[00:00:48] Speaker 02:
A final case this morning is GenBand U.S.

[00:00:51] Speaker 02:
versus MetaSwitch Networks 2017-11-48.

[00:00:58] Speaker 02:
Good morning, Mr. Cabale.

[00:01:03] Speaker 00:
Cabale, Your Honor.

[00:01:04] Speaker 00:
Good morning.

[00:01:20] Speaker 00:
May it please the court, my name is Doug Cabale.

[00:01:23] Speaker 00:
I represent the patent holder GenBand.

[00:01:26] Speaker 00:
Your honor, affirming the district court's denial of an injunction in this case based on the record that we have in this case would require a significant change in law.

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It's undisputed in this case that GenBand and Metaswitch are direct competitors.

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And in fact, since 2013, they've been fierce competitors for the sale of a platform of networking equipment

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that's been found to infringe seven different GenBand patents.

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In the injunction hearing below, the district court heard evidence of the direct connection between Metaswitch's use of the patented technology and the customer demand for that technology.

[00:02:08] Speaker 00:
They heard from Metaswitch's CEO, who testified under cross-examination, that

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all of the features are actually things that customers are asking for.

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That's in the record at 2066.

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He testified that Metaswitch chose to invest in those features because customers wanted them.

[00:02:30] Speaker 04:
There's some ambiguity about what he meant by all those features, right?

[00:02:35] Speaker 04:
You could have been talking about the very patented technology that they appropriated or it could be maybe that and a bunch of other features.

[00:02:45] Speaker 00:
If your honor looks at the actual testimony in the record, I think the record is clear.

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He was asked the direct question, are the patented features important?

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He says, well, all those features are actually things customers are asking for.

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He's asked again, let me ask you again, are the patented features important or not?

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He says, we chose to invest in those features because customers wanted them.

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Now, my colleagues in their brief try to explain away that testimony by saying, well, he's only talking about the features that are actually advertised by MetaSwitch.

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And these are among the main features that MetaSwitch advertise.

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Even if you take all the features that are advertised as ones that customers are actually asking for and ones that customers want, the admission is that these are on that list.

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These are part of what customers are asking for.

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part of what customers want.

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And as their head of sales says at page 2076, the customers find these features to be important.

[00:03:48] Speaker 03:
Was the testimony you were just discussing part of what the district court referred to in conclusion of law number six on page?

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It's not.

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It's not.

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In conclusion of law number six, the court

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recites verbatim basically an argument that MettaSwitch made in its post-trial brief mischaracterizing the evidence that was provided to the district court.

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He does not have any discussion of the testimony from the CEO or the testimony from the head of sales or the testimony from MettaSwitch's own damages expert saying that the 561 patent gave MettaSwitch a competitive advantage in its sales or the testimony from, I should say,

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internal documents from Metaswitch sales team saying that the 561 patent was a key selling point for them.

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That's at A1636.

[00:04:45] Speaker 04:
He doesn't have any... Yeah, and I get it that there are a number of items that you've identified in your briefing that are not called out in the judge's opinion or items that could barely

[00:05:05] Speaker 04:
fall into the three general categories he's identified.

[00:05:09] Speaker 04:
I guess what I'm wondering is for a discretionary ruling like granting or denying an injunction, what is our case law require in terms of to what degree does the district court decision have to go line by line, dime by dime through every single possible

[00:05:35] Speaker 04:
proposed argument and proposed fact finding?

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Sure.

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Your Honor, this court's president holds that at a minimum under Rule 52A, the district court was required to give an explanation of the reasons for denying the injunction.

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What we have here is the conclusion of law number seven, where the court simply found there was no finding, simply concluded that GenBan's presentation of evidence did not satisfy its burden of causal nexus.

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Conclusion of law number six before that is, again, a recitation

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from Metaswitch's post-trial brief that identifies three buckets of evidence that were presented under Metaswitch's view, but ignores significant parts of the record.

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And the way the record is, looking at the fullness of this record and the testimony that we have showing that there is direct evidence that customers were asking for these features, that they were giving a competitive advantage to Metaswitch, that

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customers were paying extra specifically for the patented features, customer survey evidence showing customers found this to be important.

