Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 1 of 10
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF PENNSYLVANIA
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`14cv0111
`ELECTRONICALLY FILED
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`DRONE TECHNOLOGIES, INC.,
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`Plaintiff,
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`v.
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`PARROT S.A., PARROT, INC.,
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`Defendants.
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`ORDER OF COURT RE: PARTIES’ MOTIONS IN LIMINE
`(DOC. NOS. 236-242, 244, 246, 248, 250, 252, 254, AND 256)
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`Presently before this Court are Motions in Limine filed by the Parties, in advance of the
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`upcoming jury trial, which is scheduled to begin on April 27, 2015. Doc. Nos. 236-242, 244,
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`246, 248, 250, 252, 254, and 256. The issues contained within these Motions have been fully
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`briefed and are ripe for disposition. Doc. Nos. 236-241, 243, 245, 247, 249, 251, 253, 255, 257,
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`264-271, 274-280. After consideration of these matters, the following Order is entered.
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`AND NOW, this 9th day of April, 2015, IT IS HEREBY ORDERED THAT:
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`1. Plaintiff’s Motion in Limine Precluding Defendants from Arguing Before the Jury
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`Inventorship, Validity, or Ownership (Doc. No. 236) is GRANTED. As noted by both
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`Plaintiff and Defendants, the upcoming jury trial will focus on damages and the amount
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`of any award. Plaintiff moves this Court to preclude Defendants from presenting
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`arguments as to alleged deficiencies in Diane Lee’s inventorship or the validity or
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`ownership of the underlying patents. In response, Defendants explicitly state that they do
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`not “intend to argue these legal issues in front of the jury,” but move the Court to permit
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`them to cross-examine witnesses on these points so as to challenge the witnesses’
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`credibility. Doc. No. 274, pg. 1. Such cross-examination would not produce any relevant
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 2 of 10
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`testimony or evidence because the validity of the underlying patents, including
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`inventorship, has previously been determined and will not be at issue during the damages
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`trial. The Court encourages the Parties to stipulate that inventorship and the validity of
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`the patents have been established to further limit any need for such testimony.
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`2. Plaintiff’s Motion in Limine Precluding Defendants From Presenting Evidence or
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`Arguing Before the Jury Their Allegations of Bruce Ding’s Relationship With His
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`Former Employer (Doc. No. 237) is GRANTED IN PART. Plaintiff, in this Motion,
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`moves this Court to prohibit Defendants from presenting evidence or argument as to
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`Bruce Ding’s relationship with his former employer. The substance of disputed evidence
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`at issue in Plaintiff’s Motion is two-fold: (1) Ding’s work on remotely-controlled toys
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`while employed by a non-party former employer; and (2) the circumstances of Ding’s
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`termination from that employment and Ding’s subsequent characterization of that
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`termination.
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`First, the substance and parameters of Ding’s work at his former employer does
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`not tend to make any consequential fact more or less likely to be true because Ding’s
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`prior work is not relevant to the current damages claims. As demonstrated by
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`Defendants’ previous Motions related to Ding’s alleged invention of the patents-in-suit,
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`the proffered disputed evidence has been used to argue that Plaintiff lacks standing and,
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`therefore, Defendants cannot be held liable for infringement. See Doc. Nos. 97, 172,
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`188, 229. However, these disputes have been resolved by this Court and thus, the
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`evidence is not admissible during this limited damages trial because it is not relevant.
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`Fed.R.Evid. 401-402.
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 3 of 10
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`Secondly, Defendants may not inquire into Ding’s termination because it also is
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`not relevant. Fed.R.Evid. 401-402. However, if Defendants believe Plaintiff’s
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`presentation of evidence makes Ding’s alleged untruthfulness in regards to his
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`termination relevant on direct-examination, Defendants may re-raise this issue at side-
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`bar, pursuant to Federal Rule of Evidence 608. The Court notes that it is generally
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`disinclined to admit evidence if it merely suggests that a witness has engaged in dishonest
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`behavior on a separate occasion. However, if Defendants re-raise this issue, the Court
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`will examine whether such cross-examination is proper pursuant to Rule 608 and Rule
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`403.
