American Patents LLC v. Mediatek, Inc. et al

Western District of Texas, txwd-6:2018-cv-00339

Exhibit B [6-21-19 Tr. Excerpts]

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5 1 1 IN THE UNITED STATES DISTRICT COURT 2 FOR THE WESTERN DISTRICT OF TEXAS 3 WACO DIVISION 4 AMERICAN PATENTS, LLC * * 5 * VS. * CIVIL ACTION NO. W-18-CV-339 6 * MEDIATEK, INC, ET AL * June 21, 2019 7 BEFORE THE HONORABLE ALAN D ALBRIGHT, JUDGE PRESIDING 8 TELEPHONIC SCHEDULE CONFERENCE AND MOTION HEARING 9 APPEARANCES: 10 For the Plaintiff: Stafford Grigsby Helm Davis, Esq. The Stafford Davis Firm, PC 11 The People's Petroleum Building 102 North College Ave, 13th Floor 12 Tyler, TX 75702 13 Larry D. Thompson, Esq. Zachariah Harrington, Esq. 14 Christopher Ryan Pinckney, Esq. Antonelli, Harrington Thompson LLP 15 4306 Yoakum Blvd., Suite 450 Houston, TX 77006 16 For the Defendants: Eric W. Schweibenz, Esq. 17 John S. Kern, Esq. Oblon, McClelland, Maier & 18 Neustadt, LLP 1940 Duke Street 19 Alexandria, VA 22314 20 Tyler T. VanHoutan, Esq. McGuire Woods LLP 21 600 Travis Street, Suite 7500 Houston, TX 77002 22 Eric H. Findlay, Esq. 23 Findlay Craft, P.C. 102 N. College Ave, Suite 900 24 Tyler, TX 75702 25 5 2 1 Lai L. Yip, Esq. Sheppard, Mullin, Richter 2 & Hampton LLP Four Embarcadero Ctr, 17th Floor 3 San Francisco, CA 94111 4 Martin R. Bader, Esq. Sheppard, Mullin, Richter 5 & Hampton LLP 12275 El Camino Re al Suite 200 6 San Diego, CA 92130 7 Gilbert Andrew Greene, Esq. Duane Morris LLP 8 900 S. Capital of Texas Highway Suite 300 9 Austin, TX 78746 10 Kevin Anderson, Esq. Duane Morris, LLP 11 505 9th Street, N.W., Suite 1000 Washington, DC 20004-2166 12 Jonah D. Mitchell, Esq. 13 Reed Smith LLP 101 Second Street, Suite 1800 14 San Francisco, CA 94105 15 Steve Wingard, Esq. Scott Douglass & McConnico LLP 16 303 Colorado Street, Ste 2400 Austin, TX 78701 17 Court Reporter: Kristie M. Davis 18 United States District Court PO Box 20994 19 Waco, TX 76702-0994 20 21 22 Proceedings recorded by mechanical stenography, transcript 23 produced by computer-aided transcription. 24 25 5 8 1 going to grab a piece of paper so I have something to write on. 2 I'm going to let the plaintiff go through and basically 3 tell me what it is they want to do and then I'll hear from 4 defendants why they don't want them to do it or what they 5 thought the deal was and we'll go from there. So if the 6 plaintiff will tell me what discovery it is that they want to 7 take and when they can get it done by, that would be helpful. 8 MR. HARRINGTON: Your Honor, Zac Harrington on behalf of 9 American Patents. So the -- I think the discovery one is 10 pretty limited and pretty simple. We want documents that help 11 us -- that are going to help us with the deposition, and we 12 believe that if we get the documents which it would be 13 basically the sales contracts, the shipping contracts, the kind 14 of manufacturing contracts, the actual documents, the purchase 15 orders, those kind of things, that show -- we've given the 16 defendants a list of all the accused products that we're going 17 to be accusing. So, you know, basically here -- we gave them a 18 list that they're going to get of here's every single model of 19 the products, and if they can tell us, you know, give us the 20 contracts for each of those or the documents for each of those, 21 then we'll know who the correct party is. We think that the 22 correct party's still going to be Lenovo Group and/or Lenovo 23 Shanghai, but without those documents, we can't be for sure. 24 Our position is is that the only way that Lenovo Group and 25 Lenovo Shanghai can show that -- you know, they're claiming 5 9 1 still that they're not the correct parties, but the only way 2 they can show that they're not the correct parties is by 3 showing us documentary evidence as to who the correct party is. 4 So that's our position. We want the documents. And then if 5 necessary if the documents -- they don't have the particular 6 documents, these are kind of oral agreements or maybe this is 7 just something that somebody in China from Lenovo Group says, 8 hey. You know, go manufacture this way and it's not documents, 9 then I think we'll have to -- or there's just not sufficient 10 documentation, then we'll -- then we'd have to go do the 11 deposition. 