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All of that evidence more than satisfies this court's standard in the Apple IV case, which is that GenBand's burden is to show that there is some connection between the infringement and the harm.

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What the district court did in this case, and it announced it in its conclusion of law number four, was it was applying a standard saying that GenBand had to prove

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that the patented features drove demand for the products.

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And in light of the evidence that we have that was presented, the only way that the court could get there was to say- That's a quote from our own case law.

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It is a quote, but that quote has been explained.

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In Apple IV, that quote was explained.

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And in fact, the district court did the same thing in Apple IV, that this court

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this district court did.

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And in the district court in Apple III.

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Well, in fact, it was explained in Apple III.

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Some connection language comes from Apple III.

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And the district court here did, while not referencing that portion of Apple III, did cite Apple III.

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It did cite Apple III.

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The portions that the district court used for the drives demand came from Apple I and Apple II.

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This court's decisions in Apple III and Apple IV

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go on to clarify that if the way you're applying the drive demand standard is to require that it's the sole or the primary basis for the demand, then that's an error of law.

[00:08:05] Speaker 04:
You have to show that there's some connection between the infringement and the... How do we know that the lower court judge here was necessarily thinking that

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you had to prove that these products were the sole, these patented technologies were the sole reason for the customers purchasing of the Fringer's products.

[00:08:29] Speaker 00:
Sure.

[00:08:30] Speaker 00:
Judge Chen, we know that because when we look at conclusion of law number seven, the judge says that GenBan's presentation of evidence doesn't satisfy GenBan's burden of showing causal nexus.

[00:08:41] Speaker 04:
Right, but causal nexus is broad and vague and could mean, you know, he had the understanding of

[00:08:49] Speaker 00:
what we said in Apple III, Apple IV.

[00:08:51] Speaker 00:
The problem with that, Your Honor, is that when you look at the evidence that GenBand did present, which includes the testimony of their CEO and their head of sales saying that customers asked for these products and sort of the litany of evidence that we've gone through in our brief, including our damages experts, our technical experts saying what the advantage of these products were, how they helped to drive sales.

[00:09:15] Speaker 00:
In light of all of that evidence,

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You simply can't get to a finding that there's no causal nexus if all you have to show is that there's some connection between the infringement and the demand.

[00:09:26] Speaker 00:
The only way you can get there is by requiring us to show that it was the sole or primary driver of the demand as the district court of law 3 and out supported.

[00:09:36] Speaker 04:
Well, it's possible under that line of thinking that the lower court judge just concluded you didn't meet the some connection.

[00:09:44] Speaker 04:
I mean, you obviously feel like you do.

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He may have felt differently about that.

[00:09:49] Speaker 00:
The judge has absolutely no findings with respect to the evidence that I've been reciting here today.

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There is a wealth of evidence, of direct evidence, of consumer demand for this technology, and the district court made absolutely no factual findings with respect to any of that evidence.

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He simply concluded that our presentation didn't meet the burden.

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And this court should look at the whole record, including that evidence that the court did not even include within its categories in conclusion of law number six, and assess that.

[00:10:24] Speaker 00:
And when you do assess that, it would be unprecedented for direct competitors in a market like this, where infringement of seven patents has been found.

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And the other sides, CEO and head of sales, say these are things that customers are asking for.

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Their damages expert says they give a competitive advantage.

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They're charging extra.

[00:10:44] Speaker 02:
The court also said you waited seven years.

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And you never asked for a preliminary injunction.

[00:10:51] Speaker 02:
And that is evidence of lack of irreparable harm.

[00:10:57] Speaker 00:
Judge Laurie, what the court specifically found with respect to the timing of the lawsuit is that, and this is in conclusion of law 31,

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that the timing of the lawsuit, bringing it in 2014, January of 2014, was not an unreasonable delay by GenBan.

[00:11:14] Speaker 03:
And it came to that conclusion after it actually- That's in the Latchy's discussion.

[00:11:18] Speaker 00:
It was in the Latchy's discussion.

[00:11:19] Speaker 03:
Right.

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But he makes a separate point in conclusions of law 8 through whatever.

