13-08-30 Samsung Motion to Strike Portions of Apple Damages Report

7/30/2019 13-08-30 Samsung Motion to Strike Portions of Apple Damages Report

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2198.51855/5494997.3 Case No. 11-cv-01846-LHK

SAMSUNGS MOTION TO STRIKE PORTIONS OF THE EXPERT REPORT OF JULIE L. DAVIS

QUINN EMANUEL URQUHART & SULLIVAN, LLPCharles K. Verhoeven (Bar No. 170151)[email protected] California Street, 22nd FloorSan Francisco, California 94111Telephone: (415) 875-6600

Facsimile: (415) 875-6700

Kevin P.B. Johnson (Bar No. 177129)[email protected] F. Maroulis (Bar No. 202603)[email protected] Twin Dolphin Drive, 5th FloorRedwood Shores, California 94065-2139Telephone: (650) 801-5000Facsimile: (650) 801-5100

William C. Price (Bar No. 108542)[email protected]

Michael T. Zeller (Bar No. 196417)[email protected] S. Figueroa St., 10th FloorLos Angeles, California 90017Telephone: (213) 443-3000Facsimile: (213) 443-3100

Attorneys for SAMSUNG ELECTRONICSCO., LTD., SAMSUNG ELECTRONICSAMERICA, INC. and SAMSUNGTELECOMMUNICATIONS AMERICA, LLC

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA, SAN JOSE DIVISION

APPLE INC., a California corporation,

Plaintiff,

vs.

SAMSUNG ELECTRONICS CO., LTD., aKorean business entity; SAMSUNG

ELECTRONICS AMERICA, INC., a NewYork corporation; SAMSUNGTELECOMMUNICATIONS AMERICA,LLC, a Delaware limited liability company,

Defendant.

CASE NO. 11-cv-01846-LHK

SAMSUNGS MOTION TO STRIKE

PORTIONS OF THE EXPERT REPORT

OF JULIE L. DAVIS

Date: October 10, 2013Time: 1:30 p.m.Place: Courtroom 8, 4th FloorJudge: Hon. Lucy H. Koh

PUBLIC REDACTED VERSION

Case5:11-cv-01846-LHK Document2386 Filed08/30/13 Page1 of 10
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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Case No. 11-cv-01846-LHK


PLEASE TAKE NOTICE that on October 10, 2013, at 1:30 p.m., or as soon as the matter

may be heard by the Honorable Lucy H. Koh in Courtroom 8, United States District Court for the

Northern District of California, Robert F. Peckham Federal Building, 280 South 1st Street, San

Jose, CA 95113, Samsung Electronics Co., Ltd., Samsung Electronics America, Inc., and Samsung

Telecommunications America, LLC (collectively, Samsung) shall and hereby do move pursuant

to the Courts April 29, 2013 and August 22, 2013 Case Management Orders for an order striking

portions of the Expert Report of Julie L. Davis, CPA.

This motion is based on this notice of motion and supporting memorandum of points and

authorities; the Declaration of Robert J. Becher (BecherDecl.) and exhibits thereto; and such

other written or oral argument as may be presented at or before the time this motion is taken under

submission by the Court.

RELIEF REQUESTED

An order striking certain identified paragraphs, and the corresponding portions of the

Expert Report of Julie L. Davis, CPA.

STATEMENT OF ISSUES

Whether the Expert Report of Julie L. Davis, CPA includes new theories, new

methodologies, new data, and new damages periods.

DATED: August 30, 2013 QUINN EMANUEL URQUHART &SULLIVAN, LLP

By/s/ Victoria F. Maroulis

Victoria F. MaroulisAttorney for SAMSUNG ELECTRONICS CO.,LTD., SAMSUNG ELECTRONICS AMERICA,

INC., and SAMSUNGTELECOMMUNICATIONS AMERICA, LLC



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INTRODUCTION

The Court ruled that the sole purpose of the [new] trial is to correct for the erroneous

notice dates (Dkt. 2316 at 2-3), and the parties are thus limited to the theories raised in the first

trial. See, e.g., Becher Decl.1

Ex. 4, 4/29/13 Hrg. Tr. at 67:17-21. The Court explicitly instructed

that there can be no variations other than the notice date. Id. at 65:12-21; see also 70:12-13

(No new theories, no new methodologies, no new data, no new damages period.). Despite the

Courts rulings, Apples new expert, Ms. Davis, attempts to increase Apples claimed damages by

(a) presenting damages methodologies and damages periods that Mr. Musika did not discuss in his

reports or at trial; (b) proffering opinions and calculations that the Court previously excluded; and

(c) relying on exhibits and testimony that Mr. Musika did not cite in his report or discuss at trial.

While the changes may look small on paper, they result in the addition of hundreds of millions of

dollars in additional claimed damages, severely prejudice Samsung, and should be stricken.

I. MS. DAVISS NEW THEORIES SHOULD BE STRICKENA. Ms. Daviss Lost Profits | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |Ms. Davis improperly changes Mr. Musikas method for calculating Apples lost profits in

order to claim over| | | | | | | | more than the amount of lost profits Apple sought at the first trial

for the same 13 products at issue in the new trial. Compare Davis Rpt. Ex. 17.1-PT-H (| | | | | | | | |

in lost profits for the 13 new trial products) with PX25A1.4 ($385,937,640 in lost profits for the

same 13 products). Mr. Musikas method for calculating lost profits assumed that Samsung would

design around Apples asserted intellectual property, and that Apple should be entitled to lost

profits only during those hypothetical design around periods. See Trial Tr. at 2084:3-19. Mr

Musika assumed those design around periods | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | Musika Rpt. 129.

1 Copies of the Davis Report, Musika Report, and Supplemental Musika Report are attachedas Exhibits 1-3 to the Declaration of Robert J. Becher (Becher Decl.). A redlined comparison othe Davis Report and the Musika Report are attached as Exhibit 4 to the Becher Declaration.



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In contrast, Ms. Davis now includes calculations that | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Davis Rpt. 93; Becher Decl. Ex. 5

8/26/13 Davis Dep. Tr. at 110:5-12, 130:21-131:3. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Ms. Davis increases Apples lost profits claim

by more than $305 million, as compared to her calculations using Mr. Musikas methodology

where the design around period started as of the date of first infringement. Compare Davis Rpt

Ex. 17.1-PT-H (| | | | | | | | | | | | | | in lost profits using new theory) with Ex. 17.1-PT-J (| | | | | | | | | |

in lost profits using Mr. Musikas original theory); Becher Decl. Ex. 5 at 134:12-20.2

The Court previously barred Mr. Musika from presenting the methodology that Ms. Davis

now seeks to use, because it was not timely disclosed in his expert reports. Dkt. 1678, 1690. The

Court held: Mr. Musika did not timely disclose his calculations pursuant to an alternative two

notice period theory. Dkt. 1690 at 2. Under Mr. Musikas excluded two notice period theory,

Apple sought to increase its claimed damages by shifting certain design around periods to start

after first infringement, as Ms. Davis has done. See, e.g., Davis Rpt. Ex. 17.2-PT-H, 17.2-PT-I.3

The Court precluded Mr. Musika from doing so. Because the Courts ruling excluding Mr

Musikas alternate lost profits theory remains binding, Ms. Daviss new calculations should be

stricken. See Dkt. 2316 at 2-3 (prior rulings on . . . evidentiary objections remain in effect as law

of the case.); Becher Decl. Ex. 6, 8/21/13 Hrg. Tr. at 12:14-16 ([A]nything that was previously

excluded . . . does not fall within the proper scope of this trial.).4

2 Ms. Davis knew this would be a problem and thus included an alternative set of calculations

that adhere to Mr. Musikas methodology, specifically Exhibits 17-PT-J and 17-PT-K. Tellinglyusing her new methodology, Ms. Davis calculates lost profits | | | | | | | | | | | | | | | | | | | | despite thefact that Mr. Musika did noteither in his reports or at trial. | | | | | | | | | | | | | | | | | | | | | | | | | | | || | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

3 The two notice period theory is shorthand for the fact that shifting these design aroundperiods results in two lost profits periods per productone lost profits period for the 381 patentthat starts on August 4, 2010, and one for other patents that starts on the filing of the complaint oramended complaint.

