[00:00:00] Speaker 04:
Our next case for argument is 22-1873, Syntek Company versus Chilison Electronic Corporation.

[00:00:09] Speaker 04:
Mr. Lamberson, please proceed.

[00:00:12] Speaker 01:
Good morning, Your Honors, and may it please the Court.

[00:00:16] Speaker 01:
The judgment of infringement entered by the District Court below should be reversed.

[00:00:22] Speaker 01:
under either of the two claim constructions at issue here, either the district court's construction or Chilison's proposed construction, there has to be a causal relationship between the hardness difference in an accused product and the formation temperature.

[00:00:39] Speaker 01:
And syntax expert Dr. Cole was asked on cross-examination, how would you show that causal difference?

[00:00:46] Speaker 01:
And he said you would have to do that through experimentation.

[00:00:50] Speaker 01:
Cintek and its expert, however, did no such experimentation here.

[00:00:54] Speaker 01:
They tested two aspects of the accused products.

[00:00:57] Speaker 01:
What was the size of the particles in those products, and what was the hardness?

[00:01:02] Speaker 02:
What intrinsic evidence would you point us to to require that the hardness difference have more than an impact?

[00:01:09] Speaker 02:
It must instead be like a but-for-cause or something like that.

[00:01:11] Speaker 01:
Certainly.

[00:01:13] Speaker 01:
So it's throughout the intrinsic record.

[00:01:18] Speaker 01:
If we look at the 312 patent as an example.

[00:01:24] Speaker 02:
You can just give me your best one.

[00:01:26] Speaker 01:
What's that?

[00:01:27] Speaker 02:
You can just give me your best.

[00:01:28] Speaker 02:
You said it was throughout.

[00:01:29] Speaker 01:
You can just give me the best.

[00:01:30] Speaker 01:
Well, then I would probably start with the file history, which is an originally filed appendix.

[00:01:38] Speaker 01:
where it's clear that what they're purporting to claim here, the patent describes two different features that could potentially impact the formation temperature.

[00:01:51] Speaker 04:
What page of the prosecution history would you like us to look at?

[00:01:56] Speaker 01:
17389.

[00:01:57] Speaker 01:
So you have two potential variables you could change according to this patent.

[00:02:01] Speaker 01:
And they, of course, chose to put only one of those variables into the claim.

[00:02:06] Speaker 03:
This is the very last page of the second diagram of the appendix.

[00:02:09] Speaker 01:
That's correct.

[00:02:12] Speaker 01:
And I should say, in the supplemental appendix, there is a fuller version.

[00:02:17] Speaker 01:
This is the critical page.

[00:02:19] Speaker 01:
So that's why I pointed to this one.

[00:02:21] Speaker 01:
And what they're saying here to the patent office is that it is the hardness difference that you adjust.

[00:02:27] Speaker 01:
They use the word corrected.

[00:02:29] Speaker 01:
And that's that's what that's what adjusts the or corrects the temperature to get to this melting point below the melting point of the wire and that's all the suggesting that nothing else can have an impact or you suggesting that This has to have a mean impact.

[00:02:50] Speaker 03:
I just want to make sure I understand.

[00:02:51] Speaker 01:
Yes our proposed

[00:02:54] Speaker 01:
Our proposed construction is what was proposed below at, for example, 2737 of the appendix, which is that you couldn't achieve this formation below the melting point without the hardness difference.

[00:03:06] Speaker 01:
So it is a causation.

[00:03:07] Speaker 01:
And this is also actually what Syntex said below as well.

[00:03:11] Speaker 01:
If you look at 4510 of the appendix, which is their opposition brief, they wrote the causal relationship.

[00:03:18] Speaker 04:
Well, I guess I'm struggling because what you just said seems consistent with what

[00:03:24] Speaker 04:
construed, the hardness difference has to be part of the causation inquiry, but it doesn't have to be the exclusive causation inquiry.

[00:03:34] Speaker 04:
So what's wrong with that view?

[00:03:39] Speaker 01:
What's wrong with that view is that, well, there's two things wrong with that view.

[00:03:42] Speaker 01:
First of all, when we talk about causation, it is the idea that you can't achieve, the effect would not happen if not for the cause.

[00:03:53] Speaker 01:
That is what causation means.

