[00:00:03] Speaker 02: Thank you Judge Raina and may it please the court. [00:00:19] Speaker 01: In the trial below and in the post-judgment motions below, the plaintiff Sincor relied exclusively on a willful blindness theory. [00:00:28] Speaker 01: That theory is insufficient as a matter of law for at least two reasons. [00:00:32] Speaker 01: One, there is not substantial evidence of deliberate action taken specifically to avoid confirming knowledge of infringement. [00:00:41] Speaker 01: Secondly, willful blindness is insufficient as a matter of law to establish the specific and deliberate intent required for willfulness. [00:00:49] Speaker 01: For both of those reasons and others in our brief, we're asking for reversal. [00:00:53] Speaker 01: One thing that I think is important here is the timeline. [00:00:57] Speaker 01: The only patent left in this case on appeal. [00:00:59] Speaker 01: the 702 patent was not issued until 2009. [00:01:04] Speaker 01: So well into this other trial of these other defendants. [00:01:07] Speaker 01: There's no evidence in the record we were aware of that patent, we being Vicor, until mid-2010 when those other defendants bring us into the case as the non-infringing alternative. [00:01:20] Speaker 01: At that point, the plaintiff in this case, Sincor, does not send us a letter saying, no, we actually think you infringe, does not accuse us of infringement. [00:01:29] Speaker 01: It's not until December of 2010 in the trial that we're not in. [00:01:33] Speaker 01: When did Cisco approach your client? [00:01:36] Speaker 01: I think the record evidence, Your Honor, shows September of 2010 with respect to the issues relevant here. [00:01:43] Speaker 01: I think there was probably a relationship on other issues before that. [00:01:46] Speaker 04: And Vicar was no doubt familiar with this [00:01:50] Speaker 04: 497 litigation before December 2010 too, right? [00:01:54] Speaker 01: Oh, I think that's fair Judge Chen, but of course we're brought into that litigation as the non-infringing alternative and the plaintiff doesn't even take the opportunity at that point to accuse us. [00:02:02] Speaker 04: Francisco wanted some assurances that if you were going to provide them with these products, with these power converters, that they wouldn't infringe. [00:02:14] Speaker 04: Isn't that right? [00:02:16] Speaker 04: Instead of [00:02:17] Speaker 04: giving them that kind of assurance through an opinion letter, Vykor said, well, we'll just indemnify you. [00:02:25] Speaker 01: Oh, gosh, Judge Chen, that's not at all only what happened. [00:02:29] Speaker 01: Let me correct two things, and I don't think this can reasonably be disputed even on substantial evidence review. [00:02:33] Speaker 01: First, the request that you're referring to is at page 76858 of the record. [00:02:39] Speaker 01: And what Cisco said is, it might be good if you issued some statement that you don't infringe. [00:02:44] Speaker 01: But actually, what would be more helpful to keep it nonpublic is just a conversation between the lawyers. [00:02:49] Speaker 01: There's no evidence that conversation didn't happen. [00:02:51] Speaker 01: But more importantly, it's not just the indemnification, which, by the way, I think shows that we thought we didn't infringe because we're taking on a financial burden to pay if we infringe. [00:03:00] Speaker 01: Two different ways you can read that. [00:03:02] Speaker 01: I think it goes far more strongly. [00:03:04] Speaker 01: But the most important thing is that we immediately redesign our products to avoid the claim construction in the 497 case. [00:03:11] Speaker 01: The construction was that short transitions requires under 20%. [00:03:16] Speaker 01: We immediately redesign our products and assure these customers that, of course, we want to pick up as part of market share, that we don't think we infringe anyway. [00:03:25] Speaker 01: But we've now lengthened this to avoid literal infringement. [00:03:28] Speaker 01: Judge Freeman, I'm sorry. [00:03:28] Speaker 01: I cut you off. [00:03:29] Speaker 00: Mr. Bash, you. [00:03:30] Speaker 00: You had a jury verdict where your company's non-infringement position was not accepted by the jury, and you were aware of that. [00:03:39] Speaker 00: And you also, it seems throughout your brief, you're asking us, rather than to consider substantial evidence, to actually draw all inferences in favor of Vicor's position on this willful blindness issue. [00:03:53] Speaker 00: The way I read the record is that the jury was presented with ample evidence of your client's conduct in watching its competitors. [00:04:03] Speaker 00: Not that that's unlawful conduct, but they understood and could reasonably consider the manner in which your client studied the conduct of its competitors and how it positioned itself to gain market share, and that the timing of Vicor's [00:04:22] Speaker 00: assistance to these clients who had lost the products that were unlawful under the 497 was an opportunity that the jury didn't find was an honest opportunity, but rather was bringing in another infringing product. [00:04:40] Speaker 00: Plus, the record shows that, yes, you redesigned for the 25%, but you didn't take off the market or recall the product that still had the timing of under 20%. [00:04:50] Speaker 01: Judge Freeman, there's a lot there. [00:04:52] Speaker 01: Let me make three points