Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 1 of 12 PageID #: 37836
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELA WARE
`
`VLSI TECHNOLOGY LLC,
`
`Plaintiff,
`
`v.
`
`C.A. No. 18-966-CFC-CJB
`
`INTEL CORPORATION,
`
`Defendant
`
`MEMORANDUM ORDER
`
`Defendant Intel has filed a motion to exclude certain testimony of Plaintiff
`
`VLSI's technical expert, Dr. Thomas M. Conte. D.I. 787.
`
`I.
`
`Resolution of the motion is governed by Federal Rules of Evidence 402,
`
`403, and 702. Rule 402 provides that
`
`[ r ]elevant evidence is admissible unless ... provide[ d]
`otherwise [by] the United States Constitution; a federal
`statute; these rules; or other rules prescribed by the
`Supreme Court. Irrelevant evidence is not admissible.
`
`Fed. R. Evid. 402.
`
`Under Rule 403,
`
`[t]he court may exclude relevant evidence if its probative
`value is substantially outweighed by a danger of one or
`more of the following: unfair prejudice, confusing the
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELA WARE
`
`VLSI TECHNOLOGY LLC,
`
`Plaintiff,
`
`v.
`
`C.A. No. 18-966-CFC-CJB
`
`INTEL CORPORATION,
`
`Defendant
`
`MEMORANDUM ORDER
`
`Defendant Intel has filed a motion to exclude certain testimony of Plaintiff
`
`VLSI's technical expert, Dr. Thomas M. Conte. D.I. 787.
`
`I.
`
`Resolution of the motion is governed by Federal Rules of Evidence 402,
`
`403, and 702. Rule 402 provides that
`
`[ r ]elevant evidence is admissible unless ... provide[ d]
`otherwise [by] the United States Constitution; a federal
`statute; these rules; or other rules prescribed by the
`Supreme Court. Irrelevant evidence is not admissible.
`
`Fed. R. Evid. 402.
`
`Under Rule 403,
`
`[t]he court may exclude relevant evidence if its probative
`value is substantially outweighed by a danger of one or
`more of the following: unfair prejudice, confusing the
`
`
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 2 of 12 PageID #: 37837
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`issues, misleading the jury, undue delay, wasting time, or
`needlessly presenting cumulative evidence.
`
`Fed. R. Evid. 403.
`
`Rule 702 provides:
`
`A witness who is qualified as an expert by knowledge,
`skill, experience, training, or education may testify in the
`form of an opinion or otherwise if:
`(a) the expert's scientific, technical, or other
`specialized knowledge will help the trier of fact to
`understand the evidence or to determine a fact in
`issue;
`(b) the testimony is based on sufficient facts or data;
`( c) the testimony is the product of reliable principles
`and methods; and
`( d) the expert has reliably applied the principles and
`methods to the facts of the case.
`
`Fed. R. Evid. 702.
`
`II.
`
`Intel asks first that I exclude Conte's testimony "about Intel's purported
`
`litigation misconduct, corporate culture, and ethics." D.I. 788 at 1. Intel argues
`
`that Conte's opinions on these matters "are baseless, irrelevant, beyond his
`
`technical expertise, highly prejudicial to Intel, and likely to mislead the jury." D.I.
`
`788 at 1. I lack sufficient information to judge whether Conte' s opinions on these
`
`matters are baseless, but I agree with Intel that any opinions Conte might offer on
`
`such matters are irrelevant, beyond his expertise, highly prejudicial to Intel, and
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`2
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 3 of 12 PageID #: 37838
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`likely to mislead a jury; and they are therefore inadmissible under Rules 403 and
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`702.
`
`The jury will be asked to decide in the first phase of the trial whether Intel
`
`infringed the asserted patents and whether the asserted patents are invalid. If the
`
`jury decides that at least one of the asserted patents was infringed and is not
`
`invalid, it will be tasked with deciding whether VLSI is entitled to damages.
`
`Intel's purported litigation misconduct, corporate culture, and ethics have no
`
`relevance to any of the infringement, invalidity, or damages issues that will be
`
`presented to the jury. And any conceivable probative value Intel's purported
`
`litigation misconduct, corporate culture, and ethics could have would be
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`substantially outweighed by the danger of unfair prejudice against Intel, confusing
`
`the issues, misleading the jury, and wasting time. In addition, Conte is an engineer
`
`with no qualifications that would enable him to offer reliable opinions about
`
`litigation misconduct and ethics. Accordingly, I will exercise my discretion and
`
`preclude him under Rules 402,403, and 702 from offering opinions at trial about
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`Intel's purported litigation misconduct, corporate culture, and ethics.
