[00:00:01] Speaker 03: The United States Court of Appeals for the Ninth Circuit is now in session. [00:00:07] Speaker 00: Good afternoon. [00:00:09] Speaker 00: I'm Judge Gould and I'm presiding over this hearing. [00:00:13] Speaker 00: We have the case set for 20 minutes per side and Mr. Zapata represents appellants and he'll argue first and Mr. Zapata [00:00:27] Speaker 00: If you want to make a rebuttal argument, please try to save some of your time so you can use it on rebuttal. [00:00:35] Speaker 00: And Mr. Page, you're on board too, right? [00:00:45] Speaker 02: I am, Your Honor, yes. [00:00:46] Speaker 00: Good, okay. [00:00:46] Speaker 00: Well, without further ado, we can start with Mr. Zapata's argument. [00:00:55] Speaker 05: Thank you, Your Honor. [00:00:56] Speaker 05: Good afternoon, Your Honors. [00:00:57] Speaker 05: Adam Zapala may please the court from Cachette Petrie McCarthy on behalf of plaintiffs and appellants. [00:01:02] Speaker 05: I'd like to reserve four minutes of my time for rebuttal. [00:01:06] Speaker 05: Your Honors, I wanted to give you a brief overview of the trial court's errors and then sort of delve into each of those in a little bit more detail. [00:01:15] Speaker 05: The Trump appear court committed three errors that require reversal. [00:01:19] Speaker 05: In the alternative, as we've suggested in our briefs, [00:01:22] Speaker 05: These issues could also be certified to the California Supreme Court for their view. [00:01:28] Speaker 05: First, the trial court erred in dismissing, on a motion to dismiss, plaintiffs' tying claim premised on Qualcomm's undisputed policy of tying SEP licenses to their customers' purchases of chips. [00:01:41] Speaker 05: The trial court erred in construing the nature of competition in this tied market too narrowly and in a manner that conflicts with California law. [00:01:50] Speaker 05: The trial court also aired in dismissing the tying claim by over relying on this court's holding in the FTCB Qualcomm case, which construed federal instead of California law as this case raises. [00:02:02] Speaker 05: In so doing, the trial court assumed that a California court would follow this court's highly controversial holding that Qualcomm super friend licensing fee in violation of its standard setting obligations and also obtained by leveraging its chipset monopoly is not an antitrust violation. [00:02:18] Speaker 05: That issue has never been squarely addressed by the California Supreme Court, but the California Supreme Court's reasoning in its seminal Cipro case suggests that it would not follow this court's decision in the FTC case. [00:02:30] Speaker 00: Council Judge Gould, if I could interject a question. [00:02:34] Speaker 00: Isn't there a law generally that the state courts with their with their baby FTC and baby Sherman Act statutes will follow federal law in general? [00:02:51] Speaker 05: No, Your Honor. [00:02:52] Speaker 05: And in fact, normal states have what are called harmonization statutes, which talk about how they would harmonize their state antitrust law with federal law. [00:03:01] Speaker 05: California doesn't have one. [00:03:03] Speaker 05: And in fact, a number of courts have held, including California courts and including the Ninth Circuit, that the Cartwright Act, which is California's antitrust statute, is, quote, broader and deeper in reach than the Sherman Act. [00:03:15] Speaker 05: This court held an 18 t mobility inciting the California Supreme Court case in Cianci that the California Cartwright Act reaches antitrust violations in their insipency as opposed to the Sherman Act. [00:03:27] Speaker 05: So the Cartwright Act has often been construed more broadly than the federal Sherman Act. [00:03:35] Speaker 05: And, you know, you can see that in different examples that aren't necessarily applicable to this case. [00:03:39] Speaker 05: But, for example, indirect purchaser standing, vertical price fixing and the like. [00:03:44] Speaker 04: So, counsel, let me follow up on Judge Gould's question because even if you're right, the California Cartwright Act is broader than federal antitrust, the Sherman Act. [00:03:56] Speaker 04: Can you address more specifically the California cases in Morrison and Freeman and why those wouldn't lead to the conclusion that even under the Cartwright Act, [00:04:06] Speaker 04: up uh the the plaintiffs here have not shown a claim on because this is on so this issue is on summary judgment right or i guess both because you're saying part was dismissed on emotion dismiss and part on summary judgment [00:04:20] Speaker 05: That's right, Your Honor. [00:04:21] Speaker 05: The tying claim was dismissed by Judge Corley on a motion to dismiss, so obviously the allegations in the complaint have to be taken as true. [00:04:29] Speaker 05: The exclusive dealing claim was dismissed on summary judgment. [00:04:32] Speaker 05: So I think your question pertained to the tying claim, if I'm not mistaken, and that was obviously on a motion to dismiss. [00:04:38] Speaker 05: Okay, so let's discuss the tying claim. [00:04:40] Speaker 05: With respect to that claim, the plaintiffs had alleged and it was undisputed that Qualcomm had a so-called no license, no chip policy. [00:04:48] Speaker 05: And that is, in order to purchase chips from Qualcomm, OEMs were required to take out licenses from Qualcomm. [00:04:55] Speaker 05: It's undisputed that Qualcomm had a monopoly position on the chips. [00:04:59] Speaker 05: So with respect to the licenses, Qualcomm required its customers to purchase those license and included in those licenses were very onerous terms, which they were only able to extract from the Council. [00:05:11] Speaker 04: I mean, I'm familiar with the allegations that you've made, but the district court and I know you're taking issue with this. [00:05:19] Speaker 04: The district court said those allegations weren't enough. [00:05:23] Speaker 04: I thought the district court relied, correct me if I'm wrong, I thought the district court relied on the California cases of Morrison and Freeman to say that that was not enough under California law. [00:05:34] Speaker 04: So rather than, I mean, I get the allegations. [00:05:37] Speaker 04: The question is, are those allegations under Morrison and Freeman still enough to state a Cartwright Act claim? [00:05:46] Speaker 05: Yes, Your Honor. [00:05:47] Speaker 05: And here's why. [00:05:48] Speaker 05: The court construed competition in the Tide market too narrowly. [00:05:54] Speaker 05: And here's why. [00:05:55] Speaker 05: What the court said was, well, the Tide market, as you've alleged it, plaintiffs, is the SEP market, the market for standard essential patents. [00:06:02] Speaker 05: And because there's a patent, there could be no competition in that market. [00:06:05] Speaker 05: There's a patent that exists, it's closed over. [00:06:09] Speaker 05: That [00:06:09] Speaker 05: is that is is error and that's error under California law in the following way it misunderstands the nature of competition in the patent market that's why I backed up to just and I'll tell you why yeah because I mean seems to me that what the district court said is exactly right that the patent market is an exclusive monopoly [00:06:32] Speaker 04: Now you're going to tell me why it's not. [00:06:34] Speaker 04: So you're disagreeing not only with the fundamental premise that a patent gives an exclusive monopoly. [00:06:40] Speaker 04: I thought you were going to go further and say even assuming that the market still needs to be broader. [00:06:46] Speaker 05: No, the market is contestable. [00:06:50] Speaker 05: A patent is not inviolate. [00:06:52] Speaker 05: A patent is a limited grant, right? [00:06:54] Speaker 05: It can be challenged, and it often is. [00:06:56] Speaker 05: And in fact, courts across the country spend a lot of their time dealing with such challenges. [00:07:00] Speaker 05: And here's what Qualcomm did, and this is classic time. [00:07:05] Speaker 05: Qualcomm took very weak patents that they self-declared were subject to the standards. [00:07:11] Speaker 05: They tied that to their chips and said, you must not sign these licensing agreements. [00:07:16] Speaker 05: And by the way, in doing so, you give up your right to challenge these patents. [00:07:20] Speaker 05: You give up your right to challenge the validity of these patents. [00:07:23] Speaker 05: You give up your right to even say that they're subject to the standard at all. [00:07:27] Speaker 05: You give up your right to argue that you're not infringing. [00:07:30] Speaker 05: You give up your right to argue that the patent hasn't been exhausted by the sale of the chips. [00:07:35] Speaker 05: That's what Qualcomm did. [00:07:37] Speaker 05: Now you could ask yourself, if a patent is all they needed, [00:07:40] Speaker 05: right, to have an established monopoly, why did they need these other concessions from OEMs? [00:07:46] Speaker 05: They needed them because Qualcomm, what they effectively did was they transformed weak patents in the standard essential setting process into unassailable, uncontestable patents. [00:07:57] Speaker 04: Okay, so let me back up because, I mean, that's an interesting argument that I hadn't appreciated the nuance of. [00:08:04] Speaker 04: So I [00:08:05] Speaker 04: but did you ever contest the patent? [00:08:07] Speaker 04: I mean, you wouldn't have had to sign the licensing agreement to contest the patent, right? [00:08:12] Speaker 05: Of course not. [00:08:13] Speaker 04: And so then did you ever contest the patent or did you make these allegations in the complaint to say these weren't legitimate patents? [00:08:22] Speaker 05: Yes, the allegations are contained throughout the complaint and I can give you the record citation. [00:08:26] Speaker 05: Excuse me, just give me one moment to get there. [00:08:37] Speaker 05: Yeah, these are the paragraphs 2, 15, 55, 58 and 60, 76, 78 through 86. [00:08:48] Speaker 05: And this is in the complaint. [00:08:50] Speaker 05: This is, by the way, at 15 ER 3351, which is where plaintiff's complaints are. [00:08:54] Speaker 05: And the complaint alleges the nature of Qualcomm's weak patents and the fact that they leveraged their chipset monopoly to get [00:09:04] Speaker 05: unassailable, uncontestable patents. [00:09:07] Speaker 05: And here's why that's actually important. [00:09:10] Speaker 04: Well, can I back up? [00:09:11] Speaker 04: Because I'm trying to follow the theory of this here, because this does seem like a new theory that might not have been addressed previously, not to say that we can't use calculus, but it does seem a little bit different than Morrison and Freeman. [00:09:25] Speaker 04: Let's assume that these patents had been confirmed. [00:09:31] Speaker 04: By the way, have they been confirmed by anyone? [00:09:32] Speaker 04: Has anybody ever challenged the patents? [00:09:35] Speaker 05: Not to my knowledge, although it is significant that, I mean, this just shows you the coercive nature of the tie. [00:09:42] Speaker 04: I understand. [00:09:43] Speaker 04: I understand. [00:09:44] Speaker 04: But if the patents had been challenged and upheld as valid, [00:09:50] Speaker 04: would you still have a Cartwright Act claim or would your claim, because your claim seems to be based on the fact that these are weak patents, if the patents were shown to be sustainable and defendable, defensible, would you still have a Cartwright Act claim? [00:10:08] Speaker 05: You don't think so? [00:10:09] Speaker 05: That's obviously not the facts of this case, but there might be patent preemption type arguments there. [00:10:15] Speaker 05: But that's exactly, you're putting your kind of finger on the error of the district court, which was to say, well, there's a patent here. [00:10:22] Speaker 05: The question wasn't really asked. [00:10:24] Speaker 05: If that's all that it takes to lock up a market and get 100% monopoly, why would Qualcomm need these extra assurances from their OEMs? [00:10:32] Speaker 05: And here's, I just want to- [00:10:34] Speaker 04: Council, even you can concede that there would be a lot of reasons to get these extra assurances. [00:10:40] Speaker 04: I mean, patents are challenged all the time. [00:10:42] Speaker 04: Legitimate patents are challenged all the time. [00:10:44] Speaker 04: And those challenges can be highly expensive and unsettling to the market. [00:10:50] Speaker 04: And so I don't think it's fair to say that just because they put that in means that they knew that they were weak. [00:10:58] Speaker 04: patents. [00:11:00] Speaker 04: I think the question ultimately boils down to were these weak patents and if they were, you know, and were they leveraging weak, indefensible patents into a different market? [00:11:12] Speaker 05: Those are the clear allegations of the complaint. [00:11:14] Speaker 05: They have to be taken true on a motion to dismiss. [00:11:16] Speaker 05: That's what the complaint alleges. [00:11:18] Speaker 05: Whether we'll be able to prove that ultimately will be a question of proof. [00:11:23] Speaker 05: This was thrown out at the motion to dismiss stage. [00:11:25] Speaker 05: That's exactly what the complaint alleges. [00:11:27] Speaker 05: And I think it's also really important. [00:11:29] Speaker 05: This is a quote from a noted [00:11:30] Speaker 05: antitrust scholar Herbert Hovenkamp. [00:11:33] Speaker 05: And he's talking about the standard setting process. [00:11:35] Speaker 05: And I think there's a little bit of a disconnect, again, between the district courts holding and this aspect of how patents are set. [00:11:41] Speaker 05: And he says, this phenomenon of increased value for SEPs also motivates patent-owning firms to over claim. [00:11:49] Speaker 05: