[00:00:00] Speaker 00: Travel Sentry versus David Trapp, and David Trapp versus Conair et al. [00:00:05] Speaker 00: 2016-23-86. [00:00:08] Speaker 00: Mr. Hughes. [00:00:09] Speaker 03: Thank you, Your Honor, and may it please the Court, Paul Hughes, for Appellant David Trapp. [00:00:15] Speaker 03: Under Act of My Five, three points established that the Court erred in granting summary judgment. [00:00:20] Speaker 03: First, as Travel Sentry admits, TSA receives a benefit from participating in the program. [00:00:26] Speaker 03: Second, the only way for TSA to participate [00:00:30] Speaker 03: in the dual lock travel sentry system and receive the benefits of so doing is to perform the method steps at issue. [00:00:37] Speaker 03: Third, travel sentry establishes the manner of TSA's performance. [00:00:42] Speaker 03: Travel sentry designs the lock system, designs the keys, and provides the literal keys that TSA needs. [00:00:49] Speaker 03: Without those keys, TSA cannot perform. [00:00:52] Speaker 01: So let's start with the benefits. [00:00:53] Speaker 01: So what evidence in the record other than your speculation that they must be happy about this [00:00:59] Speaker 01: Is there that TSA receives a benefit or views it as a benefit? [00:01:04] Speaker 03: Sure, Your Honor. [00:01:04] Speaker 03: I can point two different directions. [00:01:06] Speaker 03: The first is to Travel Sentry's brief to this court, and then to their undisputed statement of facts that Travel Sentry submitted. [00:01:12] Speaker 03: So first, to start with, Travel Sentry's brief to this court. [00:01:16] Speaker 03: At page four of their brief, describing the new Travel Sentry system as compared to the prior non-infringing alternatives, Travel Sentry says, quote, this new standard which streamlined the opening of locks during screening [00:01:28] Speaker 03: it would be more efficient than the cumbersome TSA key ring program. [00:01:32] Speaker 03: That's in their brief. [00:01:33] Speaker 03: They say that's the benefit the TSA receives as opposed to the non-infringing alternatives is more efficiency. [00:01:41] Speaker 01: Again, the fact that there might be a conceivable benefit. [00:01:46] Speaker 01: The cases that we have that talk about how this relationship generally works under 271A is where a purchaser is seeking out a benefit [00:01:57] Speaker 01: and the right to get that benefit is conditioned, not on the notion that somehow something the seller is doing might eke over into a benefit for someone. [00:02:08] Speaker 03: Well, Your Honor, a few things about that. [00:02:10] Speaker 03: And I'll move to the statement of undisputed facts in just a moment. [00:02:12] Speaker 03: But the reason that TSA has agreed to sign the memorandum of understanding, the reason that they train their thousands of workers around the country and that they have thousands of these travel century keys that they must keep track of, that they need replacements, is because they view that there is a benefit from using [00:02:27] Speaker 03: this system as opposed to their alternative means of screening luggage, such as... When you say the reason is, how do you know that? [00:02:33] Speaker 01: I mean, did you take a deposition of that? [00:02:36] Speaker 03: Well, Your Honor, this is, of course, this is a question of fact, as Akamai 5 says, and the question is, could a jury infer that TSA has a benefit? [00:02:43] Speaker 03: Is there a basis in the record that a jury could enter that inference? [00:02:47] Speaker 01: So you're just arguing that there's a material issue of fact that you want an opportunity to go to the jury on? [00:02:53] Speaker 03: Absolutely, Your Honor, and that's why the grant of summary judgment was incorrect. [00:02:56] Speaker 01: Did they ever adopt a standard similar to that contemplated in the MLU? [00:03:01] Speaker 03: Well, yes, Your Honor. [00:03:02] Speaker 03: And they used the travel sentry system on a very regular basis. [00:03:06] Speaker 03: That system is absolutely operationalized. [00:03:08] Speaker 03: If I can point the court to appendix page 689, this is travel sentry's own statement of undisputed fact. [00:03:18] Speaker 03: At paragraph 13 of travel sentry's statement of undisputed fact, [00:03:23] Speaker 03: They describe the problems that TSA would have performing the luggage screening mandate without using the Travel Century system. [00:03:33] Speaker 