throbber
Case 1:17-cv-00770-JDW Document 259-5 Filed 11/02/23 Page 1 of 13 PageID #: 29236
`Case 1:17-cv-00770-JDW Document 259-5 Filed 11/02/23 Page 1 of 13 PagelD #: 29236
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`
`
`EXHIBIT 31
`EXHIBIT 31
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`
`

`

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`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`PACKET INTELLIGENCE LLC,
`
`Plaintiff,
`
`
`
`
`
`
`
`v.
`
`NETSCOUT SYSTEMS, INC.,
`TEKTRONIX COMMUNICATIONS, and
`TEKTRONIX TEXAS, LLC
`
`Civil Action No. 2:16-CV-00230
`
`
`
`Defendants.
`
`PACKET INTELLIGENCE’S OPPOSITION TO NETSCOUT’S RENEWED
`MOTION FOR JUDGMENT AS A MATTER OF LAW OF NO WILLFUL
`INFRINGEMENT PURSUANT TO FED. R. CIV. P. 50(b)
`
`
`
`
`
`
`
`
`
`
`
`

`

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`
`TABLE OF CONTENTS
`
`
`
`I. 
`
`II. 
`
`INTRODUCTION ...............................................................................................................1 
`
`LEGAL STANDARDS ........................................................................................................1 
`
`III. 
`
`ARGUMENT .......................................................................................................................2 
`
`A. 
`
`B. 
`
`C. 
`
`Absence of Formal Pre-Suit Infringement Notice Does Not Foreclose
`Willfulness ...............................................................................................................2 
`
`The Trial Evidence More Than Sufficiently Supports the Verdict ...........................3 
`
`NetScout Continues to Market and Promote Sales of the Infringing
`Products....................................................................................................................5 
`
`D. 
`
`NetScout’s Defenses Do Not Foreclose Willfulness ................................................7 
`
`IV. 
`
`CONCLUSION ....................................................................................................................8 
`
`
`
`
`
`
`
`
`
`
`
`
`
`ii
`
`

`

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`
`CASES 
`
`TABLE OF AUTHORITIES
`
`Baisden v. I’m Ready Prods., Inc.,
`693 F.3d 491 (5th Cir. 2012) ....................................................................................................... 2
`
`Barry v. Medtronic, Inc.,
`230 F. Supp. 3d 630 (E.D. Tex. 2017) ........................................................................................ 8
`
`Bianco v. Globus Med., Inc.,
`No. 2:12-CV-00147-WCB, 2014 U.S. Dist. LEXIS 151967 (E.D. Tex. Oct. 27, 2014) ............ 6
`
`Erfindergemeinschaft UroPep GbR v. Eli Lilly & Co.,
` 276 F. Supp. 3d 629 (E.D. Tex. 2017) ....................................................................................... 1
`
`Ericsson Inc. v. TCL Commun. Tech. Holdings, Ltd.,
`No. 2:15-cv-00011-RSP, 2017 U.S. Dist. LEXIS 183216 (E.D. Tex. Nov. 4, 2017).................. 3
`
`Ericsson Inc. v. TCL Commun. Tech. Holdings, Ltd.,
`No. 2:15-cv-00011-RSP, 2018 U.S. Dist. LEXIS 78857 (E.D. Tex. May 10, 2018) .............. 4, 5
`
`Flowers v. S. Reg’l Physician Servs. Inc.,
`247 F.3d 229 (5th Cir. 2001) ....................................................................................................... 6
`
`Huawei Techs. Co. v. T-Mobile US, Inc.,
`No. 2:16-cv-52-JRG-RSP, 2017 WL 1129951 (E.D. Tex. Feb. 21, 2017) .................................. 3
`
`Metaswitch Networks Ltd. v. Genband US LLC,
`No. 2:14-CV-00744-JRG, U.S. Dist. LEXIS 137926 (E.D. Tex. Aug. 28, 2017) ...................... 2
`
`Olibas v. Barclay,
`838 F.3d 442 (5th Cir. 2016) ....................................................................................................... 2
`
`Radware, Ltd. v. F5 Networks, Inc.,
`2016 U.S. Dist. LEXIS 112504 (Aug. 22, 2016 N.D. Cal.) ........................................................ 2
`
`Weeks v. Angelone,
`528 U.S. 225 (2000) .................................................................................................................... 5
`
`WesternGeco LLC v. ION GeoPhysical Corp.,
`837 F.3d 1358 (Fed. Cir. 2016) ............................................................................................... 7, 8
`
`RULES 
`
`Fed. R. Civ. P. 50(a)(2) ................................................................................................................... 7
`
`
`
`iii
`
`

