[00:00:00] Speaker 02:
Our final case for argument today is 22-2098, Ingerin versus ABS Global.

[00:00:08] Speaker 02:
Mr. Horowitz, please proceed.

[00:00:31] Speaker 00:
Thank you, Your Honor.

[00:00:32] Speaker 00:
May it please the court.

[00:00:35] Speaker 00:
The central question in this appeal is whether the Newnheist reference discloses focusing at the vertical position inlet.

[00:00:42] Speaker 00:
What Newnheist actually says about the vertical position inlet is that there is some vertical compression.

[00:00:49] Speaker 00:
ST's expert testified.

[00:00:50] Speaker 02:
What's the word focusing mean according to the district court, which is not appealed to us?

[00:00:56] Speaker 00:
Focusing, as the court instructed the jury, is narrowing.

[00:01:01] Speaker 00:
pinching or confining the particular stream or sample stream with sheath fluid causing acceleration of the sheath load.

[00:01:08] Speaker 00:
That's at 51204.

[00:01:10] Speaker 02:
So it's not just narrowing, pinching, or confining.

[00:01:13] Speaker 02:
It requires the causing of acceleration, correct?

[00:01:15] Speaker 00:
That's right.

[00:01:16] Speaker 02:
The claim construction requires causing acceleration.

[00:01:19] Speaker 02:
Continue.

[00:01:19] Speaker 00:
Yes.

[00:01:20] Speaker 00:
And let me finish up on compression, then I want to turn to acceleration.

[00:01:24] Speaker 00:
So as to compression, excuse me, as to narrowing,

[00:01:29] Speaker 00:
There's no dispute, their expert testified, that compression means narrowing.

[00:01:34] Speaker 00:
And narrowing, plus acceleration, which I'll get to, is focusing under the district court's claim construction.

[00:01:41] Speaker 00:
That's all you need for purposes of anticipation.

[00:01:45] Speaker 00:
You can talk about Figure 3.

[00:01:47] Speaker 00:
I'll pass on that for a moment.

[00:01:48] Speaker 00:
And I'll say that their expert tried to

[00:01:53] Speaker 00:
minimize the compression by saying it's slight, or that's not really what Neuenheiss is about.

[00:01:59] Speaker 00:
But neither of those things makes any difference.

[00:02:02] Speaker 00:
In terms of what it's about, what it's really for, that's a purpose-based argument that SD has wisely abandoned on appeal.

[00:02:09] Speaker 00:
And in terms of whether it's slight,

[00:02:10] Speaker 00:
talking about the claim construction, which I just referred the court to, there is no requirement in the construction of any particular degree or magnitude of narrowing, just as in the Robert Bosch case.

[00:02:19] Speaker 03:
Can you turn to the acceleration point?

[00:02:21] Speaker 00:
Absolutely.

[00:02:22] Speaker 00:
So ST did not defend the verdict below on the basis of acceleration and for good reason.

[00:02:28] Speaker 00:
There's no serious question when you add fluid to a channel or a pipe or a tube

[00:02:33] Speaker 00:
through which fluid is already flowing, everything's going to go faster.

[00:02:36] Speaker 00:
This is familiar to anyone who's turned up the pressure on a garden hose or a shower.

[00:02:42] Speaker 00:
More water in a pipe of consistent dimensions means more pressure, more speed.

[00:02:46] Speaker 02:
Here's the problem.

[00:02:48] Speaker 02:
You're saying that doesn't make it true or make it evidence that was before the jury.

[00:02:53] Speaker 00:
Absolutely.

[00:02:53] Speaker 00:
And there's plenty of evidence before the jury on acceleration, both with our expert and theirs.

[00:02:58] Speaker 00:
So their expert at 51... Wait, stop for a sec.

[00:03:01] Speaker 02:
Do you agree that

[00:03:03] Speaker 02:
It's called new and heist.

[00:03:04] Speaker 02:
Am I saying that right?

[00:03:05] Speaker 00:
That's how I've learned to say it.

[00:03:06] Speaker 02:
OK, new and heist.

[00:03:07] Speaker 02:
Do you agree that new and heist itself doesn't speak of acceleration?

[00:03:10] Speaker 00:
The word acceleration is not a new and heist.

[00:03:12] Speaker 02:
And so what we have to do is we have to be convinced that this disclosure of possibly more liquid and vertical compression as a matter of inherency automatically results in acceleration, correct?

[00:03:28] Speaker 02:
Every time, all the time.

[00:03:29] Speaker 02:
Acceleration is not disclosed.

[00:03:32] Speaker 02:
So we have to read this and conclude that what is disclosed for sure causes acceleration.

[00:03:38] Speaker 00:
Sure, yeah, absolutely.

[00:03:39] Speaker 02:
That's inherency.

[00:03:41] Speaker 00:
I don't think anyone's characterized it as inherency, but I think we would say, I don't think it makes a difference.

[00:03:46] Speaker 00:
You can call it inherency.

[00:03:47] Speaker 00:
I think the addition of fluid to a straight channel, a person of skill would recognize that to cause focusing, which includes acceleration.

[00:03:55] Speaker 00:
The construction in this regard

[00:03:57] Speaker 00:
Acceleration if you even read it, it says, you know narrowing pinching or confining causing there's a necessary causal relationship between the two things But let me just get to the evidence on it because as I say, it's the same on both sides So their expert was asked first of all, let's take a step back talking about how these devices work in general Our expert explained if you add fluid I don't want generality.

[00:04:20] Speaker 02:
I want to see the evidence that

[00:04:23] Speaker 02:
that amounts to, because we have a jury verdict, and we have to defer to that if there's substantial evidence to support it.

[00:04:29] Speaker 02:
And so what your expert said in general doesn't contradict the possibility of substantial evidence to support the jury verdict.

[00:04:37] Speaker 02:
And so the question is, how can you prove that no reasonable person could read this passage and conclude that this would not cause acceleration?

[00:04:46] Speaker 00:
So I'll start with the new and highest reference in terms of the expert testimony, and I'll start with their expert.

[00:04:53] Speaker 00:
What their expert admitted.

[00:04:54] Speaker 02:
Which one and on what page?

[00:04:56] Speaker 00:
Dr. Vaca, 51, 156 of the Joint Appendix.

[00:05:00] Speaker 00:
That's volume two.

[00:05:11] Speaker 00:
At the bottom, starting at line 17.

[00:05:13] Speaker 02:
You'd agree with me, because the channel doesn't... Just to be clear for one second, am I understanding right that this was in the portion of this testimony directed to infringement?

[00:05:21] Speaker 02:
This had nothing to do with the Neuheist Act.

[00:05:24] Speaker 00:
This has everything to do with Neuheist.

[00:05:25] Speaker 00:
This is the cross-examination on Neuheist.

[00:05:28] Speaker 02:
Oh, okay.

[00:05:28] Speaker 02:
Where does it say that?

[00:05:30] Speaker 02:
Where can I get a sense that this is about Neuheist?

[00:05:33] Speaker 02:
Well, Neuheist... I thought I understood them to say that this was in the infringement.

[00:05:37] Speaker 00:
No, no.

[00:05:39] Speaker 01:
So 51... Sorry, can you give me the... Oh, you're about to give me the page number.

[00:05:42] Speaker 00:
The page I'm specifically looking at is 51158.

[00:05:44] Speaker 00:
The prior page refers to Neuenheiss and Flowcell 2.

[00:05:52] Speaker 00:
At the top of 51157, you can see we're talking about Neuenheiss.

[00:05:56] Speaker 00:
This is cross-examination of their expert on Neuenheiss.

[00:06:02] Speaker 00:
And in fact, they could have looked at 51158.

[00:06:04] Speaker 00:
Sorry, I'm on the wrong page now.

[00:06:08] Speaker 00:
51156.

[00:06:09] Speaker 00:
All of this is Neuenheiss.

[00:06:11] Speaker 00:
The question I want to direct the court's attention to is on 156.

[00:06:18] Speaker 00:
Question, you would agree with me because the channel doesn't change in dimension here when sheath fluid is added at the vertical position inlet.

