Vertical Computer Systems Inc (fka VCSY)

[lbman]

Fresh Pacer from SF Courtesy of JonnyQwan Raging Bull #371413......


Interwoven moves to exclude VCSY's experts Testimony. To be decided on 6/20/2013.......



COUNTERCLAIMDEFENDANT
INTERWOVEN, INC.
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN FRANCISCO DIVISION
INTERWOVEN, INC.,
Plaintiff,
vs.
VERTICAL COMPUTER SYSTEMS, INC.,
Defendant.

Civil Case No. 3:10-cv-04645-RS
PLAINTIFF INTERWOVEN, INC.’S
REPLY IN SUPPORT OF MOTION TO
EXCLUDE THE TESTIMONY OF
JOHN MALY AND MOTION TO
STRIKE PORTIONS OF THE
DECLARATIONS FILED IN SUPPORT
THEREOF
Date: June 20, 2013
Time: 1:30 p.m.
Dept: Courtroom 3
Judge: Hon. Richard Seeborg


- ii -
PALOALTO 147039
INTERWOVEN’S REPLY I/S/OMOTION TO EXCLUDE MALY TESTIMONY
CASE NO. 3:10-CV-04645-RS
TABLE OF CONTENTS
Page(s)
I. INTRODUCTION ............................................................................................................... 1
II. MOTION TO EXCLUDE MALY’S TESTIMONY ........................................................... 1
A. Maly’s Testimony On The Doctrine Of Equivalents Is Unreliable And
Should Be Excluded ................................................................................................. 1
B. Maly’s Testimony Related To Indirect Infringement Is Unreliable And
Should Be Excluded ................................................................................................. 2
C. Maly’s Infringement Analysis Is Unreliable ............................................................ 3
1. Maly Does Not Show Interwoven Itself Has Practiced Every Step
Of The Methods Claimed In The ’744 Patent .............................................. 3
2. Maly Does Not Show That Interwoven Provides A Computer With
Processor And Memory As Required By The ’629 Patent .......................... 5
3. Maly Mixes Documents from Different Versions of the Accused
Products ........................................................................................................ 6
III. MOTION TO STRIKE PORTIONS OF THE MALY DECLARATION ........................... 7
A. Maly Should Not Be Allowed To Expand The Scope Of His Expert
Opinion ..................................................................................................................... 7
IV. MOTION TO STRIKE PORTIONS OF CLIFFORD KRAFT’S DECLARATION .......... 9
V. MOTION TO STRIKE PORTIONS OF AUBREY MCAULEY’S
DECLARATION ............................................................................................................... 11
VI. CONCLUSION .................................................................................................................. 13

- iv -
PALOALTO 147039
INTERWOVEN’S REPLY I/S/OMOTION TO EXCLUDE MALY TESTIMONY
CASE NO. 3:10-CV-04645-RS
Synthes et al v. Spinal Kinetics, Inc.,
Case No. 5:09-cv-01201, 2011 U.S. Dist. LEXIS 93093 (N.D. Cal. Aug. 19, 2011) ............ 11
Therasense, Inc. v. Becton, Dickinson & Co.,
Case No. 3:04-cv-02123, 2008 WL 2323856 (N.D. Cal. May 22, 2008) ............................... 10
Torres v. City of Los Angeles,
548 F.3d 1197 (9th Cir. 2008) ................................................................................................... 8
Uniloc USA, Inc., v. Microsoft Corp., 632 F.3d 1292 (Fed. Cir. 2011) .......................................... 5
Van Asdale v. Int’l Game Tech.,
577 F. 3d 989 (9th Cir. 2009) .................................................................................................... 9
Yeti by Molly, Ltd. v. Deckers Outdoor Corp.,
259 F.3d 1101 (9th Cir. 2001) ................................................................................................... 8
OTHER AUTHORITIES
Federal Rule of Civil Procedure 26(a) ................................................................................ 8, 11, 12
Federal Rule of Civil Procedure 26(e) ................................................................................ 8, 11, 12
Federal Rule of Civil Procedure 37(c)(1)........................................................................................ 8
Federal Rule of Evidence 702 ................................................................................................... 1, 11
Federal Rule of Evidence 403 ......................................................................................................... 2