That is, to assert that patents are standard and central when subsequent litigation or evaluation determines that they are not. [00:11:55] Speaker 05: While friend agreements require participants to declare relevant patents thought to be essential, the rate of actual declaration far exceeds any rational boundary. [00:12:04] Speaker 05: As many as one-third to more than half of declared SEPs are likely not essential to the standard for which they were declared. [00:12:10] Speaker 05: In fact, overall infringement rates for SEP patents are not materially different from those non-SEP patents. [00:12:17] Speaker 05: And so again, what we are alleging is that they leverage weak patents by holding the chipset monopoly over the heads of the OEMs. [00:12:26] Speaker 05: That's the first manner in which they restrain competition in the tide markets. [00:12:30] Speaker 05: That's the first way in which the district court erred in dismissing our complaint on a motion to dismiss. [00:12:36] Speaker 05: The second way in which the court erred was in overly relying on this court's decision in the FTC case, which construed federal instead of California law in the following way. [00:12:47] Speaker 05: We have also alleged that Qualcomm imposes, as part of the owner's licensing terms, a super friend licensing fee. [00:12:55] Speaker 05: Okay, we allege that is a violation of their standard setting obligation and therefore is harming competition in the tide market. [00:13:04] Speaker 05: The Ninth Circuit have found that Qualcomm superfan licensing fees, although a violation of their standard setting obligations, sounded in patent or contract law and not in antitrust law. [00:13:14] Speaker 05: But there's every reason to believe that a California court would go the other way on this issue. [00:13:18] Speaker 05: And just being completely candid and open with you, [00:13:22] Speaker 05: This issue of violating one standard setting obligations and whether that constitutes an antitrust fight. [00:13:27] Speaker 05: It's hugely controversial. [00:13:28] Speaker 05: There are scholars on both sides of this issue. [00:13:31] Speaker 05: It is by no means a clear cut issue. [00:13:33] Speaker 05: Reasonable minds can disagree on this issue. [00:13:36] Speaker 05: And in fact, reasonable minds have disagreed. [00:13:39] Speaker 05: The district court judge originally presiding over this case, Judge Lucy Coe, went the other way on this issue and is now a member of this very court. [00:13:46] Speaker 05: um and so the idea that a California jurist it would you know it's it's crazy to think a California jurist would find um um an antitrust violation here is not but that council that that's not the test the test isn't can we find a California jurist that would do this the test is what do we think looking at California law [00:14:09] Speaker 04: the California Supreme Court would do, and I'm trying to figure out what case you would point to to lead us in that direction. [00:14:19] Speaker 05: I'm so glad you asked that question, Your Honor. [00:14:21] Speaker 05: That was where I was going next. [00:14:24] Speaker 05: So Fox does reasonable minds, I think, can differ. [00:14:26] Speaker 05: That issue has engendered a lot of controversy. [00:14:30] Speaker 05: The California Supreme Court has given us an indication that it would rule in our favor in this regard, and that's the California Supreme Court Cipro case. [00:14:37] Speaker 05: And albeit, the court distinguished that case, the district court distinguished that case on the facts. [00:14:42] Speaker 05: It was a horizontal conspiracy claim. [00:14:46] Speaker 05: But what the important thing was about that court's decision there, the Supreme Court's decision there, was California correctly held, unlike the district court, that patents are not inviolate. [00:14:56] Speaker 05: that antitrust claims can be based on patents, especially where the defendant has abused their patent rights as we've alleged here. [00:15:03] Speaker 05: We've alleged that Qualcomm abused their patent rights because they imposed a super friend licensing fee in the tide market, contrary to their standard setting obligations that restrains competition in the tide market. [00:15:17] Speaker 03: Okay, Council, but the question of a vertical versus a horizontal restraint seems to be pretty critical. [00:15:26] Speaker 03: So you sort of take the patent out of here and ask, would California recognize vertical restraints in ways that the federal antitrust laws would not? [00:15:35] Speaker 03: You know, what in CIPRO tells us that California would recognize that? [00:15:39] Speaker 05: Well, first of all, the court didn't limit its holding in that way. [00:15:43] Speaker 05: It never said, oh, by the way, this analysis doesn't apply to other areas of our antitrust scrutiny, number one. [00:15:49] Speaker 05: Number two, you brought up the issue of horizontal versus vertical. [00:15:53] Speaker 05: A little bit off topic, but you know, this is one area in which California law differs greatly from federal law. [00:16:00] Speaker 05: And under federal law, a vertical restraint is always reviewed under the rule of reason test. [00:16:06] Speaker 05: In California law, for example, vertical price fixing, that's subject to a per se claim. [00:16:11] Speaker 05: Totally different than federal law. [00:16:13] Speaker 05: So, you know, it's not at all clear that just because there's a vertical arrangement here, California would somehow depart from its CIPRO decision and find that, well, it's okay for an entity to abuse its patent rights so long as it's in a vertical relationship. [00:16:27] Speaker 05: I'm not aware of any California authority that would that would militate in favor. [00:16:33] Speaker 04: But it seems to me that you've got to come up with some California authority that I mean, you're advocating for an extension of SIPRA into this context. [00:16:42] Speaker 04: You're saying that [00:16:43] Speaker 04: California would do that. [00:16:45] Speaker 04: And I'm trying to flesh out what is the case other than CIPRA that would tell us that California courts would go this way? [00:16:53] Speaker 04: And I want to ask this because of the timing here, because this sort of rolls into the certification question. [00:17:01] Speaker 04: Are there cases that would go both ways such that we would justify us certifying this to the California Supreme Court? [00:17:08] Speaker 05: Your Honor, I think the closest analogous case is Cipro, candidly, and I think you're absolutely right that that militates in favor of certification. [00:17:15] Speaker 04: Be clear. [00:17:16] Speaker 04: I'm not actually saying that. [00:17:17] Speaker 04: I'm saying you need to show us some conflicting law, as I read the law, to justify [00:17:25] Speaker 04: certifying this to the California Supreme Court, and I don't see conflicting law on