Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 1 of 49
`
`
`
`In the United States Court of Federal Claims
`
`
`
`SCIENCE APPLICATIONS
`INTERNATIONAL CORPORATION,
`
`
`Plaintiff,
`
`
` v.
`
`THE UNITED STATES,
`
`
`
`
`
`
`
`No. 17-cv-825
`
`Filed Under Seal: December
`14, 2023
`
`Publication: January 9, 20241
`
`
`
`Defendant,
`
`and
`
`MICROSOFT CORPORATION,
`
` Intervenor-Defendant,
`
` and
`
`L3 TECHNOLOGIES, INC.,
`
` Third-Party Defendant.
`
`
`
`Gwendolyn Tawresey, Troutman Pepper LLP, Washington, D.C. argued for Plaintiff. With her on
`the briefs were Orion Armon, Cooley LLP, Denver, C.O.; and DeAnna D. Allen and Stephen R.
`Smith of Cooley LLP, Washington, D.C.
`
`Hayley A. Dunn, United States Department of Justice, Civil Division, Washington, D.C. argued
`for Defendant. With her on the briefs were Brian M. Boynton, Principal Deputy Assistant Attorney
`General, Washington, D.C.; and Matthew D. Tanner, Scott Bolden, and Gary L. Hausken of the
`United States Department of Justice, Civil Division, Washington, D.C.
`
`Thomas L. Halkowski of Fish & Richardson P.C., Washington, D.C. for Intervenor-Defendant.
`With him on the briefs were Ahmed J. Davis, W. Freeman, Jr., Daniel Y. Lee, and Laura C.
`
`1 This Memorandum and Order was filed under seal, in accordance with the Protective Order
`entered in this case (ECF No. 34) and was publicly reissued after incorporating all appropriate
`redactions proposed by the parties (ECF No. 418-1). The two versions are substantively identical,
`except for the publication date and this footnote.
`
`
`
`
`1
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 2 of 49
`
`
`
`Whitworth of Fish & Richardson P.C., Washington, D.C.; and John Thornburgh, Fish &
`Richardson P.C., San Diego, C.A.
`
`William C. Bergmann of Baker & Hostetler LLP, Washington, D.C. argued for Third-Party
`Defendant. With him on the briefs were Charles C. Carson and Cassandra Simmons of Baker &
`Hostetler LLP, Washington, D.C.; and Phillip D. Wolfe of Baker & Hostetler LLP, Philadelphia,
`P.A.
`
`
`
`MEMORANDUM AND ORDER
`
`I.
`
`Introduction
`On June 19, 2017, Plaintiff Science Applications International Corporation (SAIC) filed
`
`the present action alleging literal patent infringement pursuant to 28 U.S.C. § 1498(a) against
`
`Defendant the United States (the Government). Complaint (ECF No. 1) (Compl.) ¶¶ 1–3.2 SAIC
`
`contends that the Government has infringed SAIC’s patents “by entering into contracts with
`
`Plaintiff’s competitors for the manufacture and subsequent use of night vision goggle weapon
`
`systems with specialized heads up displays that allegedly use Plaintiff’s patented technology.”
`
`Sci. Applications Int’l Corp. v. United States, 148 Fed. Cl. 268, 269 (2020); see Compl. ¶¶ 2, 37.
`
`This Court has issued several opinions throughout the course of this litigation, familiarity
`
`with which is presumed.3 See, e.g., Sci. Applications Int’l Corp. v. United States, 135 Fed. Cl. 661
`
`(2018); Sci. Applications Int’l Corp., 148 Fed. Cl. at 268; Sci. Applications Int’l Corp. v. United
`
`States, 154 Fed. Cl. 594 (2021); Sci. Applications Int’l Corp. v. United States, 156 Fed. Cl. 486
`
`(2021); Sci. Applications Int’l Corp. v. United States, 161 Fed. Cl. 373 (2022); Sci. Applications
`
`
`2 Citations throughout this Memorandum and Order reference the ECF-assigned page numbers,
`which do not always correspond to the pagination within the document.
`
` Since its inception in June 2017, this action has been reassigned four times to different judges.
`See Sci. Applications Int’l Corp., 148 Fed. Cl. at 270; see also ECF No. 25 (Notice of
`Reassignment, dated April 5, 2018); ECF No. 68 (Notice of Reassignment, dated June 21, 2019);
`ECF No. 85 (Notice of Reassignment, dated July 23, 2019); ECF No. 113 (Notice of Reassignment
`to undersigned judge, dated February 27, 2020).