[00:03:54] Speaker 01:
And the district court did say, in its opinion at 7147, that these patents do teach a causal link.

[00:04:01] Speaker 01:
Where the district court erred was when it wrote, the causal link is between hardness and a lower temperature.

[00:04:08] Speaker 01:
That is incorrect.

[00:04:09] Speaker 01:
What the claims actually say is that by means of the hardness difference, you form at a temperature below the melting point of the wire.

[00:04:19] Speaker 01:
So it is not simply that hardness impacts the temperature of formation in some way.

[00:04:26] Speaker 01:
The causation recited in this claim is in fact that the hardness is the cause of getting to this claimed result of being below a certain temperature.

[00:04:35] Speaker 01:
Now could you then further reduce the temperature through other means such as size?

[00:04:41] Speaker 01:
Certainly you could.

[00:04:42] Speaker 01:
But you would have to show for this particular claim the way it's drafted.

[00:04:46] Speaker 02:
Just to clarify, does the intrinsic record actually say the hardness difference must be the primary or but for cause?

[00:04:53] Speaker 01:
The intrinsic record, for example, says that hardness is the... It says various things that are different in different places.

[00:05:05] Speaker 01:
So it does say that in this patent, it is hardness that causes the results.

[00:05:10] Speaker 01:
So if we look, for example, at

[00:05:13] Speaker 01:
page 77 of the appendix, which is the 312 patent.

[00:05:17] Speaker 04:
Just give me column and line number, please.

[00:05:19] Speaker 01:
Column 1, lines 54 through 58.

[00:05:23] Speaker 01:
It says that an objective of the present invention is to lower the temperature by using the hardness difference.

[00:05:32] Speaker 01:
So not by using the size difference.

[00:05:35] Speaker 01:
That is the objective here.

[00:05:36] Speaker 01:
Now, could you use size?

[00:05:38] Speaker 04:
One of the objectives

[00:05:39] Speaker 01:
It is one of the objectives.

[00:05:41] Speaker 01:
It is one of the objectives.

[00:05:44] Speaker 02:
So that doesn't say but for cause though, right?

[00:05:47] Speaker 02:
Is there a part you're daring to point us to that relates to but for cause?

[00:05:51] Speaker 01:
The patent doesn't use the word but for cause.

[00:05:54] Speaker 01:
The problem with any other construction is you get into a realm, like we talked about in the brief, where even the smallest impact

[00:06:04] Speaker 01:
uh... could be covered by the claim but that's not what's going to like thirteen twenty-one specifically discuss optimizing both the hardness difference and size difference to lower the manufacturing temperature precisely they do and what we have to do and and the distinction here is that they chose to claim only hardness and not size and so that has to have some meaning well but now this is a comprising correct

[00:06:30] Speaker 04:
Yes, so it's definitely true that hardness has to impact temperature, right?

[00:06:37] Speaker 04:
That much we know for sure, but it doesn't mean that hardness can be the exclusive impact on temperature.

[00:06:43] Speaker 01:
And we would agree, but the claim doesn't say hardness, it does not say by means of hardness you reduce the temperature.

[00:06:51] Speaker 01:
That is not the claim.

[00:06:52] Speaker 01:
It does not say by means of hardness we have a reduction.

[00:06:55] Speaker 01:
It says by means of hardness,

[00:06:57] Speaker 01:
we form at a temperature below the melting point of the insulation, below 300 degrees Celsius.

[00:07:03] Speaker 01:
That is what the claim requires.

[00:07:04] Speaker 01:
So if hardness just gets you some small reduction, but is not what gets you below that melting point, then that limitation is not met.

[00:07:13] Speaker 04:
OK, do you want to move on to your validity argument?

[00:07:16] Speaker 01:
I do.

[00:07:16] Speaker 01:
I would like to move on to non-imprisonment, because even if you were to affirm the district.

[00:07:21] Speaker 04:
I'd like you to move on to validity, please.

[00:07:22] Speaker 01:
Validity, yes.

[00:07:23] Speaker 01:
OK.

[00:07:27] Speaker 01:
So for invalidity, our expert presented two different references, Schaeffer and Nakamura.