4 This outcome is consistent with the Courts application of these rules to Samsung. At theApril 29, 2013 CMC, Samsung requested that it have an opportunity to present to the jury

(footnote continued)



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Ms. Daviss new approach is also contrary to Federal Circuit law. When calculating los

profits, courts look to whether noninfringing design arounds are available starting on the date of

first infringementeven if it is earlier than the notice date. In Grain Processing Corp. v

American Maize-Products Co., 185 F.3d 1341, 1347 n.3 (Fed. Cir. 1999), the patent holder could

not recover damages for infringing sales prior to giving notice via filing its complaint in 1981,

because it did not mark its products. The court found that because a non-infringing alternative

first used in 1991 could have theoretically been implemented in 1979, the defendant could have

completed its design around before receiving notice. Id. at 1347-48. Accordingly, the Federa

Circuit affirmed the denial of lost profits. Id. at 1353-55.5

Likewise, in Power Integrations, Inc. v. Fairchild Semiconductor Intl., 711 F.3d 1348

(Fed. Cir. 2013), the Federal Circuit distinguished between (1) the bar on recovery of damages for

failure to mark or provide actual notice under 35 U.S.C. 287, and (2) the hypothetical

reconstruction of the market for purposes of calculating lost profits, which takes place at the date

of first infringement regardless of actual notice. See id. at 1378-1379 (finding error in a lost

profits award where the price erosion analysis used the date of actual notice, rather than the date of

first infringement). As the Federal Circuit explained, what the patentee would have made but for

the infringementrequires analysis ofinfringement-free market conditions, and thus the proper

starting point of such a price erosion analysis is the date of first infringement. Id. at 1379.6 Ms

different damages period." (Becher Decl. Ex. 4 at 81:14-16.) Apple vociferously opposed (id. at81:17-23) and the Court denied Samsungs request.

5 Ms. Davis improperly relies on | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | || | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | But the March 1 Order says nothing about the properperiod to evaluate available non-infringing alternatives for lost profits purposes and should not beinterpreted to contradict Federal Circuit precedent.

6 In her reasonable royalty opinion, Ms. Davis acknowledges that design arounds should beconsidered as at the date of first infringement, as she must under governing law. SeeWang LabsInc. v. Toshiba Corp., 993 F.2d 858, 869-870 (Fed. Cir. 1993) (hypothetical negotiations shouldbe as of date of patent issuance, even if this was before the notice date); Laserdynamics, Inc. vQuanta Computer, Inc., 694 F.3d 51, at 75 (Fed. Cir. 2012) (the six year limitation on recovery ofpast damages does not preclude the hypothetical negotiation from taking place on the dateinfringement started, even if damages cannot be collected until a later time) (citing Wang, 993F.2d at 870). Panduit Corp. v. Stahlin Bros. Fibreworks, Inc., 575 F.2d 1152, 1156 (6th Cir1978), recognized that the date for evaluating noninfringing substitutes for a lost profits analysis isthe date of first infringement, the same as the date for evaluating a hypothetical negotiation. Id. at

(footnote continued)



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Daviss attempt to | | | | | | | | | | | | | | | | | | | | | | | | | | | | | violates this cardinal principle by assuming

that Samsung | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

Accordingly, Ms. Daviss new opinions that move the start of the hypothetical design

around periods should be stricken as new, contrary to the Courts orders, and inconsistent with

Federal Circuit precedent.

B. Ms. Daviss New Opinion on Apples Sales Capacity Should Be StrickenIn her report, Ms. Davis concedes that | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

Nonetheless, she asserts that | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Id. At her deposition, Ms

Davis clarified that this includes | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | This | | | | | | | | | | opinion is entirely new. It is

nowhere to be found in Mr. Musikas reports, deposition transcript, or trial testimony. Indeed, Mr

Musika agreed at trial that Apple had no capacity to make any additional sales of the iPhone 4

from June through October 2010. Trial Tr. at 2141:13-2142:14 (Q. And this is a time [June

October 2010] when Apple couldnt even service its own customers for the iPhone 4; correct? A

[Mr. Musika] Well, yes, with the iPhone 4. They had available iPhones, but not the iPhone 4.)

At no point did Mr. Musika say that Apple could have | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

as Ms. Davis now asserts for the first time. Ms. Daviss new opinion should be stricken.

C. Ms. Daviss New Infringers Profits Theories Should Be StrickenAt trial, Apple sought infringers profits solely based on Samsungs gross profits. Now

Apple seeks to inflate its potential damages by presenting two additional theories of infringers

profits| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

Mr. Musika never calculated infringers profits equal to Samsungs incremental profit on

1162. Indeed, thePanduitcourts analysis of non-infringing substitutes for purposes of assessinglost profits and a reasonable royalty was one and the same. Id. at 1156, 1161, 1162.



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a product-by-product basis in his expert reports or at trial. See Musika Rpt. 151 | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Becher Decl. Ex. 5 at 274:4-19, 276:16-24. Mr

Musika did not even mention incremental profits to the jury. Trial Tr. at 2031-2172. Yet, Ms

Davis now calculates infringers profits for each of the 13 products at issue in the new trial based

on | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | See, e.g., Davis Rpt. Ex. 17.1-PT-I;see also id. at Ex

50.1-PT - Ex. 50.9-PT.

Apple has claimed that Ms. Daviss | | | | | | | | | | | | | | | | | theory is not new because she used

Mr. Musikas methodology. But Mr. Musika only calculated overall | | | | | | | | | | | | | | | | | foral

Samsung products (including non-accused products). See Musika Rpt. Ex. 50-S; Trial Tr. at

2058:4-6 (admitting that PX28 (identical to Ex. 50-S) shows the numbers for the overall entity,

and includes other sales of non-accused items.). Mr. Musika nevercalculated | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Ms. Davis now does both. Her new | | | | | | |

| | | | | | | | theorywhich calculates as much as | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | should be stricken.

Ms. Daviss presentation of infringers profits based on | | | | | | | | , see, e.g., Davis Rpt. Ex

17-PT-H, Ex. 18-PT-H, is inconsistent with Apples assurances that it would present the same

calculation of deductible expenses. Becher Decl. Ex. 4 at 59:21-62:12. Although Mr. Musikas

expert report included calculations of Samsungs revenue, at trial, Mr. Musika presented

infringers profits as equal to Samsungs gross profits. See Trial Tr. at 2053:17-2055:16. Mr

Musika did not dispute that Samsung was entitled to deduct at least some costs. Id. at 2063:23-24

see also id. at 2066:18-19 (in deducting costs, he stop[ped] at the gross profit line).

D. The Court Should Strike Ms. Daviss New Descriptions of the Utility PatentsMs. Daviss descriptions of the 381, 915 and 163 patents (Davis Rpt. 27-29) differs

dramatically from Mr. Musikas descriptions (Musika Rpt. 11, 13, 15). As shown by the redline

comparing the experts descriptions of the patents, her descriptions broaden and change the scope

of the patented technology. Becher Decl. Ex. 7. This unjustified change should not be allowed.



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E. Ms. Davis Offers Opinions That Have Already Been ExcludedDuring the first trial, the Court barred Apple from offering testimony that Samsung

[v]iolated court orders to produce financial records, and limited Apple to asking Mr. Musika a

single leading question related to Samsungs discovery conduct. Dkt. 1668 at 1-2. Yet, Ms. Davis

purports to | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | See, e.g., Davis Rpt. 145, 147-148, 152-155

Additionally, in itsDaubertruling, the Court excluded Mr. Musikas opinion that Apple suffered

irreparable harm as a result of Samsungs alleged infringement, and his opinion that Samsungs

cost data failed to meet Samsungs burden of proving deductible expenses. Dkt. 1157. Ms. Davis

revives both of these opinions by devoting an entire section of her report to | | | | | | | | | | | | | | | | | | | |

| | | (Davis Rpt. 74-88) and opining on | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | (id. at 162). The Court should enforce its prior rulings and strike these opinions. See Dkt

2316 at 2-3 (prior rulings on . . . evidentiary objections remain in effect as law of the case.).

II. THE COURT SHOULD STRIKE MS. DAVISS RELIANCE ON NEW EVIDENCEMs. Davis relies on dozens of documents that Mr. Musika did not cite in his reports or at

trial. For example, while Mr. Musikas lost profits analysis relied on the documents listed in

Exhibits 24 and 25 to his original report as evidence of demand for the patented products (Musika

Rpt. 121-122; see also Musika Supp. Rpt. Ex. 24-S), Ms. Davis cites numerous additional

documents.7 Ms. Davis relies on this evidence | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ,

even though Mr. Musikas reports did not cite these materials.8 All these references should be

7 See Davis Rpt. 106, 134, 136, 137, 41-42, 58-60 (citing SAMNDCA00214969SAMNDCA10246338, PX58, PX60, PX62, PX55, PX2261, PX186, PX21A, PX7, PX8, PX3PX6 and PX174).

8 Davis Rpt. 133 (citing APLNDC-Y0000146961, APLNDC-Y0000233381, APLNDC-Y0000234932, APLNDC-Y0000235973, PX142, PX11, PX12, PX13 and PX127).



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stricken. See Becher Decl. Ex. 6 at 20:24-21:4 (acknowledging that the Courts ordercompelled

[Ms. Davis] to give exactly the same opinions that Mr. Musika gave . . . using the same documents

he used).

Ms. Davis also relies extensively on testimony not cited by Mr. Musika in his reports or at

trial. First, Ms. Davis cites deposition transcripts and declarations that do not appear anywhere in

Mr. Musikas reportsincluding the declaration of Eric Roberts, a Morrison Foerster employee

who was never deposed in this case.9 Second, Ms. Davis relies on the trial testimony of severa

individuals, including Scott Forstall, Chris Stringer, Russell Winer, Susan Kare, Peter Bressler

and Dong Hoon Chang, none of whom were even mentioned in Mr. Musikas reports or trial

testimony. Davis Rpt. 135, 136. Finally, Ms. Davis belatedly addresses testimony that Mr

Musika did not respond to at trial. Id. (Junyeun Wang); see also id. at 165 (Tim Sheppard)

Because Apple chose not to recall Mr. Musika for further testimony at the conclusion of

Samsungs case, Ms. Davis should not be permitted to address this testimony.

