[00:00:00] Speaker 04:
Mr. Clement.

[00:00:01] Speaker 03:
Thank you, Your Honors, and may it please the Court, Paul Clement for CERBA, Inc., and I'm going to endeavor to reserve three minutes for rebuttal.

[00:00:17] Speaker 03:
Inc's constitutional standing is clear and indisputable.

[00:00:21] Speaker 03:
As the entity actually practicing the patents and directly competing with VMware, Inc's injury, in fact, is indisputable.

[00:00:28] Speaker 03:
Indeed, the district court ordered a new trial because it thought the jury had heard too much about Inc's distinct injuries.

[00:00:35] Speaker 03:
In a post-Lexmark world, that conclusion is utterly incompatible with the court's finding that Inc lacked constitutional standing.

[00:00:42] Speaker 04:
Can I ask a number of questions?

[00:00:44] Speaker 04:
But can I just start with,

[00:00:46] Speaker 04:
the aspect of Supreme Court constitutional standing cases that seems to

[00:00:53] Speaker 04:
continue to recite a notion of judicial cognizability or legally protected, sometimes in passing in a way that doesn't make the decision that the court is making turn on that.

[00:01:10] Speaker 04:
But at least once last year, not.

[00:01:12] Speaker 04:
That is not indicted, namely the refusal to allow

[00:01:18] Speaker 04:
Texas and other states to file their election law challenge in December, which in one sentence says the motion to leave to file is denied for lack of standing under Article 3 of the Constitution.

[00:01:31] Speaker 04:
Texas has not demonstrated a judicially cognizable interest in the manner in which another state conducts its elections.

[00:01:39] Speaker 04:
That's the entirety of the analysis.

[00:01:41] Speaker 04:
But it doesn't say no injury, in fact, it says judicial cognizability, which suggests there's some life in that notion.

[00:01:48] Speaker 04:
I'd like you to explain what that life is.

[00:01:51] Speaker 03:
Well, a couple of things, Your Honor.

[00:01:52] Speaker 03:
First, that would be, I think, a difficult opinion to define too much from.

[00:01:58] Speaker 03:
But second, with that preface, I would say that judicial cognizability

[00:02:04] Speaker 03:
I don't think has disappeared.

[00:02:05] Speaker 03:
And I think it might still have some legs as a doctrine of prudential standing or in the context of that Texas case.

[00:02:15] Speaker 03:
I suppose there almost might have been a political question, doctrine, flavor to that.

[00:02:19] Speaker 03:
So I think in that case, I'm not that surprised that the court might have whipped out a reference to judicial cognizability.

[00:02:28] Speaker 03:
But I don't think that you...

[00:02:32] Speaker 03:
You know, I mean, I think it was Justice Ginsburg in the contract against Ryan, maybe, who said, you know, jurisdiction is a term of many meanings, maybe too many meanings, and we've sometimes been loose about how we refer to it.

[00:02:44] Speaker 03:
And I think, I wouldn't be surprised if you can point me to another reference in a case to cognizable injury.

[00:02:51] Speaker 03:
But I don't think there is a post-Lexmark Supreme Court decision where they point to cognizable injury as a component of the core Article III injury and then fault a party for... I thought some of the references like in the Affordable Care Act case California against Texas and also TransUnion

[00:03:11] Speaker 04:
do recite legally protected or traditionally cognizable or legally cognizable, I sort of understand those three things as being the same, and as something additional to injury, in fact, caused by the bad conduct and the... I don't think they are saying that with the conscious idea that by saying that, something turns on you.

[00:03:36] Speaker 03:
And I think trans-union is a perfect example.

[00:03:38] Speaker 03:
I mean, the whole point of that case, as Your Honor no doubt knows,

[00:03:41] Speaker 03:
was to point out that a statutory injury, legally cognizable, I think is what you'd often talk about when you have a statutory injury like that.

[00:03:52] Speaker 03:
So they had legal cognizability out in large measure.

[00:03:57] Speaker 03:
But the problem was they didn't have injury in fact.

[00:04:00] Speaker 03:
And so I can't imagine that Justice Kavanaugh in writing that opinion

[00:04:04] Speaker 03:
whatever loose language you might have used, meant to say that the injury in fact requirement is something more than injury in fact, and that there is a subset.

[00:04:14] Speaker 04:
But I guess I understood your position to be that there is nothing to the Article III test beyond satisfying injury in fact, causation and redressability.

[00:04:26] Speaker 04:
And since INC has all of that, constitutional standing exists, and everything else has been waived.

[00:04:32] Speaker 03:
I think that's a fair summary of our position, and I think that's a fair summary of where the court is, both this court and the Supreme Court, whenever it focuses on it.

[00:04:43] Speaker 03:
I think when the court's not focused like a laser beam on the issue, it reverts to, I mean, you know, I recently read a dissent from one of the members of this court that used a whole bunch of pre-Lexmark, pre-Lone Star, pre-Schwindemann language about standing, but I don't think much turned on it.

[00:05:01] Speaker 03:
And so I don't think, you know, I mean, and that's part of why I think mandamus is so important here is because, you know, with respect for decades, this court had conflated

[00:05:13] Speaker 03:
the Article III requirements and the statutory prerequisites of 281.

[00:05:17] Speaker 03:
And so it's not surprising that district courts continue to conflate them.

[00:05:23] Speaker 03:
I don't even think it's an accident that it's the judges who maybe had the most experience with patent cases under the Ancien Regime who were the ones that are maybe most likely to continue making the mistake.

[00:05:34] Speaker 03:
But it is a mistake.

[00:05:35] Speaker 00:
So you mentioned TransUnion.

[00:05:37] Speaker 00:
In that case, I noticed that the court talked about this.

[00:05:41] Speaker 00:
There's some language in there that was interesting, talking about any physical, monetary, or cognizable, intangible harm traditionally recognized as providing a basis for a lawsuit in American courts.

[00:05:51] Speaker 00:
And I was thinking about that language traditionally recognized as providing a basis.

[00:05:56] Speaker 00:
But if your harm is competition, then how is that a traditionally recognized

[00:06:05] Speaker 00:
basis for a lawsuit, let me try and explain further.

[00:06:11] Speaker 00:
So if you have exclusionary rights,

[00:06:14] Speaker 00:
then there's competition.

[00:06:17] Speaker 00:
Because someone is using your exclusionary rights, that seems to be a harm traditionally recognized as providing a basis.

[00:06:23] Speaker 00:
On the other hand, a harm that comes from not having exclusionary rights, but someone is competing with you nonetheless, is not usually something that's kind of injury that would traditionally be recognized.

[00:06:36] Speaker 00:
I just wanted to get your thoughts on that.

[00:06:38] Speaker 03:
Sure.

[00:06:39] Speaker 03:
And I think I would just disagree with you.

[00:06:41] Speaker 03:
I think if you broaden the lens outside the patent context, competitive harm is one of the classic Article III injuries, like losing part of Blackacre or something.

[00:06:51] Speaker 03:
If this were an antitrust suit and we in VMware were a monopolist and we sued them for monopolistic behavior and part of the monopolistic behavior was infringing patents,

[00:07:03] Speaker 03:
I mean, it would be our loss of competition that would be the basis for Article III standing.

[00:07:08] Speaker 03:
It wouldn't matter whether we were an exclusive license, if we were bringing a common law action in federal court on diversity, when we would still need to have Article III injury, if we were bringing an unfair competition action.

[00:07:19] Speaker 03:
I mean, as the name of the tort suggests, the classic Article III injury in that context is a loss of injury.

[00:07:26] Speaker 03:
Monetary injury, of course, is another sort of classic Article III injury, which we have certainly suffered.

[00:07:32] Speaker 03:
It's so classic that, of course, the whole doctrine of when equity jurisdiction takes over is when you don't have an adequate remedy of law.

[00:07:40] Speaker 03:
And simply, monetary damages, monetary injury is a classic legal injury.

[00:07:45] Speaker 00:
So what about?

[00:07:47] Speaker 00:
just hypothetically, if there was a third party and it had an acceptable non-infringing alternative that it made, and could it sue for patent infringement where VMware was no longer practicing the patent, but it would have an economic benefit

[00:08:06] Speaker 00:
if VMware was not able to practice the patent, because it sells an acceptable non-infringing alternative, and it's harmed by the competition from VMware.

[00:08:19] Speaker 03:
So I think you asked, Your Honor, would they have standing to bring a patent action?

[00:08:25] Speaker 00:
Under for service patent.

[00:08:26] Speaker 00:
They don't own service patent.

[00:08:28] Speaker 03:
Right.

[00:08:29] Speaker 00:
But the reason I want to restate the question... I just am asking because you're

[00:08:33] Speaker 00:
your view of injury is very broad.

[00:08:36] Speaker 00:
And so I'm just testing it.

[00:08:38] Speaker 00:
And under your view of injury, I'm wondering whether someone who creates an acceptable non-infringing alternative and competes with both CERBA and VMware would have standing or at least be injured.

[00:08:51] Speaker 03:
So if I'm understanding the hypo right,

[00:08:53] Speaker 03:
I think the answer is yes.

[00:08:55] Speaker 03:
The reason I wanted to sort of, because even the way you formulated the question, I think actually encompasses both Article 3 standing and maybe a statutory question.