[00:07:35] Speaker 01:
Schaeffer disclosed a molded choke that had a wound wire and it had two magnetic powders that met

[00:07:45] Speaker 01:
All of our experts had met all the limitations of the claims.

[00:07:49] Speaker 01:
He did acknowledge that the size and hardness of the two powders in Schaeffer were not expressly present.

[00:07:55] Speaker 01:
And for those properties of magnetic powders, he relied on a separate reference, Nakamura.

[00:08:01] Speaker 01:
Nakamura discloses an electronic device with two mixed powders.

[00:08:07] Speaker 01:
They do differ in size.

[00:08:08] Speaker 01:
They do differ in hardness.

[00:08:10] Speaker 01:
And they fall under.

[00:08:11] Speaker 03:
How do you respond to the argument

[00:08:13] Speaker 03:
Nakamura has ranges, and so because it has ranges of size and hardness,

[00:08:21] Speaker 03:
It doesn't expressly disclose the importance of having a first powder that's got larger, harder, and then the second powder is smaller and softer.

[00:08:33] Speaker 01:
And that is why it's an obvious misreference.

[00:08:35] Speaker 01:
And our expert said to him that teaches that they are, the ranges are not the same.

[00:08:41] Speaker 01:
One is higher than the other.

[00:08:42] Speaker 01:
And so you do have one powder generally falling into a larger range than the other powder.

[00:08:49] Speaker 01:
And the patent here, when it uses average size, there was no particular magic in that phrase.

[00:08:57] Speaker 01:
It was simply conveying what the patent says, which is that you do have a size difference.

[00:09:01] Speaker 01:
But as both experts said below, these sizes, when we're talking about the size of a powder, it's not a single size.

[00:09:08] Speaker 01:
There's always a range.

[00:09:10] Speaker 03:
Are you suggesting that the reference teaches at least some instances in which that property or function is met in the claim?

[00:09:16] Speaker 01:
It teaches that as well as just simply the concept that the powders have differing ranges and therefore some have a larger size distribution than others.

[00:09:28] Speaker 01:
And so when we're talking about a difference in average size, it's simply teaching that it would have been obvious to have powders that were generally larger and powders that were generally smaller with an associated hardness difference.

[00:09:43] Speaker 01:
And so the district court

[00:09:46] Speaker 01:
uh, really never addressed this particular combination in his Jamal order.

[00:09:52] Speaker 01:
Um, what it said was simply that it couldn't find a size or a hardness difference in the shape of reference.

[00:09:58] Speaker 01:
But again, for obviousness, that was not the reference we were relying on for those size and hardness differences.

[00:10:04] Speaker 02:
So fundamentally, do you just want the jury to be able to pass on this particular question as opposed to what happened here with the district court?

[00:10:11] Speaker 02:
Is that the relief that you would be seeking?

[00:10:15] Speaker 01:
I'm sorry, say that again.

[00:10:16] Speaker 02:
Do you want a jury to pass on this obvious issue?

[00:10:18] Speaker 01:
Yes, absolutely.

[00:10:20] Speaker 01:
OK.

[00:10:20] Speaker 01:
Thank you, Your Honor.

[00:10:22] Speaker 01:
I understand, of course, the guidance.

[00:10:26] Speaker 01:
I did just want to say I wanted to point to one piece of evidence in the record, and that was at 9847 of the appendix, the cross-examination of Dr. Cole.

[00:10:39] Speaker 01:
And he was asked, how would you determine the impact hardness would have

[00:10:44] Speaker 01:
on formation temperature under any construction.

[00:10:47] Speaker 01:
And he said he would have to do that through experimentation.

[00:10:51] Speaker 03:
I'm happy to do so.

[00:10:56] Speaker 03:
What assumptions do you think that Mr. Van Ouden made that you think were speculative?

[00:11:05] Speaker 01:
So there's two sort of separate buckets these fall into.

[00:11:10] Speaker 01:
There's the importation percentages, which impact both lost profits and the royalty, because both were applied to how many devices were imported.

[00:11:18] Speaker 03:
Why don't you focus on that one first?

[00:11:19] Speaker 01:
Absolutely.

[00:11:21] Speaker 01:
So for example, if we just pick one example, which is Qualcomm.

[00:11:26] Speaker 01:
This is one of the companies that Mr. Van Newton spoke about.

