The patent marking issue is not, by any means, the more interesting issue addressed by the court yesterday. Of greater significance is the court's tentative order on the issue of whether portions of Dr. Cockburn's (Oracle's damages expert) report should be excluded. (642 [PDF; Text]) You will recall that this is the second draft of the Cockburn report, Judge Alsup having tossed the first draft back in July. (Damages Report - Try Again, Oracle) However, Google still objected to the second Cockburn report and used one of its five motions in limine to seek exclusion of portions of that second report. (494 [PDF; Text]) Judge Alsup has now issued a tentative order, and it is worth reviewing how he has dealt with each of the objections:
The bottom line is that, once again, Google did its homework and presented its case without a lot of shouting and waving of arms. As a result, the court is far more inclined to grant Google most, although not all, of its requested exclusions. Some of these would simply be devastating to the Oracle damages arguments, so don't expect Oracle to simply roll over. The court has asked the parties to respond, and you can be assured that Oracle will complain. What is clear is that, even if Oracle is able to claw some of these back, its damages arguments are going to suffer and any damages awarded would not likely be anywhere close to the earliest numbers being thrown around in this case.
Of course, some argue that what Oracle is driving for here is a permanent injunction that would force Google to either exit the Android market or come to the negotiating table with Oracle. But those arguments seem to rely largely on the law as it was interpreted prior to eBay. eBay and subsequent cases decided in light of eBay no longer presume injunctive relief is automatic, and the court would be obligated to look at all of the balancing factors before making an injunctive relief determination. Many of those factors will cut in favor of Google and against Oracle, so no one should presume that, even if Oracle can prove infringement (which is still uncertain) that it would be able to obtain an injunction.
IN THE UNITED STATES DISTRICT COURT
ORACLE AMERICA, INC.,
FOR THE NORTHERN DISTRICT OF CALIFORNIA
No. C 10-03561 WHA
GRANTING IN PART AND
DENYING IN PART GOOGLE’S
MOTION IN LIMINE # 3 TO
EXCLUDE PORTIONS OF
DR. COCKBURN’S REVISED
In this patent and copyright infringement action involving Java and Android, defendant
moves in limine to strike portions of plaintiff’s revised expert damages report. For the following
reasons, the motion is tentatively GRANTED IN PART and DENIED IN PART.
The facts of this action have been set forth in previous orders (see Dkt. Nos. 137, 230,
433). Google’s instant motion seeks to strike portions of the revised damages report by Oracle’s
expert, Dr. Iain Cockburn. A prior order rejected Dr. Cockburn’s first damages report for failing
to apportion the value of the asserted claims and instead using the total value of Java and Android
in calculating damages, among other reasons (Dkt. No. 230).
In his second damages report, Dr. Cockburn estimated damages, from 2007 through 2011,
to be $201.8 million for patent infringement, $823.9 million in unjust enrichment for copyright
infringement (not deducting for expenses or apportionment), and $136.2 million in lost profits or
$102.6 million in lost licensing fees for copyright infringement (Cockburn Report [Rpt] ¶¶ 47,
467, 496, and 474; Exhs. 3, 22, 23). Dr. Cockburn calculated patent damages using a
hypothetical negotiation method: he began with a $100 million starting value that was based on
real-world negotiations between the parties in 2006, then adjusted downward for patent
apportionment, then adjusted upward for lost revenue that was expected from the licensing
agreement (Rpt ¶ 19). The same methodology was used to calculate a hypothetical lost license
fee for copyright infringement (Rpt Exhs. 23–24). Unjust enrichment was calculated by adding
together Android’s ad revenue, the hardware revenue from selling Nexus phones, and applications
sales in the Android Market store (Rpt ¶ 466). Lost profits were calculated by adding together
lost revenue from licensing Java, ancillary revenue from back-end services, and revenue from a
smartphone operating system (Rpt ¶ 475). Using similar methodology, Dr. Cockburn also
estimated future royalties in 2012 to be $1.2 billion in unjust enrichment for copyright
infringement, $102.6 million in lost license fees for copyright infringement, and $205.2 million
for patent damages (Cockburn Rpt Exhs. 22, 25, 18).