12 THE COURT: Okay. For the defendants, starting off, tell 13 me whether or not you feel that the plaintiffs have been 14 specific enough in what it is that they're asking for from you. 15 MS. YIP: Good morning, Your Honor. This is Lai Yip from 16 Sheppard Mullin on behalf of the Lenovo defendants. In our 17 view the specificity is not the issue but more that the 18 plaintiff has completely blown the top off of what the Court 19 authorized at the hearing on the motion to dismiss. When we 20 left the hearing -- 21 THE COURT: Hold on just a second. So I just -- I just 22 want to take this in a couple of steps. Then I'm going to let 23 you keep going, but -- so you -- I just want to make sure that 24 you know what it is that they want and now you're about to 25 explain to the Court why this is more than what the Court 5 10 1 authorized, correct? 2 MS. YIP: Yes. Yes. 3 THE COURT: Okay. And that's fine. I just -- I want to 4 make sure what it is I'm going to be ruling on because it's 5 kind of a big picture thing at the moment. And so -- and so go 6 ahead and explain to me why it exceeds what you think the Court 7 wanted but also explain to me -- put on the record, please, an 8 idea for the Court of the amount of effort it would take for 9 you to accomplish the discovery. 10 MS. YIP: Sure. Absolutely, Your Honor. So when we left 11 the hearing on May 30th, our understanding of what the parties 12 were supposed to do was very clear to us. The Court authorized 13 a deposition of a witness in China regarding whether 14 jurisdiction was proper over the named Lenovo defendants only 15 and the parties and the Court had a very long and extended 16 colloquy about this subject. It was very clear to us that that 17 was the only additional jurisdictional discovery the Court 18 authorized and that it would be very limited in scope. And we 19 observed, actually, that it's quite consistent with the Court's 20 order governing proceedings which stays all fact discovery 21 until after Markman and only allows additional discovery if 22 exceptional circumstances warrant it. And so the limited 23 jurisdictional discovery which is on top of the previous 24 jurisdictional discovery, a deposition of Lenovo's -- of a 25 Lenovo chief financial officer, the limited scope of additional 5 19 1 and that's fine. We're okay with that. We just -- we're not 2 looking for a big broad amount of discovery. We're just trying 3 to figure out who the correct entities are and for them to show 4 us that it's not Lenovo Group and Lenovo Shanghai which we 5 continue to believe are the correct entities. 6 THE COURT: So if I understand correctly, the questions 7 you want resolved at this point are which Lenovo entity is 8 manufacturing, and then I would say fill in the 73 products 9 ish. 10 MR. HARRINGTON: Yeah. The manufacturing, designing, 11 shipping or importing. Kind of all the acts of infringement 12 and selling, right? So we're just -- who are the -- who the 13 entities that are doing the actual acts of infringement. 14 THE COURT: Are these -- and are the products that you're 15 talking about asking Lenovo about finished products as opposed 16 to like semiconductor chips or something like that? 17 MR. HARRINGTON: Yes, Your Honor. They're finished 18 products. 19 THE COURT: So put on the record -- for example, do you 20 have from your -- what you've sent to Lenovo can you give me 21 the name, for example, of a product or two just to put it into 22 perspective for me? 23 MR. HARRINGTON: So the ones that we were talking about 24 before were the tablet and the ThinkVision, but another example 25 would be there's a Chromebook laptop. So Chromebook S330 5 20 1 laptop. 