[00:09:05] Speaker 03:
And on the statutory question, it might be a loser.

[00:09:07] Speaker 03:
But you said, do they have standing to bring a patent case?

[00:09:10] Speaker 03:
And with all due respect, I don't even think that's the right question.

[00:09:12] Speaker 03:
The question is, do they have Article 3 injury?

[00:09:15] Speaker 03:
And the answer is yes.

[00:09:17] Speaker 00:
On the merits.

[00:09:19] Speaker 00:
And maybe that seems odd to you and I think if it seems odd to you it's only because of one of two things.

[00:09:35] Speaker 03:
One is that claim would be a loser on the merits based on the fact that they're suing on the wrong patent or there's no infringement or whatever the basis is for that to be a dead bang loser on the merits as a statutory matter.

[00:09:48] Speaker 03:
That may make it seem counterintuitive to you or it could be just because there's like three or four decades of these cases that conflate the two.

[00:09:56] Speaker 03:
But with all respect, I think it's standing, Article 3 standing is trans-sustaining.

[00:10:02] Speaker 03:
So even to say,

[00:10:04] Speaker 03:
Well, is there Article III standing to bring a patent claim?

[00:10:08] Speaker 03:
Is, with all due respect, not right.

[00:10:11] Speaker 03:
It's just the question, is there Article III standing?

[00:10:13] Speaker 03:
And if there is, we can talk about all the statutory prerequisites, and we can bring B6 motions, and we can deal with issues of waiver and the like under B6, but not B1.

[00:10:23] Speaker 00:
I understand.

[00:10:23] Speaker 00:
Your point is that all of that is taking care of the statutory or prudential standing.

[00:10:28] Speaker 00:
Absolutely.

[00:10:30] Speaker 00:
Absolutely.

[00:10:30] Speaker 00:
What about the fact that Judge Stark three times said that he did not think that VMware had waived its argument regarding prudential standing?

[00:10:42] Speaker 03:
So, I mean, we disagree with him on that.

[00:10:45] Speaker 03:
And I think if you look, for example, at a place I ask you to look is appendix page 370, where the legal authority for VMware's argument about standing is presented.

[00:10:56] Speaker 03:
There's a reference to B1, not B6.

[00:10:58] Speaker 03:
There's a reference to subject matter jurisdiction, not failure to state a claim.

[00:11:01] Speaker 03:
And there are three separate references on that one page to constitutional standing.

[00:11:05] Speaker 03:
It's one reference to prudential standing, and it never sort of sees the light of day again.

[00:11:08] Speaker 03:
And of course, Judge Stark is emphatic that he's ruling on constitutional standing.

[00:11:13] Speaker 03:
But I do want to be equally emphatic that it really doesn't matter.

[00:11:17] Speaker 03:
I mean, at this juncture, because we were poured out of court and dismissed as a party to this lawsuit because we lacked Article III injury.

[00:11:26] Speaker 03:
That's his holding in his order dismissing us as a party.

[00:11:32] Speaker 03:
Now, that's just wrong.

[00:11:33] Speaker 04:
And it's mandamously wrong, if you can... On the assumption, which I know you disagree with, you just said you disagree with, that any kind of lack of statutory right to be a plaintiff here was preserved, why should we not affirm on the ground that you didn't belong as a statutory matter for exactly the reasons that

[00:12:02] Speaker 04:
he that Judge Stark relied on for that he relied on but under the constitutional label at least initially.

[00:12:13] Speaker 04:
What practical difference is there?

[00:12:14] Speaker 04:
Don't worry about the clock.

[00:12:15] Speaker 03:
Okay.

[00:12:17] Speaker 03:
I have two responses.

[00:12:18] Speaker 03:
One, it shows you the practical difference, but the other is

[00:12:21] Speaker 03:
Of course, we think that we have an exclusive license, because that's what section two of the licensing agreement says.

[00:12:28] Speaker 04:
Assume that away.

[00:12:30] Speaker 03:
Okay, then assume that away, which of course I hate to do, but assume that away.

[00:12:34] Speaker 03:
It still makes a world of difference because if it's statutory, if we have a statutory prerequisite problem, but not an Article III problem, we're still a party to the case.

[00:12:43] Speaker 03:
We can fix the standing problem.

[00:12:47] Speaker 03:
We can fix the standing problem by retroactively reforming the contract to reflect the party's intent.

[00:12:54] Speaker 03:
We can do that.

[00:12:54] Speaker 03:
We can then seek a preliminary injunction before this retrial happens in 2023.

[00:12:59] Speaker 03:
And we can get ourselves back in the case.

[00:13:02] Speaker 03:
So there's a huge difference between statutory standing and Article III standing.

[00:13:10] Speaker 03:
You know, I don't think any of this turns on policy arguments, but I do think getting this right and making clear that this is, if there's any problem here, it's a statutory problem and not an Article 3 problem.

[00:13:20] Speaker 03:
It has a huge policy benefit, which is it makes some of these defects in licensing agreements and the like, it makes them fixable.

[00:13:29] Speaker 03:
If they're statutory, they're fixable.

[00:13:31] Speaker 03:
That's the lesson of Schwindleman.

[00:13:33] Speaker 03:
The problem there was fixable because it was only statutory.

[00:13:38] Speaker 03:
Judge Raina in dissent said, no, it's Article III, so it's not fixable.

[00:13:42] Speaker 03:
And with all due respect, as a generalist who doesn't understand all of the subtleties of some of these exclusive license things, I mean, I read this license and I think, wow, it grants an exclusive license.

[00:13:54] Speaker 03:
Game over.

[00:13:56] Speaker 04:
Unless the standard for having the statutory right to sue is not properly described as having an exclusive license, but rather having an exclusionary right, namely a right

[00:14:08] Speaker 04:
to exclude others by going after those others.

[00:14:12] Speaker 04:
And then the question would be whether you don't have any proprietary rights portion takes away what would otherwise be a corollary exclusive license by itself.

[00:14:25] Speaker 04:
That's what I took to be Judge Stark's view of this license.

[00:14:29] Speaker 03:
Sure.

[00:14:30] Speaker 03:
And I find that baffling

[00:14:34] Speaker 03:
I mean I'm I'm just you know a humble generalist.

[00:14:36] Speaker 03:
I find that conclusion baffling because Section 2 gives us

[00:14:41] Speaker 03:
gives Inc an exclusive transferable license, worldwide license.

[00:14:45] Speaker 04:
To practice.

[00:14:47] Speaker 03:
Sure, but it's transferable.

[00:14:48] Speaker 03:
That's granting a patent right.

[00:14:50] Speaker 03:
That's a clear, but I digress.

[00:14:52] Speaker 04:
Title 35 in patent protection doesn't give anybody the right to practice anything.

[00:14:57] Speaker 04:
It gives them only a right to exclude others.

[00:14:59] Speaker 04:
That's what 154 says.

[00:15:01] Speaker 04:
So the fact that you have a right to practice, and you're the only one, and you have a promise that you will be the only one,

[00:15:08] Speaker 04:
does not automatically mean it's a 154 right.

[00:15:11] Speaker 04:
There's been a long-standing sort of moral-based implication that in the absence of anything else, it carries the right to go and exclude others.

[00:15:21] Speaker 04:
But this provision, this no-proprietary rights provision, I understand Judge Stark to have said, that essentially wipes out the presumptive implication that one thing means the other.

[00:15:34] Speaker 03:
So two points, Your Honor.

[00:15:35] Speaker 03:
I mean, one is, I'll grant you all that.

[00:15:38] Speaker 03:
But again, as a generalist, the first principle of contract interpretation, the first principle of constitutional interpretation, it says it in Marbury, is you don't interpret one provision of a document to render another provision negatory.

[00:15:52] Speaker 03:
So I don't think that there's any problem with Section 8 and Section 2 coexisting and Inc.

[00:15:58] Speaker 03:
having an exclusive transferable license, which is after all what it says.

[00:16:02] Speaker 03:
And it seems if it's both exclusive

[00:16:04] Speaker 03:
And it's transferable, so I can essentially control whether I exclude somebody else by transferring them the license.

[00:16:11] Speaker 03:
Boy, that seems like more than enough to give you exclusionary rights.

[00:16:15] Speaker 03:
But if I'm wrong about that, and maybe I am, it seems like especially in a parent-sub relationship, where that is clearly what they intended, the ability to fix it after the fact, when it's pointed out,

[00:16:29] Speaker 03:
as opposed to have a whole lawsuit after eight citizens of Delaware have wasted their time in a trial and there's a $236 million verdict, to at that point sort of say, ah, you should have, you know, if you had only started section two with notwithstanding anything in section eight, then there'd be no problem at all.

[00:16:51] Speaker 03:
It seems to me, my only point here was that treating these things as statutory

[00:16:56] Speaker 03:
means they're fixable.

[00:16:57] Speaker 00:
Was there any attempt to fix it?

[00:16:59] Speaker 00:
I understand maybe not, because it was found to be a constitutional problem.

[00:17:03] Speaker 00:
But was there any proper suggestion that it would be fixed?

[00:17:09] Speaker 03:
We have taken the trouble to figure out how we would fix it.