`
` 3
`
`
`
`2
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 3 of 49
`
`
`
`Int’l Corp. v. United States, 162 Fed. Cl. 213 (2022); Sci. Applications Int’l Corp. v. United States,
`
`163 Fed. Cl. 257 (2022); Sci. Applications Int’l Corp. v. United States, No. 17-825 (Fed. Cl. Sept.
`
`28, 2023) (ECF No. 401) (Combined Summary Judgment Opinion). The following three motions
`
`are pending before this Court and are ripe for adjudication:
`
`• Plaintiff SAIC’s Daubert Motion to Exclude Testimony Regarding Alleged Non-Infringing
`Alternatives (ECF No. 350) (SAIC Daubert)4
`
`• Plaintiff SAIC’s Motion to Strike Untimely Non-Infringing Alternatives and Non-
`Infringement Theories (ECF No. 352) (SAIC MTS)5
`
`• Defendants’ Joint Rule 702 Motion to Partially Exclude the Amended Expert Damages
`Report of David A. Haas (ECF No. 353) (Def. Daubert)6
`
`The Court heard argument on these motions, and the motions are now ripe for adjudication.
`
`
`
`Oral Argument Transcript, dated June 22, 2023 (ECF No. 400) (OA Tr.). A background summary
`
`pertinent to the current motions follows.
`
`
`
`
`
`
`4 See Defendants’ Response in Opposition to SAIC’s Daubert Motion to Exclude Testimony
`Regarding Alleged Non-Infringing Alternatives (ECF No. 366) (SAIC Daubert – Def. Resp.);
`SAIC’s Reply in Support of its Daubert Motion to Exclude Testimony Regarding Alleged Non-
`Infringing Alternatives (ECF No. 383) (SAIC Daubert – SAIC Reply).
`
` 5
`
` See Defendants’ Opposition to SAIC’s Motion to Strike Non-Infringing Alternatives and Non-
`Infringement Theories (ECF No. 367) (SAIC MTS – Def. Resp.); SAIC’s Reply in Support of its
`Motion to Strike Untimely Non-Infringing Alternatives and Non-Infringement Theories (ECF No.
`382) (SAIC MTS – SAIC Reply). In the Court’s Memorandum and Opinion dated September 28,
`2023, the Court denied, in part, Plaintiff SAIC’s Motion to Strike Untimely Non-Infringing
`Alternatives and Non-Infringement Theories (ECF No. 352), solely as it pertains to Microsoft’s
`non-infringement theory. Combined Summary Judgment Opinion at 19. As such, the remainder
`of that motion is addressed by the present Memorandum and Order.
`
` 6
`
` See SAIC’s Opposition to Defendants’ Joint Rule 702 Motion to Partially Exclude the Amended
`Expert Damages Report of David A. Haas (ECF No. 365) (Def. Daubert – SAIC Resp.); Joint
`Reply in Support of Defendants’ Rule 702 Motion to Partially Exclude the Damages Report of
`David A. Haas (ECF No. 384) (Def. Daubert – Def. Reply).
`
`
`
`3
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 4 of 49
`
`
`
`A. Background
`
`
`a.
`
`The Alleged Infringing Parties
`
`The Government has entered into several contractual arrangements with various parties to
`
`develop and manufacture the accused technology. On May 9, 2014, the Government, acting by
`
`and through the Department of the Army (the Army), awarded two contracts for the procurement
`
`of the Enhanced Night Vision Goggle-III (ENVG-III) and the Family of Weapon Sights –
`
`Individual (FWS-I) to BAE Systems, Inc. (BAE) and DRS Networks & Imaging Systems, LLC
`
`(DRS). Compl. ¶¶ 2, 37. Neither BAE nor DRS have joined this suit.
`
`On November 20, 2018, Intervenor-Defendant Microsoft Corporation (Microsoft) entered
`
`into a contract with the Government to develop an
`
`
`
`, which includes implementation of the Rapid Target Acquisition (RTA) feature relevant
`
`to SAIC’s infringement claims. See Microsoft’s Unopposed Motion to Intervene Pursuant to Rule
`
`24 (ECF No. 59) at 1. On April 30, 2019, Microsoft filed an unopposed Motion to Intervene in
`
`this action under Rule 24 of the Rules of the United States Court of Federal Claims (Rules), which
`
`this Court granted on May 6, 2019. See id.; Order Granting Intervention and Amending the
`
`Schedule, dated May 6, 2019 (ECF No. 60) (granting Microsoft’s Motion to Intervene). On
`
`September 28, 2023, this Court granted Microsoft’s Motion for Summary Judgment of Non-
`
`Infringement. Combined Summary Judgment Opinion at 98.