`
`VLSI says Conte' s testimony on these issues is appropriate because his
`
`expert analysis was limited by "the onerous conditions Intel placed on his code
`
`review, and Intel's delayed productions and non-production of pertinent materials."
`
`D.I. 865 at 1. VLSI seems to be alleging here that Intel violated its discovery
`
`3
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`
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 4 of 12 PageID #: 37839
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`obligations under the Court's orders and/or the Federal Rules of Civil Procedure.
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`But if VLSI thought that Intel failed to comply with its discovery obligations and
`
`that that failure prejudiced Conte's analysis, VLSI should have sought relief from
`
`the Court. It is not the province of the jury to hear and decide discovery disputes.
`
`VLSI insists that it needs to offer Conte' s opinions about "Intel's repeated
`
`violations of Intel's 'Corporate Conduct/Ethics,"' because Intel intends to "argue
`
`its corporate ethics provide a defense to patent infringement." D.I. 865 at 2-3
`
`( citation omitted). But Intel has promised that it "will demonstrate
`
`noninfringement on the merits." D.I. 900 at 1-2. If Intel does not abide by that
`
`representation and offers at trial self-serving testimony to the effect that it does not
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`infringe patents because of its ethics policies, it may open the door to allow VLSI
`
`to introduce evidence that Intel does not comply with those policies. But even if
`
`Intel opened that door, I do not see how Conte could be the source of such
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`counterevidence, as he is not offered as a fact witness with percipient knowledge
`
`of Intel's alleged misconduct, and VLSI has not suggested that he is an expert on
`
`corporate ethics.
`
`Accordingly, Conte may not testify at trial about Intel's purported litigation
`
`misconduct, corporate culture, and ethics.
`
`4
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`
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 5 of 12 PageID #: 37840
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`III.
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`Intel next asks that I bar Conte from testifying at trial that Intel derives more
`
`"benefit" from infringing the dependent claims of an asserted patent (the #027
`
`patent) than it does from infringing the independent claims from which the
`
`dependent claims depend. D.I. 788 at 1, 5. Independent claims 1, 8, and 18 of the
`
`#027 patent require adjusting voltage levels of an integrated circuit based on an
`
`"analog variation parameter." D.I. 789-1, Ex. 2 at claims 1, 8, 18. Dependent
`
`claims 3, 5, and 10 (which depend from claims 1 or 8) "further" require adjusting
`
`voltage levels based on a "digital variation parameter." D.I. 789-1, Ex. 2 at claims
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`3, 5, 10. Thus, although the independent claims cover devices that use an "analog
`
`variation parameter" both with and without a "digital variation parameter," the
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`dependent claims cover only devices that use both analog and digital variation
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`parameters.
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`In his expert report, Conte says that he "expect[s] each of the Accused
`
`Products [that uses only the analog variation parameter] to obtain at least a 1.18%
`
`power savings benefit from Intel's infringement of claims 1, 8, and 18," and he
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`"expect[s] each of the Accused Products [that uses both the analog and digital
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`variation parameters] to obtain at least a 2.63% power savings benefit from Intel's
`
`infringement of claims 3, 5, and 10." D.I. 789-1, Ex. 1 ,r,r 828-29. Conte further
`
`opines that "[t]he[] benefits" obtained from infringing the dependent claims "are
`
`5
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 6 of 12 PageID #: 37841
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`additive to the benefits the Accused Products obtain from infringing [ the
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`independent] claims" and that "[t]hese benefits are fully apportioned to be
`
`coextensive with the claims." D.I. 789-1, Ex. 1 ,I,I 829-30. Relying on these
`
`opinions, VLSI's damages expert, Dr. Ryan Sullivan, opines that Intel owes $1.6
`
`billion for infringing the independent claims and an additional $2.3 billion for
`infringing the dependent claims. D.I. 789-1, Ex. 3 ,i,r 315-16.
`
`Intel argues that I need to preclude Conte from offering these opinions about
`
`the relative benefits of Intel's infringement of the independent and dependent
`
`claims because
`
`[i]t would be legal error to allow VLSI to argue at trial that
`the narrowing elements recited in a dependent claim(cid:173)
`each of which further /imi,ts the scope of the dependent
`claim-somehow create additional value beyond the
`underlying independent claim, which by definition,
`encompasses everything in the dependent claim and more.