Finally, Mr. Musika testified at trial about just four trial exhibits.10 Trial Tr. at 2031-2172

(testimony limited to PX25A1, PX28, PX34 and PX194). In contrast, Ms. Davis refers to dozens

of documents about which Mr. Musika did not testify, and which are directed to liability issues,

rather than damages. See, e.g., Davis Rpt. 132, 166, 254-256. Apples transparent strategy is to

introduce its entire liability case through Ms. Davis. Such testimony is impermissible.

9 Davis Rpt. at 147 (citing 2/28/12 Decl. of Eric R. Roberts); id. at 152-153 (3/31/12Depo, of Jaehwan Sim).

10 Samsung understands the Courts order as limiting Ms. Daviss trial testimony to theevidence Mr. Musika presented to the jury at trial. See, e.g., Becher Decl. Ex. 4 at 41:18-42:5 (thenew trial is to be a very simply change of Mr. Musikas exhibits to start from the correct date)If Samsungs understanding of the Courts order is incorrect, both sides damages experts shouldbe permitted to rely on exhibits discussed in reports but not presented to the jury.



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2198.51855/5494997.3-8-



DATED: August 30, 2013 QUINN EMANUEL URQUHART &SULLIVAN, LLP

By /s/ Victoria F. Maroulis

Charles K. VerhoevenKevin P.B. JohnsonVictoria F. MaroulisWilliam C. PriceMichael T. Zeller

Attorneys for SAMSUNG ELECTRONICSCO., LTD., SAMSUNG ELECTRONICSAMERICA, INC. and SAMSUNGTELECOMMUNICATIONS AMERICA LLC



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1

2198.51855/5494303.2 Case No. 11-cv-01846-LHK (PSG

BECHER DECLARATION ISO SAMSUNG'S MOTION TO STRIKE PORTIONS OF THE EXPERT REPORT OFJULIE L. DAVIS

QUINN EMANUEL URQUHART & SULLIVAN, LLPCharles K. Verhoeven (Bar No. 170151)[email protected] California Street, 22

ndFloor

San Francisco, California 94111Telephone: (415) 875-6600

Facsimile: (415) 875-6700

Kevin P.B. Johnson (Bar No. [email protected] F. Maroulis (Bar No. 202603)[email protected] Twin Dolphin Drive, 5

thFloor

Redwood Shores, California 94065-2139Telephone: (650) 801-5000Facsimile: (650) 801-5100

William C. Price (Bar No. 108542)[email protected]

Michael T. Zeller (Bar No. 196417)[email protected] S. Figueroa St., 10th FloorLos Angeles, California 90017Telephone: (213) 443-3000Facsimile: (213) 443-3100

Attorneys for SAMSUNG ELECTRONICS CO.,LTD., SAMSUNG ELECTRONICS AMERICA,INC. and SAMSUNGTELECOMMUNICATIONS AMERICA, LLC

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA, SAN JOSE DIVISION

APPLE INC., a California corporation,

Plaintiff,

vs.

SAMSUNG ELECTRONICS CO., LTD., aKorean business entity; SAMSUNG

ELECTRONICS AMERICA, INC., a NewYork corporation; SAMSUNGTELECOMMUNICATIONS AMERICA,LLC, a Delaware limited liability company,

Defendants.

CASE NO. 11-cv-01846-LHK (PSG)

DECLARATION OF ROBERT J.

BECHER IN SUPPORT OF SAMSUNGS

MOTION TO STRIKE PORTIONS OF

THE EXPERT REPORT OF JULIE L.

DAVIS

Case5:11-cv-01846-LHK Document2386-1 Filed08/30/13 Page1 of 4
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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2198.51855/5494303.2 -1- Case No. 11-cv-01846-LHK (PSG


I, Robert J. Becher, declare as follows:

1. I am a partner in the law firm of Quinn Emanuel Urquhart & Sullivan, LLP,counsel for Samsung Electronics Co., Ltd., Samsung Electronics America, Inc., and Samsung

Telecommunications America, LLC (collectively, Samsung). I submit this declaration in

support of Samsungs Motion to Strike Portions of the Expert Report of Julie L. Davis (Motion

to Strike). I have personal knowledge of the facts set forth in this declaration and, if called

upon as a witness, I could and would testify to such facts under oath.

2. Attached hereto as Exhibit 1 is a true and correct copy of the Expert Report ofJulie L. Davis, CPA (as of 8/23/2013) (Davis Report), including exhibits. The copy of the

Davis Report has been highlighted in yellow to show the material that Samsung is moving to

strike. The highlighting in Exhibit 32-S2 and Exhibit 33-S2 appears in the original and those

exhibits are not subject to Samsungs Motion to Strike.

3. Attached hereto as Exhibit 2 is a true and correct copy of the March 22, 2012Expert Report of Terry L. Musika, C.P.A., including exhibits.

4. Attached hereto as Exhibit 3 is a true and correct copy of the May 8, 2012Supplemental Expert Report of Terry L. Musika, C.P.A., including exhibits.

5. Attached hereto as Exhibit 4 is a true and correct copy of excerpts from theTranscript of Proceedings in this action, dated April 29, 2013.

6. Attached hereto as Exhibit 5 is a true and correct copy of excerpts from thedeposition transcript of Julie L. Davis, dated August 26, 2013.

7. Attached hereto as Exhibit 6 is a true and correct copy of excerpts from theTranscript of Proceedings in this action, dated August 21, 2013.

8. Attached hereto as Exhibit 7 is a redline comparison of the characterizations ofApple patents-in-suit offered in the Davis Report and the Musika Report.



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2198.51855/5494303.2 -2- Case No. 11-cv-01846-LHK (PSG


I declare under penalty of perjury under the laws of the United States of America that the

foregoing is true and correct.

Executed on August 30, 2013, at Los Angeles, California.

/s/ Robert J. Becher

Robert J. Becher



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2198.51855/5494303.2 -3- Case No. 11-cv-01846-LHK (PSG


GENERAL ORDER ATTESTATION

I, Victoria Maroulis, am the ECF user whose ID and password are being used to file the

foregoing document. I hereby attest pursuant to General Order 45.X.B. that concurrence in the

electronic filing of this document has been obtained from Robert J. Becher.

/s/ Victoria Maroulis



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EXHIBIT 1

FILED UNDER SEAL



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EXHIBIT 2

FILED UNDER SEAL



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EXHIBIT 3

FILED UNDER SEAL



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EXHIBIT 4



19/48

of 23 sheets Page 1 to 4 of 91 05/03/2013 12:52:5

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UNITED STATES COURT REPORTERS

1

UNI TED STATES DI STRI CT COURT

NORTHERN DI STRI CT OF CALI FORNI A

SAN J OSE DI VI SI ON

APPLE I NC. , A CALI FORNI ACORPORATI ON,

PLAI NTI FF,

VS.

SAMSUNG ELECTRONI CS CO. , LTD. ,

A KOREAN BUSI NESS ENTI TY;SAMSUNG ELECTRONICS AMERI CA,I NC. , A NEWYORK CORPORATI ON;SAMSUNG TELECOMMUNI CATI ONSAMERI CA, LLC, A DELAWARELI MI TED LI ABILI TY COMPANY,

DEFENDANTS.

))))))))

)))))))))))

