[00:00:00] Speaker 02:
The next case for argument is IQE versus New Court FAB, number 24-1124.

[00:00:04] Speaker 02:
Mr. Lloyd, when you're ready.

[00:00:09] Speaker 03:
Good morning, Your Honors.

[00:00:10] Speaker 03:
May it please the Court.

[00:00:11] Speaker 03:
My name is Adam Lloyd on behalf of the Defendant Appellant Tower Entities.

[00:00:14] Speaker 03:
I'd like to reserve five minutes for rebuttal.

[00:00:17] Speaker 03:
I first want to address the threshold issue of jurisdiction, given IQE raised that, and then unsuccessful motion to dismiss, and then again in its briefs.

[00:00:26] Speaker 03:
We think the issue of this court's jurisdiction is actually pretty straightforward in this case, because this appeal comes to this court by way of transfer from the Ninth Circuit, and thus the US Supreme Court's Christensen decision controls.

[00:00:39] Speaker 03:
To transfer here under 1631, the Ninth Circuit was required to and did find two things.

[00:00:45] Speaker 03:
First, that the Federal Circuit would have had jurisdiction at the time that this appeal was filed, and two, that the transfer would be in the interest of justice.

[00:00:52] Speaker 03:
The Ninth Circuit determined both of these were satisfied.

[00:00:55] Speaker 03:
They analyzed whether this court would have jurisdiction under 1295A, which states that this court has appellate jurisdiction over final decisions and actions arising under patent law.

[00:01:06] Speaker 03:
It determined that a denial under longstanding Ninth Circuit precedent, the denial of an anti-SLAP motion, is a final decision under the collateral order doctrine.

[00:01:17] Speaker 03:
and then determined that this action arises under patent law because they asserted a claim under 256.

[00:01:24] Speaker 03:
They also determined as part of the interest of justice analysis that our appeal in the Ninth Circuit, there was no evidence of wrongdoing, no bad faith, and then held that the Federal Circuit, not this court, has jurisdiction over the merits of the appeal.

[00:01:37] Speaker 02:
Whose law applies to whether this is a final decision under the collateral order doctrine, the Ninth Circuit or our law?

[00:01:44] Speaker 02:
the night here under Christiansen you would defer to the no no no just set aside Christian because if we had binding precedent that said this kind of collateral order is our law and it's not a final order and

[00:02:00] Speaker 02:
under Christians and we would probably re-transfer it.

[00:02:04] Speaker 02:
So the question is, does Ninth Circuit law apply to what's a final, whether this is a final order under the collateral order doctrine or us?

[00:02:13] Speaker 02:
And we don't have any law on that.

[00:02:15] Speaker 03:
Yeah.

[00:02:16] Speaker 03:
And that's, because there's no law here, I would think you would still look to the Ninth Circuit's law as persuasive authority in California law.

[00:02:22] Speaker 02:
That's not the question I'm asking you.

[00:02:25] Speaker 02:
We get this question all the time.

[00:02:27] Speaker 02:
when we have issues like this.

[00:02:29] Speaker 02:
Is it the regional circuit law, or is it our law?

[00:02:32] Speaker 03:
Well, it's not an issue unique to patent law, so under allergy and the case law, under that line of case law, we would say you defer to the regional circuit.

[00:02:41] Speaker 04:
OK.

[00:02:41] Speaker 04:
What about the Dupuy-Synthes case?

[00:02:44] Speaker 04:
You didn't address it.

[00:02:45] Speaker 04:
It's cited in the red brief at 14, which seems to say exactly the opposite of the answer you just gave.

[00:02:52] Speaker 04:
We said there in a binding precedent, questions of our jurisdiction are governed by federal circuit law.

[00:02:58] Speaker 03:
So I would say in response to that, the question of whether California's anti-SLAP law conflicts with the federal rules so as to apply at all is a question that is not unique to patent law, and that's not a jurisdictional question.

[00:03:10] Speaker 03:
That's a question of whether it conflicts with the federal rules.

[00:03:12] Speaker 03:
You do defer to the regional circuit there.

[00:03:14] Speaker 03:
And so that's your starting place, that California's anti-SLAP law applies in federal court.

[00:03:20] Speaker 03:
And then so the question is,

[00:03:21] Speaker 03:
Is it a collateral order?

[00:03:25] Speaker 03:
And here, we would say you would defer to the regional circuit, because that is, again, it's not an issue unique to that.

[00:03:33] Speaker 04:
I'm confused.

[00:03:33] Speaker 04:
Why isn't the starting point, as it is in every case, do we have jurisdiction?

[00:03:39] Speaker 04:
Subject matter jurisdiction is undisputed now.

[00:03:41] Speaker 04:
But do we have appellate jurisdiction?

[00:03:43] Speaker 04:
And in Dupuis' sentence, we said, when the parties dispute that, the answer is governed by federal circuit law.

