[00:00:00] Speaker 00:
The last case is Packet Intelligence versus NetScout Systems, 2022-2064.

[00:00:06] Speaker 00:
Mr. Lyons.

[00:00:08] Speaker 00:
Good morning, Your Honors.

[00:00:15] Speaker 02:
Mike Lyons representing NetScout in this appeal.

[00:00:19] Speaker 02:
Your Honor, the decision here should be controlled by your outcome of the prior appeal that you just heard.

[00:00:24] Speaker 02:
Packet Intelligence cannot collect damages

[00:00:28] Speaker 02:
on canceled claims.

[00:00:29] Speaker 02:
And all the claims that were at issue in the Netscout case were canceled in the matter that was just before you.

[00:00:37] Speaker 02:
That's all part of the decision.

[00:00:41] Speaker 02:
The cross-appeal is actually irrelevant to that, because that involves other claims that were not involved in the judgment in the Netscout case.

[00:00:51] Speaker 02:
The law on issue recouped.

[00:00:52] Speaker 00:
You said this is governed by Fresenius.

[00:00:55] Speaker 02:
presented us in the subsequent cases that applied that same doctrine.

[00:00:59] Speaker 02:
Yes, Your Honor.

[00:01:01] Speaker 00:
There was a mandate in the prior case, right?

[00:01:07] Speaker 02:
Yes, there was, Your Honor.

[00:01:09] Speaker 00:
And most of the damages were retained.

[00:01:15] Speaker 02:
Actually, most of them were not retained, but the majority of the compensatory damages, 60%, were actually set aside in the prior case.

[00:01:29] Speaker 02:
And in the prior cases that have applied the doctrine of issue preclusion,

[00:01:38] Speaker 02:
They have explained when it would apply.

[00:01:40] Speaker 02:
And there actually isn't a dispute about the controlling cases or the standard.

[00:01:44] Speaker 02:
And that is, if the case is still pending, the effect of the invalidation of the claims in another proceeding is an immediate issue, preclusive effect on all co-pending cases.

[00:01:55] Speaker 02:
And so the only question is whether this case that is now before you in the Netscout matter is pending.

[00:02:02] Speaker 00:
Do you say it's black and white?

[00:02:03] Speaker 00:
It's not a question of the substantiality of the issues that were remaining?

[00:02:08] Speaker 02:
Well, no, there is a question of whether it's pending.

[00:02:10] Speaker 02:
And the question is whether there are any issues that were allowed.

[00:02:15] Speaker 02:
And the standard for that is undisputed.

[00:02:18] Speaker 02:
A case is pending when it's not yet final in the sense that the litigation is not entirely concluded so that the cause of action against the infringer was merged into a final judgment, one that ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.

[00:02:35] Speaker 02:
That's the standard.

[00:02:36] Speaker 02:
So if there's any more to do,

[00:02:38] Speaker 02:
in this case is pending.

[00:02:39] Speaker 02:
Now, in the Fresenius case, one of the key touchstones of whether a case was still pending was whether the scope of relief remains to be determined.

[00:02:49] Speaker 02:
And Fresenius, they said, now recall, in that case, the appeal had and a mandate had issued resolving infringement, resolving validity, and resolving prejudgment damages in Fresenius.

[00:03:02] Speaker 02:
But it had been remanded to determine the ongoing

[00:03:06] Speaker 02:
royalty, and the court said, well, the scope of relief remains to be determined.

[00:03:11] Speaker 02:
And that's been universally applied.

[00:03:12] Speaker 02:
It was applied recently in the Vernetics case, where over $500 million in damages was set aside.

[00:03:19] Speaker 02:
Even though invalidity and liability had been set aside in the first mandate, the court found a subsequent invalidation would result in an issue of preclusion.

[00:03:29] Speaker 02:
Now here, during the remand, there was a $2.8 million dispute over the enhancement.

[00:03:35] Speaker 02:
The original enhancement was $2.8 million.