PALOALTO 147039
INTERWOVEN’S REPLY I/S/OMOTION TO EXCLUDE MALY TESTIMONY
CASE NO. 3:10-CV-04645-RS
I. INTRODUCTION.
This Court should exclude Mr. Maly’s opinions regarding infringement; they fall far short
of the gatekeeping standards set forth by Federal Rule of Evidence 702 and are fundamentally
unreliable under Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 (1993). Should Mr. Maly’s
unreliable testimony be admitted, it would be confusing to the jury and severely prejudicial to
Interwoven. Vertical’s opposition and its supplemental declarations of Mr. Maly and Mr.
Clifford Kraft (in support thereof) to Interwoven’s Motion to Exclude John Maly’s Testimony
should be rejected for at least the following reasons:
• Vertical concedes that it does not have the evidence to support a finding of indirect
infringement, or infringement under the Doctrine of Equivalents;
• Mr. Maly failed to analyze a single alleged product accused of infringement;
• Portions of Mr. Maly’s supplemental report should be stricken because these
recently added opinions were provided outside the expert discovery period; and
• Portions of Mr. Kraft’s declaration, on which Mr. Maly relies, should be stricken
because they consist of unqualified and inadmissible expert opinion.
This court should also exclude the declaration of Mr. Aubrey McAuley, as it is untimely
and irrelevant to the issues for summary determination.
II. MOTION TO EXCLUDE MALY’S TESTIMONY.
A. Maly’s Testimony On The Doctrine Of Equivalents Is Unreliable And Should
Be Excluded.
Vertical concedes that it has not satisfied the requirements to show infringement under the
Doctrine of Equivalents. Yet, Vertical refuses to drop these allegations despite its own admission
that they lack factual support in the record. See Vertical’s Opposition to Interwoven’s Motion to
Exclude the Testimony of John Maly (“Opposition”) at 12.
Vertical’s seven-line rebuttal fails to refute Interwoven’s contention that Vertical has not
met its burden of showing infringement under the Doctrine of Equivalents. Mr. Maly made no
effort to show that any part of the accused products performs substantially the same function in
substantially the same way to achieve substantially the same result as any element of any claim of the patents-in-suit. Vertical Opposition at 11-12. Such methodology is improper under the
standards of Daubert and this district. See Rambus Inc. v. Hynix Semiconductor Inc., Case No.
5:05-cv-00334, 2008 WL 5411564, *2 (N.D. Cal. Dec. 29, 2008) (Whyte, J.) (granting summaryjudgment of non-infringement under the Doctrine of Equivalents where the expert failed to“compare or explain the equivalence between any particular feature and a limitation of an
asserted patent claim,” and instead did nothing more than “incant[] the magic words (once, in a footnote), but left out the analysis…”).
Rather than performing the required analysis, even Vertical admits that Mr. Maly neither identified any alleged differences nor showed that any alleged differences are insubstantial.1 See Vertical Opposition at 12 (asserting that, “f Interwoven had identified any differences, Mr.Maly would have shown in detail that those differences are entirely insubstantial”) (emphasis added). Moreover, Vertical emphasized “there are no differences” and that “[Vertical’s] doctrine of equivalents argument is in hypothetical form.” Vertical Opposition at 12. It is not Interwoven’s burden to identify to Vertical where it must make an argument under the Doctrine of Equivalents. “Expert evidence can be both powerful and quite isleading because of the difficulty in evaluating it.” See Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 589 (1993)

(“Rule 403 permits the exclusion of relevant evidence ‘if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury….’”). To allow Mr. Maly to provide these vague, conclusory, and fundamentally unreliable and unsupported statements on infringement under the Doctrine of Equivalents would unduly prejudice Interwoven.

B. Maly’s Testimony Related To Indirect Infringement Is Unreliable And
Should Be Excluded.
Vertical makes three passing references to indirect infringement in its entire Opposition.
See Opposition at 3, 5, and 11. These references only refer back to the boilerplate statements Mr.Maly made in his expert report, where the entirety of his opinion on indirect infringement 1 Interwoven acknowledges an inadvertent error in its opening brief on page 10 (as pointed out by Vertical in its opposition); however, this non-substantive error does not change the fact that Mr. Maly admitted he did not perform a Doctrine of Equivalents analysis separate from his
infringement analysis.

It is also my expert opinion that Interwoven induces others to
practice the patented invention and contributes to others infringing
the patented invention. Interwoven induces others to infringe
through their advertising and educational programs, and it
contributes to others infringing by providing updates, software
support and fixes.