[00:11:26] Speaker 03:
You know the pageant.

[00:11:27] Speaker 03:
I mean, that relies on the, let's call it, the amount of time it took you to bring suit.

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as the second reason for rejecting a finding of irreparable harm, the first being your evidence really doesn't amount to the required in his u-causal nexus.

[00:11:48] Speaker 03:
But he does both of those, as I think he states, two reasons.

[00:11:51] Speaker 03:
He doesn't say independently sufficient reasons, but two reasons for not finding irreparable harm, right?

[00:11:56] Speaker 00:
Well, let me take that in two steps.

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First, all parties agree here that if I'm not wrong.

[00:12:03] Speaker 00:
Yes.

[00:12:03] Speaker 00:
Yes, Your Honor.

[00:12:04] Speaker 00:
All parties agree that a finding of delay cannot support a denial of injunction in this case.

[00:12:12] Speaker 00:
If you reversed on causal nexus, we would think that the record is strong enough that you ought to remand with an instruction to enter an injunction.

[00:12:22] Speaker 00:
But this case can't stand on delay alone.

[00:12:25] Speaker 03:
But with respect to yours... I understand that would be your position.

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You said it's also... I believe it's also their position on page 10 of the red brief.

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They admit that those factors are not dispositive.

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But with respect to the findings the court made, findings of fact 37 through 48 are specific detailed findings of fact that the court went through analyzing the timing of the lawsuit.

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And the court specifically found in finding of fact number 37 that GenBan's delay in filing the lawsuit, that it was reasonable

[00:13:01] Speaker 00:
that GenBan, in fact, did not know about the infringement after it acquired the SEVAS assets.

[00:13:07] Speaker 00:
That was in 2010.

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It explained that it was reasonable during that time period because, number one, Metaswitch was not viewed as a major competitor, and number two, Metaswitch's infringement was minimal.

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It also specifically found in finding a fact, number 38, that Metaswitch became a fierce competitor in 2013 or 2014, so less than a year before the lawsuit was filed.

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So in light of the court's specific findings that it was reasonable that we did not, in fact, know about the infringement and that it was not unreasonable delay to file this lawsuit in January 2014, that's wholly inconsistent with saying that any delay would be indicative of no irreparable harm.

[00:13:51] Speaker 00:
The other thing there is that you're not disputing that delay can be considered in combination with the other eBay factors.

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Delay can be considered in two situations.

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Even reasonable delay could be considered in the balance of harms if there is an accompanying reliance on that delay.

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And if we look at conclusion of law 52, we know that the court has already found that there is no reliance on MetaSwitch's part.

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The other place it can be considered is unreasonable delay can be considered in the irreparable harm side of things.

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But here we have a specific finding from the court that the timing of the filing of the lawsuit was not unreasonable delay.

[00:14:29] Speaker 04:
So since it's not unreasonable delay... So are you saying that as a matter of law, every time that the court finds no latches, and therefore any form of delay, it can't be considered in the eBay factors?

[00:14:43] Speaker 00:
It can be considered in the balance of harms.

[00:14:46] Speaker 04:
That it can't be considered in irreparable harm?

[00:14:48] Speaker 00:
In irreparable harm, it should be considered

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the same way it's considered in the Latches defense, and that is, is it reasonable or is it unreasonable?

[00:14:57] Speaker 00:
Well, I'm sorry.

[00:14:58] Speaker 03:
Why wouldn't reasonable delay nevertheless have some evidentiary value on the question, did you guys think that you were being irreparably harmed?

[00:15:11] Speaker 00:
Well, the data points that we have from this court are the SCA case, the Federal Circuit's Unbach decision in SCA.

[00:15:18] Speaker 00:
where the court specifically denoted that it was unreasonable delay that could be considered in connection with the irreparable harm.

[00:15:27] Speaker 00:
That's the data point that we have.

[00:15:29] Speaker 02:
You have almost exhausted your time.

[00:15:32] Speaker 02:
We'll hear from the other side, and we'll give you back three minutes.

[00:15:37] Speaker 00:
Thank you, Your Honor.

[00:15:40] Speaker 02:
Mr. Verhoeven.