[00:03:39] Speaker 02:
Packard Intelligence took the position the enhancement after the remand should be $2.8 million.

[00:03:45] Speaker 02:
They said it shouldn't have changed at all.

[00:03:49] Speaker 02:
It was the position of Netscout at the court who had been directed by the mandate to eliminate the portion of any enhancement that relates to the damages that had been set aside.

[00:04:06] Speaker 02:
NetScout's view was that required the court to go back and look at what would be the appropriate award here of enhancement based on the surviving damages and the new circumstances.

[00:04:18] Speaker 02:
And it should have looked at those factors.

[00:04:20] Speaker 02:
It felt there shouldn't be any enhancement.

[00:04:22] Speaker 02:
The court did a third path.

[00:04:24] Speaker 02:
So both parties disagreed with what the court actually did.

[00:04:28] Speaker 02:
The court awarded about $1.1 million.

[00:04:30] Speaker 02:
Packet Intelligence now says that was sort of the inevitable result.

[00:04:34] Speaker 02:
They fought it below, they argued it was wrong, they said you shouldn't do that proportional dispute.

[00:04:41] Speaker 02:
NetScout agreed that was the incorrect approach and is now appealing that.

[00:04:47] Speaker 02:
But that wasn't the only issue that means this case was still ongoing.

[00:04:51] Speaker 01:
There also was an issue of the... Isn't there just something fundamentally troubling about the position that you're advocating years ago

[00:05:00] Speaker 01:
you lost a jury verdict.

[00:05:02] Speaker 01:
So citizens came in, did their duty, made a finding, liability damages, case comes up on appeal.

[00:05:09] Speaker 01:
A panel of this court affirms almost all of that.

[00:05:13] Speaker 01:
And the case goes back just on these post trial damages issues and the related enhancement.

[00:05:22] Speaker 01:
And simply because in the meantime, some third party that you all had nothing to do with,

[00:05:26] Speaker 01:
gets an instituted PTAD petition.

[00:05:33] Speaker 01:
Now we are supposed to wipe out and render null and void all those prior efforts of the jury, of Judge Dillstrap, of the prior panel of this court.

[00:05:45] Speaker 01:
Isn't there something troubling about that?

[00:05:47] Speaker 02:
Well, the concern, Your Honor, is awarding damages on claims that are invalid.

[00:05:51] Speaker 02:
It is true that a lot of them.

[00:05:53] Speaker 01:
Well, that is also a concern.

[00:05:54] Speaker 01:
But what about the concerns I've raised?

[00:05:56] Speaker 02:
Yeah, I think whenever a case, the balance that the court has struck in this is I think you're describing the finality and the interest in reaching final conclusions.

[00:06:08] Speaker 02:
But when a patent is determined by the administrative body that

[00:06:14] Speaker 02:
Congress and the Constitution is empowered to decide whether it should even have a patent, finds that patent is invalid.

[00:06:20] Speaker 02:
That should be respected and have effect in all other cases, certainly any case that's pending, to award damages to a plaintiff on invalid claims.

[00:06:30] Speaker 02:
The court claims that this court could affirm, as that appeal is now concluded, could affirm these are invalid claims.

[00:06:40] Speaker 02:
The one thing about patent cases is the facts are not always fully present in every single case.

[00:06:46] Speaker 02:
So the fact that a third party focused on a different prior art, they actually referred to the record that was developed in the packet intelligence case against NetScout in their petition.

[00:06:58] Speaker 02:
So it could have influenced the patent office in some way.

[00:07:03] Speaker 02:
So there may not have been entirely unrelated events, even though NetScout was certainly uninvolved.

[00:07:08] Speaker 02:
But I think the greater injustice would be awarding damages on claims that this court has found to be invalid.

[00:07:16] Speaker 02:
And the goal of due process is to get to the right answer.

[00:07:20] Speaker 02:
Now the fact that a jury came to one conclusion and parts of this case were affirmed doesn't mean that it would be fair or appropriate to award damages to a party on claims that are known to be invalid based on the art that's in front of the court.