C-11-01846 LHK

SAN J OSE, CALI FORNI A

APRI L 29, 2013

PAGES 1- 90

TRANSCRI PT OF PROCEEDI NGSBEFORE THE HONORABLE LUCY H. KOH

UNI TED STATES DI STRI CT JUDGE

APPEARANCES ON NEXT PAGE

OFFI CI AL COURT REPORTER: LEE- ANNE SHORTRI DGE, CSR, CRRCERTI FI CATE NUMBER 9595

PROCEEDI NGS RECORDED BY MECHANI CAL STENOGRAPHYTRANSCRI PT PRODUCED WI TH COMPUTER

2

1

A P P E A R A N C E S:2

FOR PLAINTIFF MORRISON & FOERSTER3

APPLE: BY: MICHAEL A. JACOBS

NATHANIEL B. SABRI4

425 MARKET STREET

SAN FRANCISCO, CALIFORNIA 941055

BY: ERIK J. OLSON6

755 PAGE MILL ROAD

PALO ALTO, CALIFORNIA 943047

8

FOR COUNTERCLAIMANT WILMER, CUTLER, PICKERING,

APPLE: HALE AND DORR9

BY: WILLIAM F. LEE

60 STATE STREET10

BOSTON, MASSACHUSETTS 02109

11

BY: MARK D. SELWYN

LAUREN FLETCHER12

950 PAGE MILL ROAD

PALO ALTO, CALIFORNIA 9430413

14

FOR THE DEFENDANT: QUINN, EMANUEL, URQUHART,15OLIVER & HEDGES

BY: WILLIAM C. PRICE16

MICHAEL T. ZELLER

SCOTT B. KIDMAN17

865 SOUTH FIGUEROA STREET

10TH FLOOR18

LOS ANGELES, CALIFORNIA 90017

19

BY: KATHLEEN M. SULLIVAN

51 MADISON AVENUE, 22ND FLOOR20

NEW YORK, NEW YORK 10022

21

BY: VICTORIA F. MAROULIS

555 TWIN DOLPHIN DRIVE22

SUITE 560

REDWOOD SHORES, CALIFORNIA 9406523

24

25


3

SAN JOSE, CALIFORNIA APRIL 29K, 20131

P R O C E E D I N G S2

(COURT CONVENED AND THE FOLLOWING PROCEEDINGS WERE HELD00:-01 3

THE CLERK: CALLING CASE NUMBER C-11-01846 LHK,00:-01 4

APPLE, INCORPORATED VERSUS SAMSUNG ELECTRONICS COMPANY LIMI00:-01 5

ET AL.00:-01 6

MR. JACOBS: MICHAEL JACOBS FROM MORRISON & FOERSTER00:-01 7

WITH ME ARE ERIC OLSON AND NATHAN SABRI FOR APPLE, YOUR HONOR00:-01 8

MR. LEE: GOOD AFTERNOON, YOUR HONOR. BILL LEE,00:-01 9

MARK SELWYN, AND LAUREN FLETCHER FROM WILMER, HALE FROM APPL00:-01 10

THE COURT: OKAY. I'M SORRY. I DIDN'T EVEN CATCH00:-01 11

THE PEOPLE WITH MR. JACOBS.00:-01 12

ERIC OLSON, YOU SAID, AND WHO ELSE?00:-01 13

MR. JACOBS: NATHAN SABRI, YOUR HONOR, S-A-B-R-I.00:-01 14

THE COURT: OKAY. THANK YOU.00:00 15

AND THEN MR. LEE, OKAY.00:00 16

MR. LEE: MARK SELWYN, YOUR HONOR.00:00 17

THE COURT: OKAY.00:00 18

MR. LEE: AND LAUREN FLETCHER, F-L-E-T-C-H-E-R.00:00 19

MR. PRICE: GOOD AFTERNOON, YOUR HONOR. BILL PRICE00:00 20

WITH QUINN, EMANUEL FOR SAMSUNG.00:00 21

AND WITH ME AT COUNSEL TABLE ARE KATHLEEN SULLIVAN,00:00 22

SCOTT KIDMAN, WHO PROBABLY WON'T BE SPEAKING, MICHAEL ZELLER00:00 23

AND VICTORIA MAROULIS.00:00 24

THE COURT: OKAY. GOOD AFTERNOON.00:00 25


4

MR. PRICE: GOOD AFTERNOON.00:00 1

THE COURT: OKAY. I HAVE A FEW QUESTIONS, BUT I'M00:00 2

OTHERWISE READY TO RULE ON EVERYTHING.00:00 3

LET ME JUST ASK THE FEW QUESTIONS FIRST. SO WHEN IS THE00:00 4

PTO LIKELY TO ISSUE A RE-EXAM CERTIFICATE FOR THE '381 AND THE00:00 5

'915 PATENTS?00:00 6

MR. JACOBS: BY ISSUING A RE-EXAMINATION CERTIFICATE,00:00 7

YOUR HONOR, I THINK YOUR HONOR IS ASKING WHEN IS THIS GOING T00:00 8

BE OVER.00:00 9

THE COURT: AS FAR AS THE PTO.00:00 10

MR. JACOBS: AS FAR AS THE PTO.00:00 11

THE COURT: I DON'T CARE ABOUT THE APPEALS BOARD. I00:00 12

DON'T CARE ABOUT THE APPELLATE CIRCUIT. WHEN IS THE PTO GOING00:00 13

TO BE OVER?00:00 14

MR. JACOBS: THE PTO'S ROLE -- LET ME CHECK AND MAKE00:00 15

SURE I HAVE THE RIGHT ANSWER. I BELIEVE THE ANSWER IS NOT TOO00:00 16

FAR AWAY, BUT SUBJECT TO THOSE APPEALS, ET CETERA.00:00 17

THE COURT: SO MARCH 29TH, 2013 IS WHEN THE PTO00:00 18

ISSUED THE FINAL OFFICE ACTION IN THE '381?00:00 19

MR. JACOBS: YES.00:00 20

THE COURT: AND WHAT IS IT THAT YOU ARE FILING ON00:00 21

MAY 29TH OF 2013?00:00 22

MR. JACOBS: MAY I HAVE A MOMENT, YOUR HONOR?00:00 23

MS. MAROULIS: I'M SORRY, YOUR HONOR. IS THE00:00 24

QUESTION WHAT IS BEING FILED ON MAY 29TH?00:00 25




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57

AND I DON'T CARE IF THEY DON'T ARGUE IT, THE JURY IS VERY01:10 1

LIKELY TO THINK, "OH, WOW, AN ECONOMIST. I MEAN, THAT'S A01:10 2

SIGNIFICANT POSITION. I MEAN, I'VE GOT A C.P.A. WHO DOES MY01:10 3

TAXES."01:11 4

SO THIS IS REALLY TRYING TO CHANGE, YOU KNOW, THE NATURE OF01:11 5

THIS TRIAL ON DAMAGES.01:11 6

THE COURT: IF APPLE GETS A NEW EXPERT, I'LL ALLOW01:11 7

SAMSUNG TO GET A NEW EXPERT ON DAMAGES.01:11 8

MR. PRICE: AND BECAUSE OF THE EXPERTISE, WE WOULD01:11 9PROBABLY NEED DISCOVERY. SO ONE THING WE MIGHT DO IS WAIT01:11 10