in response. [00:04:53] Speaker 01: I want to make sure I have them all in my head. [00:04:55] Speaker 01: First, just a factual response. [00:04:56] Speaker 01: We were not necessarily found to infringe in the 497 case. [00:05:01] Speaker 01: We were either an infringing alternative or not an alternative, not a possible alternative. [00:05:07] Speaker 01: Remember, our products didn't fit those customers at the time. [00:05:10] Speaker 01: We had to change them. [00:05:10] Speaker 01: So no, we were not aware. [00:05:12] Speaker 01: And by the way, the jury was told they couldn't use that verdict as evidence of infringement here. [00:05:18] Speaker 01: And that's undisputed on appeal. [00:05:19] Speaker 01: So that's one. [00:05:20] Speaker 01: Two, I'm taking your last point next, with respect to these products that were above the 20% transition and so the argument was over literal infringement. [00:05:30] Speaker 01: Remember, and I'm happy to talk about why they've waived an actual knowledge requirement four ways to Sunday theory, but [00:05:37] Speaker 01: At that point, December 2010, there's this verdict. [00:05:41] Speaker 01: We file a declaratory judgment action. [00:05:43] Speaker 01: We have lawyers look at it. [00:05:44] Speaker 01: We say, Judge, we want you to say we don't infringe. [00:05:47] Speaker 01: Whatever you think about our mens rea at that point forward, that cannot possibly be willful blindness, even with respect to these literal products. [00:05:54] Speaker 01: We've looked at the claims. [00:05:55] Speaker 01: We've had a lawyer look at them. [00:05:56] Speaker 01: We filed a declaratory judgment action. [00:05:59] Speaker 01: That's the only theory they pursued below. [00:06:01] Speaker 02: And the reason that's... What about the activity after Cisco sawed identification? [00:06:07] Speaker 01: The activity after Cisco, this is all a very short period. [00:06:10] Speaker 01: So our discussions with Cisco start in September 2010. [00:06:13] Speaker 01: The infringement verdict on the other case is December 2010. [00:06:18] Speaker 01: By January 2011, we filed a declaratory judgment action and we've rolled out products that everybody agrees do not literally infringe the patent. [00:06:26] Speaker 01: So that's all a very short period of time. [00:06:31] Speaker 01: Whatever you think, I mean, even if you thought, well, maybe you could get actual knowledge on the literally infringing devices afterwards, they waived that theory. [00:06:37] Speaker 01: The only thing they argued was willful blindness. [00:06:40] Speaker 01: It can't possibly be that once we're filing a declaratory judgment action saying we don't infringe, that's willful blindness. [00:06:46] Speaker 01: I mean, we've looked at the patent. [00:06:47] Speaker 01: We have lawyers look at the patent. [00:06:47] Speaker 01: We're filing an action in court. [00:06:49] Speaker 01: That's the only theory they preserved below. [00:06:51] Speaker 01: Judge Raina, on the indemnification. [00:06:53] Speaker 04: Is there a case law that says, [00:06:55] Speaker 04: Once a DJ action is filed, there can never be any willful blindness theory of liability thereafter? [00:07:02] Speaker 01: I'm not aware of a case either way, Judge Chen, but I think it follows ineluctably from global tech and the standard. [00:07:09] Speaker 01: I mean, the standard for willful blindness is you are avoiding confirming infringement by taking deliberate action. [00:07:15] Speaker 04: Then the next question I have is the... [00:07:17] Speaker 04: Clearly, the jury found you liable for induced infringement and also willful infringement. [00:07:28] Speaker 04: But the damages amount is very small that it awarded compared to what it could have awarded, what the plaintiff requested. [00:07:36] Speaker 04: So we can't really tell which products the jury might have been focused on. [00:07:42] Speaker 04: It could have been focused on the pre-complaint filed products. [00:07:47] Speaker 04: It could have been focused on the non-modified power converters. [00:07:53] Speaker 04: It's hard to know, because we have [00:07:55] Speaker 04: black box jury verdict here. [00:07:57] Speaker 04: But the point is that even if we were to agree with some of these arguments about this piece, that piece, maybe not being a perfect fit for some of these different infringement theories, nevertheless, the damages amount that was awarded is so small that one could see a way to work around your more piecemeal arguments. [00:08:18] Speaker 01: Well, I hope you don't think that, Judge Shanks. [00:08:19] Speaker 01: I don't think that's right. [00:08:20] Speaker 01: On the central argument on liability, the argument on indirect infringement, [00:08:25] Speaker 01: There is simply no deliberate action taken to avoid confirming infringement, even if you disagree with us that we thought there was a risk based on us looking at data sheets a decade before. [00:08:35] Speaker 01: I don't think that gets there. [00:08:36] Speaker 01: Even if you disagree with all that, there is simply nothing that could be more than just picked up on that. [00:08:42] Speaker 04: What, in your view, would be deliberate action above and beyond what happened here? [00:08:47] Speaker 01: Well, for example, if you told your engineers, do not look at any other patents while you design this. [00:08:53] Speaker 01: For example, if SYNCOR had