[00:00:01] Speaker 03:
I think we're ready to proceed, Ms.

[00:00:03] Speaker 03:
Pruitt.

[00:00:04] Speaker 02:
Thank you.

[00:00:05] Speaker 02:
Good morning, Your Honor.

[00:00:07] Speaker 02:
In a very strongly worded decision, the district court found this case exceptional under the prior and more restrictive Brooks Furniture Standard, and the court found it exceptional by clear and convincing evidence.

[00:00:20] Speaker 02:
This court has stated that the aim of Section 285 is to compensate a party for attorney's fees it should not have been forced to incur.

[00:00:29] Speaker 02:
Section 1927 is also aimed at compensation by shifting fees to attorneys.

[00:00:36] Speaker 03:
So what exactly is the standard of review here?

[00:00:38] Speaker 03:
I mean, she found exceptional.

[00:00:40] Speaker 03:
You're not challenging the finding of exceptional fees.

[00:00:43] Speaker 03:
So you're challenging just her subsequent decision as to how much or whether or not to award fees, right?

[00:00:51] Speaker 03:
And is that a piece of discretion?

[00:00:53] Speaker 02:
That is abusive discretion, Your Honor.

[00:00:55] Speaker 02:
After finding the case exceptional, after writing 19 pages detailing the extreme litigation misconduct that led her to find the case exceptional, and also laying out findings of facts that showed the case was completely unsupported from the start, that showed

[00:01:14] Speaker 02:
that the tactics reflected bad faith, she just declined to award any amount of fees.

[00:01:20] Speaker 03:
Well, she didn't.

[00:01:21] Speaker 03:
I mean, this isn't, as you heard in the earlier argument if you were here, in one of our instances on sanctions, there was no analysis by the court at all.

[00:01:28] Speaker 03:
In this instance, the court did point to several reasons why she didn't award fees, right, including that there might have been some

[00:01:37] Speaker 03:
questionable conduct on the other side, including that this could have ended sooner if Vizio had done more investigation or some action early on, right?

[00:01:46] Speaker 03:
I mean, am I wrong about that, that she did kind of point to reasons why she thought the award of fees would not be proper here?

[00:01:54] Speaker 02:
Well, let me be very clear about this.

[00:01:56] Speaker 02:
She did not identify any conduct by Vizio that was questionable.

[00:01:59] Speaker 04:
Oh, sure she did.

[00:02:01] Speaker 04:
She said the fact that Vizio basically sat

[00:02:04] Speaker 04:
on the fact that they weren't making the product for so long is part of what allowed the litigation to keep going on and may have actually, you know, been the same time frame in which some of this litigation misconduct was going on.

[00:02:16] Speaker 02:
Well, let me address that, Your Honor, and we do address this in our reply brief.

[00:02:19] Speaker 02:
First of all, that was incorrect.

[00:02:22] Speaker 02:
At the very first scheduling conference before Judge Felzer, I personally

[00:02:26] Speaker 02:
told Judge Valder and the court.

[00:02:28] Speaker 02:
After, Oakland's counsel said, in response to the court's question, Oakland's counsel said, we don't know whether these products are still on sale.

[00:02:36] Speaker 02:
But you know in the television industry, technology moves very quickly.

[00:02:40] Speaker 02:
New TVs every six months.

[00:02:42] Speaker 02:
That is in fact true.

[00:02:43] Speaker 02:
And if Oakland's counsel had looked at the Vizio website, they would have known that none of the televisions they accused were still on sale.

[00:02:51] Speaker 02:
But as soon as they said that, I responded, all of these products have changed.

[00:02:56] Speaker 02:
These are televisions from a few years ago.

[00:02:58] Speaker 02:
The district court forgot that.

[00:03:00] Speaker 02:
Opal's counsel took advantage of her mistake and glomming onto it in their opposing brief.

[00:03:06] Speaker 02:
But in fact,

[00:03:07] Speaker 02:
There are two things that are true about this.

[00:03:09] Speaker 02:
One, they absolutely knew those TVs had been discontinued, and two, we told them in July 2012.

[00:03:15] Speaker 04:
But that's an underlying factual finding, and there's nothing from the record other than what you're telling us, because I assume that that first conference was not on the record.

[00:03:23] Speaker 02:
It is in the record, and it's in the appendix.

[00:03:26] Speaker 02:
Yeah, it definitely is in the record.

[00:03:28] Speaker 02:
What cites the appendix into it?

[00:03:37] Speaker 02:
I think it's on page 14.

[00:03:41] Speaker 02:
Yes, on page 14 of our reply brief, we repeat the July 2012 portion of the transcript, where Oakwood's counsel states that... Is the transcript in the appendix?

[00:03:52] Speaker 02:
Yes, it is, Your Honor.

[00:03:54] Speaker 02:
Where?

[00:03:54] Speaker 02:
It's at A140.

[00:03:56] Speaker 02:
a one-fourth and that's a one fifty three there's two parts there's opal council's discussion where they say there's new TVs every six months we can't tell you that these TVs are still on sale and then there's my response which is on page fifteen of our reply brief where I confirm the products have changed because these are TVs from a few years ago but the trial court went beyond just that issue didn't the trial court say that

[00:04:24] Speaker 02:
that there were generally delays on both sides.