An expert witness may provide opinion testimony “if (1) the testimony is based upon
sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3)
the witness has applied the principles and methods reliably to the facts of the case.” FRE 702.
District courts thus “are charged with a ‘gatekeeping role,’ the objective of which is to ensure that
expert testimony admitted into evidence is both reliable and relevant.” Sundance, Inc. v.
DeMonte Fabricating Ltd., 550 F.3d 1356, 1360 (Fed. Cir. 2008).
Google raises several objections to Dr. Cockburn’s report. Each of Google’s arguments
will be addressed below.
1. SUN WOULD NOT HAVE LICENSED AN INCOMPATIBLE VERSION OF JAVA TO
Google argues that damages cannot be based on a hypothetical lost license fee because
Sun would never have licensed an incompatible version of Java to Google (Br. 4, Supp. Br.
11–14). This tentative order disagrees.
“The [reasonable] royalty may be based upon an established royalty, if there is one, or if
not, upon the supposed result of hypothetical negotiations between the plaintiff and defendant.
The hypothetical negotiation requires the court to envision the terms of a licensing agreement
reached as the result of a supposed meeting between the patentee and the infringer at the time
infringement began.” Rite-Hite Corp. v. Kelley Co., Inc., 56 F.3d 1538, 1554 (Fed. Cir. 1995)
(citations omitted); see also Polar Bear Productions, Inc. v. Timex Corp., 384 F.3d 700, 709 (9th
Cir. 2004) (applying the hypothetical lost license fee calculation in the context of copyright
In support of its argument that damages cannot be based on a hypothetical license, Google
cites an unpublished opinion from this district, Oracle USA, Inc. v. SAP AG, No. C07-1658 PJH,
2011 WL 3862074 (ND Cal. Sept. 1, 2011) (Hamilton, J.). In SAP, the district court granted
accused infringer’s motion as a matter of law to strike the jury’s award of actual damages based
on a hypothetical license calculation. 2011 WL 3862074 at *1. Judge Hamilton gave two reasons
for her holding: first, the copyright owner did not establish that, but for infringement, it would
have licensed the asserted copyrighted works for the use at issue, and second, the copyright owner
did not present evidence sufficient to value such a license. Judge Hamilton held that the awarded
damages were too speculative in that situation. Id. at 9–10. In a subsequent opinion, Judge
Hamilton shed light on her prior holding by stating, “The court did not hold as a matter of law . . .
that copyright damages based upon the amount of a willing buyer would reasonably have paid a
willing seller under a hypothetical license are available only if the copyright owner provides
evidence of actual licenses it entered into or would have entered into . . . .” Oracle USA, Inc. v.
SAP AG, No. C07-1658 PJH, Dkt. No. 1088 at 2.
The holding in SAP is distinguishable. Dr. Cockburn had a non-speculative factual basis
to value a license for an incompatible version of Java. Dr. Cockburn did so by starting with the
real-world negotiations between Sun and Google for a compatible Java, and then adjusting that
amount up to compensate for the incompatibility. The amount of the upward adjustment was
based on Sun’s own revenue projections for the value of compatibility. Dr. Cockburn’s
calculation was based on real-world facts and not incurably speculative. Google fights the
hypothetical by ignoring the legal requirement for a hypothetical negotiation that the licensing
agreement must be reached as the result of a hypothetical meeting between the parties. See
Rite-Hite Corp., 56 F.3d at 1554. Google’s objections are tentatively overruled.