`
`On May 30, 2019, the Army entered into two separate other transaction agreements (OTAs)
`
`with L3 Technologies, Inc. (L3) and Harris Corporation (Harris) to develop a prototype for an
`
`Enhanced Night Vision Goggle-Binocular (ENVG-B) that also requires implementation of the
`
`RTA technology at issue in this action. See Memorandum and Order, dated May 12, 2020 (ECF
`
`No. 120) (May 12, 2020 Memorandum and Order) at 3. Defendant filed a Motion to Notify L3
`
`
`
`4
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 5 of 49
`
`
`
`and Harris as interested third parties pursuant to Rule 14(b) on March 10, 2020, which this Court
`
`granted on May 12, 2020. See Motion to Notify Interested Party L3 Technologies, Inc. and Harris
`
`Corporation Pursuant to RCFC 14(b) (ECF No. 114); May 12, 2020 Memorandum and Order at
`
`9–10 (granting Defendant’s Motion to Notify L3 and Harris). Accordingly, Rule 14(b) notices
`
`were issued to L3 and Harris, care of Elbit Systems of America, LLC (Elbit),7 on May 12, 2020.
`
`See Notice to Third Parties (L3 and Harris) pursuant to Rule 14(b)(1) (ECF No. 122). On July 14,
`
`2020, L3 filed its Answer to SAIC’s Complaint, entering the case as a third-party defendant. L3
`
`Technologies, Inc. Answer (ECF No. 131). In contrast, Elbit filed a Notice with the Court
`
`declining to file any third-party pleadings. See Notice by Elbit Systems of America, LLC, dated
`
`July 29, 2020 (ECF No. 135).
`
`b.
`
`The ’230 Patent
`
`The only patent remaining at issue in this action is U.S. Patent No. 9,229,230 (the ’230
`
`Patent). See Joint Stipulation of Invalidity and Motion for Partial Summary Judgment Regarding
`
`the Asserted Patents (ECF No. 208) at 2. The ’230 Patent includes forty-two total claims, three of
`
`which are independent claims: claims 1, 15, and 29. See generally ’230 Patent. Familiarity with
`
`the ’230 Patent is presumed, as is this Court’s September 28, 2023 Memorandum and Opinion,
`
`which includes a detailed explanation of the patent. Combined Summary Judgment Opinion at 8–
`
`16.
`
`
`
`
`
`
`7 Though the Government awarded Harris one of the May 30, 2019 OTAs, the division of Harris
`responsible for developing the company’s night vision technology was spun-off and purchased by
`Elbit Systems of America, LLC (Elbit), which is the U.S. subsidiary of Elbit Systems, Ltd. See
`May 12, 2020 Memorandum and Order at 3 n.1.
`
`
`
`
`5
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 6 of 49
`
`
`
`c.
`
`Fact & Expert Discovery
`
`The parties have invested considerable time and resources into discovery practice
`
`throughout the course of this action, including previously-filed motions to compel that the Court
`
`has denied. See Order, dated June 1, 2022 (ECF No. 278) at 1. Ultimately, fact discovery ended
`
`on August 9, 2022, and expert discovery ended on December 13, 2022. See Scheduling Order,
`
`dated June 14, 2022 (ECF No. 285) at 2; Order, dated November 16, 2022 (ECF No. 326) at 2.
`
`Four expert reports rest at the heart of the three pending motions. On November 4, 2022,
`
`SAIC served Defendants with a copy of the Amended Expert Damages Report of David A. Haas,
`
`SAIC’s damages expert. See Def. Daubert at 7. The report sought to amend Mr. Haas’ original
`
`Expert Damages Report, dated September 30, 2022. See id. On November 22, 2022, Defendants
`
`served SAIC with rebuttal expert reports from Dr. Hany Farid, Defendants’ source code expert;
`
`Dr. John Villasenor, Defendants’ technical expert; and Ms. Kimberly Schenk, Defendants’
`
`damages expert. See SAIC Daubert at 13.