done what most people in their situation would do, which was send us a letter saying you infringe, and the CEO said, I know that's letters coming from SYNCOR. [00:09:01] Speaker 01: Rip it up. [00:09:02] Speaker 01: I don't want to look at it. [00:09:03] Speaker 04: What about the testimony from ViCOR's CEO that said, we don't look at SYNCOR's patents? [00:09:09] Speaker 04: That doesn't matter to us. [00:09:10] Speaker 01: Gosh, Judge Shen, that testimony, I know that was their exhibit one in their closing argument on mens rea. [00:09:17] Speaker 01: It cuts exactly the other way. [00:09:18] Speaker 01: First of all, he didn't say, and I can give you the testimony's site and the record, it's app 85729-31. [00:09:26] Speaker 01: He didn't say anything about a policy. [00:09:29] Speaker 01: He just said, I didn't look at the SYNCOR patents until litigation got rolling. [00:09:33] Speaker 00: But aren't you again drawing the inferences in favor of ViCOR? [00:09:37] Speaker 01: I don't think so, Judge Freeman, and the reason I'm not is it's not only deliberate action, which I don't think just not looking at something, that's deliberate indifference, that's not deliberate action, but it's deliberate action to avoid confirming a suspicion. [00:09:49] Speaker 01: Their only evidence was that he didn't look because he didn't think there was any way they infringed. [00:09:53] Speaker 01: Now, I'm not saying that the jury was required to believe his explanation. [00:09:57] Speaker 01: But if the jury disbelieved his explanation, that just gets them to zero. [00:10:01] Speaker 01: They have the burden. [00:10:02] Speaker 01: They didn't come forward with any evidence that we took any deliberate action for the purpose of not confirming a high risk. [00:10:10] Speaker 04: I'm not sure the case law lines up with this conception of deliberate action. [00:10:15] Speaker 04: It seems to me that the fact patterns of the case law seem to suggest [00:10:20] Speaker 04: while as a general matter, not investigating patents is not enough. [00:10:28] Speaker 04: If there's a pattern of conduct where a defendant is actively studying competitors' products and [00:10:37] Speaker 04: and such, it can get to a point where once they know about these patents existence and then choosing not to look at those patents and compare them against their own products, that can rise to a level of being a deliberate leash, shielding your eyes to the obvious. [00:10:56] Speaker 01: Judge Chen, the lodestar under global tech is that deliberate indifference is not enough. [00:11:01] Speaker 04: But the fact pattern there was enough for indirect liability. [00:11:06] Speaker 01: Well it was because they fed false allegations, false understanding to their lawyer to gin up a false opinion and they purposely said we're not going to look at any US products, we're going to go reverse engineer foreign products so we don't see the patent markings. [00:11:19] Speaker 01: is quite different. [00:11:20] Speaker 01: I guess I'll end my answer here. [00:11:22] Speaker 01: Sorry, that's yellow for my opening 11 minutes. [00:11:25] Speaker 01: I'm sorry. [00:11:27] Speaker 01: Here, there's nothing like that. [00:11:28] Speaker 01: And I want to emphasize what I was saying to Judge Freeman, which is that even if you considered his not looking at the patents to be a form of deliberate action, it has to be deliberate action for the purpose of not confirming infringement. [00:11:41] Speaker 01: And it's fine to say you don't have to believe his explanation, but they had to provide some evidence that we had a policy [00:11:48] Speaker 01: of doing that. [00:11:48] Speaker 01: Some other engineer says, no, I think our policy was to avoid confirming infringement. [00:11:52] Speaker 01: There's nothing like that here. [00:11:53] Speaker 01: They can't simply rely on his explanation, which is clearly not sufficient for willful blindness, and say, well, they didn't have to believe that. [00:12:00] Speaker 01: Fine. [00:12:01] Speaker 01: But they still have the burden to come forward with something. [00:12:03] Speaker 01: They have nothing. [00:12:04] Speaker 01: And the other thing I would just say is there's clear evidence in the record that as we were developing our technology, we did extensive patent searches. [00:12:10] Speaker 01: That's at pages 8, 5, 7, 5, 0 to 5, 1 of the record. [00:12:14] Speaker 01: And of course, as is undisputed in this case, as soon as they said we infringed, never telling us that directly, just having their experts say it in a trial, we immediately redesigned our products to avoid literal infringement and brought a declaratory judgment action to clear our name. [00:12:29] Speaker 01: That is simply completely inconsistent with willful blindness. [00:12:33] Speaker 01: The other thing I would say is, [00:12:35] Speaker 01: even if we lose this point I don't think we should lose this point but even if we do this is nowhere close to the sort of deliberate and intentional action required for willfulness which is a specific intent willful blindness only gets you knowledge it does not get you specific intent and then on top of that under halo to get enhanced damages you need conduct in the sense like a pirate I mean that's that's what the chief justice said in halo conduct that's equivalent to roaming the IP high seas and like picking off other ships I mean there's nothing like that