this. [00:17:29] Speaker 05: Respectfully, that's not the test for certification. [00:17:31] Speaker 05: The test is that there is no precedent, right? [00:17:34] Speaker 05: And that's why the California Supreme Court needs to weigh in here. [00:17:38] Speaker 05: There is no controlling California Supreme Court precedent. [00:17:41] Speaker 05: So the federal courts would be forced into a situation where they would have to guess what a California Supreme Court would do under this facts scenario. [00:17:49] Speaker 05: I'm suggesting that [00:17:50] Speaker 05: the California Supreme Court would follow CIPRO, right? [00:17:53] Speaker 05: But it's absolutely true. [00:17:55] Speaker 05: This set of facts has not ever hit the California Supreme Court, and that's part of our argument as to why it ought to be certified. [00:18:01] Speaker 05: And so I do see that I'm out of my time in terms of I'll reserve the rest for my rebuttal. [00:18:07] Speaker 05: I didn't have an opportunity to get to the exclusive dealing claim, which was dismissed at summary judgment. [00:18:12] Speaker 05: I'd be happy to do that on rebuttal, but I'll rest there for now. [00:18:16] Speaker 05: Thank you, Your Honors. [00:18:30] Speaker 02: Good afternoon, Your Honor. [00:18:32] Speaker 02: Good afternoon, Your Honors, and may it please the Court. [00:18:34] Speaker 02: Gene Page, appearing on behalf of the Appellee Qualcomm. [00:18:37] Speaker 02: I'd like to start off just with what we just heard about the tying claim. [00:18:43] Speaker 02: I would just say that none of this about weak patents and so on and so forth is found in the briefs. [00:18:50] Speaker 02: I don't think you'll find it there. [00:18:52] Speaker 02: I certainly didn't see it there. [00:18:54] Speaker 04: When you say look back at the briefs, you're talking about the appellate briefs or the lower court briefs? [00:18:59] Speaker 02: I'm talking about the appellate briefs, and I don't know that this was expressly raised in the district court either, but it certainly wasn't in either of the [00:19:06] Speaker 04: So I want to ask about that, because I mean, there's two different ways we could skin this cat. [00:19:13] Speaker 04: One would be a waiver argument, which is what you seem to be arguing, advocating for. [00:19:18] Speaker 04: But let's say that we were able to look at that, and we go back and read the complaint, the citations that Appellant Council just appointed us to, and said, [00:19:32] Speaker 04: You know, look, the complaint does allege weak patents. [00:19:36] Speaker 04: We can consider that. [00:19:40] Speaker 04: Do you agree that the district court didn't deal with this specific argument about the weak patents versus just a patent generally? [00:19:48] Speaker 02: I'm not sure this argument was raised the district court, so I'm not sure that she did, Your Honor. [00:19:52] Speaker 02: But let me just kind of take a step back for a moment and answer a couple of questions you had. [00:19:57] Speaker 02: The first was, have these patents been challenged? [00:19:59] Speaker 02: And the answer is yes. [00:20:01] Speaker 02: Uh, as you may know, there was litigation between Qualcomm and Apple around this time as well. [00:20:06] Speaker 02: Apple did challenge several of Qualcomm's patents. [00:20:08] Speaker 02: And in fact, those challenges are continuing, uh, in the Federal Circuit today. [00:20:11] Speaker 04: And those patents would have been, those patents would have been, I mean, it's, it's hard for me to track all the different patents and what would be related to this case versus patents that would not be related to this case. [00:20:24] Speaker 04: But your position is, Pat, all the patents that are directly related to this case have been challenged? [00:20:31] Speaker 02: Oh no, your honor. [00:20:31] Speaker 02: I'm saying there are definitely patents that would be owned by Qualcomm. [00:20:36] Speaker 02: Qualcomm owns a number of patents and those have been challenged by companies including Apple. [00:20:41] Speaker 02: And some of those challenges are still ongoing today in the federal circuit. [00:20:44] Speaker 02: So I just wanted to make that factual. [00:20:45] Speaker 04: Well, yeah, but I don't know what relevance that has to this case. [00:20:48] Speaker 02: I don't know that it does, Your Honor, and here's why. [00:20:50] Speaker 04: All right. [00:20:51] Speaker 02: Here's why. [00:20:52] Speaker 02: Because what we're hearing here is that there is some kind of effect in the market, in the so-called tied market. [00:20:59] Speaker 02: But let's look at what they've alleged and what the law requires. [00:21:04] Speaker 02: Under California law, like any antitrust law, you'd have a tying product and a tied product. [00:21:11] Speaker 02: Now plaintiffs say the tying product is Qualcomm's chips, and that the tied product are licenses to Qualcomm's standard essential patents. [00:21:21] Speaker 02: But the thing that you try to prevent with making tying unlawful is harming competition in the tied market. [00:21:31] Speaker 02: And there is no competition in plaintiffs' tied market. [00:21:34] Speaker 02: The only entity that can sell licenses to Qualcomm's SCPs is Qualcomm. [00:21:40] Speaker 02: There's no competition in that market, so no competition can be harmed. [00:21:45] Speaker 04: Okay, forgive me. [00:21:46] Speaker 04: I may be totally off base here because I wasn't fully prepared for the nuanced argument that is being advocated here at Oral Argument, but the only reason you can say that is because you have a patent. [00:22:00] Speaker 04: I mean, anybody can get a patent on anything and those patents may be valid or not valid. [00:22:06] Speaker 04: It can't be the case that you just go in and get a patent and say, okay, I've got a patent, therefore I have a monopoly, therefore you can't challenge me. [00:22:16] Speaker 04: And it turns out that you don't actually have any science behind this and they're completely invalid. [00:22:22] Speaker 04: I'm not saying that's the case here, but your position seems to be based on the validity of those patents. [00:22:29] Speaker 02: No, Your Honor, our position is based on the fact that there is no competition in the market. [00:22:34] Speaker 02: In other words, if you have, say, Samsung SEPs or SEPs held by Ericsson, those aren't substitutes for Qualcomm SEPs. [00:22:43] Speaker 02: You can't say, I'm going to use Samsung's SEPs and therefore I don't need Qualcomm's SEPs. [00:22:49] Speaker 02: Qualcomm's SEPs are unique assets that don't have a substitute in the SEPs of other companies because having an SEP from another company [00:22:59] Speaker 02: doesn't give you the right to practice Qualcomm's patents. [00:23:02] Speaker 02: You can practice that other company's patents. [00:23:04] Speaker 03: Counsel, listen to the problem that if the patents were challenged and if the patents