[00:06:27] Speaker 00:
That's what we're focused on.

[00:06:29] Speaker 00:
The laws of conservation of mass and momentum dictate that both the sheath fluid and the sample fluid accelerate at that point, correct?

[00:06:37] Speaker 00:
Yeah.

[00:06:38] Speaker 00:
Actually, I'm glad you brought that up.

[00:06:40] Speaker 00:
He wanted to expand.

[00:06:41] Speaker 00:
He wanted to say more than that.

[00:06:42] Speaker 00:
But he was asked the question.

[00:06:43] Speaker 00:
He gave the answer yes.

[00:06:45] Speaker 00:
And this is something that Judge Connolly did consistently and, I think, properly throughout cross-examination.

[00:06:50] Speaker 00:
If someone wanted to say more than just answer the question, he would stop.

[00:06:54] Speaker 03:
Was there a redirect on that point?

[00:06:56] Speaker 03:
Like, did they indicate something else?

[00:06:58] Speaker 00:
Yes.

[00:06:58] Speaker 03:
It sounds like he was cut off.

[00:06:59] Speaker 03:
Can we go to that as well, just for completeness?

[00:07:02] Speaker 00:
So that's around 178.

[00:07:03] Speaker 00:
Excuse me, 176.

[00:07:09] Speaker 00:
What he's saying at 176 to 177, he's describing, this background is helpful to understand it because this is technical.

[00:07:20] Speaker 00:
Downstream of the vertical position inlet in new and heist there are these this pair of horizontal Inlets that can force fluid one way or the other by adding on one side and removing from the other That's a concept where if you you don't actually keep the same amount of fluid in if you remove from the other side You want us to look at on?

[00:07:38] Speaker 00:
Yes The whole 151 76 okay is this or

[00:07:48] Speaker 00:
concept that I'm trying to describe that you wanted the explanation that you wanted to get.

[00:07:52] Speaker 00:
I'm not sure if it's novel, but they're talking about modulating through different ports.

[00:07:57] Speaker 00:
This is the concept of modulation, where you add from one side and you subtract from the other side.

[00:08:02] Speaker 00:
That's with the horizontal control ports at the end of the channel, not the vertical position inlet.

[00:08:08] Speaker 00:
He's talking about the horizontal ones.

[00:08:10] Speaker 00:
And he's saying, this is a cool idea.

[00:08:11] Speaker 00:
Add here, subtract there.

[00:08:14] Speaker 00:
If you did that, and to be clear, nothing in Neuenhuis says you ever do that.

[00:08:20] Speaker 00:
There is no corresponding vertical position on the top.

[00:08:23] Speaker 02:
Well, why don't we, I mean, your argument is deviating a lot from what was argued to us.

[00:08:28] Speaker 02:
Why don't we stick with what was argued to us, which, as I understand it, is that Mr. Vacas redirect at 176 to 177

[00:08:37] Speaker 02:
explains especially on 177 line 3 that it's not necessarily the case that it's going to increase acceleration because there's also this modulation of flow rate that's going on at the same time.

[00:08:50] Speaker 02:
So that's what they argue, that it's not necessarily the case that you're going to have an increase in acceleration because you've got the modulation of flow rates.

[00:08:58] Speaker 02:
And then I understand Newhouse disclosed that modulation of flow rates in detail

[00:09:03] Speaker 02:
on page 39980, when it's talking about figure four, which is all about modulating flow rates.

[00:09:14] Speaker 02:
Now, I'm by far no expert in this field, but that is what they allege is the substantial evidence for why their expert did not in fact give away the farm, as you would like us to believe, but rather explained that Newhouse doesn't disclose necessarily increasing acceleration as a result of this particular embodiment.

[00:09:34] Speaker 00:
So again, as to the basic physics, it's very important because the removal is a separate issue.

[00:09:41] Speaker 00:
As to the basic physics, if it's the same, I'm sorry.

[00:09:43] Speaker 01:
What is modulation of flow rates as we're talking about?

[00:09:46] Speaker 00:
What they're talking about in new and highest with respect to the horizontal control ports in figure three, those are the ones downstream.

[00:09:55] Speaker 00:
You can see in the upper right-hand 39980, the upper right-hand view

[00:10:00] Speaker 00:
introducing fluid from the left and removing fluid from the right.

[00:10:04] Speaker 00:
And the idea is, if you want to keep the same dimensions, if that's what your goal was, you add from one side and subtract from the other.

[00:10:12] Speaker 00:
They describe that for the horizontal control ports.

[00:10:15] Speaker 00:
Never anywhere in Neuenheise is there any suggestion because there's no other port.

[00:10:20] Speaker 00:
There's no removal from the top.

[00:10:22] Speaker 00:
There's only inlet from the bottom.

[00:10:24] Speaker 00:
They never describe adding from the bottom and removing from the top, which is what happens at the horizontal control ports if you want.

[00:10:31] Speaker 00:
But Dr. Vaca said,

[00:10:32] Speaker 00:
Even with respect to the horizontal control ports, the device can focus.

[00:10:38] Speaker 01:
You're helping me with what Newenhouse shows, but I was asking a much stupider question, which is, what does it actually mean to modulate flow rates?

[00:10:46] Speaker 00:
Increase here, decrease there.

[00:10:48] Speaker 00:
Change.

[00:10:49] Speaker 00:
Increase pressure, turn up the tube over here, turn down the tube over there.

[00:10:53] Speaker 01:
And your view is, in the horizontal ones, they're doing it because that will move it, but not change the, I guess, diameter or something?

[00:11:03] Speaker 00:
It teaches you that you can.

[00:11:04] Speaker 00:
And this is important, because even with respect to the horizontal, VACA admits that there is focusing with the horizontal control ports.

[00:11:13] Speaker 00:
So the one as to which there is a modulation, and this is at 51.158, I believe, though we can check.

[00:11:20] Speaker 02:
I'm sorry, what?

[00:11:23] Speaker 00:
He admits that with the horizontal control ports, the one with respect to which there is... Where?

[00:11:28] Speaker 02:
What page?

[00:11:29] Speaker 00:
51158.

[00:11:29] Speaker 00:
51158.

[00:11:36] Speaker 02:
Okay.

[00:11:41] Speaker 00:
So 157 is where he talks about controlling the dimensions with the horizontal control ports.

[00:11:52] Speaker 00:
You don't dispute, this is 157, you don't dispute that the horizontal position inlets, they function and can function in the same way between the two, they could, and that the horizontal control ports focus from the left and right side walls, yes.

[00:12:08] Speaker 02:
He says they could, he doesn't say yes, they could.

[00:12:11] Speaker 00:
Sometimes they do and sometimes they don't, depending on how you operate it, but that's the point, it's a device claim.

[00:12:17] Speaker 00:
You can

[00:12:18] Speaker 00:
put fluid in, or you can take fluid out.

[00:12:22] Speaker 02:
See, here's my problem, though.

[00:12:24] Speaker 02:
My problem is you need to prove, because the reference doesn't disclose acceleration, the concept of inherency, which you admitted at the beginning, is a fine way to look at this, which means it always does.

[00:12:37] Speaker 02:
That this reference discloses to a skilled artisan

[00:12:41] Speaker 02:
that when this embodiment is practiced in the way disclosed, there will always be acceleration.

[00:12:45] Speaker 00:
It's not a method claim.

[00:12:46] Speaker 00:
This device always inherently in every instance has the capability, unless you specifically take fluid out, unless you specifically remove from the other side in the downstream horizontal control ports, it's going to narrow.

[00:12:59] Speaker 00:
The laws of conservation of mass dictate that, as she admitted, it's a device claim.

[00:13:04] Speaker 02:
With all due respect, it might be a device claim, but the agreed upon claim construction

[00:13:08] Speaker 02:
requires causing acceleration.

[00:13:11] Speaker 02:
This device does not in use always cause acceleration.

[00:13:15] Speaker 02:
This expert has explained how due to modulation there may not be any acceleration caused

[00:13:21] Speaker 02:
Therefore, it doesn't necessarily meet the focusing limitation.

[00:13:24] Speaker 00:
Your Honor, respectfully, the device absolutely doesn't cause any focusing unless you run fluid through it.