here as soon as we were told [00:13:05] Speaker 01: They thought we infringed, we immediately took action to avoid infringement. [00:13:08] Speaker 01: And no one even argues in this case that our DOE argument... Let me just warn you, you're into your rebuttal time. [00:13:13] Speaker 01: Okay, well let me sit down then and I'm happy to take questions on rebuttal. [00:13:16] Speaker 02: We'll restore a few minutes here. [00:13:18] Speaker 02: Thank you. [00:13:26] Speaker 03: Thank you, Your Honor, and may it please the Court. [00:13:28] Speaker 03: This appeal focuses on whether there was legally sufficient evidence [00:13:31] Speaker 03: for a jury defined in Sincor's favor on quintessential fact questions of knowledge and intent. [00:13:37] Speaker 03: There was ample evidence before the jury for them to reasonably conclude that when Vicor seized the opportunity to offer drop-in replacements for the converters removed from the market through the injunction in the 497 case, that it knew that it was going to cause infringement and that it, in fact, intended to do so. [00:13:54] Speaker 03: So a couple of points I want to make sure to touch on. [00:13:55] Speaker 04: Timing is a little tight, though. [00:13:57] Speaker 04: I mean, the injunction happened when? [00:13:59] Speaker 04: In 2011? [00:14:01] Speaker 04: And the DJ action was in 2011? [00:14:05] Speaker 04: Yes. [00:14:06] Speaker 04: So, I mean, when you say that they were trying to seize on some opportunity to, you know, take over the sales of now enjoined competitors, it's an incredibly tight window of time there. [00:14:22] Speaker 04: Right. [00:14:23] Speaker 03: So, a couple of things, Your Honor. [00:14:25] Speaker 03: As I think one of your own questions indicated, there is no rule. [00:14:28] Speaker 03: They don't cite one that says filing a DJ action somehow absolves you of the mental state necessary for inducement. [00:14:35] Speaker 03: That would suggest that anyone who defends against a claim of induced infringement, by virtue of having defended against it, thereby is absolved from the possibility of inducement. [00:14:43] Speaker 03: It remains a fact question whether they had that requisite mental state. [00:14:48] Speaker 03: I want to talk about the after period, but let's go to the before period. [00:14:51] Speaker 03: And that Cisco moment is particularly powerful. [00:14:54] Speaker 03: So Cisco comes to them in September of 2010. [00:14:56] Speaker 03: And they say, and this is what the document says, they are very anxious. [00:15:00] Speaker 03: Those are the words. [00:15:01] Speaker 02: Very anxious to understand the non-Cisco suspected or they had an inkling that the products that they were outselling were infringing products. [00:15:11] Speaker 03: That's right. [00:15:11] Speaker 03: And they were concerned that Vicorce might be too. [00:15:13] Speaker 03: And they wanted to understand that position. [00:15:17] Speaker 03: has already mentioned the indemnity versus legal opinion, which wasn't provided. [00:15:21] Speaker 03: But also... Who sought the indemnification in that situation? [00:15:25] Speaker 03: The Bicor or Cisco? [00:15:27] Speaker 03: Vicor provided the indemnification. [00:15:29] Speaker 03: So Cisco has this great opportunity. [00:15:32] Speaker 03: An important point here is that Cisco is huge, right? [00:15:33] Speaker 03: They're a great customer to have, and Vicor at that moment in 2010 is on their do-not-design list. [00:15:39] Speaker 02: Cisco will not work. [00:15:40] Speaker 02: Let me just finish with my thought about the indemnification. [00:15:44] Speaker 02: So was this presented to the jury as evidence of deliberative action by Vicor? [00:15:52] Speaker 03: A couple of points. [00:15:53] Speaker 03: It was before the jury. [00:15:54] Speaker 03: The testimony is at 85737 of the joint appendix. [00:15:58] Speaker 03: The question for purposes of judgment as a matter of law is whether there is legally sufficient evidence before the jury for it to reasonably reach a particular conclusion. [00:16:07] Speaker 03: So was it cited in the closing argument? [00:16:09] Speaker 03: I don't specifically think so. [00:16:10] Speaker 03: That's also not relevant. [00:16:11] Speaker 00: So what is the evidence of deliberate acts, though? [00:16:15] Speaker 03: OK. [00:16:15] Speaker 03: I do want to touch on knowledge, but with respect to deliberate acts, I'd cite two main things. [00:16:20] Speaker 03: The first is the affirmative decision not to read the patent when you have that subjective high probability, subjective belief of a high probability of infringement. [00:16:29] Speaker 03: Again, we talk about September 2010. [00:16:31] Speaker 03: Cisco is telling them they're very anxious to understand the non-infringent position. [00:16:35] Speaker 03: If counsel on the other side is to be believed, they don't read the patent at that point. [00:16:38] Speaker 03: They wait until December to read the patent because that's when the trial in the 497 case happens. [00:16:44] Speaker 03: They say they weren't brought in until December or didn't know about it. [00:16:47] Speaker 03: The CEO was deposed before trial in the 497 case, pursuant to a subpoena. [00:16:53] Speaker 03: Their position is, well, they didn't read the patent until December. [00:16:56] Speaker 03: Why aren't they reading the patent? [00:16:57] Speaker 03: A reasonable