See Declaration of Bijal V. Vakil in Support of Motion to Exclude the Testimony of John Maly (“Vakil Maly Decl.”) Ex. A at 11.
Mr. Maly does not point to even an iota of evidence supporting the opinions set forth in his expert reports. Vertical’s Opposition also does nothing to refute Interwoven’s assertion that this type of conclusory statement is unreliable.

C. Maly’s Infringement Analysis Is Unreliable.
Vertical attempts to mislead the Court with its statement that “Mr. Maly has had access to TeamSite and LiveSite products sold by Interwoven to its customers.” Opposition at 8. This statement implies that Mr. Maly used the TeamSite and LiveSite products, which is contradicted by his own deposition testimony. During his deposition, Mr. Maly admitted that he has never used any versions of the accused Interwoven product or looked at any source code.

See Reply Declaration of Bijal V. Vakil in Support of Motion to Exclude Testimony of John Maly (“Vakil Maly Reply Decl”) Ex. A at 89:24-90:2 (“Q. Have you ever used any version of the TeamSite
product? A. No, I have not.”). As outlined in Interwoven’s motion for summary judgment, Mr. Maly’s infringement analysis is also unreliable for the three reasons below. Vertical has provided no information in its Opposition that addresses these issues.

1. Maly Does Not Show Interwoven Itself Has Practiced Every Step Of
The Methods Claimed In The ’744 Patent.

To show direct infringement, Vertical must go beyond allegations of possible usage and show that Interwoven, itself, practices every step of the methods claimed in the ’744 patent.
See
Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299, 1311 (Fed. Cir. 2006) (“Method claims are only infringed when the claimed process is performed, not by the sale of an apparatus that is capable of
infringing use.”). Mr. Maly’s expert reports did not make such a showing. Instead, his reports merely stated that “it is my expert opinion that the TeamSite Product directly infringes each of
the asserted claims.” Vakil Maly Decl. Ex. A at 11 (emphasis added).” The “TeamSite Product” referenced by Mr. Maly is a complicated piece of software, with many features (many or most of which are unrelated to the claimed invention), and without the input of a person, does not do anything. See, e.g., Declaration of Vasilios D. Dossas in Opposition to Motion for Summary Judgment (“Dossas Decl.”) Ex. 25 (identifying numerous features of Teamsite, including “content authoring, multichannel delivery, site design and layout,multivariate testing, content targeting, rich media management, advanced analytics, workflow and approval, and archiving”).
At this fundamental level, the “TeamSite Product” is a piece of software that, on its own,does nothing and requires a separate actor to operate it and, potentially, perform the steps of the method. Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318, 1328 (Fed. Cir. 2008) (“The law of this circuit is axiomatic that a method claim is directly infringed only if each step of the claimed
method is performed.”) (emphasis added). See Dossas Decl. Ex. 8 at 200:7-9 (acknowledging possibility that users do not necessarily use TeamSite to practice all steps of the method of the patent,stating “I mean they could take the TeamSite’s software and put it on CDs in a big stack and use them as a doorstop”). For there to be direct infringement of the method claims of the ’744 patent, this actor must be Interwoven. If Interwoven itself does not actually use TeamSite to
perform all the steps of the claimed method, there can be no direct infringement. See Mirror Worlds, LLC v. Apple Inc., 692 F.3d 1351, 1359 (Fed. Cir. 2012) (holding that for direct infringement “[the patentee] has to show that [the alleged infringer] performed all of the steps in the claimed methods”). Mr. Maly’s expert reports supplied no opinions that Interwoven (or any party) actually
performed all of the steps of the method claimed in the ’744 patent. Vertical’s Opposition provides no additional analysis, and in eleven short lines instead only refers to Mr. Maly’s earlier report asserting in conclusory fashion that Mr. Maly found infringement. See Vertical Opposition at 11-12. Mr. Maly identifies no evidence showing Interwoven’s performance of all the steps of any of the asserted method claims of the ’744 patent, as required for a finding of
direct infringement. See Mirror Worlds, 692 F.3d at 1359.2
2. Maly Does Not Show That Interwoven Provides A Computer With
Processor And Memory As Required By The ’629 Patent.