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`3. Plaintiff’s Motion in Limine Precluding Defendants from Presenting Evidence or
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`Argument Before the Jury Regarding the Inter Partes Review Proceedings Pending
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`Before the Patent Office (Doc. No. 238) is GRANTED. Plaintiff moves this Court to bar
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`Defendants from presenting evidence or argument regarding the inter partes review
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`proceedings pending before the United States Patent and Trademark Office, or any
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`invalidity arguments based upon prior art, or offering exhibits related to the inter partes
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`review. Plaintiff states that this information is not probative of any damages issue and
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`would be confusing to the jury and highly prejudicial to Plaintiff. Defendants argue that
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`the inter partes review is relevant to a determination of damages and will be used for “the
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`limited purpose of showing that whatever differences there are between the prior art and
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`the claimed invention, they are not extensive.” Doc. No. 275, pg. 2.
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`As noted by Plaintiff, the calculation of a reasonable royalty is premised on the
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`assumption that the patents are valid and infringed. Lucent Techs., Inc. v. Gateway, Inc.,
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`580 F.3d 1301, 1325 (Fed. Cir. 2009). Defendants previously moved this Court to stay
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 4 of 10
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`the case pending inter partes review, which Defendants noted “is an adversarial
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`proceeding in the United States Patent and Trademark Office (“PTO”) through which a
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`party other than the patentee can seek invalidation of patent claims under 35 U.S.C. §§
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`102 or 103.” Doc. No. 18, pg. 8. The Court finds that introduction of the incomplete
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`inter partes review proceedings presents a substantial danger that the evidence would be
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`confusing to the jury and unduly prejudice Plaintiff. Introduction of such evidence or
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`argument would be highly prejudicial to Plaintiff because the jury would be presented
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`with the opportunity to transfer the findings within the inter partes review proceedings,
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`which are based upon a more lenient standard than that employed by a District Court or a
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`jury, onto a determination of damages. Further, there is a substantial risk that the jury
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`would be confused by the effect of inter partes review proceedings and could potentially
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`credit the findings of the Patent Trial and Appeals Board merely because of the perceived
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`credibility of government agencies over a foreign corporate Plaintiff. This is especially
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`true as the Patent Trial and Appeal Board has granted more than 80% of the requests for
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`inter partes review. See Doc. No. 18, pg. 9. Defendants may rebut Plaintiff’s
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`contentions of the utility and advantages of the patent property over the old modes or
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`devices (factor 9 of the Georgia-Pacific factors) through evidence other than the inter
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`partes review, if this becomes relevant during trial.
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`4. Plaintiff’s Motion in Limine Precluding Defendants from Presenting Evidence or
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`Argument Before the Jury Regarding Infringement (Doc. No. 239) is DENIED AS
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`PREMATURE. Plaintiff moves this Court to prohibit Defendants from presenting
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`evidence or argument regarding Defendants’ “use or non-use of the patented inventions”
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`or the advantages of the patented inventions over prior art because Defendants have
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 5 of 10
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`allegedly not produced sufficient discovery in this respect to permit Plaintiff to present
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`argument or evidence to rebut Defendants’ contentions. Defendants shall file a document
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`relating which defense exhibits will be used in reference to factors 9 and 11 of the
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`Georgia-Pacific factors on or before April 13, 2015. Plaintiff may file a renewed Motion
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`in Limine in this respect, if appropriate, based upon Defendants’ identified exhibits.
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`5. Plaintiff’s Motion in Limine Precluding Defendants’ Damages Expert from Offering an
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`Opinion on Damages for Infringement Occurring Beyond June 2015 (Doc. No. 240) is
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`GRANTED WITHOUT OBJECTION. Plaintiff moves this Court to order that
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`Defendants’ damages expert is prohibited from offering an opinion during trial on the
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`subject of damages for infringement occurring beyond June 2015. Defendants do not
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`object to this limitation because they contend that determination of future infringement
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`damages is an issue for the Court to determine after the trial’s conclusion. Therefore,
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`Defendants’ damages expert is precluded from offering an opinion during trial on the
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`subject of damages for infringement occurring beyond June 2015.
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`6. Plaintiff’s Motion in Limine Precluding Defendants from Offering Exhibits that They
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`Did Not Produce Until After the Court-Imposed Deadline (Doc. No. 241) is DENIED.
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`In this Motion, Plaintiff moves this Court to exclude 61 exhibits, which Defendants
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`produced after the Court-ordered February 4, 2015 deadline for production of documents.
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`Defendants have advanced sufficient arguments such that the Court cannot conclude that
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`these exhibits are precluded by the Court’s prior Orders. Therefore, Plaintiff’s Motion
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`must be denied.
