[00:00:13] Speaker 02:
Okay, the next application is number 17.

[00:00:43] Speaker 02:
1212 Bradware Limited against F5 Networks, Incorporated.

[00:00:49] Speaker 04:
Mr. Marino.

[00:00:51] Speaker 04:
Good morning, Your Honor.

[00:00:54] Speaker 04:
The court should affirm the judgment of the district court that the rubber patents are valid and infringed, but it should reverse the four erroneous ruling, pre-trial ruling, by the district court relating to the 7-2 patent, the opt fixes, damages,

[00:01:10] Speaker 04:
and then reinstate the jury's verdict for infringement of the 319 pattern.

[00:01:15] Speaker 04:
Given the time limitations and our focus on the 7 and 2 pattern issues, the damages issues and others, the others too, as signed permits.

[00:01:25] Speaker 05:
Let me just ask you one question about the damages issue.

[00:01:30] Speaker 05:
Yes, sir.

[00:01:31] Speaker 05:
I've read the district court opinion.

[00:01:32] Speaker 05:
I've read the briefs.

[00:01:34] Speaker 05:
Presumed, and they don't give us a very clear picture of what happened in discovery,

[00:01:38] Speaker 05:
Presumably, there was an interrogatory or something like that asking for your damages theory.

[00:01:45] Speaker 05:
Is that correct?

[00:01:46] Speaker 05:
No, there was a preliminary damages disclosure.

[00:01:49] Speaker 05:
There was... Pursuant to the automatic disclosure?

[00:01:53] Speaker 05:
Correct.

[00:01:54] Speaker 05:
Okay.

[00:01:54] Speaker 05:
And in making that disclosure, you referred to your expert report when we did not.

[00:02:00] Speaker 04:
In that preliminary disclosure, and I can give you the appendix side if you'd like, we identified, it was very early in the case, we identified the accused product being the BKB product, which is all of them, and they all were found to have infringed, and we said we're entitled to reasonable royalties as well as lost profits.

[00:02:16] Speaker 04:
That was the preliminary disclosure.

[00:02:18] Speaker 04:
Subsequent to that, during discovery, we also supplemented the disclosure to refer to the expert report.

[00:02:27] Speaker 05:
document in the record here?

[00:02:29] Speaker 04:
I don't have a precise site, but I think even from the court's rulings, it's clear that the court was referred to anything in the report by a expert to be properly disclosed.

[00:02:41] Speaker 05:
Well, yes, I understand that, but if I agree with the district court that the expert report didn't properly disclose this, what I then ask myself is whether you identify the expert report as the source of your disclosure of your damages theories.

[00:02:56] Speaker 05:
I believe we did here.

[00:02:58] Speaker 04:
I don't have the precise site.

[00:02:59] Speaker 04:
I will look at it for you.

[00:03:01] Speaker 04:
But I think that was given by the district court agreed with that contention.

[00:03:05] Speaker 04:
And just to focus the issue on damages.

[00:03:10] Speaker 04:
What the district court did wasn't limit us to what the expert had disclosed.

[00:03:15] Speaker 04:
If they had done that, it would be a different case.

[00:03:18] Speaker 04:
What the district court did was to blue pencil the expert's opinion.

[00:03:23] Speaker 04:
So the expert gave a comprehensive damages disclosure that included damages and the GTM versions of the big IP product, and the district court excluded a very significant portion of those damages that the expert had given an opinion on.

[00:03:41] Speaker 05:
And the best place to see that... Okay, but the problem is the expert only calculated damages for licensed products.

[00:03:49] Speaker 05:
And then you decided that you wanted to extend that to include a product that wasn't licensed because of the capability existed.

[00:04:00] Speaker 04:
That is not quite correct, Your Honor.

[00:04:04] Speaker 04:
What we did is we accused from the very beginning every single sale of the BNP product.

[00:04:10] Speaker 05:
Every single sale.

[00:04:11] Speaker 05:
No, what I'm talking about, you may have accused it, but the damage is calculation, presumably because

[00:04:18] Speaker 05:
unlicensed products might be difficult to show damages because the user wouldn't be using it without a license.

[00:04:25] Speaker 05:
But as I understand it, the expert report limited itself to a licensed product.

[00:04:34] Speaker 05:
Is that not correct?

[00:04:36] Speaker 05:
I don't understand what you mean by licensed products.

[00:04:38] Speaker 04:
Well, the word is used in the brief.

[00:04:40] Speaker 04:
I want to make sure we're precise.

[00:04:43] Speaker 04:
So you sell a license to the software on the product, when you sell the product.

[00:04:48] Speaker 04:
So that you can access that functionality in the software.

[00:04:52] Speaker 04:
The expert, and this is in the appendix at page 5597, that's the summary of his damages opinions from his report, which the distributor concedes, this was what he disclosed, includes every sale with a license to the LTM module,

[00:05:08] Speaker 04:
or the GTM module or the link controller module, any one of the three.

[00:05:13] Speaker 04:
Very clear from this page, appendix 5597, which was also an exhibit we wanted to introduce at trial.

[00:05:21] Speaker 04:
The court struck this exhibit and said, it goes beyond where I'm going to allow you to present it.

[00:05:28] Speaker 04:
Yeah, but it goes beyond what you disclosed earlier.

[00:05:30] Speaker 04:
Well, we obviously had disclosed it because it wasn't in the expert report.

[00:05:34] Speaker 04:
Well, that's the question.

[00:05:35] Speaker 05:
The question is, what was disclosed in the expert report?

[00:05:38] Speaker 05:
you make one argument about what was disclosed, the district court found something else.

