Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 1 of 13
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`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`WACO DIVISION
`
`FLYPSI, INC., (D/B/A FLYP),
`
`
`
`§
`§
`§
`§
`§
`§
`§
`§
`§
`§
`
`
`DEFENDANT GOOGLE LLC’S REPLY IN SUPPORT OF ITS MOTION TO EXCLUDE
`OPINIONS OF MR. JUSTIN LEWIS
`
`
`
`
`v.
`
`GOOGLE LLC,
`
`CIVIL ACTION NO. 6:22-cv-00031-ADA
`
`JURY TRIAL DEMANDED
`
`Plaintiff,
`
`Defendant.
`
`
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`

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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 2 of 13
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`TABLE OF CONTENTS
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`
`Page
`INTRODUCTION ............................................................................................................. 1
`ARGUMENT ..................................................................................................................... 1
`A.
`Mr. Lewis Improperly Factors in
` in Unrelated
`Advertisement Revenue ......................................................................................... 1
`Mr. Lewis’s Apportionment Methodology Is Unfounded and Incomplete ........... 4
`1.
`Mr. Lewis’s Apportionment Steps Before and After His Flawed
`Feature Apportionment Step Render His Entire Apportionment
`Analysis Unreliable .................................................................................... 4
`Dr. Nettles Did Not Perform an Incremental Benefit Analysis ................. 6
`Google’s Criticism of Mr. Lewis’s Apportionment Methodology Is
`Not a Factual Dispute................................................................................. 8
`CONCLUSION .................................................................................................................. 8
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`2.
`3.
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`B.
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`I.
`II.
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`III.
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`-i-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 3 of 13
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`TABLE OF AUTHORITIES
`
`
`Page(s)
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`Cases
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`Ericsson v. D-Link Sys., Inc.,
`773 F.3d 1201 (Fed. Cir. 2014)..........................................................................................3, 7, 8
`
`Kewazinga Corp. v. Google LLC,
`No. 20-cv-1106-LGS, 2023 WL 6308420 (S.D.N.Y. Sept. 28, 2023) ......................................3
`
`LaserDynamics, Inc. v. Quanta Comput., Inc.,
`694 F.3d 51 (Fed. Cir. 2012)......................................................................................................3
`
`Realtime Data, LLC v. Actian Corp.,
`No. 6:15-cv-463 RWS-JDL, 2017 WL 11661896 (E.D. Tex. Mar. 24, 2017) ......................6, 7
`
`VirnetX, Inc. v. Cisco Sys., Inc.,
`767 F.3d 1308 (Fed. Cir. 2014)..................................................................................................8
`
`
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`-ii-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 4 of 13
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`I.
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`INTRODUCTION
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`Flyp’s damages expert, Justin Lewis, relies on irrelevant facts and deficient analysis in an
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`effort to unfairly inflate his damages calculations against Google. First, Mr. Lewis cites to
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`Google’s advertising revenue although he admits he knows of no connection between Google’s
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`advertising business and the accused Google Voice product. He does so solely to augment his
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`damages number and suggest that the augmented number is reasonable compared to Google’s
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`advertising revenue. Second, Mr. Lewis does not apportion for the incremental benefit attributable
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`to the Asserted Patents at his feature apportionment step. Instead, he improperly attributes the
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`entire value of basic features such as
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`to the Asserted Patents. Flyp
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`claims that Google ignores Mr. Lewis’s other apportionment steps, but those steps do not remedy
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`the faulty feature apportionment. The Court should exclude these improper opinions and any
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`opinions stemming therefrom.
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`II.
`
`ARGUMENT
`A. Mr. Lewis Improperly Factors in
`Advertisement Revenue
`
` in Unrelated
`
`Mr. Lewis admits that he has no evidence that Google Voice displays advertisements or
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`generates advertising revenue, directly or indirectly. Dkt. 178-2 at 123:24–124:19. Yet, Mr. Lewis
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`relies on Google’s advertising revenue in two ways. First, he uses it to justify a
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`per user-month
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`starting point in setting a royalty rate for users of the free version of Google Voice (Consumer
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`Voice). Dkt. 154-3 at 49. Second, he uses it to justify an undefined “upward” impact on the
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`hypothetical negotiation rate under Georgia-Pacific factor six. That analysis yields his ultimate
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`conclusion in Georgia-Pacific factor 15 after considering three quantitative rate indicators: (1) the
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` market approach, (2) the income analysis from Google’s perspective, (3) and the income
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`analysis from Flyp’s perspective. Id. at 63–76, 93–96.