[00:11:30] Speaker 01:
And the evidence he used to show their importation percentages is at page 4187 of the appendix.

[00:11:37] Speaker 01:
This is an excerpt from Qualcomm's 10K filing.

[00:11:41] Speaker 01:
And he says this tells you how many devices were coming into the United States.

[00:11:47] Speaker 01:
But what the page actually says is that these revenue numbers do not reflect the country where the device is sold or used.

[00:11:56] Speaker 01:
Moreover, the page says that

[00:11:59] Speaker 01:
the revenue includes licensing revenue, for example, between Qualcomm and Apple, and that that licensing revenue is booked based on the location of the licensee.

[00:12:07] Speaker 01:
So the fact that Apple is in Cupertino will impact their sales and how much of it goes to the US.

[00:12:14] Speaker 01:
And in fact, if you look at page- Which one are you looking at?

[00:12:17] Speaker 03:
I'm looking at 4187.

[00:12:18] Speaker 03:
4187?

[00:12:18] Speaker 01:
Well, yeah.

[00:12:19] Speaker 03:
What are you specifically looking at there?

[00:12:21] Speaker 03:
Under revenues, nonreportable segments, what are you looking at?

[00:12:24] Speaker 01:
It's above the revenue numbers, Your Honor.

[00:12:25] Speaker 03:
We've got to be careful here.

[00:12:28] Speaker 01:
Yes, so above the paragraph, the revenue numbers show breakdowns by US and the rest of the world for their entire revenue.

[00:12:37] Speaker 01:
And above that, in highlighting, and I see that I'm getting into my rebuttal time, but very briefly, it says that we report revenues.

[00:12:50] Speaker 01:
It says, as a result, the revenues by country presented herein are not necessarily indicative of either the country in which devices

[00:12:57] Speaker 01:
containing our products and or intellectual property are ultimately sold to consumers or the country in which the companies that sell devices are headquartered.

[00:13:06] Speaker 01:
So the question is not whether the 10K is accurate.

[00:13:10] Speaker 01:
It's accurate in so far as what it reports.

[00:13:12] Speaker 01:
The question is the methodology.

[00:13:13] Speaker 01:
Should this particular number have been applied?

[00:13:16] Speaker 01:
And with that, Your Honor, I'd like to reserve the remainder of my time.

[00:13:19] Speaker 04:
That's fine.

[00:13:20] Speaker 01:
Thank you.

[00:13:21] Speaker 04:
Mr. Johnson, please proceed.

[00:13:23] Speaker 00:
Thank you, Your Honor, and may it please the Court.

[00:13:26] Speaker 00:
I'd like to begin with the by means of limitation because I think the Court's questions highlight the problem with Mr. Lamberson's interpretation.

[00:13:34] Speaker 00:
There are three textual signals in this limitation that tell you, without even looking to the specification, that the hardness difference simply needs to make a contribution to the lower formation temperature.

[00:13:46] Speaker 00:
They include the following.

[00:13:47] Speaker 04:
The fact that there's no- Okay, why don't you move on to validity?

[00:13:51] Speaker 00:
Okay, Your Honor.

[00:13:52] Speaker 00:
Happy to.

[00:13:56] Speaker 00:
The two references that issue here, Schaeffer and Nakamura, would not guide an ordinarily skilled artisan to learn anything.

[00:14:07] Speaker 00:
They don't suggest anything about the relationship between size and hardness.

[00:14:13] Speaker 00:
Let me start with the point about ranges.

[00:14:17] Speaker 00:
There is some overlap in the ranges of Nakamura, but within those ranges, the two particles at issue could have the opposite relationship of size and hardness that is claimed by syntax.

[00:14:33] Speaker 03:
That's true, but what about the fact that your claim, it doesn't itself have a range.

[00:14:39] Speaker 03:
It's not like you're trying to look at a range and prior and apply it to a new range that you've claimed instead.

[00:14:45] Speaker 03:
you have a particular relationship that you've claimed that in many circumstances, the majority of the circumstances, Nakamura will disclose.

[00:14:58] Speaker 00:
In some circumstances, the range is there.

[00:15:01] Speaker 03:
There's at least some instances in Nakamura where they will satisfy having larger, harder particles

[00:15:10] Speaker 03:
and then, I guess, smaller, softer particles, right?