`

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`I.
`
`INTRODUCTION
`
`After rendering credibility determinations on fourteen witnesses presented at trial,1 a jury
`
`was properly instructed on the standard for willful infringement and found unanimously that
`
`NetScout willfully infringed PI’s Asserted Patents. Dkt. 237 at 3. Following extensive post-trial
`
`briefing for entry of judgment on willfulness and for enhanced damages, the Court held “that the
`
`jury’s willfulness finding was more than adequately supported by the evidence adduced at
`
`trial[.]” Dkt. 305 at 3. Further, after considering the Read factors the Court independently
`
`determined that “egregious infringement behavior [by NetScout] was present and enhancement is
`
`appropriate on that basis.” Id. at 15.
`
`Despite the jury’s verdict of willfulness and the Court’s findings enhancing damages
`
`upon finding the verdict “more than” adequately supported, NetScout asserts: “There is no
`
`evidence in the record that shows infringement that was [willful].” Mot. at 4. But NetScout’s
`
`reliance on certain Read factors the Court found in NetScout’s favor—while ignoring Read
`
`findings and evidence adverse to NetScout—is nakedly self-serving. The result is a NetScout
`
`Motion that ignores or mistates important facts supporting willfulness, directs the Court to non-
`
`binding or irrelevant authority, and ignores the substantial trial testimony and credibility
`
`determinations underlining the jury’s willfulness verdict. The Court should deny the Motion.
`
`II.
`
`LEGAL STANDARDS
`
`“A motion for judgment as a matter of law [under Rule 50(b)] is a challenge to the legal
`
`sufficiency of the evidence supporting the jury’s verdict.” Erfindergemeinschaft UroPep GbR v.
`
`Eli Lilly & Co., 276 F. Supp. 3d 629, 643 (E.D. Tex. 2017) (“UroPep”) (Bryson, J., sitting by
`
`
`1 According to the Court’s trial minutes, 14 witnesses testified in person or by deposition
`to the jury (Dkt. 239-241)—not including witnesses who testified during the bench trial on
`equitable matters.
`
`1
`
`