[00:05:42] Speaker 04:
So I don't want to... That is correct, but I just want to be clear on what we were all talking about the same day.

[00:05:48] Speaker 04:
So let me go back to the 702 for a minute.

[00:05:50] Speaker 04:
So in the 702, what we have is a claim construction error.

[00:05:54] Speaker 04:
So the F5 move for summary judgment of non-infringement based only on the district court's claim construction, it did not move under our proposed claim construction.

[00:06:04] Speaker 04:
So if we're correct that the

[00:06:06] Speaker 04:
claim construction was erroneous, then the summary driver has to be reversed as well.

[00:06:10] Speaker 04:
And the claim construction was primarily the term proximity, which appears in claim 8, for example, the 7 of 2000.

[00:06:20] Speaker 05:
The heart of your argument is that proximity and network proximity are the same thing, right?

[00:06:27] Speaker 04:
Or at least substantially overlapping.

[00:06:29] Speaker 04:
So if you just look at the claim language itself,

[00:06:32] Speaker 04:
Proximity is a more generic term than network proximity.

[00:06:35] Speaker 05:
Network proximity should be at least as broad in this context.

[00:06:38] Speaker 05:
So why does the specification go to great lengths to define network proximity?

[00:06:44] Speaker 05:
Because that's not a term that is used in any of the claims, nor is it a term, so far as I can tell, that was used in the parent 801 patent claims either, right?

[00:06:58] Speaker 04:
So I think the definition of hyperproximity, as you noted, was introduced in the parent application.

[00:07:03] Speaker 04:
It was retained in the subsequent patents including CERN.

[00:07:06] Speaker 04:
Why?

[00:07:07] Speaker 04:
What function did it serve?

[00:07:09] Speaker 04:
Because I think when they say proximity, they meant to include at least hyperproximity.

[00:07:14] Speaker 04:
And in fact, the file history specifically confirms that.

[00:07:21] Speaker 01:
Were there ever claims, whether initially filed or issued in any parent

[00:07:27] Speaker 01:
applications that went to the subject of the network proximity, namely choosing which server to go to where you have more than one possible server and you're trying to figure out which one to go to on the basis of some notion of proximity or claims always about the different topic.

[00:07:51] Speaker 01:
Once you know what server you want to get to,

[00:07:57] Speaker 01:
best proximity with the endpoint fixed.

[00:08:01] Speaker 04:
So the other one pattern was primarily directed to the GSLB, global server load balancing, to choose in which server farm to go to, two different ones.

[00:08:10] Speaker 04:
The other one, the other one, the other one.

[00:08:12] Speaker 01:
So that explains why it's in there, but the very terms in the spec of the network proximity definition, which is what you proposed, make no sense when

[00:08:25] Speaker 01:
You're talking about the problem of we know which server we want to go to.

[00:08:31] Speaker 01:
We're trying to figure out what path.

[00:08:33] Speaker 01:
Because it's a comparison of different servers.

[00:08:36] Speaker 04:
It's a comparison of paths to different servers.

[00:08:39] Speaker 01:
I'm sorry.

[00:08:39] Speaker 01:
Network proximity definition in the spec and in your proposed construction is by its terms a comparison of paths to different servers.

[00:08:50] Speaker 01:
That makes no sense as a construction

[00:08:54] Speaker 01:
of a term in a context where you know a single server is where you're going to and you're just trying to compare different paths to that server.

[00:09:03] Speaker 04:
I would respectfully disagree.

[00:09:05] Speaker 04:
The proximity is a quality of the path between a client and a server.

[00:09:10] Speaker 04:
So I have proximity between a client and two different servers, I'll have two different proximities.

[00:09:15] Speaker 04:
Think of proximity as distance.

[00:09:17] Speaker 04:
I can talk about the distance

[00:09:19] Speaker 01:
I want you to respond to this.

[00:09:25] Speaker 01:
It seems to me that the network proximity definition in the spec cannot possibly be the right

[00:09:36] Speaker 01:
construction for proximity, because it doesn't even make sense.

[00:09:41] Speaker 01:
So now the question is, we have the term proximity.

[00:09:44] Speaker 01:
The term proximity, who knows what that means?

[00:09:46] Speaker 01:
So you do what our law tells you to do, look at the spec.

[00:09:51] Speaker 01:
And is it right to say that every time the patent talks about proximity when asking which of two paths to the same server

[00:10:00] Speaker 01:
you want to, you know, has the better proximity.

[00:10:03] Speaker 01:
It relies on at least one of the three things, latency and whatever the other two things are, that the district court called out.

[00:10:12] Speaker 04:
So, in the embodiment, as you understand the question, so in the specific embodiments of Figure 3 and Figure 4, which are the ones that go to the same server over two different routes, it talks about, it gives those three examples.

[00:10:24] Speaker 04:
And I agree.

[00:10:25] Speaker 01:
And it never refers to anything else, right?

[00:10:28] Speaker 04:
The three examples are all specific to one of those three metrics.

[00:10:32] Speaker 04:
However, and I take the point, I think it's a good point, that network reasoning, as it is defined as a definition, its totality perhaps is too expensive to read in proximity.

[00:10:43] Speaker 04:
There is clearly overlap between the two, right?

[00:10:46] Speaker 04:
So hops and latency are given as specific examples, both for GSLB and for LLB.

[00:10:51] Speaker 04:
So clearly, the metrics can be the same.

[00:10:53] Speaker 04:
or at least some of them can be.

[00:10:56] Speaker 04:
So the real problem I have with this record's construction, it completely ignores the definition of network proximity.