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`-1-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 5 of 13
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`Flyp admits that Mr. Lewis uses Google’s advertising revenue to support the|| starting
`point in his Google perspective analysis. Specifically, Mr. Lewis uses hisPMstarting point fora//
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`users of Google Voice, including both Enterprise Voice users (who pay a monthly license fee) and
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`ConsumerVoice users (who indisputably do not pay a monthly license fee). Dkt. 154-3 at 49. Mr.
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`Lewisjustifies the PMstarting point for ConsumerVoice users, who admittedly pay no monthly
`fe, by claiminght
`po Id. at 9-14. Flyp admits that Mr. Lewis relies on this argumentto justify the
`MMstarting point for Consumer Voice. Opp. at 7. But, Flyp and Mr. Lewis have noevidence to
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`support Mr. Lewis’s asserted connection between Google’s advertising revenue and Google Voice.
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`Flyp had months of discovery to identify any financial and other benefits Google derives
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`from Google Voice, yet Mr. Lewis relies on nothing more than speculation to link Google Voice
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`to any Google advertising revenue. Flyp citesPe
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`BEE0) 15 (bs. 178.5), Bo, isdoc
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`also Ex. 16 at 38:12—40:12i. Noneof the documents Flyp cites show
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`any connection between Google Voice and advertising revenue (or any other indirect revenue
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`source). And Mr. Lewis admits that he finds no evidence of any such connection in thef|
`depositions taken of Google employees, which includeda. Dkt. 154-4 at 123:21-
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`124:19: Opp.at 5-6.!
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`misquotes a Google document
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`. Specifically, Flyp’s Opposition quotes the document as
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`-2-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 6 of 13
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`Flyp’s efforts to distinguish Kewazinga Corp. v. Google LLC, No. 20-cv-1106-LGS, 2023
`
`WL 6308420 (S.D.N.Y. Sept. 28, 2023) miss the mark. The issue in Kewazinga was not whether
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`the expert’s methodology was quantitative or qualitative, or whether the methodology started with
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`a royalty base of advertising revenue. Rather, the issue was that the damages expert “offer[ed] no
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`basis to conclude that her methodology accurately reflect[ed] th[e] value” of the accused product
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`to the ecosystem (and ultimately Google’s advertising revenue). Jd. at *3. Here, Mr. Lewis admits
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`he has no evidence that Google Voice contributes to Google’s advertising revenue, and thus has
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`no basis to include Google’s advertising revenue in his calculations. Dkt. 178-2 at 124:16—-19 (“I
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`wasn’t able to confirm orto test for those benefits.”); see LaserDynamics, Inc. v. Quanta Comput.,
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`Inc., 694 F.3d 51, 67 (Fed. Cir. 2012) (noting that a damages theory must be based on sound
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`economic and factual predicates).
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`Flyp dismisses Ericsson v. D-Link Systems, Inc., 773 F.3d 1201 (Fed. Cir. 2014), by
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`distinguishing immaterial facts related to the admissibility of agreements. The proposition for
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`which Google cited Ericsson remains unrefuted: a damages expert may use quantitative or
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`qualitative methodologies, but “[t]he essential requirementis that the ultimate reasonable royalty
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`award must be based on the incremental value that the patented invention addsto the end product.”
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`Id. at 1226. Mr. Lewisdid not, and can not, quantify how muchadvertising revenue1s attributable
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`to Google Voice, because the evidence establishes that there is no connection between the two.
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`Instead, he applied an amorphous and ungrounded “upward” impact on his royalty range in
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`Georgia-Pacific factor 6 despite having no evidence that the claimed features affect advertising
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`revenueatall.