03: And that at the bottom of paragraph 13, they say, quote, the lock-breaking policy would increase the risk of injury to luggage screeners and the likelihood of claims of theft and pilfering by traveling passengers. [00:03:43] Speaker 03: And then continuing to paragraph 14, Vermily, he is the chief executive officer of Travel Century, the founding force behind Travel Century. [00:03:51] Speaker 03: had several discussions about potential solutions to lock luggage issue with TSA employees throughout his time at TSA. [00:03:58] Speaker 03: During these conversations, Vermily stated that airline travelers and the TSA would benefit from a system by which the TSA maintained a set of master keys that could access a significant percentage of the locks affixed to passengers' checked baggage. [00:04:11] Speaker 02: Can I ask you this to turn from the benefit question to the condition of the benefit question? [00:04:21] Speaker 02: What evidence, if any, is there that Travel Century would withhold anything from TSA if TSA, on occasion, regularly, for a year at a time, didn't perform this last step? [00:04:40] Speaker 03: So two answers to that, Your Honor. [00:04:41] Speaker 03: I'll start with a factional answer and then a legal response, because I'm not sure that's a required showing. [00:04:46] Speaker 03: But even if it is, we certainly have the evidence of that. [00:04:49] Speaker 03: At page five of Travel Century's brief, they describe the lead up to launching their system. [00:04:55] Speaker 03: And they explain that before they ever made these locks available to the public, before they marketed them, the first things they did was receive an oral agreement in August of 2003 from Travel Century. [00:05:06] Speaker 03: And that's described at page three of their brief, as well as in their statement of undisputed facts at appendix page 695 to 696. [00:05:16] Speaker 03: Then in October of 2003, they obtained a signed memorandum of understanding, where TSA reduced to writing, saying, if you create this system, we will use our best efforts to, in fact, use the lock system. [00:05:31] Speaker 03: Travel Century... That's not a binding contract, though. [00:05:33] Speaker 01: Didn't we already address that MOU? [00:05:35] Speaker 03: Well, no, Your Honor, it's not a binding contract. [00:05:37] Speaker 03: And the court did address that, but that was under a very different legal standard prior to Akamai 5. [00:05:41] Speaker 03: That was when Akamai 1, BMC, and Mooney Action governed. [00:05:46] Speaker 03: The reason that Travel Sentry actually created the system, that they did the marketing, that they made the locks come into existence, was because TSA agreed that if Travel Sentry did those first few steps, that the TSA would make good faith efforts to do the later steps. [00:06:02] Speaker 03: Now, you're on your right, there's no binding contractual obligation. [00:06:05] Speaker 03: They cannot go to court to sue them to do so. [00:06:08] Speaker 03: But that, I think, was the whole point of Akamai 5, because under Akamai 1, [00:06:12] Speaker 03: The court said the decisive factor was there was no contractual obligation that limelight customers must tag. [00:06:18] Speaker 03: It was simply that if the limelight customers wanted to receive the benefits from using the limelight system, they had to tag, they had to perform the method steps. [00:06:26] Speaker 03: Is the MOU even still in place? [00:06:28] Speaker 03: I believe it is, Your Honor. [00:06:29] Speaker 03: I don't think there's any expiration of that. [00:06:32] Speaker 03: And of course, what we're seeking here is, in large part, retroactive damages for what's already occurred when the MOU was certainly under place. [00:06:39] Speaker 03: But I have no understanding that the MOU has [00:06:41] Speaker 02: Just as a factual matter, it seems, tell me if this is wrong, that, again, just as a factual matter, that this case is different from Limelight in that in Limelight, Limelight said to a content site, I forget what they were called, content provider or something, on any given occasion, if you don't tag, you don't deal with us. [00:07:05] Speaker 02: You don't get to move your stuff onto our localized servers. [00:07:11] Speaker 02: That's not what's going on here. [00:07:13] Speaker 02: You have to rely on a more systemic notion that if TSA said to Travel Century, either never or quite