[00:11:03] Speaker 04:
And I think there is parts of that definition that are relevant and inform the definition of proximity.

[00:11:08] Speaker 04:
For example, the concept that proximity is the quality of the relationship between a client and a server, considering multiple metrics, and it's an open-ended list of metrics.

[00:11:19] Speaker 04:
Conversely, this record just limited it to the one and body

[00:11:22] Speaker 04:
on one of those three.

[00:11:25] Speaker 01:
Let me just for purposes of, let me ask.

[00:11:28] Speaker 01:
Suppose for a minute that the district court was incorrect to say that proximity was limited to those three things and instead should have said at least one of those three things has to be part of the proximity calculation.

[00:11:46] Speaker 01:
That doesn't change the summary judgment result because the only proximity, the only aspect of the accused products that you accused involves none of those three things.

[00:11:57] Speaker 04:
That would be because that was a difficult fact.

[00:12:00] Speaker 01:
But if it said such as one of those three, then it would have been a different result.

[00:12:04] Speaker 01:
Right, but that's a different point.

[00:12:05] Speaker 01:
And what do you make of the fact, I guess it's at the comp,

[00:12:09] Speaker 01:
top of column two or four, right-hand side column on the left-hand side page.

[00:12:14] Speaker 01:
The district court said figuring out how long the server is going to take to respond is actually part of a later step in the process, not the proximity determination.

[00:12:26] Speaker 04:
I think that supports the concept that it's the quality of the relationship between the client and the server.

[00:12:31] Speaker 04:
So how long you might take the server to respond would certainly influence latency when you respond.

[00:12:37] Speaker 04:
So I think the real point here is even if you don't adopt word-per-word the definition of network proximity, you should have given some way in giving a construction of the term proximity, which seems from its face to include at least a substantial portion of network proximity.

[00:12:55] Speaker 05:
And for example, the real claim... Do you have any difficulty understanding, since you agree they're not the same, you suggest there's overlap

[00:13:04] Speaker 05:
I don't know how looking at the definition of network proximity really helps you decide what the term proximity means.

[00:13:12] Speaker 05:
I mean, the use of two different terms to suggest that they have different meanings.

[00:13:17] Speaker 04:
Well, they're used interchangeably in certain parts of the specification, for example, with respect to proximity table, which is found both in figures 2 and in figures 3D.

[00:13:26] Speaker 04:
Figures 2A is in the GSLB portion, and figures 3D is in the LLB portion.

[00:13:32] Speaker 04:
They're both called proximity tables.

[00:13:34] Speaker 04:
And the court even said in the flame construction order, the appendix at page 9, that the inventor shortened the term network proximity to proximity when describing figures to weight.

[00:13:46] Speaker 04:
So I think it's very hard to draw the conclusion that the inventors intended to say two completely different things.

[00:13:54] Speaker 04:
And as I said, there is a part of the file history that's very instructive, and we addressed in our opening brief,

[00:14:00] Speaker 04:
And F5 did not respond to their response, and the district court didn't address this in its own claim construction order.

[00:14:07] Speaker 04:
That is, in the appendix 37 of 6.

[00:14:11] Speaker 04:
And that is that when, in the 319 patent, we had the claims after the original filing, we had to identify support in the specification for those claims.

[00:14:23] Speaker 04:
Those new claims included the word proximity.

[00:14:26] Speaker 04:
and we identified as supporting the SPAC the very portion of the specification that defines network proximity.

[00:14:33] Speaker 04:
So at least the file history lends strong support to an equivalence between network proximity and proximity, not a disjunctive reading, which is what the district court really did here.

[00:14:45] Speaker 04:
I think for those reasons we would first report to reverse the chain construction.

[00:14:52] Speaker 04:
I'm going to briefly talk about damages beyond.

[00:14:54] Speaker 04:
I think you kind of put the spotlight on the real issue, which is, if in fact, and I think that's the argument that F5 makes, the district court was trying to cabinet to what was disclosed in the expert report.

[00:15:10] Speaker 04:
And we should have been cabinet to that.

[00:15:12] Speaker 04:
We should have been cabinet to a subset of that.

[00:15:14] Speaker 04:
How did the district court cabinet to a subset of what the expert had put in his summary of damages?

[00:15:20] Speaker 04:
By saying,

[00:15:21] Speaker 04:
You cannot get damages for old infringing products.

[00:15:25] Speaker 04:
You can only get damages for old infringing products for which the user has bought a license to a specific module.

[00:15:32] Speaker 04:
But not only that, that module, so 114... To advise to turn infringing module.

[00:15:39] Speaker 04:
But infringing module has no concept.

[00:15:40] Speaker 04:
It doesn't exist.

[00:15:41] Speaker 04:
So the Q's product is the big IP that's 14 modules.

[00:15:45] Speaker 04:
This is a situation that's indistinguishable from a situation infringing.

[00:15:49] Speaker 05:
Yeah, but what the district court is saying is that you didn't disclose that you were seeking damages with respect to items where there was no license that would have made the use infringing, correct?

[00:16:10] Speaker 04:
Well, that's not what the expert said.

[00:16:12] Speaker 04:
That's what the district court concluded.

[00:16:13] Speaker 04:
The expert said is if the product doesn't infringe,

[00:16:18] Speaker 04:
then, of course, I have to take it out on my damages.

[00:16:21] Speaker 04:
But if the product does infringe, I have to count.

[00:16:23] Speaker 04:
And that's if you look at both his summaries.