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`| (Opp. at4), though the documentactually statesPe
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`-3-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 7 of 13
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`Introducing Google’s advertising revenue into the case with no connection to the accused
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`product would skew the damages horizon and prejudice the jury by posting
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` advertising
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`revenue numbers with which Mr. Lewis’s ultimate damages number may superficially appear
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`reasonable by comparison. Mr. Lewis admits that he has no evidence that Google Voice drives
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`advertising, directly or indirectly, and his opinions related to Google’s advertising revenue should
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`be excluded.2
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`B. Mr. Lewis’s Apportionment Methodology Is Unfounded and Incomplete
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`Flyp raises three arguments in an attempt to save Mr. Lewis’s flawed apportionment
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`analysis, which applies to his income analyses from both Google’s and Flyp’s perspectives. None
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`of these succeed.
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`1.
`
`Mr. Lewis’s Apportionment Steps Before and After His Flawed
`Feature Apportionment Step Render His Entire Apportionment
`Analysis Unreliable
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`Flyp distracts from Mr. Lewis’s deficient feature apportionment analysis by pointing to
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`three other quantitative and one other qualitative apportionment steps he performed. But Mr. Lewis
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`failed to properly apportion at a fourth quantitative step––specifically, step three of his quantitative
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`apportionment where he allegedly apportioned for relevant calling features. Mr. Lewis’s other
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`apportionment steps cannot remedy this failure.
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`Flyp does not dispute that step three of Mr. Lewis’s quantitative apportionment analysis
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`merely identifies
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` supposedly relevant calling features out of
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` alleged total features in
`
`
`2 Flyp claims that Mr. Lewis “does not incorporate any advertising revenue into his royalty base
`or royalty range.” Opp. at 1. Yet, Flyp admits that Mr. Lewis relies on advertising revenue to
`support his (1)
`starting point for his Google’s perspective income approach (Opp. at 7), and
`(2) ultimate royalty range when considering his three quantitative rate indicators in Georgia-
`Pacific factor 15 (Opp. at 6). If Mr. Lewis’s opinions do not rely on Google’s advertising business,
`as Flyp contends, then any discussion of Google’s advertising business or revenue should be
`excluded from presentation at trial.
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`-4-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 8 of 13
`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 8 of 13
`ee
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`Google Voice, and then simply dividesP| to arrive at an apportionmentofBRopp. at
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`a. Nor does Flyp dispute that at step three, Mr. Lewis ascribes 100% of the value from
`each of the || supposedly relevant calling features to the Asserted Patents. But Flyp cannot
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`justify ascribing 100% ofthe value of those features to the Asserted Patents when even Mr. Lewis
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`admits that many of them existed in prior, unaccused versions of Google Voice. Dkt. 154-4 at
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`152:3-11.
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`Flyp asks the Court to ignore Mr. Lewis’s fundamental failure at step three on the basis
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`that he performed other apportionment steps. But the other apportionment steps address separate
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`and distinct apportionment problems and cannot correct for his error at step three with respect to
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`thefj features. As Flyp acknowledges, Mr. Lewis’s step one apportions for SMStext messaging
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`unrelated to the Asserted Patents (which relate to calling), and his step two apportions for costs
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`unrelated to the Asserted Patents. Opp. at 9. Neither of these steps addresses incremental value
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`addedby the Asserted Patents to| supposedly relevantcalling features.
`Flyp characterizes Mr. Lewis’s step four as an additional apportionmentrelated to thefll
`features, but step four does not address the incremental value added to the a features by the
`Asserted Patents. Instead, that step is based onee
`
`Exhibit 4.0.2; Dkt. 178-8 at 5829. OfMMthat Mr. Lewis sums to reach his
`
`ES 0.3 ved in sep vecTT
`BEES5050002
`ee whichhas no connection with the ma features
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`

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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 9 of 13
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`relied on in step three. Dkt. 154-3 at 55; Dkt. 178-8 at 5829. Ultimately, Mr. Lewis uses
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`
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`at step four to weigh the value of desired feature improvements, but his analysis does not determine
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`the incremental value added to the
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` features by the Asserted Patents.