`
`B. Summary of Rulings
`For the reasons stated in this Memorandum and Order, the Court orders the following
`
`disposition of the parties’ three pending motions. Plaintiff SAIC’s Motion to Strike Untimely
`
`Non-Infringing Alternatives and Non-Infringement Theories (ECF No. 352) is DENIED in part,
`
`as it pertains to the non-infringing alternatives theories.8 Plaintiff SAIC’s Daubert Motion to
`
`Exclude Testimony Regarding Alleged Non-Infringing Alternatives (ECF No. 350) is DENIED.
`
`
`8 See supra note 5 (“In the Court’s Memorandum and Opinion dated September 28, 2023, the
`Court denied, in part, Plaintiff SAIC’s Motion to Strike Untimely Non-Infringing Alternatives and
`Non-Infringement Theories (ECF No. 352), solely as it pertains to Microsoft’s non-infringement
`theory.”).
`
`
`
`
`6
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 7 of 49
`
`
`
`Defendants’ Joint Rule 702 Motion to Partially Exclude the Amended Expert Damages Report of
`
`Davis A. Haas (ECF No. 353) is GRANTED in part and DENIED in part.
`
`II.
`
`Plaintiff’s Motion to Strike
`On March 13, 2023, SAIC filed a Motion to Strike urging the Court to strike Defendants’
`
`non-infringing alternatives theories as untimely and inadequately disclosed.9 See generally SAIC
`
`MTS. Accordingly, SAIC moves to strike the following items from the record:
`
`• Paragraphs 7, 11–19, 23, 24, 26–30, 65–70, and 128–30 from Appendix D to Dr. John
`Villasenor’s Expert Report (ECF No. 350-1) (Villasenor Report Appendix D or Villasenor
`Rpt. App. D);
`
`• Paragraphs 91–93 from Appendix C to Dr. John Villasenor’s Expert Report (ECF No. 350-
`6) (Villasenor Report Appendix C or Villasenor Rpt. App. C);
`
`• Paragraphs 98, 175, 177–82, 188, 198, 281, 286, 297, and 395–99 and associated
`calculations in Schedule 7.0 of Ms. Kimberly Schenk’s expert report (ECF No. 350-2)
`(Schenk Report or Schenk Rpt.);
`
`• Paragraphs 18–25 of Dr. Hany Farid’s Rebuttal Expert Report on Infringement (ECF No.
`350-9) (Farid Report or Farid Rpt.); and
`
`• Paragraphs 2.a–2.e of the Declaration of Microsoft Witness
`(ECF No. 352-15)
`.
`
`
`
`
`See SAIC MTS at 9, 22, 34.
`
`
`
`This Court previously denied in part SAIC’s Motion to Strike, solely as it pertains to
`
`Microsoft’s non-infringement theory. See supra note 5; Combined Summary Judgment Opinion
`
`at 19. The Court now addresses the remaining sections of SAIC’s Motion to Strike regarding the
`
`timeliness of Defendants’ non-infringing alternatives theories. See Combined Summary Judgment
`
`Opinion at 17 n.14.
`
`
`9 SAIC’s Motion to Strike also contested the timeliness of Microsoft’s non-infringement theories.
`SAIC MTS at 23–33. This Court’s September 28, 2023 Memorandum and Order denied the
`Motion as it pertains to Microsoft’s non-infringement theory. See Combined Summary Judgment
`Opinion at 19.
`
`
`
`7
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 8 of 49
`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 8 of 49
`
`Having considered the parties’ arguments, applicable law, and the record, this Court
`
`DENIESSAIC’s Motion to Strike Untimely Non-Infringing Alternatives and Non-Infringement
`
`Theories (ECF No. 352), as it pertains to the other modes non-infringing alternatives theory. This
`
`Court DENIESas moot SAIC’s Motion to Strike Untimely Non-Infringing Alternatives and Non-
`
`Infringement Theories (ECF No.352),as it pertains to the non-infringing alternative
`
`theory.
`
`A. Background
`
`SAIC’s Motion to Strike identifies two non-infringing alternatives theories introduced by
`
`Defendants. First, Defendants contend that the accused devices possess other RTA modes, other
`
`than the allegedly infringing RTA mode,that serve as non-infringing alternatives. VillasenorRpt.