[00:15:14] Speaker 00:
But there's quite a number of inferences that you have to make to get to the point where you get the right combination.

[00:15:23] Speaker 00:
And this court's teaching in cases like Genentech and Sinvena tell you that there's no presumption of a prima facie case of obviousness where there's something unique

[00:15:35] Speaker 00:
within the range.

[00:15:36] Speaker 00:
Here, the special and critical subset of the range is the situation where the larger particles are the harder particles and the smaller ones are softer.

[00:15:45] Speaker 00:
The range includes the opposite and nothing in the patent either guides you to particular points in the range or even suggests the problem.

[00:15:53] Speaker 04:
I think that the problem I have with your argument is that the court did this on Jamal and the jury didn't get to decide it.

[00:16:00] Speaker 04:
I mean, you may be exactly right and the jury may accept everything you're saying.

[00:16:05] Speaker 04:
But these sound like when you say there are a number of inferences you'd have to accept, that's exactly at J-Mall what you have to do is you have to accept all the inferences in favor of the other side.

[00:16:14] Speaker 04:
And so if we accept all those inferences, I just don't see how J-Mall was proper here.

[00:16:20] Speaker 00:
Well, and the reason, I think, is that you have to look at the cross-examination of Dr. Brodman.

[00:16:24] Speaker 00:
And it was after that cross-examination of Dr. Brodman that Jamal was granted.

[00:16:28] Speaker 04:
But again, that goes to a fact-finding end.

[00:16:30] Speaker 04:
And by the way, the tribunal below didn't explain any of that.

[00:16:33] Speaker 00:
But Your Honor.

[00:16:34] Speaker 04:
So you're trying to tell me that this was the rationale upon which the trial court decided to grant Jamal, but the trial court didn't say any of that.

[00:16:41] Speaker 04:
The trial court didn't go through Dr. Brodman's testimony at all, really.

[00:16:47] Speaker 00:
So the question on appeal under Rule 50 is whether any reasonable jury could conclude that these patents are obvious.

[00:16:56] Speaker 00:
And if you look at what Dr. Brabman admitted,

[00:17:00] Speaker 00:
And again, Jaymaw was granted immediately after that.

[00:17:03] Speaker 00:
These are a number of the things he admits.

[00:17:06] Speaker 00:
He admits that Nakamura uses the same forming and curing steps as in the prior art.

[00:17:11] Speaker 00:
He admits that the only discussion of heat treatment in Nakamura was not to relieve strain caused by molding pressure, that it's simply about weighing the materials.

[00:17:19] Speaker 00:
He admits that there's no discussion in Nakamura of the strain-related problems that syntax solves.

[00:17:26] Speaker 00:
There's no reason to combine.

[00:17:27] Speaker 03:
Nakamura is just one reference of the two combined references, correct?

[00:17:32] Speaker 00:
Well, right, Your Honor, but Schaeffer doesn't even discuss size or hardness.

[00:17:37] Speaker 03:
But it does give two examples that the jury could have then heard expert testimony about.

[00:17:43] Speaker 00:
But in the two examples, it was admitted uncross again by Dr. Brabman that the anchor core steel could be softer than the carbonyl iron.

[00:17:52] Speaker 00:
And there's nothing, nothing about size in Schaeffer.

[00:17:57] Speaker 00:
So the central insight of the patent that the larger particle needs to be the harder particle, Schaeffer doesn't even get you to first base.

[00:18:04] Speaker 03:
Wasn't there some testimony also about the knowledge of one of ordinary skilled art generally outside of these two patents that the jury would have heard?

[00:18:14] Speaker 00:
Your Honor, the other references didn't relate to molding chokes, and none of them discussed high temperature annealing.

[00:18:21] Speaker 00:
Offhand, I don't recall any more specifics than that, but none of these patents

[00:18:29] Speaker 00:
are dealing with the problem that Syntek was solving.

[00:18:33] Speaker 00:
And so you have a situation where nothing in the references guides you to the right relationship.

[00:18:41] Speaker 00:
And if they don't tell you the problem that you need to solve, how could you have a reasonable expectation of success in solving it when you read these references?

[00:18:49] Speaker 03:
Didn't syntax expert Dr. Cole explain how the differences in hardness values impact the formation of temperature of chokes?