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`Mr. Lewis’s funnel approach to apportionment as depicted in his Exhibit 4.0 clearly
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`demonstrates how each of his four quantitative apportionment steps directly rely on each other,
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`and that error in one step necessarily affects each step after it, including the final result. Flyp admits
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`that Mr. Lewis starts with a “Value per User Month” of
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` and reduces that
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` by a percentage
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`allegedly attributable to the Asserted Patents at each apportionment step. Applying a flawed
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`percentage at any of those steps necessarily renders unreliable the final result of Mr. Lewis’s
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`quantitative apportionment. As such, any qualitative analysis Mr. Lewis performs in Georgia-
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`Pacific factors 9, 10, and 13 on this flawed quantitative output is also unreliable. Realtime Data,
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`LLC v. Actian Corp., No. 6:15-cv-463 RWS-JDL, 2017 WL 11661896, at *4 (E.D. Tex. Mar. 24,
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`2017) (noting that a party cannot “evade questions regarding how it calculated the ultimate value
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`attributable to the infringing features by pointing to the [Georgia-Pacific] analysis performed by
`
`the damages expert”).
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`2.
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`Dr. Nettles Did Not Perform an Incremental Benefit Analysis
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`Flyp suggests that Dr. Nettles performed the missing apportionment analysis in step three,
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`and that Google’s dispute centers on his analysis. But this motion does not challenge the propriety
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`of the analysis performed by Dr. Nettles or Mr. Lewis’s reliance on that analysis. Google’s
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`complaint is that neither Mr. Lewis nor Dr. Nettles, nor any other expert properly analyzed the
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`incremental benefit of each of the
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` identified features attributable to the Asserted Patents.3
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`
` features
`3 Flyp suggests that Google’s argument is merely a factual dispute over whether all
`were related to the Asserted Patents. Opp. at n. 2. Not so. This motion does not challenge the
`identification of
` features by either Dr. Nettles or Mr. Lewis. Rather, this motion challenges
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`-6-
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`

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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 10 of 13
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`After Dr. Nettles informed Mr. Lewis that
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` of
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` features “are related to or impacted
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`by” the Asserted Patents, Mr. Lewis was required to assess the incremental benefit of each of those
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`features attributable to the Asserted Patents. Dkt. 154-3 at 54. But Mr. Lewis did not do so. Nor
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`did he rely on any of Flyp’s technical experts for that analysis. In fact, Dr. Nettles admits that he
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`did not do that analysis, so Mr. Lewis could not have relied on him. Ex. 17. at 91:4–9; id. at 235:14–
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`20. Ultimately, Mr. Lewis’s failure to account for the incremental benefit of each of the
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`identified features attributable to the Asserted Patents resulted in an artificially inflated
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`
`
`
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`apportionment of the Value per User Month at step three.
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`Flyp’s attempts to distinguish Realtime, 2017 WL 11661896, fall flat. Contrary to Flyp’s
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`assertion, neither Mr. Lewis nor Dr. Nettles apportioned for the incremental benefit of each of the
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` identified features attributable to the Asserted Patents, instead dividing the entirety of the
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`
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`identified features by the
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` total features, just like in Realtime. Mr. Lewis’s multiple
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`apportionment steps cannot remedy his complete failure to apportion for the incremental benefit
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`as required by Realtime and Federal Circuit precedent, including Ericsson, 773 F.3d at 1226.
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`Moreover, Dr. Nettles admits that nearly all of the
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` features are also present in
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`unaccused Google Voice functionality. Dr. Nettles opines that
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`
`
`. Dkt. 178-10 ¶ 78; Ex. 17 at 114:4–10. Yet, Dr. Nettles
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`admits that
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` Ex. 17. at 216:2–217:16 (
`
`
`
`
`
`),
`
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`Mr. Lewis’s failure to consider the incremental benefit of those
`Asserted Patents.
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` features attributable to the
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`-7-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 11 of 13
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`237:25–239:5 (
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`). Thus, the entire value of
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`these features cannot properly be ascribed to the Asserted Patents.
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`3.
`
`Google’s Criticism of Mr. Lewis’s Apportionment Methodology Is Not
`a Factual Dispute
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`Finally, Flyp contends that Google is merely raising a factual dispute about the changes
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`made to Google Voice after the priority date of the Asserted Patents. But any such factual dispute
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`has no effect on Mr. Lewis’s duty to properly apportion. Regardless of whether Google Voice
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`changed after the priority date (it did not), these
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` features have been in Google Voice since
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`before the priority date of the Asserted Patents. Mot. at 10–13. Federal Circuit precedent thus
`
`requires Mr. Lewis to assess the incremental benefit attributable to the Asserted Patents for each
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`of the
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` preexisting and unaccused features. Ericsson, 773 F.3d at 1226 (citing VirnetX, Inc. v.