[00:13:28] Speaker 00:
The device doesn't focus a sample.

[00:13:30] Speaker 02:
Even when you run fluid through it, there could be modulation of flow rates that therefore results in no acceleration.

[00:13:36] Speaker 02:
You could intentionally break it.

[00:13:38] Speaker 02:
No, that's not intentionally breaking it.

[00:13:39] Speaker 02:
That's actually the description in the patent.

[00:13:42] Speaker 01:
So you have modulation in the vertical one?

[00:13:46] Speaker 00:
You can increase it.

[00:13:47] Speaker 00:
You can slow it down relatively speaking.

[00:13:50] Speaker 00:
I suppose you could put nothing through it.

[00:13:51] Speaker 00:
Again, if you put nothing.

[00:13:52] Speaker 02:
Doesn't figure four expressly say increase vertical position flow rate and decrease vertical position flow rate?

[00:13:56] Speaker 02:
So isn't that sort of judge's question yes?

[00:13:59] Speaker 00:
You can decrease it, but it doesn't suck it out as in the horizontals.

[00:14:03] Speaker 00:
That's the point.

[00:14:03] Speaker 02:
In the horizontals, there's... This is you saying it.

[00:14:06] Speaker 02:
There's no evidence anywhere of this.

[00:14:08] Speaker 02:
This is the problem.

[00:14:10] Speaker 02:
You failed to present evidence, and now you want to rely on their infringement discussion or their expert to fill in blanks about inherency.

[00:14:19] Speaker 00:
I referred to their expert only because it's substantial evidence, and I don't want you to say, my expert said it, and that's not good enough.

[00:14:24] Speaker 00:
I'm relying on theirs because that's all you need.

[00:14:27] Speaker 00:
It's right there on the same page, Your Honor, at 39981.

[00:14:30] Speaker 00:
When you're talking about horizontal, in that figure four, it says remove from left and add, remove from right and add.

[00:14:38] Speaker 00:
There's no disclosure anywhere of removal.

[00:14:40] Speaker 00:
Yes, it says you can increase and decrease the pressure.

[00:14:43] Speaker 00:
That's turning up and turning down the hose.

[00:14:46] Speaker 00:
There is nothing anywhere other than their expert speculation.

[00:14:49] Speaker 02:
There is no discussion of speed.

[00:14:51] Speaker 02:
of the sample flow anywhere in this reference.

[00:14:54] Speaker 02:
And yet that's what the claim construction that you agreed upon required.

[00:14:58] Speaker 02:
And now you want me to make assumptions or conclusions about speed when their expert is, in your best case, somewhat equivocal.

[00:15:06] Speaker 02:
But he goes on to explain that not always, and yes it could, but other times it won't because of modulation.

[00:15:14] Speaker 02:
I don't know.

[00:15:15] Speaker 02:
I don't know how I don't

[00:15:16] Speaker 02:
all honesty fault you all because this was your burden and you introduced no evidence to link this up.

[00:15:23] Speaker 00:
Your Honor, we introduced evidence of acceleration.

[00:15:24] Speaker 00:
I'm focusing on theirs for the reason that I mentioned.

[00:15:27] Speaker 00:
The reason why it's not on the face of Neuenhuis is because we're talking about something so basic that he even agreed that it would happen as a matter of the laws of conservation of mass.

[00:15:36] Speaker 00:
You don't have to say that you have to increase the pressure to make it go faster because everyone knows you have to turn up the pressure to make it go faster.

[00:15:41] Speaker 03:
But when you said that agreement, is it really just that part where it was kind of cut off and it said yeah and then there was a little bit

[00:15:46] Speaker 00:
That's the agreement with respect to conservation of mass.

[00:15:49] Speaker 00:
His testimony with respect to our device, it's true, but it's the same feature at 5422.

[00:15:54] Speaker 00:
He says you add fluid that makes it go faster.

[00:15:57] Speaker 00:
Our expert says the same at 51786.

[00:15:59] Speaker 00:
Again, this wasn't even a reason on which they defended the verdict below because it was so apparent to everyone involved that more fluid means faster, as I said with the shower or the garden hose example.

[00:16:10] Speaker 00:
You can't create a fact issue.

[00:16:12] Speaker 00:
You can't create substantial evidence.

[00:16:15] Speaker 00:
with an expert speculation about something, he acknowledged that there would be narrowing.

[00:16:22] Speaker 00:
And then he said, it's possible if you modulate the flow rates to avoid it, it's possible to break it.

[00:16:27] Speaker 00:
It's possible to turn it off.

[00:16:28] Speaker 00:
This is a device claim and it's capable of practicing.

[00:16:31] Speaker 00:
We didn't talk about compression.

[00:16:33] Speaker 00:
I know that I'm into rare bottle time.

[00:16:34] Speaker 00:
It sounds like that's not where the court's questions are focused, but I'm happy to address it.

[00:16:37] Speaker 03:
Do you want to touch on damages at all?

[00:16:39] Speaker 00:
I would love to just say one thing about them, if I may, which is just that

[00:16:44] Speaker 00:
The simple issue, I'll leave the assailable unit to the side, is that Malachowski's analysis attributes 100% of the value of the chips to the patents.

[00:16:54] Speaker 00:
We give the demonstrative on page 78 of our blue brief to show you what I'm talking about.

[00:16:58] Speaker 00:
The problem is there are undisputedly non-infringing features which contribute to focusing, which is the key functionality.

[00:17:06] Speaker 00:
He didn't distinguish between what is penned and what isn't.

[00:17:10] Speaker 00:
And we know that those non-infringing features, particularly what's called Detailed B, 25388 for later, of the joint appendix, you'll see the picture.

[00:17:18] Speaker 00:
Detailed B

[00:17:19] Speaker 00:
is present in our non-infringing chip, which works just as well as the infringing.

[00:17:23] Speaker 02:
Did you have an opportunity to introduce that evidence at trial?

[00:17:29] Speaker 00:
Absolutely.

[00:17:29] Speaker 00:
But the problem is that this is an abuse of discretion to have allowed Mr. Malachowski to testify based on an erroneous theory, a legally unreliable theory.

[00:17:37] Speaker 00:
This is a challenge to the admission of the evidence.

[00:17:39] Speaker 02:
Well, I understand.

[00:17:40] Speaker 02:
But I guess I'm wondering if that challenge about what causes the value

[00:17:48] Speaker 02:
to the chips, whether it's the person's contribution or potentially non-infringing features, as you suggested, why that isn't potentially going to wait as opposed to admissibility.

[00:17:59] Speaker 00:
So this court has a long string of cases in which an expert's failure to properly apportion is seen as part of the court's gatekeeping rule.

[00:18:09] Speaker 00:
You can't have a jury hear about numbers that don't reflect at least an effort to make a proper apportionment.

[00:18:13] Speaker 00:
And he went a certain distance, but he stopped at the chip.

[00:18:16] Speaker 00:
In our contention,

[00:18:17] Speaker 00:
is that the failure to do anything with respect to proportioning the non-infringing components versus the infringing components renders his testimony unreliable.

[00:18:25] Speaker 00:
The jury shouldn't have heard it.

[00:18:27] Speaker 00:
The jury, and therefore, were entitled to any trial and damages.

[00:18:32] Speaker 02:
Tell me again, what exactly was exactly wrong with this testimony that should have made it so unreliable it couldn't have been admitted?

[00:18:42] Speaker 00:
So the exact issue that I want to focus on is that, and again,

[00:18:47] Speaker 00:
Blue brief page 78 shows the trial demonstrative.

[00:18:49] Speaker 00:
There's corresponding testimony I can point you to as well.

[00:18:52] Speaker 00:
He says, two out of six steps are carried out by the chip, on the chip.

[00:18:59] Speaker 00:
Then he says, two out of six, that's 33%.

[00:19:00] Speaker 00:
33% of the value of the processing

[00:19:06] Speaker 00:
therefore is attributable to the patents.

[00:19:09] Speaker 00:
So the expert equates the chip with the patents.