[00:17:12] Speaker 03:
And I'm happy to proffer to you right now that we'll fix it today, we'll fix it tomorrow, if it's statutory.

[00:17:18] Speaker 03:
But we've been poured out of court for Article III injury.

[00:17:21] Speaker 03:
So because of that, there's no ability to fix it, and there's no point in fixing it.

[00:17:27] Speaker 03:
So, but we'd be happy to do it.

[00:17:29] Speaker 03:
I think a notwithstanding clause would do the trick myself.

[00:17:33] Speaker 03:
I don't even think we need that because, boy, I think an exclusive transferable worldwide license ought to convey exclusionary rights, particularly when it's granted by a subsidiary.

[00:17:45] Speaker 03:
I mean, if you take a step back, the context of this, is it all part of... Can I just point to the specific language?

[00:17:51] Speaker 02:
I understand what you're saying.

[00:17:53] Speaker 02:
And if we were just talking about language that said,

[00:17:56] Speaker 02:
exclusive transferable worldwide license, your argument would have a lot of force, I think, even with Clause 8.

[00:18:05] Speaker 02:
But the remainder of that sentence is to use the products, which suggests to me that it is a use license or a more limited license to use the products but not necessarily have any rights in the patent.

[00:18:21] Speaker 02:
I mean, that seems to me to be the plain reading of section two and section eight together is ink gets to use the patents, but the other company owns the patents.

[00:18:32] Speaker 02:
Now, I understand your argument is even if that's true, you want to fix it.

[00:18:36] Speaker 02:
But doesn't that seem to be I mean, that is the way I would read this license.

[00:18:43] Speaker 02:
And to me, that gives you statutory problems here.

[00:18:49] Speaker 03:
OK, again, I would

[00:18:51] Speaker 03:
If it turns on that subtlety, again, I think transfer the right to use is a right to grant patent rights to other people.

[00:19:00] Speaker 03:
To use.

[00:19:01] Speaker 03:
To use, but that's one of the patent rights.

[00:19:03] Speaker 04:
No, no, no, it isn't.

[00:19:06] Speaker 04:
The patent statute does not give anybody a right to use anything.

[00:19:10] Speaker 04:
The patent statute gives only a right to exclude others from using it.

[00:19:14] Speaker 03:
Right, but if I have the exclusive worldwide right and it's transferable,

[00:19:19] Speaker 03:
I get to decide who's excluded and who's not.

[00:19:22] Speaker 03:
If I give you a transfer of this license, you can practice the patent.

[00:19:29] Speaker 04:
If I don't.

[00:19:30] Speaker 04:
If you don't want somebody else to practice, you don't get to decide whether they're excluded.

[00:19:36] Speaker 04:
The patent owner does.

[00:19:39] Speaker 04:
You can decline to enable them to, but you don't get to exclude them just because you have an exclusive license.

[00:19:49] Speaker 03:
I would understand that we would both get, because of this license, to forgive their infringement, which is part of an exclusionary right.

[00:19:57] Speaker 03:
And also what this court said in Lone Star is the other thing that gives you an exclusionary right is a right to essentially grant the ability to exercise the patent, which if it's transferable, it seems like it gives it to it.

[00:20:09] Speaker 03:
And that's my reading of the patent.

[00:20:12] Speaker 03:
I mean, that's my reading of the license.

[00:20:14] Speaker 03:
But in a sense, this colloquy makes my point, which is if it's this complicated,

[00:20:18] Speaker 03:
Isn't it a better world where it's fixable?

[00:20:22] Speaker 03:
So that if you point this out because you preserve it in 12b6 and somebody, especially in a parent sub-context where it's just incredibly easy to fix it.

[00:20:33] Speaker 03:
So somebody points it out.

[00:20:34] Speaker 04:
Is it incredibly easy to fix it without destroying whatever the tax or other benefits are of the reason that led to this kind of transfer into the sub-context?

[00:20:46] Speaker 03:
I am informed that the answer is yes.

[00:20:48] Speaker 03:
it's incredibly easy to fix this without undermining the tax consequences of this at all.

[00:20:54] Speaker 04:
And do you, what do you understand from Schwindleman are necessary preconditions for a retroactive fix by way of, was Schwindleman like a contract reformation case?

[00:21:09] Speaker 03:
Yes, contract reformation under Minnesota law and under Minnesota law.

[00:21:13] Speaker 04:
And do you understand here,

[00:21:15] Speaker 04:
This license is governed by Canadian-Ontario law.

[00:21:18] Speaker 03:
That's right.

[00:21:18] Speaker 04:
But nobody's made anything of any specific jurisdiction.

[00:21:21] Speaker 03:
Nobody's made anything that turns on that.

[00:21:23] Speaker 04:
But as a substantive matter, are there any preconditions for a retroactive fix under the reformation law?

[00:21:32] Speaker 03:
Not that I'm aware of.

[00:21:33] Speaker 03:
OK.

[00:21:34] Speaker 03:
And again, presumably,

[00:21:37] Speaker 03:
If you underscore that this is statutory, underscore that statutory defects are fixable, at least potentially, if the law allows, then we would fix it.

[00:21:48] Speaker 03:
And, you know, I'm sure my friends at VMware, if there's an argument made under Ontario law that it's not fixed or it's not retroactive enough, I'm sure they would be happy to make that argument.

[00:21:59] Speaker 03:
So we could have all of that, but right now we can't.

[00:22:02] Speaker 03:
Because we've been dismissed as a party to the litigation in CAS based on what seems to me to be a clear and indisputable error of what's required by Article III.

[00:22:13] Speaker 00:
In your briefing, you rely on Lone Star and Schwendeman and Lexmark.

[00:22:19] Speaker 00:
Do you have any other cases that support your view that there could be constitutional standing without exclusionary rights?

[00:22:29] Speaker 00:
In other intellectual property areas, I just

[00:22:32] Speaker 03:
Well, I mean, there are other cases, you know, under the, I mean, obviously Lexmark's trademark case, there have been, you know, the Supreme Court since then has decided that the registration requirement under the Copyright Act is merely statutory, it's not jurisdictional.

[00:22:47] Speaker 03:
So, but I think if you look at this from a generalist perspective as opposed to a patent-specific perspective,

[00:22:57] Speaker 03:
There are tons of cases.

[00:22:59] Speaker 03:
I mean, injury to a competitor, loss of market share, forced firing of your employees because you're having competitive disadvantages.

[00:23:08] Speaker 03:
All of that is the classic injury in fact.

[00:23:12] Speaker 03:
And so I think the only way that you could say that doesn't count here is by basically saying there's a special rule for Article 3 injury in fact in patent cases or intellectual property.

[00:23:25] Speaker 03:
cases.

[00:23:26] Speaker 03:
And with all due respect, that's kind of the opposite of the thrust of Lexmark and Schwindleman and Lone Star.

[00:23:34] Speaker 03:
And there's a broader, obviously, set of Supreme Court cases that sort of suggests that when it comes to something like Article III, you don't have special patent rules.

[00:23:44] Speaker 03:
Article III is Article III is Article III.

[00:23:46] Speaker 00:
So for a non-practicing entity?

[00:23:49] Speaker 00:
I would understand that their only injury could be their loss of their exclusive rights.

[00:23:54] Speaker 00:
It would be a different analysis.

[00:23:55] Speaker 00:
And you can have different kinds of injury for different parties.

[00:23:59] Speaker 03:
Yeah, absolutely.

[00:24:00] Speaker 03:
Absolutely.

[00:24:01] Speaker 03:
But if I could, I mean, I know I'm over time here, so I don't want to overstep.

[00:24:04] Speaker 04:
Begin to wrap up.

[00:24:05] Speaker 03:
Yeah, I'll begin to wrap up by finishing my answer to your question by saying, as sort of another kind of policy argument for this result being sensible, I mean, what Judge Stark

[00:24:17] Speaker 03:
envisions in the retrial is that IP will be a party, and he even said at one point, as a non-practicing entity.

[00:24:24] Speaker 03:
And you won't have the only entity that practices the patent and experiences the flesh and blood injuries in the case under his worldview.

[00:24:34] Speaker 03:
And that seems to be, especially if, and of course if there's a problem with the licensing agreement, we can fix it if it's statutory, but that seems like an odd result.

[00:24:43] Speaker 03:
And it seems to me like, you know, whatever is the case of a situation where you have a bear licensee and a thousand people are licensed under the patent, when you have parent-subsidier relationship, that you have the sole licensee, they are the only party practicing the patent, I mean, it's a bit odd to have a case without that party present.

[00:25:04] Speaker 03:
And if treating this as statutory,

[00:25:06] Speaker 03:
allows you to make sure that that happens and doesn't not happen because of some defect in the way the licensing agreement was written.

[00:25:15] Speaker 03:
That seems to me to be an affirmative virtue of our position.

[00:25:18] Speaker 03:
That's it, the rest of my remarks for the book.

[00:25:22] Speaker 04:
Thank you.

[00:25:42] Speaker 04:
Ms.

[00:25:42] Speaker 04:
Maynard.

[00:25:43] Speaker 01:
May it please the court?

[00:25:44] Speaker 01:
Diane Maynard for VMware.

[00:25:46] Speaker 01:
I'm going to address the reasons, the rule that CERBA, Inc.