2. STARTING POINT OF $100 MILLION.
Google argues that Dr. Cockburn erred by using $100 million as his starting point for the
hypothetical negotiation instead of $28 million, which was the amount in a draft agreement dated
April 19, 2006 for a “broad technology partnership” between the parties (Br. 2). This tentative
Dr. Cockburn’s decision not to use the $28 million draft agreement as the starting point
was within the bounds of reason, although a jury may eventually reject the premise. Contrary to
Google’s assertion that Dr. Cockburn ignored the agreement, he actually discussed it for two
pages in his report (Rpt ¶¶ 211–16). Dr. Cockburn opined that important terms of the $28 million
draft agreement were still being negotiated (Rpt ¶ 212). As a factual basis for his opinion that
terms were not finalized, Dr. Cockburn cited the “Go To Market Plan” section of the agreement,
which had the following text: “Need to discuss. We propose agreement to the price in return for
Sun’s hosting & ISV leadership” (Rpt ¶ 211) (emphasis added). Dr. Cockburn also cited emails
from Sun executives suggesting that management had not decided on the final terms of the
agreement (Rpt ¶¶ 213–16). Google does not rebut those citations. Having reviewed the
available record, this order finds that Dr. Cockburn reasonably relied on sufficient facts when
rejecting the $28 million draft agreement as a starting point.
The order also finds that Dr. Cockburn did not err in using $100 million as the starting
point. Dr. Cockburn extensively reviewed the entire licensing history between the parties (Rpt ¶¶
191–221). The $100 million was on the table during actual negotiations in February and April
2006 (Rpt ¶¶ 196, 207). Dr. Cockburn decided on a $100 million fee for “a worldwide [Java]
license” (Rpt ¶ 228). Although not entirely clear from Dr. Cockburn’s report, this license would
likely have included “all Sun owned CD JavaME technologies, unencumbered rights” and
“engineering and back-end support and services,” and “joint promotion of the Java brand” (Rpt ¶¶
230–31). Dr. Cockburn also opined that this $100 million amount would have been structured as
$60 million in fixed payments and the remainder as ad-revenue sharing (Rpt. Exh. 14). This deal
was very similar to the opening draft agreement by the parties in February 2006, and could be the
basis for a hypothetical negotiation. Google’s objections are tentatively overruled.
3. UPWARD ADJUSTMENT OF THE STARTING POINT.
Dr. Cockburn adjusted the starting point upward to account for lost convoyed sales that
was expected from real-world negotiations (Rpt Exh. 3). Google argues that this upward
adjustment was speculative because Dr. Cockburn relied on “a single internal Sun presentation
that roughly sketch[ed] a projection of the money Sun might earn from a partnership with
Google,” (Br. 5). Google argues that this presentation reflected “Sun’s optimistic hope, without
any grounding in experience or past practice, that it might be able to earn money by partnering
with Google” (Br. 5); and that Dr. Cockburn improperly ignored the fact that this would have
been a new line of business, he did not vet the reliability of the projections with anyone at Oracle,
and he did not see any other documents to support the lost profit projection (Br. 10).
A patent owner may be able to recover directly for loss of collateral sales on a lost-profits
theory, but lost convoyed sales remain relevant to a reasonable royalty even where the patent
owner’s proof is insufficient to show lost profit. Georgia-Pacific Corp. v. United States Plywood
Corp., 318 F. Supp. 1116, 1121, 1128–1130 (S.D.N.Y. 1970); see also Rite-Hite Corp. v. Kelley
Co., Inc., 56 F.3d 1538, 1554–55 (Fed. Cir. 1995) (en banc) (holding that lost profits can
substantially inform a hypothetical negotiation analysis).
Dr. Cockburn based his upward adjustment on three factors: first, “harm to Sun, in the
form of foregone licensing revenues and convoyed sales that Sun expected to generate pursuant
to” licensing its technology to Google, second, “the effect of fragmentation on non-mobile Java
revenues portended by [alleged] infringement,” and third, a “litigation premium” reflecting the
fact that the hypothetical negotiation must assume that the patents are valid and infringed (Rpt ¶¶
35–40). Although noting that the harm from fragmentation would have been great, Dr. Cockburn
opined that only lost convoyed sales had a reasonably calculated value (ibid.; Cockburn Dep. at
This upward adjustment was not improper. From the parties’ discussions during the 2006
negotiations and Sun’s business model, it was clear that Sun expected convoyed sales after
licensing a compatible version of Java to Google. Sun’s expectations are catalogued qualitatively
in a variety of documents (see, e.g., Rpt ¶¶ 297–99) and quantitatively in financial projections
(Rpt ¶¶ 298–302; Purcell Exhs. 18–19). The jury could reasonably find that Google’s
infringement led to an Android that is incompatible with Java and precluded Sun from receiving
convoyed sales “through licensing royalty bearing commercial implementations, using TCK
licenses to maintain the integrity of the Java platform, and providing backend services and
potentially other revenue opportunities” (Rpt ¶ 288). If so, then the hypothetical negotiation
should take that lost revenue into account and upwardly adjust the licensing fee Sun would have
required to license an incompatible version of Java. Dr. Cockburn has an sufficient factual basis
for this calculation.