2 THE COURT: And the deposition you would want to take 3 would be of someone from Lenovo, a corporate representative who 4 would be able to tell you with respect to each of the 5 identified products that you have given to counsel for Lenovo 6 with respect to each of those specifically identified products 7 which Lenovo entity designs them, which one manufactures them, 8 which one ships them and then I think you said importing. Do 9 you mean exporting or importing with respect to those or both? 10 MR. HARRINGTON: Importing or exporting. I think it's -- 11 it seems like -- yeah. Importing would be the -- I think would 12 be what we would be interested in. 13 THE COURT: Okay. Now if I can hear from counsel from 14 Lenovo. I've done my best if I were drafting this discovery 15 request to tailor it to what I think is relevant. What is 16 overly broad with having Lenovo identify for the plaintiff 17 those -- the entities who perform those four tasks on the 18 specific products? 19 MS. YIP: Your Honor, that discovery is precisely the 20 fishing expedition that we had discussed at the hearing would 21 be improper. And this whole notion of the correct entity that 22 Mr. Harrington had referred to, it's kind of a distraction 23 because the correct entity -- we know who the correct entity is 24 and we have already identified it. It's Lenovo United States, 25 and this whole dispute is really ultimately in the background 5 21 1 about venue. The only reason why the plaintiff is trying to 2 conduct this fishing expedition and to the so-called foreign 3 entity is because they do not want to face a venue challenge 4 because Lenovo U.S. is not properly in Texas after TC 5 Heartland. And so we fundamentally believe that the plaintiff 6 should not be allowed to conduct free ranging discovery into 7 which entities or which entity in -- foreign entity 8 manufactures or ships or does any of these things with respect 9 to the accused production, whether they are three products or 10 75 products. We cited in both our briefing as well as at the 11 hearing the Firefighters case which teaches us that 12 jurisdictional discovery should be limited to the named 13 defendant. Otherwise, as a matter of public policy, a 14 plaintiff will just sue any entity, any foreign entity and then 15 they will just bank on being able to conduct jurisdictional 16 discovery into which entity it should be, if not the one that 17 they picked. And so here we believe that that principle 18 should -- it's imminently appropriate to apply that here we 19 know who the correct entity is. It's Lenovo U.S. At the 20 hearing Your Honor had said plaintiff has two choices. It can 21 either sue Lenovo U.S. or it can go to China and depose a 22 witness to figure out whether these two named foreign entities 23 are appropriately in this case. And what plaintiff has done is 24 reject both of those choices and say that they want broad 25 discovery into any Lenovo entity that does any of these things 5 22 1 so that they can stay in Texas. And so fundamentally we 2 disagree that they are entitled to that. If they want, they 3 can go to China and depose a representative on the subject of 4 whether jurisdiction is proper over the named foreign entities. 5 In that respect we've made a proposal that -- this was the 6 subject of our e-mail correspondence -- about what topics would 7 be appropriate in that type of a deposition with that type of 8 scope. 9 THE COURT: Okay. Here's what I'm going to do. I'm going 10 to allow -- would you -- would one of you articulate the exact 11 names of the two Lenovo entities that we're discussing here? 12 MR. HARRINGTON: Zac Harrington. 13 MS. YIP: Your Honor, I'd be happy to do so. The first 14 Lenovo entity is Lenovo Group Limited and the second Lenovo 15 entity is Lenovo Shanghai Technology Company Limited. 16 THE COURT: And I'm sorry. Lenovo Group Limited and 17 Lenovo Shanghai Technology Limited are both foreign companies, 18 correct? 19 MS. YIP: Correct. And I have a slight correction to 20 make. It's Lenovo Shanghai Electronics Technology Company 21 Limited. 