[00:25:50] Speaker 01:
seeks is wrong.

[00:25:51] Speaker 01:
But mandamus should be denied here for three independent reasons in any event.

[00:25:56] Speaker 01:
First, they seek a new rule, a change in the law, not enforcement of a clear and indisputable right.

[00:26:04] Speaker 01:
Second, they forfeited the very question they present to this court, as Judge Stark found.

[00:26:09] Speaker 01:
And third,

[00:26:10] Speaker 01:
The answer to the question would not change INC's dismissal because Judge Stark found that VMware timely objected to INC's fair licensee status, regardless of the label of the challenge.

[00:26:23] Speaker 04:
Just on that last point, if Mr. Clement is right that his client could fix the problem, if it's a statutory problem, and indeed fix it retroactively, although I'm not sure his argument depends on this,

[00:26:38] Speaker 04:
then his client might be able to come back into the case.

[00:26:43] Speaker 04:
Wouldn't that be a consequence?

[00:26:44] Speaker 01:
So it's too late for INC to argue that they can fix this vis-a-vis the trial that's already happened, Your Honor.

[00:26:53] Speaker 01:
We put at issue whether or not INC had an exclusive license in the pretrial order, as Judge Stark recognized.

[00:27:02] Speaker 01:
And they came back and said, there are no facts to be tried about that.

[00:27:07] Speaker 01:
And they asked Judge Stark to put it off and decide it after the trial.

[00:27:11] Speaker 01:
And significantly, they agreed with us that if they were just a bare licensee, they would lack standing to sue.

[00:27:18] Speaker 01:
So they knew, and whether they thought it was constitutional or statutory, they knew that they had to prove that they were more than a bare licensee to prove their claim.

[00:27:29] Speaker 01:
And they chose two sophisticated entities

[00:27:31] Speaker 01:
to rest on the agreements and push the issue to after trial.

[00:27:35] Speaker 01:
They've affirmatively waived.

[00:27:37] Speaker 00:
It's your position that they would have had to have said, if there is no prudential standing here, we will agree that we cannot fix this agreement.

[00:27:49] Speaker 00:
That we will not even try to submit a new agreement or try to fix it.

[00:27:52] Speaker 00:
That's what you're saying.

[00:27:53] Speaker 00:
You're saying that they agreed that if the court found no statutory standing, that they would not take the time to fix their agreement.

[00:28:02] Speaker 00:
It seems like a little bit of a stretch, to be honest, with respect to just what they said, which was that we think it's not a bear license.

[00:28:11] Speaker 01:
I think I've made two points, Judge Stoll.

[00:28:16] Speaker 01:
One is that we joined issue on this question before the trial on whether or not they had an exclusive license or not.

[00:28:24] Speaker 01:
They said three things about that.

[00:28:27] Speaker 01:
One, please decide it after the trial.

[00:28:29] Speaker 01:
Two, there are no facts to be tried.

[00:28:31] Speaker 01:
That's at A363 and A364.

[00:28:34] Speaker 01:
And then four, they agreed that a bare licensee would lack standing.

[00:28:40] Speaker 01:
That's at A368.

[00:28:42] Speaker 01:
And so whether they have the burden to prove their infringement claim, and so whether it's a constitutional question, their licensee standing, or whether it's a prudential statutory standing question, they had the burden to prove it.

[00:28:55] Speaker 01:
and they affirmatively waived any opportunity to prove it on the facts which Reformation would require.

[00:29:01] Speaker 01:
And contrast this to Schwindleman.

[00:29:04] Speaker 04:
Okay, so what are the facts relevant to justifying a Schwindleman-like Reformation?

[00:29:11] Speaker 01:
Well, so in Schwindleman, as soon as her standing was challenged, she came in and said,

[00:29:19] Speaker 01:
I can reform it under Minnesota law.

[00:29:21] Speaker 01:
There's just a clerical error.

[00:29:23] Speaker 01:
I had legal title all along, and there's a clerical error in the right.

[00:29:27] Speaker 01:
That was her argument.

[00:29:30] Speaker 04:
This is quite important to me, so I don't want to go over this too quickly.

[00:29:36] Speaker 04:
Does the reformation standard require that something like a clerical error as opposed to, of course, we meant to do what this contract says, but boy, we didn't know the consequences.

[00:29:50] Speaker 04:
We really want a different contract

[00:29:52] Speaker 04:
than the one that fairly interpreted we currently have.

[00:29:58] Speaker 04:
And we're now going to create that different one retroactively because now that we understand the consequences, we clearly would have done the new one.

[00:30:10] Speaker 01:
Well, so in Schwindleman, this court addressed it under the state law that governed there, Minnesota law.

[00:30:17] Speaker 01:
This issue has never been, they've never explained how they could fix it here.

[00:30:22] Speaker 01:
This issue is like, it's like triple forfeited Judge Toronto.

[00:30:26] Speaker 01:
So they needed to raise it when we challenged their bare licensee status.

[00:30:31] Speaker 01:
If they wanted to prove something about their licensee status that went outside the documents or somehow fix the documents, then they needed to do that at the trial.

[00:30:41] Speaker 04:
Why is it a forfeiture of the opportunity to correct a consequence of an interpretation?

[00:30:54] Speaker 04:
when you limit yourself to saying this is actually an incorrect interpretation that's being proposed and we think that the right interpretation allows us to be here without change.

[00:31:07] Speaker 04:
Why doesn't the reformation possibility only ripen later in a way that would have to be raised?

[00:31:17] Speaker 01:
they never advanced it even in the district court after Judge Stark dismissed them.

[00:31:23] Speaker 01:
So they noted it in a footnote, but they never explained how they could fix it.

[00:31:27] Speaker 01:
He's asserted here that he's going to offer to this court on the extraordinary writ of mandamus how he can fix it under Canadian law.

[00:31:33] Speaker 01:
We've never heard that.

[00:31:34] Speaker 01:
And so this is not the form to do it.

[00:31:37] Speaker 01:
Whatever they might be able to do when they go back going forward,

[00:31:41] Speaker 01:
That's another issue, but nothing would undo their failure to prove it at this trial or the fact that INC stands dismissed.

[00:31:49] Speaker 01:
And we would argue and have arguments that it's law of the case that INC's dismissed.

[00:31:54] Speaker 01:
They had their chance to prove that they had more than exclusive license.

[00:31:57] Speaker 01:
They didn't do it.

[00:31:58] Speaker 01:
And it's too late for them to come in with these new theories now about fixing it.

[00:32:02] Speaker 01:
But in any event, whatever these hypothetical arguments might be that they have, that would be an issue for Judge Start going forward.

[00:32:09] Speaker 01:
But it's not going to undo the dismissal that's already happened.

[00:32:12] Speaker 04:
Let me just start over.

[00:32:14] Speaker 04:
I think I stepped on your answer to my own question.

[00:32:18] Speaker 04:
What are the prerequisites for a reformation

[00:32:22] Speaker 04:
let's assume under general contract reformation law.

[00:32:28] Speaker 04:
You referred to clerical error, which at least when I hear it means without exploring it, something much rarer than we understand now what this contract meant.

[00:32:41] Speaker 04:
It wasn't a transcribing error or something like that.

[00:32:45] Speaker 04:
It was, we didn't appreciate the consequences and we want to redo it.

[00:32:50] Speaker 04:
Does reformation cover that second possibility, which I have not stated with precision, but maybe.

[00:32:58] Speaker 01:
So I think this would present a question of Canadian law, maybe Ontario law.

[00:33:03] Speaker 01:
I don't purport to be an expert.

[00:33:05] Speaker 01:
I will tell you that in Schwindleman, what happened under Minnesota law was held to be OK was that the documents had basically a clerical error by the lawyer that filed the patent assignment.

[00:33:17] Speaker 01:
And what the district court found and this court affirmed was that the party's intent all along had been to file a different assignment attached to that, and the wrong number was on it, but there was evidence that it was things.

[00:33:27] Speaker 01:
So under Minnesota law, again, that was tried at the trial.

[00:33:32] Speaker 01:
after standing was challenged before the trial, or I guess it was in summary judgment proceedings, but she proved it on the facts when it was first challenged.

[00:33:40] Speaker 01:
And it's too late for them to do that here.

[00:33:42] Speaker 01:
We would argue that what they're trying to do here is effectively rewrite the agreement.

[00:33:47] Speaker 04:
The agreement... I mean, put in aside the triple forfeiture.

[00:33:54] Speaker 04:
why wouldn't the question whether what they propose to do, if they now try to do it, effectuates properly a retrospective cure be one for the district court to address?

[00:34:13] Speaker 01:
Well, I mean, we can fight about this all with the district court.

[00:34:18] Speaker 01:
It wouldn't be grounds to

[00:34:20] Speaker 01:
grant the extraordinary writ of mandamus, where the district court has done nothing but decide the arguments presented to him.

[00:34:28] Speaker 01:
They should have made these arguments in response.

[00:34:32] Speaker 01:
And so they did drop a footnote in their response to the judge's supplemental briefing request.

[00:34:39] Speaker 01:
And Judge Stark said they have waived arguments they didn't make.

[00:34:43] Speaker 01:
They should have forfeited arguments they didn't make.

[00:34:46] Speaker 01:
They should have raised these arguments.