generally or something, we won't perform the last step, Travel Century. [00:07:27] Speaker 02: I mean, actually, we're not going to provide you keys anymore. [00:07:33] Speaker 02: Maybe we just go out of business, because our whole business is about you. [00:07:37] Speaker 02: But it's not an individual [00:07:40] Speaker 02: you get a benefit TSA by performing this step because on this occasion we have said we will give this thing to you and if you don't do this step we won't give this thing to you. [00:07:53] Speaker 03: I mean, Your Honor, a few things to say about that. [00:07:55] Speaker 03: I don't see why that would be a material distinction from what Akamai 5 held because if Akamai 5 had said the way the Akamai system worked there could be hundreds or thousands or tens of thousands of each of their customers of individual tags [00:08:08] Speaker 03: And I suppose it's the case that Akamai could say, we won't give you one tag, but we'll give you the other 9,999 tags. [00:08:14] Speaker 03: But I don't think that would have changed the analysis in Akamai. [00:08:17] Speaker 03: The question was simply if. [00:08:19] Speaker 02: No, I think in Akamai, Limelight, in order to say, you as content provider get to put this thing, part of your website on our local server to speed up the process, you have to tag it, this individual one. [00:08:36] Speaker 03: You have to use a particular tag. [00:08:38] Speaker 03: That's right. [00:08:38] Speaker 03: But I don't think any different in kind here to say, TSA, if you wish to open this bag and screen this bag using our program. [00:08:46] Speaker 02: You already have the key, right? [00:08:48] Speaker 03: That's right. [00:08:48] Speaker 03: They already have the key. [00:08:49] Speaker 02: They have the key. [00:08:50] Speaker 02: On an individual screening by screening basis, TSA doesn't need to get anything new from Travel Central. [00:09:01] Speaker 03: Well, with Limelight, Your Honor, my understanding is that the tagging system was pre-established, that Limelight created the method for tagging. [00:09:09] Speaker 03: They provided that method of tagging to the customers. [00:09:12] Speaker 03: The provider needs to do the tagging in the individual case. [00:09:15] Speaker 03: That's true. [00:09:15] Speaker 03: They needed to take what I think is a digital key, that tag, and use it on that particular content to get the benefit. [00:09:22] Speaker 03: But that's no different from the keys here that Travel Sentry has provided to TSA. [00:09:27] Speaker 03: They've provided the keys. [00:09:28] Speaker 03: They need to use those individualized keys. [00:09:30] Speaker 03: on each piece of luggage in order to get the benefit from that participation of the program on an individualized basis. [00:09:38] Speaker 03: It is true of Travel Sentry, it goes out of business if Travel Sentry stops providing the replacement keys, if they stop providing new keys because sometimes they have to change the locks or add new kinds of locks and new kinds of keys. [00:09:49] Speaker 03: If they don't provide that to TSA, TSA would no longer receive the benefit or no longer be able to use the program. [00:09:55] Speaker 03: So there is the conditioning [00:09:57] Speaker 03: that occurs here, I think, in no different way, or not a materially different way, from what happened in Akamai. [00:10:04] Speaker 03: So I think this case is squarely governed. [00:10:07] Speaker 01: So you're saying that each time they use the key, they get an incremental benefit. [00:10:12] Speaker 03: Yes, Your Honor. [00:10:13] Speaker 03: Each time they use the key, that's an alternative to having to clip the lock, which Travel Sentry itself says is an incremental benefit from the alternatives. [00:10:22] Speaker 02: I guess just the point that I'm focusing on is a factual difference, and then the question is, does the factual difference matter, is that each time TSA gets a bag with one of these and decides we're going to use the key, we're going to use the bolt cutters, Travel Sentry is not doing anything at that moment to say, we suddenly take something away from you if you don't do the right thing. [00:10:47] Speaker 03: But, Your Honor, I don't think Limelight was doing something at that moment either. [00:10:50] Speaker 03: Limelight provides to its [00:10:52] Speaker 03: It's customers, here's the instructions, here's how you tag. [00:10:55] Speaker 