22 THE COURT: Okay. Here's what I'm going to do. I'm going 23 to allow the plaintiff to take depositions of the corporate 24 representatives of Lenovo Group Limited and Lenovo Shanghai 25 Electronics Technology Limited. With respect to the questions 5 23 1 of whether or not either of those entities is marketing, 2 designing, shipping or importing any of the 73 products, I'm -- 3 that number may not be right. Any of the products, whatever 4 number it is, that the plaintiffs have identified as infringing 5 products at this point they will be able to take the deposition 6 on those with respect to marketing, designing, shipping and 7 importing. I'm going to order the Lenovo defendants to produce 8 any documents that they need to use to prepare the witnesses, 9 the corporate witness in China of either Lenovo Group or Lenovo 10 Shanghai Electronics Technology Limited to be able to answer 11 those questions. 12 If when the plaintiff takes those depositions the witness 13 says something along the lines of, I don't know, I don't have 14 that information, I would -- I will probably be very unhappy 15 with that situation and we'll go from there. So I want the 16 witness -- I want the Lenovo witnesses to be fully prepared to 17 answer the questions on marketing, designing, shipping and 18 importing or exporting all of the identified accused products 19 and any documents that include sales contracts, shipping 20 contracts, production orders or anything else that the Lenovo 21 attorneys need to prepare the corporate representative for that 22 deposition. I want them to produce those to the plaintiffs in 23 advance of the deposition so that the deposition makes sense. 24 Is that -- I'll start with the plaintiff. Is that -- is 25 my order -- I'm not asking whether or not you're particular 5 24 1 happy with it. I'm asking is my order sufficiently clear for 2 you to understand what it is I'm telling you to do? 3 MR. HARRINGTON: Your Honor, Zac Harrington. Can I just 4 have one quick second to discuss? 5 THE COURT: Sure. 6 MR. HARRINGTON: Your Honor, Zac Harrington. So there was 7 two things that you said. One of them was you said marketing 8 but we had talked about manufacturing or making. 9 THE COURT: My law clerk pointed that out and I just -- I 10 just read my handwriting poorly. I meant to say manufacturing, 11 not marketing, and I was about to say that. 12 MR. HARRINGTON: Okay. And the other thing is the -- one 13 of the other things we mentioned was the sale. So, you know, 14 the -- their argument is is that the relevant company is the 15 Lenovo U.S. but those products are all sold to Lenovo U.S. by 16 another Lenovo entity. 17 THE COURT: I'll include sales there too. So to recap, it 18 would be manufacturing, sales, designing, shipping and 19 importing or exporting. That's what the -- 20 MR. HARRINGTON: Thank you, Your Honor. 21 THE COURT: That's what the corporate representatives of 22 Lenovo Group and Lenovo Shanghai Electronics Technology Limited 23 need to be prepared to testify about. The documents that the 24 plaintiff is entitled to are limited to the documents that the 25 Lenovo attorneys believe are necessary for the corporate 5 26 1 hearing you had requested that the Court -- the parties 2 complete the deposition within one month's time, and now of 3 course that month is -- the end of that month is quickly 4 approaching and so do you have some thoughts, Your Honor, on 5 the timing? 6 THE COURT: I do. Thank you again. You've asked better 7 questions than I provided guidance. I appreciate that. 8 I will order that the deposition take place within 9 three weeks after the counsel for Lenovo get the documents that 10 I've required be produced to plaintiff's counsel and verify 11 that that's all the documents that plaintiff's counsel need 12 pursuant to my order. So your -- by you I mean -- when 13 Lenovo's counsel sends to plaintiff's counsel the documents and 14 says, here's everything that we were ordered by the Court to 15 produce to prepare our corporate representative for your 16 deposition, the plaintiffs are on the clock to get the depo 17 done within three weeks unless -- let me make clear. If both 18 sides have an issue or there is some real issue I'm not aware 19 of, let me know. I'm not -- you know, if, you know, there's a 20 death in the family or your corporate representative can't do 21 it for some reason, it can be four weeks. I'm just saying 22 absent some real problem, I want the deposition to take place 23 within three weeks after certification by Lenovo's attorneys 24 that the plaintiff's counsel has all the documents they need. 25 And if you have trouble -- for example, I remember trying to 5 27 1 schedule these depositions. My recollection is you can't 2 really take them in China. They've got to be in Macau or Hong 3 Kong or someplace and you can't get a hotel to do them until 4 the 24th day in Hong Kong, that's fine with me. I don't want 5 y'all to be scrambling over that. 6 MS. YIP: Understood, Your Honor, and we appreciate that 7 very much. 8 One question -- further question of clarification. 