[00:03:50] Speaker 04:
Isn't that where we start?

[00:03:51] Speaker 03:
Yes, but I'm just saying, OK, yes, we start with whether this court has jurisdiction.

[00:03:55] Speaker 03:
But then the next step of that analysis is, OK, starting with, does the Santa Slap apply in federal court at all?

[00:04:02] Speaker 03:
Yes.

[00:04:03] Speaker 03:
And then you ask, OK, given that it does, is it a collateral order?

[00:04:10] Speaker 04:
But I'm missing somewhere a step.

[00:04:14] Speaker 04:
What law do we apply, federal circuit law or non-circuit law?

[00:04:17] Speaker 03:
Well, I would say, under the de

[00:04:21] Speaker 03:
There is no federal circuit law to apply here.

[00:04:24] Speaker 02:
So as to whether that doesn't answer the question.

[00:04:28] Speaker 02:
If we haven't decided it yet, but it's a question of our law, then we have to decide it on our own.

[00:04:34] Speaker 02:
Just because we haven't reached a certain issue doesn't mean it's not our law and we just follow whatever the regional circuit did.

[00:04:44] Speaker 02:
We could disagree with the regional circuit if it's our question.

[00:04:49] Speaker 03:
I would say that

[00:04:51] Speaker 03:
Yes, I mean, the under, I guess the issue you guys, it sounds like that you have with the Ninth Circuit.

[00:04:57] Speaker 02:
It's not really appropriate to refer to the court as you guys.

[00:05:00] Speaker 03:
Sorry.

[00:05:02] Speaker 03:
My apologies, Your Honor.

[00:05:05] Speaker 03:
That the issue with the Ninth Circuit's decision is it didn't analyze whether this is a collateral order under federal circuit law, or whether this court would decide that in the first instance.

[00:05:16] Speaker 04:
I'm not intending any criticism of the Ninth Circuit.

[00:05:19] Speaker 04:
I just want to know when I sit down to decide whether I can decide this case, it seems to me the first thing I have to ask is, am I applying Federal Circuit law or am I applying Ninth Circuit law?

[00:05:32] Speaker 04:
I understand Christensen is out there and maybe that's the right answer, but putting that aside just for the moment, we have

[00:05:41] Speaker 04:
a binding precedent in this Dupuis synthist case, which again, you didn't address or distinguish in your briefing.

[00:05:48] Speaker 04:
So I don't know what to do with it.

[00:05:49] Speaker 04:
We seem to very clearly say questions of our jurisdiction are governed by federal circuit law.

[00:05:54] Speaker 04:
That's a case that looks just like this one.

[00:05:57] Speaker 04:
It was transferred from, I think, the 11th Circuit.

[00:06:00] Speaker 04:
It's a dispute over whether the collateral order doctrine applies to a different type of order.

[00:06:05] Speaker 04:
And it seems to be telling me I have to apply federal circuit law.

[00:06:09] Speaker 04:
Whether we have any or not,

[00:06:11] Speaker 04:
next question, but am I right that I have to apply Federal Circuit law to answer these questions?

[00:06:18] Speaker 03:
Yes, setting aside the Christensen and the Federal Circuit precedent applying that saying you're not looking at this afresh, you're deferring to the Ninth Circuit's determination under that this court would have jurisdiction under 1295A.

[00:06:31] Speaker 03:
But assuming that this court is looking at this issue afresh, I do think you would still look to Ninth Circuit precedent to determine whether it's a collateral issue or a collateral

[00:06:40] Speaker 03:
Appeal one or the cloud order looked at all the circuits decisions and if they're split right there They're split, but we're asking whether California each it's each hit each circuit Are you saying that because this is a specific?

[00:06:53] Speaker 02:
California statute that what we would be determining is what the California statute says and that that is

[00:07:01] Speaker 02:
definitely is clear that it's a collateral order that's subject to immediate appeal, whereas other state anti-slap issues may not be so clear.

[00:07:10] Speaker 02:
Yes.

[00:07:11] Speaker 03:
That's exactly OK.

[00:07:12] Speaker 03:
That's exactly what I'm saying.

[00:07:13] Speaker 03:
The states have different anti-slaps, and they vary as to whether they're immediately appealable and the policy reasons.

[00:07:18] Speaker 02:
So even if it's a question that we have to decide, I find this very, this is like the hardest

[00:07:25] Speaker 02:
like federal courts questions, and we're going to get to other stuff too.

[00:07:30] Speaker 02:
But it seems kind of hard to say that that would be a question of our law then if what we're doing is looking at California law, because we're certainly in no position to say what California law is any better than the Ninth Circuit.

[00:07:48] Speaker 03:
Yes, and the Californians.

[00:07:49] Speaker 02:
The answer is we have jurisdiction over

[00:07:55] Speaker 02:
a clutter order if it's final and meets all these conditions.

[00:08:00] Speaker 02:
But whether this particular type of order is a final one is something that the regional circuit should determine.