[00:19:13] Speaker 00:
It was incumbent on him, because there are both infringing and non-infringing features of the chip that contribute to its function undisputedly, and I can show you why, it was incumbent on him to make a further apportionment.

[00:19:24] Speaker 00:
He didn't do that.

[00:19:26] Speaker 00:
We asked the court to exclude the testimony.

[00:19:28] Speaker 00:
Initially, the portion was even worse.

[00:19:30] Speaker 00:
The district court tried to get him to a portion, a portion, a portion, and he threw up his hand.

[00:19:34] Speaker 02:
Originally, there was this 50% the district court made him adjust, and he did.

[00:19:39] Speaker 02:
And you're saying he didn't adjust enough.

[00:19:41] Speaker 02:
They should have excluded again.

[00:19:42] Speaker 02:
Is that your point?

[00:19:43] Speaker 00:
My point is that he didn't ultimately.

[00:19:46] Speaker 00:
He can make all the different percentages he wants.

[00:19:48] Speaker 00:
He didn't get down to the value of the infringing features.

[00:19:50] Speaker 00:
And notably, when the district court said, 50%, that's too high,

[00:19:54] Speaker 00:
They checked.

[00:19:55] Speaker 00:
Is 30% the limit?

[00:19:56] Speaker 00:
And what do they come back with?

[00:19:57] Speaker 00:
30%.

[00:19:58] Speaker 00:
So I don't think that the story of the exclusion is bad for us.

[00:20:03] Speaker 00:
I think it's quite good for us.

[00:20:04] Speaker 00:
But in terms of the case law, you can forget about the story of the exclusion and focus on one thing.

[00:20:08] Speaker 00:
He equates the chip's value to the patent's.

[00:20:11] Speaker 00:
That doesn't work because there are non-infringing features.

[00:20:14] Speaker 00:
And we know that those non-infringing features are important because number one, they accuse them of infringement initially until we went on summary judgment.

[00:20:20] Speaker 00:
And number two, the new chip that we had at trial

[00:20:24] Speaker 00:
we switched to, no impact on cost or performance, that had the non-infringing features, and it dropped the infringing ones.

[00:20:30] Speaker 03:
Did you contend that your expert provided proper apportionment, like kind of a counter testimony on that?

[00:20:36] Speaker 00:
Yes.

[00:20:36] Speaker 00:
Now, there's a little bit of confusion.

[00:20:38] Speaker 00:
Our expert's testimony actually at trial was not based on this start with the total profits and work down.

[00:20:45] Speaker 00:
It was based on start with a cost of switching and work up.

[00:20:48] Speaker 00:
So they say, and the district court said this,

[00:20:52] Speaker 00:
that, well, since their expert relied on our expert's methodology, everything's fine.

[00:20:56] Speaker 00:
The our expert's methodology is an alternative theory in her report, which she didn't present, which she used to demonstrate why their apportionment was so bad.

[00:21:04] Speaker 00:
But at the end of her analysis, and this is at 24.099 of the Joint Appendix, she says, yeah, get down to the chip, and further apportionment would likely be necessary even there.

[00:21:14] Speaker 00:
But she didn't need to show more because it showed already that Mr. Malkowski's analysis was wildly off base.

[00:21:20] Speaker 03:
For her, I think it was 12.5%.

[00:21:22] Speaker 00:
You're saying that's not even the right... That's not her theory.

[00:21:26] Speaker 00:
She didn't advance it at trial.

[00:21:27] Speaker 00:
And as I said, it was an alternative exercise.

[00:21:30] Speaker 00:
Her main theory was based on evidence that existed earlier about the cost of switching, which was 48 cents, and she said that should be the royalty.

[00:21:38] Speaker 00:
Joy didn't credit that, and we're not appealing that issue.

[00:21:40] Speaker 00:
I'm just saying that that wasn't her theory at trial.

[00:21:45] Speaker 02:
Okay.

[00:21:45] Speaker 02:
Well, we'll restore some rebuttal time.

[00:21:47] Speaker 02:
Why don't we hear from Mr. Shaw?

[00:22:00] Speaker 04:
May it please the court, Patik Shaffer, APLE is known here as ST.

[00:22:05] Speaker 04:
The question in this case, and I'm going to start with the anticipation issue, is whether a rational juror could have found that ABS failed to prove by clear and convincing evidence that Neuenheist disclosed

[00:22:19] Speaker 04:
all the elements of the claim.

[00:22:21] Speaker 04:
And most of the call we hear was about the acceleration element.

[00:22:25] Speaker 04:
And so let me start there.

[00:22:27] Speaker 03:
Chief Judge Moore, you... Can you speak on the other element that we talked about, the compression element?

[00:22:32] Speaker 03:
Yeah.

[00:22:32] Speaker 03:
That Moonheist does disclose it?

[00:22:34] Speaker 04:
No, I do not concede.

[00:22:35] Speaker 04:
Oh, okay.

[00:22:36] Speaker 03:
I was going to ask.

[00:22:37] Speaker 04:
No, no, no, not at all.

[00:22:38] Speaker 04:
I'm happy to talk about that as well.

[00:22:40] Speaker 03:
I just wanted to know, because we're moving on to Acceleration, which is where I want you to focus, but I just thought I might get a concession on the way.

[00:22:46] Speaker 04:
No, no, no, not at all.

[00:22:49] Speaker 04:
On Acceleration though, so just to be clear here, their ex, Nieuwenhuis, start with Nieuwenhuis, the actual prior art

[00:22:57] Speaker 04:
does not mention acceleration in any way, shape, or form.

[00:23:01] Speaker 04:
It's just not in there.

[00:23:02] Speaker 04:
It doesn't talk about the velocity, the speed, anything of the flow that's going on in the invention.

[00:23:07] Speaker 04:
It's not in the article.

[00:23:08] Speaker 01:
So you would expect... Is this your argument?

[00:23:11] Speaker 01:
I mean, where in the red brief did you focus on acceleration?

[00:23:14] Speaker 01:
I thought the focus of your argument was on the fact that it said minimal, and it could have been so minimal as a not really amount to compression.

[00:23:23] Speaker 04:
So Your Honor, we were the appellees.

[00:23:25] Speaker 04:
So their primary argument in their brief focused on compression, compression, compression.

[00:23:30] Speaker 04:
So most of our brief rebuts that element.

[00:23:32] Speaker 04:
However, even though they did not mention acceleration, our brief does.

[00:23:37] Speaker 04:
We have an entire section, a subsection in our brief,

[00:23:41] Speaker 04:
And it starts, it's subsection 2, C3, Basic Principles of Physics Cannot Save ABS's Anticipation Defense.

[00:23:50] Speaker 04:
That entire section... What page?

[00:23:53] Speaker 04:
It's 42 of our brief, Your Honor.

[00:23:56] Speaker 04:
Let me just read it.

[00:23:57] Speaker 04:
Let me make sure I'm giving you the right page.

[00:24:10] Speaker 04:
Yeah, this is the right section.

[00:24:11] Speaker 04:
So 42 and 43 of our brief is where we address the principles of physics.

[00:24:18] Speaker 02:
And let's really say on 43, ABS has no other basis for proving that UN House discloses the acceleration element of the district court's focusing.

[00:24:26] Speaker 04:
Right.

[00:24:27] Speaker 04:
Dr. DiCarlo, that's their expert, did not speak to the subject.

[00:24:31] Speaker 04:
ABS's bid to overturn the jury's anticipation verdict fails on that additional basis as well.

[00:24:37] Speaker 04:
That's the point of the section in 42, 43.

[00:24:39] Speaker 04:
Again, they didn't mention it in their opening brief, the second element of it.

[00:24:44] Speaker 04:
We affirmatively addressed it and say, here's another basis on which to win, and it is an independent basis.

[00:24:50] Speaker 04:
And I want to explain exactly why it's laid out in those two pages.

[00:24:54] Speaker 04:
But their expert did not opine on this at all.

[00:25:00] Speaker 04:
Never says that Neuenheiss shows that there's acceleration of the stream.

[00:25:04] Speaker 02:
Our expert... But didn't their expert, in the context of infringement, make arguments about laws of physics that could have likewise applied here?