[00:04:28] Speaker 02:
The trial court said that, but without any explanation of how there were delays on both sides.

[00:04:34] Speaker 02:
The moment we end, the court acknowledges one of the problems that we have with the district court's decision.

[00:04:40] Speaker 02:
And I think this is apparent when you read it, is that she goes on for about 17 pages detailing all of the things that Opal's Senate Council did

[00:04:48] Speaker 02:
that they brought a baseless case, they never supported it with any evidence, they harassed Vizio in discovery, lost all three discovery motions that Vizio adequately made discovery, and she goes on and just repeats all of the things they did, making misrepresentations of law and fact to the court.

[00:05:06] Speaker 02:
The whack-a-mole expert strategy of just having different experts contradicting each other

[00:05:12] Speaker 02:
But then she turns around in the last few pages of the decision and starts contradicting her own factual findings.

[00:05:20] Speaker 02:
I mean, she's completely wrong.

[00:05:22] Speaker 03:
Well, she takes care of some of it.

[00:05:23] Speaker 03:
She says that with regard to the discovery stuff, you could have and did not file sanctions with regard to discovery, right?

[00:05:30] Speaker 02:
She says that, Your Honor, but as a matter of law, in cases that we have cited in our brief, we were not required to do discovery sanctions in order to be entitled to get sanctions under 285 or 1927.

[00:05:43] Speaker 02:
I believe this is articulated in the Octane Fitness case, that having a case that rises

[00:05:49] Speaker 02:
to the level, and previously in this court's Martek case, that having misconduct that rises to the level of a discovery sanction is not necessary.

[00:06:01] Speaker 02:
Although, I will say their conduct rose to the level of discovery sanction.

[00:06:05] Speaker 02:
We did choose at that time not to file a separate motion and seek fees on the discovery.

[00:06:11] Speaker 02:
But the entire course of conduct in this litigation shows that they filed this case without any basis.

[00:06:17] Speaker 02:
Both legally and factually.

[00:06:19] Speaker 02:
The trial court made a finding that the claims were not objectively based.

[00:06:23] Speaker 02:
The trial court made that conclusion.

[00:06:26] Speaker 02:
But if you look at the trial court's actual findings, she said the claims were utterly unsupported by any evidence.

[00:06:33] Speaker 02:
And let's just take for one moment indirect infringement.

[00:06:37] Speaker 02:
OPALIS filed a case where they first they sought past infringement.

[00:06:42] Speaker 02:
And they knew we had no knowledge of the patent.

[00:06:44] Speaker 02:
The vizio had no knowledge of the patent prior to the filing.

[00:06:47] Speaker 02:
of the case.

[00:06:48] Speaker 02:
So clearly that's not a proper claim.

[00:06:52] Speaker 02:
Even if you assume that they thought televisions were still on sale post-filing, Opus Council admitted repeatedly in the early stages of the case that they knew Vizio was not a manufacturer, they knew Vizio did not design or develop the televisions, that they didn't have any contact with the chipset makers and that in any event the chipset makers who sold chips to the original design manufacturers who made these TVs

[00:07:19] Speaker 02:
didn't disclose their proprietary video processing formulas that those were trade secrets.

[00:07:24] Speaker 02:
These are things they knew.

[00:07:26] Speaker 02:
So they knew the day they filed the complaint for indirect infringement that Vizio could not possibly have had the science to support either inducement of infringement or contributory infringement.

[00:07:38] Speaker 02:
They also knew that all of the claims in the patent were method claims.

[00:07:42] Speaker 02:
They sued Sears for reselling the televisions, they never alleged, and Sears was indemnified by Vizio.

[00:07:49] Speaker 02:
Sears was a customer.

[00:07:51] Speaker 02:
They sued Sears claiming that Sears sold the televisions without ever claiming that Sears used them, even though method claims can only be infringed by use.

[00:08:01] Speaker 02:
They sued Vizio for making and selling and importing TVs with method claims, and they had no evidence that Vizio used the TVs.

[00:08:09] Speaker 02:
Vizio is a reseller.

[00:08:10] Speaker 02:
of the TV.

[00:08:12] Speaker 02:
So even if you look at the legal arguments, the legal bases and you don't look at the factual bases that they didn't have,

[00:08:19] Speaker 02:
These were pretty frivolous claims right from the start.

[00:08:22] Speaker 02:
But then in the course of the litigation, they made no effort to find any evidence that supported infringement.

[00:08:29] Speaker 02:
All of their discovery, all of their efforts were devoted to finding more products to accuse and dollars and all kinds of sales information, which the district court ruled, given that these were use claims, was irrelevant, especially because the indirect infringement, there were no televisions on sale post filing of the complaint.

[00:08:49] Speaker 02:
So I think if you look at the entire picture of this case, it was an abuse of discretion for the district court not to award some amount of fees or all of the fees that Vizio asked for after making all of these findings in several page after page of the extreme litigation misconduct and findings of fact that went directly to the baselessness of the case.

