throbber
Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 1 of 217
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`IN THE UNITED STATES DISTRICT COURT
`MIDDLE DISTRICT OF NORTH CAROLINA
`
`)
`
`
`OPTOLUM, INC., )
`
` Greensboro, North Carolina )
` Plaintiff, October 26, 2021
` )
` vs. )
`
`)
`CREE, INC., )
`
` Case No. 1:17CV687 )
` Defendant. )
`_________________________________ )
`
`
`
`TRANSCRIPT OF TRIAL DAY 2
`BEFORE THE HONORABLE WILLIAM L. OSTEEN, JR.
`UNITED STATES DISTRICT JUDGE
`
`
`APPEARANCES:
`
`For the Plaintiff: ROBERT BROOKS
`LEAH R. MCCOY
`MCCARTER & ENGLISH, LLP
`265 FRANKLIN STREET
`BOSTON, MA 02110
`
`
`
`JACOB S. WHARTON
`WOMBLE BOND DISKINSON (US) LLP
`1 W. 4th STREET
`WINSTON-SALEM, NC 27101
`
`
`For the Defendant: BLANEY HARPER
`JONES DAY
`51 LOUISIANA AVE., N.W.
`WASHINGTON, DC 20001
`
`
`
`PETER D. SIDDOWAY
`SAGE PATENT GROUP
`4242 SIX FORKS ROAD, SUITE 1550
`RALEIGH, NC 27609
`
`Joseph B. Armstrong, FCRR
`Court Reporter:
` 324 W. Market, Room 101
`Greensboro, NC 27401
`
`
`
`Proceedings reported by stenotype reporter.
`Transcript produced by Computer-Aided Transcription.
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 2 of 217
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`WITNESSES FOR THE PLAINTIFF: PAGE
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`I N D E X
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`JOEL DRY
`Direct Examination By Mr. Brooks
`Cross-Examination By Mr. Harper
`Redirect Examination By Mr. Brooks
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`KAREN L. BAKER
`Direct Examination By Ms. McCoy
`Cross-Examination By Mr. Harper
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`67
`117
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`140
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`DANIEL ALEXANDER STEIGERWALD
`Direct Examination By Mr. Martinson
`Cross-Examination By Mr. Harper
`Redirect Examination By Mr. Martinson
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`145
`189
`206
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`EXHIBITS: RCVD
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`PX 619
`PX 621
`PTX 631
`PTX 635
`PTX 663
`PTX 664
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`FloTHERM computer model
`Drawing - Property of G&B Lighting, Inc.
`US Patent '028
`US Patent '303
`Tear-down analysis of Cree XB-G LEDs
`Tear-down analysis 40-watt Cree bulb & Cree
`XT-E LEDs
`Tear-down analysis of Cree lightbulbs
`Product data sheet -Lumileds Luxeon 1-watt
`emitter
`Product Data Sheet XLamp XB-G LED
`Product Data Sheet for Cree XLamp XB-E
`Product Data Sheet XLamp XT-E
`Application brief for thermal design-Luxeon
`powered light sources
`Application note re: thermal management of
`XLamp LEDs
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`PTX 672
`PTX 1193
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`PTX 1194
`PTX 1195
`PTX 1196
`PTX 1198
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`PTX 1199
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 3 of 217
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`P R O C E E D I N G S
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`(At 9:20 a.m., proceedings commenced.)
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`THE COURT: All right. So, preliminarily, before we
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`proceed with Mr. Dry, a couple of things. First of all, the
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`issues came up yesterday with respect to -- well, it started as
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`one issue and morphed into two issues.
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`Number one, the principal issue was how much --
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`whether or not testimony from Mr. Dry explaining why passage of
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`time in filing his lawsuit was relevant or not. Plaintiff
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`objects to that testimony. Defendant contends that the answer
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`given by Mr. Dry was that he couldn't afford an attorney, but
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`the fact that he waited several years is of some relevance,
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`first of all.
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`And then, second, as it turned out, there's likely to
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`be additional evidence with respect to Mr. Dry's discovery of
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`what he contends is the infringing technology in the Cree bulb,
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`and where we go with that, to some degree. I don't know any
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`way around the fact that there's going to be evidence presented
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`with respect to when the lawsuit was actually filed. So I'm
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`going to go piece by piece.