UNTIL WE FIND OUT EXACTLY WHAT APPLE IS UP TO HERE, WHAT'S IN01:11 11

THEIR REPORT, WHO'S THE EXPERT, YOU KNOW, HOW IS THIS GOING TO01:11 12

CHANGE?01:11 13

THE COURT: YOU KNOW WHAT? YOU KNOW WHAT? I THINK01:11 14

YOU ALL DON'T UNDERSTAND HOW CLOSE YOU ARE NOT TO GETTING A01:11 15

TRIAL. OKAY?01:11 16

DO YOU KNOW HOW MANY TRIALS I'LL HAVE IN APPLE'S CASES NEXT01:11 17

YEAR? SHOULD I JUST REMIND YOU? SO WE HAVE APPLE II MARCH 3101:11 18

THROUGH APRIL 25; I HAVE THE IN RE: HIGH TECH TRIAL IN WHICH01:11 19

APPLE IS ONE OF THE SEVEN DEFENDANTS, THAT'S SET FOR TRIAL01:11 20

MAY 27TH THROUGH JULY 17TH; THE MDL PRIVACY CASE AGAINST APPLE01:11 21

IS AUGUST 4TH THROUGH AUGUST 18TH OF 2014.01:11 22

OKAY? SO YOU HAVE GOTTEN A LOT OF DUE PROCESS IN THIS01:11 23

COURT. I'M ASKING YOU TO KEEP IT NARROW, NO NEW THEORIES, NO01:12 24

NEW CALCULATIONS.01:12 25


58

BUT YOUR SAYING, "NO, NOW WE'RE GOING TO REDO THE COSTS01:12 1

WHICH THEY DIDN'T DO REALLY DURING THE LAST TRIAL" IS ALREADY01:12 2

SIGNALLING TO ME WHAT IS GOING TO HAPPEN.01:12 3

SO I WAS GOING TO GIVE YOU A TRIAL DATE TODAY, BUT NOW I'M01:12 4

NOT GOING TO.01:12 5

MR. JACOBS: YOUR HONOR, WE --01:12 6

THE COURT: WE CAN SET THIS FOR A FURTHER CMC AFTER01:12 7

YOU DISCLOSE YOUR EXPERT AND THEN I'LL DECIDE AT THAT POINT01:12 8

WHETHER I WANT TO TRY THIS CASE AND WHEN. OKAY? THAT IS01:12 9

WITHIN MY DISCRETION. OKAY?01:12 10

SO WHEN SHOULD WE COME BACK FOR A CMC? I'M NOT GOING TO01:12 11

GIVE YOU A TRIAL DATE TODAY.01:12 12

MR. JACOBS: YOUR HONOR, WE NEED -- I'M SORRY.01:12 13

WE'RE -- I REALLY AM TRYING TO MEET THE COURT'S OBJECTIVES01:12 14

HERE.01:12 15

THE POINT OF RETAINING SOME FLEXIBILITY ON WHO WOULD01:12 16

TESTIFY WAS TO MAKE SURE OUR EXPERT WOULD BE AVAILABLE WHEN WE01:12 17

HAVE A TRIAL DATE, SO THERE IS A KIND OF -- THERE IS,01:12 18

REGRETTABLY, A CART BEFORE THE HORSE PROBLEM HERE.01:12 19

THE COURT: OKAY. BUT WHAT YOU SAID ABOUT COSTS,01:12 20

THAT IS A NEW ISSUE.01:13 21

MR. JACOBS: NO, COST IS NOT -- NO, DEDUCTIBLE01:13 22

EXPENSE IS NOT A NEW ISSUE AT ALL. MR. MUSIKA --01:13 23

THE COURT: OKAY. THEN WHY DO YOU HAVE TO REDO01:13 24

EXPENSES? THE ONLY THING THAT WAS INCORRECT WAS THE NOTICE01:13 25


59

DATE. THAT HAS NOTHING TO DO WITH EXPENSES OF APPLE. SO --01:13 1

MR. JACOBS: NO, NO, NOT APPLE EXPENSES.01:13 2

THE COURT: SO WHY DOES THAT HAVE TO BE REDONE?01:13 3

MR. JACOBS: SORRY. NOT APPLE EXPENSES, YOUR HONOR.01:13 4

I'M SORRY I WASN'T CLEAR.01:13 5

THE COURT: WHAT?01:13 6

MR. JACOBS: YOUR HONOR, IGNORE -- FORGET THIS. WE01:13 7

WILL HAVE A SINGLE --01:13 8

THE COURT: EXPENSES OF WHAT?01:13 9MR. JACOBS: OF SAMSUNG'S DEDUCTIBLE -- RECALL THAT A01:13 10

MAJOR ISSUE AT TRIAL FOR INFRINGER'S PROFITS WAS WHETHER WHAT01:13 11

SAMSUNG HAD CATEGORIZED AS GNA KINDS OF EXPENSES WAS, IN FAC01:13 12

DIRECTLY ATTRIBUTABLE TO THE SPECIFIC PRODUCTS. AND THAT'S01:13 13

WHAT THE INSTRUCTION SAYS. IT SAYS DIRECTLY ATTRIBUTABLE.01:13 14

IN THE NEW TRIAL, BOTH SIDES WILL BE ARGUING THAT ISSUE01:13 15

AGAIN TO THE JURY. WE HAVE TO ARGUE THAT ISSUE TO THE JURY.01:13 16

WE CAN'T NOT ARGUE THAT ISSUE TO THE JURY.01:13 17

AND OUR WITNESS WILL SAY THAT WHAT SAMSUNG IS PRESENTING01:13 18

THE JURY AS DEDUCTIBLE EXPENSES ARE, IN FACT, NOT DIRECTLY01:13 19

ATTRIBUTABLE.01:14 20

THE COURT: BUT WHAT DOES THAT HAVE TO DO WITH THE01:14 21

NOTICE DATE? THAT IS THE PIECE THAT I'M MISSING.01:14 22

MR. PRICE: THAT HAS NOTHING TO DO WITH THE NOTICE01:14 23

DATE.01:14 24

THIS HAS TO DO WITH WHAT THE INFRINGER'S PROFITS ARE.01:14 25


60

I MEAN, THERE WAS A HUGE DIFFERENCE IN NUMBERS BETWEEN01:14 1

THEIR EXPERT AND OURS BECAUSE MR. WAGNER DEDUCTED COSTS.01:14 2

AND NOW WE'RE HEARING THAT THEY'RE GOING TO, YOU KNOW, HA01:14 3

TWO EXPERTS.01:14 4

THE COURT: GET A DO-OVER.01:14 5

MR. JACOBS: WE'LL HAVE A SINGLE EXPERT.01:14 6

THE COURT: YOU'LL GET A DO-OVER ON EXPENSES. I01:14 7

UNDERSTAND.01:14 8

FORGET IT THEN. NO TRIAL DATE. WE'LL SET ANOTHER CMC.01:14 9

I'M TRYING TO CONVEY HOW SERIOUS I AM THAT THIS NEEDS --01:14 10

I'M NOT GOING TO LET YOU GET A DO-OVER. YOU ARE NOT GOING TO01:14 11

BE ABLE TO RAISE NEW THEORIES IN THIS CASE.01:14 12

MR. JACOBS: IT'S NOT A NEW THEORY, YOUR HONOR. IT'S01:14 13

RIGHT IN MR. MUSIKA'S REPORT.01:14 14

THE COURT: WHAT IS THE DIFFERENCE OF A CORRECTED01:14 15

NOTICE DATE ON EXPENSES? YOU HAVE NOT BEEN ABLE TO ARTICULAT01:14 16

WHAT IS THE CONNECTION THERE. HOW DOES A NOTICE DATE OF01:14 17

APRIL 15TH AFFECT THE EXPENSE?01:14 18

MR. JACOBS: WHAT I THINK -- LET ME -- WE'VE THOUGHT01:15 19

ABOUT THIS, YOUR HONOR, AND IF YOU JUST GIVE ME A MINUTE HERE,01:15 20

I THINK I CAN INTERPRET IN OUR LEGAL FRAMEWORK WHAT THE COURT01:15 21

IS SAYING.01:15 22

WHAT THE COURT IS SAYING IS THE JURY -- THE COURT BELIEVES01:15 23

THAT THE JURY MADE A FINDING ON DEDUCTIBLE EXPENSES AND AWAR01:15 24

US A PERCENTAGE OF OUR SOUGHT AFTER LOST PROFITS.01:15 25




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61

AND WHAT THE COURT IS, IN ESSENCE, PROPOSING IS THAT WE01:15 1

HAVE A NEW TRIAL LIMITED TO THE REVERSE ENGINEERING OF THE01:15 2

PRIOR JURY VERDICT AS IT RELATES TO DEDUCTIBLE EXPENSES.01:15 3

THE COURT WOULD BE, IN EFFECT, TAKING THE REVERSE01:15 4

ENGINEERING AND MAKING IT, THAT PERCENTAGE, A KIND OF A LAW OF01:15 5

THE CASE.01:15 6

THE COURT: NO, NO, NO. I'M ASKING YOU TO EXPLAIN,01:15 7

WHAT IS THE RELATION BETWEEN A NEW NOTICE DATE TO EXPENSES?01:15 8

MR. JACOBS: THERE IS NO --01:15 9THE COURT: WHAT IS THAT RELATIONSHIP? WHY DOES A01:15 10

NEW NOTICE DATE NECESSITATE A NEW ANALYSIS AND A NEW01:15 11

CALCULATION ON EXPENSES? THAT'S WHAT I DON'T UNDERSTAND.01:15 12

MR. JACOBS: BECAUSE THE ONLY WAY YOU COULD NOT DO01:15 13

THAT IS TO ACCEPT SOME PRIOR ADJUDICATION OF WHAT THE PROPER01:15 14

DEDUCTIBLE EXPENSES WERE, AND THE COURT ACCEPTED SAMSUNG'S01:16 15

ARGUMENT ON THIS POINT FOR PURPOSES OF DECIDING WHETHER THE01:16 16

JURY'S AWARD WAS EXCESSIVE.01:16 17

BUT TO NOW TURN THAT REVERSE ENGINEERING INTO A RESTRICTION01:16 18

IN THE NEW DAMAGES TRIAL IS TO TAKE THAT REVERSE ENGINEERING01:16 19

WAY, WAY, WAY TOO FAR.01:16 20

THERE'S NO RELATIONSHIP, AS SUCH, BETWEEN THE NEW NOTICE01:16 21

DATE --01:16 22

THE COURT: I GUESS I DON'T UNDERSTAND. WHY DO YOU01:16 23

HAVE TO GIVE NEW CALCULATIONS ON EXPENSES?01:16 24

MR. JACOBS: WE WILL NOT GIVE NEW CALCULATIONS ON01:16 25


62

EXPENSES.01:16 1

WE WILL SIMPLY ARGUE THAT -- OUR DAMAGES EXPERT WILL ARGUE01:16 2

THAT SAMSUNG'S ASSIGNMENT IS INCORRECT, JUST AS IT DID IN THE01:16 3

FIRST TRIAL.01:16 4

THE COURT: THAT'S NOT WHAT YOU SAID. YOU SAID YOU01:16 5

NEED TO GET SOMEONE TO SUPPLEMENT DR. VELLTURO FROM INVOTEX --01:16 6

MR. JACOBS: YES.01:16 7

THE COURT: -- TO REDO THE CALCULATION EXPENSES.01:16 8

MR. JACOBS: NO. I'M SORRY. IF I SAID THAT, I01:16 9

MISSPOKE.01:16 10

WE'RE NOT GOING TO REDO THE CALCULATIONS. IT'S THE SAME01:16 11

CALCULATION OF DEDUCTIBLE EXPENSES.01:16 12

AND WE'LL HAVE A SINGLE EXPERT, YOUR HONOR. WE WILL NOT GO01:17 13

WITH TWO EXPERTS. WE'LL FIGURE OUT HOW TO HANDLE THAT01:17 14

DEDUCTIBLE EXPENSE ISSUE WITHOUT HAVING AN ADDITIONAL EXPERT.01:17 15

MR. PRICE: AND THEN THE QUESTION IS, IS THAT01:17 16

ADDITIONAL EXPERT GOING TO BE AN ECONOMIST SO THEY CAN NOW PUT01:17 17

AN ECONOMIST BEFORE THE JURY AND TRUMP US ON QUALIFICATIONS?01:17 18

OR IS IT GOING TO BE WHAT IT WAS BEFORE, WHICH IS A C.P.A.?01:17 19

THE COURT: IT NEEDS TO BE A C.P.A. OTHERWISE IF01:17 20

THEY GET AN ECONOMIST, YOU'LL GET AN ECONOMIST, IT'LL REOPEN01:17 21

DISCOVERY AND I WILL NOT SET THIS TRIAL. I WON'T SET THE TRIAL01:17 22

DATE.01:17 23

I MEAN, NOT EVERY JUDGE TRIES A CASE IN 14 MONTHS LIKE I01:17 24

DID THE FIRST ONE. I AM NOT GOING TO GIVE YOU A TRIAL DATE.01:17 25


63

IF YOU ARE UNREASONABLE AND TAKE NO CONSIDERATION OF THE01:17 1

COURT'S RESOURCES, THEN YOU DESERVE TO HAVE THAT KIND OF --01:17 2

MR. JACOBS: WE ARE --01:17 3

THE COURT: -- THAT KIND OF TRIAL DATE WHICH IS GOING01:17 4

TO BE MUCH, MUCH LATER.01:17 5

I ALREADY TOLD YOU, I WILL BE IN TRIAL ON APPLE CASES FOR01:17 6

ABOUT SIX, SEVEN MONTHS NEXT YEAR. OKAY?01:17 7

SO IF YOU'RE ASKING ME TO GIVE YOU YET ONE MORE TRIAL, THEN01:17 8

I'M ASKING YOU TO KEEP THIS VERY LIMITED AND NARROW. NO NEW01:17 9THEORIES. NO NEW NUMBERS. NO NEW PRODUCTS. NO NEW METHOD01:18 10