[00:09:13] Speaker 02:
What the court said in the later part of the decision is, well, the allegations

[00:09:19] Speaker 02:
were reasonable.

[00:09:20] Speaker 02:
It was reasonable to base your allegations.

[00:09:24] Speaker 02:
That doesn't jive with the facts that she found.

[00:09:27] Speaker 02:
When you add to the equation of the erroneous assessment of the evidence, the fact that the district court at the hearing on this motion

[00:09:35] Speaker 02:
basically informed the parties that she was predisposed not to award fees.

[00:09:39] Speaker 02:
She said no less than four times during the hearing on attorney's fees, Mr. Nairo, didn't I tell you I just don't award fees?

[00:09:49] Speaker 02:
And this was all in response to Raymond Nairo's argument because he was arguing and she'd say, well, let me just stop you.

[00:09:57] Speaker 02:
I just don't give attorney's fees.

[00:09:59] Speaker 02:
So she was predisposed and reflected an inclination that no matter what findings she was going to make, she was simply not going to award fees.

[00:10:10] Speaker 02:
And we're dealing here, you know, and we put this in our brief and we submitted under Rule 28J, a recent decision in the intellect wireless case, we're dealing here with some very serious patterns in practice by the Niro firm in other cases that are identical

[00:10:26] Speaker 02:
to the case that is before this court on appeal.

[00:10:30] Speaker 05:
If 285 damages aren't meant to be punitive, but rather compensatory, is that really relevant?

[00:10:37] Speaker 05:
Well, I mean, it's certainly relevant to making them look like unprofessional bad lawyers, but that's what she said actually expressly.

[00:10:43] Speaker 05:
I'm not paraphrasing.

[00:10:44] Speaker 05:
That's what she said.

[00:10:45] Speaker 05:
Unprofessional multiple times.

[00:10:47] Speaker 05:
So how is the fact that they were sanctioned in another case

[00:10:51] Speaker 05:
relevant to whether they should be here.

[00:10:53] Speaker 02:
Well, I think it shows support for what the district court found on litigation misconduct.

[00:10:58] Speaker 02:
Under Section 285, litigation misconduct under the Optane Fitness case is independently a ground for finding exceptional case under 285 and for sanctioning a party under Section 285.

[00:11:12] Speaker 04:
And what is the additional cost that were incurred because of the litigation misconduct that was identified?

[00:11:18] Speaker 02:
Well, first of all, from the start, we believe that the costs for the entire case were the result of litigation misconduct.

[00:11:25] Speaker 02:
As the court pointed out, right from the start, their infringement contentions were just a complete morass.

[00:11:31] Speaker 02:
They made no sense at all.

[00:11:34] Speaker 02:
No pre-filing investigation.

[00:11:35] Speaker 04:
If you could have filed an earlier summary judgment motion, couldn't you have, based on the absence of the selling?

[00:11:41] Speaker 02:
Well, there were two things.

[00:11:44] Speaker 02:
There were two things on that.

[00:11:45] Speaker 02:
First of all, we do file very early summary judgment motions just on the patent and based on their own allegations that the patents were indefinite and under section 101 invalid.

[00:11:56] Speaker 02:
Based on testimony they gave through an expert that they later repudiated, the court denied that motion.

[00:12:02] Speaker 02:
The first thing we did when we got the infringement contentions was to send a 12 page single space letter to opal's council saying, we have a problem with this.

[00:12:10] Speaker 02:
We don't understand what your basis for infringement is.

[00:12:13] Speaker 02:
You have techniques in the prior art, that's all you've asserted.

[00:12:17] Speaker 02:
You've got piles and piles of video processing chips that are all different.

[00:12:21] Speaker 02:
that you're claiming, can you clarify this?

[00:12:24] Speaker 02:
And they came back to us and said, well, we have to get discovery from Vizio.

[00:12:28] Speaker 02:
And we said, well, Vizio doesn't have that discovery.

[00:12:31] Speaker 02:
They knew all this.

[00:12:33] Speaker 02:
They had had a prior case, and that's in the record against Vizio.

[00:12:36] Speaker 02:
They knew that Vizio is a reseller and doesn't make the product, doesn't order the chips or deal with the chip makers.

[00:12:43] Speaker 02:
But they just insisted that while we can't, you know, we have to go forward with discovery.

[00:12:48] Speaker 02:
That's what resulted in the first discovery motion and the court denying that motion, ordering them to file amended infringement contentions, which they did not do.

[00:12:57] Speaker 02:
even when the court ordered it.

[00:12:58] Speaker 02:
They didn't do it, but then a month later in June 2013, they filed infringement contention, again accusing, after they knew they were discontinued now, the same discontinued television and adding four more discontinued televisions.

[00:13:14] Speaker 02:
filed by an expert report a month later that made all the same legal infirmities that we mentioned.

[00:13:20] Speaker 03:
You're into your rebuttal time, so I assume you want to keep some of it.

[00:13:24] Speaker 03:
I do.

[00:13:25] Speaker 03:
So why don't we hear from the other side.

[00:13:26] Speaker 03:
Thank you.

[00:13:33] Speaker 01:
Thank you.