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`First of all, I don't know of any evidence that has
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`been forecast or is somehow inferrable from the list of
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`witnesses with respect to this particular point whether or not
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`a Plaintiff inventor in a patent case is acting outside
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`business custom by either sending a letter notifying of
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 4 of 217
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`infringement, not sending a letter notifying of infringement,
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`filing a complaint without a demand or a letter of notice, or
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`filing a complaint with a letter of notice. I don't see any
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`relevance as to that testimony, first of all, whether it's
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`accurate or not.
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`And, second, to the extent it has any limited
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`relevance, I don't -- I had excluded it under 403 because I
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`think that's a complete waste of time and very confusing to try
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`to trace what may be customary with respect to the assertion of
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`patent rights and the necessity of a demand letter, or the lack
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`of a demand letter, or when the infringer got notice of it. So
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`that testimony's excluded.
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`To the more important issue, I don't see any way to
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`avoid evidence of the passage of time between whenever the
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`discovery of the infringement occurred and the filing of the
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`lawsuit in this particular case. I think the question -- or
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`questions relating to why there was this delay appear, on their
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`face -- certainly have a certain logical appeal in terms of
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`relevance. But, unfortunately, the answers that are coming --
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`unfortunately, I don't care whether it's fortunate or not --
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`but the answers that are coming, assuming the answer would be
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`"I couldn't afford an attorney," opens up a host of problems.
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`Number one, that answer is simply belied by the fact
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`that Mr. Dry is present here in court with attorneys from
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`Boston and Winston-Salem. And, as a result, getting into that,
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 5 of 217
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`to some degree, attacks Mr. Dry's credibility just by virtue of
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`the fact that he is present in court with counsel at this
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`particular juncture, whatever the financial arrangements might
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`be.
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`And, number two, it further opens the door to a host
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`of irrelevant issues, whether it's a contingent fee case, or
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`whether there's some other agreement, and why the delay would
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`have taken -- so why there would have been delay. Could've
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`been lawyer, could have been some -- Mr. Dry's fault. Could've
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`been legal delay. It could have been delay in testing the
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`product. Who knows what factors might be addressed with
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`respect to why there was a significant amount of delay.
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`So, ultimately, in terms of inquiring -- questions
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`inquiring as to why the delay, I'm going to exclude that at
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`this point. I don't see, number one, any substantial amount of
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`relevance to it. And, number two, as I indicate, I think
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`there's enough issues with that primarily leading us into a
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`mini-trial of what's reasonable and what's not in terms of
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`attempting to enforce a patent and engaging attorneys, and what
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`it costs, and all those kind of issues.
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`And I think that type of confusion is just -- again,
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`I think that's a complete waste of time in this case. And I
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`think it can lend itself to tremendous confusion in terms of
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`injecting into the case legal tactics, legal decisions, and
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`other things, and give those -- make those somehow appear to be
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 6 of 217
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`relevant to the jury's decision.
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`So I would allow -- because I think, at some point,
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`it's going to come in anyway, I would allow a question as to
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`when -- the questions about discovery of the infringement,
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`certainly, and fair cross-examination on those particular
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`issues. I think that door's been opened wide by the opening
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`statements.
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`In terms of relevance, it's almost inconceivable to
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`me that an individual whose life, as was described yesterday,
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`has been so devoted to LED technology that they would not have
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`a snicker of curiosity about what powered this apparently
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`successful Cree lightbulb. They purchase it, and use it, and
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`never give it another thought. And I think that certainly
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`bears on various issues in the case, most predominantly
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`willfulness, and that is how readily identifiable it was that
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`Cree technology was actually an infringement of OptoLum
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`technology.
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`I think the delay in filing, even though I'm going to
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`allow a question as to when the lawsuit was filed, might help
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`the jury put a number of things they hear in perspective, I
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`certainly wouldn't allow and will not allow a lot of argument
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`as to inferences to be drawn from that. I might allow a little
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`bit, but not a lot, depending on how all the evidence in the
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`case goes.