As to the ’629 patent, Vertical does not argue that Mr. Maly analyzed whether the accused TeamSite products include hardware components. Vertical explains, instead, that such a determination was not necessary because hardware components are not required elements of the
‘629 patent claims. See Opposition at 10-11. This is incorrect. The ’629 patent claims each claim a system and recite “said system including a computer comprising a processor and a memory operably coupled to said processor.” Vakil Maly Decl. Ex. C at 7:19-20, 8:13-14, 8:64- 65 (emphasis added). Therefore, each of these claims unambiguously require computer hardware (i.e., a processor and a memory coupled to the processor). The Federal Circuit has evaluated
similar claims “comprising” hardware elements and held that they were not merely a preamble stating the invention’s field of use:
In this case, claim 16’s beginning and, in our view, controlling
language could hardly be clearer. Claim 16 states: ‘A centrifugal
2 With respect to any possible claim by Vertical of contributory infringement, those claims also fail as a matter of law. Mr. Maly admitted that his analysis did not focus on whether or not
TeamSite was capable of non-infringing uses (other than his facetious doorstop example). See Vakil Maly Reply Decl Ex. A at 202:19-203:1 (explaining he “focused primarily on infringing use” and expressing no opinion on non-infringing uses). Mr. Maly, likewise, failed to provide any serious response when asked if he had analyzed whether it might be possible that customers use TeamSite without also engaging in the patent’s required deployment step: “Sure, if they used it as a paperweight or if they used it for some very limited capability like revision control and rollback.” Id. at 203:14-16. In sum, Mr. Maly’s opinion that someone actually performs all the steps of the method in the ’744 patent is based entirely on assumptions and conjecture:
Like I said, you could never even break the shrink wrap on the package and you would not be—you would have purchased it, but
you would not be using it if you don’t even install it, so of course
it’s possible, but that’s I just don’t think it’s likely.
Id. at 204:24-205:3 (emphasis added). Despite the fact that proof of infringement requires a showing that the party accused of direct infringement itself performs each step of a claimed method, Mr. Maly does not know if any party at all performed the steps of the claimed method.This is no substitute for a thorough expert analysis that must be closely tied to the facts and data of the case. Uniloc USA, Inc., v. Microsoft Corp., 632 F.3d 1292, 1315 (Fed. Cir. 2011)
(excluding testimony for failure to tie expert theories to facts); see also General Elec. Co. v.Joiner, 522 U.S. 136, 147 (1997) (holding that the trial court may exclude testimony with “too
great an analytical gap” between the data and an expert opinion). With regard to direct infringement of the ’744 which requires a showing that Interwoven itself performed all of the steps of the claimed method, Mr. Maly has not provided any such analysis that is tied to the facts of the case, and his methodology is therefore unreliable under the Daubert standard.
unit comprising a centrifugal component and a plurality of tubes . . .
.’ It does not merely state the intended field of use in a preamble as
Haemonetics argues. Rather, it unambiguously defines ‘centrifugal
unit’ as ‘comprising’ two structural components: a centrifugal
component and a plurality of tubes. Haemonetics Corp. v. Baxter Healthcare Corp., 607 F.3d 776, 782 (Fed. Cir. 2010). Though Vertical attempts to diminish the importance of the “processor and a memory”
claim language, classifying it as part of a non-limiting preamble, Vertical relied upon the addition of this very language during prosecution of the ’629 patent to overcome a rejection from the
Patent Office. Vakil Maly Reply Decl. Ex. B at 2. In the rejection, the Examiner stated: “The claimed invention is directed to non-statutory subject matter. Newly amended claims . . . are directed toward a system and while a system itself is normally considered to consist of hardware,the hardware components in the present set of claims do not appear to exist.” Id. at 2 (emphasis added). In its Amendment dated May 1, 2009, Vertical responded to the rejection by amending each of the ’629 patent claims to specifically add hardware components by including the “computer comprising a processor and a memory” language. See Vakil Maly Reply Decl. Ex. C at 2, 4. Further, Vertical stated that the claims were being amended “to recite that the system includes a system comprising a processor and a memory operably coupled to the processor.” See id. at 6. Therefore, by Vertical’s own admission and limiting statements made during
prosecution, the ’629 claims each require a processor and a memory.
Because Mr. Maly has not evaluated any Interwoven product for the presence of a processor and a memory, Mr Maly’s opinions regarding infringement of the ’629 patent are fundamentally flawed and unreliable.