[00:13:37] Speaker 01:
Chief Judge Frost, please report.

[00:13:40] Speaker 01:
But the district court's decision not to award fees is not based on a personal mandate.

[00:13:46] Speaker 01:
Rather, the district court correctly understood that 285 is remedial and for the purpose of compensating the prevailing party, where it would grossly unjust to require it to bear its own costs.

[00:13:56] Speaker 01:
And as this court said, the aim is not to punish the plaintiff.

[00:14:00] Speaker 01:
What the district court did was wait all the evidence after reviewing the entire course of the conduct through the trial.

[00:14:06] Speaker 03:
You've got to admit, reading her opinion, you almost feel like you're reading a book and you feel like it's going to come out one way and then suddenly there's the reverse.

[00:14:14] Speaker 03:
fun chapter, right?

[00:14:15] Speaker 03:
This was pretty extreme.

[00:14:19] Speaker 03:
And her findings and her observations with regard to that conduct were pointing in the other direction, right?

[00:14:26] Speaker 01:
I'll make two comments to that.

[00:14:27] Speaker 01:
First, I want to make very clear during this appeal, O plus does not challenge any finding by the district court.

[00:14:34] Speaker 01:
So we're not challenging any single thing that she said.

[00:14:37] Speaker 01:
So taking that aside, and I agree that there are points of error.

[00:14:42] Speaker 05:
Taking that aside, it makes sense that she would have to spend so much time detailing the... Well then if she said, if you're not challenging it, and in 835 she says, Oh, plus unquestionably pursuit of vexious and harassing litigation strategy.

[00:14:56] Speaker 05:
How does... That's pretty bad stuff.

[00:14:59] Speaker 05:
How does that not cost them more money?

[00:15:01] Speaker 05:
I mean, maybe they don't get the whole suit.

[00:15:03] Speaker 05:
But if she is finding, as a matter of fact, they pursued a vexious and harassing litigation strategy, how could that not have resulted in them having to spend more money into that?

[00:15:13] Speaker 01:
The reason that that makes sense is because she took a look at all of the evidence.

[00:15:17] Speaker 01:
She didn't just take a look at simply the bad things that happened.

[00:15:21] Speaker 01:
She also made other specific findings.

[00:15:23] Speaker 01:
for example, that this case has been fraught with delays and avoidance tactics to some degree on both sides.

[00:15:29] Speaker 05:
And what in the record would support precisely that fact-finding?

[00:15:34] Speaker 01:
The one point that is specifically referenced by the district court judge on A33

[00:15:40] Speaker 01:
is that video itself did not make the court aware of the fact that the TVs were discontinued.

[00:15:45] Speaker 05:
Except that she did in July 24th of 2012, and the case was only transferred to ND Cal in June of 2012.

[00:15:53] Speaker 05:
So she did expressly make the court aware.

[00:15:56] Speaker 05:
So I don't see how that fact-finding actually is supported by the evidence.

[00:16:00] Speaker 01:
I would disagree with you, Your Honor, that I believe that the statement that was found on A141

[00:16:05] Speaker 01:
is somewhat ambiguous.

[00:16:07] Speaker 01:
The reason it's ambiguous.

[00:16:08] Speaker 05:
What statement?

[00:16:09] Speaker 05:
Let me get to it.

[00:16:10] Speaker 05:
A what?

[00:16:10] Speaker 01:
A 141.

[00:16:11] Speaker 01:
This is the statement the Council for Visio pointed to you to.

[00:16:25] Speaker 04:
The reference to the product evolving?

[00:16:28] Speaker 01:
Yes, that's right.

[00:16:29] Speaker 05:
What about the statement on page 153?

[00:16:31] Speaker 05:
I think she also expressly said 153 because that's what I wrote down.

[00:16:35] Speaker 05:
online twenty nine where she said but the product that changed because these are TV's from a few years ago.

[00:16:41] Speaker 01:
That's correct.

[00:16:42] Speaker 01:
The TV models themselves changed but the key here is that the things that were being accused

[00:16:48] Speaker 01:
were models of TVs that incorporated the HQV, the DCOTD, and the NDD chipsets.

[00:16:56] Speaker 01:
And so yes, it is true that the model numbers did change, but the belief on the part of OPOS was that there were continuing to be sold models of televisions that contained such chips even after the lawsuit.

[00:17:09] Speaker 01:
Furthermore, if I can direct the court to A5560, in Vizio's own words, sometime after this point, they did not point you to the July statement.

[00:17:21] Speaker 01:
Rather, they say at A5560, quote, moreover, Vizio informed OPLUS well prior to OPLUS amending its infringement contention in April 2013 that none of the television models OPLUS accused were on sale.

[00:17:37] Speaker 05:
the fact that they informed them in April 2013 didn't mean they also said something in June of 2014, right?

[00:17:45] Speaker 05:
Those are not mutually exclusive statements.

[00:17:47] Speaker 01:
No, but what I'm suggesting, however, is that there was factual basis for the district court's finding that there was delay by

[00:17:53] Speaker 01:
by Vizio in providing the information that could have resolved the lawsuit at an earlier point in time.