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`So I think -- and, frankly, while I would have liked
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 7 of 217
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`to have kept willfulness in a nice, neat package during the
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`course of this trial, I think we're in a position now where, by
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`virtue of the opening statements, Cree's reputation, to some
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`degree, has been put on trial here with the betrayal of Mr. Dry
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`and OptoLum -- I say this respectfully but just to
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`illustrate -- is that the little guys within the industry who
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`are working hard to make a living and build a business versus
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`the major corporate presence in the industry that infringed to
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`get where it is today.
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`And I'll forewarn everyone, I'm going to be
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`struggling to get that -- that kind of extraneous, irrelevant
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`information out of this trial as we proceed because I think
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`this is a battle of facts, it's a battle over the technology,
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`it's a battle over whether or not a patent is infringed, it's a
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`battle over whether or not there was a willful infringement,
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`legal issues as to whether the patent is indefinite, and,
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`ultimately, damages calculated based upon a hypothetical,
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`reasonable royalty in the case.
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`Now, I'll give everybody something else to think
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`about as we proceed, and that is with respect to willfulness.
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`After hearing some of the opening statements, I don't read the
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`law on the issue of willfulness to permit whether or not a --
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`you know, a company or an infringer is a good person or a bad
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`person, or whether the inventor is a good person or a bad
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`person. There are specific legal requirements to prove
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 8 of 217
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`willfulness. And I'm just going to explain my present struggle
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`after hearing the opening statements yesterday. Let's see.
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`Willful infringement must be based on Cree's
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`knowledge and actions at the time of the infringement. You
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`must also find that Cree engaged in additional conduct that
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`shows it deliberately infringed OptoLum's patent rights. That
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`deliberate infringement includes intentional infringement.
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`The fed circuit instructions direct the jury to
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`consider the following facts -- factors or facts, however you
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`want to describe it.
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`Whether or not Cree acted consistently with the
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`standards of behavior for its industry.
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`Whether or not Cree intentionally copied a product of
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`OptoLum that is covered by the patent.
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`Whether or not Cree reasonably believed it did not
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`infringe or the patent was invalid.
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`Four: Whether or not Cree made a good faith effort
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`to avoid infringing the patent.
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`And five: Whether or not Cree tried to cover up its
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`infringement.
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`Now, that instruction specifically says: "Including
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`but not limited to." "Facts you may consider include but are
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`not limited to..."
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`Now, in determining if the jury should find
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`willfulness, I'm sure the parties are all aware of the Reed
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 9 of 217
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`factors that I'm to consider in terms of assessing the
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`egregiousness of the conduct. And those are separate factors
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`not for the jury to consider.
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`But there is a little bit of overlap here, I think,
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`with respect to two of those factors: Defendant's motivation
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`for harm, and whether Defendant attempted to conceal its
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`misconduct.
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`Let's just stick to one: Motivation for harm.
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`That's a Reed factor, not a willfulness factor under the case
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`law. But this is a pretty interesting marketing situation
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`here -- marketing and sales situation here in terms of the
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`lightbulbs themselves on many different levels, profitability
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`being one -- profitability and brand being one. And, at least
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`in my experience, when you're looking at intentional conduct,
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`motivation for that intentional conduct can be -- I'm not
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`saying it always is, but it can be of some relevance in
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`determining intent in the absence of -- particularly in the
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`absence of direct evidence of intent.
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`And so, looking ahead to "willfulness," as we move
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`into that evidence, I'm going to make every effort to keep that
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`evidence relevant as it's presented. And when the time
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`comes -- now is not the time -- but when the time comes, we're
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`going to have a very direct discussion about whether or not
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`profit motivation could be or is a fact that might be
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`considered in terms of -- in terms of willful intent.
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 10 of 217
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`It's a tough call. It's a close call. Most of the
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`cases I've read on willfulness address whether or not there was
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`a lawyer opinion and all those kinds of things that show both
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`knowledge and subsequent actions with respect to this.
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`But we're going to have to start narrowing this thing
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`down, because, I think yesterday, listening to the opening
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`statements -- and I'm not just directing this at the
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`Plaintiff -- I'm not happy about some of the things that came
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`up during that opening statement, but I'm also not happy by
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`some of the things that came up in defense opening statement.