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`7. Defendants’ Motion in Limine Regarding Sanctions (Doc. No. 242) and Motion in
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`Limine Regarding Discovery Motions, Orders, and Events (Doc. No. 244) are
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 6 of 10
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`GRANTED IN PART AND DENIED IN PART. Defendants move this Court to
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`exclude any statement, evidence, or argument relating to sanctions imposed against them
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`and the underlying procedural posture, pursuant to Federal Rules of Evidence 401, 402,
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`and 403. Defendants further request that the Court impose sanctions against Plaintiff for
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`any violation if the Motions are granted. The Court has endeavored to focus the Parties
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`solely on issues relevant to damages. At this stage, Defendants’ actions in this litigation
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`and the case’s unprecedented procedural posture are not relevant to Plaintiff’s entitlement
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`to damages and introduction of evidence related to Defendants’ litigation tactics and the
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`Court’s prior Orders would be highly prejudicial to Defendants. Therefore, Defendants’
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`Motion in Limine is granted to the extent that Defendants move this Court to preclude
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`Plaintiff from introducing evidence or argument as to this Court’s sanctions or the
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`Parties’ previous litigation actions. As with all violations of Court Orders, violation of
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`this Order may subject a Party to sanctions. The Court denies Defendants’ Motions to the
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`extent that they move this Court to find that violation of this Order will necessitate
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`sanctions.
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`8. Defendants’ Motion in Limine Regarding any Parrot Product Not Identified in the
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`Complaint as an Accused Product (Doc. No. 246) is DENIED. On November 3, 2014,
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`the Court entered default judgment against Defendants “as to liability” based upon their
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`unprecedented refusal to comply with this Court’s Orders. Doc. No. 107. In advance of
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`the upcoming damages jury trial, Defendants move this Court to order that Plaintiff may
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`not introduce evidence as to or reference products other than those specifically identified
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`in Plaintiff’s Complaint (Minidrones and Bebop) because these other products are not
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`subject to the default judgment and information thereon is irrelevant and, therefore,
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 7 of 10
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`inadmissible. Alternatively, Defendants contend that introducing evidence of these
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`products and other confidential Parrot research and development products creates an
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`unfair risk of prejudice. Fed.R.Evid. 403.
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`The Court has ruled on liability and Defendants’ infringement is no longer a
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`viable issue. Defendants’ Motion, based upon the Court’s previous rulings, is denied
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`based upon the grounds previously and repeatedly set forth by this Court. Further, even
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`assuming that liability was still at issue, Defendant’s Motion is denied because
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`Defendants have not demonstrated that the relevance of Defendants’ Minidrones and
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`Bebop products is substantially outweighed by any of the factors identified in Federal
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`Rule of Evidence 403.
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`9. Defendants’ Motion in Limine Regarding any Purported Acts of Direct Infringement Not
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`Identified During Discovery and Plaintiff’s Royalty Base (Doc. No. 248) is DENIED.
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`Defendants move this Court to bar Plaintiff from making any statement or argument or
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`presenting evidence regarding any purported acts of direct infringement not identified
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`during discovery or regarding Plaintiff’s royalty base. This issue was previously raised
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`by Defendants in their Motion for Partial Summary Judgment, which the Court denied.
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`Doc. Nos. 210, 228. The Court incorporates its prior reasoning in denying this motion
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`and reiterates that there is sufficient evidence to support Plaintiff’s damages claim based
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`upon the current record.
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`10. Defendants’ Motion in Limine Regarding Damages Prior to January 4, 2013 (Doc. No.
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`250) is DENIED. Defendants move this Court to preclude any statement, evidence, or
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`argument relating to damages based on sales or other information prior to January 4,
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`2013 and preclude Plaintiff’s expert Ned Barnes because he identified an “incorrect” date
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 8 of 10
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`of first infringement. Defendants contend that January 4, 2013, is the date Defendants
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`first learned of the patents-in-suit and, therefore, this is the date of first infringement.
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`Barnes, Plaintiff’s expert, calculated damages beginning on January 31, 2012, the date
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`that the ‘748 patent-in-suit issued. Doc. No. 186, pg. 4. As noted by Plaintiff,
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`Defendants’ expert, John C. Jarosz, also uses January 31, 2012, as the date of first
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`infringement. Doc. Nos. 197, 199. On April 7, 2015, Defendants filed a separate Motion
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`seeking leave to file a supplemental damages report, in which Jarosz will “correct” his
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`“mistaken assumption” and revise his calculations using January 4, 2013 as the starting
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`date. Doc. No. 282. Defendants have not presented sufficient support for their requested
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`relief, which would disturb the initial consensus from the Parties that infringement began
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`on January 31, 2012. There is also no reason to find that the evidence is inadmissible or
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`to exclude such evidence based upon Federal Rules of Evidence 401, 402, or 403 or 702.