[00:17:59] Speaker 04:
Why doesn't the fact that the Supreme Court has now told us that the standard that the trial court was applying in this case was an incorrect one?

[00:18:08] Speaker 04:
Why isn't that enough for us to just remand the case back to the trial court to consider

[00:18:14] Speaker 04:
the matter anew under the appropriate standards.

[00:18:18] Speaker 01:
The reason why I think that would not be appropriate in this case, Your Honor, is because this Court has long held before the Supreme Court's decision that the exceptional case questions in this two-step process.

[00:18:30] Speaker 01:
The first question is to determine whether or not the case is exceptional under 285.

[00:18:34] Speaker 01:
And then, after making that determination, separately assess whether or not, in a substantial judgment, the district court believes that the case should have fees awarded.

[00:18:47] Speaker 01:
And that question, that second prong, has always been assessed under an abusive discretion standard by this court.

[00:18:53] Speaker 01:
So therefore, because the court had already found this case was exceptional under 285 and then started to apply the second prong,

[00:19:02] Speaker 01:
There's no change in law that applies to that second problem that we require right now.

[00:19:06] Speaker 04:
Well, there is a whole question about the, you know, she found that the allegations when made, that they weren't objectively baseless when made.

[00:19:17] Speaker 04:
But under the new standard, under 285, she could take into consideration a totality of circumstances that would include the weakness of the claims.

[00:19:25] Speaker 04:
And that's something that she didn't consider because she didn't think she could consider it once she made the non-objectively baseless determination.

[00:19:34] Speaker 01:
Well, there's no place, I would submit, in her opinion that says, I cannot award attorneys fees based upon the witness' claim.

[00:19:41] Speaker 01:
She doesn't say that.

[00:19:42] Speaker 01:
What she says is, on page 834, since this court deems this case exceptional due to O Plus's litigation misconduct,

[00:19:50] Speaker 01:
The court must determine in its discretion if an award of fees is appropriate in the amount of the award.

[00:19:55] Speaker 01:
She then went through and did that.

[00:19:56] Speaker 04:
But she didn't have the benefit of knowing that she could consider the totality of all of the circumstances.

[00:20:03] Speaker 04:
I'm not saying she wouldn't come out the same way, but if this court has repeatedly been remanding

[00:20:08] Speaker 04:
a 285 determinations that were made under the improper standards so the trial court can do it and exercise their discretion under the correct law.

[00:20:18] Speaker 04:
Why isn't that the same thing that we should do here?

[00:20:21] Speaker 01:
Because in exercising her discretion as to determining whether or not towards these after finding the case exceptional

[00:20:27] Speaker 01:
she looked at the entire record.

[00:20:28] Speaker 01:
So she didn't just have the benefit of Highmark or anything else.

[00:20:32] Speaker 01:
What she had was the benefit of spending two years with the case, which is exactly why the Highmark decision is relevant.

[00:20:41] Speaker 01:
It says,

[00:20:43] Speaker 01:
The district court is best positioned to decide whether a case is exceptional because it lives with the case of a prolonged period of time.

[00:20:49] Speaker 01:
She saw all the facts that go into this determination.

[00:20:53] Speaker 05:
What about the four instances where she said, I don't award fees?

[00:20:56] Speaker 05:
I mean, one time she said the equivalent of, but you're making me want to.

[00:20:59] Speaker 05:
It's kind of like when I turn to my kids and say, don't make me do this.

[00:21:04] Speaker 05:
Why isn't that sort of a problem?

[00:21:09] Speaker 05:
Given that I've just never seen an opinion that from start to finish lays out more unprofessional behavior in every possible dimension.

[00:21:22] Speaker 05:
from breaching a potential protective order in another case by using confidential information here, where she said they strained credibility to say they didn't do so, her words, strained credibility, not good, to them calling her a rogue in open court, to the whack-a-mole experts, to the, I mean, gosh, I said to my clerk, you'll get a kick out of this, just prepare me a list, if you wouldn't, a bullet point of all of her sort of strong adjectives.

[00:21:48] Speaker 05:
It's four pages long.

[00:21:52] Speaker 05:
I mean it's single face 12.5 to be clear.

[00:21:55] Speaker 05:
I mean she just thought they flouted every dimension of professional behavior from start to finish and it got worse as the case moved forward.

[00:22:05] Speaker 05:
Given all of that and then when she says but I just don't award fees four times I'm having a little difficulty thinking that she was really

[00:22:15] Speaker 05:
open to understanding the notions of what an exceptional case 285 analysis should be.

[00:22:22] Speaker 01:
I understand the concern and I also have to say that yes it's true that those adjectives should give us pause.

[00:22:32] Speaker 01:
They clearly gave her pause and still she declined award fees.

[00:22:36] Speaker 01:
What she said though specifically on page A505 is while she doesn't award fees generally, I might in this case

[00:22:44] Speaker 05:
You know, I never have stopped the car, of course, but don't make me stop this car.

[00:22:51] Speaker 05:
I mean, that's kind of...

[00:22:53] Speaker 05:
You know, I think she was trying to give him warning, but it didn't get any better after that.