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`Just to give you -- I'll go -- I'll say this to both
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`sides at this point:
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`From the Plaintiff's perspective, in terms of
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`predicting the evidence, I get it why you want to ingratiate
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`yourself with the jury as being the good guys wearing the white
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`hats. But there'll be no evidence presented during this trial
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`as to the background of the lawyers. Irrelevant. And that
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`door is open to -- well, I'm just going to say that's not going
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`to be evidence in the case.
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`And, similarly, there's going to be no evidence
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`presented that the judge dismissed a literal infringement
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`claim. The claim's gone. We're not going to revisit that.
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`Completely irrelevant. And so we're going to get back on
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`track.
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`We'll be in recess for five minutes, and bring the
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 11 of 217
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`jury in.
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`(At 9:36 a.m., break taken.)
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`(At 9:43 a.m., break concluded.)
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`(At 9:46 a.m., jurors arrive.)
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`THE COURT: All right. Ladies and gentlemen, good
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`morning. We will start with the evidence now.
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`And I suspect that either Ms. Simmons or
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`Ms. Stainback has told you about this, but we have this jury
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`room, and then the jury room across the hall will remain open
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`and accessible. There's snacks. There's restrooms in here.
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`There's restrooms out in the front lobby. And we stopped using
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`this deliberation room for a while because it was too small for
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`12 jurors.
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`You can use both. If you want to spread out, you can
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`spread out, if you want to stay back here, you all can decide
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`where you want to take your breaks. But both of them are
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`available to you throughout the course of the trial.
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`Mr. Brooks, OptoLum may call its first witness.
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`MR. BROOKS: Thank you, Your Honor.
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`Your Honor, OptoLum calls Joel Dry to the stand.
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`(Witness sworn by the clerk.)
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`THE COURT: All right. Mr. Dry, I want you to have a
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`seat. Get yourself where you're comfortable in the chair.
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`Then that microphone will slide around on that little top in
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`front of you. And just get it kind of set up so that when
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`October 26, 2021 - Trial Day 2
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`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 12 of 217
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`Dry - Direct
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`you're answering the question, you are speaking directly at the
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`microphone. If you need to move it around, you can.
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`THE WITNESS: Okay.
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`THE COURT: If you'll take your mask off.
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`Mr. Brooks, you may proceed.
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`MR. BROOKS: Thank you, Your Honor.
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`JOEL DRY,
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`PLAINTIFF'S WITNESS, SWORN AT 9:49 a.m.
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`DIRECT EXAMINATION
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`BY MR. BROOKS:
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`Q
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`Q
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`Good morning, Mr. Dry.
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`Good morning.
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`I guess I'd like to sort of start at the beginning a
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`little bit and have you, you know, describe your background,
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`beginning with your childhood and where you grew up.
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`Okay. I grew up on a ranch in a small town in west Texas,
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`cattle ranch. I -- pretty simple upbringing, cows, chores,
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`very small town of 3,000 people. We grew our own crops. We
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`fed the crops to the animals. And so I had a pretty simple
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`life as a child.
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`Q
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`How many cattle did you have?
`
`It ranged depending on the weather and drought and
`
`23
`
`whatnot, between 50 and 100 head.
`
`24
`
`25
`
`Q
`
`A
`
`Okay. How many acres was the ranch?
`
`It was about 215.
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 13 of 217
`
`Dry - Direct
`
` 13
`
` 1
`
`Q
`
`Okay. Did you have any chores to do growing up on a
`
` 2
`
`ranch?
`
` 3
`
`A
`
`Yeah. I had to -- I had to feed the animals when the
`
` 4
`
`grass wasn't enough to take care of them. I had to plow the
`
` 5
`
`fields, helping my father, of course, plow the fields, harvest
`
` 6
`
`the crops in some cases.
`
` 7
`
`Q
`
`And did you -- could you describe the workshop at the
`
` 8
`
`ranch, please.
`
` 9
`
`A
`
`Yeah. We had our own metal shop. We'd build our own
`
`10
`
`fence, and sometimes, there were steel parts to that that had
`
`11
`
`to be built. And sometimes, depending on seasonality and soil,
`
`12
`
`we'd make modifications to our plows and to our equipment.