[00:18:56] Speaker 03:
I mean, wasn't there some testimony?

[00:18:58] Speaker 03:
That's the kind of testimony I'm talking about.

[00:19:00] Speaker 00:
He absolutely talked about how the difference in hardness temperatures affect formation temperature.

[00:19:05] Speaker 00:
And of course, that's the infringement issue.

[00:19:07] Speaker 00:
And on that point, by the way, I would note that in response to Mr. Lamberson's point about experiments,

[00:19:13] Speaker 00:
Dr. Cole specifically walked through how their products use the preferred embodiment and track the experiments in the patents.

[00:19:23] Speaker 00:
So although he did not test Chilison's products, he very carefully walked through how the experiments in the patents tell you what you need to know about testing.

[00:19:36] Speaker 02:
Did your expert ever tie his damages analysis?

[00:19:38] Speaker 02:
I'm switching gears.

[00:19:39] Speaker 00:
Switching your damages, OK.

[00:19:40] Speaker 02:
Yeah, to infringing products at some point.

[00:19:43] Speaker 00:
Absolutely.

[00:19:44] Speaker 00:
And I want to walk through the methodology on this here, because it has been, I think, unfairly portrayed.

[00:19:49] Speaker 00:
This was Mr. Van Uden's methodology.

[00:19:51] Speaker 00:
He started with Chilison's own customer's sales data.

[00:19:56] Speaker 00:
He identified the products that were so infringing products that were sold abroad for end use in U.S.

[00:20:03] Speaker 00:
consumer electronic.

[00:20:04] Speaker 00:
So he's starting with infringing sales.

[00:20:08] Speaker 03:
He has to make his assumptions though in order to determine because those were sales outside the United States.

[00:20:14] Speaker 03:
So where the assumptions come in is where he has to calculate the amount of imports, the amount of products that went back.

[00:20:22] Speaker 03:
into the United States, right?

[00:20:24] Speaker 00:
That's correct, Your Honor.

[00:20:25] Speaker 03:
Yes, he made reasonable... The question is whether they're reasonable.

[00:20:27] Speaker 00:
Yes, and he made conservative assumption after conservative assumption to make sure that he was not overstating the damages.

[00:20:34] Speaker 03:
So... What about, can I ask you this, was it fair where there's a multi-party market for him to assume that, for example, a company like Apple bought their chokes from one, only from Chilison?

[00:20:50] Speaker 00:
So first of all, the testimony in this case was that it was conservative to look at this as a multi-party market, because in most situations, it was a two-supplier scenario.

[00:21:01] Speaker 00:
So he took a market share approach as a conservative way of saying, OK, that's not always the case, but often it is.

[00:21:08] Speaker 03:
But did he take a market share approach in determining the percentage of imports?

[00:21:12] Speaker 03:
That's what I'm asking.

[00:21:14] Speaker 03:
You're talking about a market share approach later when he's calculating lost profits.

[00:21:18] Speaker 00:
So I didn't get far enough into the methodology.

[00:21:20] Speaker 00:
If I may, I think it'd be helpful for me to walk through exactly what he did.

[00:21:23] Speaker 00:
So he starts with Chilison's own customers' actual sale numbers.

[00:21:27] Speaker 00:
He analyzed the sales to these companies.

[00:21:29] Speaker 00:
He broke them down into situations where there are other design code requirements, i.e.

[00:21:33] Speaker 00:
where Chilison itself tracks the type of product specifications and who it's ultimately going to.

[00:21:40] Speaker 00:
Then, and this is where it starts to get into determining the import percentages,

[00:21:43] Speaker 00:
He looked at 10Ks, which of course are sworn statements to the government.

[00:21:48] Speaker 00:
He looked at audited financials.

[00:21:50] Speaker 00:
And he looked at third-party data to break down the sales by geographic region.

[00:21:55] Speaker 00:
Now, he used the Gardner data, which is private, reliable data that Shilson's own expert admitted he relied on himself, and the company itself relies on, to corroborate the 10K percentages.

[00:22:10] Speaker 04:
Just out of curiosity, was the data for each customer?

[00:22:12] Speaker 00:
Yes, that the Gardner data is the third party data where it existed is for each customer and it covered Yes I'm trying to explain your honor.