jury could conclude from these facts that they knew about the anxiety about infringement, and they intentionally didn't read it. [00:17:06] Speaker 03: And Judge Chen, you mentioned that the court's cases seem to take a different view from the other sides. [00:17:13] Speaker 03: That's right. [00:17:13] Speaker 03: So global traffic technologies and InfoHOLD, both of those cases, the only deliberate action [00:17:19] Speaker 03: is the decision not to read the patent. [00:17:21] Speaker 03: There's some context. [00:17:22] Speaker 03: They want to distinguish the case based on reasons why they might not have read it. [00:17:25] Speaker 03: But the only action is the action of not reading the patent. [00:17:29] Speaker 03: So that's one. [00:17:30] Speaker 03: Two, I think the Cisco experience, again, is particularly probative. [00:17:34] Speaker 03: Cisco says, what would be most helpful is a legal opinion. [00:17:39] Speaker 03: Vicor's CEO testifies, being asked on cross-examination, did you provide that legal opinion? [00:17:44] Speaker 03: No, I did not. [00:17:46] Speaker 03: Did you provide indemnity and said? [00:17:48] Speaker 03: Yes, I did. [00:17:50] Speaker 03: They made the choice to prefer indemnity over the legal opinion. [00:17:53] Speaker 03: Now, they talk about the redesign. [00:17:54] Speaker 03: And Judge Chen, your question about the damages number is very apt on this point. [00:18:00] Speaker 03: But they still continued, even after this experience with Cisco, they still continued to sell those converters with transition times of under 20%. [00:18:08] Speaker 03: And that's where the judge below said they had an exceptionally weak case on the merits. [00:18:14] Speaker 03: Really no technical defense at all to infringement with respect to those products. [00:18:18] Speaker 03: But they kept selling them through 2012. [00:18:19] Speaker 04: What was the amount of those, though? [00:18:23] Speaker 04: We're hearing from the other side. [00:18:25] Speaker 03: Yeah, so I'm going to help you with this, but it's in the weeds, okay? [00:18:30] Speaker 03: So the answer is, they say it's insubstantial or de minimis. [00:18:34] Speaker 03: They don't say what number they have in mind and they don't exactly say how they get there. [00:18:37] Speaker 03: But based on what they're citing and gesturing at, I think [00:18:40] Speaker 03: that they are assuming the jury resolved a key factual question in their favor and against us. [00:18:45] Speaker 03: So there were a few converters. [00:18:47] Speaker 03: And this is at appendix page, I think, 14 to 15, where the judge addresses these converters, the VIZs 2, 2C, and 1-4, where there was a dispute as to whether they were in the 20% or less bucket or the greater than 20% bucket. [00:19:02] Speaker 03: And the judge found, and remember, the trial went both ways. [00:19:04] Speaker 03: There were two patents. [00:19:06] Speaker 03: So the judge found the jury could reach either conclusion. [00:19:09] Speaker 03: OK, now on this appeal, where it's just the 702 patent issue, we assume all inferences are made in favor of the verdict. [00:19:17] Speaker 03: So we have to assume the jury agreed with us that those products had the under 20% number. [00:19:23] Speaker 03: If you count those products, it's something like about 200,000 [00:19:28] Speaker 03: between the issuance of the patent in 2009 and discontinuance in 2012. [00:19:32] Speaker 03: That's when they stopped selling them. [00:19:34] Speaker 03: If you exclude them, it's very small. [00:19:36] Speaker 03: If you focus only on the 2010 and after period, it's closer to about $100,000, which, by the way, when our royalty ask is $60 a unit, that's starting to look very similar to the damages award. [00:19:48] Speaker 03: We don't know what the jury did, but it's quite possible that they were focused on just those units. [00:19:53] Speaker 03: How I'm getting these numbers, just to be clear, PTX 2255, it's a native exhibit. [00:19:58] Speaker 03: It went back with the jury on a flash drive. [00:20:00] Speaker 03: They actually asked about it while they were deliberating. [00:20:05] Speaker 03: What the other side cites is the closest thing that you can help in terms of looking at papers here, 76964 of the joint appendix. [00:20:13] Speaker 03: But I admit, even with my new glasses, it's very hard to read those numbers, so you'll probably need to zoom in. [00:20:20] Speaker 04: I've withdrawn my question. [00:20:23] Speaker 03: The point is that there is a very significant amount of sales of these products that were undisputedly infringing. [00:20:28] Speaker 03: And it's unapologetic. [00:20:30] Speaker 03: So when Dr. Vincerelli, their CEO, was asked about this, [00:20:35] Speaker 03: You redesign your products. [00:20:37] Speaker 03: You're selling products with faster transitions, or longer transitions, excuse me. [00:20:41] Speaker 03: But you still continue to sell the other ones. [00:20:43] Speaker 03: And you didn't change those, right? [00:20:44] Speaker 03: He agreed. [00:20:45] Speaker 03: That's what he said. [00:20:46] Speaker 03: So the evidence before the jury is that he kept selling those products, notwithstanding the fact that at this point, there is no technical defense to infringement. [00:20:55] Speaker 03: I want to turn to knowledge for a moment. [00:20:58] Speaker 03: Because I think in some ways, the