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`11. Defendants’ Motion in Limine Regarding a Confidential Parrot and Subsidiary
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`Agreement (Doc. No. 252) is DENIED. In this Motion, Defendants move the Court to
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`exclude all argument or evidence, including expert testimony, as to a confidential license
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`agreement between Parrot S.A. and a non-party wholly-owned subsidiary because the
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`licenses are not sufficiently comparable to the patents-in-suit so as to be relied upon for
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`the purposes of the hypothetical negotiation. After review of the objected-to information,
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`the Court finds that the information is relevant to the jury’s determination of damages and
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`its relevance is not substantially outweighed by the risk of any factor identified in Federal
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`Rule of Evidence 403. Fed.R. Evid. 401-403.
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`12. Defendants’ Motion in Limine Regarding Parrot’s Patented Products and/or Patent
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`Marking (Doc. No. 254) is GRANTED. Defendants’ Motion is based upon Plaintiff’s
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 9 of 10
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`Counsel’s questioning of Defendants’ technical expert and anticipated similar questions
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`during trial as to a January 2012 press release. In this release, Defendants’ AR.Drone.2.0
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`was described as “patented,” even though a patent had not been issued for the product. In
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`this Motion, Defendants seek an Order precluding Plaintiff from introducing any
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`evidence or making reference to Defendants’ advertisement of products being patented
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`prior to a patent having issued and/or Defendants’ patent marketing practices, pursuant to
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`Federal Rules of Evidence 401-403. Defendants’ contend that the evidence is not
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`admissible at trial because such information is allegedly both irrelevant and if relevant,
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`the relevance is substantially outweighed by undue prejudice and should be excluded.
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`The Court finds that Defendants’ false inclusion of the term “patented” as to the
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`AR.Drone 2.0 is relevant because it has a tendency to make a fact more or less probable
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`than it would be without the evidence (i.e. that Defendants’ knew the importance and
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`value of the technology at issue). Fed.R.Evid. 401. However, the relevance of this
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`evidence is substantially outweighed by the risk of unfair prejudice to Defendants and the
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`risk that the jury will confuse the issues. Fed.R.Evid. 403. Presentation of this evidence
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`is not key to Plaintiff’s claim for damages because Plaintiff can demonstrate Defendants’
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`perceived value in the technology in other manners (including a redacted version of the
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`press release). However, if evidence is introduced that Defendants falsely touted a
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`product as patented, such evidence would potentially cause the jury to become
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`unmovably prejudiced against Defendants. Therefore, the limited relevance of the
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`disputed evidence is outweighed by unfair prejudice and risk of confusion and the
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`evidence shall be excluded pursuant to Federal Rule of Evidence 403.
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`Case 2:14-cv-00111-AJS Document 287 Filed 04/09/15 Page 10 of 10
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`13. Defendants’ Motion in Limine Regarding Settlement Discussions with “Diane Lee”
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`(Doc. No. 256) is DENIED. Defendants move this Court to exclude any reference to
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`Defendants’ “settlement” negotiations with the patent’s inventor, Diane Lee, in March
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`and April of 2013, pursuant to Federal Rules of Evidence 408(a) and 401-403. The
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`negotiations at issue occurred pursuant to Apple’s conflict resolution policy after Apple
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`removed Defendants’ application from the iTunes store because Diane Lee accused
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`Defendants of infringing her patents. The Court agrees with Plaintiff and finds that the
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`negotiations between Defendants and Lee in 2013 are more akin to licensing negotiations
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`than settlement discussions because there was no “disputed claims” as defined in Rule
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`408 and the Plaintiff corporation did not exist at the time of these interactions. While
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`mindful of the need to encourage settlement as a public policy by protecting the
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`confidentiality of such negotiations, in this case, Defendants’ positions when negotiating
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`with Lee are relevant to Plaintiff’s damages claims and the relevance of this evidence is
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`not substantially outweighed by the risk of any factor identified in Federal Rule of
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`Evidence 403.
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`14. The trial will proceed in accordance with these rulings.
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`s/ Arthur J. Schwab
`Arthur J. Schwab
`United States District Judge
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`cc:
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`All Registered ECF Counsel and Parties
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