[00:15:43] Speaker 01:
Good morning, Your Honors.

[00:15:44] Speaker 01:
May I please the court?

[00:15:47] Speaker 01:
The district court should be affirmed in this case because the appellant hasn't come close to meeting its burden to show a causal nexus in this case.

[00:15:56] Speaker 04:
Do you think the lower court, maybe this is this court's fault, but do you think the lower court was a little confused over what is the right articulation of the causal nexus standard for irreparable harm?

[00:16:12] Speaker 01:
No, I don't, Your Honor.

[00:16:14] Speaker 01:
If you summarize it succinctly, it still doesn't drive demand.

[00:16:18] Speaker 01:
These other cases that follow on are explaining what that means.

[00:16:24] Speaker 04:
One reading of A190 is that the judge wasn't embracing what we can all call further development of the understanding and meaning of the phrase driving consumer demand.

[00:16:41] Speaker 04:
He posits that

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GenBan or GenBan, whatever you call it, argues this, GenBan argues that, GenBan contends, and then GenBan argues.

[00:16:52] Speaker 04:
But the judge never takes the next step and says, yes, these are in fact the correct ways to understand the meaning of driving consumer demand.

[00:17:05] Speaker 04:
And I'm just wondering

[00:17:06] Speaker 04:
What am I supposed to take away from this?

[00:17:09] Speaker 01:
I think there's a little bit of ambiguity, Your Honor, but the most reasonable interpretation of that is that he agrees.

[00:17:17] Speaker 01:
Just because he put gen ban before it, you'll notice he cites to the controlling authority.

[00:17:24] Speaker 01:
And he doesn't turn around and say, I disagree with what they said.

[00:17:30] Speaker 02:
Why should consumer demand have anything to do with whether

[00:17:35] Speaker 02:
there has been harm caused by the infringement.

[00:17:40] Speaker 02:
If someone is infringing a patent and there is a relationship, obviously, between what is being sold and what the patent covers, why does consumer demand come into it?

[00:17:57] Speaker 01:
Well, it doesn't, Your Honor.

[00:18:00] Speaker 01:
What we're talking about is the causal nexus between the demand.

[00:18:04] Speaker 01:
Let me take that back.

[00:18:05] Speaker 02:
The way it comes in is if you tie that demand to the specific... But I'm asking why consumer demand is relevant to harm.

[00:18:19] Speaker 02:
If there's infringement and you have a patent, you're harmed.

[00:18:22] Speaker 02:
Irreparable harm is another question, and that spills into the second factor.

[00:18:30] Speaker 01:
Your honor, this is a case, just like the Apple case, where you have complex products that have thousands of different features.

[00:18:39] Speaker 01:
And in those kind of, it's not like a windshield wiper that's primarily got a specific feature.

[00:18:48] Speaker 01:
So in these very complex, big product cases with thousands of features.

[00:18:54] Speaker 02:
But didn't they relate to lost profits and what the base was?

[00:18:59] Speaker 01:
No, it relates to, in these cases, just like the Apple case, you have to make some determination that there's a relationship between the feature that's accused of infringing among the thousands of features and an effect on consumer demand.

[00:19:20] Speaker 01:
And this court has come up with this causal nexus test.

[00:19:25] Speaker 01:
in these kind of situations specifically, it's most important in these kind of... Is that a good test?

[00:19:31] Speaker 01:
Yes, it is.

[00:19:32] Speaker 01:
It's a good test.

[00:19:34] Speaker 01:
And it's important for... Today we have increasingly complex objects.

[00:19:41] Speaker 01:
You know, in the smartphone cases we had computers that you could hold in your hand with thousands of features.

[00:19:47] Speaker 02:
But isn't that a question of harm, whether you've lost sales or profits because of the infringement?

[00:19:54] Speaker 01:
because of the infringement.

[00:19:55] Speaker 01:
So you have to then ask the question, was the harm, was the loss of sales connected to the infringement?

[00:20:03] Speaker 01:
Another flip-side way of saying that is, was the infringement, is there a connection between the infringement and consumer demand, which is the court's test.

[00:20:13] Speaker 01:
And here, the district court properly found that the appellant here has not met its burden of proof.