were not upheld, then Samsung could obtain a patent or could simply use the technology on its own if it is not patentable. [00:23:20] Speaker 03: So, I mean, doesn't this beg the question somewhat? [00:23:23] Speaker 02: Well, no, Your Honor, because the question here is, what is the competition being restrained in the tide market, right? [00:23:30] Speaker 02: Who is the competitor that is being harmed here? [00:23:34] Speaker 02: And nowhere in their brief, in either of their briefs, did they say who the competitors were in this tide market, because there aren't any. [00:23:42] Speaker 02: This supposed tide market doesn't have any competitors in it. [00:23:45] Speaker 04: Okay, so I want to make sure I understand your argument. [00:23:50] Speaker 04: Because this is a little bit different than with the district. [00:23:52] Speaker 04: The district court said, because you have a patent, you have an exclusive right, therefore there's no competition in that market by virtue of the patent. [00:24:03] Speaker 04: You're now saying, regardless of whether the patents are valid or not, the plaintiffs didn't allege separately that other [00:24:13] Speaker 04: companies either were or would have come into the market but for the patents and that's the deficiency. [00:24:20] Speaker 02: Yeah, I think, Your Honor, what the district court said was slightly different, which is that there are no rival sellers in that market. [00:24:27] Speaker 02: And that's true. [00:24:28] Speaker 02: There is no one else in the market that can sell a Qualcomm SEP. [00:24:32] Speaker 02: There may be people that can sell their own SEP. [00:24:35] Speaker 04: And that is regardless. [00:24:36] Speaker 04: So your point is this doesn't really rise or fall on the patents. [00:24:40] Speaker 04: It rises or falls on the fact that no one else is in the market and they didn't identify anybody else in the [00:24:45] Speaker 01: Exactly, Your Honor. [00:24:46] Speaker 04: But aren't they just going to say, well, of course there's nobody else in the market because there's a patent out there and the patent scared everybody off. [00:24:55] Speaker 04: And we don't think those are valid patents. [00:24:57] Speaker 04: We've alleged that they're not valid patents. [00:25:00] Speaker 04: And if we're right that they're not valid patents, then there would be other market participants. [00:25:04] Speaker 02: But the point is, Your Honor, that they've defined the market as Qualcomm's SEPs. [00:25:08] Speaker 02: No one else has the right to sell those. [00:25:10] Speaker 02: That's their market definition. [00:25:12] Speaker 04: I think this goes to Judge Bybee's question, if I'm not mistaken, which is, others would have the right to sell it if they weren't protected by a patent. [00:25:21] Speaker 02: Not sell the license to the patents. [00:25:23] Speaker 02: That's what they're saying the market is, a license to the patents. [00:25:27] Speaker 02: What they're saying is that no one [00:25:32] Speaker 02: actually wants to buy these things they're saying that we are forcing people to take things they don't want but that's not a time claim that is exactly like Belton versus Comcast where someone didn't want to buy the basic tier of cable television [00:25:50] Speaker 02: to get the music versus our music or FM services. [00:25:53] Speaker 02: But that wasn't a time claim because there was no other competitor in that market. [00:25:57] Speaker 02: No competition being restrained in that market for the basic tier of cable television. [00:26:02] Speaker 02: And they went to bought it anyway. [00:26:04] Speaker 00: My counsel could just judge schools. [00:26:06] Speaker 00: I could interject and I may be missing something. [00:26:10] Speaker 00: So correct me if I'm stating this incorrectly, but at least as I understand it. [00:26:19] Speaker 00: On the tying claim, the tied product is allegedly the licenses from Qualcomm. [00:26:33] Speaker 00: And since no one but Qualcomm can give those licenses, it seems like there's no competition in the market for the alleged tying product. [00:26:48] Speaker 02: That's exactly correct, Your Honor. [00:26:50] Speaker 02: There is no competition and therefore no competition could be harmed and therefore it can't stay at a tying claim. [00:26:55] Speaker 00: So that would be one basis on which that claim could be properly dismissed. [00:27:03] Speaker 02: That's also correct. [00:27:05] Speaker 00: And also I have another point. [00:27:07] Speaker 00: Am I right that the alleged tying claim was not raised in the opening brief? [00:27:18] Speaker 00: on appeal. [00:27:21] Speaker 00: I know there was a big council commented about whether it was raised in the district court complaint, but my question is, was it raised in the opening brief on this appeal? [00:27:36] Speaker 02: I think in the way it has just been framed at the beginning of this argument, no, it has not. [00:27:42] Speaker 02: I mean, I don't see anything about weak patents in the opening brief or the reply brief for that matter. [00:27:47] Speaker 02: But I do agree with what Your Honor said about that being the proper manner in which they dismissed the tying claim. [00:27:55] Speaker 02: And I just want to emphasize that is why Judge Corley dismissed the tying claim because there is no competition to be restrained in the tide market. [00:28:06] Speaker 02: And therefore, it was dismissed based on California law [00:28:11] Speaker 02: standard principles of California law under Morrison versus Viacom, under Belton versus Comcast. [00:28:16] Speaker 02: That's what was dismissed under, not under the FTC decision. [00:28:20] Speaker 02: I mean, she was looking directly at cases where the allegations are such that there is no competition, no competitor and no competition being harmed in the tying market, whether because, I'm sorry, in the tied market, whether because [00:28:41] Speaker 02: there is no other seller in the tide market or because the [00:28:45] Speaker 02: buyers don't want what's being sold in the tide market. [00:28:49] Speaker 02: In either case, there's no doubt. [00:28:51] Speaker 03: Let me ask. [00:28:52] Speaker 03: You just said that the district court didn't look to our decision in FTC on this matter, but looked to California cases. [00:29:01] Speaker 03: Did it look to the California cases to see whether those cases departed in any way from our analysis in FTC? [00:29:08] Speaker 03: In other words, it looks to me like the district court's analysis comes out very sympathetic to [00:29:13] Speaker 03: FTC. [00:29:15] Speaker 03: Maybe she got there in a slightly different way, but it looks like it's the same analysis that we used in FTC. [00:29:27] Speaker 02: I would certainly say that Judge Cooley took FTC seriously as a matter of stare decisis. [00:29:32] Speaker 02: She understood that she was bound by the, you know, [00:29:36] Speaker 