[00:07:36] Speaker 00:
Known to be invalid.

[00:07:37] Speaker 00:
And you said a few moments ago, these claims are invalid.

[00:07:41] Speaker 00:
Not necessarily so at this point, right?

[00:07:46] Speaker 02:
They were found to be invalid by the board.

[00:07:48] Speaker 02:
And it's before your honor.

[00:07:49] Speaker 02:
And it'll be up to you to decide, obviously, whether you're going to affirm that ruling or not.

[00:07:56] Speaker 01:
Would you talk about that?

[00:07:57] Speaker 01:
What if we are remanding in the first appeal?

[00:08:02] Speaker 01:
You want us then to just hold this particular appeal, your appeal, in abeyance to see what happens?

[00:08:11] Speaker 01:
How would that be consistent with due process and fairness?

[00:08:16] Speaker 02:
well the the the fairness is that that is the way to ensure a just result if you issue a stay what's not this will protect us to the patentee who's already been waiting for years to collect on the judgment that i remind you has already been affirmed by this court if there is a state that's entered in packet intelligence wins on its remand and its claims are not invalid that it'll get damages that are fully bonded will get them into so it's not going to lose anything

[00:08:43] Speaker 02:
If its claims are invalidated, or that's confirmed in subsequent proceedings, then that's not cognizable prejudice.

[00:08:51] Speaker 02:
It shouldn't have recovered that damages in the first place.

[00:08:55] Speaker 02:
Keep in mind, the packet intelligence has made recoveries on these patents with other parties with cases that aren't pending.

[00:09:02] Speaker 02:
I mean, they had prior cases against Cisco and Huawei.

[00:09:05] Speaker 02:
And those cases aren't before you seeking to overturn those.

[00:09:10] Speaker 02:
But in this case, NetScout is in a current dispute in a pending case on patents that your honors may declare invalid.

[00:09:18] Speaker 02:
And in that circumstance, every case that's looked at this, from Presenius to XY,

[00:09:24] Speaker 02:
different addicts most recently the crime are every case that's considered it if there is an active ongoing dispute they've given a party the benefit of uh... of and and issue preclusion and and i do think it is appropriate court obviously has the power to stay it does that routinely when the outcome of one appeal uh... would resolve uh... another case here the case for companion eyes essentially i think to give the court an opportunity to at least to consider that path

[00:09:54] Speaker 02:
If the Federal Circuit didn't want to have a case stayed on its docket during a remand to an administrative proceeding, NETSCOUT also moved for a stay below.

[00:10:07] Speaker 02:
And it has appealed that.

[00:10:10] Speaker 02:
And so Your Honors could simply just reverse the court's failure to stay below, and it could remand to the district court with directions to stay during the appeal.

[00:10:20] Speaker 02:
And I think that the result would be fair, because packet intelligence

[00:10:23] Speaker 02:
If it wins, it gets its damages.

[00:10:25] Speaker 02:
If it loses, it's not entitled to them.

[00:10:27] Speaker 02:
But if you don't stay, there's a real chance that Netscout ends up paying damages on claims that this court ultimately finds are invalid.

[00:10:35] Speaker 02:
And I think that's certainly the greater injustice in all the potential outcomes.

[00:10:42] Speaker 02:
I have reserved time, Your Honor.

[00:10:43] Speaker 02:
I'm happy to stop now if that makes sense or if you have other questions.

[00:10:48] Speaker 00:
We will save your time.

[00:10:50] Speaker 00:
Thank you, Your Honor.

[00:10:52] Speaker 00:
Mr. Skirmod?

[00:10:57] Speaker 03:
Thank you, Your Honors.

[00:10:58] Speaker 03:
May it please the Court.

[00:11:00] Speaker 03:
There's something very troubling about taking away the adjudicated and final damages from a jury verdict that issued in 2017 and a mandate from this Court issued in October of 2020, now here three years and four months after that mandate issued.

