts employ. See Georgia-Pac. Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116, 1120 (S.D.N.Y. 1970). Sound View does not suggest Mr. Jeffords did not consider it. But the cost to Hulu of designing-around the asserted claims of the patents-in-suit would not be “adjusted” depending upon the benefit (or lack of benefit) of the claimed technology. E. Both Mr. Jeffords and Mr. Yurkerwich Provide Testimony Regarding Hulu’s Licensing History Both Mr. Jeffords and Sound View’s damages expert, Mr. Yurkerwich, offer opinions on the licensing history of both Hulu and Sound View in their respective expert reports. Westin Decl., Ex. 26 at 23-24 and 40-58, Ex. 25 at 34-56. Neither expert calculates the reasonable royalty amounts at the hypothetical negotiations directly from licenses, but Sound View contends that Mr. Jeffords alone should not be allowed to testify about Hulu’s licensing history at trial. Dkt. No. 249-2 at 16. Mr. Jeffords does not calculate his damages opinions from the amounts of Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 25 of 28 Page ID #:17548 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 24 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Hulu’s previous licenses. Instead, he opines about the similarities and differences in Hulu’s licensing history compared to the hypothetical negotiations in this case. For each Hulu license, Mr. Jeffords analyzes the parties, the scope, the licensed patents, the licensed products, and the compensation for the license. Westin Decl., Ex. 26 at 40-58. He then concludes that: Id. at 58. He lists this licensing history among four other factors that the hypothetical negotiators would consider when determining the type of license that would result from the hypothetical negotiations. Id. at 23. Sound View’s purported concerns with Mr. Jeffords’ opinions about Hulu’s licensing history “are appropriate fodder for cross-examination,” not admissibility. Gen-Probe Inc. v. Becton Dickinson & Co., 2012 WL 9335913, at *2-3 (S.D. Cal. Nov. 26, 2012) (denying motion to exclude damages expert’s testimony on plaintiff’s licenses because plaintiff “may highlight the technological and economic distinctions at trial” and “concerns about the effect litigation” were “better directed to weight, not admissibility”). Even when licenses differ from the hypothetical negotiation, they may still be “are relevant for discovery purposes and may lead to the discovery of admissible evidence.” Barnes & Noble, Inc. v. LSI Corp., 2012 WL 1564734, at *3 (N.D. Cal. May 2, 2012). The cases Sound View cites do not support excluding Mr. Jeffords’ opinions. To the contrary, in Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197 (Fed. Cir. 2010), the Court allowed a damages expert to testify regarding one of the plaintiff’s patent licenses because the expert had “noted multiple differences between the [plaintiff’s previous] licensing scenario and a hypothetical negotiation with Defendants.” Id. at 1211-12. The jury “‘was entitled to hear the expert Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 26 of 28 Page ID #:17549 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 25 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 testimony and decide for itself what to accept or reject.’” Id. at 1212 (quoting i4i Limited, 598 F.3d at 856). So long as “the record does not rest on faulty assumptions and a lack of reliable economic testimony,” it was the jury’s function “to weigh contradictory evidence, to judge the credibility of the witnesses, and to resolve factual disputes.” Id. (quoting C & F Packing Co. v. IBP, Inc., 224 F.3d 1296, 1304 (Fed. Cir. 2000)). In Utah Med. Prod., Inc. v. Graphic Controls Corp., 350 F.3d 1376 (Fed. Cir. 2003), the defendant’s damages expert “attempted to offer expert testimony based on industry license agreements and some Utah Medical license agreements to establish that a reasonable royalty rate for the…patented technology was about 6%.” Id. at 1385 (emphasis added). Mr. Jeffords does no such thing. Finally, Sound View misstates the conclusion of Wordtech Sys., Inc v. Integrated Networks Sols., Inc., 609 F.3d 1308 (Fed. Cir. 2010). The Federal Circuit did not remand the case for a new trial on damages “because [the] licenses were not economically comparable.” Dkt. 249-2 at 16-17. Instead, after a jury reached an unexplained lump sum verdict of $250,000, the plaintiff on appeal unsuccessfully attempted to support the verdict by pointing to various pieces of evidence, including the plaintiff’s license agreements that had been presented at trial. 609 F.3d at 1320-22. The Federal Circuit did not rule on the admissibility of this evidence, but concluded it did not support the verdict. Id. at 1322. Mr. Jeffords clearly explained how his analysis of Hulu’s licensing history would have been considered in the hypothetical negotiation, and also how it would not. Sound View’s attempt to exclude these agreements from trial, while at the same time embracing is nothing more than an attempt to tip the scales of the hypothetical negotiation. IV. CONCLUSION The Court should deny Sound View’s motion to exclude portions of Mr. Jeffords’ testimony. Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 27 of 28 Page ID #:17550 TO BE FILED UNDER SEAL - ATTORNEYS’ EYES ONLY - 26 - DEFENDANT’S OPPOSITION TO MOTION TO EXCLUDE JEFFORDS TESTIMONY CASE NO. LA CV17-04146 JAK (PLAX) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated: March 18, 2019 O’MELVENY & MYERS LLP BRETT J. WILLIAMSON JOHN C. KAPPOS CAMERON W. WESTIN BO K. MOON BRADLEY M. BERG By: /s/ Brett J. Williamson Brett J. Williamson Attorneys for Defendant and Counterclaim-Plaintiff HULU, LLC Case 2:17-cv-04146-JAK-PLA Document 308 Filed 03/18/19 Page 28 of 28 Page ID #:17551