3. Maly Mixes Documents from Different Versions of the Accused
Products.
Maly should have used the only reliable methodology available to him to analyze the accused products in this case: look at and report on one particular version of TeamSite. Instead,Mr. Maly both failed to look at any source code or executable version of TeamSite or LiveSite,
and used a hodgepodge of documents from a number of versions to piece together an analysis.Interwoven argued that Vertical failed to present a comprehensive infringement allegation as to any one version of any accused product. See Motion at 6-8. Vertical asserted that it is not required to do so. Opposition at 8. As a threshold matter, Maly did not make any attempt to justify Vertical’s preparation of infringement contentions for a representative product—he did not
analyze materials for any one version of TeamSite and argue that it qualifies as a representative product. Instead, Maly began with an unauthorized third-party book, cherry picked some additional documents from different versions or modules of TeamSite, and alleged on this basis that all versions of TeamSite infringe, starting with the version available in 2004.

Vertical’s Opposition cites deposition testimony from one of Interwoven’s Rule 30(b)(6)witnesses, Shashi Mazumdar, in which Mr. Mazumdar noted that bug fixes and UI enhancements differentiated the major versions, though TeamSite was the same product from March 2006 to the present.3 Vakil Maly Reply Decl. Ex. D at 14:24-15:7. Vertical did not ask Mr. Mazumdar for any explanation of what constitutes bug fixes and UI enhancements; even though UI enhancements relate to the same type of features at issue here. Nor did Vertical did not ask any
questions of Mr. Mazumdar clarifying the changes made between each version of TeamSite, and whether or not such bug fixes and UI enhancements altered any features of TeamSite identified by Vertical in its infringement contentions.
To remedy Vertical’s failure to explore these critical questions and collect reliable information for his infringement analysis, Mr. Maly should have walked through specific differences with each version or attempted to identify (and justify the use of) a representative
product. He failed to do so. Without any evidence to support his uniform claims of infringement by all versions of the TeamSite product, and without any version-specific analysis, Mr. Maly’s
testimony on infringement should be excluded as outlined in the concurrently filed Motion to Strike.