[00:16:25] Speaker 04:
So you're arguing about what the expert report disclosed.

[00:16:29] Speaker 04:
Correct.

[00:16:31] Speaker 04:
So we see a lot of results that remain.

[00:16:36] Speaker 02:
Yes, you've saved some time for a rebuttal.

[00:16:41] Speaker 02:
We'll see what it includes.

[00:16:42] Speaker 02:
Mr. Al-Salaam.

[00:16:47] Speaker 03:
Thank you, Senator.

[00:16:49] Speaker 03:
I'm not sure what subjects you would like me to start with.

[00:16:53] Speaker 03:
With respect to the 702 patent, I agree completely with what Jeff Charanto was mentioning.

[00:16:59] Speaker 03:
The network proximity definition was in the parent, which only disclosed global server load balancing.

[00:17:06] Speaker 03:
The 702 patent comes from a continuation of part application, which had a new subject matter with respect to ISP load balancing.

[00:17:16] Speaker 03:
And as the court mentioned,

[00:17:17] Speaker 03:
The distinction is, when you're talking about ISP load balancing, you're only going to a single server or server farm.

[00:17:24] Speaker 03:
So server capacity, for example, makes no sense in that context.

[00:17:29] Speaker 03:
There is nothing to compare in terms of server capacity.

[00:17:33] Speaker 03:
And the only examples of proximity in the ISP load balancing context are the three we talked about, latency, hops, and time to live.

[00:17:43] Speaker 03:
And time to live is a form of hops.

[00:17:46] Speaker 03:
The other thing about this claim language we need to keep in mind, the proximity ratings are for routes.

[00:17:52] Speaker 03:
You are rating routes.

[00:17:54] Speaker 03:
So something like server processing capacity is not even a route-based measurement.

[00:18:01] Speaker 03:
And the fastest link measurement, which the court is referring to, is not a route-based measurement.

[00:18:07] Speaker 03:
The fastest link measurement is equivalent to determining how many people are trying to get on an on-ramp.

[00:18:15] Speaker 03:
at a given intersection on the interstate.

[00:18:18] Speaker 03:
It is not a measure of how long a route that begins at that intersection to some destination will take, or how many intersections there are on the way.

[00:18:29] Speaker 03:
Hopps is equivalent to intersections.

[00:18:32] Speaker 03:
I will move on quickly to the damages portion issue, which Judge Dyke has raised.

[00:18:40] Speaker 03:
This is what you have to keep in mind.

[00:18:44] Speaker 01:
is a fourteen-module product and the way it's sold is customers license a certain module one at a time and they pay for that module their expert but the physical thing that they get in fact has the capability there if only it is properly turned up yes and because of the claim language in this is the 319 that relevant claims the court said

[00:19:14] Speaker 01:
All of those products, no matter what's turned on, in fact, are infringing because that has a pretty broad capability term.

[00:19:22] Speaker 01:
And then the court said, but what damages you would get actually depend on what functionality is used by the user.

[00:19:35] Speaker 01:
And that, in turn, depends on whether they license LTM only, LTM plus GTM, one or the other.

[00:19:42] Speaker 03:
The court didn't say that.

[00:19:43] Speaker 03:
That's what their experts said.

[00:19:45] Speaker 03:
In other words, I agree.

[00:19:47] Speaker 03:
The court said for every big IP device that we sell or we distribute, that that is an act of infringement.

[00:19:56] Speaker 03:
And that's the Fingen case.

[00:19:59] Speaker 05:
And so what the court said was that even though that's an act of infringement, I read the damages report, which was the disclosure of their damages theory.

[00:20:08] Speaker 05:
to be limited to situations in which there was a license that would have rendered the use infringing?

[00:20:15] Speaker 03:
Yes.

[00:20:17] Speaker 03:
I think of it this way.

[00:20:18] Speaker 03:
What the expert said, and I can certainly cite portions in both in his report and in his testimony, he said, I have chosen to base damages on sales and revenues of modules that practice the patented functionality.

[00:20:36] Speaker 03:
And let's keep in mind, it would be unreasonable to do otherwise.

[00:20:41] Speaker 03:
And I just want to step back.

[00:20:43] Speaker 03:
If that expert had told us at the beginning, I'm going to base a reasonable royalty for infringement on a percentage of sales of modules that don't even practice the invention, we would have moved to exclude them.

[00:20:56] Speaker 03:
And Judge White noted that, too, I think in appendix 71 in his order.

[00:21:02] Speaker 03:
He said, you can't seek lost profits

[00:21:05] Speaker 05:
on the sale of a module that doesn't even practice the infringing... Yeah, but you could have sought a reasonable royalty on a module which has no use because it wasn't licensed.

[00:21:21] Speaker 05:
You could ask for a reasonable royalty.

[00:21:23] Speaker 05:
Presumably, the reasonable royalty might be quite small.

[00:21:26] Speaker 03:
It wouldn't be based on the revenues from modules that don't have anything to do with the patented functionality.

[00:21:34] Speaker 03:
In other words, let's put it in perspective.

[00:21:36] Speaker 03:
LTM is our best seller.

[00:21:38] Speaker 03:
$800 million of revenue was an issue at the beginning for LTM, which is in the report at 41.35 to 36.

[00:21:47] Speaker 03:
$245 million in revenue was for GTM.

[00:21:54] Speaker 03:
For Link Controller, the product that was accused to be a copy, it was $4 million in revenue.

[00:22:01] Speaker 03:
So to base a reasonable royalty for infringement on an $800 million of sales of a module that doesn't even practice any of the claimed functionality would have been, I'm sorry to say it's outrageous.