`
`Aon. C592,es
`
`Report of Dr. Chandrajit Bajaj, Ph.D. on Infringement of U.S. Patent No. 9,229,230 — Appendix
`
`A § 22 (ECF No.343-24) (citing GOV-0329407 at12)
`
`816 ces
`
`Microsoft’s and L3’s!° accused devices implement this RTA mode in such a waythat infringes
`
`uponthe ’230 Patent. See SAIC MTSat8 (“SAICalleges that the ENVG-B, ENVG-II, andij
`
`10 13’s equivalent of the RTA bubble modeis its “spatially aligned mode.” See Opening Expert
`Report of Dr. Chandrajit Bajaj, Ph.D. on Infringement of U.S. Patent No. 9,229,230 (ECF No.
`340-3)
`(Bajaj Opening Report or Bajaj Op. Rpt.
`
`110
`
`see also SAIC MTSat 8 (naming“spatially aligned mode”as L3’s allegedly infringing
`
`mode).
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 9 of 49
`
`
`
`night vision goggles and weapon systems infringe the ’230 Patent through use of ‘spatially aligned’
`
`or ‘bubble’ mode in the Rapid Target Acquisition (‘RTA’) functionality.”).
`
`
`
`Defendants contend, however, that the accused devices offer two alternative, non-
`
`infringing RTA modes. L3’s ENVG-B system and Microsoft’s
`
` devices offer three different
`
`RTA modes—the Picture-in-Picture (PiP) mode, full weapon sight (FWS) mode, and accused
`
`spatially aligned or bubble mode. See Villasenor Rpt. App. C ¶¶ 92, 92 n.40. SAIC has not
`
`accused either the PiP mode or FWS mode of infringing the ’230 Patent. See SAIC MTS at 6
`
`(“SAIC alleges that one mode of Rapid Target Acquisition (‘RTA’) infringes the asserted claims.
`
`There are two other RTA modes that are not accused.”). As such, Defendants argue that
`
`
`
`
`
` Villasenor Rpt. App. C ¶ 92.
`
`
`
`The second non-infringing alternative theory posited by Defendants is that Microsoft’s
`
` devices can operate in bubble mode without infringing the ’230 Patent by
`
`. See Schenk Rpt. ¶ 281
`
`
`
`
`
`
`
`;
`
`Microsoft Corporation’s First Supplemental Response to SAIC’s Fourth Set of Interrogatories (No.
`
`19) (ECF No. 350-4) (Microsoft’s Resp. to Interrog. No. 19) at 5
`
`
`
`
`
`
`
`
`
`. SAIC’s
`
`9
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 10 of 49
`
`
`
`Motion to Strike contests the timeliness and adequacy of Defendants’ disclosure of the two
`
`aforementioned non-infringing alternatives theories.
`
`B. Applicable Legal Standards
`Rule 33 governs interrogatories between parties. See Rule 33(b)(3) (“Each interrogatory
`
`must, to the extent it is not objected to, be answered separately and fully in writing under oath.”).
`
`During fact discovery, parties may issue contention interrogatories to “discover the factual basis
`
`of the allegations in a complaint, answer, or counterclaim, or to determine the theory of the
`
`opposing party’s case.” Contention Interrogatory, BLACK’S LAW DICTIONARY (11th ed. 2019).
`
`Rule 26(a)(2) governs disclosures related to parties’ expert witnesses. Specifically, an
`
`expert’s report must contain “a complete statement of all opinions the [expert] witness will express
`
`and the basis and reasons for them.” Rule 26(a)(2)(B)(i). “A party must make these disclosures
`
`at the times and in the sequence that the court orders.” Rule 26(a)(2)(D).
`
`Rule 26(e)(1) imposes a duty on parties to supplement their interrogatory responses and
`
`expert reports in certain circumstances:
`
`A party who has made a disclosure under [Rule] 26(a)—or who has responded to
`an interrogatory, request for production, or request for admission—must
`supplement or correct its disclosure or response . . . in a timely manner if the party
`learns that in some material respect the disclosure or response is incomplete or
`incorrect, and if the additional or corrective information has not otherwise been
`made known to the other parties during the discovery process or in writing; or . . .
`as ordered by the court.
`
`Rule 26(e)(1)(A)–(B). Additionally, “[f]or an expert whose report must be disclosed under [Rule]
`
`26(a)(2)(B), the party’s duty to supplement extends both to information included in the report and
`
`to information given during the expert’s deposition.” Rule 26(e)(2).