`
`Cisco Sys., Inc., 767 F.3d 1308, 1326 (Fed. Cir. 2014)).
`
`Flyp admits that Mr. Lewis used the same flawed apportionment analysis related to his
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`Flyp perspective as he did for his Google perspective. Mr. Lewis again took basic features that
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`unquestionably existed in prior art systems, including Google Voice, and failed to analyze the
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`incremental benefit attributable to the Asserted Patents in each of those features. Mot. at 14–15.
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`Thus, Mr. Lewis’s analysis from Flyp’s perspective is unreliable for the same reasons.
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`III. CONCLUSION
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`The Court should strike the opinions of Mr. Lewis discussed above. Individually, these
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`errors unjustifiably inflate his royalty ranges. Cumulatively, these flaws yield an unsupported
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`damages demand in excess of
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` Due to the unreliable nature of these opinions, they
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`should be stricken.
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`-8-
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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 12 of 13
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`DATED: December 5, 2023
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`
`
`
`Respectfully submitted,
`
`/s/ Robert W. Unikel
`Robert W. Unikel (Pro Hac Vice)
`robertunikel@paulhastings.com
`John A. Cotiguala (Pro Hac Vice)
`johncotiguala@paulhastings.com
`Daniel J. Blake (Pro Hac Vice)
`danielblake@paulhastings.com
`Grayson S. Cornwell (Pro Hac Vice)
`graysoncornwell@paulhastings.com
`PAUL HASTINGS LLP
`71 South Wacker Drive, Suite 4500
`Chicago, IL 60606
`Telephone: (312) 499-6000
`Facsimile: (312) 499-6100
`
`Elizabeth Brann (Pro Hac Vice)
`elizabethbrann@paulhastings.com
`Ariell N. Bratton (Pro Hac Vice)
`ariellbratton@paulhastings.com
`PAUL HASTINGS LLP
`4655 Executive Drive, Suite 350
`San Diego, CA 92121
`Telephone: (858) 458-3000
`Facsimile: (858) 458-3005
`
`Robert R. Laurenzi (Pro Hac Vice)
`robertlaurenzi@paulhastings.com
`PAUL HASTINGS LLP
`200 Park Avenue
`New York, NY 10166
`Telephone: (212) 318-6000
`Facsimile: (212) 319-4090
`
`Joshua Yin (Pro Hac Vice)
`joshuayin@paulhastings.com
`PAUL HASTINGS LLP
`1117 S. California Avenue
`Palo Alto, CA 94304
`Telephone: (650) 320-1800
`Facsimile: (650) 320-1900
`
`Dan L. Bagatell (Pro Hac Vice)
`dbagatell@perkinscoie.com
`PERKINS COIE LLP
`
`-9-
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`

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`Case 6:22-cv-00031-ADA Document 217 Filed 12/12/23 Page 13 of 13
`
`
`3 Weatherby Road
`Hanover, NH 03755
`Telephone: (602) 351-8250
`Facsimile: (602) 648-7150
`
`Andrew T. Dufresne (Pro Hac Vice)
`adufresne@perkinscoie.com
`PERKINS COIE LLP
`33 E. Main St. Ste. 201
`Madison, WI 53703
`Telephone: (608) 663-7460
`Facsimile: (608) 663-7499
`
`Paige Arnette Amstutz
`State Bar No.: 00796136
`pamstutz@scottdoug.com
`SCOTT, DOUGLASS & MCCONNICO, LLP
`303 Colorado Street, Suite 2400
`Austin, TX 78701
`Telephone: (512) 495-6300
`Facsimile: (512) 495-6399
`
`Attorneys for Defendant Google LLC
`
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`CERTIFICATE OF SERVICE
`
`
`
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`I hereby certify that on the 5th day of December, 2023, a true and correct copy of the
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`foregoing document was filed electronically with the Clerk of Court using the CM/ECF system.
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`As of this date, all counsel of record have consented to electronic service and are being served
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`with a copy of this document through the Court’s CM/ECF system and by email.
`
`/s/ Robert W. Unikel
`Robert W. Unikel
`
`
`
`-10-
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`