KEEP THIS NARROW SO THAT WE CAN LIMIT THIS SO THAT WE'RE01:18 11

NOT REOPENING AND HAVING THE SAME NIGHTMARE WE'VE HAD01:18 12

PREVIOUSLY.01:18 13

MR. JACOBS: WE WILL STIPULATE THAT THE -- WE -- IF01:18 14

ALL OF US AGREE, WE CAN QUALIFY MR. VELLTURO AS AN ACCOUNTANT01:18 15

EVEN THOUGH HE ISN'T.01:18 16

I MEAN, IF THAT'S REALLY SAMSUNG'S WORRY, SAMSUNG COULD01:18 17

SIMPLY STIPULATE TO HIS QUALIFICATIONS AND WE WON'T UTTER THE01:18 18

WORD THAT HE'S AN ECONOMIST IF THAT'S WHAT THIS IS ALL ABOUT.01:18 19

MR. PRICE: HERE'S --01:18 20

MR. JACOBS: IF THEY WILL STIPULATE THAT HE'S01:18 21

QUALIFIED TO TESTIFY, WE'LL GO THROUGH HIS CREDENTIALS WITHOUT01:18 22

MENTIONING THAT HE'S A PH.D. ECONOMIST OR WHATEVER HE IS.01:18 23

MR. PRICE: THAT'S THE FUNNY THING. HE'S NOT01:18 24

QUALIFIED TO GIVE THE OPINION THEY WANT HIM TO GIVE.01:18 25


64

MR. JACOBS: NOW THAT'S A DIFFERENT --01:18 1

MR. PRICE: IF THE FIRST TRIAL, IT WAS AN OPINION BY01:18 2

A C.P.A. ABOUT WHAT DEDUCTIBLE COSTS WERE, HUGE ISSUE, HOW TO01:18 3

GET THESE THINGS, AND MR. JACOBS JUST SAID, "WE NEED TO BRING01:18 4

IN AN ACCOUNTANT TO SUPPLEMENT VELLTURO BECAUSE VELLTURO IS 01:19 5

QUALIFIED" --01:19 6

THE COURT: OKAY. I'M SORRY.01:19 7

YOU HAVE YOUR CLIENT HERE. ASK IF YOU'RE GOING TO INSIST01:19 8

ON AN ECONOMIST, OKAY?01:19 9

IF YOU INSIST ON AN ECONOMIST, THEN I'M GOING TO GIVE01:19 10

SAMSUNG THE OPPORTUNITY TO SELECT AN ECONOMIST AND WE WILL01:19 11

REOPEN DISCOVERY. OKAY?01:19 12

MR. JACOBS: GIVE ME A MINUTE, YOUR HONOR.01:19 13

THE COURT: GO AHEAD.01:19 14

(PAUSE IN PROCEEDINGS.)01:19 15

MR. JACOBS: AGREED, YOUR HONOR. OUR SUBSTITUTE01:19 16

EXPERT FOR TERRY MUSIKA WILL BE A C.P.A.01:19 17

THE COURT: OKAY. NOW, MR. PRICE, WHAT'S YOUR01:19 18

RESPONSE TO THAT?01:19 19

MR. PRICE: WELL, I GUESS THE RESPONSE IS WE --01:19 20

WHOOPS, SORRY. -- IS THAT WE NEED TO KNOW WHO, WE NEED TO KN01:19 21

WHAT THEIR OPINION IS GOING TO BE AND, YOU KNOW, WHETHER --01:20 22

IT'S AMAZING WE'RE HERE AND WE DON'T KNOW WHO. I DON'T01:20 23

UNDERSTAND WHY WE'RE HERE AND WE DON'T KNOW WHO.01:20 24

MR. JACOBS: WE TOLD THEM AMONG WHOM IT COULD BE,01:20 25




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65

YOUR HONOR. I THINK THIS HAS NOW TURNED INTO A GRAVER ISSUE.01:20 1

THE COURT: WELL, I HAVEN'T HEARD. I'VE HEARD01:20 2

DR. VELLTURO AND MAYBE SOMEBODY FROM INVOTEX.01:20 3

MR. JACOBS: WELL, NOW WE'RE GOING TO FIND A C.P.A.,01:20 4

YOUR HONOR, BECAUSE -- AND THE BEST C.P.A., THE MOST EFFECTIVE01:20 5

TRIAL WITNESS THAT CAN TESTIFY ON THE DATE THAT YOU SET FOR A01:20 6

NEW TRIAL, THAT'S WHAT WE'RE GOING TO GO OUT AND FIND, AND WHO01:20 7

CAN ADOPT MR. MUSIKA'S REPORT WITH VARIATIONS ONLY -- AS01:20 8

LIMITED --01:20 9THE COURT: CAREFUL.01:20 10

MR. JACOBS: AS LIMITED VARIATIONS AS POSSIBLE.01:20 11

THE COURT: I'M NOT GOING TO ALLOW ANY VARIATIONS01:20 12

OTHER THAN THE NOTICE DATE. I'M NOT GOING TO ALLOW ANY OTHER01:20 13

VARIATIONS OTHER THAN THE NOTICE DATE. I -- IS THAT CLEAR?01:20 14

MR. JACOBS: THAT SOUNDS LIKE A RULING. WE'LL TAKE01:20 15

IT AS A RULING.01:20 16

THE COURT: THAT IS A RULING.01:20 17

MR. JACOBS: WE'LL TAKE IT AS SUCH.01:20 18

THE COURT: THERE ARE NO VARIATIONS OTHER THAN THE01:20 19

NOTICE DATE. THIS IS JUST REDOING THE LAST TRIAL ON THIS ONE01:21 20

LIMITED ISSUE.01:21 21

MS. MAROULIS: YOUR HONOR, THERE ARE SOME ISSUES THAT01:21 22

WILL COME UP REGARDLESS OF WHAT THE REPORT LOOKS LIKE, AND AT01:21 23

LEAST TWO OF THEM ARE THIS:01:21 24

A NEW PERSON MIGHT BE SUBJECT TO DAUBERT CHALLENGE FOR01:21 25


66

THEIR QUALIFICATIONS, THAT'S ONE.01:21 1

THE SECOND ONE WE FLAGGED IN OUR PAPERS, WHICH IS THE01:21 2

PRODUCTS THAT YOUR HONOR ENTERED THE FINAL ORDER ON, THOSE ARE01:21 3

THE LOST PROFITS THEORIES. THEY ACTUALLY KNOW -- THE JURY01:21 4

WOULD KNOW LOST PROFITS FOR THE PRODUCTS THAT ARE GOING TO NEW01:21 5

TRIAL POTENTIALLY, SO WE SHOULD BE ABLE TO BRIEF THAT AND01:21 6

EXPLAIN WHY APPLE MAY OR MAY NOT BRING THAT THEORY FORWARD.01:21 7

SO WHEN YOUR HONOR SAYS WE'LL BE LIMITED TO EVERYTHING LIKE01:21 8

IN THE OLD CASE, WE WANT TO MAKE SURE IT'S CLEAR THAT THE01:21 9

MOTION PRACTICE MIGHT BE DIFFERENT AND THERE WILL BE MOTIONS01:21 10