case for knowledge is even easier. [00:21:01] Speaker 03: The only argument they really have with respect to knowledge [00:21:04] Speaker 03: is that we have somehow waived the ability to defend the judgment on a ground actually articulated by the district court based on jury instructions that are undisputed and before the jury. [00:21:15] Speaker 03: The jury was permitted to conclude that there was inducement based on either knowledge of infringement or willful blindness. [00:21:23] Speaker 03: Our argument was primarily focused on willful blindness. [00:21:26] Speaker 03: I'll grant you that. [00:21:27] Speaker 03: But it's not about the closing argument. [00:21:29] Speaker 03: It's about the sufficiency of the evidence. [00:21:31] Speaker 04: So the jury instruction includes both actual knowledge and a willful blindness. [00:21:37] Speaker 04: It absolutely does. [00:21:38] Speaker 04: But the district court's decision, Jamal's decision, denying Jamal, I didn't see him making any reference to actual knowledge as an alternate basis for supporting 271B liability. [00:21:55] Speaker 03: He absolutely does, and it's quite important. [00:21:57] Speaker 03: So I'd like to invite you to take a look at page 31 of the joint appendix. [00:22:04] Speaker 02: What page? [00:22:04] Speaker 02: 31? [00:22:05] Speaker 03: 31. [00:22:05] Speaker 03: This is in the blue brief in the addendum as well. [00:22:10] Speaker 03: So at the beginning of the first full paragraph, a reasonable jury could reach the findings that it reached on scienter and willfulness. [00:22:17] Speaker 03: The key line is, for example, a reasonable jury could have found, based on the totality of the circumstances, then he goes through some of the circumstances, that Vicor knew it was indirectly infringing the 702 patent or [00:22:32] Speaker 03: that it had a subjective high belief, et cetera, that is to say, willful blindness. [00:22:36] Speaker 03: The district judge's own resolution of the JMAW is either knowledge or willful blindness, which makes sense. [00:22:43] Speaker 03: That was the instruction before the jury. [00:22:45] Speaker 03: That is the question for the legal sufficiency of the evidence. [00:22:48] Speaker 03: And both parties addressed knowledge in the briefs, notwithstanding the fact that our heading. [00:22:52] Speaker 04: That's the first and last time the judge references that Bicor knew. [00:23:00] Speaker 03: Well, with respect to the next paragraph, it says that it's willful. [00:23:04] Speaker 03: And willful is only intentional and deliberate on their theory. [00:23:07] Speaker 03: At the end, it says there's sienter and willfulness. [00:23:11] Speaker 04: But that really is the willful infringement analysis that follows seems to be premised a little bit on the willful blindness theory, the way it describes the Arctic cat opinion. [00:23:31] Speaker 03: I think that's, so for Arctic Cat, I don't believe it's a willful blindness case. [00:23:34] Speaker 04: It's not, but the way the judge describes the facts of Arctic Cat seem consistent with a willful blindness type of theory. [00:23:45] Speaker 04: It could be. [00:23:48] Speaker 04: I don't know. [00:23:48] Speaker 04: One way of reading this opinion is he was supporting the 271B liability theory under willful blindness. [00:23:57] Speaker 04: That seems to be the bulk of the discussion. [00:23:59] Speaker 04: And then for willful infringement, there's a continuation of that willful blindness notion to support a willful infringement. [00:24:09] Speaker 03: Here's what I'd say. [00:24:10] Speaker 03: I want to talk about whether it's even possible to have the kind of waiver they're talking about, because there's no case that holds such a thing. [00:24:17] Speaker 03: But when you're saying that his analysis focuses on willful blindness, he's recounting in the prior pages each side's arguments, which do focus on willful blindness. [00:24:24] Speaker 03: I want to get into the briefs and show how we talked about knowledge there, too. [00:24:28] Speaker 03: His analysis, you say, is this the beginning and the end? [00:24:31] Speaker 03: His analysis is page 31. [00:24:35] Speaker 03: He talks about synchorous position. [00:24:36] Speaker 03: He talks about vicorous position. [00:24:38] Speaker 03: His analysis is both parties presented substantial evidence on indirect infringement. [00:24:45] Speaker 03: A reasonable jury could have considered this to find that there was the requisite intent. [00:24:50] Speaker 03: When it says requisite intent, requisite is required under the law as instructed to the jury, which allowed for either inference to be made. [00:24:58] Speaker 03: And then when he says what he means by that, he identifies either inference. [00:25:03] Speaker 03: So we are defending the judgment on a ground actually articulated by the district court. [00:25:07] Speaker 03: They want to reverse the district court's judgment on the ground that we waived something where the district court said it. [00:25:13] Speaker 03: On top of that, it makes sense that the district court said it, because the instructions permit it, and because the briefing talked about knowledge and willful blindness both. [00:25:23] Speaker 03: So for example, I'd invite you, again, in the sections focused on willful blindness, 51-409, we talk about [00:25:32] Speaker 03: sufficient evidence of knowledge, as well as, I think