III. MOTION TO STRIKE PORTIONS OF THE MALY DECLARATION.
A. Maly Should Not Be Allowed To Expand The Scope Of His Expert Opinion.
To support Vertical’s Opposition to Interwoven’s Motion for Summary Judgment, Mr.3 Mr. Mazumdar brought a list of versions of TeamSite to his deposition for discussion. Vakil Reply Decl. Ex. E (listing versions 6.7.0 through 7.3.2). The version that was the basis for
the unauthorized third-party book, 6.5, was not even one of the versions on this list. Dossas Decl.Ex. 12 at 120:4-7 (“Q. Okay, but because 6.5 is mentioned in the book, you think that 6.5 was the
version that you were dealing with? A. Right.”).
Maly provides new opinions on alleged infringement based on examples without any evidentiary support. See Dossas Decl. Ex. 5 at ¶¶ 91-97. He provided these opinions for the first time in connection with this motion practice, well after the close of expert discovery. It is highly prejudicial to allow this type of trial by ambush. KFD Enterprises, Inc. v. City of Eureka, Case No. 3:08-cv-04571, 2013 WL 2384236, at *2 (N.D. Cal. May 30, 2013) (Corley, J.) (“The
purpose of the rule is to prevent surprise or ambush at trial.”).
It is well-established that an expert witness must prepare a written report containing a complete statement of all opinions the witness will express and the basis and reasons for them. See Fed. R. Civ. P. 26(a); Torres v. City of Los Angeles, 548 F.3d 1197, 1212 (9th Cir. 2008).4 Not once did Mr. Maly refer to any of these newly added examples in either of his reports or during his deposition. There is no excuse for the failure to disclose these opinions earlier.
Mr. Maly’s declaration fails to qualify as a supplemental expert report. Any supplemental expert report must be made “in a timely manner” when the prior report is determined to be “incomplete or incorrect.” Hoffman v. Constr. Protective Servs., Inc., 541 F.3d 1175, 1179 (9th Cir. 2008). “Although Fed.R.Civ.P. 26(e) requires a party to ‘supplement or correct’ disclosure upon information later acquired, that provision does not give license to sandbag one’s opponent with claims and issues which should have been included in the expert witness’ report[.]”5 KFD Enterprises, Inc. v. City of Eureka, Case No. 3:08-cv-04571, 2013 WL 2384236, at *2 (N.D. Cal.
May 30, 2013) (Corley, J.). Federal Rule of Civil Procedure 37(c)(1) “gives teeth to [this requirement]” and forbids the use of such testimony on a motion, at a hearing, or at a trial, if the
4 The Federal Circuit applies the law of the appropriate regional circuit in reviewing evidentiary rulings, which are procedural matters not unique to patent law. Chimie v. PPG Indus., Inc., 402 F.3d 1371, 1376 (Fed. Cir. 2005); see also O2 Micro Int’l Ltd. v. Monolithic Power Sys., Inc., 467 F.3d 1355, 1368 (Fed. Cir. 2006) (applying Ninth Circuit’s abuse of discretion standard for denial of leave to supplement expert report). 5 Vertical has not provided any justification for its new infringement theory designed to oppose Interwoven’s motion for summary judgment. To the extent Vertical claims this is in response to a “new” argument, such claims are contradicted by the rebuttal report prepared by Interwoven’s expert, Dr. George Necula. The Necula Report contains the same arguments
regarding interchangeability set forth in Interwoven’s motion for summary judgment. Vertical should not be permitted to use this evidence in its motion absent a showing of harmlessness or
substantial justification—a showing Vertical has not even attempted to make. See Yeti by Molly,Ltd. v. Deckers Outdoor Corp.,259 F.3d 1101, 1106 (9th Cir. 2001) (The party facing exclusion
of newly disclosed information has the burden to prove that the “failure to disclose the required information is substantially justified or harmless.”).
information is not properly disclosed in accordance with Rule 26(a)). Id. Interwoven should not be forced to contend with new expert opinions or an improper supplemental expert witness report
on this key issue on the eve of trial. Accordingly, paragraphs 91-97 of Mr. Maly’s declaration should be stricken.Finally, Paragraphs 78-89 of Mr. Maly’s declaration should also be excluded because the
underlying document is based on unreliable hearsay from Mr. Clifford Kraft. While an expert can rely on hearsay, he cannot base his opinion on unreliable methodology. As described in the
concurrently filed reply in support of Interwoven’s Motion for Summary Judgment, Mr. Kraft is not qualified to render the expert opinions he provided to Mr. Maly. Here, Mr. Maly included a
report, authored by Mr. Kraft,6 in the body of his declaration describing events and actions in which Mr. Maly did not participate, and that Mr. Maly did not supervise, direct, or independently
verify, as he acknowledged during his deposition. See, e.g., Vakil Maly Reply Decl. Ex. A at 94:22-24 (“Q. You were not present during the September 21st, 2012 site inspection; is that correct? A. Right.”). Mr. Maly declaring that he had any personal knowledge of the inspection,contradicting his prior deposition testimony, is also impermissible. Van Asdale v. Int’l Game Tech., 577 F. 3d 989, 998 (9th Cir. 2009) (“The general rule in the Ninth Circuit is that a party cannot create an issue of fact by an affidavit contradicting his prior deposition testimony.”). Thus, the paragraphs in Mr. Maly’s declaration that were based on information received from Mr.
Kraft should be stricken.

IV. MOTION TO STRIKE PORTIONS OF CLIFFORD KRAFT’S DECLARATION.
Vertical relies on a declaration by Mr. Kraft, who claims to have “read The Definitive Guide to Interwoven TeamSite” and “confirmed that the TeamSite product is substantially as
described in The Definitive Guide and that it has not changed in any significant way since the 2006 publication of The Definitive Guide.” Dossas Decl. Ex. 4 at ¶¶ 3-4. Vertical never disclosed Mr. Kraft as an expert and he also never submitted an expert report. He is a paid
consultant of Vertical’s counsel, who had the option to try qualifying him as an expert in a timely fashion. Vertical relies upon Mr. Kraft’s opinions by including them in the opinions of its
6 Mr. Kraft is a paid consultant for Vertical’s outside counsel, Niro, Haller & Niro Ltd.