While the amount of adjustment involves an element of uncertainty, Dr. Cockburn’s
quantitative analysis is based on sufficiently reliable financial projections. See Interactive
Pictures Corp. v. Infinite Pictures, Inc., 274 F.3d 1371, 1385 (Fed. Cir. 2001) (upholding a
hypothetical royalty based on a contemporaneously created business plan projecting revenue).
The convoyed sales projections were contemporaneously calculated by Kathleen Knopoff, a
senior director of business operations at Sun. Google has not explained why Ms. Knopoff would
have projected an overly optimistic amount. Furthermore, Dr. Cockburn opined that the
unaccounted-for qualitative basis for the upward adjustment — harm from fragmentation and the
litigation premium — help to alleviate concerns that Ms. Knopoff’s financial projections may
have been optimistic (see, e.g., Rpt ¶¶ 283–85). Google’s objections to the upward adjustment
are tentatively overruled.
4. APPORTIONMENT OF THE STARTING VALUE AND UPWARD ADJUSTMENT.
Dr. Cockburn’s reasonable royalty calculation for both patent and copyright infringement
depended on his opinion that the patents-in-suit were worth 30% and the copyrights-in-suit
worth 15% of the $100 million starting value and upward adjustment of nearly $600 million.
These percentages were used to proportionally adjust the starting-point fee and the upward
adjustment in the hypothetical negotiation calculation. Google argues that because Dr. Cockburn
had no sense of the value of the intellectual property not at issue in this action, but that was on the
table during the 2006 negotiations, he could not quantify the relative value of the patents and
copyrights-at-issue to the entire licensing package encompassed in the $100 million starting
value. This tentative order agrees.
Dr. Cockburn admittedly did not analyze the rest of the license bundle that made up the
$100 million starting value. As contemplated by Sun and Google during their 2006 negotiations,
a $100 million fee gave Google access to “all Sun owned CD JavaME technologies,
unencumbered rights” and “engineering and back-end support and services,” and “joint promotion
of the Java brand” (Rpt ¶¶ 230–31). This potentially included thousands of patents and all the
copyrightable source code. Moreover, in its opposition brief, Oracle even suggests that a portion
of the $100 million fee had nothing to do with licensing, but was needed to compensate Sun for
short-term revenue loss for moving into an open-source business model (Supp. Opp. 15).
Dr. Cockburn admitted that he had no specific information about what Google would have
received under the contemplated partnership besides licenses to the patents and copyrights-in-suit
(Cockburn Dep. at 78:14–23, 78:25–79:9). Thus, Dr. Cockburn did not value any of those other
components in the $100 million starting value: the other intellectual property licenses, Sun’s
engineering know-how, and amount needed to supplement Sun’s revenue for moving into open
In his deposition, Dr. Cockburn admitted that he did not know how many total patents
were in the licensing bundle between Sun and Google (Cockburn Dep. 78:4–13). He did not
know what functionality the other patents covered (Cockburn Dep. 78:25–79:9). And he did not
try to calculate the value to Google of the other Sun-owned patents not at issue in this case
(Cockburn Dep. 78:25–79:9). Dr. Cockburn admitted that he similarly did not value the other
copyrights in the license bundle (Cockburn Dep. 79:14–80:13, 80:15). Dr. Cockburn also
admitted that he did not value the right to use Sun’s trademarks (Cockburn Dep. 81:21–82:5).