[00:08:07] Speaker 02:
And here, the regional circuit's already determined that these are final orders.

[00:08:11] Speaker 03:
Yes, and it has for over 15 years.

[00:08:13] Speaker 02:
And so once it's a final order, then clearly we have jurisdiction under our own case law.

[00:08:18] Speaker 03:
Yes, that is our understanding.

[00:08:20] Speaker 03:
And the reason the Ninth Circuit holds that is based on California Supreme Court authority, which holds

[00:08:25] Speaker 03:
You know, at the very end, you have a right not to be dragged through the courts.

[00:08:27] Speaker 02:
You've spent a lot of your time on this.

[00:08:29] Speaker 02:
Do you want to get on to the rest of this case?

[00:08:30] Speaker 02:
Yes.

[00:08:32] Speaker 03:
So, setting that aside, I'd like to talk about the Moritz anti-slap analysis proceeds in two steps.

[00:08:38] Speaker 03:
The first prong, and it's our burden to establish that the causes of action arise from protected activity.

[00:08:44] Speaker 03:
That's a fairly straightforward analysis, thanks to, again, a recent decision from the California Supreme Court.

[00:08:49] Speaker 03:
You need to look at the elements of the claims we're challenging, the alleged acts to establish those elements, and whether those acts are protected under the anti-SLAPP statute.

[00:08:58] Speaker 03:
I'll start with the protected acts, just because I think that's the easiest.

[00:09:00] Speaker 03:
The NYTSERGOT has already determined that, quote, the act of filing an application with the USPTO is a protected act within the meaning of the anti-SLAPP statute in the Mindy's decision.

[00:09:09] Speaker 03:
It's a formal communication with USPTO seeking official action.

[00:09:12] Speaker 03:
So therefore, it qualifies.

[00:09:13] Speaker 03:
They don't really dispute this point.

[00:09:15] Speaker 03:
They have other issues with whether it's protected.

[00:09:18] Speaker 03:
I'll get to that in a second.

[00:09:20] Speaker 03:
Going to the elements of the claims we challenge.

[00:09:22] Speaker 03:
We challenge their interference claims, both intentional and negligent, and their misappropriation claims.

[00:09:27] Speaker 03:
The elements of interference, they have to identify a relationship with the probability of future economic benefit, our knowledge, and then

[00:09:34] Speaker 03:
Crucial here, an intentional or negligent wrongful act that actually disrupted their relationship with their customers.

[00:09:40] Speaker 03:
If you look to the elements of their claims at appendix 50, paragraph 136, 137, it says, quote, the existence of the patents themselves is what disrupts their relationships with their customers.

[00:09:52] Speaker 03:
And the information, quote, disclosed in the patents.

[00:09:54] Speaker 03:
They don't allege any other acts that we tip to

[00:09:58] Speaker 03:
interfere with their relationship.

[00:10:00] Speaker 04:
I appreciate what the complaint says.

[00:10:01] Speaker 04:
Their briefing tells us, as I understand their argument, that they don't really accuse your patent applications in their state law claims.

[00:10:11] Speaker 04:
That's not really what it's about.

[00:10:12] Speaker 04:
That from the minute you took their trade secrets, even if you kept it all internal and never applied for a patent, you're liable nonetheless.

[00:10:22] Speaker 04:
And that you're basically ratcheting up evidence that they might offer

[00:10:28] Speaker 04:
into the sort of gravamen of their claim, and you're looking at it the wrong way.

[00:10:34] Speaker 04:
Could you respond to that?

[00:10:36] Speaker 03:
Yeah.

[00:10:37] Speaker 03:
So the reason the California Supreme Court came up with this element space test was to get rid of a lot of these issues that they raised in their argument with the first prong analysis, which is

[00:10:47] Speaker 03:
Of course, in the past, we're looking to the Gravaman, these kind of metaphysical questions, trying to figure out what this claim's really about.

[00:10:53] Speaker 03:
The California Supreme Court says no.

[00:10:54] Speaker 03:
We look at the elements.

[00:10:56] Speaker 03:
What did they actually allege in the complaint?

[00:10:58] Speaker 03:
They're bound by their pleadings.

[00:11:00] Speaker 03:
That's how this analysis has to proceed.

[00:11:02] Speaker 03:
I understand that they disagree with that, and they want to expand in their brief about what their claims are about.

[00:11:08] Speaker 03:
But in their complaint, they allege it was the patents themselves.

[00:11:12] Speaker 00:
But what about paragraph 92 of the complaint, which appears on Appendix Page 43 that alleges Tower has copied the IQE's trade secrets, incorporated them into Tower's patents and patent application, is using them and intends to continue to use them to further their business interests and to damage IQE's market standing.

[00:11:33] Speaker 00:
Doesn't that go beyond the filing of the patent applications?