[00:22:25] Speaker 00:
There were six customers for which it existed It was more than half of the products that you Apple alone was 40% Now here's why there's looking lost profits from 27 customers, right?

[00:22:36] Speaker 04:
So you had data from six about the other 21

[00:22:38] Speaker 00:
We did not have Gartner data from the other 21, but if you compare the 10K numbers with the Gartner numbers, you see that they are within three to five percentage points, in all cases except one, and in the one case where it was greater, he used the lower percentage.

[00:22:54] Speaker 02:
Did you ever try to do any discovery to get some additional data beyond the Gartner data?

[00:22:58] Speaker 00:
So Your Honor, if you're saying we should have subpoenaed additional information, Chilison provided its actual sales number after Discovery closed.

[00:23:09] Speaker 00:
And of course, the foreign companies were beyond the subpoena power of the court.

[00:23:14] Speaker 00:
This court's cases teach that when you- I just want to answer my question, okay?

[00:23:18] Speaker 02:
Did you ever do Discovery to get some additional data beyond the Gartner data?

[00:23:23] Speaker 00:
Yes, no, maybe- Yes, we got actual sales numbers from Chilison, Your Honor.

[00:23:26] Speaker 00:
I'm sorry, I misunderstood.

[00:23:27] Speaker 00:
Yes, no.

[00:23:28] Speaker 02:
So I'm sorry, I must have misunderstood your question, your honor.

[00:23:36] Speaker 02:
OK, I'll give it another go.

[00:23:38] Speaker 02:
OK, so we've talked about the fact that there are all these different customers.

[00:23:41] Speaker 02:
Did you ever go get some additional discovery from other customers beyond I believe was six that we've talked about that were in the Gartner data?

[00:23:49] Speaker 00:
Right.

[00:23:49] Speaker 00:
So that's what I was saying.

[00:23:50] Speaker 00:
We did not subpoena them, Your Honor, because Chilison provided its actual sales data to us, which elucidated who their customers were after the close of discovery.

[00:24:00] Speaker 00:
And of course, the overseas companies would be beyond the subpoena power of the court.

[00:24:04] Speaker 00:
The third party data comes from a market research, a very reputable market research firm called Gartner.

[00:24:09] Speaker 00:
It admittedly did not exist for all 27 companies.

[00:24:13] Speaker 00:
But it was for a majority of the sales.

[00:24:15] Speaker 00:
And wherever Mr. Van Uden did not have reliable third-party data, he simply excluded the company.

[00:24:22] Speaker 03:
Can I ask you another question?

[00:24:23] Speaker 03:
Absolutely, Your Honor.

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

[00:24:24] Speaker 03:
So we have read the expert report and the testimony provided to us.

[00:24:30] Speaker 03:
So one question I have that wasn't clear to me is I saw, for example, on Apple's 10K,

[00:24:35] Speaker 03:
the amount of revenue that they had in the United States would include things that would not have a choke on it.

[00:24:41] Speaker 03:
And so how did he deal with that?

[00:24:43] Speaker 00:
But your honor, that's why you have to remember where this data begins.

[00:24:48] Speaker 00:
Mr. Van Uden began with actual numbers of infringing choke sales.

[00:24:53] Speaker 03:
And then he said, let's narrow down to what came in the United States.

[00:24:56] Speaker 03:
I understand, but he multiplied that by an import percentage that includes, you know, percentage is off if it doesn't include choke products.

[00:25:06] Speaker 00:
And the Gartner data are specific to product categories.

[00:25:10] Speaker 00:
They're specific to choke categories of products that contain chokes.

[00:25:15] Speaker 00:
It's not an exact science.

[00:25:16] Speaker 03:
What evidence was there that he relied on to determine whether, for those particular customers, other chokes were provided by other customers?

[00:25:26] Speaker 03:
Was there an assumption that a company like Apple gets all its chokes from one company?

[00:25:32] Speaker 00:
your honor nothing in this court's precedents teach that you have to have.

[00:25:37] Speaker 03:
I mean.

[00:25:45] Speaker 03:
Just the facts right now.

[00:25:49] Speaker 00:
So the Apple data were specific to categories of products.