`
`D.I. 788 at 6 ( emphases in original). Intel does not identify a Rule of Evidence that
`
`bars the admission of Conte's opinions, but I take it as a given that an expert's
`
`opinions that are incorrect as a matter of law are inadmissible as irrelevant under
`
`Rules 402 and 403 and unreliable under Rule 702. And I agree with Intel that
`
`Conte's opinions about the relative benefits he "expects" Intel "to obtain" from
`
`infringement of the independent and dependent claims of the #027 patent are
`
`wrong as a matter of law; and, therefore, I will bar him under Rules 402, 403, and
`
`702 from offering those opinions at trial.
`
`6
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`
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 7 of 12 PageID #: 37842
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`As an initial matter, Conte errs in saying that Intel "obtains" "benefits" from
`
`infringement. Patents convey two benefits. The first, granted to the patentee, is
`
`the right to exclude others for a limited period from practicing the invention recited
`
`in the patent's claims. 35 U.S.C. § 154(a){l) ("Every patent shall contain ... a
`
`grant to the patentee ... of the right to exclude others from making, using, offering
`
`for sale, or selling the invention .... "); see Waterman v. Mackenzie, 138 U.S. 252,
`
`255 (1891). The second benefit, the disclosure of the claimed invention in the
`
`patent's specification, is enjoyed by the public at large and is the price the patentee
`
`pays to garner its right to exclude. See Scott Paper Co. v. Marca/us Mfg. Co., 326
`
`U.S. 249, 255 (1945) ("By the patent laws Congress has given to the inventor
`
`opportunity to secure the material rewards for his invention for a limited time, on
`
`condition that he make full disclosure for the benefit of the public of the manner of
`
`making and using the invention, and that upon the expiration of the patent the
`
`public be left free to use the invention."); id. (noting that an "aim of the patent laws
`
`is not only that members of the public shall be free to manufacture the product or
`
`employ the process disclosed by the expired patent, but also that the consuming
`
`public at large shall receive the benefits of the unrestricted exploitation, by others,
`
`of its disclosures"). "Infringement" is the legal determination that a party
`
`interfered with the patentee's exclusionary right by practicing the claimed
`
`invention "without authority." 35 U.S.C. § 271. The infringing party may well
`
`7
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 8 of 12 PageID #: 37843
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`have benefitted from practicing the invention, but it does not "obtain benefits"
`
`from a finding that it infringed the patent.
`
`Conte compounds his first error by saying that a dependent claim provides
`
`"a benefit" that is "additive" to the benefits offered by the independent claim from
`
`which it depends. VLSI, too, insists in its briefing that a dependent claim "covers
`
`more inventive benefit" than its corresponding independent claim. D.I. 865 at 5
`
`( emphasis omitted). But the law says the opposite. Under § 112( d) of the Patent
`
`Act, "a claim in dependent form shall contain a reference to a claim previously set
`
`forth and then specify afurther limitation of the subject matter claimed. A claim
`
`in dependent form shall be construed to incorporate by reference all the limitations
`
`of the claim to which it refers." 35 U.S.C. § 112(d) (emphasis added). Thus, the
`
`limitations that a dependent claim "adds" to an independent claim are precisely
`
`that-limitations that limit the coverage of the dependent claim to a scope that is
`
`narrower than the scope of the independent claim. It is the independent claim that
`
`is broader and "covers more inventive benefit" for the patentee. 1 Thus, with
`
`respect to infringement, any "benefit" of a dependent claim is already covered by
`
`the independent claim from which it depends.
`
`1 To the extent a dependent claim reveals something not expressly recited in the
`independent claim, it might be said (albeit awkwardly) that the public "obtains" an
`"additive" benefit from the dependent claim. But that is of no moment in a patent
`infringement case.
`
`8
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`
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 9 of 12 PageID #: 37844
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`Conte' s error in opining about the relative "benefits" Intel "obtains" from
`
`infringing the #027 patent's dependent and independent claims is further
`
`compounded because his opinions are being offered to support VLSI's damages
`
`claims. The relevant question for damages in a patent infringement case is not
`
`what the defendant gained by practicing the patent, but rather what the plaintiff lost
`
`because of the defendant's infringement. When a patentee is deprived of its right
`
`to exclude others from practicing the patent, it is entitled to "damages adequate to
`
`compensate for the infringement, but in no event less than a reasonable royalty for
`
`the use made of the invention by the infringer, together with interest and costs as
`
`fixed by the court." 35 U.S.C. § 284 (emphasis added.) The purpose of
`
`compensatory damages is to make the injured party whole. Thus, as the Federal
`
`Circuit held in Mentor Graphics Corp. v. EVE-USA, Inc., 851 F.3d 1275 (Fed. Cir.