[00:11:36] Speaker 03:
that they're saying is using them as the only active use that they identify is the patent applications themselves.

[00:11:42] Speaker 03:
There's no other act alleged in this entire complaint as to how we're using these applications.

[00:11:46] Speaker 00:
Right, but it's notice pleading under the Federal Rules of Civil Procedure, so they don't have to articulate every single way that the patent or the trade secret information might be used.

[00:11:57] Speaker 00:
And so in this paragraph, don't they say something beyond just the patent application?

[00:12:04] Speaker 03:
I would say no, nothing that's not conclusory or plausible.

[00:12:09] Speaker 03:
They have to allege how we're using these claims.

[00:12:12] Speaker 03:
And they said the only way that we're using them is in the patent applications themselves.

[00:12:17] Speaker 03:
So under Bonnie, under Supreme Court's decision, those claims are based on our productivity.

[00:12:23] Speaker 03:
looking at the misappropriation claim, they have to allege that we acquire, disclose, or use through improper means.

[00:12:30] Speaker 03:
And if you look at paragraphs 89 through 90 on appendix 42, they specify the disclosure and use of our trade secrets in the, quote, patents and patent applications themselves is the misappropriation.

[00:12:46] Speaker 03:
They didn't have to allege their claims that way, but they have.

[00:12:48] Speaker 03:
And in so doing, they have now shown that their claims are based on our protected activity.

[00:12:54] Speaker 03:
The district court's analysis was in error because

[00:12:58] Speaker 03:
Again, at appendix 1011, the district court recognized that the claims were based on information disclosed in the patents.

[00:13:06] Speaker 03:
They just said that information was IQE's alleged trade secrets, i.e.

[00:13:12] Speaker 03:
the information disclosed in the patents was unlawful, like the patent application itself was unlawful.

[00:13:18] Speaker 03:
Doe v. Gangland addresses that specifically and says, at the first step of this analysis, the court does not assess whether it was unlawful.

[00:13:25] Speaker 03:
That is for a second.

[00:13:26] Speaker 03:
prong merits on the determine whether they have a probability prevailing on their claims.

[00:13:31] Speaker 02:
So you're into your rebuttal.

[00:13:32] Speaker 02:
Do you want to say the rest of it?

[00:13:34] Speaker 02:
Yes, I would like to.

[00:13:35] Speaker 02:
Yeah.

[00:13:35] Speaker 02:
Thank you.

[00:13:35] Speaker 02:
Let's hear it from the other side.

[00:13:55] Speaker 01:
starting off with the question of whose jurisdiction should you look to?

[00:14:04] Speaker 01:
The case law makes clear that this court does not defer to other courts in determining whether or not this court has jurisdiction over a case.

[00:14:13] Speaker 01:
You have to determine whether or not you have that jurisdiction in the first instance.

[00:14:18] Speaker 01:
And under the standard collateral order doctrine rules laid down by the Supreme Court, it's quite clear that this is not a order that is susceptible to the collateral order doctrine.

[00:14:30] Speaker 01:
Specifically, the decision- This is a matter of state law, right?

[00:14:34] Speaker 02:
Doesn't it seem particularly odd that we would be just determining, as a matter of federal circuit law, whether a collateral order under a state law doctrine is sufficiently final for an appealable to this court, to be appealable to this court?

[00:14:52] Speaker 01:
I think this court has to determine, in every instance, whether it has jurisdiction, regardless of whether it's a state court cause of action through a simple fact that state law actually- Are you aware of any other cases where we've said a question of state law because it's a question of jurisdiction is nonetheless federal circuit law versus the regional circuit law?

[00:15:15] Speaker 01:
Well, I mean, I think the quiz is an example, but I also think what state law question were they deciding there?

[00:15:21] Speaker 01:
They were deciding.

[00:15:22] Speaker 01:
I believe they were decided deciding a issue under

[00:15:26] Speaker 01:
I don't have the exact type of state law action there.

[00:15:30] Speaker 02:
There was a collateral order there.

[00:15:31] Speaker 01:
Yes, there was a collateral order.

[00:15:32] Speaker 01:
And the question is whether or not the collateral order was whether or not there was a final decision.

[00:15:37] Speaker 02:
No, I know.

[00:15:38] Speaker 02:
But what was the subject of that order?

[00:15:40] Speaker 01:
Oh, I'm sorry.

[00:15:41] Speaker 01:
I don't know exactly.

[00:15:42] Speaker 02:
I mean, you've got to know the cases if you're going to come up here and argue them to us.

[00:15:45] Speaker 02:
I mean, it could have been a question of federal law or something else.

[00:15:50] Speaker 02:
In that case, we might have more competence.

[00:15:53] Speaker 01:
Except for the fact that other circuits have considered this question before.

[00:15:56] Speaker 01:
For example, in Ernst, Ernst was considering whether or not California anti-slap actions applied.

[00:16:03] Speaker 01:
And Ernst, the Second Circuit said, no, we're not going to follow the Ninth Circuit.