Dr. Cockburn admitted that he did not value non-intellectual property, such as access to Sun’s
engineers or the compensation for Sun’s short-term revenue loss, that was contemplated in the
2006 negotiations (Cockburn Dep. 84:7–85:5).
Dr. Cockburn reached the 30% apportionment for the patents-in-suit by calculating the
“the specific contribution of the patents-in-suit to Android’s success in generating revenues as
distinct from the contributions of other factors” (Rpt ¶ 29). He used the same methodology to
calculate the 15% apportionment for the copyrights-in-suit (Rpt ¶ 474). Using performance
studies, econometric studies, and conjoint analysis, Dr. Cockburn had a reliable basis for valuing
the patents and copyright-in-suit’s relative contribution to the success of Android (see Rpt ¶¶
252–277). But that is insufficient by itself to apportion the value of the patent and copyrights-insuit
relative to the total value of the license bundle discussed in 2006, which is encompassed in
the $100 million starting value, or to the amount of the upward adjustment for lost convoyed
Dr. Cockburn calculated the apportionment by “comparing the value added to Google
from its use of the patents-in-suit to the value added to Google from its use of the Java technology
as a whole” (Rpt ¶ 251) (emphasis added). Without describing what “Java technology as a
whole” encompassed, Dr. Cockburn then assumes that the value added to Google from its
supposed use of Java technology as a whole was the entire value of Android (Rpt ¶ 244). But
Android is not equivalent to the value of the license bundle discussed during the 2006
negotiations. The value of Android could been more or less. Dr. Cockburn even admitted that
the value of Android could be worth more (Rpt ¶ 272 n. 327). There is no explanation for why
Android’s earnings would match the entire value of the 2006 license bundle, which included
potentially thousands of patents, copyrights, trademark, and access to Sun engineers.
Dr. Cockburn’s explanation for why he used total Android ad revenue as his denominator:
because the license bundle was essential to developing Android (Rpt ¶¶ 244–45, 272). Even
assuming that is true, it does not explain why the values of the 2006 license bundle and Android
should be equal or even closely similar. In sum, Dr. Cockburn’s methodology is flawed because
he does not adequately explain why the value of Android is an appropriate substitute for the value
of the 2006 licensing bundle.
There is no controlling law on point to guide this inquiry on the reliability of
Dr. Cockburn’s methodology. Courts frequently allow experts to calculate a reasonable royalty
percentage based on the value of the patents-in-suit to the infringer’s revenue from the accused
products. But in those cases, the next step is for the expert to calculate a reasonable royalty
amount by multiplying the infringer’s revenues and the reasonable royalty rate. See, e.g., Finjan
Inc. v. Secure Computing Corp., 626 F.3d 1197, 1208–1211 (Fed. Cir. 2010) (finding that, based
on internal documents calling the patented features important, the jury could infer that a
substantial fraction of the accused products’ profits stemmed from the patented invention). In the
instant action, Dr. Cockburn did not use the value of the patents to apportion infringer’s profits,
but instead apportioned the purchase price of a broad license portfolio without any basis to opine
on the value of the rest of that license portfolio.
A similar situation arose in Medtronic, Inc. v. Boston Scientific Corp., 2002 WL 34447587
at *12 (D. Minn. Aug. 8, 2002). The Medtronic court excluded an expert’s opinion that two
patents-in-suit “accounted for virtually all of the $25 million” paid for a license to an intellectual
property portfolio without adequate factual support. The court faulted Medtronic’s expert for not
“determin[ing] the value to Medtronic of any of the items in that portfolio other than the patentsin-
suit” and for speculating that the patents-in-suit accounted for substantially all of the value of
the portfolio based on his “gut feeling.” Id. at *11.