[00:22:17] Speaker 03:
You can't base a reasonable royalty for infringement on revenues that aren't tied to practicing the patent.

[00:22:25] Speaker 03:
And that's the problem here.

[00:22:28] Speaker 03:
I agree.

[00:22:29] Speaker 05:
I'm not sure that's true because if it has the capability and could be licensed and the customer saw some benefit in having that capability in its hands, so if it chose to get the license later, it might be appropriate to have a reasonable royalty.

[00:22:47] Speaker 05:
I think your characterization of that theory is outrageous, not correct, but that's not the same thing as saying that that was the expert's theory when the disclosure was made.

[00:22:59] Speaker 03:
The expert's theory was definitely based on the assumption that the modules, the revenues from those modules, that those modules could practice ISP load balancing.

[00:23:12] Speaker 03:
And I can certainly point you to both portions of the report and to his testimony.

[00:23:18] Speaker 03:
For example, in his testimony, he said,

[00:23:30] Speaker 03:
This is at 5531.

[00:23:35] Speaker 03:
He admitted that one of his assumptions was that LTM, quote, can perform outbound link load balancing on its own, end quote.

[00:23:44] Speaker 03:
At 5532, he said, quote, I confirmed with Dr. Rubin that it's his opinion that LTM still infringes as originally accused.

[00:23:54] Speaker 03:
And two, I understand that to the extent the jury determines that it does not infringe

[00:23:59] Speaker 03:
that it would be removed from my analysis.

[00:24:02] Speaker 03:
So he's talking about LTM and the assumption that the revenues that were generated by licensing of LTM were related to the fact that LTM could practice the invention.

[00:24:13] Speaker 03:
Now, once we know that LTM can't practice the invention, it would be improper to seek lost profits or a reasonable royalty.

[00:24:21] Speaker 01:
Just to be clear.

[00:24:26] Speaker 01:
What I understand to be going on here is that, and I think you may disagree with part of this, but that in your view, it's immaterial.

[00:24:35] Speaker 01:
He might well have been able to testify, as Judge Dyke, I think, alluded to, that somebody might have paid a certain royalty to get an LTM-only license, because down the road, that user might want to have

[00:24:54] Speaker 01:
might have thought I might add the other functionality so that I can actually do this link load balancing.

[00:25:02] Speaker 01:
But he never did that.

[00:25:04] Speaker 01:
He never said, here is my royalty rate for a currently non-functional LTM license.

[00:25:15] Speaker 01:
And if he didn't say it before, he's not going to be able to do it for the first time at trial.

[00:25:20] Speaker 01:
And hence, the assumptions of his royalty calculation are no longer accurate.

[00:25:28] Speaker 01:
And he doesn't have a royalty theory.

[00:25:30] Speaker 01:
And maybe even worse, on the lost profit side, why would somebody be buying this as a substitute for their product when the functionality isn't even there?

[00:25:43] Speaker 03:
I agree with the analysis.

[00:25:45] Speaker 03:
In terms of, to keep in mind, it's the GTM and the link controller that actually can perform the accused functionality, or the patented functionality.

[00:25:54] Speaker 03:
So the question is, would it be reasonable for him to have said, he didn't say it, and that's the main point, as you say, would it be reasonable to say, even though these other 13 modules, or I guess it's 12 modules,

[00:26:10] Speaker 03:
do not perform the accused functionality, and some of them perform functionalities that have nothing to do with even something close, their security module, for example, could have he sought a reasonable royalty or lost profits for revenues generated on sales of those modules.

[00:26:30] Speaker 03:
I think that's questionable, but I understand that perhaps it's conceptually possible, and it would be some very small minimal royalty, but that was never in his report.

[00:26:39] Speaker 03:
His report was expressly based on the assumption that the modules that he was looking at for lost profits and reasonable royalty could practice the patented functionality.

[00:26:50] Speaker 03:
And again, if it hadn't been, if it had been different, we would have moved to exclude such a theory, especially on lost profits.

[00:26:59] Speaker 03:
You get lost profits, but for the infringement, you would have made a sale.

[00:27:03] Speaker 03:
The sale of an LTM module is not even a module that practices the patent.

[00:27:09] Speaker 03:
So how can you get lost profits on the sale of a patent?

[00:27:12] Speaker 01:
I'm sorry, it does practice the patent because the patent is, and the judge held that, right, on summary judgment.

[00:27:19] Speaker 01:
It doesn't provide a functionality of interest.

[00:27:24] Speaker 01:
Well, I want to distinguish... These are infringing units as a result of an unappealed summary judgment, right?

[00:27:31] Speaker 01:
Well, because the material is in there, and therefore it's capable under whatever that broad language is.

[00:27:39] Speaker 01:
It doesn't have to be turned on for it to be infringing.

[00:27:42] Speaker 01:
Wasn't that what the district court held?

[00:27:44] Speaker 03:
Yes, but that's the big IP versus the LTM.

[00:27:47] Speaker 03:
The big IP device.

[00:27:48] Speaker 01:
Isn't the LTM just a module inside the device?

[00:27:51] Speaker 01:
Yes.

[00:27:51] Speaker 01:
And it's contained in what every single big IP

[00:27:57] Speaker 01:
everyone that's sold.

[00:27:58] Speaker 01:
Correct.

[00:27:59] Speaker 01:
So if the sale of a big IP is an active infringement.

[00:28:03] Speaker 03:
Yes, but we don't sell big IPs separately from modules.

[00:28:07] Speaker 03:
So what I'm distinguishing is the sale of the LTM module, which is priced differently than sales of other modules, for example.