03: It's customers who have hundreds or thousands of web pages that have tens of thousands of individual embedded objects within them. [00:11:02] Speaker 03: It's not every object they go to Limelight and say, give me a tag for this object. [00:11:05] Speaker 03: It is Limelight says, here's the method for tagging. [00:11:08] Speaker 03: Here's going to be your digital key. [00:11:10] Speaker 03: You have to embed this key into your object. [00:11:13] Speaker 02: I thought in Limelight, Limelight won't accept the relevant content without the tag. [00:11:20] Speaker 02: But that's right, but the tag has been pre-established. [00:11:22] Speaker 02: Yes, but what Limelight is actually providing is a hosting service on its server so that the speed of acquisition by a user is greater. [00:11:32] Speaker 02: And that Limelight won't do tag by tag by tag by tag. [00:11:38] Speaker 02: Unless the tag comes in, it doesn't provide the space on the localized server. [00:11:43] Speaker 03: That's right, it has to have the right tag that Limelight... That's not what's happening with Travel Sentry. [00:11:47] Speaker 02: Any given [00:11:48] Speaker 02: choice of TSA to use the key is one that doesn't depend on getting anything new from Travel Sentry. [00:11:56] Speaker 03: It's not anything new, but it depends on getting something from Travel Sentry. [00:12:00] Speaker 03: But it's not a new tag in each case, I don't believe, in Limelight. [00:12:03] Speaker 03: It is the directions for tagging. [00:12:05] Speaker 03: It is the same tag with perhaps additional... New server space. [00:12:09] Speaker 03: Perhaps it's new server space. [00:12:10] Speaker 03: But to the extent that the point is that Limelight does something after [00:12:16] Speaker 03: the customer tags. [00:12:18] Speaker 03: I think that's just an observation that there are additional steps potentially in the Akamai process, whereas the step that's at issue here where we seek attribution is the last step in the patented process, the identifying and the unlocking step. [00:12:32] Speaker 00: And I don't think there's anything... You're in your rebuttal time. [00:12:35] Speaker 00: Do you wish to save it or...? [00:12:38] Speaker 03: Yes, Your Honor. [00:12:38] Speaker 03: I'll save my rebuttal time for questions. [00:12:40] Speaker 00: Thank you. [00:12:48] Speaker 04: Morning, Your Honors. [00:12:49] Speaker 04: May it please the Court William Prickett on behalf of the appellees and cross-appellants. [00:12:53] Speaker 04: I'd like to start with the condition and manner test where we just left off. [00:12:57] Speaker 04: And the district court here held that there were no facts that supported the condition and manner test. [00:13:03] Speaker 04: Indeed, that the test is completely an opposite here. [00:13:05] Speaker 04: And the reason why that decision was correct and why Tropp's arguments here are without merit is because Tropp does not, and indeed he cannot, identify what conditions [00:13:17] Speaker 04: travel century sets to the TSA or any benefit that it receives when it performs the last two steps of Tropp's. [00:13:26] Speaker 02: Isn't it essentially plain that it gets a benefit of the sort that was just described? [00:13:34] Speaker 04: That the TSA gets a benefit? [00:13:35] Speaker 04: Yeah. [00:13:35] Speaker 04: Well, Tropp actually doesn't identify any facts in the record. [00:13:38] Speaker 04: He identifies statements by him that the TSA gets a benefit, but there's really actually nothing [00:13:45] Speaker 04: in the record that supports that. [00:13:47] Speaker 01: Do you have admissions? [00:13:48] Speaker 01: I mean, there are admissions both in your arguments and in your own statement of facts that describe your process. [00:13:56] Speaker 01: Right. [00:13:56] Speaker 01: And so, I mean, isn't that enough to get past summary judgment? [00:13:59] Speaker 01: Because you admit that they're getting a material benefit. [00:14:03] Speaker 04: I don't think it is, Your Honor. [00:14:04] Speaker 04: And the reason is because there must be a conditioning of the benefit. [00:14:08] Speaker 04: And there is no conditioning here. [00:14:09] Speaker 04: To the extent there is any benefit here, it's not conditioned by travel century. [00:14:14] Speaker 04: There's nothing that Travel Sentry does here that can either prevent that benefit from occurring or encouraging that benefit from