`

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`designation). The Fifth Circuit is “especially deferential” to a jury verdict. Olibas v. Barclay,
`
`838 F.3d 442, 448 (5th Cir. 2016). The Court must draw all reasonable inferences in the light
`
`most favorable to the verdict. See, e.g. Metaswitch Networks Ltd. v. Genband US LLC, No. 2:14-
`
`CV-00744-JRG, U.S. Dist. LEXIS 137926 at *7 (E.D. Tex. Aug. 28, 2017). “A district court must
`
`deny a motion for judgment as a matter of law unless the facts and inferences point so strongly
`
`and overwhelmingly in the movant’s favor that reasonable jurors could not reach a contrary
`
`conclusion Baisden v. I’m Ready Prods., Inc., 693 F.3d 491, 498 (5th Cir. 2012) (emphasis
`
`added) (internal quotation marks omitted).
`
`III. ARGUMENT
`
`A. Absence of Formal Pre-Suit Infringement Notice Does Not Foreclose Willfulness
`
`NetScout does not deny that defendant Tektronix knew of at least the asserted ’725 patent
`
`prior to the filing of this lawsuit. Mot. at 2. Indeed, NetScout emphasizes that the way it learned
`
`of the ’725 patent is a U.S. patent examiner cited PI’s patent as pertinent prior art to a purported
`
`invention Tektronix was seeking to patent—putting Tektronix on notice that an independent
`
`government patent official considered a presumptively valid and unexpired patent to be pertinent
`
`to the technology Tektronix was developing and seeking to patent. NetScout relies on Radware,
`
`Ltd. v. F5 Networks, Inc., 2016 U.S. Dist. LEXIS 112504 at *12-13 (Aug. 22, 2016 N.D. Cal.),
`
`which states “mere” citation to asserted patents during prosecution is not sufficient for
`
`willfulness. Id. But this authority focused on pre-suit knowledge as the sole basis for willfulness,
`
`which is not pertinent to the facts of this case. Here, upon receiving detailed notice of
`
`infringement in March 2016, NetScout not only continued to sell the infringing products, it did
`
`so while asserting that the inventors did not invent the claimed inventions—NetScout and/or the
`
`RMON Working Group did—and the inventors stole the inventions and have been lying about it
`
`for nearly 20 years.
`
`2
`
`

`

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`
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`NetScout cites to non-binding caselaw outside this district to assert it is an “open
`
`question” whether willful infringement can be supported based solely on post-suit conduct. Mot.
`
`at 3. But NetScout’s argument ignores an important fact: it is not an “open question” whether
`
`post-suit conduct alone can support willfulness in this case. The agreed willfulness instruction
`
`issued to the jury did not foreclose a willfulness finding based solely on post-suit conduct—to
`
`the contrary, the instruction explicitly provided “[i]n determining whether the infringement by
`
`NetScout was willful, you may consider all the relevant facts.” Dkt. 252, 32:4-14. NetScout did
`
`not object to this instruction—it agreed to it. Dkt. 251, Charge Conf. Tr., 10/12/17 at 5:6-10:4.
`
`Nor does NetScout’s present Rule 50(b) motion object to the jury instruction. Mot., passim. As a
`
`result, NetScout has waived any argument that the jury was improperly instructed on
`
`willfulness—and the agreed jury instruction closes any purported open question on this issue.
`
`Further, it is not an “open question” in this District—as the Court has already held in this case.
`
`See Dkt. 305 at 3 (“willfulness based on egregious conduct post-filing conduct is permitted”)
`
`(citing Ericsson Inc. v. TCL Commun. Tech. Holdings, Ltd., No. 2:15-cv-00011-RSP, 2017 U.S.
`
`Dist. LEXIS 183216, t *18-19 (E.D. Tex. Nov. 4, 2017); Huawei Techs. Co. v. T-Mobile US, Inc.,
`
`No. 2:16-cv-52-JRG-RSP, 2017 WL 1129951, at *4 (E.D. Tex. Feb. 21, 2017)).
`
`B. The Trial Evidence More Than Sufficiently Supports the Verdict
`
`The evidence presented at trial was more than sufficient to support the willfulness
`
`verdict. The trial evidence established that NetScout’s corporate representative, Mr. Kenedi, had
`
`never read the patents but took the stand to sponsor NetScout’s theory that Mr. Dietz lied and
`
`stole the claimed inventions, and that NetScout’s CEO, Mr. Singhal, could not recall ever
`
`carefully reviewing the Asserted Patents, and is certain he did not read the entirety of even a
`
`single Asserted Patent. See Dkt. No. 300, 10/11/17 AM Trial Tr. at 109:14-110:22; 116:18-19;
`
`Dkt. 248, 10/11/17 PM Trial Tr. at 87-11-88:4. NetScout relies on the same trial cites (Mot. at
`
`3
`
`