[00:25:14] Speaker 04:
could have, but there's no reason to think that it would have applied to the portion of the reference that we're talking about here in Neuenheiss.

[00:25:23] Speaker 04:
They were talking about the infringing device.

[00:25:25] Speaker 04:
We're talking about Neuenheiss and whether figure four of Neuenheiss in that configuration

[00:25:31] Speaker 04:
actually causes acceleration.

[00:25:33] Speaker 04:
And our expert does address it head on.

[00:25:36] Speaker 04:
And at first, as you had the colloquy with Mr. Horowitz, their attorney tried to cross-examine our witness and ask the question that you heard there.

[00:25:51] Speaker 04:
That's the

[00:25:53] Speaker 04:
You would agree with me, because the channel doesn't change in dimension here, when sheath fluid is added at the vertical position inlet, the laws of conservation of mass and momentum dictate that both the sheath fluid and the sample fluid

[00:26:12] Speaker 04:
Accelerate at that point, correct?

[00:26:14] Speaker 04:
Yeah.

[00:26:14] Speaker 04:
Actually, I'm glad you brought that up, because then he's cut off.

[00:26:19] Speaker 04:
So then on redirect examination, we come back to this point.

[00:26:24] Speaker 04:
And that starts at the passage that you were looking at before, at the bottom of 51175.

[00:26:31] Speaker 04:
And this is on redirect, says, I believe Ms.

[00:26:35] Speaker 04:
Koh, referring to that testimony I just read, asked you whether the laws of conservation of mass necessarily require there to be focusing at the vertical position inlet.

[00:26:45] Speaker 04:
And I think you tried to respond and elaborate.

[00:26:48] Speaker 04:
You disagreed in this case.

[00:26:50] Speaker 04:
Can you explain what about the vertical direction?

[00:26:53] Speaker 04:
And then he says, Newenheiss has the sample stream moving up and down.

[00:26:57] Speaker 04:
based on introducing sample, introducing sheaf flow at a faster rate or a lower rate in order to do exactly the same positioning control.

[00:27:05] Speaker 04:
That's what Newenheiss Figure 4 shows.

[00:27:07] Speaker 04:
And the next question, so is there necessarily focusing in the vertical direction simply because the way Newenheiss is configured

[00:27:15] Speaker 04:
There's fluid being added at the vertical position in let answer, not necessarily, because there's also this modulation of the flow rates that's going on at the same time.

[00:27:27] Speaker 04:
So Judge Hughes, to get to your question.

[00:27:28] Speaker 04:
I'm confused.

[00:27:29] Speaker 01:
I mean, it doesn't sound like he's answering the same question that he was asked, which is all other things being the same if you add liquid without the modulation.

[00:27:41] Speaker 01:
He's talking about modulation and stuff, which I understand to be somewhat different.

[00:27:45] Speaker 01:
If you add liquid, which results in compression, no matter how minor it is, is it theoretically possible that there's no acceleration?

[00:27:56] Speaker 04:
Well, Your Honor, he is saying that what's going on in new impacts.

[00:28:00] Speaker 01:
See, this is a problem.

[00:28:01] Speaker 01:
I think you're pointing, I wish they would have let him finish answering that question.

[00:28:07] Speaker 01:
But the first question is, is it theoretically possible to add liquid to

[00:28:14] Speaker 01:
something with this diameter, the way everything else stays the same, and assuming it discloses compression and focusing, which I read from Newhouse, if you have compression and focusing, is it theoretically possible that there's no

[00:28:33] Speaker 01:
acceleration.

[00:28:35] Speaker 01:
Don't answer me with questions about modulation and how the device works, just theoretically possible and kind of the abstract.

[00:28:42] Speaker 01:
I am not a physicist, so I don't know the answer to that, but what I can tell you... Maybe because they didn't put enough evidence in, but I'm a little curious as to, because it doesn't seem like a particularly difficult concept, that if you have liquid flowing through a tube,

[00:28:57] Speaker 01:
and you add more, it's going to compress it, which is going to cause it to move faster.

[00:29:01] Speaker 04:
Okay.

[00:29:01] Speaker 04:
Your Honor, again, that might be right.

[00:29:03] Speaker 04:
They didn't put that on.

[00:29:04] Speaker 04:
But what is going on in Neuenheise is what our expert says.

[00:29:08] Speaker 04:
There is modulation of flow rates in Neuenheise.

[00:29:11] Speaker 04:
That's the whole point of Figure 4 in Neuenheise.

[00:29:14] Speaker 04:
And our expert spends pages 11, 22, all the way to

[00:29:19] Speaker 04:
511, 22 to 30.

[00:29:22] Speaker 04:
So what modulation is?

[00:29:24] Speaker 01:
Liquid or subtracting liquid?

[00:29:26] Speaker 04:
No.

[00:29:27] Speaker 04:
Modulation just means change in flow rate.

[00:29:30] Speaker 04:
So what modulation means is two ways you can modulate.

[00:29:34] Speaker 04:
So Mr. Horowitz talked about the horizontal ports.

[00:29:37] Speaker 04:
That's not an issue.

[00:29:38] Speaker 01:
I don't want to talk about the horizontal ports.

[00:29:39] Speaker 04:
I don't want to talk about it either.

[00:29:41] Speaker 04:
what modulation the expert is referring to, our expert in that redirect, where he's precisely addressing the exact question they cut him off on, he's saying there is modulation.

[00:29:52] Speaker 04:
If you look at the figure in Nuenhuis, for example, figure one or figure three, there's a sheath inlet.

[00:29:59] Speaker 04:
So what the expert is saying is,

[00:30:02] Speaker 04:
Yeah, you can be adding fluid in the vertical inlet, but you're not going to get acceleration, because there is no mass conservation problem, because you're modulating.

[00:30:13] Speaker 04:
That is, you're turning down the sheath inlet fluid that's coming into the system.

[00:30:19] Speaker 04:
So the port at the sheath inlet, this is just kind of, again,

[00:30:23] Speaker 04:
Just to use basic physics, because you're asking me.

[00:30:26] Speaker 01:
If you're turning down... Can I just say it in really, really dumb terms and see if I'm getting it?

[00:30:32] Speaker 01:
The stuff coming from the beginning.

[00:30:34] Speaker 04:
Yes.

[00:30:34] Speaker 01:
Right.

[00:30:35] Speaker 01:
So if that stayed the same and you added...

[00:30:38] Speaker 01:
liquid from the vertical, that would probably cause acceleration.

[00:30:41] Speaker 04:
We don't have testimony, but I'm willing to accept that.

[00:30:44] Speaker 04:
Yeah.

[00:30:44] Speaker 01:
But what he's saying is, Neuenhaus doesn't necessarily disclose it.

[00:30:47] Speaker 01:
It discloses modulation, where maybe you're adding, but you're also turning down the flow at the beginning.

[00:30:54] Speaker 01:
which wouldn't cause exaltation.

[00:30:55] Speaker 04:
That is exactly right.

[00:30:57] Speaker 04:
Our expert is a hundred percent correct.

[00:30:58] Speaker 02:
It doesn't even have to be exactly right, right?

[00:31:00] Speaker 02:
It just has to be plausible because of the standard of review.

[00:31:03] Speaker 04:
Absolutely, Your Honor.

[00:31:04] Speaker 02:
This is exactly right and go overboard.

[00:31:06] Speaker 02:
Go ahead.

[00:31:06] Speaker 02:
We don't have to agree with you.

[00:31:09] Speaker 04:
Sure.

[00:31:09] Speaker 04:
I won't overdo it because you're exactly right.

[00:31:12] Speaker 02:
You are exactly right.

[00:31:13] Speaker 02:
Are you really capable of writing that in?

[00:31:15] Speaker 02:
I don't know.

[00:31:16] Speaker 02:
Let's see.

[00:31:17] Speaker 04:
You are exactly right that the question is whether a rational juror

[00:31:22] Speaker 04:
could have found that ABS failed to prove by clear and convincing evidence that Neuenheiss disclosed all the elements of the claim.

[00:31:30] Speaker 04:
Their expert, again, does not address acceleration in Neuenheiss.