infringement expert, Mr. Maly.
One cannot simply transform lay witness testimony to expert testimony in this manner.Under the circumstances, Mr. Maly could only rely on his testimony if the work was reliably done at his request or direction, which it clearly was not. See Therasense, Inc. v. Becton,
Dickinson & Co., Case No. 3:04-cv-02123 WHA, 2008 WL 2323856 (N.D. Cal. May 22, 2008)(Alsup, J.) (excluding expert testimony for reliance on results of experiments in which the expert “did not participate in, observe, or supervise any of the experiments”); MTX Commc’ns Corp. v.LDDS/WorldCom, Inc., 132 F. Supp. 2d 289, 292-93 (S.D.N.Y. 2001) (holding testimony inadmissible because it was based on information that “was neither verified nor submitted in a
way that permits meaningful review” and is “unreliable in that a major ingredient . . . is itself lacking in sufficient indicia of reliability to be put before the jury”). However, since Mr. Kraft’s
inspection was not done at Mr. Maly’s request or direction, this Court should exclude any reliance upon it in Vertical’s motions.
The Kraft declaration adds statements that were kept hidden during the discovery period.This is not how discovery should proceed under the Federal Rules of Civil Procedure. Moreover,the statements are untimely and unreliable. While Mr. Kraft may have a “doctorate degree in Electrical and Computer Engineering” and “experience in the design and development of large hardware and software systems,” there is no evidence that Mr. Kraft has any understanding of
software development tools for creating websites. Dossas Decl. Ex. 4 at ¶ 2. Mr. Kraft’s opinion also lacks an element-by-element comparison of the purported product in The Definitive Guide
with the product he inspected, the version of which he did not identify, and which Mr. Maly did not confirm. Mr. Kraft also purports to have tested creating, calling by name, and interchanging
components, the results of which were reported to Mr. Maly for his infringement analysis. Not only were these tests not directed, verified, or performed by Mr. Maly, but upon his first look at
Mr. Kraft’s inspection results (in the form of a number of screenshots), Mr. Maly was not even able to understand what they represented. Vakil Maly Reply Decl. Ex. A at 101:22-23 (“A. When
I first was given the screen shots it was not clear to me what was going on in them.”) This is not the careful analysis one of ordinary skill in the art would have performed.

As Mr. Kraft is not a properly disclosed and qualified expert, the Court should exclude his opinion regarding whether the software has changed and whether the software meets elements of the asserted patent claims. See Synthes et al v. Spinal Kinetics, Inc., Case No. 5:09-cv-01201,2011 U.S. Dist. LEXIS 93093, at *22-23 (N.D. Cal. Aug. 19, 2011) (Whyte, J.) (striking the technical testimony and conclusory statements of a non-expert, holding that “it is an abuse of
discretion to permit a witness to testify as an expert on the issues of noninfringement or invalidity unless that witness is qualified as an expert in the pertinent art” (quoting Sundance, Inc. v.
DeMonte Fabricating Ltd., 550 F.3d 1356, 1363 (Fed. Cir. 2008))). Expert opinions have specialized reliability and disclosure requirements based on Federal Rule of Evidence 702 and Daubert. Vertical’s use of Mr. Kraft’s declaration is an attempt to circumvent these established requirements by introducing unreliable expert testimony under the guise of layperson testimony.
If Vertical had sought to qualify Mr. Kraft as an expert, then Mr. Kraft would have needed to abide by the expert disclosure requirements of Federal Rule of Civil Procedure 26(a)(2) by
preparing and signing a written report, and follow reliable methodology as required of experts. Mr. Kraft should also have been disclosed pursuant to the stipulated protective order, and would
have had to be available for discovery. See Dkt. No. 120.
Finally, this new theory—that there were no significant differences between the inspected product and the product described in the Definitive Guide—was not disclosed or supplemented in accordance with the requirements of Rules 26(a) and 26(e), and should be precluded on that ground as well. See Apple, Inc. v. Samsung Elecs. Co., Case No. 5:11-cv-01846, 2012 WL 3155574, at *4 (N.D. Cal. Aug. 2, 2012) (Koh, J.) (“Rule 37 mandates that a party’s failure to comply with the obligations under Federal Rule of Civil Procedure 26(e)(1) results in that party being precluded from ‘use [of] that information . . . to supply evidence on a motion, at a hearing or at trial, unless the failure was substantially justified or is harmless.’” (quoting Fed. R. Civ. P.
37(c)(1))).