COMING FORWARD, EVEN IF THE REPORT IS VERY SIMILARLY HUED TO01:21 11

THE OLD REPORT.01:21 12

MR. JACOBS: YOUR HONOR, THIS IS --01:21 13

THE COURT: WAIT. CAN I -- CAN YOU -- I'M SORRY. I01:21 14

DIDN'T UNDERSTAND WHAT YOU WERE SAYING ABOUT THE AVAILABLE01:21 15

REMEDIES.01:22 16

MS. MAROULIS: YOUR HONOR, THE JURY REJECTED THE01:22 17

FINDING OF LOST PROFITS AS TO THE PRODUCTS THAT YOUR HONOR01:22 18

DESIGNATED FOR A NEW TRIAL.01:22 19

SO SAMSUNG SHOULD BE ABLE TO SEEK EXCLUSION OF LOST PROFITS01:22 20

THEORIES IF WE SEE IT IN THE NEW REPORT, BECAUSE WE DON'T KNOW01:22 21

WHAT WE'LL SEE IN APPLE'S EXPERT REPORT.01:22 22

MR. JACOBS: THAT'S AN INFERENCE, YOUR HONOR.01:22 23

IT'S -- THIS IS BACK TO THE POINT ABOUT HOW MUCH WE TAKE01:22 24

THIS REVERSE ENGINEERING OF THE VERDICT AND TURN IT INTO LAW OF01:22 25


67

THE CASE. WE BELIEVE THAT WOULD BE LEGAL ERROR.01:22 1

IT'S ONE THING TO LOOK AT -- WE DISAGREE WITH THE REVERSE01:22 2

ENGINEERING THAT WAS DONE, BUT IT'S ONE THING TO DO THAT AND01:22 3

AWARD A NEW TRIAL.01:22 4

IT'S ANOTHER THING TO SAY, "WELL, I LOOK AT THIS JURY AND01:22 5

THE JURY COULDN'T POSSIBLY HAVE AWARDED LOST PROFITS BASED O01:22 6

THIS NUMBER; THEREFORE, APPLE IS PRECLUDED FROM SEEKING LOST01:22 7

PROFITS IN THE NEW TRIAL."01:22 8

THE COURT: WELL, I AGREE WITH THAT. WE'RE REDOING01:22 9LAST YEAR'S TRIAL.01:22 10

THAT DOESN'T MEAN THAT A THEORY THAT WAS PRESENTED TO LAS01:22 11

YEAR'S JURY CANNOT BE PRESENTED IN A NEW TRIAL. SO THAT01:22 12

REQUEST IS GOING TO BE DENIED.01:23 13

MS. MAROULIS: YOUR HONOR, THE PRIOR JURY REJECTED01:23 14

THAT, THE LOST PROFITS AS TO THESE SET OF PRODUCTS.01:23 15

THE COURT: I HEAR YOU, AND THE NEXT JURY MAY, TOO.01:23 16

BUT I'M JUST SAYING, I'M GOING TO ALLOW -- WHATEVER01:23 17

THEORIES EITHER SIDE PRESENTED TO THE LAST JURY CAN BE01:23 18

PRESENTED TO THIS JURY.01:23 19

YOU CAN -- YOU CAN PRESENT LESS IF YOU WANT TO, BUT YOU01:23 20

CANNOT PRESENT MORE. OKAY?01:23 21

WHAT -- I UNDERSTAND ON DAUBERT ON QUALIFICATIONS. I01:23 22

WOULD --01:23 23

MR. JACOBS: IT'S NOT REALLY DAUBERT, YOUR HONOR.01:23 24

IT'S A -- DAUBERT IS METHODOLOGY AND I THINK WE'VE PASSED ALL01:23 25


68

THE METHODLOGICAL CHALLENGES.01:23 1

I THINK THAT'S ONE OF THE BENEFITS THAT WE'RE ACCRUING FROM01:23 2

YOUR HONOR'S DIRECTION TO US IS WE WILL NOT HAVE DAUBERTS01:23 3

BECAUSE DAUBERTS WERE DONE, AND DONE TO A FARE-THEE-WELL, LA01:23 4

YEAR.01:23 5

IF THEY WANT TO CHALLENGE -- HAVING COERCED US INTO A01:23 6

C.P.A. AND NOW SAYING, "OH, THE C.P.A. IS NOT QUALIFIED," FINE.01:23 7

THE COURT: ALL RIGHT. WELL, WHAT ABOUT A -- THIS IS01:23 8

WHAT I WAS GOING TO SUGGEST: HAVE APPLE'S EXPERT -- IDENTIFY01:23 9

ITS NEW C.P.A. EXPERT, ONE PERSON, BY MAY 13TH.01:24 10

MR. JACOBS: OKAY.01:24 11

THE COURT: OKAY? APPLE SUBMIT -- I DON'T EVEN KNOW01:24 12

IF YOU WOULD REALLY NEED ALL THESE DATES, OR ALL THIS TIME, BUT01:24 13

I GUESS BECAUSE YOU'RE GETTING A NEW PERSON UP TO SPEED -- JUN01:24 14

24TH, WHICH IS I THINK THE DATE YOU REQUESTED.01:24 15

MR. JACOBS: IT'S TWO DAYS BEFORE, BUT THAT'S FINE,01:24 16

YOUR HONOR.01:24 17

THE COURT: OKAY. SAMSUNG'S REPORT, JULY 26TH. YOU01:24 18

REQUESTED, I THINK, 30 DAYS.01:24 19

EXPERT DEPOSITIONS CONCLUDED BY AUGUST 7TH.01:24 20

DOES THAT GIVE YOU ENOUGH TIME OR IS THAT TOO TIGHT?01:24 21

MS. MAROULIS: THAT MIGHT BE TOO TIGHT, YOUR HONOR,01:24 22

BECAUSE WE'LL ALSO HAVE EXPERT DISCOVERY IN THE FOLLOW-ON CAS01:24 23

THE COURT: OH, OKAY. WHAT ABOUT AUGUST 30TH?01:24 24

AUGUST 23RD?01:24 25




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69

MS. MAROULIS: AUGUST 30TH, YOUR HONOR.01:25 1

MR. JACOBS: I THINK THE 23RD IS PLENTY, YOUR HONOR.01:25 2

THAT IS NEARLY A MONTH FOR EXPERT DEPOSITIONS.01:25 3

THE COURT: OKAY. THEN I WAS GOING TO ALLOW ONLY01:25 4

SAMSUNG, NOT APPLE, ONE NO MORE THAN FOUR-PAGE, LET'S CALL IT A01:25 5

RULE 702 OBJECTION BASED ON QUALIFICATIONS ALONE.01:25 6

BECAUSE EVERYONE IS JUST GOING TO BE USING THE THEORIES01:25 7

THAT HAVE ALREADY GONE THROUGH EXTENSIVE MOTION PRACTICE LAST01:25 8

YEAR, THERE WILL BE NO NEW CHALLENGES TO THEORIES. OKAY?01:25 9BUT IF YOU WANT TO CHALLENGE APPLE'S EXPERT ON WHETHER HE01:25 10