[00:31:35] Speaker 04:
Our expert does and says, no, you're not necessarily going to get acceleration.

[00:31:40] Speaker 04:
And in fact, you don't in figure four.

[00:31:43] Speaker 04:
And again, our expert at length discusses figure four, which is the... Sorry.

[00:31:47] Speaker 01:
I'm going to ask it in a dumb way again.

[00:31:49] Speaker 01:
But if you don't get...

[00:31:53] Speaker 01:
acceleration because there's the modulation.

[00:31:59] Speaker 01:
So the flow at the beginning has changed.

[00:32:02] Speaker 01:
Is there any compression though?

[00:32:04] Speaker 01:
No, I don't think that again.

[00:32:06] Speaker 01:
So here's where I'm still struggling is that sounds right that new in house doesn't always say automatically there can be compression, but it does recognize that there can be compression and

[00:32:22] Speaker 01:
compression seems to be acceleration.

[00:32:26] Speaker 01:
What you're telling me about when you modulate and you put some in the vertical but you slow down the flow,

[00:32:37] Speaker 01:
so there's no acceleration.

[00:32:38] Speaker 01:
Wouldn't that also mean there's no compression?

[00:32:40] Speaker 04:
Well, I don't think necessarily, Your Honor.

[00:32:43] Speaker 04:
And again, this is a mass conservation principle.

[00:32:46] Speaker 04:
The reason why everyone would say the modulation is the key to the acceleration of the flow rate is there has to be a constant.

[00:32:54] Speaker 04:
What comes in has to come out, right?

[00:32:57] Speaker 04:
It has to be the same mass balance in chemical engineering terms, right?

[00:33:00] Speaker 04:
Mass balance in, mass balance out.

[00:33:02] Speaker 04:
So if you're putting

[00:33:04] Speaker 04:
less in, whether there's compression or not.

[00:33:08] Speaker 04:
And then you're adding some as long as the same is coming in and out.

[00:33:13] Speaker 04:
total is coming in and out at the same time, then there's no acceleration that needs to be done.

[00:33:20] Speaker 04:
So basically, put it this way.

[00:33:22] Speaker 01:
I'm trying to follow this, so I think I understand.

[00:33:24] Speaker 01:
But that example you just gave us, would that involve any compression or focusing, though?

[00:33:30] Speaker 04:
I don't think necessarily, your honor, because here, what we have here.

[00:33:34] Speaker 01:
And let me just, I won't labor this, because you're running out of time, and you probably want to talk about damages.

[00:33:42] Speaker 01:
What I'm concerned is your example doesn't show acceleration, but it sounds like it also doesn't show compression or focusing.

[00:33:53] Speaker 01:
explicitly discloses some type of compression or focusing?

[00:33:56] Speaker 04:
Your Honor, again, the mass conservation doesn't tie to compression, so I can't answer that question.

[00:34:01] Speaker 04:
What I will tell you is, our expert, their expert does not mention figure four of Neuenhuis.

[00:34:09] Speaker 04:
Figure four of Neuenhuis is the computer simulation that's designed to show what's happening in flow cell two.

[00:34:16] Speaker 04:
and he at length describes figure four and you can look at it and what you see there is as the vertical flow rate increases these are the three boxes you see the sample stream which is the red yellow and green bubble that bumps up

[00:34:32] Speaker 04:
What you don't see is any evidence of compression.

[00:34:35] Speaker 04:
And he testifies to this.

[00:34:36] Speaker 04:
He says, if there were going to be compression, this is now moving to the compression element as you brought up Judge Hughes, you would see it.

[00:34:43] Speaker 04:
And the proof of that is, look on the prior page of the New and Heist, where they're doing the same computer simulation for figure one.

[00:34:51] Speaker 02:
Friendly question.

[00:34:52] Speaker 02:
Is it fair to say the following?

[00:34:54] Speaker 02:
It may not be entirely clear what the word compression truly teaches a skilled artisan in Nuenhuis in light of figure four, but that wasn't your burden.

[00:35:04] Speaker 02:
It was theirs, given they were seeking to anticipate, and that the evidence of record at least is substantial enough to affirm what was decided.

[00:35:11] Speaker 04:
Couldn't have said it better, Your Honor.

[00:35:13] Speaker 04:
Agreed.

[00:35:14] Speaker 04:
I'm happy to address damages.

[00:35:19] Speaker 04:
I think, Your Honor, look, this district court went out of its way, both at multiple junctions in the hearing, to review the expert testimony, narrow it, had a voir dire beforehand, and said, look, I'm going to allow you to testify to some of these disputed issues.

[00:35:35] Speaker 02:
What about the fact that the expert didn't appear to take into account non-infringing features that may add value?

[00:35:42] Speaker 04:
Your Honor, the expert did take that into account, and that was part of the boardier colloquy they actually had with the court.

[00:35:48] Speaker 02:
Can you show me where that is?

[00:35:53] Speaker 02:
Where is that?

[00:35:53] Speaker 04:
Yes, let me pull that up for you.

[00:35:56] Speaker 04:
That was one of the persons that just made the... 51089 to 92.

[00:36:04] Speaker 04:
Let me just make sure I'm giving you the right pages.

[00:36:07] Speaker 04:
Let me just maybe look at them before I take you down the wrong line.

[00:36:12] Speaker 02:
I'm going to give him a little more time because he ran out for rebuttal, so don't worry about the clock right now.

[00:36:28] Speaker 02:
I don't see anything on 51089.

[00:36:29] Speaker 04:
Ah, here we go.

[00:36:36] Speaker 04:
this is so they're challenged to this testimony that starts on five oh one eight nine this is the word here about what methodologies using and this is the diagram in the briefs that both sides reproduced about the national that confidential uh... let's see if it's not confident that's an exit yes yes the exit the exit diagram is that confidential uh...

[00:37:09] Speaker 02:
Is the pricing that's my understanding to okay so the expert To the so to the extent that the expert said which of the steps were crossed off and not you don't neither of you see any confidential information and I don't see any confidential Right, yes, but who knows what the opinion might do so I just want on the record that it's not confident

[00:37:32] Speaker 04:
Right.

[00:37:32] Speaker 04:
And so what you have here is them challenging our expert's use of the very methodology that, and the court points this out, that it was their expert that kind of used this X methodology, right?

[00:37:45] Speaker 04:
And our expert crosses out all of the steps that are common to sexing and non-sexing steps in this process.

[00:37:54] Speaker 02:
Sorry, what page is that thing again?

[00:37:56] Speaker 04:
It's 58 and 59 of the red brief, Your Honor.

[00:38:08] Speaker 02:
This is a terrible reproduction, you realize that.

[00:38:11] Speaker 02:
It gave me something completely blurry and unrevealed.

[00:38:13] Speaker 04:
Okay, yeah.

[00:38:14] Speaker 04:
I mean, I don't think the labels necessarily matter, but the point is that, and this tracks the testimony that I pointed you, 51090 to 5092, where basically their argument in this vorge, or trying to exclude this methodology, was like, hey, look,

[00:38:33] Speaker 04:
He's not x-ing out the right steps, or x-ing out enough steps, or including.

[00:38:38] Speaker 04:
And what the judge says is, this is all very good.

[00:38:42] Speaker 04:
And this is at 51.092.

[00:38:43] Speaker 04:
This is a very good cross-examination.

[00:38:47] Speaker 04:
But it's not something that a judge needs to exclude.

[00:38:50] Speaker 04:
The methodology is fine.

[00:38:52] Speaker 04:
What you guys are arguing over is, what are the steps?

[00:38:55] Speaker 02:
Or which steps should be taken into account, which ones?

[00:38:57] Speaker 04:
which ones should be taken into account and which ones shouldn't.

[00:39:01] Speaker 04:
And that's quintessentially a jury question.

[00:39:03] Speaker 04:
And they were free to make any of these arguments.

[00:39:05] Speaker 04:
And in fact, they did make these arguments to the jury.

[00:39:08] Speaker 04:
And the jury here did what a jury is supposed to do.

[00:39:11] Speaker 04:
It did not accept the royalty number that our expert submitted.