[00:22:56] Speaker 05:
It kept going.

[00:22:57] Speaker 05:
And that wasn't the last statement either.

[00:22:59] Speaker 05:
After that, she said, after that, I don't award fees, no longer with the caveat.

[00:23:04] Speaker 01:
Although the records said she has awarded fees in at least two cases.

[00:23:09] Speaker 01:
And she's an extremely experienced district court judge.

[00:23:12] Speaker 01:
She had seen this before.

[00:23:13] Speaker 01:
She has awarded fees before.

[00:23:15] Speaker 01:
She said that her mind was

[00:23:17] Speaker 01:
I haven't made my mind up yet.

[00:23:18] Speaker 05:
The last time she awarded fees was 2007.

[00:23:21] Speaker 05:
It's now 2015.

[00:23:23] Speaker 05:
Isn't it possible that we should accept her statement in this case that I don't award fees?

[00:23:26] Speaker 05:
She didn't say I never award fees.

[00:23:28] Speaker 05:
She said I don't award fees.

[00:23:29] Speaker 05:
Maybe she's adopted a new position post-2007 of no fees anymore.

[00:23:33] Speaker 05:
And perhaps it's because she has seen so much bad conduct that she's a little bit uninterested in sanctioning any one person.

[00:23:43] Speaker 05:
I don't know, but she laid out

[00:23:45] Speaker 05:
opinion here, a very experienced judge has never, she's never written an opinion like this in her career and look at what she articulates and when you combine that with a very experienced judge saying I don't award fees, I don't know, it's hard to reconcile.

[00:24:01] Speaker 01:
I understand and the reason why I think it makes sense for her to have written so much is because she felt the need, rightfully so, to detail all misconduct

[00:24:11] Speaker 01:
If she had written it as a, well, there's some bad stuff here, bad stuff there in the first portion of the section, it would not have strongly supported the 285 finding of exceptional case, which we're not disputing in this point.

[00:24:26] Speaker 01:
But once she's gotten past the point of detailing and laying out all of those issues, then she says, well, taking a look at everything, including looking at the fact that the case is fraught with delays and avoiding some tactics on both sides.

[00:24:40] Speaker 05:
Yeah, but you haven't given me anything in the record to support that.

[00:24:44] Speaker 05:
I've got a review of fact-finding for clear error.

[00:24:47] Speaker 05:
What else, apart from what you've already pointed me to, exhibits Vizio's delays?

[00:24:52] Speaker 01:
The other delays would include, for example, the lack of providing discovery.

[00:25:00] Speaker 01:
Wait, no, no.

[00:25:01] Speaker 05:
She found all of the discovery they failed to provide was because your discovery requests were either improper, already have been rejected, or too confusing and ambiguous to understand.

[00:25:11] Speaker 05:
So not one of your discovery requests that they didn't answer, did she fault them for not answering?

[00:25:16] Speaker 01:
That's quite right.

[00:25:17] Speaker 01:
Ultimately, in the day.

[00:25:18] Speaker 01:
But she also found that the two

[00:25:21] Speaker 01:
the two discovery requests were substantially justified as well.

[00:25:27] Speaker 01:
And so there is a balance, I have to say, in the question of whether or not, yes, were they bad and proper?

[00:25:34] Speaker 01:
Were they ill-timed, as you said?

[00:25:37] Speaker 01:
burden some ill-timed and ambiguous.

[00:25:40] Speaker 01:
Something to that effect.

[00:25:41] Speaker 01:
Right, exactly.

[00:25:41] Speaker 05:
But on the other hand, she's also saying that... So you're going to fault them for not responding to a discovery request that she herself said were ill-timed, burdensome, and ambiguous.

[00:25:50] Speaker 05:
And she didn't fault them for not responding in any way.

[00:25:52] Speaker 01:
That's right.

[00:25:53] Speaker 01:
And then the second delay would also obviously be

[00:25:57] Speaker 01:
the delay between the beginning of the case and the final summary judgment motion that came two years later.

[00:26:04] Speaker 05:
Well, hold on, no.

[00:26:05] Speaker 05:
They filed a summary judgment motion early on, and you had the expert that came in and said something, which quite reasonably, if I was this judge, would have caused me pause in granting summary judgment.

[00:26:15] Speaker 05:
But then it turned out that whole thing wasn't true.

[00:26:18] Speaker 01:
The video lost both of the summary judgment motions that were brought in initially.

[00:26:24] Speaker 01:
well possibly because of all the life there there there is no evidence that the the the issues of the first two summer judgment motions is a one-on-one one twelve uh... motion and in those instances there was not allegations that someone specifically live uh... and us

[00:26:43] Speaker 01:
So what happened was there were those two motions, the ones that Vizio brought and lost initially.

[00:26:49] Speaker 01:
It took quite some time before it finally brought a summary judgment motion that it won on.

[00:26:54] Speaker 01:
And so there was a substantial amount of time that accrued between those two events.

[00:26:58] Speaker 01:
And to say that, and I think that again, while you may disagree or this court may say I would have come to a different decision, I think that the way

[00:27:09] Speaker 01:
at least supports the district court's decision or finding a fact that the case was fraught with delays in avoidance tactics to some degree on both sides.