[00:28:14] Speaker 03:
So the sale of the LTM module itself is not revenue related to an active infringement.

[00:28:21] Speaker 03:
I agree with you that when we deliver a big IP device, you've bought an LTM module,

[00:28:27] Speaker 03:
You bought a module that can't practice the patented functionality.

[00:28:31] Speaker 03:
You do have a box that has code in it that could practice the patented functionality.

[00:28:37] Speaker 03:
To get access to that code, you have to license GTM or link controller.

[00:28:41] Speaker 03:
And you pay for that.

[00:28:43] Speaker 03:
And if you pay for that, that would be revenue that was related to your ability to practice the patented functionality.

[00:28:53] Speaker 03:
I don't dispute that the Big IP, the product itself, has

[00:28:56] Speaker 03:
disabled, well, not enabled code in there that would allow you, if you paid for it, to get access to it.

[00:29:05] Speaker 02:
So are you raising a cross-appeal?

[00:29:07] Speaker 03:
Excuse me?

[00:29:08] Speaker 02:
Are you raising a cross-appeal?

[00:29:10] Speaker 03:
Yes.

[00:29:10] Speaker 03:
A cross-appeal, it's that the court and judge, I will say Judge White's opinions, as are evident from a review of them, are very thoughtful.

[00:29:21] Speaker 03:
He thoughtfully analyzes the evidence and his conclusions and the law.

[00:29:26] Speaker 03:
But we believe that the jury decision that the two prior art devices that we identified was against the clear weight of the evidence.

[00:29:37] Speaker 03:
That the issue is not whether these devices existed prior to the critical date.

[00:29:43] Speaker 03:
There doesn't seem to be an issue with that.

[00:29:45] Speaker 03:
The issue seems to be whether or not there was sufficient evidence that they could work as a single device.

[00:29:51] Speaker 03:
And in terms of a single device... Could it work as a single device?

[00:29:54] Speaker 05:
No, the issue was whether they were used as a single device.

[00:29:59] Speaker 03:
Or not whether they were used, because the claim constructions don't require use.

[00:30:04] Speaker 03:
In my view, there is undisputed testimony that they were capable of being used to do link load balancing.

[00:30:12] Speaker 03:
The question might be whether they were ever sold together for the purpose of being used

[00:30:20] Speaker 03:
as a single device or were ever implemented as a single device.

[00:30:25] Speaker 03:
We think that there was unrebited testimony that they were repeatedly sold and used by customers as part of the same rack.

[00:30:34] Speaker 03:
They were put in a rack.

[00:30:35] Speaker 03:
And Mr. Scheme and Mr. Needham and Mr. Thornywell all testified to that effect.

[00:30:43] Speaker 03:
I understand Judge White felt that to some extent there wasn't a clear demarcation about the timing

[00:30:50] Speaker 03:
of that, but if you read the testimony in context, it's clear that they were saying from the beginning that they did cite something from Mr. Skeen which says, when was the first time they were put together as a single device?

[00:31:04] Speaker 03:
And he said 2002, but if you read that page of testimony, he means in the same packaging.

[00:31:10] Speaker 03:
He said it's just as a form factor issue.

[00:31:12] Speaker 03:
He wasn't undermining his own testimony that since the beginning, they were intended to work together.

[00:31:19] Speaker 03:
And we're working together and use my customers for that purpose.

[00:31:24] Speaker 03:
I only have 20 seconds left.

[00:31:26] Speaker 03:
Are there any other issues the court would like me to address?

[00:31:29] Speaker 03:
Because obviously, on the primary appeal, there were a lot of issues raised.

[00:31:33] Speaker 01:
I guess since you have 16 seconds, what is the difference between a user putting in an activation code and doing whatever this

[00:31:48] Speaker 01:
catch thing is that you say was necessary in order to undo at least the second hotfix fix?

[00:31:57] Speaker 03:
That's a good question.

[00:31:59] Speaker 03:
And this is what we're left with.

[00:32:01] Speaker 03:
Lots of products can be modified to infringe, but as sold, they don't meet all the elements of a claim.

[00:32:08] Speaker 03:
And what we're dealing with here is not an indirect infringement claim.

[00:32:11] Speaker 03:
It's not that we're being accused of inducing somebody to modify the product.

[00:32:15] Speaker 03:
The issue is whether

[00:32:17] Speaker 03:
As sold, that product practices the claim.

[00:32:20] Speaker 03:
And in software cases, for example under Fingen, the issue is whether as sold it is operable or possibly capable of practicing the claim functionality.

[00:32:32] Speaker 03:
In the Fingen case, the court found that having locked modules still were capable of practicing the claim because all the customer needed to do was license those modules and unlock them.

[00:32:46] Speaker 03:
and the court in Fingen and in Fantasy Sports made the distinction that the code doesn't have to be modified.

[00:32:53] Speaker 03:
There's no modification to the code.

[00:32:56] Speaker 03:
And that is the distinction here.

[00:32:57] Speaker 05:
Well, I'm not sure.

[00:32:59] Speaker 05:
Isn't the distinction here between Fantasy Sports and Fingen where it was within the control of the customer to activate the code, to get the license.

[00:33:08] Speaker 05:
But here, it's not within the control of the customer because that license is not available domestically.

[00:33:15] Speaker 03:
I think that's an excellent point.

[00:33:17] Speaker 02:
That's not what the hotfix did, was to change the customer control?

[00:33:22] Speaker 03:
The hotfix did accomplish that because the customer could not activate that code as infringed by just buying a license.