[00:39:15] Speaker 04:
It knocked it down and came somewhere in between the number we submitted and the number they submitted.

[00:39:21] Speaker 04:
And the other argument, the other point I would

[00:39:23] Speaker 02:
What about the smallest saleable unit issue?

[00:39:26] Speaker 04:
Yeah, so that one I think is easy, which is why I think Mr. Horowitz didn't bring it up.

[00:39:31] Speaker 04:
That doesn't help you.

[00:39:33] Speaker 04:
Yeah, so let me explain why the saleable unit doesn't get traction here.

[00:39:39] Speaker 04:
That's because the ABS's sales here, the vast, vast majority of their business was selling finished product semen straws.

[00:39:52] Speaker 04:
And so the way the expert said, that's what I have data about.

[00:39:56] Speaker 04:
Perhaps the only smallable saleable unit, although the judge points out that they didn't propose a true smaller saleable unit, would be the sex sorting service itself.

[00:40:07] Speaker 04:
The problem was, at the time of the infringement, they had entered into, I think, all of two sex sorting agreements.

[00:40:14] Speaker 04:
And so our witness said,

[00:40:15] Speaker 04:
That doesn't give me enough data to make a reliable price point."

[00:40:19] Speaker 04:
And the court accepted that and said, look, yeah, in light of this, and this is in Commonwealth Scientific, this court has said a number of times, it depends on the facts of the case, what data is available.

[00:40:29] Speaker 04:
Here, the best available data were the finished straws.

[00:40:32] Speaker 04:
And he then, he didn't just use the finished sexed semen straws, he subtracted out the unsexed semen straws.

[00:40:38] Speaker 04:
to try to isolate what value is getting from sex sorting, that was step one, the smallest saleable unit type step.

[00:40:46] Speaker 04:
What is your baseline?

[00:40:47] Speaker 02:
Is there some sales of just the chips?

[00:40:50] Speaker 04:
No, Your Honor.

[00:40:52] Speaker 04:
Not to my understanding.

[00:40:54] Speaker 04:
I think there is one reference to sales of chips.

[00:40:58] Speaker 04:
I don't even know if those are the same chips.

[00:41:00] Speaker 04:
And it's certainly not the core of their business.

[00:41:02] Speaker 04:
And that's what the judge finds.

[00:41:04] Speaker 04:
And so that was step one, saying, OK,

[00:41:06] Speaker 04:
I'm going to try to come up with a baseline.

[00:41:08] Speaker 04:
I'm going to subtract out the unsex straws so I can isolate the sex sorting services.

[00:41:13] Speaker 04:
Then we go to further apportionment on those diagrams, the blurry diagrams that I pointed to you.

[00:41:18] Speaker 04:
That's where he's going to say, OK, now I've got the sex sorting.

[00:41:23] Speaker 03:
You won't take a breath.

[00:41:24] Speaker 03:
He doesn't do it.

[00:41:25] Speaker 03:
I'm trying to jump in.

[00:41:26] Speaker 03:
You can jump.

[00:41:27] Speaker 03:
Just on the apportionment point one more time here.

[00:41:29] Speaker 03:
So I've got, hopefully, a better resolution of this chart than I'm staring at.

[00:41:33] Speaker 03:
And I see that there are all these x's and certain things crossed out.

[00:41:35] Speaker 03:
And what was not crossed out is that still incorporates some unpatented features, is what I'm trying to get at.

[00:41:42] Speaker 04:
Yeah, so I think what their argument would be, and we wouldn't dispute, is this.

[00:41:47] Speaker 04:
Once you isolate all of these things out, use a portion to portion to portion, what you're left with is on the chip.

[00:41:56] Speaker 04:
The chip has the focusing, the infringing,

[00:41:58] Speaker 04:
features that we're talking about.

[00:42:01] Speaker 04:
The chip also does some other things.

[00:42:05] Speaker 04:
Really the only other thing I think that they point to is this region B, which is another form of focusing.

[00:42:10] Speaker 04:
And what our expert says, and again there is testimony on this, the jury could decide this, our expert said what's driving the value of the chip there is the claimed focusing features.

[00:42:22] Speaker 04:
That's driving the value.

[00:42:24] Speaker 04:
So the fact that you can't subtract out

[00:42:26] Speaker 04:
every single other feature, when it's not driving the value, and there's plenty of case law from this court, doesn't render that apportionment infirm.

[00:42:36] Speaker 04:
And certainly, remember, what they're bringing is exclusion.

[00:42:39] Speaker 04:
They want to exclude the expert's testimony.

[00:42:42] Speaker 04:
They're saying it's so unreliable, exclude it.

[00:42:45] Speaker 04:
It's a jury question.

[00:42:46] Speaker 04:
If they want to try to argue that when our expert said, oh, look, the patented features are what's driving the focusing and not this region B that they point to,

[00:42:56] Speaker 04:
The jury could have agreed with them and didn't.

[00:42:59] Speaker 02:
OK, thank you very much, Mr. Shaw.

[00:43:01] Speaker 04:
Thank you.

[00:43:02] Speaker 02:
He went over by almost six minutes.

[00:43:04] Speaker 02:
So give an equal amount.

[00:43:07] Speaker 02:
Did he have anything left, or was he over?

[00:43:09] Speaker 02:
How far over, like two or three?

[00:43:12] Speaker ?:
Six minutes.

[00:43:13] Speaker 02:
All right, you can know about kidding.

[00:43:14] Speaker 02:
We'll give you three minutes, which is what you'd originally asked for, right?

[00:43:17] Speaker 02:
Or you asked for five.

[00:43:18] Speaker 02:
Sorry, you're getting three.

[00:43:20] Speaker 00:
I appreciate the court's indulgence in any event.

[00:43:21] Speaker 00:
Judge Hughes, you asked the question, do compression

[00:43:25] Speaker 00:
acceleration go hand in hand.

[00:43:27] Speaker 00:
The best testimony on this is our expert's testimony, and this is where I wanted to start in terms of explaining the background, 50786 of the Joint Appendix, where he explains what happens with focusing by adding sheath fluid.

[00:43:39] Speaker 00:
Again, the assumption in all of these cases is you hold all else constant.

[00:43:43] Speaker 00:
It is of course true that if you turn off things or turn down things, or break the chip into pieces, it stops working.

[00:43:50] Speaker 00:
But if you use everything exactly the same way, and you add fluid to a channel that has constant dimensions,

[00:43:57] Speaker 00:
our expert at 786-5786 explains, you're going to have compression, and with that you're going to have acceleration.

[00:44:03] Speaker 00:
There's no contrary testimony.

[00:44:05] Speaker 00:
There's merely the speculation that one could remove sheet fluid elsewhere while adding sheet fluid at vertical position inlet.

[00:44:12] Speaker 00:
Nudize never says that you should do that, and it teaches that there is compression.

[00:44:17] Speaker 00:
There is no way a reasonable jury can accept the speculation that it's possible to operate the device in non-infringing ways.

[00:44:24] Speaker 00:
say it like that.

[00:44:25] Speaker 00:
It's possible to do that.

[00:44:26] Speaker 00:
The device absolutely has the capability and it is the intention that it control the dimensions of the sample.

[00:44:33] Speaker 02:
That's with respect to... Can I understand something about 50786?

[00:44:37] Speaker 02:
Yes.

[00:44:38] Speaker 02:
It seems to be talking about visuals in terms of... Now you can see there are arrows, they're getting longer, that's what this means.

[00:44:48] Speaker 02:
I don't know what it's talking about and on the prior page

[00:44:51] Speaker 02:
It looks like he has prepared some animations on all of this.

[00:44:55] Speaker 00:
Yeah, so I can give you the context for that.

[00:44:57] Speaker 02:
Yeah, help me.

[00:44:58] Speaker 00:
So first of all, to the extent that it's useful, the structure of the testimony is here's how focusing works in the various devices I'm going to talk about.

[00:45:08] Speaker 00:
And then he talks about focusing without repeating every time that acceleration happens.

[00:45:12] Speaker 00:
So that's why it's not new and high specific.