`
`Failure to comply with these disclosure requirements can result in sanctions. Under Rule
`
`37(c)(1), “[i]f a party fails to provide information or identify a witness as required by [Rule] 26(a)
`
`or (e), the party is not allowed to use that information or witness to supply evidence on a motion,
`
`
`
`10
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 11 of 49
`
`
`
`at a hearing, or at a trial, unless the failure was substantially justified or is harmless.” Rule
`
`37(c)(1). The decision to impose sanctions and the extent of any such sanctions are at the trial
`
`court’s discretion. See Rule 37(c)(1)(A)–(C) (“In addition to or instead of [the exclusion] sanction,
`
`the court, on motion and after giving an opportunity to be heard . . . may order payment of the
`
`reasonable expenses, including attorney’s fees, caused by the failure . . . [and] may impose other
`
`appropriate sanctions . . . .”) (emphasis added); see, e.g., Precision Pine & Timber, Inc. v. United
`
`States, No. 98-720 C, 2001 WL 1819224, at *3 (Fed. Cl. Mar. 6, 2001) (citing Adkins v. United
`
`States, 816 F.2d 1580, 1581–82 (Fed. Cir. 1987)) (“The decision on whether to impose discovery
`
`sanctions, either pursuant to its inherent authority or under existing Rules of the Court of Federal
`
`Claims rests within the sound discretion of the Court.”); Bowman Constr. Co. v. United States, No.
`
`18-1822C, 2020 WL 1970546, at *3 (Fed. Cl. Apr. 23, 2020) (quoting Ingalls Shipbuilding, Inc.
`
`v. United States, 857 F.2d 1448, 1450 (Fed. Cir. 1988)) (“The decision whether to impose
`
`discovery sanctions rests within the sound discretion of the trial court.”).
`
`A party that fails to meet its discovery obligations may avoid sanctions if it demonstrates
`
`that its failure was either “substantially justified or is harmless.” Rule 37(c)(1); see, e.g., Zoltek
`
`Corp. v. United States, 71 Fed. Cl. 160, 167 (2006) (“Circuit courts applying the federal rule have
`
`held that the sanction of exclusion is automatic and mandatory unless the party violating [Rule] 26
`
`shows that the violation was justified or harmless.”); Scott Timber, Inc. v. United States, 93 Fed.
`
`Cl. 221, 226 (2010) (noting “the burden is on the offending party to show that its violation was
`
`either justified or harmless” and citing as support cases from the First, Fifth, and Seventh Circuits).
`
`This Court has wide discretion to determine whether a non-disclosing party’s conduct was
`
`“substantially justified or harmless.” See, e.g., Hanover Ins. Co. v. United States, 137 Fed. Cl.
`
`479, 483 (2018) (citing Cohen v. United States, 100 Fed. Cl. 461, 468 (2011)).
`
`
`
`11
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 12 of 49
`
`
`
`When determining whether a disclosure failure warrants sanctions or, rather, was
`
`“substantially justified or harmless,” this Court may consider a variety of factors: (1) prejudice or
`
`surprise to the opposing party; (2) ability to cure that prejudice or surprise; (3) the importance of
`
`the challenged evidence; (4) the extent to which admitting the evidence would disrupt trial; (5) the
`
`non-disclosing party’s explanation for their conduct; and (6) whether the party acted in bad faith
`
`or willfully.11 See, e.g., SAIC, 163 Fed. Cl. at 272–73; see also MicroStrategy Inc. v. Bus. Objects,
`
`S.A., 429 F.3d 1344, 1357 (Fed. Cir. 2005) (quoting S. States Rack & Fixture, Inc. v. Sherwin-
`
`Williams Co., 318 F.3d 592, 596 (4th Cir. 2003)) (referencing a five-factor test that included
`
`surprise, ability to cure surprise, disruption of trial, the importance of the testimony, and the party’s
`
`
`11 Though some courts have required a showing of willfulness or bad faith prior to imposing
`sanctions, such a requirement is not universally applied. See, e.g., SAIC v. United States, 162 Fed.
`Cl. 257, 272 n.19 (2022) (discussing decisions by various circuits and whether those courts
`required a showing of willfulness). Typically, courts will not sanction by dismissing a case, or
`imposing a sanction tantamount to dismissal, absent a showing of willfulness or bad faith. See,
`e.g., Intelligent Invs., Inc. v. United States, No. 2021-2310, 2022 WL 17075056, at *1 (Fed. Cir.
`Nov. 18, 2022) (“[W]e conclude that the Claims Court abused its discretion by dismissing the case
`without finding that the noncompliance was willful or in bad faith . . . .”); Securiforce Int’l Am.