[00:27:19] Speaker 05:
Now what about the fact that when they filed summary judgment of 90, the plaintiff's oppositional summary judgment motion didn't even address all the claim limitations, not even all the ones they expressed to the site and said they don't infringe.

[00:27:33] Speaker 05:
Doesn't that make the whole thing frivolous right there?

[00:27:36] Speaker 05:
Forget about the whole case.

[00:27:37] Speaker 05:
Isn't at least that little component frivolous?

[00:27:40] Speaker 05:
If I say summary judgment and here are the five reasons I'm entitled to it, and you don't respond to three of those reasons,

[00:27:45] Speaker 05:
Isn't it a problem when the case keeps going forward at that point?

[00:27:48] Speaker 05:
Isn't your response on it face frivolous?

[00:27:51] Speaker 05:
Well, first of the national matter, the district court specifically found no single filing was clearly frivolous or employed with the purpose of... But she also expressly found that in opposition to the summary judgment of non-infringement, they didn't even respond to multiple of the non-infringement contentions.

[00:28:06] Speaker 01:
Yes, that's true.

[00:28:07] Speaker 01:
That's true.

[00:28:07] Speaker 05:
So, well, I can, frivolity of a pleading under those circumstances, that seems like a clear question of law.

[00:28:13] Speaker 05:
You can't sign in favor of them on summary judgment in that circumstance.

[00:28:18] Speaker 05:
It's not possible.

[00:28:19] Speaker 01:
Well, if we back up to what they, so we go to the district court summary judgment opinion.

[00:28:23] Speaker 05:
That's what I'm saying when she said no single filing was frivolous.

[00:28:26] Speaker 05:
I'm having a little difficulty understanding how the summary judgment

[00:28:30] Speaker 05:
doesn't directly contradict that.

[00:28:32] Speaker 01:
Well, the reason being is if you go to the district court summary judgment opinion on non-infringement, you will find that there are three basics for finding non-infringement.

[00:28:42] Speaker 01:
One is that there was no information that or there was no evidence that Vizio used the product in the United States.

[00:28:50] Speaker 01:
Second, there was no evidence that Vizio

[00:28:53] Speaker 01:
induced others because it had any knowledge or that it sold the television to the appropriate complaint.

[00:28:58] Speaker 01:
The summary judgment opinion does not go through in detail the whether or not specific elements are or are not met.

[00:29:06] Speaker 05:
It's actually a quite short opinion because there was no, once you get to the place of... The fact that she pointed it out in the attorney's fees context but didn't point it out in that motion, somehow I should just turn a blind eye.

[00:29:21] Speaker 05:
They, I looked at the summary judgment, they didn't address multiple of the contention.

[00:29:27] Speaker 05:
I mean, isn't your understanding of the way the legal process works, that if you fail to rebut something, it is accepted?

[00:29:32] Speaker 05:
Is that not your understanding of the legal process?

[00:29:35] Speaker 01:
That seems appropriate, Your Honor.

[00:29:37] Speaker 05:
I would just simply say that she did not find that... No, she did find they failed to rebut them, expressly said so in this opinion.

[00:29:44] Speaker 01:
Right, right.

[00:29:45] Speaker 01:
But she did not find them to be frivolous.

[00:29:48] Speaker 01:
And in fact, she did not face her decision on that either in her summer judgment.

[00:29:52] Speaker 05:
You tell me.

[00:29:52] Speaker 05:
Seriously, I mean, can you stand there and tell me.

[00:29:57] Speaker 05:
that if you fail to rebut the argument about which you have to rebut or else you lose, that your opposition is not frivolous at that point, can you honestly forget about what she held or didn't hold?

[00:30:10] Speaker 05:
Can you tell me that you would conclude it's not frivolous if you expressly don't address their argument, each one of which on their face caused you to lose?

[00:30:19] Speaker 01:
I would not do so, Your Honor.

[00:30:21] Speaker 05:
Was it frivolous not to?

[00:30:23] Speaker 05:
Was it frivolous to file a pleading under those circumstances under which you cannot prevail?

[00:30:29] Speaker 01:
The district court found not and I'm supporting the district court's position and I believe that it's

[00:30:34] Speaker 01:
It's appropriate to do so because of the fact that she did, in fact, not base her decision upon that.

[00:30:40] Speaker 01:
She based her decision upon several other things.

[00:30:43] Speaker 01:
Would I have done what was done in opposition to some re-judgment?

[00:30:47] Speaker 01:
No.

[00:30:48] Speaker 01:
But that was not my decision to make.

[00:30:50] Speaker 01:
Respectfully, that was the decision for the district court to make.

[00:31:04] Speaker 02:
First of all, at the appendix at page 59 and 60 and throughout the district court found throughout that Vizio had adequately made discovery that there were no televisions on sale after the filing of the complaint.

[00:31:21] Speaker 02:
And notwithstanding a lot of the arguments that had just been made, she did find in the summary judgment opinion that they did not show any use by Vizio of the patented

[00:31:31] Speaker 02:
I mean, apart from just turning on the television to see if the picture was clear before sending it out to customers.