[00:16:07] Speaker 01:
We are going to follow, we're going to decide on our own whether or not the collateral order doctrine applies.

[00:16:12] Speaker 01:
And then went through the standard collateral order doctrine analysis.

[00:16:16] Speaker 01:
And finding that it disagreed with the Ninth Circuit in Basel and said, no, because the issue of anti-SLAP analysis is coupled to the question of the merits, it is not appropriate for a court to review a denial of an anti-SLAP motion under the immediately appeal bill.

[00:16:35] Speaker 01:
So you think we need to get to that question for ourselves?

[00:16:38] Speaker 01:
Yes, I think you do.

[00:16:39] Speaker 01:
I think this is important.

[00:16:40] Speaker 02:
Well, if we do, why isn't it within the collateral order doctrine?

[00:16:43] Speaker 02:
Because it certainly would escape review if we don't hear an immediate appeal.

[00:16:48] Speaker 01:
Absolutely not, Your Honor, because the question at the end of the day is whether or not the Nora Pennington doctrine applies here.

[00:16:53] Speaker 01:
And this court routinely considers the Nora Pennington doctrine at the end of the case after everything else has happened.

[00:17:00] Speaker 04:
And so- Isn't the anti-SLAB analogous to an immunity, which includes an immunity from having to go forward with these claims?

[00:17:08] Speaker 01:
Absolutely not.

[00:17:09] Speaker 01:
And the California Supreme Court has said it's not a substantive immunity.

[00:17:12] Speaker 01:
It's a procedural bar.

[00:17:13] Speaker 04:
It hasn't said that.

[00:17:14] Speaker 04:
If you're relying on the Navalier case, you're misreading that case.

[00:17:18] Speaker 04:
And the Ninth Circuit has continued to apply the analogy of it being an immunity for 20 years now after that Navalier case, unless you have some other case from the California Supreme Court that I overlook.

[00:17:31] Speaker 01:
Well, I don't have a California Supreme court case.

[00:17:34] Speaker 01:
I do have appellate courts in California that have said that... And the Ninth Circuit continued to say anti-SLAP is just like an immunity.

[00:17:42] Speaker 04:
That's correct.

[00:17:43] Speaker 04:
And that's why it's within the scope of a collateral order.

[00:17:48] Speaker 01:
That's correct.

[00:17:49] Speaker 01:
That's the basis for Batesel and the line of the progeny from Batesel.

[00:17:53] Speaker 01:
So why is that wrong?

[00:17:54] Speaker 01:
Because for one thing, there is no immunity that is any different than a Nora Pennington doctrine immunity here.

[00:18:03] Speaker 01:
Everything here collapses into that fact.

[00:18:05] Speaker 01:
They say, look, we get anti-SLAP should apply here because we have first amendment rights and be able to file a patent application, leaving aside that the cause of action was not based purely on the filing of the patent application.

[00:18:18] Speaker 01:
But the second thing they say is, OK, once we're in the antislapped territory, we get off scot-free because the North Pennington Doctrine allows us to petition the government.

[00:18:28] Speaker 01:
And to be quite clear, the North Pennington Doctrine is something that this court reviews after final judgment.

[00:18:34] Speaker 01:
at the end of the day, to determine whether or not there is a bar on liability.

[00:18:39] Speaker 01:
Now, to be sure, Nora Pennington is, in some sense, an immunity.

[00:18:42] Speaker 01:
If the Nora Pennington doctrine applies, then you don't end up in a place where you're going to be found liable for anything.

[00:18:50] Speaker 01:
But that does not mean that the Nora Pennington doctrine or anything else ought to cut off all of the merits determinations ahead of time.

[00:18:57] Speaker 01:
And therefore, that it ought to be immediately appealable to this court.

[00:19:01] Speaker 01:
At the end of the day, when this case is finally done,

[00:19:04] Speaker 01:
We all agree that it should come back to this court.

[00:19:06] Speaker 01:
This court has subject matter jurisdiction because the case arises out of patent laws.

[00:19:10] Speaker 01:
And they can bring their North Pennington claim then.

[00:19:14] Speaker 04:
The problem is they can't bring it now because the collateral order doctrine says... If we do apply federal circuit law and look at this J-Novo, can we choose to treat the Ninth Circuit years of precedent as persuasive authority?

[00:19:28] Speaker 01:
Absolutely, but you could also find that the Ernst decision in the Second Circuit is persuasive on the same issue.

[00:19:34] Speaker 04:
What about Christiansen?

[00:19:36] Speaker 04:
Doesn't Christiansen from the Supreme Court tell us we really should treat as law of the case the decision of the Ninth Circuit to transfer this case to us?

[00:19:45] Speaker 01:
So three points on Christiansen, Your Honor.

[00:19:47] Speaker 01:
First, Christiansen explicitly says that the court must determine whether or not it has jurisdiction.