[00:11:22] Speaker 00:
But how is this case different from Fresenius?

[00:11:25] Speaker 03:
Well, unlike Fresenius, here this court did not remand for further proceedings to reconsider an injunction and to reconsider the royalty awards that were issues that were live issues that had to be remanded.

[00:11:42] Speaker 03:
Here the only issues, and what the district court found on remand and what is reality, is that the only issue to be remanded

[00:11:53] Speaker 03:
was to execute this court's mandate that the portion of the enhanced damages that were tied to pre-suit damages, which were taken away for notice and marking issues, there was a reversal of the award of pre-suit damages for that reason.

[00:12:13] Speaker 03:
which is a self-executing reversal.

[00:12:16] Speaker 03:
And then this court said, any enhanced damages related to those pre-suit damages that had been reversed, related thereto is what this court's mandate says.

[00:12:29] Speaker 01:
It's a lot to say it was self-executing.

[00:12:32] Speaker 01:
It doesn't look like it when you look at the district court docket following our remand.

[00:12:36] Speaker 01:
There was a lot of briefing.

[00:12:37] Speaker 03:
there was a significant opinion or two there was a real dispute in which millions of dollars were at stake that doesn't look self-executing well it was uh... you're correct that there was a lot of copious post-remand briefing in this case but the only issue that was not self-executing so to speak was it

[00:13:04] Speaker 03:
tied to the issue of what did related thereto mean.

[00:13:08] Speaker 03:
And in fact, and so on remand, packet intelligence argued that because all of the findings of willfulness

[00:13:17] Speaker 03:
The facts related to willfulness happened post-suit.

[00:13:22] Speaker 03:
The argument was on remand.

[00:13:25] Speaker 03:
There were no damages.

[00:13:27] Speaker 03:
There was nothing tied to the enhancement that related to the pre-suit damages.

[00:13:32] Speaker 03:
The district court rejected that argument on remand.

[00:13:36] Speaker 03:
And this is important.

[00:13:38] Speaker 03:
In that context, NetScout agreed with the district court's move that once it concludes that it does not agree with the point that because the willfulness facts were all post-suit, that all of the willfulness damages can remain, NetScout argued.

[00:13:59] Speaker 03:
and conceded that the way to get rid of the enhanced damages that are related to the reversed presuit award is to proportionally reduce the enhanced damages based on the proportion between the presuit damages that were taken away

[00:14:17] Speaker 03:
and the post-suit damages that remained, which is exactly what the district court did, and that should have been the end of story.

[00:14:24] Speaker 03:
What NetScout then further did, which is what caused a year's worth of post-remand briefing, rule 59, emotions for reconsideration, or rule 59E and the like, were all insubstantial issues.

[00:14:39] Speaker 03:
primarily, all of the post remand litigation was about whether the court needed to reweigh and do a complete redo of its analysis of the read factors on enhanced damages.

[00:14:52] Speaker 01:
Are you contending that the entirety of what happened on remand was insubstantial?

[00:14:59] Speaker 03:
Yes, Your Honor.

[00:15:01] Speaker 03:
In particular, the vast majority of the remand

[00:15:05] Speaker 03:
proceedings, if not all of the remand proceedings, related to this issue of whether the read factors need to be reweighed, which to be clear, they did not need to be reweighed.

[00:15:15] Speaker 03:
And reweighing the read factors, in fact, would have been a violation of the mandate rule here under a motto and retractable technologies precedence of this court.

[00:15:26] Speaker 03:
Because

[00:15:27] Speaker 03:
NetScout did not argue, it was clearly within the scope of the judgment, the enhancement, the enhanced damages.

[00:15:36] Speaker 03:
NetScout did not argue on appeal that the read factors had been misapplied and even more importantly, and this is retractable technologies holding, even more importantly

[00:15:47] Speaker 03:
NetScout in the first appeal did not argue that if there is a reversal of the pre-suit damages, that the read factors then need to be reweighed on remand.