[00:20:21] Speaker 01:
One of the things I want to highlight is, what's not

[00:20:24] Speaker 01:
what we didn't see in the evidence in this case.

[00:20:28] Speaker 01:
They did not hire an expert to provide an opinion on causal nexus.

[00:20:33] Speaker 01:
The expert testimony you see cited in the record is not concerned causal nexus.

[00:20:39] Speaker 01:
They didn't even bother to hire an expert.

[00:20:41] Speaker 01:
There's no survey that they conducted in this case that tries to determine whether the accused features here had a causal effect.

[00:20:53] Speaker 01:
on the demand by customers.

[00:20:56] Speaker 03:
Let me just say, the way that I guess I'm thinking about this is as follows.

[00:21:02] Speaker 03:
We have said in the series of Apple cases, under the heading of drives consumer demand, a number of different things.

[00:21:10] Speaker 03:
And there's a stricter version and a more flexible version.

[00:21:17] Speaker 03:
the more flexible version reflecting the fact that there is no unitary thing called consumer demand when you have a market consisting of lots and lots of demanders and lots and lots of features.

[00:21:29] Speaker 03:
So you have to take account of the mix of considerations that go into any substantial number, non-insubstantial number of choosers, of demanders.

[00:21:44] Speaker 03:
And Apple III,

[00:21:46] Speaker 03:
in the part of it that the district court did not quote kind of explains what I would call the more complicated, softer version.

[00:21:59] Speaker 03:
And then that has picked that the some connection paragraph of, of Apple three what the district court quotes from Apple three is from the previous paragraph and particular quotes, a sentence that is referring to the harsher

[00:22:15] Speaker 03:
more demanding standard and saying, but no, that really isn't quite right.

[00:22:20] Speaker 03:
And that's why Apple III says the sole reason notion that I think in that case the district court had relied on was wrong.

[00:22:32] Speaker 03:
And Apple III says that.

[00:22:33] Speaker 03:
And then it's the next paragraph that really introduces the softer version, and that's picked up in Apple IV.

[00:22:39] Speaker 03:
What I'm not really

[00:22:41] Speaker 03:
confident about from reading this brief discussion in the district court's opinion here is that the district court had that softer version in mind when saying the evidence was insufficient.

[00:22:55] Speaker 03:
And if that's right, I certainly don't feel like I've mastered all of the evidence back and forth to be able to make a determination that that difference between the softer and more rigid standards

[00:23:11] Speaker 03:
could not make any difference in the outcome here.

[00:23:13] Speaker 03:
So why don't we remand for it?

[00:23:15] Speaker 01:
Because the district court isn't required to lay out every piece of how drive consumer demand has been articulated.

[00:23:24] Speaker 01:
And secondly, the district court does expressly recognize the arguments that the appellant has made about some connection, cites to the Apple decisions, and does not disagree with them.

[00:23:37] Speaker 01:
And as I stated before, I think the most

[00:23:40] Speaker 01:
clear interpretation of that is he does not disagree with them.

[00:23:44] Speaker 01:
And he's pointing out that the appellant has raised that those particulars about what it means to drive demand incited to the Apple cases.

[00:23:56] Speaker 04:
Do you understand though that maybe to a reader like me, the fact that the one positive thing that the judge adopted about

[00:24:09] Speaker 04:
our case law is the phrase driving consumer demand, which immediately puts him in a danger zone, because that's the exact same phrase that in Apple IV this court deemed to be something that needed vacator on in that particular case, because that phrase is so vulnerable to being used and understood in what Judge Toronto calls the

[00:24:38] Speaker 04:
the harder, more rigid version?

[00:24:40] Speaker 01:
Yes, Your Honor.

[00:24:41] Speaker 01:
The way I look at it is the standard still is drives consumer demand.

[00:24:44] Speaker 01:
That's the standard.

[00:24:46] Speaker 01:
Now, interpretations of that have come afterwards.

[00:24:49] Speaker 01:
That does not mean, one interpretation is that does not mean it's the sole or predominant driver of consumer demand.

[00:24:57] Speaker 01:
It has to have some connection.