[00:25:55] Speaker 00:
They were the Gartner data.

[00:25:57] Speaker 00:
They're not they're not down to the

[00:25:59] Speaker 00:
to the jot and tittle of every particular type of product.

[00:26:03] Speaker 00:
But they are specific to product categories.

[00:26:04] Speaker 00:
And the district court acknowledges this in her opinion.

[00:26:08] Speaker 03:
I don't think that answers my question.

[00:26:09] Speaker 03:
My question for you is how do you make your management in?

[00:26:13] Speaker 03:
How do you account for the fact that there might be dual suppliers of chokes for any of these 27 customers?

[00:26:25] Speaker 00:
Well, Your Honor, if there are

[00:26:29] Speaker 00:
dual suppliers, and it's a two supplier market as often, is of course the fact that they're copying the products and with infringing and making infringing sales means you would get it.

[00:26:40] Speaker 03:
I guess my point is this.

[00:26:42] Speaker 03:
You're saying that in order to determine how many products were imported into the United States, they looked at all of the revenue

[00:26:53] Speaker 03:
from the products that could have chokes for each of those 27 companies.

[00:26:58] Speaker 03:
And my question is, then, how do you know that those chokes were all provided by the accused infringer in this case?

[00:27:05] Speaker 00:
Well, again, this was not a case of backing into the damages number by starting from revenue.

[00:27:11] Speaker 00:
It was a case of starting from infringing sales and applying a percentage to it.

[00:27:16] Speaker 00:
OK.

[00:27:17] Speaker 00:
If there are no further questions, we urge the court to affirm.

[00:27:20] Speaker 04:
OK, thank you.

[00:27:21] Speaker 04:
Mr. Lamberson, you have some bottle time.

[00:27:23] Speaker 01:
On the Gartner data, Your Honors, first of all, we have no idea which phones or computers or tablets in this record contain accused jokes.

[00:27:38] Speaker 01:
It's simply not there.

[00:27:39] Speaker 01:
And when we look at it, we do have some statements in the record about, well, we were both trying to sell Apple to their phones, phones generally, not specific models, or to Microsoft Xbox, for example.

[00:27:51] Speaker 01:
But there's no discovery, no information about which ones actually contain the chokes, which were imported, and what volumes.

[00:28:01] Speaker 01:
And even the Gartner data, which is in the appendix at 15759.

[00:28:05] Speaker 01:
When we look at Microsoft, it talks about phone and UMT.

[00:28:11] Speaker 01:
We don't know in the record what UMT includes.

[00:28:14] Speaker 01:
None of these seem to relate to Xbox gaming consoles, for example.

[00:28:18] Speaker 02:
Your opposing counsel seemed to imply that some information that they got from you would enlighten us more about what was going on with the 27 customers.

[00:28:26] Speaker 02:
Can you just briefly address that?

[00:28:29] Speaker 01:
Certainly.

[00:28:30] Speaker 01:
It's not the case.

[00:28:32] Speaker 01:
I mean, there's nothing in the record that suggests Chilison knows

[00:28:36] Speaker 01:
where the end products go or what chokes go into them.

[00:28:42] Speaker 01:
Chilison very frequently sells chokes to what are called OEMs or ODMs, companies like Foxconn, and they will then stick it into some other sub-assembly which gets put into something else which eventually perhaps gets put into a phone.

[00:28:56] Speaker 01:
uh... but shows in itself is simply supplying chokes foxconn it doesn't know which specific phones those going to and you know foxconn could take uh... uh... you know uh... one choke that was going into one phone and put it in another phone or another device and and chosen simply wouldn't know that if if there was evidence that chosen have more information that could have been addressed at the district court by filing motions by asking for more discovery certainly could have been addressed third-party discovery i don't agree at all that

[00:29:26] Speaker 01:
you know, third parties are out.

[00:29:28] Speaker 01:
I mean, Apple.

[00:29:29] Speaker 01:
Apple is in the United States.

[00:29:30] Speaker 01:
Could they not have subpoenaed Apple?

[00:29:32] Speaker 01:
They could have certainly.

[00:29:33] Speaker 01:
Thank you, Your Honor.

[00:29:35] Speaker 04:
Thank you both counsel.

[00:29:36] Speaker 04:
This case is taken under submission.