it's 51 for 10 to 11. [00:25:39] Speaker 03: And then 51 for 12, we talk about how Vicor says there's insufficient evidence for knowledge, and we rebut that contention. [00:25:46] Speaker 03: So over three pages, three times, we talk about knowledge. [00:25:49] Speaker 03: So it makes sense that the district court picked up on it. [00:25:52] Speaker 03: It also makes sense, frankly, that we talked about only one of these theories in front of the jury primarily, because there is some tension. [00:26:00] Speaker 03: You either know something, or you don't quite know it, but you pretty much know it and are not trying to confirm it. [00:26:06] Speaker 03: You'd choose one lane or the other. [00:26:08] Speaker 03: But the Hereta case that they cite for this idea of inconsistency is a case about how it's proper to give the jury [00:26:14] Speaker 03: both instructions. [00:26:15] Speaker 03: It's a criminal case. [00:26:16] Speaker 03: If the government says knowledge, but the jury could infer either knowledge or a wolf of blindness, you give the jury both instructions because the jury might actually reject one and accept the other, which we can presume the jury did here. [00:26:29] Speaker 03: I just want to say on this last point, they haven't cited a single case in which an appellee and verdict winner, Anjay Maul, is defending a judgment following a jury trial. [00:26:41] Speaker 03: and is somehow disabled from identifying evidence or arguments that would support that theory. [00:26:47] Speaker 03: There's no rule of waiver that says the fact that our closing argument focused on one version rather than another somehow disables us. [00:26:54] Speaker 04: Can you give me the jury instruction site again? [00:26:57] Speaker 03: Yeah. [00:26:58] Speaker 03: 86256 is inducement. [00:27:06] Speaker 03: Willfulness is 86260. [00:27:09] Speaker 03: That's just intentional and deliberate. [00:27:11] Speaker 03: There was no instruction that permitted a jury to find willfulness based on willful blindness alone. [00:27:16] Speaker 00: I'd like to move to the last minute of your time to talk about exceptional case. [00:27:22] Speaker 00: Sure. [00:27:22] Speaker 00: You didn't win very much of this case. [00:27:25] Speaker 00: In fact, I'm not talking about the damages amount. [00:27:28] Speaker 00: I'm talking about where you started out with 100 claims across four patents. [00:27:32] Speaker 00: You ended up with a couple of claims in one patent. [00:27:37] Speaker 00: I'm struggling with the evidence on what makes this stand out from the rest. [00:27:42] Speaker 00: Because I preside over a lot of cases that start out big and whimper away small. [00:27:47] Speaker 03: Great, so let me start with this. [00:27:49] Speaker 03: As this court recognized in NSC Johnson, it has literally uniformly upheld exceptional case determinations when there's a finding of willfulness. [00:27:58] Speaker 03: This would be the first time that I'm aware of. [00:28:00] Speaker 03: Since octane fitness, the rule is the same. [00:28:02] Speaker 03: They mentioned striker in the reply brief as an exception. [00:28:05] Speaker 03: It's not an exception. [00:28:06] Speaker 03: What happened is that the Supreme Court had decided octane fitness, changing the standard. [00:28:11] Speaker 03: This court remanded to the district court. [00:28:12] Speaker 00: I'm not questioning enhanced damages. [00:28:14] Speaker 03: This is exceptional case. [00:28:15] Speaker 00: Exceptional case. [00:28:16] Speaker 03: That's what I'm talking about. [00:28:18] Speaker 03: So when there's willful infringement, that is a ground for exceptional case, as C. Johnson says, uniformly upheld. [00:28:24] Speaker 03: I didn't see the district court rely on that, though. [00:28:26] Speaker 03: I don't think it specifically calls out willful infringement as such, but it talks about the same evidence, which is that it's especially egregious infringement conduct. [00:28:35] Speaker 03: That's at 78 in the exceptional case discussion. [00:28:39] Speaker 03: And then on top of that, and I'm at the end, so I'll just finish this. [00:28:42] Speaker 03: One point. [00:28:43] Speaker 03: The district court, which was best positioned to see this, saw that they had an especially weak equitable defense that they multiplied the proceedings with. [00:28:51] Speaker 03: They re-argued claim construction over and over and over. [00:28:54] Speaker 03: And they also had legally baseless state law claims that pervaded the proceedings. [00:28:59] Speaker 00: And I didn't see in the summary judgment order that the court called out that the claims were legally baseless. [00:29:05] Speaker 00: In fact, it's a pretty straightforward standard summary judgment order saying they're disputed facts. [00:29:11] Speaker 00: The judge could have criticized the weakness of those claims in the summary judgment order and did not. [00:29:19] Speaker 03: May I respond, Your Honor? [00:29:21] Speaker 03: Yes. [00:29:21] Speaker 03: OK. [00:29:21] Speaker 03: So with respect to, for example, equitable estoppel, they said that they would have evidence of reliance. [00:29:28] Speaker 03: The judge said, OK, it's a fact question. [00:29:30] Speaker 03: But then when it comes time for trial, their CEO said, never have I ever relied on anything Sinclair has ever done. [00:29:37] Speaker 03: So it was reasonable at summary judgment to believe what