V. MOTION TO STRIKE PORTIONS OF AUBREY MCAULEY’S DECLARATION.
Vertical submitted a declaration of Mr. Aubrey McAuley in support of its Oppositions to Interwoven’s motions. The declaration only appears to contain information irrelevant to the issues for summary determination, and is also an untimely disclosure. In Paragraph 2 of Mr. McAuley’s declaration, he alleges contact with Messrs. Livaudais
and Miller, each of who were previous employees of Interwoven. Any testimony about these meetings, including paragraph 2, should be stricken for failure to comply with Rule 26. Vertical
would have already known of any alleged meetings with Interwoven employees long ago, and should have disclosed relevant individuals so Interwoven could have taken appropriate discovery. It is too late now to introduce new individuals purported to have information relevant to
Vertical’s claims. Vertical was required to disclose the existence of these witnesses long ago in accordance with the Federal Rules of Civil Procedure, Patent Local Rules, and through the discovery
exchanged in this case. Vertical failed to disclose either Mr. Livaudais or Mr. Miller in its May 26, 2011 initial disclosures—or any time since—as persons with discoverable information that
Vertical may use to support its claims, in clear disregard of the requirements of Federal Rule of Civil Procedure 26(a). See Fed. R. Civ. P. 26(a)(1)(A)(i) (“A party must . . . provide to the other
parties . . . the name . . . of each individual likely to have discoverable information—along with the subjects of that information—that the disclosing party may use to support its claims or
defenses . . . .”). Instead, Vertical kept its alleged “evidence” close to its vest until now, using it to oppose Interwoven’s motions for summary judgment.7 KFD Enterprises, Inc. v. City of
Eureka, Case No. 3:08-cv-04571, 2013 WL 2384236, at *2 (N.D. Cal. May 30, 2013) (Corley, J.)

(“The purpose of [Federal Rule of Civil Procedure 26(e)(1)(A)] is to prevent surprise or ambush at trial.” ).

Vertical’s use of Mr. McAuley’s new declaration also violates Patent Local Rule 3-1(h), which requires a party to disclose the basis of any willful infringement allegations in its infringement contentions. Alleged copying should have been part of Vertical’s willful infringement allegations. However, Vertical failed to disclose the existence of a purported 7 Had Vertical revealed these individuals at the proper time as sources of information relevant to its willful infringement allegations, Interwoven would have taken appropriate
discovery and depositions. Interwoven noticed for deposition every person disclosed by Verticalin its initial disclosures.
presentation made by Mr. McAuley to Mr. Livaudais and Mr. Miller in either its May 26, 2011 Infringement Contentions or its August 31, 2012 Amended Infringement Contentions. See Vakil Maly Reply Decl. Ex. F at 11. “[The] purpose underlying Rule 3-1 is to require the party claiming infringement to crystallize its theories of the case early in the litigation and to adhere to those theories once disclosed.” Bender v. Adv. Micro Devices, Inc., Case No. 3:09-cv-01149, 2010 WL
363341, at *1 (N.D. Cal. Feb. 1, 2010) (Chen, J.).

VI. CONCLUSION.
For at least the reasons set forth in Interwoven’s Motion to Exclude the Expert Testimony of John Maly, this Court should exclude the inadmissible opinions set forth by Mr. Maly and strike the portions of Mr. Maly’s, Mr. Kraft’s, and Mr. McAuley’s declarations indicated above.


PALOALTO 147039
INTERWOVEN’S REPLY I/S/OMOTION TO EXCLUDE MALY TESTIMONY
CASE NO. 3:10-CV-04645-RS
Dated: June 10, 2013 Respectfully submitted,
By: /s/ Bijal V. Vakil
Bijal V. Vakil
JACK Q. LEVER, JR. (pro hac vice)
[e-mail]
BIJAL V. VAKIL (Cal. Bar No. 192878)
[e-mail]
JENNIFER P. GOSSAIN (Cal. Bar No. 254174)
[e-mail]
THOMAS C. FLYNN (Cal. Bar No. 257945)
[e-mail]
WHITE &CASE LLP
3000 El Camino Real
5 Palo Alto Square, 9th Floor
Palo Alto, CA 94306
Telephone: [phone]
Facsimile: 650.213.8158
EDWARD G. POPLAWSKI (Cal. Bar No. 113590)
[e-mail]
OLIVIA M. KIM (Cal. Bar No. 228382)
[e-mail]
WILSON SONSINI GOODRICH &ROSATI
633 West Fifth Street, 15th Floor
Los Angeles, CA 90071
Telephone: [phone]
Facsimile: 866.974.7329
ATTORNEYS FOR PLAINTIFF AND COUNTERCLAIMDEFENDANT
INTERWOVEN, INC.