occurring. [00:14:22] Speaker 02: At a systemic level, surely there is. [00:14:25] Speaker 02: They provide the keys that avoid the possible complaints from customers about pilfering and destruction. [00:14:33] Speaker 02: And TSA presumably, probably a jury could find, entered into this memorandum of understanding because TSA [00:14:43] Speaker 02: benefits from a marginally happier class of travelers. [00:14:50] Speaker 04: That may be the case, but it is not any benefit that travel sentry has conditioned. [00:14:55] Speaker 02: You provide the keys. [00:14:57] Speaker 02: At the systemic level, you do condition the benefit. [00:15:00] Speaker 02: If you were to withdraw the keys from TSA, they wouldn't get that benefit. [00:15:07] Speaker 04: We disagree with that, Judge Toronto, for the following reasons. [00:15:10] Speaker 04: There is nothing preventing, there's nothing in the MOU that prevents the TSA. [00:15:13] Speaker 04: If we were to just say we're out of business, we're no longer going to provide any keys. [00:15:17] Speaker 04: There's nothing in the MOU that says the TSA can't contract to have keys made, to contract to have locks made. [00:15:25] Speaker 04: So there's nothing precluding the TSA from meeting its needs if it so chooses, if it's in a position where it has to. [00:15:36] Speaker 01: So the key is here that... So you're saying once you put your luggage out there with the locks on them that somehow there's been an exhaustion of any patentable protection because anybody could break into those locks? [00:15:53] Speaker 04: I'm not sure I understand your question. [00:15:55] Speaker 01: I wasn't quite sure I understood what you said either. [00:15:57] Speaker 01: That's the problem. [00:15:58] Speaker 04: So I think that the point here is that there must be a condition imposed by travel sentry. [00:16:04] Speaker 04: in order for the condition and manner test to be met. [00:16:07] Speaker 04: Tribal Sentry does not provide any conditions. [00:16:10] Speaker 04: It does not say to the TSA, we are not going to provide any assistance unless you screen in a particular way. [00:16:17] Speaker 04: We do not say to the TSA, we're going to withhold keys or not replace keys unless you screen luggage in a particular way. [00:16:25] Speaker 04: And that is why this case is completely different than both the Akamai case and the Eli Lilly case. [00:16:33] Speaker 00: Counsel, the district court said the question here is whether Akamai 5 has expanded the scope of direct infringement. [00:16:43] Speaker 00: Court finds that it has not. [00:16:45] Speaker 00: Do you agree with that? [00:16:47] Speaker 04: I think you need to read the entire district court decision. [00:16:50] Speaker 04: In fact, the next sentence of the district court decision says, at least as is relevant here, it does not expand. [00:16:57] Speaker 04: So the district court correctly acknowledges that there is an expansion. [00:17:02] Speaker 04: It refers to it as a codicil. [00:17:03] Speaker 04: But I think the point that this report makes is that the expansion is utterly irrelevant in this case because there is no conditioning that Travel Sentry, there are no strings that Travel Sentry puts out there. [00:17:15] Speaker 04: It's unlike Akamai where Limelight said to its customers, we are not going to perform our service unless you tag in a very specific way, unless you do that. [00:17:23] Speaker 04: That's the way in which Akamai... Yes. [00:17:26] Speaker 02: What does the record say about the matter that I think you were discussing [00:17:32] Speaker 02: Judge O'Malley before, whether if travel sentry put out these bags with the dual locks, TSA could go and figure out on its own how to make a key to do its own unlocking and doesn't really require travel sentry to supply it with the keys. [00:17:55] Speaker 04: That's actually not in the record. [00:17:57] Speaker 04: And TRAAP doesn't cite anything that would show that there is any kind of conditioning. [00:18:02] Speaker 04: in terms of the TSA understanding how the method works. [00:18:08] Speaker 02: Obviously I'm very focused on the conditioning aspect and it seems to me that if it were the case that TSA couldn't get what I'm going to assume for purposes of this question is in fact a benefit it wants, the marginally happier travelers, that couldn't get it without getting keys [00:18:31] Speaker 02: from Travel Sentry, then at some