[00:15:58] Speaker 03:
So the idea that a read factor reanalysis was required to happen on remand is foreclosed by the mandate rule.

[00:16:08] Speaker 01:
But wouldn't you agree that

[00:16:11] Speaker 01:
After our remand, there was more for the district court to do other than simply execute the judgment.

[00:16:20] Speaker 03:
Your Honor, there wasn't more for the district court to do other than implement this court's mandate.

[00:16:26] Speaker 01:
Yeah, but that's not our test.

[00:16:27] Speaker 01:
Fresenius says that the case is not sufficiently final to be immune from subsequent developments, such as the PTAB finding that may be upheld on appeal.

[00:16:37] Speaker 01:
We don't know.

[00:16:39] Speaker 01:
unless there is nothing for the court, that is the district court, to do but execute the judgment.

[00:16:46] Speaker 03:
And I believe that the precedent is the only thing, that was all that was left to do here except for other than disposing of insubstantial arguments that Netscout raised on remand.

[00:17:03] Speaker 01:
Other than that, because remember, Netscout agreed... We've allowed for the possibility, I think, that maybe there's an exception to this finality rule if everything on remand is insubstantial.

[00:17:17] Speaker 01:
Maybe you're right about that, but even if so, how could we find this insubstantial?

[00:17:23] Speaker 01:
You made arguments

[00:17:26] Speaker 01:
contrary to the arguments they made and I think, help me if I'm wrong, that they prevailed on a lot of those arguments and there was a direct financial consequence as a result.

[00:17:36] Speaker 03:
Well, the argument, I think that you're reversing or have the issue backwards in the sense that on remand, NetScout won the argument that

[00:17:48] Speaker 03:
There should be a proportional reduction of the enhanced damages award based on the ratio between the pre-suit damages that were reversed and the post-suit damages that were affirmed on appeal.

[00:18:01] Speaker 03:
NetScout won that argument.

[00:18:02] Speaker 03:
Packet Intelligence did not contest it.

[00:18:05] Speaker 03:
Final order can be entered.

[00:18:07] Speaker 03:
The only thing that emerged after this.

[00:18:09] Speaker 01:
Let's just stop there, though.

[00:18:11] Speaker 01:
NetScout made that argument.

[00:18:15] Speaker 01:
it had a financial impact on the amount of the judgment at the end of the day, correct?

[00:18:20] Speaker 03:
It did not, Your Honor, in the sense that the whole issue on remand was, the single issue on remand, everybody agrees there was nothing to dispute about the pre-suit damages are gone, right?

[00:18:30] Speaker 03:
That's what this Court held.

[00:18:32] Speaker 03:
So we go back to remand.

[00:18:33] Speaker 03:
There's no debate about how the pre-suit damages gone.

[00:18:36] Speaker 03:
They are.

[00:18:37] Speaker 03:
Then it is, what does enhance thereto mean?

[00:18:40] Speaker 03:
Met Scout said, enhance thereto means that you do a proportional reduction of the enhanced damages.

[00:18:49] Speaker 03:
Court says, agreed.

[00:18:51] Speaker 03:
And that's the end of the story.

[00:18:53] Speaker 01:
What did packet intelligence say?

[00:18:54] Speaker 03:
Packet intelligence argued that there needed to be no reduction of the willfulness damages, of the enhanced damages, based on an argument about willfulness findings.

[00:19:05] Speaker 03:
The packet intelligence lost.

[00:19:07] Speaker 01:
At that point, the judgment is fine.

[00:19:09] Speaker 01:
Hold on.

[00:19:10] Speaker 03:
Yes, Your Honor.

[00:19:11] Speaker 01:
There is some delta, right?

[00:19:13] Speaker 01:
You were arguing that in part, not just because you thought it was right to keep the enhancement, but there was some amount of money of additional enhanced damages that your client would have had in the amended judgment that it didn't have because NetScout won that argument on this particular issue on remand, correct?

[00:19:37] Speaker 03:
Yes.