`
`13
`
`14
`
`Q
`
`A
`
`Okay. And were there other animals on the ranch?
`
`There were. Horses, sheep, goats, pigs. A little bit of
`
`15
`
`everything.
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`Q
`
`A
`
`Q
`
`A
`
`Q
`
`A
`
`What was the name of the town in west Texas?
`
`Winters.
`
`And how big was it?
`
`3,000 people.
`
`Okay. And can you tell us anything about the town?
`
`It's a small agricultural and manufacturing town. So
`
`22
`
`there was a lot of cotton, oats, wheat grown there and a lot of
`
`23
`
`cattle ranching.
`
`24
`
`25
`
`Q
`
`A
`
`Is there a museum in town?
`
`There is.
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 14 of 217
`
`Dry - Direct
`
` 14
`
` 1
`
` 2
`
`Q
`
`A
`
`And what's that museum about?
`
`Well, they have a number of exhibits about the history of
`
` 3
`
`the town. For example, it used to be a very big cotton
`
` 4
`
`production area. And an earlier resident, before my lifetime,
`
` 5
`
`had developed an early cotton thresher that was pulled by a
`
` 6
`
`horse rather than people having to pick cotton and put it into
`
` 7
`
`a burlap sack and bring it in to the cotton gin, this machine
`
` 8
`
`would do it. That's an early childhood memory, and learning
`
` 9
`
`about that.
`
`10
`
`And then, over time, the gentleman who developed this
`
`11
`
`horse-drawn cotton thresher converted it into a steam engine
`
`12
`
`cotton thresher.
`
`13
`
`14
`
`15
`
`16
`
`17
`
`Q
`
`A
`
`Q
`
`A
`
`Q
`
`And was that active?
`
`It was, yes.
`
`And that's featured in the museum?
`
`It is.
`
`Could you explain a little more about the shop on your
`
`18
`
`farm? What sorts of machinery did it have in it?
`
`19
`
`A
`
`We had a metal machine shop, metal bending equipment. We
`
`20
`
`had our own wood shop. So we did a little bit of everything
`
`21
`
`ourselves. My dad had also owned a manufacturing business, so
`
`22
`
`he was a metal worker by trade.
`
`23
`
`Q
`
`You've mentioned earlier that the town had manufacturing
`
`24
`
`and had, obviously, farming. Did your dad have anything to do
`
`25
`
`with the manufacturing in town?
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 15 of 217
`
`Dry - Direct
`
` 15
`
` 1
`
`A
`
`Yeah. My dad, along with his brother and their father,
`
` 2
`
`had started a company that built a number of things, but they
`
` 3
`
`built vending machines. And this is in the 19 -- late 1940s,
`
` 4
`
`right after World War II, and into the '50s, and on through
`
` 5
`
`more recent times.
`
` 6
`
`But they built -- they switched over to air
`
` 7
`
`conditioning when that became viable. And they built, also,
`
` 8
`
`air conditioning vents and grills and registers. And they had
`
` 9
`
`a lot of -- well, I don't know about a lot. They had a few
`
`10
`
`patents in the field of air conditioning and air handling.
`
`11
`
`Q
`
`Okay. And I have to ask this question because we're in
`
`12
`
`North Carolina, but does any of your family come from North
`
`13
`
`Carolina originally?
`
`14
`
`A
`
`Yeah. My dad's dad moved from the Albemarle area to
`
`15
`
`Winters, Texas.
`
`16
`
`17
`
`18
`
`Q
`
`A
`
`Q
`
`And when was that?
`
`It was in the early 1900s, so it goes way back.
`
`Okay. You graduated from high school. Did you go to
`
`19
`
`college?
`
`20
`
`21
`
`22
`
`23
`
`24
`
`A
`
`Q
`
`A
`
`Q
`
`A
`
`Yes, I did.
`
`And where --
`
`I went to Texas A&M University.
`
`Okay. And what did you study there?
`
`I studied communications, and I got a minor in
`
`25
`
`architecture and a minor in business.
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 16 of 217
`
`Dry - Direct
`
` 16
`
` 1
`
`Q
`
`Okay. And then, I take it, when you graduated from
`
` 2
`
`college, you went to work?