[00:31:40] Speaker 02:
I'd like to address the remand issue because I believe that the Brooks Furniture Standard really did, in fact, her decision not to award fees after finding the case exceptional.

[00:31:49] Speaker 02:
She focuses on some things that are no longer the law under Octane Fitness, such as the objective baselessness and subjective bad faith, always very difficult things to find.

[00:32:01] Speaker 02:
And, you know, she did point out, there's a quote, I think it's at A35 and 36 of the appendix that, quote, Oprah's pursued a weak case in a manner that was overly aggressive, uncooperative, and outside the bounds of professional behavior.

[00:32:19] Speaker 02:
I believe this case is the epitome of the Octane fitness standard.

[00:32:23] Speaker 02:
It stands out from others with respect to both the substantive strength of the party's litigation position based on the facts in the governing law and the unreasonable manner in which the case was

[00:32:35] Speaker 04:
My biggest problem with your position is that you knew even before you put the court through a Markman hearing that the model numbers that were identified in the complaint were not being sold.

[00:32:45] Speaker 02:
Well, we told the court that.

[00:32:47] Speaker 04:
Well, you didn't.

[00:32:49] Speaker 04:
What you showed us is not really saying these model numbers that are identified in the complaint are not being sold.

[00:32:56] Speaker 04:
You just said the products have evolved, the products have changed.

[00:32:59] Speaker 04:
But you didn't say we're not selling these.

[00:33:01] Speaker 04:
Yes, you've got new products too, but you never actually said these specific model numbers, we're not selling anymore.

[00:33:08] Speaker 04:
And it wasn't until after the Markman hearing, after you've gone through an earlier summary judgment on different standards,

[00:33:14] Speaker 04:
You then finally say, oh, yeah, and by the way.

[00:33:17] Speaker 02:
Well, no, it was well before that.

[00:33:18] Speaker 02:
I mean, in April 13, we answered interrogatories to the other side.

[00:33:22] Speaker 02:
Now, the court may not have known about that, but we answered interrogatories.

[00:33:26] Speaker 02:
It didn't change Opalis' behavior.

[00:33:28] Speaker 02:
They continued to assert.

[00:33:29] Speaker 02:
I mean, when the court asked them to do amended infringement contentions,

[00:33:33] Speaker 02:
That was two months after April 13th.

[00:33:35] Speaker 02:
It was in June 2013.

[00:33:37] Speaker 02:
And they still accused the same discontinued television.

[00:33:40] Speaker 02:
So it didn't affect their behavior.

[00:33:41] Speaker 04:
So why hadn't you filed your summary judgment before that to actually say they were discontinued?

[00:33:45] Speaker 02:
Well, I will tell you exactly the problem, Your Honor.

[00:33:48] Speaker 02:
We were dealing with a moving target on infringement contentions and a 50-60 problem because opposing counsel insisted we've got to have discovery.

[00:33:58] Speaker 02:
We told them, even as we were objecting and making discovery and they were saying, but these documents don't give us any technical information, we were telling them, well you know and you've already admitted that we don't have it, you need to go to the chip makers.

[00:34:13] Speaker 04:
So file your motion and let them request discovery under 5060.

[00:34:18] Speaker 04:
And you could have said you don't need it because these model numbers are not being held.

[00:34:21] Speaker 02:
Well, we were in the process.

[00:34:22] Speaker 02:
I mean, there were things happening in the case.

[00:34:24] Speaker 02:
There was a discovery motion brought by Oakland.

[00:34:27] Speaker 02:
It was a motion that was denied and had them

[00:34:29] Speaker 02:
ignore the court's order and turn around and subpoena themselves for sales and product information, their whole thrust in this case was let's find more products to accuse, let's get some big damages numbers and let's just skip right over liability, which the court acknowledges in her decision.

[00:34:46] Speaker 02:
She's really pretty much flat out says.

[00:34:50] Speaker 02:
that all they were interested in was how big is this case?

[00:34:52] Speaker 02:
How big can we make this case?

[00:34:54] Speaker 02:
And they sort of forgot to take any discovery relating to infringement.

[00:34:58] Speaker 02:
MediaTek offered to give them source code.

[00:35:00] Speaker 02:
If they would sign a confidentiality order, they refused to do it.

[00:35:04] Speaker 02:
The other two chip makers are in the US, Qualcomm and STMicro.

[00:35:09] Speaker 02:
They objected.

[00:35:10] Speaker 02:
They wanted a confidentiality order.

[00:35:12] Speaker 02:
Opalus refused to give them one.

[00:35:15] Speaker 02:
And we couldn't get the information either.

[00:35:18] Speaker 02:
We felt it was their burden.

[00:35:19] Speaker 02:
to prove infringement under the law, and not our burden to prove non-infringement, which they continue to try to shift to us throughout the entire case.

[00:35:30] Speaker 03:
Could we have your argument?

[00:35:31] Speaker 03:
We think I'll come to the case to submit it, and that concludes our proceedings for this morning.

[00:35:36] Speaker 03:
All rise.

[00:35:39] Speaker 03:
The honorable court is adjourned from day to day.