02: legal conclusions that were reached in that case, uh, as, as your honors, uh, said that she would be, uh, in your, in your opinion on 23F. [00:29:45] Speaker 02: Uh, but, you know, she didn't base her ruling on the FTC alone. [00:29:50] Speaker 02: She based it on, on the tying, on standard principles of California law for tying. [00:29:58] Speaker 03: Standards, standards which the district court thought were the same as, as they were under the federal law. [00:30:04] Speaker 02: They absolutely are the sandwich of the federal law, Your Honor. [00:30:06] Speaker 02: There is no case that plaintiffs have cited to where the tied market has no competition or no competitors in it. [00:30:20] Speaker 02: There's just, it's not there at all. [00:30:23] Speaker 02: And so that's true in Belton versus Comcast, 151 Cal App 4th, 1224, Morrison versus Viacom, 66 Cal App 4th, 534. [00:30:33] Speaker 02: and in the federal courts, below versus how in realty, 574, Fed 3rd, 108. [00:30:38] Speaker 03: Did the district court find any cases in which that analysis was present or that fact was present? [00:30:43] Speaker 03: That is that there was a claim of a tide market in which there were no competitors? [00:30:48] Speaker 02: No. [00:30:48] Speaker 02: In fact, she said quite the opposite. [00:30:50] Speaker 02: She said that the plaintiffs couldn't point to any. [00:30:54] Speaker 03: Yeah, but the fact that we can't point to anything, though, then does raise the question of what about certification? [00:30:59] Speaker 03: And it seems to me that the problem with certification is it really does feel like a bit of a collateral attack on our FTC decision. [00:31:09] Speaker 03: But as long as we hold open the possibility that California law is not the same as federal law, should we allow the California Supreme Court to weigh in on that question? [00:31:21] Speaker 02: No, Your Honor, because the [00:31:23] Speaker 02: The rule is clear and consistent in all of the cases. [00:31:27] Speaker 02: Belton versus Comcast says it, Morrison versus Ficom says it, Blow versus Howland says it. [00:31:32] Speaker 02: If you don't have competition in the tide market, there is no tying claim. [00:31:38] Speaker 02: They haven't cited a single case in which there was no competition in the tide market and there was a tying claim. [00:31:45] Speaker 02: It's just, it's, it's, it's black letter law that you can't have such a claim. [00:31:54] Speaker 04: and they still do you do you want to address briefly the summary and it's a little unfair not unfair that i i know appellants didn't have a chance to delve into the uh... you know the summary the the the issues that were resolved on summary judgment [00:32:10] Speaker 04: the exclusive dealing, right? [00:32:14] Speaker 04: Does that rely on the patent? [00:32:16] Speaker 04: Does that rely more on the patent? [00:32:19] Speaker 04: Because your position is the patent isn't really relevant to the unlawful tying. [00:32:23] Speaker 04: Whether there's a patent or not, there's no competition. [00:32:27] Speaker 04: But the viability of the patents is more related to the exclusive dealing claim, isn't it? [00:32:37] Speaker 02: I don't know that's the case, Your Honor. [00:32:40] Speaker 02: I mean, they are claiming that we entered into exclusive dealing arrangements with a couple of companies. [00:32:51] Speaker 02: And I'll just, I'll make two points there. [00:32:53] Speaker 02: The first one is that they claim that there's an exclusive dealing arrangement with Samsung. [00:32:59] Speaker 02: And the district court found at one ER 12, page 12 of volume one of the ER, [00:33:07] Speaker 02: that there was no such term in the Samsung agreement, and they haven't contested that really. [00:33:13] Speaker 02: They haven't made any comment on it in their reply brief. [00:33:17] Speaker 02: And then as to Apple, they are saying that they can sort of change up their theory [00:33:26] Speaker 02: from what it was before with the new declaration from Mr. Flam. [00:33:33] Speaker 02: But of course, Dr. Flam's declaration was not permitted to come into the case because the expert discovery closed years before. [00:33:45] Speaker 04: Can I ask a little bit about that? [00:33:46] Speaker 04: I mean, number one, how important is Dr. Flam's [00:33:51] Speaker 04: Because it seems to me that one way to resolve this case would be just to go to the merits and say, look, Flam's declaration doesn't change the analysis on this exclusive dealing part that we've, you know, that you've just addressed. [00:34:11] Speaker 04: The other one would be to say the district court didn't abuse its discretion on Dr. Flam, which may also be true, but I am a little bit troubled by this idea that, you know, there's this intervening, there's this intervening case law, which comes out from our court in the FTC. [00:34:28] Speaker 04: We remand, in the FTC case, we remand. [00:34:32] Speaker 04: It's not that crazy that plaintiffs would go back and revisit their case. [00:34:38] Speaker 04: And perhaps, I know they had the opportunity. [00:34:42] Speaker 04: I mean, nothing would have prohibited them from putting in Dr. Flam before. [00:34:45] Speaker 04: But say there's 10 issues, you know, and they didn't focus heavily on these last two issues. [00:34:51] Speaker 04: When it goes back, they're just left with these two issues. [00:34:53] Speaker 04: And they're like, now we want to develop it. [00:34:55] Speaker 04: Why wouldn't this court allow them to develop it and bring in Dr. Flam? [00:35:00] Speaker 04: It does seem like he became much more relevant after we decided our FTC case than before. [00:35:08] Speaker 02: Well, let's unpack a few things here, Your Honor. [00:35:11] Speaker 02: First, nothing changed in the law of exclusive dealing from the FTC decision. [00:35:17] Speaker 02: There was no change whatsoever in exclusive dealing law. [00:35:21] Speaker 02: And the exclusive dealing claim has been in this case from the start. [00:35:26] Speaker 02: They had it in the consolidated amended claim and consolidated amended complaint in 2017. [00:35:31] Speaker 02: They could have developed it as much as they wanted to. [00:35:33] Speaker 02: They chose instead to go with a theory that said all that the exclusive dealing does is exacerbate the effect of the so-called tax. [00:35:43] Speaker 02: So they chose to do it that way. [00:35:46] Speaker 02: Right. [00:35:46] Speaker 04: So your response to my hypothetical about, yeah, these might have been 9 and 10 on their list of importance, but they still didn't develop them. [00:35:56] Speaker 04: And just because 1 through 8 got knocked out doesn't mean you go get a second bite at the apple with 9 and 10. [00:36:03] Speaker 02: Precisely, Your Honor. [00:36:04] Speaker 02: And it's more than just that. [00:36:06] Speaker 02: I mean, Dr. Flam wasn't not in the case to begin