`

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`3)—but none of those citations mitigate the egregious nature of NetScout’s infringement and its
`
`strategy to attack the inventors and accuse them of stealing the subject-matter of the Asserted
`
`Patents without having read the Asserted Patents in any detail. More importantly, nothing in the
`
`transcripts cited above supports NetScout’s assertion that it “promptly investigated and, relying
`
`on technical experts and its counsel, formed noninfringement and invalidity defenses in good
`
`faith.” Mot. at 3.
`
`NetScout did not assert an advice of counsel defense to willfulness. Thus, neither
`
`counsel’s advice nor the steps taken to provide it were disclosed or subject to cross-examination.
`
`NetScout cannot simply hide behind its attorneys or experts to insulate itself from the jury’s
`
`willfulness finding—particularly in the absence of trial testimony demonstrating any reasonable
`
`good-faith reliance or what they were told by experts or lawyers when the evidence established
`
`NetScout’s principal witnesses were not even interested or engaged enough to bother reviewing
`
`the Asserted Patents. “The jury was under no obligation to credit [NetScout’s] defenses as
`
`reasonable or infer that the defense was evidence of [NetScout’s] good-faith belief, particularly
`
`where there was no evidence about that belief.” Ericsson Inc. v. TCL Commun. Tech. Holdings,
`
`Ltd., No. 2:15-cv-00011-RSP, 2018 U.S. Dist. LEXIS 78857, at *30-33 (E.D. Tex. May 10,
`
`2018) (finding substantial evidence supported willfulness verdict and rejected defendant’s
`
`pleading of good faith where “[w]hat is missing, however, is any evidence from [defendant]
`
`regarding its actual, subjective beliefs. The [defendant] employees called by deposition at trial
`
`indicated only that they did not read the patent. It would be impossible to conclude that these
`
`employees reasonably believed the patent was invalid when the employees admitted they had no
`
`beliefs at all about the matter.”).
`
`4
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`

`

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`In any event, the jury was instructed that it “may not determine that the infringement
`
`was willful just because NetScout knew of the asserted patent and infringed it. Willful
`
`infringement, ladies and gentlemen, is reserved for only the most egregious behavior, such as
`
`where the infringement was wanton, malicious, in bad faith, deliberate, consciously wrong, or
`
`flagrant.” Dkt. 252, 32:4-14; emphasis added. “A jury is presumed to follow its instructions.”
`
`Weeks v. Angelone, 528 U.S. 225, 234 (2000). And here the jury found the willfulness standard
`
`satisfied even though it heard the NetScout witnesses’ vague and generic testimony about their
`
`reliance on attorneys and experts—thus “[t]he jury must have concluded that the defense was not
`
`reasonable enough to permit an inference that [NetScout] did not willfully infringe the patent.”
`
`Ericsson, 2018 U.S. Dist. LEXIS at *33.
`
`Moreover, nothing in Mr. Kenedi’s or Mr. Singhal’s testimony disclosed the timing of any
`
`investigations or development of defenses, nor did they disclose that they made any specific
`
`business decision after being put on detailed notice of infringement based on any specific
`
`defense to the claim other than conclusory testimony about conversations with lawyers or
`
`experts—the contents of which were not disclosed to the jury. “The jury’s finding that
`
`[NetScout’s] infringement was both culpable and egregious necessarily means that the jury did
`
`not credit [NetScout] with a good faith belief about the [Asserted Patents]. This was not a
`
`surprising result given the lack of evidence about the subjective beliefs of [NetScout’s] decision
`
`makers.” Ericsson, 2018 U.S. Dist. LEXIS at *34; see also id. at *32-33 (further holding that the
`
`fact that the case was not close contributed to its holding that substantial evidence supported the
`
`jury’s willfulness finding).
`
`C. NetScout Continues to Market and Promote Sales of the Infringing Products
`
`NetScout asserts that prior to trial the infringing products were being phased out in favor
`
`of promoting next-generation products. Mot. at 4. Such facts do not even come close to showing
`
`5
`
`