[00:34:48] Speaker 01:
There was no good reason for them not to have made all these arguments they're making now sooner.

[00:34:52] Speaker 04:
I beg your pardon?

[00:34:53] Speaker 04:
Do you remember where the footnote is, what appendix page?

[00:35:20] Speaker 01:
A325 footnote 3.

[00:35:32] Speaker 04:
And what specifically is that referring to?

[00:35:36] Speaker 04:
A 281 statutory issue was not timely raised.

[00:35:38] Speaker 04:
Is that Serba's issue or your issue?

[00:35:42] Speaker 01:
So this is, I'm sorry, this is Serba's brief in response to the judge's dismissal order.

[00:35:49] Speaker 01:
And what they're saying is

[00:35:51] Speaker 01:
This isn't a constitutional issue.

[00:35:53] Speaker 01:
It's a statutory issue.

[00:35:55] Speaker 01:
And VMware didn't timely object.

[00:35:57] Speaker 01:
And if they had, we would have put in these issues.

[00:36:04] Speaker 04:
And Judge Stark has already like... And this is what Judge Stark was also referring to when in the transcript on the request to certify he said, one reason I don't think I'm going to certify is that I don't think the Federal Circuit could get to the question whether the Constitution

[00:36:24] Speaker 04:
permit standing even without exclusionary rights because sort of didn't timely make that argument to me?

[00:36:34] Speaker 04:
Or is this something different?

[00:36:36] Speaker 01:
In the new trial order, the first place he says in the new trial order is when he denies their motion for reconsideration.

[00:36:42] Speaker 01:
He basically says all of the arguments you're making now you should have made to me sooner and they are waived.

[00:36:48] Speaker 01:
And that was his independent first ground.

[00:36:51] Speaker 01:
So it wasn't like, I'm not going to look at Schwindlen.

[00:36:53] Speaker 01:
I'm not going to look at precedent.

[00:36:54] Speaker 01:
It was like, you didn't make any of these arguments to me.

[00:36:57] Speaker 01:
And then at A515, he explains that in great detail.

[00:37:01] Speaker 04:
But I want to understand what any of these arguments is.

[00:37:07] Speaker 04:
If any of the arguments is that he was saying the servant didn't make is limited to the argument that I can get by on Article 3 standing even if I don't have exclusionary rights, that's one thing.

[00:37:24] Speaker 04:
But did it have anything to do with if this is statutory, I can fix it?

[00:37:30] Speaker 01:
Well, so what I would say is, I mean, what he says in the language is they've waived

[00:37:35] Speaker 01:
They forfeited, or he says wait, but forfeited the arguments.

[00:37:38] Speaker 04:
We keep going back and forth.

[00:37:40] Speaker 01:
Someday we'll fix that.

[00:37:40] Speaker 01:
Forfeited the arguments based on Schwindleman.

[00:37:43] Speaker 00:
But the argument based on Schwindleman was, say, the first argument was, this is not a very license.

[00:37:49] Speaker 00:
Then Schwendeman was argued for the purpose of saying, even if it is a bear license, you don't have to have exclusive rights or exclusionary rights in order to have constitutional standing.

[00:38:01] Speaker 00:
That's what I understood the reliance on Schwendeman to be.

[00:38:04] Speaker 00:
Not necessarily making a reformation or argument that we could also engage in reformation like Schwendeman, right?

[00:38:12] Speaker 01:
So two points about that, and I think that the footnote that in this point, this is A324 to 325 is their supplemental brief after the dismissal.

[00:38:24] Speaker 01:
And it's in the section called VMware forfeited the 281 issue.

[00:38:30] Speaker 01:
And Judge Stark says, for pages, he explains this at 516 to 518, why we were timely raised, regardless of whether it's properly labeled,

[00:38:40] Speaker 01:
a constitutional issue or a statutory issue.

[00:38:44] Speaker 01:
And I think that's right.

[00:38:45] Speaker 01:
My point is, Judge Ronto, that we said before the trial, you are only a bear licensee.

[00:38:51] Speaker 01:
You lack an exclusive license.

[00:38:55] Speaker 01:
They said, we have an exclusive license, and they chose to rely only on the language of the agreements.

[00:39:01] Speaker 01:
That's where, if they had an alternative ground to defend their ability to bring the suit, because they agreed at that time before the trial that if they only had a bear license, they didn't have a patent claim, could not sue for patent infringement.

[00:39:15] Speaker 01:
They had to bring it at the trial, and it's now too late to do that.

[00:39:19] Speaker 01:
What they might be able to do when we go back and go forward, that raises a whole host of complicated questions that parties haven't argued.

[00:39:26] Speaker 01:
But he shouldn't be able to come here and get the extraordinary writ of mandamus when Judge Stark decided the questions presented to him.

[00:39:32] Speaker 01:
We debated these issues in the trial court about who forfeited what and who was timely.

[00:39:39] Speaker 04:
Right.

[00:39:39] Speaker 04:
At least for me, it was a little hard to follow.

[00:39:42] Speaker 04:
I mean, that's not your presentation here, but the sequence of exactly who was accusing whom of forfeiting what, I think both sides.

[00:39:49] Speaker 04:
But do you think Judge Stark ruled that, given his understanding of the license agreement, section two and section eight, assuming that ink would lack statutory standing,

[00:40:10] Speaker 04:
at the end of the day, yes, throughout the proceed, no, I'm not going to say this right, did he ever rule on the statutory question?

[00:40:19] Speaker 04:
Initially, obviously, in a footnote in his June ruling, he said, I'm only doing constitutional.

[00:40:24] Speaker 04:
Did he ever say, actually, my conclusion stands on the basis of the statute, and if so, where?

[00:40:31] Speaker 01:
Footnote four, A57 to 58.

[00:40:33] Speaker 01:
That's where Judge Start goes through

[00:40:44] Speaker 01:
responds to the arguments I was just pointing you to by Serba that VMware did not timely raise it.

[00:40:54] Speaker 01:
And he gives two reasons for why we timely raised it.

[00:40:58] Speaker 01:
He says, first, it's constitutional, and it can be raised at any time.

[00:41:01] Speaker 01:
And I do believe he's right that it's constitutional.

[00:41:04] Speaker 01:
But he says, in any event, given how quickly this case was litigated, we timely made an objection to their standing.

[00:41:15] Speaker 00:
But just to follow up on Judge Toronto's question, I agree that he very clearly says that it was raised timely, but I don't see where he actually says, and not only that, but there is no statutory standing here.

[00:41:30] Speaker 00:
He doesn't say that.

[00:41:31] Speaker 01:
Well, so two points.

[00:41:33] Speaker 01:
They've never contested.

[00:41:35] Speaker 01:
that they've never contested that they don't have statutory standing if they're a Bail Licensee.

[00:41:39] Speaker 01:
But I think that the implication Judge Stoll is the sentence, this is hung on, this footnote, and then the very next sentence.

[00:41:47] Speaker 01:
So the judge says, this is at the end of the discussion where the judge says, VMware was prejudiced at the trial and the outcome would have, high probability the outcome would have been different if I had dismissed ink before the trial.

[00:42:02] Speaker 01:
Service says it's untimely, but it's not.

[00:42:04] Speaker 01:
Because it's constitutional in any event, it's timely.

[00:42:07] Speaker 01:
Based on these conclusions, I grant a new trial.

[00:42:09] Speaker 01:
So he was saying, even if it's just a statutory standing, it's timely.

[00:42:15] Speaker 01:
Inc.

[00:42:15] Speaker 01:
shouldn't have been in this case.

[00:42:16] Speaker 01:
It prejudiced it, VMware.

[00:42:18] Speaker 01:
I'm granting a new trial.

[00:42:19] Speaker 00:
Okay.

[00:42:19] Speaker 00:
Can I ask you a different question?

[00:42:22] Speaker 00:
I just want to know, you had a lot of different discussions and reasons why we shouldn't grant the written year brief, and you spent a little bit of time explaining why it was your view that constitutional standing requires not just an injury, but a legally and judicially cognizable injury.

[00:42:38] Speaker 00:
I wanted to ask you, do you think that the lack of exclusionary rights has any impact on the analysis of causation or redressability?

[00:42:50] Speaker 01:
So I think, yes, I do.

[00:42:51] Speaker 01:
I mean, I think it would also fail causation or redressability.

[00:42:55] Speaker 01:
So the patent rights, as Your Honors were discussing with Mr. Clement, the right that the patent rights give is the right to exclude others.

[00:43:04] Speaker 01:
It's a limited right

[00:43:07] Speaker 01:
that's an exception to the background of market competition.

[00:43:11] Speaker 01:
As this court has rightly held for decades, you have to possess some of the exclusionary rights to sue for patent infringement.

[00:43:20] Speaker 01:
And we have gotten backed up too far, and I think I've forgotten your question.

[00:43:25] Speaker 00:
I really just wanted to know if you were relying on causation.

[00:43:28] Speaker 01:
Well, I think you can frame it either way.

[00:43:30] Speaker 01:
So I think you can also say, you know, in this court has sometimes looked at these kinds of issues as regressibility issues.

[00:43:36] Speaker 01:
But I think that most often this court has talked about it as Article 3, injury in fact.