[00:33:31] Speaker 03:
The customer has to be supplied with a hotfix, which itself has code.

[00:33:37] Speaker 03:
There's no dispute that that's code, so the code has to be modified.

[00:33:41] Speaker 03:
And that, as you mentioned,

[00:33:43] Speaker 03:
That hotfix, or that patch, I mean, is not available to US customers or even foreign customers that have a box that came from the US.

[00:33:52] Speaker 03:
It has only been made available to foreign customers who have big IPs that originated in China.

[00:33:58] Speaker 02:
Okay.

[00:33:58] Speaker 02:
Let's hear from Mr. Moreno, and if you need another moment or so, we'll find you.

[00:34:05] Speaker 04:
So the damage of this show?

[00:34:08] Speaker 04:
That's for a citation to the record for where we disclosed the Mlachowski report.

[00:34:13] Speaker 04:
So if you look at the appendix at page 55, 59, specifically lines 5 through 8, this is a brief that F5 filed in the court, saying that in response to document requests, that they have served on rather identified Mlachowski report to supplement its damages disclosure.

[00:34:32] Speaker 04:
The second point I want to make on damages is, as you heard Mr. Al-Salam refer to the testimony of Mr. Malakowski, our damages expert, he said that Mr. Malakowski confirmed that there was infringement with Professor Rubin, who was our infringement expert.

[00:34:47] Speaker 04:
And Professor Rubin told him the big IP with LTM infringes.

[00:34:51] Speaker 04:
He's exactly right.

[00:34:52] Speaker 04:
That's undisputed.

[00:34:53] Speaker 04:
The big IP with LTM infringes.

[00:34:56] Speaker 04:
Professor Rubin never considered or rendered any opinion on the issue of infringement by a single module.

[00:35:02] Speaker 04:
Any issue was never in this case.

[00:35:05] Speaker 04:
The only issue in this case was also always infringement by the big IP with all 14 modules that are under infringement in France.

[00:35:13] Speaker 04:
And that's not in dispute on this IP.

[00:35:15] Speaker 04:
So when Mr. Malakowski pointed in his own testimony, which is the basis of this whole distinction that FI grows, and he said, I confirm with Professor Rubin,

[00:35:25] Speaker 04:
That LTM infringes, of course.

[00:35:28] Speaker 04:
He was talking about the big IP with a single license to LTM.

[00:35:32] Speaker 04:
And that product, as we all know, does infringe.

[00:35:34] Speaker 04:
And that was the basis.

[00:35:35] Speaker 04:
It's not infringement by LTM by itself, which has never been produced by the one sold by FI.

[00:35:43] Speaker 04:
Now, with respect to the cross-appeal, it's two issues.

[00:35:47] Speaker 04:
Number one, FI was arguing the wrong standards.

[00:35:51] Speaker 04:
The correct standard, the Ninth Circuit Law, is no evidence.

[00:35:55] Speaker 04:
That's under the EEOC case versus Gordelli.

[00:35:57] Speaker 04:
And five, first, there's a confusion here.

[00:36:01] Speaker 04:
There's two standards of review that come into play.

[00:36:03] Speaker 04:
The trial court reviews for clear evidence.

[00:36:07] Speaker 04:
The appellate court reviews the trial court's review of that evidence for abuse of defense.

[00:36:12] Speaker 01:
Can you just talk about the substance, not the standard review.

[00:36:16] Speaker 01:
Why could the jury have found, I gather there are two, there's a Cisco thing and an F5 thing.

[00:36:24] Speaker 01:
Why could the jury have reasonably concluded, maybe that's too high a standard, that neither one of them was a single device earlier than the priority data?

[00:36:38] Speaker 04:
So exactly what Jeff White said.

[00:36:40] Speaker 04:
Jeff White pointed to the admission on the stand by Mr. Skeen that the F5 progress was first combined in 2001.

[00:36:48] Speaker 04:
That's in the appendix at page 2353.

[00:36:51] Speaker 04:
Combined by whom?

[00:36:54] Speaker 04:
The question was, do you know if the 3DNS and VKP were ever combined in a single device?

[00:36:59] Speaker 04:
So the question was completely open-ended.

[00:37:01] Speaker 04:
He said yes.

[00:37:02] Speaker 04:
Do you know about when that was?

[00:37:04] Speaker 04:
I think it was around the beginning of 2002.

[00:37:08] Speaker 05:
I'm not sure that that question is directed to what we're talking about.

[00:37:14] Speaker 05:
We're talking about a theory that, before the priority date, that these two things were

[00:37:22] Speaker 05:
separate but that they were used in proximity to one another to accomplish the functionality.

[00:37:30] Speaker 05:
Either they were combined into a single device.

[00:37:33] Speaker 04:
So this was a cross-examination right after Mr. Skinner testified on direct about that very issue.

[00:37:40] Speaker 04:
So this was a completely open-ended question that he actually answered with a date that was favorable to Radler.

[00:37:47] Speaker 01:
Was there a claim construction given of this single device?

[00:37:52] Speaker 04:
No, there was not.

[00:37:52] Speaker 01:
Yeah, so I mean, I guess part of what I kept thinking about is since the concept of a single device is essentially metaphysically uncertain, the jury could decide anything, whether it's a single device or not.

[00:38:06] Speaker 04:
Potentially, and the jury instruction also said single device.

[00:38:10] Speaker 04:
So by the way, let me say two other points because you asked the open-ended question, what evidence could they consider?

[00:38:14] Speaker 05:
What was the jury instruction?

[00:38:16] Speaker 04:
Let me give it to you.