`

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`
`insufficient evidence for the willfulness verdict. First, NetScout did not identify or rely on the
`
`purported “phase out” of the infringing products in its Rule 50(a) willfulness motion. See
`
`10/12/2017 Day 3 PM Trial Tr. at 97:1-100:18. For this reason, NetScout cannot rely on this
`
`argument and evidence in its present motion. See Fed. R. Civ. P. 50(a)(2) (a Rule 50(a) “motion
`
`must specify the judgment sought and the law and facts that entitle a movant to the judgment.”);
`
`Bianco v. Globus Med., Inc., No. 2:12-CV-00147-WCB, 2014 U.S. Dist. LEXIS 151967, at *19-
`
`20 (E.D. Tex. Oct. 27, 2014) (“Globus did not raise that specific argument in its pre-verdict Rule
`
`50(a) motion for judgment as a matter of law. Globus has therefore waived the right to make that
`
`argument as part of its renewed motion for judgment as a matter of law under Rule 50(b).”)
`
`(citing Flowers v. S. Reg’l Physician Servs. Inc., 247 F.3d 229, 238 (5th Cir. 2001) and Duro-
`
`Last, Inc. v. Custom Seal, Inc., 321 F.3d 1098, 1107-08 (Fed. Cir. 2003)).
`
`Second, NetScout admits that Mr. Singhal testified that NetScout continues to sell the
`
`infringing products upon request from customers. Mot. at 4. And the jury could reasonably infer
`
`that NetScout decided it was more important to sell infringing products to any customer that
`
`requests them than it was to respect PI’s patent rights. The jury could have reasonably inferred
`
`that choosing greed (infringing sales) over respect for patent rights enshrined in the Constitution
`
`shows at least “deliberate” and/or “consciously wrong” and/or “flagrant” behavior.
`
`Third, NetScout misrepresents that it “ceased promoting sales of the accused products,”
`
`and “pulled the accused products from its marketing.” Mot. at 4. PI’s Motions for Enhanced
`
`Damages and For a Running Royalty established with declarations and exhibits that NetScout
`
`has not “pulled the accused products from marketing”—and in fact continued to promote the
`
`infringing products after the verdict. Dkt. 267 at 3-4, and Exs. A & B thereto; Dkt. 269 at 12.
`
`NetScout did not come forward with any contrary evidence. Moreover, NetScout continues to
`
`6
`
`

`

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`
`
`this day to market and promote sales of the infringing products front and center directly from
`
`NetScout’s homepage. See Gasser Decl. at ¶¶3-8; Exs. 1-4. Hovering over the “PRODUCT” link
`
`on NetScout’s homepage generates a product pull-down menu that lists “Iris/GeoProbe” under
`
`“Carrier Service Provider Products.” Clicking the “Iris/GeoProbe” link on the home page brings
`
`a customer directly to promotional materials for the infringing GeoProbe G10 and GeoBlade
`
`devices, as well as additional hyperlinks to their respective datasheets. Id. at ¶¶3-10; Exs. 1-6.
`
`Alternatively, a customer can click on (rather than hover over) the “products” link on NetScout’s
`
`homepage which takes a customer to “NetScout’s Products Overview Page,” which appears to
`
`itemize NetScout’s main product families. Id. at ¶¶11-13; Exs. 7-8. The seventh product family
`
`on the Products Overview page is “Iris/GeoProbe” that when clicked opens the main GeoProbe
`
`webpage with promotional material and datasheets for the infringing G10 and GeoBlade
`
`products. Id. at ¶¶11-13; Exs. 4, 7-8. NetScout’s decision to continue such open and blatant
`
`marketing of the infringing products from its homepage—while representing to the Court that it
`
`had “ceased” promotion and “pulled” the products from marketing—is troubling, and
`
`underscores that NetScout continues to “double-down” on its deliberate, flagrant, and undeniably
`
`willful infringement.
`
`D. NetScout’s Defenses Do Not Foreclose Willfulness
`
`NetScout cites WesternGeco LLC v. ION GeoPhysical Corp., 837 F.3d 1358, 1363 (Fed.
`
`Cir. 2016) to argue for the ongoing relevance of the objective reasonableness of NetScout’s
`
`defenses in the context of the willfulness verdict. Mot. at 5. But WesternGeco does not help
`
`NetScout because it relates solely to a district court’s discretion to enhance damages upon
`
`judgment of willfulness—it plainly does not hold, as NetScout contends, that objective
`
`reasonableness can vacate a jury verdict of willfulness. See WesternGeco, 837 F.3d at 1363
`
`(“After Halo, the objective reasonableness of the accused infringer's positions can still be
`
`7
`
`

