Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 1 of 8 PageID #: 29584
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`Exhibit B
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`Exhibit B
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`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 2 of 8 PageID #: 29585
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`8/11/2023
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`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 1
`
` IN THE UNITED STATES DISTRICT COURT
` FOR THE DISTRICT OF DELAWARE
`___________________________________
`IN RE MATTER OF: )
`WIRTGEN AMERICA, INC., )
`Plaintiff/Counterclaim-Defendant, ) C.A. No.:
` vs. ) 1:17-cv-00770-JDW-MPT
`CATERPILLAR, INC., )
`Defendant/Counterclaim-Plaintiff. )
`___________________________________)
`
` *** HIGHLY CONFIDENTIAL ***
` VIDEOTAPED DEPOSITION OF BRETT L. REED
` PALO ALTO, CALIFORNIA
` Friday, August 11, 2023
`
`Stenographically Reported by:
`HEATHER J. BAUTISTA, CSR, CRR, RPR, CLR
`Realtime Systems Administrator
`California CSR License #11600
`Oregon CSR License #21-0005
`Washington License #21009491
`Nevada CCR License #980
`Texas CSR License #10725
`______________________________________________________
` DIGITAL EVIDENCE GROUP
` 1730 M Street, NW, Suite 812
` Washington, D.C. 20036
` (202) 232-0646
`
`www.DigitalEvidenceGroup.comDigital Evidence Group C'rt 2023
`
`202-232-0646
`
`
`
`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 3 of 8 PageID #: 29586
`
`8/11/2023
`
`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 114
`question wasn't very clear. You're just asking
`about the date of the hypothetical negotiation --
` Q. Yes.
` A. -- and the -- the date of first
`infringement?
` Q. The -- the date that you used for your
`hypothetical negotiation for Wirtgen's asserted
`patent was 2014; correct?
` A. Mid 2014, yeah, based on the date of first
`infringement of the -- of an accused product.
` Q. But you agree that using a later date may
`increase the resulting royalty payment; correct?
` MR. LISTON: Object to form.
` THE WITNESS: There -- there is some
`discussion in my report, and perhaps we could point
`to that specifically if you want to follow up, that
`there could be circumstances where it would make a
`difference. So I -- I do acknowledge that there --
`there is a potential for what I would view as fairly
`modest adjustments to take into account what might
`be called a hold-up situation with a later date.
` Q. (By Ms. Wells) And in particular, the
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`www.DigitalEvidenceGroup.comDigital Evidence Group C'rt 2023
`
`202-232-0646
`
`
`
`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 4 of 8 PageID #: 29587
`
`8/11/2023
`
`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 115
`adjustments you're referring to for the later date
`would be upward, they would increase the royalty
`amount?
` A. Correct; consistent with the concept of a
`hold-up where -- where Wirtgen America would be
`attempting to get larger amounts because of --
`because of the imminence of the introduction of --
`of additional PM-600 units around 2016.
` Q. Why did you use 2014 as the date of your
`hypothetical negotiation?
` A. Well, it's addressed in my report, but
`the -- the date of the hypothetical negotiation, my
`understanding of -- of the law and my experience in
`doing this on 30 patent infringement trials and
`numerous other matters, is that the date of first
`infringement is the first sell, offer to sell,
`import, use of a product that -- that embodies the
`accused functionality. And the -- the record
`indicated that there was prototype units as well as
`pilot units, and it was true with the PM-3XX. And
`Dr. Seth actually pointed to their earliest of the
`prototype for the PM-3XX, but it was also true with
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`www.DigitalEvidenceGroup.comDigital Evidence Group C'rt 2023
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`202-232-0646
`
`
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`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 5 of 8 PageID #: 29588
`
`8/11/2023
`
`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 116
`the PM-6XX, and the record identified that there
`was -- the first serial number of the first build of
`the PM-6XX was imported in mid 2014. It was
`delivered to Minnesota around July 4th, 2014.
` Mr. Englemann -- I'm pronouncing that
`wrong. I'm sorry.
` Q. Englemann.