`
` 3
`
`A
`
`I did. I worked a few different jobs trying to figure out
`
` 4
`
`exactly what I wanted to do and what I wanted to be in life.
`
` 5
`
`And I settled into the Black & Decker Architectural Hardware
`
` 6
`
`Division. And that's Kwikset doorknobs and door locks. And I
`
` 7
`
`was decent at that -- pretty good.
`
` 8
`
` 9
`
`10
`
`Q
`
`A
`
`Q
`
`Decent at what? What were you doing there?
`
`I was selling doorknobs and door locks to Home Depot.
`
`Okay. And did your performance on that job lead to any
`
`11
`
`other job offers?
`
`12
`
`A
`
`Yes. I got recruited by a company called Color Kinetics,
`
`13
`
`and I was hired to do outside sales in that company.
`
`14
`
`Q
`
`Okay. So the jury heard me say something about Color
`
`15
`
`Kinetics yesterday --
`
`16
`
`17
`
`A
`
`Q
`
`Yes.
`
`-- in the opening argument, but you know a lot more about
`
`18
`
`Color Kinetics than I do. So could you describe what the
`
`19
`
`business of Color Kinetics was, and also tell us where that was
`
`20
`
`located.
`
`21
`
`A
`
`Yes. Color Kinetics was headquartered in Boston, and they
`
`22
`
`were one of the earliest companies to take LEDs, light emitting
`
`23
`
`diodes, and build them into a light fixture or a lighting
`
`24
`
`system.
`
`25
`
`Q
`
`And what kind of fixture was that?
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 17 of 217
`
`Dry - Direct
`
` 17
`
` 1
`
`A
`
`Color changeable theatrical lighting type product. So
`
` 2
`
`they were geared toward lighting theaters, lighting restaurants
`
` 3
`
`or themed environments in some retail stores, facades of
`
` 4
`
`buildings, creating a memorable effect on a building with
`
` 5
`
`color.
`
` 6
`
` 7
`
`Q
`
`A
`
`What were you hired to do at Color Kinetics?
`
`I was hired to be the sales manager for the middle south
`
` 8
`
`of the United States as well as Latin America.
`
` 9
`
`10
`
`Q
`
`A
`
`Okay. What was your district in the middle south?
`
`I had Louisiana, Mississippi, Alabama, Arkansas, sometimes
`
`11
`
`I helped out in Texas, sometimes I helped out in Florida. And
`
`12
`
`then I took over Latin America as well.
`
`13
`
`Q
`
`Is that an ideal location to try and sell theatrical
`
`14
`
`lighting?
`
`15
`
`16
`
`17
`
`18
`
`A
`
`Q
`
`A
`
`Q
`
`No, which is why I took over Latin America.
`
`That was your idea?
`
`Yes.
`
`Let's go back to this colored light fixture that Color
`
`19
`
`Kinetics had designed. How was the color of light produced?
`
`20
`
`You mentioned LEDs, but could you be a little bit more
`
`21
`
`specific?
`
`22
`
`A
`
`So the way they did it, and they patented their
`
`23
`
`technology, they mixed red, green, and blue LEDs in varying
`
`24
`
`intensities, 512 steps in each color. And when you mix 512
`
`25
`
`steps of red, green, and blue, that allows 16.7 million
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 18 of 217
`
`Dry - Direct
`
` 1
`
`permutations.
`
` 18
`
` 2
`
` 3
`
` 4
`
` 5
`
`Q
`
`A
`
`Q
`
`A
`
`And how is that --
`
`So a wide variety of colors.
`
`Sorry, I interrupted. What were you saying?
`
`So you can generate a very wide variety of colors.
`
` 6
`
`Compared to the previous technology, which was a very powerful
`
` 7
`
`incandescent lightbulb with a colored filter put in front of
`
` 8
`
`it. And what that colored filter does is it -- say you put a
`
` 9
`
`red filter in front of a very bright light. It filters out
`
`10
`
`every part of the spectrum except for that color of red, which
`
`11
`
`cuts the light output by, say, 90 percent, so you get
`
`12
`
`10 percent of the original light, but in red.