`

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`
`relevant for the district court to consider when exercising its discretion.”) (emphasis added);
`
`See also Barry v. Medtronic, Inc., 230 F. Supp. 3d 630, 649-650 (“While it is true that objective
`
`reasonableness can still be relevant to the inquiry of whether enhanced damages are appropriate
`
`(see WesternGeco, 837 F.3d at 1363), an after-the-fact robust defense of invalidity cannot defeat
`
`a willfulness finding by a jury.”).
`
`As explained in PI’s concurrently filed oppositions to NetScout’s motions for JMOL of
`
`Invalidity and Non-infringement, PI not only provided evidence at trial to support the jury’s
`
`findings that the Asserted Patent Claims were infringed and not invalid, but PI’s testimony and
`
`cross-examination allowed the jury to make credibility determinations to the benefit of PI’s
`
`witnesses and arguments, and to the detriment of NetScout’s witnesses and arguments, entitling
`
`the jury to decide this was not a close case, and that NetScout did not have good-faith non-
`
`infringement or invalidity arguments—i.e., that NetScout’s infringement was wanton, malicious,
`
`in bad-faith, deliberate, consciously wrongful or flagrant.
`
`IV. CONCLUSION
`
`For the reasons stated above and previously identified by this Court in its enhancement
`
`opinion (Dkt. 305), this Court should deny NetScout’s Motion for JMOL on willful infringement.
`
`
`
`
`
`
`
`
`
`
`
`
`
`8
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`

`

`Case 1:17-cv-00770-JDW Document 259-5 Filed 11/02/23 Page 13 of 13 PageID #: 29248
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`
`Dated: October 26, 2018
`
`
`
`
`
`
`
`Respectfully submitted,
`
`/s/ Alexander E. Gasser
`Paul J. Skiermont (Bar No. 24033073)
`Sarah E. Spires (Bar No. 24083860)
`Sadaf R. Abdullah (Bar No. 24093500)
`Steven W. Hartsell (Bar No. 24040199)
`Alexander E. Gasser (Bar No. 1022659WI)
`Steve J. Udick (Bar No. 24079884)
`SKIERMONT DERBY LLP
`1601 Elm Street, Suite 4400
`Dallas, Texas 75201
`Tel. (214) 978-6600
`Fax (214) 978-6601
`pskiermont@skiermontderby.com
`sspires@skiermontderby.com
`sabdullah@skiermontderby.com
`shartsell@skiermontderby.com
`agasser@skiermontderby.com
`sudick@skiermontderby.com
`
`William E. Davis, III
`Texas State Bar No. 24047416
`THE DAVIS FIRM, PC
`213 N. Fredonia Street, Suite 230
`Longview, Texas 75601
`Telephone: (903) 230-9090
`Facsimile: (903) 230-9661
`Email : bdavis@bdavisfirm.com
`
`Counsel for Plaintiff
`Packet Intelligence LLC
`
`
`
`CERTIFICATE OF SERVICE
`
`I hereby certify that counsel of record who are deemed to have consented to electronic
`
`service are being served with a copy of this document via the Court’s CM/ECF system per Local
`
`Rule CV-5(a)(3), on this the 26th day of October, 2018.
`
`/s/ Alexander E. Gasser
`
`
`
`9
`
`

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