[00:45:15] Speaker 00:
In the blue brief at page 12, you can see

[00:45:19] Speaker 00:
The demonstrative that he was using for purposes of explaining focusing by adding sheath fluid, and then on page 13, you can see the focusing by narrowing the channel.

[00:45:28] Speaker 00:
That's not what I'm talking about, but I'm just saying these demonstratives link up to what he was talking about.

[00:45:35] Speaker 00:
So the arrow is getting longer.

[00:45:36] Speaker 00:
They are animations as well, but you can see them even in the picture.

[00:45:41] Speaker 00:
The arrows are short, and then they get longer.

[00:45:43] Speaker 00:
So that's the correspondence.

[00:45:44] Speaker 02:
Just to be clear, this is an expert's demonstrative.

[00:45:47] Speaker 00:
It's a demonstrative.

[00:45:47] Speaker 00:
His testimony is that,

[00:45:49] Speaker 00:
All the fluid has to accelerate as the fluid is getting faster.

[00:45:54] Speaker 00:
It's very hard to talk about what happens in channels of a millimeter thick without showing some pictures.

[00:45:59] Speaker 03:
Is it true that your expert did not give testimony on acceleration and that new in-house reference?

[00:46:05] Speaker 00:
He didn't specifically link up acceleration in Neuenheiss in so many words.

[00:46:09] Speaker 00:
What he did was he talked about focusing in general and how it works by adding sheath fluid.

[00:46:12] Speaker 00:
There were a couple of references.

[00:46:14] Speaker 00:
He talked about another reference, Weigel, add sheath fluid.

[00:46:17] Speaker 00:
Neuenheiss works the same way.

[00:46:18] Speaker 00:
So he doesn't, again, the structure of the direct was, here's how focusing works.

[00:46:23] Speaker 00:
Here's what happens when you add the sheath fluid.

[00:46:24] Speaker 00:
And that happens in Neuenheiss.

[00:46:26] Speaker 00:
So he didn't specifically go after that.

[00:46:29] Speaker 00:
I'd really love, if I may, just on apportionment, if you'll give me 30 seconds.

[00:46:34] Speaker 00:
Your Honor.

[00:46:36] Speaker 00:
Mr. Shah pointed the court to the voir dire, 51089.

[00:46:41] Speaker 00:
I'd like to bring you to exactly the same place.

[00:46:45] Speaker 00:
And I think he admitted this, and maybe this isn't even necessary.

[00:46:50] Speaker 00:
At the top of 51089, did you make any determination of the technical benefit of having completely non-overlapping features, which is the infringing features as opposed to the non-infringing ones?

[00:47:00] Speaker 00:
Answer, no.

[00:47:01] Speaker 00:
Mr. Shah admitted he stopped at the chip.

[00:47:04] Speaker 00:
The problem is that there are non-infringing features of the chip

[00:47:07] Speaker 00:
They're important.

[00:47:08] Speaker 03:
What about the statement about it driving the value?

[00:47:10] Speaker 03:
What's your response to that?

[00:47:12] Speaker 00:
So Mr. Shah's point is the expert doesn't need to do any further apportionment.

[00:47:18] Speaker 00:
So it can be 100% if he says, that's driving the value.

[00:47:23] Speaker 00:
Respectfully, that's not what the cases say.

[00:47:25] Speaker 02:
Wait, wait, wait.

[00:47:27] Speaker 02:
I think that you're just too fast on this with this.

[00:47:30] Speaker 02:
If the expert says, I've considered the non-infringing features, and they're not what's driving the value

[00:47:36] Speaker 02:
this device or straw or whatever it is, what's driving the value is actually the patented features.

[00:47:41] Speaker 02:
Hasn't he done exactly what our Facebook requires?

[00:47:43] Speaker 02:
He would not agree with it.

[00:47:46] Speaker 00:
So when it comes to the technical features,

[00:47:49] Speaker 00:
He can't just say it's not driving the value.

[00:47:51] Speaker 00:
He has to rely on Dr. Vaca.

[00:47:52] Speaker 00:
The page I just pointed you to, 510899, he's asked, did you make this division?

[00:47:57] Speaker 00:
And he says, I didn't slice it like that.

[00:47:58] Speaker 00:
That's a Vaca question, as in that's a technical question.

[00:48:01] Speaker 00:
So he didn't actually even do it.

[00:48:03] Speaker 00:
He said the words.

[00:48:03] Speaker 00:
I think that they're driving the value.

[00:48:05] Speaker 00:
He shouldn't have been allowed to say any words because he stopped at the chip, admitted that he stopped at the chip, and admitted that further apportionment is a technical question.

[00:48:14] Speaker 03:
Is there an objection made to stop him from saying those words?

[00:48:17] Speaker 00:
The whole Daubert motion is, he didn't apportion.

[00:48:20] Speaker 00:
There wasn't an objection once he started talking.

[00:48:23] Speaker 03:
Yeah, that's what I was asking.

[00:48:24] Speaker 03:
By lying to a child, did you try to object to stop him from saying the words?

[00:48:28] Speaker 00:
The question whether he should have been allowed to testify is clearly preserved.

[00:48:32] Speaker 00:
The question whether that specific Q&A should have been excluded, we're not appealing the issue.

[00:48:36] Speaker 00:
We didn't object at that time.

[00:48:37] Speaker 00:
It was pretty clear what the court was.

[00:48:38] Speaker 02:
And also, he goes on to help me understand.

[00:48:39] Speaker 02:
Maybe I'm misunderstanding this testimony.

[00:48:41] Speaker 02:
But literally, right after the section you read, he goes on to say, your honor, if I may, I started looking at the economics associated with sexting.

[00:48:48] Speaker 02:
And then I identified the six steps that are associated with the economic benefit.

[00:48:52] Speaker 02:
Doesn't that mean the value?

[00:48:54] Speaker 02:
So it does sound like he is claiming he did do some of what you're saying he didn't do.

[00:49:00] Speaker 00:
If you go to the blue brief on page 78, I think this is the simplest explanation.

[00:49:03] Speaker 00:
And again, Mr. Shaw didn't disagree with this.

[00:49:06] Speaker 00:
He did apportionment to his degree.

[00:49:09] Speaker 00:
He said two steps.

[00:49:11] Speaker 00:
There's a disagreement about the number, frankly.

[00:49:13] Speaker 00:
That wasn't what the downward issue was about.

[00:49:15] Speaker 00:
Two steps were attributable.

[00:49:17] Speaker 00:
Carried out by the chip.

[00:49:18] Speaker 00:
That's what it says carried out by the chip six total therefore 33% Attributable to the pants he did the apportionment to the chip level There is absolutely no dispute that there are non infringing features of the chip they previously accused them of infringement at summary judgment that theory was rejected and

[00:49:40] Speaker 00:
Our non-infringing chip has the non-infringing features and not the ones that are accused of infringement.

[00:49:46] Speaker 02:
New lawyers make lots of arguments.

[00:49:47] Speaker 02:
That doesn't necessarily mean those are the value.

[00:49:50] Speaker 02:
They're going to accuse everything of infringement.

[00:49:51] Speaker 00:
It's not zero.

[00:49:52] Speaker 02:
They're saying nothing infringes.

[00:49:53] Speaker 02:
I mean, that's the nature of what you do.

[00:49:54] Speaker 00:
The point is they attribute zero value.

[00:49:57] Speaker 00:
They say 100% comes from these infringing features.

[00:50:01] Speaker 00:
100% of the chip is the patents.

[00:50:04] Speaker 00:
He doesn't go further.

[00:50:05] Speaker 00:
And in the voir dire, he says, further slicing, that's a Vaca question.

[00:50:09] Speaker 00:
Vaca didn't do it.

[00:50:10] Speaker 00:
He didn't do it.

[00:50:11] Speaker 00:
It was incumbent upon him to make the apportionment.

[00:50:13] Speaker 00:
He failed to do so.

[00:50:14] Speaker 00:
His testimony should have been excluded.

[00:50:16] Speaker 02:
OK.

[00:50:16] Speaker 02:
We thank both counsel.

[00:50:17] Speaker 02:
The case is taken under submission.