The order rejecting Dr. Cockburn’s first damages report warned “[i]f the next and final
report fails to measure up in any substantial and unseverable way . . . then it may be excluded
altogether without leave to try again” (Dkt. No. 230 at 15). Now this order tentatively strikes
Dr. Cockburn’s opinion on apportionment and along with it a significant portion of his second
damages report. Dr. Cockburn will not be able to opine on a reasonable royalty derived from a
hypothetical negotiation if he is unable to apportion the value of the patents and copyrights-insuit.
It is undecided whether or not Dr. Cockburn should be given a third opportunity to fix his
damages calculations. Counsel will be given an opportunity to submit statements on this question
once this order is finalized.
5. CLAIM-BY-CLAIM INSTEAD OF PATENT-BY-PATENT ANALYSIS.
Google argues that Dr. Cockburn should have conducted a claim-by-claim analysis of
damages instead of a patent-by-patent analysis (Br. 9). As such, Google requests that Dr.
Cockburn be precluded from apportioning an asserted patent’s value among its claims at trial
(ibid.). Google also requests that the Court instruct the jury that if they find any asserted claim
not infringed, they may assume that the non-infringed claim represented the full value of that
patent (ibid.). This tentative order agrees.
The prior order made clear that a claim-by-claim analysis of damages was preferable:
“determining the date of first infringement requires a claim-by-claim analysis” (Dkt. No. 230 at
7). There was a number of reasons for requesting a claim-by-claim analysis. First, this is
necessary to get the correct timeline to calculate past damages. Second, some of the asserted
claims might be less valuable, or easier to design around, than other claims contained within that
same patent. Third, this is necessary to calculate future damages if Google designs around some
claims but not others in the same patent. Fourth, the jury may find liability on some claims but
not others in the same patent. And fifth, some claims may be rejected by the USPTO on reexamination.
Oracle does not deny that Dr. Cockburn treats each patent as an indivisible whole (see Rpt
Exhs. 2, 4–13). Therefore, Dr. Cockburn is tentatively precluded from apportioning an asserted
patent’s value among its claims at trial. Furthermore, this tentative order holds that the jury will
be instructed that if they find any asserted claim not infringed, they may assume that the noninfringed
claim represented the full value of that patent.
6. NO DIVISION OF SEPARATE COPYRIGHT CLAIMS.
In a parallel manner, Google argues that Dr. Cockburn erred by not separating copyright
damages for the two categories of copyrighted material asserted in this action: the lines of
Android code and the structure, arrangement, and selection of the Application Programming
Interfaces (API) packages. This tentative order agrees.
Dr. Cockburn’s discussion of copyright damages focused almost entirely on the value of
the APIs (see Rpt Part XI). But if the jury concludes that the structure, arrangement, and
selection of the APIs is not copyrightable or that Google engaged in fair use with respect to APIs,
then Oracle’s copyright claim would be limited to only a dozen code files. Dr. Cockburn has not
adequately valued that code in his report and cannot do so at trial. The tentative order holds that
the jury will be instructed that if Google is found not liable for infringing the selection,
arrangement, and structure of the API packages, then Dr. Cockburn’s copyright damages analysis
7. INADEQUATE CALCULATION OF FUTURE DAMAGES.
Google argues that Dr. Cockburn erred by calculating future damages only through 2012
and not taking into account the varying expiration dates of the asserted patent claims (Br. 7–8).
Oracle does not deny that Dr. Cockburn only calculated damages through 2012 and did not
calculate damages for unexpired patents after that date.
The prior order instructed Dr. Cockburn that “any projection of future damages must take
into account the varying expiration dates of the asserted patent claims” (Dkt. No. 230 at 11)
(emphasis added). The reason for this requirement is that if Google were to design around a
claim, this Court can exclude damages based on that claim. Also, future damages that do not
allocate on a claim-by-claim bases are speculative because of the infringer’s ability to design
around claims. Although Dr. Cockburn did opine on the proportional value of each patent-atissue,
he did not show how future damages would be adjusted if certain patents expired or were
Because Dr. Cockburn’s report is speculative and unhelpful for calculating future damages
on a claim-by-claim basis, the portion of the report discussing future patent damages is tentatively
8. REFERRING TO LICENSES INVOLVING UNRELATED TECHNOLOGY AND PARTIES.
Google argues that Dr. Cockburn should be precluded from referring to noncomparable
licenses and settlements involving other companies (Supp. Br. 16). Specifically, Google seeks to
preclude Dr. Cockburn from discussing licenses involving Nokia, Qualcomm, and Apple, and
settlements between Sun and Microsoft (Br. 9–10).