`LLC v. United States, 127 Fed. Cl. 386, 396 (2016) (quoting Ingalls Shipbuilding, Inc., 857 F.2d
`at 1451) (noting sanctions such as “de facto dismissal” necessitate a showing of bad faith or
`willfulness, although Rule 37 does not explicitly state such a requirement). However, courts have
`not demonstrated a clear consensus whether demonstration of bad faith or willfulness is necessary
`prior to imposing lesser sanctions. Compare Toyrrific, LLC v. Karapetian, 606 F. App’x. 365 (9th
`Cir. 2015) (declining to affirm evidentiary exclusion for a Rule 26 violation that had no evidence
`of bad faith) with Zoltek, 71 Fed. Cl. at 168 (refusing to require showing of bad faith and “instead
`choosing to subsume it into the justification requirement in analyzing the explanation for the
`party’s failure to disclose”). Instead, courts consider whether the sanction is proportionate to the
`offending party’s discovery conduct. See, e.g., Adasa Inc. v. Avery Dennison Corp., 55 F.4th 900,
`917 (Fed. Cir. 2022) (“And, while district courts may impose [discovery] sanctions for deterrent
`effects, the size of the award must bear a reasonable relationship to the harm that occurred.”);
`Salgado v. Gen. Motors Corp., 150 F.3d 735, 740 (7th Cir. 1998) (quoting Melendez v. Illinois
`Bell Tel. Co., 79 F.3d 661, 672 (7th Cir. 1996)) (refusing to grant dismissal sanctions that were not
`“proportionate to the circumstances surrounding [the] party’s failure to comply with discovery
`rules”); Canvs Corp. v. United States, 104 Fed. Cl. 727, 733 (2012) (acknowledging that the
`discovery sanction imposed was a “fair and appropriate sanction proportional to the misconduct in
`question”).
`
`
`
`12
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 13 of 49
`
`
`
`explanation for its failure to disclose); David v. Caterpillar, Inc., 324 F.3d 851, 857 (7th Cir. 2003)
`
`(identifying a four-factor test considering prejudice or surprise to the party, the ability to cure
`
`surprise, the likelihood of disruption to trial, and the bad faith or willfulness of the non-disclosing
`
`party); Hitkansut LLC v. United States, 127 Fed. Cl. 101, 107 (2016) (“[T]he court may consider
`
`surprise to the other party, whether there is opportunity to cure that surprise, the proponent’s need
`
`for the evidence at trial, or other factors.”); Banks v. United States, 75 Fed. Cl. 294, 298–99 (2007)
`
`(summarizing the various tests that courts have applied and adopting the approach applied by the
`
`Third, Seventh, and Tenth Circuits).
`
`C. Discussion
`SAIC contends that Defendants’ allegedly belated disclosure of their two non-infringing
`
`alternatives theories prejudiced SAIC. Specifically, SAIC alleges that it only learned of
`
`Defendants’ other modes theory via Defendants’ rebuttal expert reports, and that Microsoft waited
`
`until the last day of discovery and after the completion of all depositions to contend that
`
`
`
`. SAIC MTS at 6. As
`
`SAIC argues that the delay was not justified and the resulting prejudice is incurable, SAIC urges
`
`the Court to strike Defendants’ theories and preclude Defendants from presenting such theories at
`
`trial. Id.
`
`a. Other Modes Theory
`SAIC argues that “Defendants sprang the new [other modes] theory” for the first time in
`
`rebuttal expert reports, thereby depriving it of the opportunity to depose Defendants’ fact
`
`witnesses, request additional discovery, or address the theory in its own expert reports. Id. at 22.
`
`However, SAIC’s arguments fail to account for the fact that SAIC was aware of the other modes
`
`as non-infringing alternatives as early as May 2, 2022. See L3’s Response to SAIC’s Second Set
`
`
`
`13
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 14 of 49
`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 14 of 49
`
`of Interrogatories (Nos. 11-18) (ECF No. 367-2) (L3 Resp. to SAIC SecondSet of Interrog.) at
`
`10-11, 18. On March 31, 2022, SAIC served L3 with Interrogatory No.14, stating:
`
`To the extent You contend that non-infringing alternatives concerning the RTA
`Spatial Alignmentfunctionality of the Accused Instrumentalities exist, identify and
`describe each noninfringing alternative and the basis for your contention that it is
`or was non-infringing, acceptable, and available to You, as well as when it became
`available to You and the itemized cost of implementing each such non-infringing
`alternative, including without limitation continuing operational costs, direct and
`indirect implementation costs, and opportunity costs.