[00:19:52] Speaker 01:
It cannot find jurisdiction where it does not.

[00:19:55] Speaker 01:
Second off, though,

[00:19:56] Speaker 00:
But in Christensen, wasn't the issue that the Federal Circuit would never have jurisdiction, that the appeal, regardless of when the appeal is taken, was probably in the Seventh Circuit?

[00:20:08] Speaker 01:
Well, the issue there in Christensen is the worry that there'd be bouncing back and forth between the circuits.

[00:20:13] Speaker 00:
So that, for example, the- No, but ultimately, the Supreme Court decided that because the subject matter was not sufficiently intertwined with the patent issue, it belonged with the Seventh Circuit.

[00:20:26] Speaker 00:
Ultimately, you can see that the appeal will come to the federal circuit.

[00:20:30] Speaker 01:
Yes.

[00:20:31] Speaker 01:
So that's why that Christianson is does not apply for that sort of reason.

[00:20:36] Speaker 01:
Like the rationale behind Christianson is that the Supreme Court didn't want a case being pushed back and forth between the regional circuits or between the circuit and the regional circuit here.

[00:20:45] Speaker 01:
That's not going to happen.

[00:20:46] Speaker 01:
Any decision from the district court, the final decision, will come here.

[00:20:51] Speaker 01:
There's no ping-ponging back to the Ninth Circuit, because this case arises out of sidewalks.

[00:20:57] Speaker 02:
Here's instance deals with the subject matter jurisdiction.

[00:20:59] Speaker 02:
We're at the point where it seems like you both agree we have subject matter jurisdiction.

[00:21:04] Speaker 02:
And what we would be deciding is whether we have appellate jurisdiction.

[00:21:08] Speaker 02:
And if we decide we don't, it's not going to get retransferred

[00:21:11] Speaker 02:
It's just going to get dismissed.

[00:21:13] Speaker 01:
That's absolutely correct.

[00:21:14] Speaker 01:
And they could raise it again after the final judgment when the case is done.

[00:21:18] Speaker 01:
But they just can't bring it down.

[00:21:20] Speaker 02:
Well, they can't raise the anti-SLAPP arguments again, because those will be gone.

[00:21:24] Speaker 02:
I mean, I'm a little confused by your argument that the anti-SLAPP case is kind of overlapping or the same as the North Pennington doctrine, because the whole point of the anti-SLAPP act is to

[00:21:39] Speaker 02:
to get you out of costly litigation when they're essentially frivolous claims.

[00:21:44] Speaker 02:
And if we don't allow immediate appeal of that, then even if they do win after the fact, they've undergone the harm of going through the litigation that the Anti-SLAP Act was designed to prevent.

[00:21:56] Speaker 01:
Yes, that is true, that they do not get out due to the procedural devices of the anti-SLAP statute.

[00:22:05] Speaker 01:
What I'm saying, though, is the question of whether or not they're immune from having, that their First Amendment rights provide an immunity is a Nora Pennington-doctored immunity.

[00:22:14] Speaker 01:
And I'm saying Nora Pennington-doctored immunity from liability, not from suit, but from liability, is an issue that they can ultimately address later on in case.

[00:22:26] Speaker 02:
struggling with why Norm Pennington matters here in determining whether California's anti-slap doctrine is a decision under that is a collateral order subject to immediate appeal.

[00:22:41] Speaker 01:
Well, I mean, there's three reasons.

[00:22:42] Speaker 01:
One is because it is subject to review again.

[00:22:45] Speaker 01:
There is a second anti-slap motion sitting before the district court right now that the court is going to have to address.

[00:22:51] Speaker 02:
Your argument seems to suggest, though, that if the anti-slap motion is denied, that appellate courts can't review it.

[00:23:00] Speaker 02:
i would say that we would probably had a public court setting aside in the jurisdiction of stuff i don't care if it's a sport if it's denied under your view that it's not a final appealable order how would an appellate court review it

[00:23:15] Speaker 01:
I mean, I suppose that in the sense that the case would still go on, i.e., in the same way that if a Rule 12 motion is denied, the case goes on.

[00:23:27] Speaker 01:
And so the point is, true, the case goes on, and then there'll be a final judgment on the merits.

[00:23:32] Speaker 01:
And you say, well, I'm worried that I wasn't able to look and evaluate the Rule 12 motion that was denied.

[00:23:38] Speaker 01:
The point is, there was minimal merit.

[00:23:41] Speaker 01:
It went forward, and that's how the case proceeds.

[00:23:43] Speaker 01:
There's a procedural device that allowed you to screen out bad cases, just like the anti-slap motion.

[00:23:50] Speaker 01:
But just because you have that, just because there is no way to immediately review that, does not mean that the anti-slap motion has no teeth, right?

[00:24:00] Speaker 01:
Because they could have succeeded, for example.

[00:24:03] Speaker 02:
OK.