[00:43:40] Speaker 01:
And to Judge Tronto's question,

[00:43:42] Speaker 01:
And in response to your colloquy with Mr. Clement, the Supreme Court has made clear since Lexmark that the possession of invasion of a legally protected right is part of the Article III injury in fact.

[00:43:53] Speaker 01:
And I would point the court to Justice Chief.

[00:43:55] Speaker 00:
I would say that I agree with Mr. Clement that some of her older cases probably

[00:43:59] Speaker 00:
are incorrectly phrased in view of Lexmark.

[00:44:02] Speaker 00:
So that's where I want to just know what your thoughts are on, you know, specifically, are there Supreme Court cases that we should be looking at on redressability and causation that might help us, you know, if we decide, you know, if we agree with Mr. Clement on injury, for example.

[00:44:19] Speaker 00:
I just want to make sure, I would like to know if you have specific cases or anything.

[00:44:23] Speaker 01:
I can't stand here and give you cases on redressability, but I would like to fight the premise of your question.

[00:44:28] Speaker 01:
which is, so in Gilby Whitford, the Chief Justice explains that Article 3's injury and fact requirement requires invasion of a legally protected interest, which is concrete and particularized.

[00:44:43] Speaker 01:
Some cases are focused on different pieces of that, but in Gilby Whitford, the failing of the plaintiffs there was that they didn't have invasion of a legally protected interest.

[00:44:54] Speaker 01:
in House of Delegates.

[00:44:55] Speaker 04:
Can you remind me what was the interest asserted and why was it not legally protected?

[00:45:01] Speaker 01:
Gilby Whitford was the packing and cracking redistricting police runner and so the individuals had to show that their districts were individually impacted and they didn't prove that and so they failed to show that they had a legally cognizable right.

[00:45:14] Speaker 01:
I would also point the court to Virginia House of Delegates where the court held that

[00:45:19] Speaker 01:
What the failing there was, the failure, this is also close like Mark, to show a legally cognizable injury.

[00:45:27] Speaker 01:
And that was the holding of the court.

[00:45:28] Speaker 01:
It was based on that prong of the Article III Injury Fact Test.

[00:45:31] Speaker 01:
And the Chief Justice in Gilly Whitford explains why this is part of the Article III case and controversy requirement.

[00:45:37] Speaker 01:
The invasion of a legally protected interest, which is concrete and particularized, is necessary to limit judges to the appropriate role of deciding, based on legal principles, claims of legal right.

[00:45:48] Speaker 01:
And a pecuniary private pecuniary interest is not enough to give you Article III injury and fact.

[00:45:55] Speaker 01:
Justice Scalia, who also wrote Lexmark, wrote Vermont Natural Agency Resource, Natural Agency, Agency Natural Resource, may have it backwards, the US Expo Stevens, and he explained that a plaintiff who, for example, had placed a wager on a lawsuit, the outcome of a lawsuit,

[00:46:14] Speaker 01:
would have a private economic interest in the outcome of that lawsuit, but would nevertheless not have an Article III injury in fact, because the private economic interest that you have has to be tied to the legal claim that you're asserting.

[00:46:29] Speaker 01:
And here, we're not mixing and matching 281.

[00:46:35] Speaker 01:
We're not talking about the statutory rear arms.

[00:46:37] Speaker 01:
We're talking about a level back from that, which is that the patent only gives a limited right

[00:46:43] Speaker 01:
to exclude.

[00:46:44] Speaker 01:
It gives a right to exclude others.

[00:46:47] Speaker 01:
If you don't possess any of the exclusionary rights, you have no invasion of legally protected interest when someone infringes it.

[00:46:57] Speaker 01:
Mr. Clement mentions Blackacre, but somebody who had an easement to walk across Blackacre couldn't sue someone else who walked across Blackacre

[00:47:07] Speaker 01:
for trespass.

[00:47:09] Speaker 01:
This is like suing on somebody else's property right this court has held for decades and it's correct and it's still correct under Supreme Court precedent that that is not Article 3 injury in fact.

[00:47:22] Speaker 01:
And so Judge Stark was correct to label it a constitutional failing but it's also a statutory failing because if they lack any

[00:47:31] Speaker 01:
rights under the patent, they also can't meet 281 and their claim fails for that reason as well.

[00:47:38] Speaker 04:
When I think Mr. Clement, I think when I asked him the question about why couldn't this be, I'm using that incorrectly in a mandamus context, but why couldn't we let Judge Stark's ruling stand on a statutory basis even if he was right about the Constitution?

[00:48:05] Speaker 04:
What I think he focused on, at least what was in my mind, was this disparity in the ability to fix the problem.

[00:48:16] Speaker 04:
Can you address that?

[00:48:17] Speaker 04:
Is there a disparity or what?

[00:48:20] Speaker 01:
I don't think so, Your Honor.

[00:48:21] Speaker 01:
This court's cases like Enzo that talk about the reason somebody can't grant an exclusionary right after they've backed, after they've sued, would go beyond just Article III concerns.

[00:48:33] Speaker 01:
that you can't artificially create possession of the right to sue somebody for infringement after the fact.

[00:48:40] Speaker 01:
So whatever they might be able to do going forward, that's a different question.

[00:48:45] Speaker 01:
We can fight about that below.

[00:48:46] Speaker 01:
But it wouldn't change what you can do here.

[00:48:50] Speaker 01:
Although I think if you agree with him about his Article III injury argument, which I do think is wrong, I think he's mistaken.

[00:48:57] Speaker 01:
And we're not seeking a patent-specific rule.

[00:49:00] Speaker 01:
We're seeking to apply the rule that applies transubstantively

[00:49:03] Speaker 01:
across all claims, which as the Chief Justice explained in Gill, is Article 3, injury in fact, requires invasion of a legally protected interest.

[00:49:12] Speaker 04:
So that turns this phrase, injury in fact, into something that actually looks at the underlying legal right and who is within its protection, which I guess maybe Justice Thomas is pressing these days as a reformation.

[00:49:28] Speaker 01:
Well, the Court has long said, like in cases like Worth v. Selden, they repeated that

[00:49:33] Speaker 01:
sense is that it that whether you have article 3 injury in fact Does turn on the nature and source of the claim?

[00:49:41] Speaker 01:
So it is something that you do look, because it is like if you look at Gill, if one looks at House of Delegates and the dissent in Gill, like the question is the match.

[00:49:52] Speaker 01:
Is there a right match between what you're claiming as your injury?

[00:49:55] Speaker 01:
And this is Justice Leah's point in the Vermont case as well.

[00:49:59] Speaker 01:
There has to be, you can't just come in and say, I'm harmed by this person's conduct and sue.

[00:50:04] Speaker 01:
For it to be a case of controversy, there has to be some tie between some legal invasion to your rights.

[00:50:09] Speaker 01:
And under the patent laws, if you don't have any of the rights to exclude, there's no legal invasion of your rights.

[00:50:16] Speaker 01:
So the norm is competition.

[00:50:19] Speaker 01:
So for someone who lacks any of the exclusionary rights.

[00:50:22] Speaker 04:
And what you just said, is that consistent with Schwenderman?

[00:50:27] Speaker 01:
Yes.

[00:50:27] Speaker 01:
So I think Schwindleman follows Lone Star.

[00:50:33] Speaker 01:
And Lone Star, back to a point you alluded to, I think Lone Star has already aligned this court's precedent with Lone Star.

[00:50:40] Speaker 01:
Lone Star said exclusionary rights remains Article III.

[00:50:47] Speaker 01:
That remains the constitutional minima.

[00:50:49] Speaker 01:
What we used to call prudential standing, which is can somebody join even though they don't have all of the exclusionary rights,

[00:50:57] Speaker 01:
They just have some.

[00:50:58] Speaker 01:
Do they need to join the patentee to their case?

[00:51:01] Speaker 01:
That part

[00:51:02] Speaker 01:
under Lexmark is more appropriately considered statutory standing or whatever one wants to label the non-article 3 requirements.

[00:51:08] Speaker 00:
With all due respect, I don't see where Lone Star says that you have to have exclusionary rights for constitutional standing.

[00:51:15] Speaker 00:
I think it says in that case the party had exclusionary rights so they had constitutional standing, but I didn't think it was saying this is the minimum that you must have in order to have constitutional standing.

[00:51:27] Speaker 00:
I don't think that question's been answered post Lone Star.

[00:51:31] Speaker 01:
So I would point you, Judge Stoll, so the court in Lone Star goes through the Article 3 standing section at 1234 in Section B.

[00:51:44] Speaker 01:
And then once it goes through, and it discusses at length this court's cases in Morrow and WIAV, which I think have really thoughtful discussions on why exclusionary rights are required in order to have Article III standing.

[00:51:57] Speaker 01:
And I think those cases clearly are talking about what's required.

[00:52:00] Speaker 01:
Because if you don't have any, because they're talking about, and the same with ortho, like if you don't possess any of the bundle of sticks that allows you to exclude, you don't have any invasion of

[00:52:11] Speaker 01:
a legally protected interest if somebody infringes.

[00:52:14] Speaker 01:
So after going through and discussing Article 3 standing and Morrow and WIAB, this court in Lone Star doesn't purport to say, okay, we now reframe all of that as statutory standing after Lexmark.