[00:25:00] Speaker 01:
The other interpretation is it has to have some connection.

[00:25:04] Speaker 01:
Now, maybe the word some hasn't been defined by the Federal Circuit yet.

[00:25:07] Speaker 01:
But those are both interpretations of the standard.

[00:25:13] Speaker 01:
And in this case, the judge stated the standard and then quoted appellants' reference to the softer version, as you say, which is the current.

[00:25:25] Speaker 03:
I suppose this is stating the obvious.

[00:25:28] Speaker 03:
But the paragraph, Conclusion 5, which, as you know, says, GenBand argues, GenBand argues, GenBand contends, GenBand argues.

[00:25:37] Speaker 03:
is then followed not by saying, even under that view, I find.

[00:25:44] Speaker 03:
So I can't really tell whether what follows immediately after is a way of saying, I'm applying those standards.

[00:25:53] Speaker 03:
Or Jen Ben has just argued this, but a standard isn't that low.

[00:26:00] Speaker 01:
Well, Your Honor, I think that it's very reasonable and probably

[00:26:06] Speaker 01:
I can't think of another reasonable interpretation of this.

[00:26:09] Speaker 01:
In addition to saying Genban argues, the court cites to the very Apple cases that we're talking about here.

[00:26:19] Speaker 01:
And the court does not say it disagrees with it.

[00:26:22] Speaker 01:
It brings it up.

[00:26:24] Speaker 01:
Their whole argument is just that he sticks the word Genban argues in front of the propositions.

[00:26:31] Speaker 01:
The court itself is citing the Apple cases.

[00:26:34] Speaker 01:
for those propositions, and the court itself is not disagreeing with them.

[00:26:40] Speaker 01:
The court does not disagree with that.

[00:26:42] Speaker 01:
It takes those as part of the statement of the law, and then it goes on, Your Honor.

[00:26:47] Speaker 01:
And there's no statement in here indicating the court is applying the predominant causal requirement, or that would be the exclusive driver of demand.

[00:26:57] Speaker 01:
There's no statement whatsoever here of that, Your Honor.

[00:27:01] Speaker 01:
So I think that would be

[00:27:03] Speaker 01:
reaching out to interpret the court's statement of the law in a way that the court did not intend.

[00:27:14] Speaker 01:
And it would also be... Well, why should we be guessing about that?

[00:27:21] Speaker 03:
Why wouldn't it be more sensible, particularly when the next paragraph is really the only paragraph that

[00:27:32] Speaker 03:
discusses the evidence and that is four and a half lines long and I don't think you would disagree that there was at least some amount of evidence on this question of how many sales may have been lost as a result of the patented features that's not really referred to here.

[00:27:58] Speaker 01:
First of all, of course, as everyone knows, the judge is presumed to have considered all the evidence.

[00:28:04] Speaker 01:
But to answer your question, to do so would be essentially imposing a requirement on judges to talk all the way through every, you know, all the permutations of a standard.

[00:28:18] Speaker 03:
No, no, no, you know, I mean, it's a judgment call about how much discussion conveys that

[00:28:25] Speaker 03:
all the important matter has been discussed under the right legal standard.

[00:28:29] Speaker 03:
And sometimes what we're faced with is some uncertainty about that.

[00:28:34] Speaker 03:
And sometimes we don't have any uncertainty that makes us think the outcome is in any doubt.

[00:28:44] Speaker 03:
I'm not quite sure that we can reach that conclusion here.

[00:28:47] Speaker 01:
Well, again, there's no statement even addressing the

[00:28:54] Speaker 01:
primary, the prior incorrect interpretation of driving demand, and to the opposite, there's statements expressly talking about the some, it's the phrase, some connection standard, citing to Apple, the Apple cases, and the only basis for the vagueness

[00:29:19] Speaker 01:
is that the court phrased it as Gen Band argues.

[00:29:22] Speaker 01:
The court never says it disagrees with that standard.

[00:29:25] Speaker 01:
And it's expressly invade.

[00:29:29] Speaker 04:
So why do you think the judge used the phrase Gen Band argues, Gen Band argues, Gen Band contends, and Gen Band argues?