[00:19:38] Speaker 01:
So in this situation, you've conceded, as I think you have to, that on remand, in addition to executing the judgment, there was a dispute over the amount of the enhanced damages to put into the amended final judgment.

[00:19:57] Speaker 01:
The parties briefed it.

[00:19:59] Speaker 01:
It had a financial impact on the amount of dollars that were going to end up in the final amended judgment.

[00:20:07] Speaker 01:
And NETSCOUT won that dispute.

[00:20:09] Speaker 01:
Those are the facts.

[00:20:10] Speaker 01:
How can this court say that the only issues left on remand were insubstantial?

[00:20:17] Speaker 03:
The only issues left for appeal of the remand decision were insubstantial.

[00:20:22] Speaker 03:
There was a single dispute about how to implement this court's mandate that the enhanced damages related thereto

[00:20:34] Speaker 03:
need it that that uh... court needed to take away the pre-suit damages ended and any enhanced damages related there too on that argument uh... net scout argued that related there too means do a proportional reduction which the court did a proportional reduction in its amended final judgment that merged into this court's mandate and there was nothing to appeal

[00:21:01] Speaker 03:
Packard Intelligence did an appeal.

[00:21:02] Speaker 03:
The only reason this case is still active and before this court is because NetScout, after the court resolved what enhanced their two means in NetScout's favor, they raised additional collateral arguments that were outside the violated the mandate rule.

[00:21:26] Speaker 03:
and were otherwise insubstantial.

[00:21:28] Speaker 03:
And so in fact, this whole debate and issue about how the court implemented this court's mandate on related thereto essentially establishes or confirms that the amended final judgment should have been the end of story because there was nothing that Netscout argued below about implementing the mandate that was still a live contested issue.

[00:21:56] Speaker 01:
I think I understand what you're saying.

[00:21:57] Speaker 01:
I think you're right to point this out to me.

[00:22:00] Speaker 01:
The question of whether there's a substantial issue left

[00:22:06] Speaker 01:
goes to the instant appeal that you and I are talking about right now.

[00:22:12] Speaker 01:
But it's a somewhat similar issue that I think you have to get over, which is Fresenius says the case is not final following the remand the last time around, unless there's nothing for the district court to do other than execute the judgment.

[00:22:29] Speaker 01:
So all the sort of scenario that I went through with you

[00:22:33] Speaker 01:
that I put in the context of, is there a substantial issue?

[00:22:36] Speaker 01:
I should have put it in the context of, doesn't all of that show that there was something for the district court to do in addition to simply execute the judgment?

[00:22:50] Speaker 03:
There was something for the district court to do to implement the mandate.

[00:22:55] Speaker 03:
And once it implemented the mandate,

[00:22:58] Speaker 03:
there was nothing further to do other than execute on the judge and maybe that and there's nothing to appeal.

[00:23:04] Speaker 01:
Maybe that should be the test, but our test under Fresenius is not, is there anything for the district court to do beyond implement the mandate?

[00:23:12] Speaker 01:
The test is, is there anything for the district court to do other than execute the judgment?

[00:23:16] Speaker 03:
Well, I think under these facts, Your Honor, I think that there is the Fresenius

[00:23:27] Speaker 03:
standard about finality, which I think we're all talking about and agree with, it has to interplay in some way with the mandate rule.

[00:23:34] Speaker 03:
And in this case, specifically, the way that the Fresenius standard interacts with the mandate rule when the appellant in that case, in the prior case, gets what it asks for,

[00:23:51] Speaker 03:
such that the mandate rule is satisfied by what the appellant asked for on remand, then in that context of the Fresenius finality rule, the amended final judgment is final.

[00:24:10] Speaker 03:
And there is nothing else to do but execute.

[00:24:12] Speaker 03:
There is nothing else to resolve once the district court implements this court's mandate.

[00:24:18] Speaker 01:
You suggest that you have a separation of powers argument.

[00:24:22] Speaker 01:
I'm not sure that it was well developed.

[00:24:24] Speaker 01:
What is your separation of powers argument?