Damges experts cannot use noncomparable licenses, with little relationship to the claimed
invention or parties-in-suit, as a basis for calculating reasonable royalties. See ResQNet, Inc. v.
Lansa, Inc., 594 F.3d 860, 870 (Fed. Cir. 2010).
In his report, Dr. Cockburn cursorily discussed licenses involving Nokia, Qualcomm, and
Apple (Rpt ¶¶ 104–105). Other than listing the licensing fees, Dr. Cockburn did little to describe
these licenses. The only description given about the technology is that the licenses involved
“intellectual property associated with mobile devices and services” (Rpt ¶ 104). Importantly, Dr.
Cockburn did not specify whether the referenced licenses related to software or hardware, or how
extensive the licenses were. Because there is so little information given about these licenses, this
order cannot see how a jury could adequately evaluate the probative value of those agreements.
References in Dr. Cockburn’s report to these licenses are tentatively STRICKEN.
Dr. Cockburn also referenced the settlement entered into between Sun and Microsoft in
2004, under which Microsoft agreed to pay Sun over $1 billion to settle ongoing litigation and to
enter into license agreements (Rpt ¶¶ 70–71). Dr. Cockburn opined that the settlement
exemplified the importance of compatibility to Java because Microsoft was threatening to
fragment the Java platform (ibid.). The problem with Dr. Cockburn’s analysis is that he confused
two separate litigations between Sun and Microsoft in the late-1990s and early-2000s.
Dr. Cockburn used Sun’s complaint from the earlier litigation to describe the importance of the
settlement amount from the later litigation. In 1997, Sun sued Microsoft for $35 million, alleging
that Microsoft breached its contract by trying to extend Java so it would work differently on
Windows computers. Sun Microsystems, Inc. v. Microsoft Corp, No. 97-20884 RMW (N.D. Cal).
One of Sun’s main arguments in the case was that Microsoft wrongfully advertised that its
products were Java-compatible because, in Sun’s eyes, they were not. The two parties settled in
2001 for $20 million. Sun, Microsoft settle Java suit, CNET News, January 23, 2001, accessed at
. In 2002, Sun sued Microsoft for $1 billion
claiming that Microsoft engaged in anticompetitive actions against Java. Sun Microsystems, Inc.
v. Microsoft Corp, No. 02-01150 RMW (N.D. Cal). In 2004, Sun and Microsoft settled the
lawsuit (Rpt ¶ 71). That settlement involved payments of $700 million to Sun by Microsoft to
resolve pending antitrust issues and $900 million to resolve patent issues. In addition, Sun and
Microsoft agreed to pay royalties for use of each other’s technology, with Microsoft making an
up-front payment of $350 million (ibid.). This second settlement was about more than
fragmentation, patent and copyright infringement. That litigation featured antitrust issues. This
is too dissimilar to be relevant to the damages calculation in the instant case. Dr. Cockburn did
not adequately describe the separate terms of the two different Sun-Microsoft settlements. His
confused discussion cannot help a jury evaluate the probative value of the settlements and will be
tentatively STRICKEN from the report.
For the reasons stated above, Google’s motion in limine is tentatively GRANTED IN PART
and DENIED IN PART. Calculations of future damages and references to nonparty licenses and
settlements are tentatively STRICKEN. Counsel for both parties may submit ten-page
supplemental memoranda critiquing this tentative ruling by DECEMBER 20 AT NOON. This
motion shall be one of the motions in limine to be heard at the final pretrial conference and shall
count as one of those selected for argument by Google.
IT IS SO ORDERED.
Dated: December 6, 2001.
/s/ William Alsup
UNITED STATES DISTRICT JUDGE