[00:38:26] Speaker 04:
The jury instruction number 10 is from the appendix 2323.

[00:38:30] Speaker 04:
And it says, for the claim to be invalid because it is not new, all the requirements must have existed in a single device that predates.

[00:38:39] Speaker 04:
That's a standard jury instruction in the Northern District of California on anticipation, which brings me to my most important point.

[00:38:45] Speaker 04:
Anticipation cannot be shown simply by oral testimony under this court's binding precedent.

[00:38:51] Speaker 04:
It requires corroboration of documentary evidence.

[00:38:53] Speaker 04:
With respect to the Cisco problem, it's admitted in the trial record with no documentary evidence of the two devices ever being combined.

[00:39:01] Speaker 04:
That's what Judge White found in his post-trial order, and they didn't challenge that on appeal.

[00:39:06] Speaker 04:
They don't point to any documentary evidence that would supplement the testimonial evidence.

[00:39:11] Speaker 04:
And the testimonial evidence, of course, had to be weighed by the jury.

[00:39:14] Speaker 04:
We didn't have to believe what the witness said.

[00:39:17] Speaker 04:
By the way, at the time, both were F5 employees.

[00:39:20] Speaker 04:
But there's one other very fundamental point, since you asked me, what could they have relied on?

[00:39:26] Speaker 04:
That's why I didn't address this in his order.

[00:39:28] Speaker 04:
But because it's anticipation, the question of what is prior art, is it prior art, and then does the prior art mean all the elements?

[00:39:35] Speaker 04:
Obviously, it's to talk about the same thing.

[00:39:38] Speaker 04:
And what F5 does in the appeal, it talks about the two devices separately.

[00:39:42] Speaker 04:
But the two devices, in order to meet the claim limitations, had to have been combined.

[00:39:47] Speaker 04:
How did they combine them?

[00:39:49] Speaker 04:
With configuration files.

[00:39:52] Speaker 04:
And there was a definition of configuration of configured claims.

[00:39:55] Speaker 04:
It said it has to be programmed well.

[00:39:58] Speaker 04:
So what they did at trial, and we talk about this all over our position, they brought in a test bed where they sought to combine the two devices.

[00:40:06] Speaker 04:
And what did they have to do?

[00:40:08] Speaker 04:
They had to configure them or reprogram them with new software.

[00:40:12] Speaker 04:
make even an attempt to meet the claim limitation.

[00:40:15] Speaker 04:
And the testimony was unequivocal that those configuration files were created by their expert in 2014.

[00:40:22] Speaker 04:
So that element at the very least of this combined device, a single device, the configuration file which is required by the claim certainly didn't exist until 2014 during the penance of the case.

[00:40:35] Speaker 04:
Jury could have relied on that.

[00:40:38] Speaker 02:
Thank you.

[00:40:39] Speaker 02:
OK.

[00:40:39] Speaker 02:
Thank you.

[00:40:40] Speaker 02:
Thank you, Mr. Marino.

[00:40:42] Speaker 02:
Mr. Al-Salam, you have two minutes to rebuttal.

[00:40:47] Speaker 03:
So if I'm limited to the cross-appeal of this- I'm just a cross-appeal, please.

[00:40:52] Speaker 03:
And in the reference to Mr. Skeen's testimony at 1423, the question was, and I'm quoting, do you know if the 3DNS and BIG-IP were ever combined as a single device?

[00:41:04] Speaker 03:
Answer, yes.

[00:41:05] Speaker 03:
Do you know about when that was?

[00:41:07] Speaker 03:
I think it was around the beginning of 2002.

[00:41:08] Speaker 03:
But the next question, what level of difficulty did that involve to put the 3D and have some big IP into the same device?

[00:41:17] Speaker 03:
Answer, it wasn't.

[00:41:18] Speaker 03:
It wasn't anything difficult.

[00:41:20] Speaker 03:
It was mostly just packaging and putting the bits together so we could deliver one software deliverable to run on one form factor.

[00:41:28] Speaker 03:
So when Mr. Skeen was testifying us to one device, he wasn't thinking about the jury instruction or

[00:41:34] Speaker 03:
the fact that one device could mean two different modules in the same rack.

[00:41:40] Speaker 03:
He took it literally to mean that it was in one package.

[00:41:44] Speaker 03:
So that testimony didn't undermine his earlier testimony that they worked together as one device.

[00:41:50] Speaker 03:
The test beds that counsel referred to were simply provided to the jury to show that those devices were capable

[00:42:00] Speaker 03:
back in the days of the prior art of doing link load balancing.

[00:42:04] Speaker 03:
They weren't provided as prior art devices themselves.

[00:42:08] Speaker 03:
So certainly we did not have configuration files from 1998, still available in 2013.

[00:42:15] Speaker 03:
So they were... Why is that so certain?

[00:42:18] Speaker 03:
Because those products were old and outdated long, long ago.

[00:42:24] Speaker 03:
So this is 13 years later or more than that, with the time of trial.

[00:42:30] Speaker 03:
So we didn't even use the same software anymore.

[00:42:34] Speaker 03:
That no longer existed.

[00:42:36] Speaker 03:
So the expert created configuration files simply to show how they could have worked back in that time period.

[00:42:43] Speaker 03:
In terms of the cross appeal, that's all I have.

[00:42:46] Speaker 02:
OK, any more questions?

[00:42:48] Speaker 02:
Thank you.

[00:42:48] Speaker 02:
Thank you both, because you've taken a resubmission.

[00:42:51] Speaker 02:
That concludes the arguments.