`
`13
`
`That's the reason that the early LEDs were able to
`
`14
`
`compete in that market, because LEDs were quite dim in those
`
`15
`
`days, and they were able to create a product that was viable.
`
`16
`
`Q
`
`So you said that "these days," and I apologize, we haven't
`
`17
`
`set this in time yet. What's the -- I know you're not great
`
`18
`
`with dates, but what is the approximate time you were working
`
`19
`
`for Color Kinetics?
`
`20
`
`A
`
`That was '99 and 2000, and maybe into the beginning of
`
`21
`
`2001.
`
`22
`
`Q
`
`Okay. And you mentioned that the LEDs in the theatrical
`
`23
`
`device were not that bright; did I understand you to say that?
`
`24
`
`A
`
`That's correct; it wasn't that bright. But it was
`
`25
`
`sufficiently bright to compete with white light that was
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 19 of 217
`
`Dry - Direct
`
` 19
`
` 1
`
`filtered with a color that lost 90 percent of its output.
`
` 2
`
`Q
`
`And could you explain to the jury, if you know, just in
`
` 3
`
`layperson's terms, because I know you're not an expert, could
`
` 4
`
`you explain to them whether there's any correlation between the
`
` 5
`
`brightness of light and heat?
`
` 6
`
`A
`
`Yes. As an LED gets -- gets brighter, it also gets hotter
`
` 7
`
`in terms of one-for-one efficiency. Now, over time, LEDs have
`
` 8
`
`become more efficient, which means that the heat necessary to
`
` 9
`
`generate a certain amount of light has diminished over time.
`
`10
`
`Q
`
`So was thermal management a real concern with the
`
`11
`
`theatrical lighting devices at Color Kinetics?
`
`12
`
`A
`
`Not at the time, because the LEDs were low power LEDs, so
`
`13
`
`they drew very little wattage, and they were spread over a
`
`14
`
`circuit board that allowed them to have space to cool.
`
`15
`
`Q
`
`And how about the incandescents with the filters on them?
`
`16
`
`Did they run hot?
`
`17
`
`18
`
`A
`
`Q
`
`They did, yes.
`
`And was the fact that the LEDs ran cooler a factor in your
`
`19
`
`sales --
`
`20
`
`A
`
`That was one selling factor. Also, the manual labor
`
`21
`
`aspect of having someone in front of a screen or even having an
`
`22
`
`automated system that could change the color of the lights
`
`23
`
`immediately without having to have someone up in a -- up in a
`
`24
`
`top of a theater physically changing gels. It was a very
`
`25
`
`manual process before.
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 20 of 217
`
`Dry - Direct
`
` 20
`
` 1
`
`Q
`
`And was there a time that -- when did you leave Color
`
` 2
`
`Kinetics?
`
` 3
`
` 4
`
` 5
`
`A
`
`Q
`
`A
`
`It was early 2001.
`
`Okay. What were the circumstances of your leaving?
`
`The company missed its overall revenue goals, and every
`
` 6
`
`employee at my level was terminated due to business condition.
`
` 7
`
`Q
`
`Okay. And can you describe for the jury kind of what your
`
` 8
`
`thinking was about LEDs at the time you were working for Color
`
` 9
`
`Kinetics?
`
`10
`
`11
`
`12
`
`A
`
`Q
`
`A
`
`I was convinced that they were the future of lighting.
`
`And why?
`
`It's very much on the same line of computer chips. And at
`
`13
`
`that time, everyone had a good understanding that computer
`
`14
`
`chips were reflective of Moore's Law, which was a massive,
`
`15
`
`exponential improvement in computing powers, and it was
`
`16
`
`unknown. And semiconductors had replaced every vacuum tube in
`
`17
`
`the world with the exception of lightbulbs.
`
`18
`
`19
`
`Q
`
`A
`
`Okay. And how was that relevant to LEDs in your mind?
`
`LEDs are a semiconductor. Incandescent lightbulbs are a
`
`20
`
`vacuum tube. And it made complete, logical sense to me that
`
`21
`
`there was only one way the world was going to go.
`
`22
`
`23
`
`24
`
`Q
`
`A
`
`Q
`
`Okay.
`
`And I wanted to be a part of it.