`
`2017): "[t]he question to be asked in determining damages is how much had the
`
`Patent Holder ... suffered by the infringement. And that question (is) primarily:
`
`had the Infringer not infringed, what would [the] Patent Holder[] have made?" Id.
`
`at 1284 (first alteration in original) (internal quotation marks and citations
`
`omitted).
`
`Since infringement of a dependent claim necessarily constitutes
`
`infringement of the independent claim from which the dependent claim depends,
`
`the patentee's losses caused by the infringement of the dependent claim cannot be
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`9
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 10 of 12 PageID #: 37845
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`higher than the losses caused by infringement of its corresponding independent
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`claim. A rational licensee would not pay-and thus a patentee could not obtain(cid:173)
`
`in a hypothetical negotiation under Georgia-Pacific a higher royalty for the right to
`
`practice a valid dependent claim than the licensee would pay to practice the
`
`broader corresponding independent claim. If anything, the royalty would be higher
`
`for the broader independent claim. A car with a radio may be more valuable than a
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`car without a radio, but the right to sell cars with and without radios is more
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`valuable than the right to sell only cars with radios.
`
`It may be, as VLSI maintains, that Intel makes more money selling products
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`that have both analog and digital parameters because products with both
`
`parameters are sold at higher prices than products with only analog parameters.
`
`See D.I. 865 at 5-6. But since both the independent and the dependent claims
`
`cover products with digital parameters, VLSI does not gain any "additive benefit"
`
`from Intel's infringement of the dependent claims. Cf Wahpeton Canvas Co. v.
`
`Frontier, Inc., 870 F.2d 1546, 1552 n.10 (Fed. Cir. 1989) ("Infringement of an
`
`independent claim would result in the same damage award as would infringement
`
`of all claims dependent thereon and non-infringement of an independent claim
`
`carries with it non-infringement of all claims dependent thereon.").
`
`For these reasons, I will grant Intel's request to bar Conte from testifying at
`
`trial that Intel derives more benefit from practicing the dependent claims of the
`
`10
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 11 of 12 PageID #: 37846
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`#027 patent than it does from practicing the patent's independent claims. D.I. 788
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`at 1, 5.
`
`IV.
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`Lastly, Intel asks me to preclude Conte from offering at trial opinions about
`
`the Accused Products' power savings that are based on his simulation of a single
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`Intel Product. D.I. 788 at 8. Intel faults Conte for "treat[ing] that simulation as
`
`representative of hundreds of other accused products-across different families,
`
`types, configurations, and generations." D.I. 788 at 8 ( emphases omitted). And it
`
`says that Conte "did not even attempt to account for the countless differences
`
`across these many products, and instead merely offered his speculative
`
`'expect[ation]' that the differences do not matter." D.I. 788 at 8 (alteration in
`
`original) ( citing D.I. 789-1, Ex. 1 ,r,r 3 75, 828-29). These objections, however, go
`
`to the weight, not the admissibility, of Conte's opinions. Intel is free to raise these
`
`issues when it cross examines Conte at trial. Accordingly, I will deny Intel's
`
`motion in this regard.
`
`* * * *
`
`11
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`
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`Case 1:18-cv-00966-CFC-CJB Document 971 Filed 06/27/22 Page 12 of 12 PageID #: 37847
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`NOW THEREFORE, at Wilmington on this Twenty-seventh day of June in
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`2022, Defendant Intel Corporation's Motion to Exclude Evidence from Dr.
`
`Thomas M. Conte (D.I. 787) is GRANTED IN PART and DENIED IN PART:
`
`1. Dr. Conte is barred from offering opinions at trial about Intel's purported
`
`litigation misconduct, corporate culture, and ethics;
`
`2. Dr. Conte is barred from testifying at trial that Intel derives more benefit
`
`from practicing the dependent claims of the #027 patent than it does from
`
`practicing the patent's independent claims; and
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`3. Intel's motion is DENIED in all other respects.
`
`UNITED STATES CHIEF
`DISTRICT JUDGE
`
`12
`
`
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