[00:52:29] Speaker 01:
Instead, on the top of page 1235 in the first full paragraph,

[00:52:34] Speaker 01:
The court says, although Lone Star Clear cleared this constitutional threshold, and I think that this constitutional threshold is the possession of exclusionary rights.

[00:52:44] Speaker 01:
And then it goes on to discuss, but because they have some, they shouldn't be dismissed for Article III standing.

[00:52:49] Speaker 01:
Let's decide whether we have to bring in the patentee.

[00:52:51] Speaker 01:
And then under Lexmark, all of that law is now statutory.

[00:52:56] Speaker 04:
OK, and now Schwindleman.

[00:52:57] Speaker 01:
And now there's Schwindleman.

[00:52:58] Speaker 01:
And Schwindleman says, we're following Lone Star.

[00:53:03] Speaker 01:
It says that it recounts Lone Star.

[00:53:06] Speaker 01:
It says that this first plaintiff alleges she has ownership rights.

[00:53:12] Speaker 01:
And then once it goes through this discussion, I think most of the discussion is about 261, and the debate between the dissent and the majority is about 261, which the writing requirement is clearly a statutory requirement.

[00:53:26] Speaker 01:
But I think in the end, the question of whether she was a patentee folded together with the question of whether she had exclusionary rights, because she either had all of them, and therefore she had exclusionary rights and cleared Article III, and she was a patentee, or she had none of them, and she wasn't either.

[00:53:47] Speaker 01:
serve up what they need.

[00:53:49] Speaker 04:
If that was a constitutional requirement, if Schwendeman kept what you said, in your view, Lone Star confirmed, namely, possession of at least some exclusionary right is a constitutional, then how does retroactive reformation work with a rule that constitutional standing must be possessed at the time of the filing of the court entry document?

[00:54:16] Speaker 01:
Well, what this court held was that she was the legal owner of the patents when she filed suit as a matter of Minnesota law, that she had been assigned the patents in 2002 before she filed suit, and that the writing requirement could be fixed after.

[00:54:38] Speaker 01:
And the writing requirement is clearly statutory.

[00:54:40] Speaker 01:
But I think the main takeaway, Judge Toronto, is that Schwindleman can't get CERBA a clear and indisputable right to relief here and to a holding what they want, because it clearly doesn't hold that a party with no exclusionary rights has Article III standing.

[00:54:57] Speaker 04:
And that's what Judge Stark has held here.

[00:55:03] Speaker 04:
standards which, as you know, are flexible for, I mean, sometimes flexible for mandamus when there is something of a mess causing somewhat widespread difficulty, which has happened before.

[00:55:20] Speaker 04:
We try, if we can, to clear up the legal analysis, even if

[00:55:27] Speaker 04:
What we're doing is almost by definition clearing up something that maybe wasn't so clear.

[00:55:32] Speaker 04:
Why should this not be one of those cases?

[00:55:35] Speaker 01:
I don't think this fits like the cases like the only micron and Google where this court has done it before for several different reasons.

[00:55:41] Speaker 01:
One, there's nothing like the widespread disagreement.

[00:55:44] Speaker 01:
that there was in those cases before this court decided.

[00:55:47] Speaker 04:
Isn't there substantial disagreement about this problem of fixing and retrospective fixing and whether it can be done at all, which I think at least some courts think, if it's a constitutional problem, it simply can't.

[00:56:05] Speaker 04:
Or do you think that maybe retroactive fixing, at least if the standards are what Schwindleman relied on, could retrospectively fix a constitutional problem?

[00:56:19] Speaker 01:
That's certainly not the divide that they have alleged in their petition, so I'm unaware of any such split, Your Honor.

[00:56:26] Speaker 01:
This isn't a case like T.C.

[00:56:27] Speaker 01:
Heartland, post-T.C.

[00:56:28] Speaker 01:
Heartland, where the Supreme Court has reversed one of this court's precedents, and there's clear divide, like straight across the board,

[00:56:35] Speaker 01:
There's only a handful of cases they cite.

[00:56:37] Speaker 04:
Don't they have a paragraph where there's, I mean, it's not like 25 cases or something in my crime, but don't they cite six or seven or something?

[00:56:46] Speaker 01:
Well, they cite cases, Your Honor, but I don't think those cases show any kind of clear divide on the question that they're trying to present to this court.

[00:56:53] Speaker 01:
So, but in any event, even if the court wanted to clear up this question, this is a terrible vehicle to do it.

[00:57:00] Speaker 01:
because they forfeited the issues they're trying to present here.

[00:57:04] Speaker 01:
So any sort of notion that you would clear that up is based on the idea that they should have told Judge Stark, instead of just responding on the terms about their license, they should have told Judge Stark that all these arguments they're making now, and they didn't, and he held that forfeited.

[00:57:17] Speaker 01:
And this court usually wouldn't review such a forfeited question even on a final judgment appeal.

[00:57:22] Speaker 01:
And it shouldn't reach out to decide it in this case.

[00:57:25] Speaker 01:
So we would request that this court

[00:57:28] Speaker 01:
deny the extraordinary relief of mandamus unless the court has further questions.

[00:57:48] Speaker 03:
Your honors, I'd like to make a couple of points in rebuttal, but I'm obviously guided by anything that's a continuing source of concern for you.

[00:57:54] Speaker 03:
Just to pick up on the last point you made, Judge Toronto, I think it's worth noting in this respect that even Judge Stark, in his 1292B motion, although he denied relief, recognized there was a substantial ground for difference of opinion on this issue, which I think underscores that there is widespread confusion, and this court could helpfully clarify it.

[00:58:14] Speaker 03:
To install, you asked about causation and redressability.

[00:58:17] Speaker 03:
And the reason that's not going to get the other side anywhere is because another point that I think VMware loses sight of is that the standing inquiry is supposed to be independent of the merits.

[00:58:28] Speaker 03:
There are dozens of Supreme Court cases that say that standing is independent of the merits.

[00:58:33] Speaker 03:
So I suppose you could say, well, even if you have injury in fact, since you don't have a good statutory claim, you're not going to really be able to redress it at the end of the case.

[00:58:42] Speaker 03:
But that's not the right way to think about it.

[00:58:43] Speaker 03:
And you essentially assume for standing purposes that the statutory claim or the legal theory is OK.

[00:58:49] Speaker 03:
And then you just ask, is there injury in fact?

[00:58:52] Speaker 03:
Is there causation and what they're complaining about?

[00:58:55] Speaker 03:
The defendant's conduct, is that what's causing the injury?

[00:58:58] Speaker 03:
And traceability and the rest.

[00:59:00] Speaker 03:
So I don't think that there's any problem there with causation or redressability.

[00:59:05] Speaker 03:
And I really think that's the key to deciding this case and providing clarity for the lower courts.

[00:59:11] Speaker 03:
Article 3 standing is trans-substantive.

[00:59:13] Speaker 03:
So if Inc.

[00:59:15] Speaker 03:
had standing to bring a common law unfair competition claim against VMware because it's lost 100 employees and because it's lost market share and it's had to lay people off, if that's Article 3 injury for a common law claim, which it certainly is, then it's good enough for a statutory claim no matter what the statute is.

[00:59:36] Speaker 03:
And then the second point to overlay on that, and you don't ask,

[00:59:39] Speaker 03:
Are they going to win at the end of the case?

[00:59:42] Speaker 03:
Or is there a statutory problem?

[00:59:43] Speaker 03:
You separate out the standing inquiry from the merits inquiry.

[00:59:46] Speaker 03:
And if you make that clear, then hopefully the lower courts will get the idea that even asking, is there Article III injury in a patent case?

[00:59:56] Speaker 03:
No.

[00:59:57] Speaker 03:
Is there Article III injury?

[00:59:58] Speaker 03:
There's three requirements.

[01:00:00] Speaker 03:
I think it's revealing, actually, that my friend who's very learned and knows the Supreme Court case very well

[01:00:05] Speaker 03:
But her example of a case where the court said something about cognizability was the Gill case.

[01:00:11] Speaker 03:
The next term they come around and say it's all a political question.

[01:00:14] Speaker 03:
I think that shows you that when the court is kind of playing around the margins, what's really a cause of action or political question, maybe they slip in the cognizable word.

[01:00:23] Speaker 03:
But when they're dealing with real old fashioned common law injuries, the loss of flesh and blood employees, the loss of market share, competitive injuries, that's just injury in fact.

[01:00:33] Speaker 03:
Those are the easy cases.

[01:00:34] Speaker 03:
And this should have been an easy case from the perspective of Article 3.

[01:00:39] Speaker 03:
I want to say a couple of things about forfeiture arguments.

[01:00:41] Speaker 03:
First of all, I think it's very unfair to say that my client forfeited its ability to object the statutory standing when they said, let's deal with this after trial, when if you look at appendix page 370, it is clear what we were being confronted with was an Article III objection to our standing.

[01:01:00] Speaker 03:
That's something we can't fix, and you can raise it at any time.

[01:01:03] Speaker 03:
So it's harmless to put it over until after the trial.

[01:01:06] Speaker 03:
Statutory issues are different.

[01:01:07] Speaker 03:
They have to be raised at trial.

[01:01:09] Speaker 03:
So if they had raised a statutory argument before trial, we would have said, let's bring it on.