with. [00:36:10] Speaker 02: He was in the case. [00:36:12] Speaker 02: And when we deposed him, [00:36:13] Speaker 02: During expert discovery, we asked him, I asked him, whether prices of chips are too high, too low, or just right. [00:36:22] Speaker 02: He said no. [00:36:23] Speaker 02: He said no. [00:36:24] Speaker 02: And that is 14 ER 3289 to 90. [00:36:32] Speaker 02: Later on in the deposition, he talked about things he didn't explore. [00:36:35] Speaker 02: And he said exclusive dealing was one of those things. [00:36:38] Speaker 02: And that's the supplemental excerpts record at seven. [00:36:41] Speaker 02: So this is not just kind of coming in as something it could have come in with before. [00:36:45] Speaker 02: It's coming in with something it could have come in with before that contradicts. [00:36:49] Speaker 04: There's evidence to suggest they intentionally didn't develop it. [00:36:53] Speaker 04: I don't know about intentionally, but clearly the opportunity was there and they didn't develop it. [00:37:00] Speaker 02: precisely are. [00:37:00] Speaker 02: They chose not to go with this. [00:37:03] Speaker 02: And certainly it's not an abuse of discretion, which both sides agree is the standard here for Judge Corley. [00:37:09] Speaker 04: Do you think it would be different if they hadn't raised these claims initially, and then once the core of their case was knocked out because of the FTC case, they amended the complaint and added these? [00:37:22] Speaker 04: Would that have been different? [00:37:24] Speaker 02: I don't know that would be possible, Your Honor, because you'd have to sort of add it well after the discovery had closed and everything was done. [00:37:32] Speaker 02: I'm not sure how you can add something when the case has gone that far down the track. [00:37:37] Speaker 04: That would be... Well, but they were allowed to amend their complaint. [00:37:41] Speaker 02: They were. [00:37:42] Speaker 02: They were. [00:37:42] Speaker 04: But they couldn't add new claims. [00:37:45] Speaker 04: Is that your position? [00:37:47] Speaker 02: I think that would be fair to say, Your Honor. [00:37:48] Speaker 02: It's not very [00:37:49] Speaker 00: uh... just add new claims after discoveries closed council before all your time is gone and i'll i'm gonna use up some of your last minutes but then i'll give you a little extra time if you need it but my question is this [00:38:07] Speaker 00: It's been a while since I went to law school, but at least when I studied antitrust law and practiced in it, my understanding was always that exclusive, exclusive dealing agreements are not per se unlawful. [00:38:27] Speaker 00: under the antitrust law and that while they may restrict competition in a particular brand that someone has an exclusive deal to sell, they may enhance competition between different brands because there can be other [00:38:52] Speaker 00: sellers of different brands. [00:38:54] Speaker 00: And so my question relating to that, if that's the theory here that still applies on exclusive dealing, what, if any, was the competitive impact of the exclusive dealing arrangement challenged here? [00:39:18] Speaker 02: Well, Your Honor, I think there's kind of two things I'd like to say there. [00:39:20] Speaker 02: First is that [00:39:22] Speaker 02: You know the arrangements between Qualcomm and Apple were helpful in terms of allowing Qualcomm to make investments into products that would be used for Apple. [00:39:33] Speaker 02: And so that's kind of a pro competitive reason for the arrangements between Qualcomm and Apple. [00:39:39] Speaker 02: You needed to have [00:39:41] Speaker 02: some assurance that all of the work you're doing is going to come out at the end with some reward. [00:39:46] Speaker 02: And then second, in terms of the impact, I just want to make sure it's clear that Judge Corley was asking about whether there was a showing of foreclosure in both the CDMA and so-called premium LTE markets. [00:40:01] Speaker 02: And that's at 1ER 14 to 15, where she said, I asked this, plaintiffs couldn't show it to me. [00:40:08] Speaker 02: We pointed that out in our answering brief. [00:40:11] Speaker 02: They still haven't shown anywhere, even in the excluded FLAM report, where they have evidence of the foreclosure, supposed foreclosure, in both of the markets that they've pled. [00:40:23] Speaker 02: So even with FLAM in, they don't have the evidence to survive summary judgment. [00:40:29] Speaker 02: My time has expired. [00:40:32] Speaker 05: Your Honor, I know that I have some limited time. [00:40:34] Speaker 05: I'm going to start out, I think, where we ended with exclusive dealing and this issue of Dr. Flom to address Judge Nelson's inquiry. [00:40:42] Speaker 05: We have to understand what happened here. [00:40:44] Speaker 05: Plaintiffs alleged four to five intertwined theories of antitrust harm at the District Court level. [00:40:50] Speaker 05: Those were intertwined. [00:40:52] Speaker 05: All of them said, don't state cognizable theories of antitrust harm. [00:40:56] Speaker 05: The court said they do. [00:40:57] Speaker 05: So the parties proceeded on the basis of an intertwined theory of antitrust harm. [00:41:02] Speaker 05: That radically changed when the Ninth Circuit said, you can't, those three of those four aren't cognizable. [00:41:08] Speaker 05: So, and in fact, [00:41:10] Speaker 05: found that there was a failure of proof on the exclusive dealing claim. [00:41:13] Speaker 05: When it came to the district court, so the parties of course constructed their damages models, both the FTC and the private plaintiffs, based on an intertwined theory of antitrust harm. [00:41:23] Speaker 05: That was out after the FTC decision. [00:41:25] Speaker 05: We respectfully suggest that it was an abuse of discretion not to permit us to isolate damages arising solely from the exclusive dealing claim at that point. [00:41:34] Speaker 03: Counsel, was the question of the intertwined harms, is that something that you assumed, or is that something that the district court limited you to? [00:41:43] Speaker 03: Is there anything that prevented you from saying, we're going to proceed on two tracks here because we have two different statutes that authorize damages here. [00:41:53] Speaker 03: One is the federal statute, one is the state statute. [00:41:56] Speaker 03: The state statute is broader and deeper than the federal statute. [00:41:59] Speaker 03: So even if we lose on the federal statute, we're going to prevail on the state statute and we're going to proceed with two different things. [00:42:05] Speaker 03: Did you argue that? [00:42:07] Speaker 05: Not exactly in that way, Your Honor, and I think we're getting mixed up between federal and state. [00:42:11] Speaker 05: What I was arguing was that the antitrust theories of violation of liability, there were four of them, and those