[00:29:37] Speaker 04:
What do you think was in his mind?

[00:29:38] Speaker 01:
To this extent, that's a way that the court's right opinions in the Eastern District.

[00:29:43] Speaker 01:
They often summarize things by arguments.

[00:29:49] Speaker 01:
I can't explain why he put the words Genban argues in front of it, but certainly the court was aware of the standard, the court cited the standard, and the court never said it disagreed with the standard.

[00:30:02] Speaker 01:
Basically, we're talking about how far is the district court required to go in reciting various cases and how they're interpreted.

[00:30:13] Speaker 04:
What we need to ask... Here's a hypothetical.

[00:30:16] Speaker 04:
This is going to a different issue.

[00:30:19] Speaker 04:
Let's say that GenBan had 26 pieces of evidence, evidence A, B, C, all the way down to evidence Z. And then a district court decision said, during the trial, GenBan presented evidence A, evidence B, and evidence C. We don't find GenBan's evidence to be

[00:30:48] Speaker 04:
persuasive and to meet its burden.

[00:30:51] Speaker 04:
Under those circumstances, would you say a vacate and remand is required?

[00:30:58] Speaker 01:
No, Your Honor.

[00:31:00] Speaker 01:
This judge held an actual bench trial with live witnesses.

[00:31:04] Speaker 01:
He assessed credibility.

[00:31:06] Speaker 01:
He went to great effort to hear all the evidence.

[00:31:09] Speaker 01:
And we know, and I can cite you cases, that district court judges are presumed to have considered all the evidence.

[00:31:18] Speaker 01:
The fact that in this case, we're talking about over 100 pieces of evidence, maybe 1,000.

[00:31:26] Speaker 01:
Where do you draw the line on how far a judge has to go in addressing each piece of evidence?

[00:31:31] Speaker 04:
Right.

[00:31:31] Speaker 04:
But I guess in the hypothetical, the judge isn't saying, I've considered all 1,000 pieces of evidence, and here's where I fall, and here's why I fall that way.

[00:31:42] Speaker 04:
It's more, I've considered evidence A, evidence B, and evidence C.

[00:31:48] Speaker 01:
Well, those are the main tranches in which the evidence was organized below.

[00:31:52] Speaker 01:
And the judge doesn't need to say I've considered every piece of evidence because the judge is presumed to have considered all the evidence.

[00:32:00] Speaker 01:
So there's plenty of instances when you have an opinion that doesn't say I've considered all the evidence.

[00:32:08] Speaker 04:
Right.

[00:32:09] Speaker 04:
But now we're left in a position up here where all the briefing, there's 20 pages of briefing on each side about all these additional pieces of evidence that don't really

[00:32:18] Speaker 04:
fall in the three tranches, and now we're the ones now trying to figure out why the lower court judge could have been right in concluding that these pieces of evidence, likewise, don't help the patent owner.

[00:32:37] Speaker 01:
I think the evidence, if you look at it in the briefing, is indeed mostly in those three tranches, Your Honor, and the other evidence

[00:32:47] Speaker 01:
I could go through an address, but it's not persuasive evidence.

[00:32:52] Speaker 01:
So again, the court summarized as part of an 80-page opinion, there were a lot of issues before the district court, and the court went out of its way to hold an bench trial.

[00:33:06] Speaker 01:
It didn't just do it on the briefs, to assess the credibility of the parties.

[00:33:10] Speaker 01:
One of the things

[00:33:12] Speaker 01:
This is why district courts are the primary people or should be deferred to and look for clear error.

[00:33:18] Speaker 01:
When you talk about all this evidence that you have to weed through, all you need to do is say, is there a piece of evidence that shows clear error?

[00:33:25] Speaker 01:
And there is none.

[00:33:26] Speaker 01:
You can go through each one of these pieces, which we don't have time to do, but none of those show clear error.

[00:33:34] Speaker 01:
And even together, they don't show clear error.

[00:33:36] Speaker 01:
There's no evidence.

[00:33:37] Speaker 02:
Thank you, counsel.

[00:33:38] Speaker 02:
We have your argument.

[00:33:40] Speaker 02:
Thank you.