[01:01:14] Speaker 03:
And if we lose on that issue, we can still fix it.

[01:01:17] Speaker 04:
Well, what do you mean by have to be raised at trial?

[01:01:22] Speaker 04:
If the question is whether under 281 or this person is a patentee entitled to sue under this statute, isn't that a... Does the judge decide that?

[01:01:37] Speaker 04:
Or if there are underlying facts, do the underlying facts like about what the agreements are and what they mean go to the jury?

[01:01:45] Speaker 03:
I think if there was a dispute over the underlying facts that were relevant for the statutory claim, I think that would go to the jury.

[01:01:51] Speaker 03:
But either way, it has to be preserved.

[01:01:53] Speaker 03:
I mean, there's no question.

[01:01:54] Speaker 03:
It's a statutory argument.

[01:01:55] Speaker 03:
It's a B6 argument.

[01:01:57] Speaker 03:
I think it's rule 12H1 says that those kind of statutory arguments have to be raised at a bare minimum at trial.

[01:02:05] Speaker 03:
And that makes sense, because if you think about this as a statutory claim, what it really is is a claim that

[01:02:10] Speaker 03:
Inc.

[01:02:11] Speaker 03:
and its evidence about damages, the jury shouldn't hear that because Inc.

[01:02:14] Speaker 03:
isn't really the injured party under the statute.

[01:02:17] Speaker 03:
That's a great argument to raise before the jury hears the evidence.

[01:02:20] Speaker 03:
But if you wait until after the trial, you can't raise it.

[01:02:23] Speaker 03:
It's too late.

[01:02:24] Speaker 03:
But if it's Article III, you can raise it after the fact.

[01:02:29] Speaker 03:
And even if you, I think that's why it's really unfair to say that we forfeited our objection to a statutory argument, because they never made a statutory argument, but it's also an illustration of why it's important to get this right.

[01:02:43] Speaker 00:
Can I ask you about that?

[01:02:45] Speaker 00:
I was looking at page A370 and 371, preparing for today.

[01:02:49] Speaker 00:
And I look and I see that on those pages, they talk about standing.

[01:02:54] Speaker 00:
Then they say standing is comprised of both constitutional and prudential components.

[01:02:59] Speaker 00:
And then they have some law about constitutional standing.

[01:03:02] Speaker 00:
And then they say prudential standing requires, among other things, blah, blah, blah.

[01:03:06] Speaker 00:
So there's different parts where they refer to

[01:03:09] Speaker 00:
both kinds of standing, both constitutional and credential.

[01:03:13] Speaker 00:
So I'm wondering, could you point me more specifically on why you think this is only raising constitutional?

[01:03:18] Speaker 00:
Because I'm reading it differently from you right now.

[01:03:21] Speaker 03:
Okay, well here's, if you go to the beginning of 370, they cite B1.

[01:03:26] Speaker 03:
They don't cite B6.

[01:03:27] Speaker 03:
And then they talk about the court's subject matter jurisdiction.

[01:03:30] Speaker 03:
They don't talk about failure to state a claim.

[01:03:33] Speaker 03:
And then there's three references to constitutional standing.

[01:03:36] Speaker 03:
There are what I take to be some loose references to potential standing.

[01:03:40] Speaker 03:
There's certainly no references to statutory standing or anything of the like.

[01:03:44] Speaker 03:
And keep in mind that Judge Stark in footnote one of his opinion dismissing us for lack of standing says it's a constitutional standing argument only.

[01:03:56] Speaker 03:
So he's reading these things the same way I am.

[01:03:58] Speaker 03:
And I think he reiterates that in footnote four, which you've already discussed.

[01:04:01] Speaker 03:
If I could just indulge with the court's indulgence, I do want to talk about the forfeiture issue with respect to whether somehow we forfeited the ability to say that even apart from exclusionary rights, we suffer Article III injury.

[01:04:13] Speaker 03:
There's three reasons that's not forfeited.

[01:04:16] Speaker 03:
One, you can't forfeit that kind of Article III argument at all.

[01:04:20] Speaker 03:
In the Lexmark case.

[01:04:21] Speaker 04:
Why is it different from the Affordable Care Act forfeiture of an affirmative ground for standing?

[01:04:26] Speaker 04:
You know what I mean?

[01:04:27] Speaker 04:
I'm not sure I do, because as I understand the only thing that happened... There was a severability, a non-severability argument for standing.

[01:04:35] Speaker 04:
Right.

[01:04:35] Speaker 04:
And the Supreme Court says, that's an affirmative basis for standing.

[01:04:41] Speaker 04:
You did not present that to us, and so we're going to disregard it and find no standing.

[01:04:46] Speaker 03:
So you can forfeit a basis for standing.

[01:04:49] Speaker 03:
What I understand the Supreme Court did there is they didn't say it's forfeited in the sense that your failure to preserve it

[01:04:55] Speaker 03:
would prevent you from raising it in this court if it were in the question presented.

[01:04:59] Speaker 03:
I read the court saying, you can't argue that now, because it's not in the question presented.

[01:05:03] Speaker 03:
And that's a special rule for the Supreme Court.

[01:05:06] Speaker 03:
And you can have an argument that's in the case, but if you didn't put it in the question presented, and the Supreme Court doesn't want to reach it that day, they're not going to reach it.

[01:05:13] Speaker 03:
And they're going to point to the question presented.

[01:05:15] Speaker 04:
Lexmark is the perfect- So the Supreme Court's remedy in that case would allow the Fifth Circuit or the District Court in that case to go back and say, oh, you do have standing after all?

[01:05:25] Speaker 03:
That probably can't be, but that has more to do with the fact that once that decision gets final 25 days and nobody files a rehearing petition, the case is over, I would think.

[01:05:34] Speaker 03:
But Lexmark is a better example.

[01:05:36] Speaker 03:
The Supreme Court went out of its way to say all the parties are talking about this prudential standing or statutory standing.

[01:05:42] Speaker 03:
And yet the court said Article III standing.

[01:05:45] Speaker 03:
In the Lone Star case, the allegation in the case, and the district court seized on this, was that the plaintiff in that case said they were a patentee.

[01:05:54] Speaker 03:
and didn't allege they had exclusionary rights.

[01:05:57] Speaker 03:
But in the Lone Star case, this court said, well, close enough.

[01:06:01] Speaker 03:
They have exclusionary rights, and that's good enough for Article III standing, even though the principal basis they argued below was as a patentee.

[01:06:11] Speaker 04:
You just can't... And you don't think 370 is close enough on their side?

[01:06:16] Speaker 03:
I don't think it does because I think it's an example of where

[01:06:22] Speaker 03:
The difference between constitutional and statutory arguments have big differences.

[01:06:28] Speaker 03:
Because when they're raising a constitutional argument in hot verba, constitutional standing, our reaction to that on the eve of trial is nothing we can do about it.

[01:06:40] Speaker 03:
And it's the kind of issue you can raise at any time in the case so there's no problem with kicking it to after the trial.

[01:06:46] Speaker 03:
Whereas, if it's statutory,

[01:06:49] Speaker 03:
We would be saying, let's fix it.

[01:06:51] Speaker 03:
Let's address it so we can fix it.

[01:06:53] Speaker 03:
And we would also be saying, and it's got to be preserved at trial.

[01:06:56] Speaker 03:
The rules say that.

[01:06:58] Speaker 03:
Did I just get my two other reasons?

[01:07:00] Speaker 03:
I can't forfeit this kind of argument at all.

[01:07:05] Speaker 03:
But equally importantly, this is just an argument.

[01:07:09] Speaker 03:
Yeevy City of Escondido, the parties below only raised a physical taking argument.

[01:07:14] Speaker 03:
And yet the Supreme Court allowed them to raise a regulatory taking argument.

[01:07:18] Speaker 03:
This is far less aggressive.

[01:07:19] Speaker 03:
We made one argument for why we have Article III standing.

[01:07:22] Speaker 03:
We'd like to make a second one.

[01:07:23] Speaker 03:
And the last point is we did timely raise this.

[01:07:26] Speaker 03:
The sequence of this is important.

[01:07:28] Speaker 03:
Judge Stark first dismissed this as a party.

[01:07:31] Speaker 03:
He then asked for supplemental briefing on the effects of that order and whether it required a new trial.

[01:07:36] Speaker 03:
And that's the point at which we said before he ordered a new trial.

[01:07:41] Speaker 03:
We said, wait a second, you're wrong.

[01:07:43] Speaker 03:
This is only statutory.

[01:07:45] Speaker 03:
It's not constitutional.

[01:07:47] Speaker 03:
In the footnote that my friend averted to, we said, it's just statutory, and we can fix it.

[01:07:52] Speaker 03:
And we also said, it's just statutory, and so you don't need a new trial.

[01:07:55] Speaker 03:
And he said, I disagree.

[01:07:57] Speaker 03:
You're wrong.

[01:07:57] Speaker 03:
It's just constitutional.

[01:07:59] Speaker 03:
I'm going to order a new trial.

[01:08:00] Speaker 03:
That should be fixed.

[01:08:01] Speaker 03:
Thank you.

[01:08:02] Speaker 04:
Thanks to both counsel.

[01:08:04] Speaker 04:
Cases submitted.