`
`L3 Resp. to SAIC Second Setof Interrog. at 10; SAIC MTS — Def. Resp. at 9. L3 responded on
`
`May2, 2022,stating:
`
`
`
`L3 Resp. to SAIC Second Set of Interrog. at 11 (emphasis added). Thus, SAIC was aware of
`
`Defendants’ intent to further a non-infringing alternative theory based on the other RTA modes
`
`three months prior to the end of fact discovery and six months prior to receiving Defendants’
`
`rebuttal expert reports. See Scheduling Order, dated June 14, 2022 (ECF No.285); see also SAIC
`
`Daubert at 13.
`
`In response, SAIC attempts to argue that L3’s interrogatory response is insufficient to
`
`constitute adequate notice of Defendants’ other modes theory. SAIC MTS — SAIC Replyat 10.
`
`Specifically, SAIC takes issue with portions of the interrogatory that it claims remain unanswered
`
`by L3’s response—requests for the basis of L3’s contention that its alternative is non-infringing,
`
`acceptable, and available; when the alternative became available; and the itemized cost of
`
`implementing the alternative.
`
`Jd. Yet, prior to its Motion to Strike, SAIC never sought
`
`14
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 15 of 49
`
`
`
`clarification from L3 on its response, requested further written discovery on the topic, or raised
`
`any concerns with the adequacy of L3’s response.12 See SAIC MTS – Def. Resp. at 10.
`
`Further, SAIC’s citation in support of its position is inapposite. SAIC MTS – SAIC Reply
`
`at 10 (citing ICM Controls Corp. v. Honeywell Int’l Inc., No. 15:12-CV-1766, 2021 WL 3403734,
`
`at *3 (N.D.N.Y. Aug. 4, 2021)). While the Court in ICM Controls Corp. did, in fact, exclude
`
`evidence of non-infringing alternatives on account of the lack of notice to the patentee due to
`
`“vague and general language” in the interrogatory response, the record in front of this Court is
`
`distinguishable from that in ICM Controls Corp. See 2021 WL 3403734, at *3. As explained in
`
`ICM Controls Corp., “when the alternatives at issue are hypothetical and never existed on the
`
`market . . . the burden shifts to the alleged infringer to demonstrate that the non-infringing
`
`alternative would have been available” and the accused infringer should “alert[] [the patentee] of
`
`its proposed non-infringing alternatives.” Id. In contrast, the other RTA modes named as non-
`
`infringing alternatives in L3’s response are not merely hypothetical but are already built into the
`
`accused products. See Villasenor Rpt. App. C ¶¶ 92, 92 n.40. Additionally, unlike the defendant
`
`in ICM Controls Corp., which merely posited potential unnamed, unspecified alternatives in its
`
`interrogatory response, L3 specifically identified the other RTA modes as non-infringing
`
`alternatives. Compare ICM Controls Corp., 2021 WL 3403734, at *2 (noting Defendant’s
`
`
`12 It is the responding party, i.e., Defendants, who have “an affirmative duty to amend a prior
`response if it is materially incomplete or incorrect.” Zoltek, 71 Fed. Cl. at 164. In evaluating
`whether Defendants had an affirmative duty, the Court considers the following four factors: “(1)
`whether there was a prior response; (2) whether the response became materially incorrect or
`incomplete; (3) whether the [party] knew that the response was incomplete; and (4) whether the
`corrective information was otherwise made known to [the movant] through the discovery process
`or in writing.” Id. Whether the opposing party requested further clarification—for example,
`through a motion to compel—is relevant to this inquiry. See id. at 166 (explaining how Defendant
`was “on notice” that its interrogatory response was incomplete due to multiple requests from
`Plaintiff for additional information).
`
`
`
`15
`
`

`

`Case 1:17-cv-00825-EMR Document 419 Filed 01/09/24 Page 16 of 49
`
`
`
`interrogatory response merely stated, “Discovery revealed the existence of several non-patented
`
`competing designs that were in public use during the relevant period when [the accused infringer]
`
`could have redesigned the accused products”) with L3 Resp. to SAIC Second Set of Interrog. at 11
`
`
`
`.
`
`Even if this Court were to construe L3’s interrogatory response as somehow inadequate,
`
`the record in front of this Court indicates that any such failure would be “substantially justified or
`
`[] harmless.” Rule 37(c)(1); see Zoltek, 71 Fed. Cl. at 1