[00:33:41] Speaker 02:
Pubail has three minutes of rebuttal time.

[00:33:50] Speaker 00:
Thank you, Your Honor.

[00:33:55] Speaker 03:
Can I ask this?

[00:33:58] Speaker 03:
I assume you had some sort of counsel's argument before Judge Gilstrap about the injunction proceeding, not just witnesses.

[00:34:06] Speaker 00:
We did, Your Honor.

[00:34:07] Speaker 03:
And was there discussion of the

[00:34:11] Speaker 03:
causation standard in that?

[00:34:15] Speaker 00:
There was, and there was specific recitation pointing to the cross-examination evidence we had elicited that customers were asking for these very features.

[00:34:25] Speaker 03:
Just on the question of what the right interpretation of the causation standard is, we've expressed a stricter view and a more flexible view

[00:34:39] Speaker 03:
Were the parties debating that?

[00:34:41] Speaker 03:
Did everybody agree that, in particular the other side, agreed that a sum connection standard is what the court should be applying?

[00:34:54] Speaker 00:
I'd have to check the briefing to be sure, but certainly they were focused on the drives customer demand as a lead argument of theirs.

[00:35:03] Speaker 00:
Whether or not they acknowledged the sum connection, I don't have an immediate recollection, Your Honor.

[00:35:09] Speaker 03:
The obvious problem is that the phrase drives customer demand by itself.

[00:35:13] Speaker 03:
Sounds harsh, but it has been interpreted to be not so harsh.

[00:35:17] Speaker 03:
And so if you emphasize that, you are suggesting this is a very, very high standard.

[00:35:22] Speaker 03:
You have to shed those words and replace them with other words, like the sun connection standard, to start getting the feel of how demanding the standard actually is.

[00:35:33] Speaker 00:
Right, and your honor pointed to Apple III and Apple IV, and there it was discussed three examples that would satisfy the sum connection.

[00:35:42] Speaker 00:
Not that those are the only ways, but one way was to show that it's one of several factors that customers consider in their buying choices.

[00:35:50] Speaker 00:
Another one was to show that there are benefits to the patented invention that make it more desirable, significantly more desirable for customers.

[00:35:57] Speaker 00:
Another one was to show that the absence of that invention would make it less desirable

[00:36:02] Speaker 00:
And in particular, the evidence that was not recited anywhere in the court's order on the injunction shows that we satisfy counsel nexus under all of those examples, under all those standards.

[00:36:14] Speaker 00:
I take issue with my colleague's statement that pretty much all the evidence fell into those three categories.

[00:36:20] Speaker 00:
I don't think that's the case at all.

[00:36:23] Speaker 00:
The evidence of the CEO and the head of sales of their side testimony about customers asking for this, that's not in that bucket.

[00:36:31] Speaker 00:
Evidence that their damages experts said that the 561 patent gives a competitive advantage to us, that's not in those buckets.

[00:36:39] Speaker 00:
Evidence from their documents saying that the 561 patent is a key selling point for them, not in those buckets.

[00:36:46] Speaker 00:
Evidence that we had a customer survey on the 279 and 589 patents where customers said this is important, not in those buckets.

[00:36:54] Speaker 00:
Evidence that customers were paying extra for these patented features, not in those buckets.

[00:36:59] Speaker 00:
We've got critical, significant evidence here

[00:37:01] Speaker 00:
that in our view, Your Honor, this is like the Bosch case, where we think if you were to remand this and anything came back other than an injunction should issue, what you'd be doing is basically giving them a stay of an injunction without a bond, which is inequitable.

[00:37:19] Speaker 00:
I think just like the Bosch case, in the Bosch case we had a fully developed record and it focused only on the injunction point.

[00:37:26] Speaker 00:
That's what we've got here.

[00:37:27] Speaker 00:
There they had 17 months between the jury finding of infringement

[00:37:31] Speaker 00:
and the oral argument.

[00:37:33] Speaker 00:
That's just what we have here.

[00:37:34] Speaker 02:
Thank you, counsel.

[00:37:36] Speaker 02:
Time is up.

[00:37:37] Speaker 02:
We will take the case under discussion.