[00:24:04] Speaker 02:
Do you want to address the merits?

[00:24:06] Speaker 01:
Sure.

[00:24:07] Speaker 01:
On the merits, it wasn't just the complaint that Judge Wang discussed, but the district court itself noted what was the issue.

[00:24:20] Speaker 01:
And it is Appendix 10.

[00:24:24] Speaker 01:
responding to Tower's arguments, plaintiff's injury does not result from the mere filing of a patent application, as defendants argue.

[00:24:32] Speaker 01:
Rather, plaintiff's injury results from the defendant's alleged trade secret theft and alleged misrepresentations to the USPTO, et cetera, et cetera, et cetera.

[00:24:40] Speaker 01:
The point of this is, once they started using the trade secret in any format, and namely, they started drafting the patent application, they're using it.

[00:24:49] Speaker 02:
Why isn't this more properly addressed under step two?

[00:24:52] Speaker 02:
To be fair, Your Honor, I think sometimes the step one and step two analysis do our... If we think the district court got it wrong on dismissing it under step one, and we don't buy your argument that we can decide for ourselves under step two, doesn't it have to go back?

[00:25:10] Speaker 01:
Yes, it would have to go back if that's true.

[00:25:12] Speaker 01:
But to be quite clear, under step two, it's fairly clear that fraud in line to an agency is clearly within any exception.

[00:25:23] Speaker 01:
But that's step two.

[00:25:24] Speaker 01:
That would be under step two.

[00:25:25] Speaker 04:
It's clear that the district court should not have considered that at step one, isn't it?

[00:25:33] Speaker 01:
It is quite clear that just simply saying, I filed a patent application does not immediately answer the question, well, was that in furtherance of a right to speech that is protected?

[00:25:45] Speaker 01:
Lying is not protected.

[00:25:47] Speaker 01:
So therefore, in other words, even if you don't buy the argument that, as the district court said, that the government of the complaint was about the misappropriation rather than the filing of the patent application,

[00:26:00] Speaker 01:
It's still true that simply saying, well, I filed a patent application does not immediately mean that step one was satisfied.

[00:26:07] Speaker 00:
Right.

[00:26:07] Speaker 00:
So let's talk about how step one was satisfied.

[00:26:10] Speaker 00:
Because when I look at counts two and then the interference counts, they all seem to arise from this use of the patent, the trade secret information within the patents and the patent application.

[00:26:22] Speaker 00:
So where in the complaint are there any allegations that there was somehow other misappropriation

[00:26:31] Speaker 01:
So pointing to appendix 43, paragraph 92, Trower has copied IQE's trade secrets.

[00:26:38] Speaker 01:
The minute they copied those trade secrets from the PowerPoint presentations with the trade secrets into a patent application, never filed the patent application, just copied it, used the trade secrets for a purpose other than engaging in the business negotiation.

[00:26:52] Speaker 01:
Once they started doing something on their own with those trade secrets, that was the misappropriation.

[00:26:58] Speaker 01:
The point is that they started using them for a purpose that was not allowable.

[00:27:02] Speaker 01:
Even if they had never petitioned the government at the end of the day, they'd still use the trade secrets by creating a patent application.

[00:27:10] Speaker 01:
Now, to be sure, filing the patent application and putting it out into the world greatly exacerbated the damages and greatly exacerbated the harm to IQE.

[00:27:20] Speaker 01:
But the point is that the misappropriation happened

[00:27:24] Speaker 01:
that they started doing something with the trade secret other than engaging in business negotiations for which the trade secrets had been furnished.

[00:27:31] Speaker 04:
But what you alleged is a misappropriation by using your trade secrets at the patent office.

[00:27:39] Speaker 04:
You didn't have to bring that claim, but isn't that very clearly the claim that you brought?

[00:27:44] Speaker 01:
Well, the claim is, I mean, obviously most of the harm is going to come about due to that fact.

[00:27:50] Speaker 01:
But it is the copying of the trade secrets

[00:27:53] Speaker 01:
the incorporating them into a patent application, the using them, the intending to use them, those are all still claims that were brought in the complaint.

[00:28:02] Speaker 01:
And so if you're looking at the complaint,

[00:28:05] Speaker 01:
That's what the district court found.

[00:28:07] Speaker 04:
Why isn't the best understanding of California law as interpreted by the California courts and the Ninth Circuit that when you do that, when your claim is tied up with a misappropriation that ultimately leads to a communication to the patent office,

[00:28:26] Speaker 04:
you are going to lose at step one and maybe you win at step two.

[00:28:31] Speaker 04:
Otherwise, you're going to lose on this claim.

[00:28:36] Speaker 01:
Well, for one thing, courts that have considered that, I mean, this is a fact pattern that has happened before, including at Eagle Harbor.

[00:28:43] Speaker 01:
So courts that have considered this said, no, the issue here is the misappropriation of the trade secret, the use of the trade secret.