level there is a kind of conditioning. [00:18:35] Speaker 02: And part of what I think you were trying to say in response was nothing stops TSA from going and making its own keys. [00:18:44] Speaker 02: Is there something in the record about that factual assertion on your part? [00:18:48] Speaker 02: Nothing stops them or whether this is something that needs the secure information from Travel Sentry? [00:18:54] Speaker 04: not in so many words. [00:18:56] Speaker 04: My point is that the MOU, which is in the record, does not preclude the TSA from doing so, and that's the point I'm making. [00:19:04] Speaker 01: But the MOU does reflect that the parties view a joint benefit occurring in this circumstance, correct? [00:19:12] Speaker 04: I don't read the MOU to say that. [00:19:14] Speaker 04: The MOU, basically under the MOU, we are gratis providing these keys. [00:19:19] Speaker 04: There's no string attached to our provision of [00:19:22] Speaker 04: of assistance to the TSA. [00:19:25] Speaker 01: Do you know if the TSA has adopted the standard that is contemplated in the MOU? [00:19:29] Speaker 04: We actually don't know for a factual matter because it's undisputed that the TSA as a large bureaucratic agency sets its own procedures, including the way it screens luggage. [00:19:40] Speaker 04: That's undisputed. [00:19:42] Speaker 04: But we do not know, we don't have a copy of those procedures because they're SSI, security sensitive information under the online security act. [00:19:50] Speaker 04: So we don't [00:19:51] Speaker 04: have that fact. [00:19:52] Speaker 04: We assume it to be the case. [00:19:55] Speaker 04: But we don't know that. [00:19:58] Speaker 04: Now, I'd like to turn. [00:20:01] Speaker 01: Is SMOU still in place? [00:20:03] Speaker 04: Yes, it is, Your Honor. [00:20:05] Speaker 02: So one reason I guess I'm interested in this question about whether TSA could supply itself [00:20:17] Speaker 02: with the materials, the keys necessary to do its part is that that seems to be the second half of the description in the parenthetical to the citation of Grokster that comes in Akamai 5. [00:20:33] Speaker 02: Right after the crucial sentence in Akamai 5, it says CF MGM against Grokster, parenthesis, vicarious liability and copyright if you're making a profit and you could stop the behavior if you wanted to. [00:20:47] Speaker 02: And presumably, the making a profit part applies here. [00:20:53] Speaker 02: But they could stop. [00:20:55] Speaker 02: The other party's behavior point seems to depend on whether TSA here could simplify and make its own keys. [00:21:09] Speaker 04: I agree with that completely. [00:21:11] Speaker 02: But we just don't know that one way or the other. [00:21:14] Speaker 04: There's nothing in the record suggesting otherwise. [00:21:16] Speaker 04: that they can't. [00:21:18] Speaker 04: So I think it's a fair presumption to be made for purposes of whether or not the condition in manor test has been satisfied here. [00:21:25] Speaker 04: And the district court actually nailed it by holding that it was completely in absent here, because travel sentry simply does not have the control over the process that Limelight had in Akamai and that the doctors had in the Eli Lilly case. [00:21:40] Speaker 04: In Eli Lilly, [00:21:42] Speaker 04: The patients were told very clearly, if you do not follow this very specific vitamin regimen, we are not going to provide the chemotherapy. [00:21:49] Speaker 04: That is not what's going on here. [00:21:50] Speaker 04: We never say to TSA, we're not going to do this or that unless you screen luggage in a particular way. [00:21:55] Speaker 04: They operate independently. [00:21:57] Speaker 04: At most, what we have here is the hypothetical that was noted in Akamai, as well as Eli Lilly, that this is just mere guidance and instruction. [00:22:05] Speaker 04: But without more, the conditioning manner test is not met. [00:22:10] Speaker 04: I'd like to turn to the two other tort theories that Tropp raises in his brief, knowing contribution and intentional causation. [00:22:21] Speaker 04: At the outset, it's our position that those have been waived because they were not raised below. [00:22:26] Speaker 04: Tropp argues here that they're not waived because they are purely legal arguments and, as such, are permitted to be made for the first time on appeal. [00:22:37] Speaker 04: Our problem