9 THE COURT: Yes. 10 MS. YIP: In terms of the documents that we are -- the 11 documents to be produced, I can imagine that perhaps the 12 documents that might -- to prove a negative, let's say, that 13 Lenovo Shanghai or LGL do not do these things that some of the 14 documents might reflect, you know, which entity does which is 15 beyond the scope of the discovery that the Court had 16 authorized. And so in such a situation, would we be permitted 17 to redact the information showing which entity does these 18 things, the manufacturing of the sales and so forth? 19 THE COURT: No. I think if you've represented to me that 20 100 percent of this happens through Lenovo USA, my sense would 21 be that the -- that that's who it would be and so you shouldn't 22 need to redact that. You've already told me that Lenovo Group 23 and Lenovo Shanghai Electronics Technology don't belong here 24 because 100 percent of this happens through Lenovo USA which is 25 in a different state and I understand that venue issue. If 5 28 1 it's an entity other than Lenovo USA, then I'm going to allow 2 the plaintiffs to know who that is. But I'm not going to -- 3 I'm trying to be prescriptive in terms of the discovery. I 4 don't want you to have to go through every Lenovo entity to do 5 that. That's what I'm really trying to avoid here on behalf of 6 Lenovo, but the Lenovo entity witness, the corporate 7 representative for those two entities is going to have to be 8 able to say we don't do it and say who does. 9 MS. YIP: Understood. We understand, Your Honor. Thank 10 you. 11 THE COURT: Anything else from anyone? 12 Okay. Does -- 13 MR. HARRINGTON: That's all for plaintiffs, Your Honor. 14 THE COURT: And is there any reason now -- I'd rather know 15 now from either counsel. If you're anticipating for some 16 reason that I've set deadlines that will be unworkable for some 17 practical reason, now's the time to let me know. So... 18 MR. DAVIS: Your Honor, this is Stafford Davis for 19 American Patents. I just wanted to make sure I understood what 20 Ms. Yip was saying was that the Lenovo U.S. entity manufactures 21 these products abroad? 22 THE COURT: I don't -- are you asking me or you asking 23 her? If you're -- 24 MR. DAVIS: I was asking her just to understand the scope 25 of what she was representing to the Court. 5 29 1 MS. YIP: Mr. Davis, I wasn't making any representation to 2 the Court with respect to the manufacturing entity. All I was 3 saying is that the correct entity in this case is Lenovo U.S. 4 and requesting clarification as to the scope of the discovery 5 that would have to be produced in documentary form. 6 THE COURT: And that -- and this is Alan Albright. That's 7 the way I took it as well. But I would also say the way I 8 understand it is that the -- if -- from Lenovo counsel from her 9 argument which has been, you know, really outstanding so far is 10 that what we're going to learn is that Lenovo Group and Lenovo 11 Shanghai Electronics -- what we're going to get confirmation of 12 is that Lenovo Group and Lenovo Shanghai Electronics 13 Technologies Limited do not manufacture, sell, design, ship or 14 import any of the products that you have accused and then 15 that's performed by Lenovo U.S., and if that's the way the 16 depositions turn out, then, you know, I'll take up whatever 17 appropriate motions come as a result of that. 18 MR. DAVIS: Thank you, Your Honor. 19 THE COURT: Anything else from anyone? 20 MR. HARRINGTON: Nothing from American Patents. 21 THE COURT: Okay. I hope you guys have a great weekend, 22 and if I don't talk to you again, have a terrific 4th of July, 23 all. Take care. 24 (Hearing adjourned at 10:24 a.m.) 25