[00:28:51] Speaker 01:
To be sure, the second going on to then filing patent application, that is incidental, or that further aggravates the harm.

[00:29:00] Speaker 01:
But it is not, per se, the initial misappropriation.

[00:29:04] Speaker 02:
Thank you.

[00:29:05] Speaker 01:
Thank you.

[00:29:14] Speaker 02:
Mr. Lloyd, you've got a little under two minutes left.

[00:29:17] Speaker 03:
Thank you, Your Honor.

[00:29:19] Speaker 03:
I just want to address a few things.

[00:29:22] Speaker 03:
As Judge Hughes recognized, the California Supreme Court has recognized this is a right to not be dragged through the courts because you exercise your constitutional rights under varian.

[00:29:30] Speaker 03:
Burdens of litigation are, in large measure, lost if the petitioner is forced to litigate a case to its inclusion before obtaining a definitive judgment through the appellate process.

[00:29:38] Speaker 03:
That's varian.

[00:29:39] Speaker 03:
Later in Barry in 2017, they said the basic purpose underlying the anti-SLAP statute.

[00:29:43] Speaker 02:
Do you know what the subject of the collateral order in Dupuy was?

[00:29:47] Speaker 03:
Dupuy, it was a motion to seal.

[00:29:48] Speaker 03:
A motion to seal a denial of the Southern Perseid Federal

[00:29:53] Speaker 03:
procedural law.

[00:29:53] Speaker 03:
Not a state law.

[00:29:54] Speaker 03:
Correct issue.

[00:30:00] Speaker 03:
That's correct.

[00:30:01] Speaker 03:
You mentioned retransfer.

[00:30:02] Speaker 03:
I do just want to address that briefly.

[00:30:05] Speaker 03:
The Ninth Circuit did say that it would retain jurisdiction should this court's jurisdiction not be triggered under 1295A, because in the Ninth Circuit... Yeah, but I don't think we have any question.

[00:30:14] Speaker 02:
We have jurisdiction under 1295A, and then it turns into whether it's a final appealable order to us.

[00:30:20] Speaker 02:
And you agree that if we think it's not final, then we just dismiss, not re-transfer.

[00:30:26] Speaker 03:
So if it's not final, then 1295A's requirements aren't satisfied.

[00:30:31] Speaker 02:
Yes?

[00:30:32] Speaker 02:
That's subject matter jurisdiction.

[00:30:34] Speaker 02:
I think you're confusing two different things.

[00:30:36] Speaker 02:
Don't waste your time on this.

[00:30:38] Speaker 02:
We're going to have to figure this out.

[00:30:39] Speaker 03:
It's complicated.

[00:30:42] Speaker 03:
I will.

[00:30:43] Speaker 03:
And just because you brought it on.

[00:30:45] Speaker 02:
I mean, it seems to me that the district court collapsed one and two.

[00:30:51] Speaker 02:
And I don't think there's precedent for allowing that to be done.

[00:30:54] Speaker 02:
But it does seem to me that they're going to have a good argument on why they should prevail under two if it goes back.

[00:31:00] Speaker 03:
Sure, and they can raise that on step two.

[00:31:03] Speaker 03:
But that's our point, is that the district court's step one analysis was problematic because it did collapse it under DOE.

[00:31:08] Speaker 03:
It did look into whether the alleged petitioning activity here, the filing patents, wasn't lawful.

[00:31:13] Speaker 03:
And it said, because it's been alleged, therefore you

[00:31:17] Speaker 04:
Go back to jurisdictions real quick.

[00:31:20] Speaker 04:
They say that we reviewed North Pennington issues in a post-trial ordinary type of appeal and that if we have to decide whether this is a collateral order, we should look to that analogy.

[00:31:35] Speaker 04:
and not say that this is going to evade review if we wait till later.

[00:31:40] Speaker 04:
What's your response to that?

[00:31:41] Speaker 03:
I would say that if we had made no opinion or arguments in a normal motion to dismiss, then that might have purchased, but here we made them as part of an anti-slap motion, which again is designed to prevent you from having to defend.

[00:31:53] Speaker 04:
I get how there's case law that supports what you're saying, but if we just think of it from a higher level, isn't it a perfectly good analogy?

[00:32:02] Speaker 04:
what we do on nor pennington and doesn't it imply that your issues are actually capable of a real review in a post trial context i would say certain defenses but the whole again and i'm sorry to keep going back this but the whole point of the

[00:32:19] Speaker 03:
of California enacting the statute was to prevent you from having to go through the entire trial, go up on appeal, and then determine you were correct.

[00:32:29] Speaker 03:
You've already incurred the burdens.

[00:32:30] Speaker 03:
You've lost the benefits of the statute.

[00:32:31] Speaker 03:
The California legislature is determined.

[00:32:35] Speaker 02:
Thank you.

[00:32:36] Speaker 02:
Thank you.