`
`Okay. So let's talk a little bit about the formation of
`
`25
`
`OptoLum. Do you recall approximately when OptoLum was formed?
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 21 of 217
`
`Dry - Direct
`
` 21
`
` 1
`
` 2
`
`A
`
`Q
`
`Yeah, it was late in 2001.
`
`Okay. And there's also -- the jury saw a document
`
` 3
`
`yesterday, which we'll get to in a minute, that referred to G&B
`
` 4
`
`Lighting -- property of G&B Lighting in the lower right-hand
`
` 5
`
`corner.
`
` 6
`
` 7
`
` 8
`
`A
`
`Q
`
`A
`
`Yes.
`
`What's G&B Lighting?
`
`It was a reference to my original founding partner and
`
` 9
`
`myself, G&B.
`
`10
`
`11
`
`12
`
`13
`
`Q
`
`A
`
`Q
`
`A
`
`Okay.
`
`I was G, and Javier was B.
`
`And who is Javier?
`
`Javier Gonzalez was my good friend in Mexico City. He
`
`14
`
`owned a company that was my distributor for Color Kinetics
`
`15
`
`throughout Latin America.
`
`16
`
`17
`
`Q
`
`A
`
`Okay. And when --
`
`He and I had become friends over the course of our
`
`18
`
`business relationship.
`
`19
`
`20
`
`Q
`
`A
`
`So is G&B Lighting a predecessor company to OptoLum?
`
`G&B Lighting is OptoLum. We did a formal name change of
`
`21
`
`the corporation.
`
`22
`
`23
`
`Q
`
`A
`
`I see. And who else did you form --
`
`G&B was a placeholder name while we were -- we weren't
`
`24
`
`sure what we were going to call the company, so we formed the
`
`25
`
`corporation, and made up a name until we knew what we wanted to
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 22 of 217
`
`Dry - Direct
`
` 1
`
`call ourselves.
`
` 22
`
` 2
`
`Q
`
`Is there any meaning to the term "OptoLum," why you chose
`
` 3
`
`that term?
`
` 4
`
`A
`
`It's a convergence of the opto electronics and the
`
` 5
`
`illumination fields.
`
` 6
`
`Q
`
`Okay. And the jury also learned yesterday that Ms. Baker
`
` 7
`
`was one of the founders of OptoLum as well?
`
` 8
`
` 9
`
`10
`
`A
`
`Q
`
`A
`
`Yes.
`
`Can you -- can you -- when did she get involved?
`
`Sometime in 2001. I was dating her daughter, and at one
`
`11
`
`point, her daughter, who's now my wife, took me home to meet
`
`12
`
`her mom. And I was talking about what I was working on. And
`
`13
`
`over time, she grew intrigued by it and expressed an interest
`
`14
`
`in being involved.
`
`15
`
`16
`
`Q
`
`A
`
`Was she initially sold on the idea?
`
`I don't know. It seems like it happened relatively
`
`17
`
`quickly, and I wasn't really trying to sell her on the idea.
`
`18
`
`19
`
`Q
`
`A
`
`What were you trying to do?
`
`I was trying to impress my girlfriend's mother because I
`
`20
`
`really cared for Martha, and I had the sense that I wanted to
`
`21
`
`marry her.
`
`22
`
`Q
`
`And you've been in business with your mother-in-law for
`
`23
`
`the last 20 years, is that correct?
`
`24
`
`25
`
`A
`
`Q
`
`I have, yes.
`
`Okay. And I'm sorry. What was Ms. Baker's background?
`
`October 26, 2021 - Trial Day 2
`
`

`

`Case 1:17-cv-00687-WO-JLW Document 375 Filed 08/09/22 Page 23 of 217
`
`Dry - Direct
`
` 23
`
` 1
`
`A
`
`Ms. Baker had been involved in other companies, startup
`
` 2
`
`companies, so she had -- she had some experience in operating a
`
` 3
`
`small business that I didn't have, so it seemed like a natural
`
` 4
`
`fit.
`
` 5
`
`Q
`
`How did you get the company started? What did you do
`
` 6
`
`about funding it, first?
`
` 7
`
`A
`
`Well, we -- Karen, Javier, and myself, we

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