` A. Mr. Englemann was -- was there at the time
`and was part of the -- the group that received the
`delivery of this unit. This unit had the capability
`that's accused in the infringement, and it was used
`throughout 2014, starting in July 2014, continued to
`be used in 2015. Additional pilots were brought in
`in 2015. So the first import was just before July,
`2014. The first use was occurring in July 2014,
`continuing.
` So my understanding is that that would be
`consistent with the -- with the date of first
`infringement since these patents, all but two of
`them, I believe, had previously issued.
` Q. When you performed your analysis, did you
`believe that the -- the prototype that had been --
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`www.DigitalEvidenceGroup.comDigital Evidence Group C'rt 2023
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`202-232-0646
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`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 6 of 8 PageID #: 29589
`
`8/11/2023
`
`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 146
` But then I point out on the other hand, the
`damages -- according to Wirtgen America's claims,
`the damages period don't begin for the '972 patent
`until 2021. That would be -- whatever increment
`would be relevant in terms of higher royalty rate
`that you're asking about wouldn't be applicable to
`the damage accounting period here, because the
`damage accounting period for the '972 patent doesn't
`begin until 2021.
` Q. But you've not performed a separate
`analysis that would apply if the Court or the jury
`in this case finds that 2014 is not the proper
`hypothetical negotiation date?
` A. I -- I've acknowledged that in some cases
`there would be an upward adjustment, but I have not
`quantified that upward adjustment on -- on the
`particular -- particular examples where that would
`be applicable.
` And it wouldn't be the -- wouldn't be the
`'530 patent, because the patent hadn't issued yet;
`wouldn't be the RE '268 patent; that patent hadn't
`issued yet.
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`www.DigitalEvidenceGroup.comDigital Evidence Group C'rt 2023
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`202-232-0646
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`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 7 of 8 PageID #: 29590
`
`8/11/2023
`
`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 147
` It wouldn't be the '972 patent, because
`that patent had -- didn't have a damage accounting
`period starting till later.
` It wouldn't be the '641 patent because of
`ease of the modification there.
` So there would be potential adjustment for
`the '309 patent, but I haven't quantified that
`specifically.
` Q. At the time of the hypothetical
`negotiation, Caterpillar viewed its investment in
`cold milling machines as strategic to its position
`in road construction equipment; correct?
` A. Correct; and that's definitely true in --
`in mid 2014.
` Q. Would that also be true if the hypothetical
`negotiation date were 2016?
` A. Yes, it would be true in both those time
`periods.
` Q. At the time of the hypothetical
`negotiation, Caterpillar intended for its PM-300,
`600, and 800 series machines to compete directly
`with Wirtgen; correct?
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`www.DigitalEvidenceGroup.comDigital Evidence Group C'rt 2023
`
`202-232-0646
`
`
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`Case 1:17-cv-00770-JDW Document 287-1 Filed 01/19/24 Page 8 of 8 PageID #: 29591
`
`8/11/2023
`
`Wirtgen America Inc. v. Caterpillar Inc.
`Highly Confidential
`
`Brett L. Reed
`
`Page 289
` I, HEATHER J. BAUTISTA, CSR No. 11600, Certified
`Shorthand Reporter, certify:
` That the foregoing proceedings were taken before
`me at the time and place therein set forth, at which
`time the witness declared under penalty of perjury; that
`the testimony of the witness and all objections made at
`the time of the examination were recorded
`stenographically by me and were thereafter transcribed
`under my direction and supervision;
` That the foregoing is a full, true, and correct
`transcript of my shorthand notes so taken and of the
`testimony so given;
` ( ) Reading and signing was requested/offered.
` (XX) Reading and signing was not requested/offered.
` ( ) Reading and signing was waived.
` I further certify that I am not financially
`interested in the action, and I am not a relative or
`employee of any attorney of the parties, nor of any of
`the parties.
` I declare under penalty of perjury under the laws
`of California that the foregoing is true and correct.
`
` Dated: August 21, 2023
`
` _______________________________________
` HEATHER J. BAUTISTA, CSR, CRR, RPR, CLR
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`202-232-0646
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