with that, Your Honors, is that these are not pure legal arguments. [00:22:41] Speaker 04: They also have elements of fact. [00:22:45] Speaker 04: And in fact, the nomenclature that TROP uses demonstrate that. [00:22:51] Speaker 04: Knowing contribution, intentional causation, the district court would have had to make findings of fact with regard to the state of mind of travel sentry. [00:22:59] Speaker 04: And of course, it didn't, because those arguments were not raised below. [00:23:03] Speaker 04: And for that reason, they are a way [00:23:06] Speaker 02: But even if they're not waived, they'd... I don't remember the details of Lee against Escondido County. [00:23:15] Speaker 02: Were the two theories there only one of two different taking series? [00:23:21] Speaker 02: I don't remember which way it went, regulatory and per se or per se and regulatory. [00:23:25] Speaker 02: And the Supreme Court said, as long as you're talking takings, you can start talking about the other one, the one you didn't talk about in the lower court. [00:23:34] Speaker 02: Was the second theory completely fact independent there? [00:23:39] Speaker 04: I'm sorry, Your Honor. [00:23:40] Speaker 04: Neither of these theories was addressed in lower court. [00:23:44] Speaker 02: No, no. [00:23:45] Speaker 02: They rely on the principle from the Supreme Court's case, I think E against Escondido County, that said, we're going to let you make takings theory number two, even though you made takings theory number one only in the district court. [00:23:59] Speaker 02: And you just made [00:24:00] Speaker 02: a distinction saying that kind of doesn't apply here because here the theory number two is factual and not just legal. [00:24:08] Speaker 02: And I guess my question is, was that not also true in Escondido County? [00:24:13] Speaker 04: I don't think so. [00:24:14] Speaker 04: I don't think that the fact of state of mind was at issue in that case. [00:24:20] Speaker 04: And it would be the case here. [00:24:22] Speaker 04: Indeed, Trop argues that both of these new theories require knowledge. [00:24:28] Speaker 01: State of mind. [00:24:29] Speaker 01: I mean, the point is, did each takings theory turn on the same exact set of facts, or could taking under one theory require a different factual scenario or assessment of different facts in order to prevail? [00:24:50] Speaker 04: I think in the Supreme Court decision, it did not require that. [00:24:53] Speaker 04: Whereas here, I think it would. [00:24:55] Speaker 04: But let me turn to the... What's wrong with the theories? [00:24:58] Speaker 04: The theory. [00:25:00] Speaker 04: The problem is that the way Tropp describes them, first of all he describes them as well established and they actually appear to be pulled together from their statements because there's no case or treatise that he cites that actually identifies them as such. [00:25:15] Speaker 04: But in any event, they are either, as described by Tropp, concerted action, joint tort concerted action where there's joint and several liability, or they are [00:25:27] Speaker 04: every case that he cites for the intentional causation theory as identified by Drop, where there are multiple actors being considered by the court, they are either in an employment context or an agency context. [00:25:42] Speaker 01: Because without that type of relationship... He never really applied vicarious liability in a divided infringement context before. [00:25:51] Speaker 01: So the notion that we said we would look at [00:25:56] Speaker 01: other attribution theories on a case-by-case basis. [00:26:00] Speaker 01: So the fact that they've never been applied in this context doesn't mean much to me, since we haven't seen a lot of these cases. [00:26:09] Speaker 01: We never before, after my five, even discussed applying vicarious liability in this context. [00:26:16] Speaker 04: I see my time is in reserve time. [00:26:18] Speaker 04: I'm happy to answer the question now, or? [00:26:20] Speaker 00: Well, you're reserving time for your cross-appeal. [00:26:23] Speaker 04: Correct, Your Honor. [00:26:24] Speaker 00: You can, I think you should answer [00:26:26] Speaker 04: I will answer that question. [00:26:27] Speaker 04: I think the court certainly en banc did make that statement that there are other potential factual scenarios. [00:26:33] Speaker 04: This is not one of them. [00:26:34] Speaker 