[00:24:27] Speaker 03:
I'm not entirely sure what the district court separation of powers issue.

[00:24:35] Speaker 03:
Our issue is mostly that finality has to matter.

[00:24:38] Speaker 03:
For the administration of justice,

[00:24:40] Speaker 03:
to be in a situation where a 2017 jury verdict, and let's remember, the 2017 jury verdict came after six PTAB petitions were filed and were all denied institution.

[00:24:55] Speaker 03:
And this is a second round, what we're talking about with the appeal that just happened before, this case.

[00:25:02] Speaker 03:
That was a whole second round of petitions by other parties that had the benefit of the first PTAB rulings that denied institution, and the mandate of this court issued in October of 2020.

[00:25:15] Speaker 03:
The only reason this case is still alive at the same time, the final written decisions in the subsequent PTAB round,

[00:25:25] Speaker 03:
did not issue until September 2021, which was nearly a year after the mandate of this court issued that found the patents not invalid, and to have an administrative court

[00:25:40] Speaker 03:
It's the tail wagging the dog to have the administrative procedure that has not yet been affirmed by this court, when the prior district court finding of not invalid has been affirmed by this court, would upend all of the notions of fairness and importance of the finality rule and the mandate rule.

[00:26:02] Speaker 03:
And I say that I'm out of time, unless your honors have anything else.

[00:26:05] Speaker 00:
Thank you, counsel.

[00:26:07] Speaker 00:
Mr. Lyons has some rebuttal time.

[00:26:11] Speaker 02:
Thank you, your honor.

[00:26:14] Speaker 02:
Regarding whether it's a self-executing reversal, as your honor was pointing out, there was quite a bit to do on this remand.

[00:26:21] Speaker 02:
I do want to clarify what NetScout's actual position was.

[00:26:24] Speaker 02:
In the remand, it said the enhancement should be zero.

[00:26:28] Speaker 02:
That's the position it advanced.

[00:26:31] Speaker 02:
It argued that to implement what it was required under

[00:26:35] Speaker 02:
the mandate to eliminate from the enhancement any portion associated with the pre-filing damages needed to revisit the read factors and the answer was there was no enhancement.

[00:26:51] Speaker 02:
That was the position that was advanced and that's what's on appeal.

[00:26:55] Speaker 02:
The issue about the proportionality was from NetScout's perspective, the read factors only had gotten stronger for them.

[00:27:05] Speaker 02:
And certainly even if the court was unwilling to reconsider or even look at any of the new developments, a ceiling on damages would be this proportional reduction.

[00:27:17] Speaker 02:
There was no theory under which advanced by any party that it could somehow be higher than that.

[00:27:23] Speaker 02:
At no point did Netscout say that was the appropriate outcome.

[00:27:26] Speaker 02:
And the district court's opinion reflects that.

[00:27:29] Speaker 01:
It says... How are the issues on appeal in front of us right now anything other than insubstantial?

[00:27:34] Speaker 02:
Well, first of all, there are a series of issues before you.

[00:27:38] Speaker 02:
We've been focused on enhancement.

[00:27:41] Speaker 02:
It's a $1.1 million issue about whether there should be enhancement.

[00:27:46] Speaker 02:
And I think, as we've argued in the briefing, there is no question that the district court could have revisited the read factors on remand in this situation.

[00:28:01] Speaker 01:
Because the question of- Of course, there's

[00:28:03] Speaker 01:
at least question, the judge applied the mandate rule and said, and I think this is right, you never separately appealed last time the enhancement for just post-trial damages, did you?

[00:28:18] Speaker 02:
We did not.

[00:28:19] Speaker 02:
And the issue is whether the district court in the first decision had ever considered what the enhancement should be for post-filing damages alone.

[00:28:29] Speaker 02:
And since that issue wasn't decided by the district court, it cannot be

[00:28:33] Speaker 02:
encompassed by the mandate.

[00:28:34] Speaker 02:
The court has to, in implementing the mandate, has to determine that.

