What I didn't consider was that there would be a separate legitimate reason for introducing preliminary USPTO findings. That possibility didn't slip past Google, and it has now raised the point that, although such information should be excluded at the time the jury considers the issue of invalidity, the same information should be permitted later on the issue of willfulness. (660 [PDF; Text])

Citing to the case of Power Integrations v. Fairchild Semiconductor, Google points out:

... the court agreed with the defendant that because “the reexamination proceedings here are far advanced and have not gone entirely well for the patentee . . . it would be unfair to [the defendant] to make a determination that it acted willfully . . . without even considering the possibility that the PTO may, in the end, invalidate one or more of [plaintiff’s] asserted patent claims.” Id. at 689.

Google also raises two points with respect to the two cases cited by Oracle as "new" in the Oracle letter: Presidio Components and Realtime Data. First, contrary to Oracle's statement in its December 27 letter, neither of these cases is new since Oracle had already referenced them in earlier filings and could have included them in their brief pertaining to their motion in limine No. 1.

Second, those two cases don't address the issue at hand because they dealt with unitary trials, i.e., all issues were dealt with at once, not in sequenced phases. As such, those cases could not provide a mechanism for avoiding the prejudice to the plaintiff. Since the Oracle v. Google trial is to be trifurcated, the mechanism to avoid prejudice is available here.

Anticipate that Judge Alsup will grant Oracle's motion, since Google does not challenge the fundamental principle of prejudice of introducing preliminary reexamination information on the issue of validity, but also anticipate that Judge Alsup will qualify the order by permitting the later introduction of the preliminary reexamination information on the issue of willfulness in phase three of the trial.

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Docket

660 - Filed and Effective: 12/28/2011
Letter
Document Text: Letter from Robert Van Nest to the Court in opposition to Oracle's Motion in Limine No. 1. (Attachments: # 1 Exhibit Case Attachment)(Van Nest, Robert) [GROKLAW NOTE: The information provided in Attachment 1 consists of the case report of Power Integrations v. Fairchild Semiconductor, 763 F. Supp. 2d 671 (D. Del. 2010). Because the document submitted by the Keker firm is a reprint from Westlaw and contains proprietary Keycite and numbering information, we have elected to provide an alternative source for the same information.]

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Document

660

[Keker & Van Nest LLP letterhead]

December 28, 2011

Honorable William Alsup
U.S. District Court
Northern District of California
Courtroom 8 – 19th Floor
450 Golden Gate Avenue
San Francisco, CA 94102

Re: Oracle America, Inc. v. Google Inc., No. 3:10-cv-03561 WHA

Dear Judge Alsup:

Google wishes to bring to the Court’s attention an additional case relevant to Oracle’s Motion in Limine No. 1 to Exclude Evidence or Argument Regarding Patent Reexaminations (Dkt. No. 498).

In Power Integrations v. Fairchild Semiconductor, 763 F. Supp. 2d 671 (D. Del. 2010), the court specifically addressed the relationship between the admissibility of PTO re-examinations and furcated trials. In considering the admissibility of PTO re-examinations in what was then a unitary trial, the court agreed with the defendant that because “the reexamination proceedings here are far advanced and have not gone entirely well for the patentee . . . it would be unfair to [the defendant] to make a determination that it acted willfully . . . without even considering the possibility that the PTO may, in the end, invalidate one or more of [plaintiff’s] asserted patent claims.” Id. at 689. The court also acknowledged, however, that “there is a substantial risk of confusion and unfair prejudice if a jury deciding issues of infringement and validity is presented with the full record of the ongoing reexamination proceedings.” Id. (emphasis added). To “[b]alance[e] these competing concerns,” the court bifurcated the trial, “sever[ing] the issue of willful infringement for a separate trial.” Id. In so doing, the court stated that “[e]vidence of the pending reexaminations may be admissible at the willfulness trial,” although it deferred deciding the issue. Id. The trial in Power Integrations is scheduled for 2012.

The court’s analysis in Power Integrations supports Google’s position that admitting the PTO reexamination evidence in the third phase of this case, after liability issues such as validity and infringement have been decided, would eliminate the risk of unfair prejudice to Oracle. As Google noted in its Opposition to Oracle’s Motion in Limine No. 1, the primary purpose for which Google seeks to admit the evidence of the PTO re-examinations is in defending against

Honorable William Alsup
December 28, 2011
Page 2

Oracle’s willfulness allegations — a phase-three issue that will be relevant only if the jury finds patent liability in phase two. As in Power Integrations, “the reexamination proceedings here are far advanced and have not gone entirely well for the patentee.” Id. at 689; see also 12/7/11 Supp. Joint Pretrial Conference Stmt., Dkt. No. 644 at 1-3 (PTO has currently rejected eighty percent of the asserted claims where it has issued office actions); 12/23/11 Joint Update on Re- Examination of 476 Patent, Dkt. No. 655. Thus, it would be unfair if Google cannot counter Oracle’s allegations of scienter with evidence of the re-examination proceedings. See Power Integrations, 763 F. Supp. 2d at 689. This is particularly true in light of the PTO statistics discussed at the pre-trial conference, which reflect that, historically, claims are all canceled or at least in part changed 77% of the time for ex parte re-examinations and 89% of the time for inter partes re-examinations. See http://www.uspto.gov/patents/stats/reexamination_information.jsp (linking to statistics for ex parte and inter partes re-examination statistics).

The two cases Oracle cites in its December 27, 2011 letter to the Court are not new authority. Oracle already cited both in its Motion in Limine No. 1. See Oracle Motion in Limine No. 1 at 3:14-25 (citing and quoting Presidio Components Inc. v. American Technical Ceramics Corp., No. 08-CV-335-IEG (NLS), 2009 U.S. Dist. LEXIS 106795 (S.D. Cal. Nov. 13, 2009), and Declaration of Daniel P. Muino in Support of Oracle America, Inc.’s Motions In Limine Nos. 1 Through 5 (“Muino Decl.”), Exhibit A (Dkt. No. 503-1), Realtime Data, LLC v. Packeteer, Inc., No. 6:08-cv-144 (E.D. Tex. Dec. 30, 2009)); see also Google’s Opposition to Oracle’s Motion in Limine No. 1 at 4:19-24 (distinguishing these cases). Moreover, Realtime Data and Presidio Components are not as on-point as Power Integrations because they only address unitary trials, which present a different prejudice analysis than a trifurcated trial such as this one. Realtime Data excluded evidence of PTO re-examinations based on the unfair prejudice that could arise if a jury considering infringement and validity were presented with the re-examination evidence. Muino Decl., Exhibit A, Realtime Data at 4 (“Even if the jury is instructed to consider the Office Action for the limited purpose of assessing objective recklessness, there is a strong likelihood that the jury would be confused as to its relevance and use this evidence in considering the validity of the ‘104 patent.” (emphasis added)). Presidio Components never specified the relevant “unfair prejudice” at all. Presidio Components, 2009 U.S. Dist. LEXIS 106795. As Power Integrations suggests, any concern that unfair prejudice could arise if evidence of PTO reexaminations were submitted to a jury deciding validity and infringement would be eliminated by admitting evidence of the PTO re-examinations only in the third phase of this trial, after issues of validity and infringement have already been decided.

Sincerely,

/s/ Robert A. Van Nest

Robert A. Van Nest