04: This is not that case. [00:26:36] Speaker 04: It's our view that in this context where you've got an independent governmental agency where a party is seeking to attribute that agency's acts to a private actor, absent a contractual obligation on the part of the government, I can't see how this court could set a precedent where [00:26:56] Speaker 04: a private actor is vicariously liable for the independent acts of a governmental agency. [00:27:01] Speaker 04: So this is not that case. [00:27:03] Speaker 04: Thank you. [00:27:04] Speaker 00: Save your time if there is something to rebut. [00:27:10] Speaker 00: Mr. Hughes has a little two and a half minutes. [00:27:19] Speaker 03: Thank you, Your Honor. [00:27:20] Speaker 03: I'd like to start with a quick legal point and hopefully make three brief factual points. [00:27:24] Speaker 03: The legal point in terms of the conditioning analysis, I think what ACMEI-5 requires is that in order to get the benefit, that the only way to get the benefit is to perform the remaining method steps for which there's attribution. [00:27:38] Speaker 03: That was lacking in MedGraph because there was an alternative way to get the benefit without performing the necessary method steps. [00:27:43] Speaker 03: That's not the case here. [00:27:44] Speaker 03: The only way for TSA to get the benefit... How do we know that? [00:27:47] Speaker 02: I guess I just want to keep harping on the point that I spent so much time talking with your friend about [00:27:54] Speaker 02: What does the record say about whether TSA could make its own keys? [00:28:04] Speaker 03: Before we get there, Your Honor, I think even if TSA could make their own keys, there would still be attribution under Act of My Five, because the only way that they can get the benefit of the system that Travel Sentry has created is by completing the method steps, even if they get the keys through [00:28:19] Speaker 03: their own creation. [00:28:21] Speaker 03: So putting that aside, the question about creating the keys. [00:28:24] Speaker 03: This is a trademark system. [00:28:26] Speaker 03: The keys that Travel Century designs correspond to their trademark, the red diamond that goes on the lock. [00:28:32] Speaker 03: This system only works if you have access to the trademark, the red diamond system. [00:28:38] Speaker 03: The key manufacturers then are told by Travel Century, or the lock manufacturers, this is what the locking mechanism looks like to correspond to our trademark that we license to put on the system. [00:28:49] Speaker 03: So Travel Sentry necessarily controls this system by virtue of the trademark identification structure. [00:28:57] Speaker 03: Without that trademark, the system doesn't operate. [00:29:00] Speaker 03: So Travel Sentry necessarily controls what the key structure looks like. [00:29:04] Speaker 03: They design the keys, they set the locking system. [00:29:07] Speaker 03: TSA now has to get those keys. [00:29:10] Speaker 03: They get them as a factual matter from Travel Sentry. [00:29:13] Speaker 03: If we hypothetically imagine that they got them some other way, that they reverse engineered the locks, [00:29:18] Speaker 03: I don't think that would be a material factual difference. [00:29:21] Speaker 03: I think there still would be attribution. [00:29:22] Speaker 03: But as a matter of fact, we know they get the keys from Travel Century. [00:29:27] Speaker 02: My question is what the record says about whether they can get the keys from somebody other than Travel Century. [00:29:35] Speaker 03: Your Honor, there's no evidence in the record whatsoever that they could get keys. [00:29:38] Speaker 03: If that were an argument that were probative to this analysis, perhaps it's one that [00:29:43] Speaker 03: travel-centric and press to a jury but there's certainly no basis in the factual record to say that this is the that would be the only way or that's even a possible way there's no basis that summary judgment could be affirmed I think on that basis given the lack of anything in the record that they would go to that point thank you mr. Hughes and mr. Prickett there is nothing to rebut yes that's the cross-appeal but you would be arguing here in rebuttal what was [00:30:12] Speaker 00: And nothing was said about this. [00:30:15] Speaker 00: We will conclude the argument on this case. [00:30:19] Speaker 00: We'll take it under revisement.