[00:28:39] Speaker 02:
There also was a new event that occurred during the remand.

[00:28:45] Speaker 02:
You ask about the substantiality issues.

[00:28:47] Speaker 02:
There's the enhancement issue.

[00:28:48] Speaker 02:
There's also the ongoing royalty, which the district court agreed needed to be changed during the remand.

[00:28:55] Speaker 02:
And that hasn't been even opposed by PAC and intelligence.

[00:29:00] Speaker 01:
Wouldn't that suggest it's not a substantial issue for this court on appeal?

[00:29:04] Speaker 02:
The district court did not adopt a rate that was proposed by NETSCOUT.

[00:29:10] Speaker 02:
That's being appealed.

[00:29:11] Speaker 02:
And it didn't make it effective as the date that NETSCOUT had asked that it be effective.

[00:29:16] Speaker 01:
Well, it's because it asked for it to be prospective only.

[00:29:19] Speaker 02:
Prospective as of the mandate.

[00:29:21] Speaker 01:
The issue in that the- Well, you didn't make that clear to the district court, did you?

[00:29:25] Speaker 02:
And I think we did, Your Honor, because the issue that they raised was whether the change in the ongoing royalty was foreclosed by the mandate.

[00:29:36] Speaker 02:
And we respond to that by saying, well, this is prospective, meaning it's after the mandate in that context.

[00:29:42] Speaker 01:
What if any case law or other authority would you have us look to to determine whether your appeal in front of us right now is substantial or insubstantial?

[00:29:52] Speaker 02:
So we already talked about Fresenius, which in that case the ongoing royalty issue was found to be substantial.

[00:30:03] Speaker 02:
closely analogous, because during the remand, while these issues were being addressed, the $2.8 million that NetScout was arguing it was entitled to, all these remand issues were going on, that's when the PTAB decision in validating the claims came down.

[00:30:19] Speaker 00:
Was crime non-precedential?

[00:30:22] Speaker 02:
Yes, Your Honor.

[00:30:25] Speaker 02:
And when those PTAB decisions came down, the remand was still active.

[00:30:30] Speaker 02:
Those came down

[00:30:31] Speaker 02:
nine months or so before the district court resolved the enhancement questions that were being debated, nine months before the ongoing royalty issue was resolved.

[00:30:44] Speaker 02:
And immediately after those decisions, NETSCOUT sought judgment in its favor, or at least a stay.

[00:30:51] Speaker 02:
And specifically in CRIMAR, this court said that the defendant could reasonably request the stay of the case in light of the board's decisions,

[00:30:59] Speaker 02:
We conclude that at least under present case law, there is nothing insubstantial about the defendant's argument for a stay of the case.

[00:31:08] Speaker 02:
So you've got not only the enhancement dispute, the ongoing royalty dispute, you've got a PTAB decision, motion to stay.

[00:31:15] Speaker 02:
So you have all of these issues.

[00:31:17] Speaker 02:
And you're pointing to the magnitude of the size of the record on remand, which is very substantial.

[00:31:24] Speaker 02:
It's because of all these very substantive issues that were before the court and were being

[00:31:29] Speaker 02:
decided.

[00:31:31] Speaker 02:
And I think there's also been a lot of suggestion that the enhancement argument or the mandate somehow required this mechanical analysis.

[00:31:40] Speaker 02:
I would also say the PTAB decision was an intervening event.

[00:31:44] Speaker 02:
that occurred after the first appeal.

[00:31:47] Speaker 02:
Obviously the mandate couldn't have foreclosed the district court from considering an event that occurred after the mandate.

[00:31:54] Speaker 02:
And so in that circumstance, we would argue that there were very substantial issues.

[00:31:59] Speaker 02:
And it looks like my time is up, Your Honor.

[00:32:02] Speaker 00:
Thank you.

[00:32:03] Speaker 00:
To both counsel, the case is submitted.

[00:32:05] Speaker 02:
Thank you, Your Honor.