proceeded as a package, and they did so because the district court said, yeah, those stayed a claim, right? [00:42:25] Speaker 05: So the parties we believe are entitled to rely on the district court's decision about what the law of the case is. [00:42:31] Speaker 03: But Counsel, you argued both federal law and state law, right? [00:42:35] Speaker 03: Correct. [00:42:36] Speaker 03: And did you break those out in your analysis of the violations in any way? [00:42:43] Speaker 03: Did you attempt to draw any distinction between the two? [00:42:46] Speaker 05: Because both federal and California claims were cognizable at that point. [00:42:50] Speaker 05: The district court had said those claims are cognizable, both claims, both sets of claims. [00:42:55] Speaker 05: And so we constructed damages models based on the intertwined theories. [00:43:01] Speaker 05: And then that situation changed later when this court, the Ninth Circuit, held that three of those four were not cognizable. [00:43:09] Speaker 05: And that's why we then need time. [00:43:10] Speaker 04: Council, I get your point. [00:43:12] Speaker 04: And I got to admit, I was a little bit sensitive to it. [00:43:15] Speaker 04: But I think at the end of the day, and maybe this is sort of where Judge Bybee's going, you could have developed these. [00:43:22] Speaker 04: I mean, there was nothing preventing you from doing it before. [00:43:26] Speaker 04: You're just saying, we thought we already had it in this other bucket. [00:43:29] Speaker 05: We did develop them. [00:43:31] Speaker 05: Let's be clear. [00:43:33] Speaker 05: The evidence is all the same. [00:43:35] Speaker 05: We didn't reopen fact discovery. [00:43:37] Speaker 05: All we had are experts. [00:43:38] Speaker 04: That can't be true that the evidence is all the same because Flam came in with new evidence that you're saying should have been acknowledged. [00:43:45] Speaker 05: New analysis based on existing evidence, right. [00:43:49] Speaker 05: All we did was say, okay, I put in a damage model before that calculated damages based on all four of these theories. [00:43:55] Speaker 05: Now here's the damage figure based solely on the exclusive dealing claim. [00:43:58] Speaker 05: which we never said we had to do before that. [00:44:02] Speaker 05: And so, yeah, I mean, in order to do what you were saying, every combination of four intertwined theories, I think, would have resulted in something like 30 different damages models that we would have had to demonstrate. [00:44:13] Speaker 05: That doesn't make sense in light of federal rule one. [00:44:17] Speaker 05: We were entitled to rely on the district courts holding. [00:44:19] Speaker 05: One other thing I'd like to raise is just that we believe sufficient evidence exists in the existing undisputed record, putting aside the FOM report. [00:44:28] Speaker 05: I just encourage the judges to read the Einer-Elhag report, both the initial report and the rebuttal. [00:44:35] Speaker 05: That report finds that Qualcomm's exclusivity agreements foreclose competition. [00:44:41] Speaker 05: It finds that it cobbled Intel's entry into the market by more than two years, which was the big failing that the FTC court found. [00:44:48] Speaker 05: And it found this on CDMA chips and LTE chips, which was the issue that my opposing counsel just identified. [00:44:55] Speaker 05: With respect to waiver. [00:44:56] Speaker 05: This is now going back to the issue of weak patents on the motion to dismiss sort of taking the first argument now second [00:45:05] Speaker 05: That issue was raised below. [00:45:07] Speaker 05: Again, I just encourage the judges to read. [00:45:09] Speaker 04: Okay. [00:45:09] Speaker 04: But was it raised in your appellate briefs? [00:45:11] Speaker 04: Because I mean, even I was a little bit caught off guard. [00:45:14] Speaker 04: Now, doesn't mean I didn't miss something. [00:45:16] Speaker 04: It's possible. [00:45:17] Speaker 04: But I was not prepared for what you said at oral argument based on the briefing that you'd given us. [00:45:23] Speaker 04: That suggests to me that it wasn't [00:45:25] Speaker 04: raised directly in the in your appellate briefs? [00:45:29] Speaker 05: Perhaps not directly. [00:45:30] Speaker 05: I mean, I thought that we had captured the concept in the following way. [00:45:33] Speaker 05: We were arguing that there had in fact been that kind of competition and that the court erred in that regard in construing competition so narrowly. [00:45:42] Speaker 05: The second way, and I know Qualcomm's counsel said this, that Judge Corley's only holding was that there was no competition in the tide market. [00:45:50] Speaker 05: That wasn't her only holding when it came to the tying claim. [00:45:52] Speaker 05: She also said, based on the FTC finding, that the mere imposition of a superfran charge in the tide market, in violation of the standard setting obligations, [00:46:02] Speaker 05: is not an antitrust concern, right? [00:46:05] Speaker 05: And that's based on the FTC Falcom decision. [00:46:07] Speaker 05: But we say the California court would come out differently on that because it's an abuse of the patent, right? [00:46:14] Speaker 05: So that would be tantamount to restraining competition in the tide market. [00:46:18] Speaker 05: Now this issue of, well, only Qualcomm can use Qualcomm SEPs. [00:46:22] Speaker 05: Again, that's just a super narrow focus on what the market is. [00:46:26] Speaker 05: It'd be like saying, let's imagine a tie in the chicken market where, you know, you buy water and then you have to buy Foster Farms chickens, right? [00:46:35] Speaker 05: It's like Foster Farms saying, [00:46:37] Speaker 05: Breweries don't market other than Foster Farms chickens, because only Foster Farms makes Foster Farms chicken. [00:46:41] Speaker 05: There are other substitutable chickens. [00:46:43] Speaker 05: And so construing the market in a way that creates a monopoly in sort of a circular reasoning, right, is to say, well, there can't be any competition for Qualcomm SEPs because only Qualcomm can have those SEPs. [00:46:54] Speaker 05: That is an exceedingly narrow definition of competition and one that we believe California courts would not accept. [00:47:01] Speaker 05: I think I'm out of my time, but I'm happy to answer any additional questions from the judges if they would indulge. [00:47:09] Speaker 00: Yeah, I have no questions. [00:47:12] Speaker 05: Thank you very much, Your Honors. [00:47:16] Speaker 00: Thank you, Council. [00:47:17] Speaker 00: Thank you, Your Honors. [00:47:24] Speaker 00: Okay, I think we heard from both, Council, done excellent jobs. [00:47:32] Speaker 00: It's a challenging case. [00:47:34] Speaker 00: The case will now be submitted, and the parties will hear from us in due course. [00:47:39] Speaker 05: Thank you, Your Honor. [00:47:45] Speaker 00: Thank you.