they said. [00:29:39] Speaker 03: Then they said something different at trial. [00:29:41] Speaker 03: Thank you. [00:29:42] Speaker 03: Thank you. [00:29:48] Speaker 02: You got 30 minutes. [00:29:50] Speaker 01: Thank you, Your Honor. [00:29:51] Speaker 01: What my colleague just said about the grounds for waiver under Fifth Circuit law is completely wrong. [00:29:55] Speaker 01: And I hope I have a chance to explain why, because it's wrong on about four different levels. [00:29:59] Speaker 01: We did cite cases in exactly this posture. [00:30:01] Speaker 01: The case called Wackman, we cite in the brief under the Fifth Circuit rules. [00:30:05] Speaker 01: In that case, the plaintiff had won a tortious interference with bequesting property claim. [00:30:12] Speaker 01: It went up on appeal. [00:30:14] Speaker 01: The defendant argued there's a legal problem with the theory they argued below, which was tortious interference with a will [00:30:20] Speaker 01: The prevailing plaintiff said, fine, but you can uphold the judgment because there was also evidence of tortious interference with a trust. [00:30:28] Speaker 01: The Fifth Circuit said two things. [00:30:29] Speaker 01: One, the jury instructions did permit the trust theory. [00:30:33] Speaker 01: The jury could have found it based on the instructions. [00:30:36] Speaker 01: But two, it was waived, and they were stopped from defending the judgment on that ground because they didn't argue to the jury. [00:30:42] Speaker 01: That's one. [00:30:44] Speaker 01: Under the Montana case under Fifth Circuit law, a party can make an admission in closing argument that binds that party on appeal. [00:30:51] Speaker 01: There, the government had conceded causation at closing argument. [00:30:55] Speaker 01: Here, they have conceded no actual knowledge. [00:30:57] Speaker 01: And the reason they have is that willful blindness is logically inconsistent with actual knowledge. [00:31:02] Speaker 01: Willful blindness is a lack of knowledge [00:31:04] Speaker 01: intentionally under the specified circumstances. [00:31:08] Speaker 01: They didn't argue actual knowledge and in the alternative you should at least think willful blindness. [00:31:12] Speaker 01: They only argued willful blindness in their opening and their closing. [00:31:15] Speaker 01: Three, there was a battle over jury instructions. [00:31:19] Speaker 01: They wanted an instruction that said don't consider the evidence relevant to our state law claims after we got a 50A against us on those. [00:31:26] Speaker 01: We said, no, that's still relevant to your intent. [00:31:29] Speaker 01: They told the judge, no, you misunderstand our theory of intent. [00:31:33] Speaker 01: It's only willful blindness. [00:31:34] Speaker 01: And then they had an argument why it's not relevant to that. [00:31:37] Speaker 01: And they got an instruction over our objection. [00:31:39] Speaker 01: That's judicial estoppel under opalusis. [00:31:41] Speaker 04: You have a site for that? [00:31:43] Speaker 01: Opalusis is judicial estoppel. [00:31:44] Speaker 04: No, the site where they made the concession that you say they set. [00:31:47] Speaker 01: Yes, your honor. [00:31:48] Speaker 01: The site for that is... [00:31:55] Speaker 01: I'm sorry. [00:31:57] Speaker 01: I thought I had it. [00:31:58] Speaker 01: Oh, here it is. [00:31:59] Speaker 01: 86218. [00:32:02] Speaker 01: Finally, in their rule 50B opposition, they did not respond to our claim that there was no evidence of actual knowledge under this court's decision in Promega, that an appellee can also waive by not raising an argument in response to a 50B. [00:32:15] Speaker 01: That's four reasons they've waived. [00:32:16] Speaker 01: Now, let me explain why that really matters here, and this goes to some of Judge Freeman's questions about the allegedly, literally infringing devices. [00:32:25] Speaker 01: Perhaps they could have had a theory on actual knowledge post-December 2010 on those devices. [00:32:30] Speaker 01: We still think we had good arguments that if we file a declaratory judgment action, we don't have the inducement intent. [00:32:35] Speaker 01: But say you disagree with all that, as my friend said. [00:32:38] Speaker 01: I didn't hear any response to him on how we could possibly be willfully blind after we file a declaratory judgment action. [00:32:45] Speaker 01: We've had counsel look at the claims, look at the products. [00:32:47] Speaker 01: We've asked the court to look at it and decide in our favor. [00:32:50] Speaker 01: And that's the only theory they pursued below. [00:32:51] Speaker 01: And the reason that's the only theory, if I could finish the sentence, [00:32:55] Speaker 01: This is what's really important. [00:32:56] Speaker 01: The reason that's the only theory they pursued below is they were seeking damages back to 2006 on another patent. [00:33:02] Speaker 01: They had no case for actual knowledge for the vast majority of that period, so they put all their eggs in the basket of willful blindness. [00:33:09] Speaker 01: Now they're trying to shift theories on appeal to defend the very minor judgment they got, as Judge Freeman points it out. [00:33:15] Speaker 01: So with that, we'd ask the court to reverse. [00:33:17] Speaker 02: Okay. [00:33:19] Speaker 02: We thank the party for their arguments. [00:33:22] Speaker 02: The case will be taken under submission.