OR SHE IS QUALIFIED TO GIVE THE OPINION, I THINK THAT IS01:25 11

LEGITIMATE. OKAY? SO FOUR PAGES AT MOST.01:25 12

MS. MAROULIS: THANK YOU, YOUR HONOR.01:25 13

AND WE HAVE TO RESERVE OUR RIGHT TO CHALLENGE IF THEY01:25 14

CHANGE THE REPORT SUBSTANTIALLY, WHICH THEY CLAIM RIGHT NOW01:25 15

THEY WON'T.01:25 16

THE COURT: OKAY. SO I WAS GOING TO SET A DATE FOR01:25 17

THAT AS WELL.01:25 18

NOW, I'M GOING TO SET A HEARING DATE. I WOULD LEAVE IT TO01:26 19

THE PARTIES TO SET A BRIEFING SCHEDULE, ALTHOUGH I WANT FINAL01:26 20

BRIEFS THREE WEEKS IN ADVANCE OF THE HEARING DATE.01:26 21

BUT OCTOBER 10TH OF 2013 I WOULD HEAR THE ONE SAMSUNG01:26 22

MOTION CHALLENGING THE QUALIFICATION SOLELY OF APPLE'S NEW01:26 23

EXPERT AND ANY MOTIONS TO STRIKE FROM EITHER EXPERT REPORT.01:26 24

NOW, LET'S PUT PAGE LIMITS ON THIS. AND I DON'T THINK I01:26 25


70

NEED -- I CERTAINLY DON'T THINK I NEED A REPLY ON THE 702.01:26 1

BUT WE'LL SAY THAT APPLE CAN FILE A FOUR-PAGE RESPONSE TO01:26 2

SAMSUNG'S FOUR-PAGE OBJECTION TO THE QUALIFICATIONS OF YOUR NEW01:26 3

EXPERT. NO REPLY ON THAT ONE.01:26 4

MR. JACOBS: OKAY. THANK YOU.01:26 5

THE COURT: NOW, MOTION TO STRIKE FROM EACH OTHER'S01:26 6

EXPERT REPORTS, I WOULD -- CAN WE LIMIT THAT TO TEN PAGES?01:26 7

MR. JACOBS: IS IT CLEAR, YOUR HONOR, THAT WE'RE01:27 8

NOT --01:27 9

THE COURT: THERE REALLY SHOULDN'T BE ANYTHING.01:27 10

MR. JACOBS: THERE SHOULDN'T BE ANYTHING.01:27 11

THE COURT: IF EVERYONE FOLLOWS MY RULING OF NO NEW01:27 12

THEORIES, NO NEW METHODOLOGIES, NO NEW DATA, NO NEW DAMAGES01:27 13

PERIOD, THERE REALLY SHOULDN'T BE.01:27 14

BUT I'M NOT TOTALLY OPTIMISTIC BASED ON MY EXPERIENCE WITH01:27 15

THIS CASE OVER THE LAST TWO YEARS.01:27 16

SO, I MEAN, I WOULD LIKE TO LIMIT THAT FURTHER, IF AT ALL01:27 17

POSSIBLE, IN TERMS OF PAGE LIMITS.01:27 18

AND I THINK A REPLY ACTUALLY MIGHT BE HELPFUL ON THAT01:27 19

SCORE.01:27 20

SO -- AND I ASSUME THAT THERE WILL PROBABLY BE01:27 21

CROSS-MOTIONS WOULD BE MY GUESS.01:27 22

MR. JACOBS: CAN IT BE CLEAR, YOUR HONOR, THAT THOSE01:27 23

MOTIONS LITERALLY ONLY GO TO THE -- TO ANY DIFFERENCES?01:27 24

THE COURT: YES, ANY DIFFERENCES FROM LAST TIME.01:27 25


71

MR. JACOBS: SO WE'RE -- TO STATE IT AGAIN, THE01:28 1

OBVERSE, WE ARE NOT GOING TO BE RELITIGATING MR. WAGNER'S OR01:28 2

MR. MUSIKA'S REPORTS.01:28 3

THE ONLY PROPER FOCUS OF ANY MOTIONS TO STRIKE WILL BE THE01:28 4

INCREMENT, THE CHANGE IN THE NEW REPORTS?01:28 5

THE COURT: YES.01:28 6

MR. JACOBS: OKAY.01:28 7

MS. MAROULIS: YOUR HONOR, IN TERMS OF PRESERVING THE01:28 8

RECORD FOR APPEAL --01:28 9THE COURT: YES.01:28 10

MS. MAROULIS: -- WE MIGHT NEED TO SIMPLY STATE OR01:28 11

RESTATE OUR PRIOR MOTIONS AND OBJECTIONS. WE'LL DOUBLE-CHECK01:28 12

THAT.01:28 13


MS. MAROULIS: BUT WE MIGHT HAVE TO, AT SOME POINT IN01:28 15

THE HEARING OR IN WRITING, SIMPLY SAY THAT WE'RE RESTATING THEM01:28 16

SO THAT THEY'RE NOT WAIVED, MUCH THE SAME WAY AS JURY01:28 17

INSTRUCTIONS, YOU HAVE TO REPEAT IT MULTIPLE TIMES.01:28 18

THE COURT: OKAY. THAT'S FINE.01:28 19

I'M HOPING THAT YOU MAY JUST BE ABLE TO, YOU KNOW, PER01:28 20

STIPULATION, BOTH PARTIES PRESERVE THE PREVIOUS OBJECTIONS THA01:28 21

THEY MADE TO METHODOLOGIES AND THEORIES AND CALCULATIONS OF 01:28 22

EXPERT, SOMETHING LIKE THAT.01:28 23

BUT, YES, I DON'T WANT TO RELITIGATE -- ANYTHING THAT'S01:28 24

ALREADY BEEN DECIDED AND HAS ALREADY SURVIVED A DAUBERT MOTIO01:28 25


72

OR A MOTION IN LIMINE WILL CONTINUE TO BE ADMISSIBLE AND PART01:29 1

OF THE CASE.01:29 2

SO LET'S SET LIMITS ON THAT IN TERMS OF PAGES. WHAT --01:29 3

MS. MAROULIS: TEN PAGES ON MOVING PAPERS, TEN PAGES01:29 4

ON OPPOSITION, AND SEVEN ON REPLY?01:29 5

THE COURT: WELL, I'M REALLY HOPING THAT IF -- IF MY01:29 6

RULING AS TO THE SCOPE OF THE NEW EXPERT REPORTS IS FOLLOWED,01:29 7

WE REALLY SHOULDN'T NEED --01:29 8

MR. JACOBS: SEVEN, SEVEN, FOUR, YOUR HONOR?01:29 9

THE COURT: YOU KNOW, WE SHOULDN'T NEED 54 PAGES OF01:29 10

BRIEFING ON THIS, RIGHT?01:29 11

MR. JACOBS: SEVEN, SEVEN, FOUR?01:29 12

THE COURT: SO YOU'RE NOT OPTIMISTIC, EITHER.01:29 13

MR. JACOBS: NO, I AM. I JUST -- I DON'T THINK THIS01:29 14

IS ABOUT PAGE LIMITS SO MUCH. I ACTUALLY THINK IT'S ABOUT01:29 15

SCOPE, AND IF THERE ARE NEW ISSUES THAT ARISE, THEY SHOULD BE01:29 16

VENTILATED.01:29 17

THE COURT: ARE YOU SATISFIED WITH THOSE LIMITS?01:29 18

MS. MAROULIS: THAT WOULD BE FINE, YOUR HONOR.01:29 19

THE COURT: SEVEN, SEVEN, FOUR?01:29 20

MS. MAROULIS: THAT WOULD BE FINE, YOUR HONOR.01:29 21

THE COURT: ALL RIGHT. SO SEVEN, SEVEN, FOUR.01:30 22

WORK OUT THE BRIEFING SCHEDULE. IF YOU NEED TO THEN MOVE01:30 23

UP THE EXPERT DEPOSITION DISCOVERY DEADLINE TO GET THE01:30 24

BRIEFING -- I WOULD LIKE, PLEASE, THREE WEEKS WITH THE REPLY01:30 25




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77

OCTOBER 24TH IS THE JUDGE'S MEETING. I DON'T KNOW ABOUT THE01:34 1

31ST.01:35 2

THE CLERK: OCTOBER 17TH IS THE DATE RESERVED FOR THE01:35 3

CLASS CERT MOTION ON I BELIEVE IT'S HERSKOWITZ AND JUEL.01:35 4

THE COURT: RIGHT. BUT I THINK THE SUGGESTION IS01:35 5

THAT DATE'S TOO EARLY.01:35 6

THE CLERK: OH, OKAY.01:35 7

THE COURT: SO IF YOU WOULD CHECK OCTOBER 31, PLEASE?01:35 8

THE CLERK: OCTOBER 31, IT'S THE DATE FOR THE CLASS01:35 9CERT IN THE IPHONE CASE.01:35 10

THE COURT: OH, YEAH. THAT'S NOT A GOOD DATE.01:35 11

THE CLERK: AND ALSO CLASS CERT IN BRAZIL VERSUS DOLE01:35 12

FOODS.01:35 13


THE CLERK: NOVEMBER 7TH IS THE DATE FOR APPLE'S01:35 15

SUMMARY JUDGMENT MOTION IN THE IPHONE CASE.01:35 16

THE COURT: UM-HUM.01:35 17

THE CLERK: AND A COUPLE CASES LAST DAY FOR01:35 18

DISPOSITIVE MOTIONS.01:35 19

THE COURT: AND WHICH ONES ARE THOSE, PLEASE?01:35 20

THE CLERK: OGDEN VERSUS BUMBLE BEE, A J & J, AND A01:35 21

JOHNSON VERSUS SAN BENITO COUNTY.01:36 22

THE COURT: OKAY. WHAT I WAS GOING TO SUGGEST AS01:36 23

A -- WHEN IS COLUMBUS DAY? THAT'S THE 11TH?01:36 24

THE CLERK: COLUMBUS DAY IS THE 14TH.01:36 25


78

THE COURT: NO, VETERAN'S DAY.01:36 1

THE CLERK: OH, VETERAN'S --01:36 2

THE COURT: WHAT I WAS GOING TO SUGGEST AS A TRIAL01:36 3

DATE WAS NOVEMBER 12, 13, 14, 15, AND 18, SO I WANTED TO HEAR01:36 4

YOUR PROPOSALS AS TO WHAT WOULD GO TO THE JURY FAIRLY SOON IN01:36 5

OCTOBER SO THAT YOU COULD PREPARE THAT FOR NOVEMBER.01:36 6

IF I MOVE THE 31ST HEARING TO THE 7TH, THEN I -- THAT COULD01:37 7

OPEN UP THE 31ST.01:37 8

BUT THEN THAT GIVES YOU LESS THAN TWO WEEKS. WOULD THAT BE01:37 9

ENOUGH TIME FOR YOU TO --01:37 10

(DISCUSSION OFF THE RECORD BETWEEN DEFENSE COUNSEL.)01:37 11

MS. MAROULIS: THAT SHOULD BE FINE, YOUR HONOR.01:37 12

THE COURT: WHICH ONE?01:37 13

MS. MAROULIS: THE 31ST IF THAT'S AVAILABLE.01:37 14

THE COURT: OKAY. DO YOU WANT TO BE HEARD ON THAT01:37 15

DATE?01:37 16

MR. JACOBS: THAT'LL BE FINE, YOUR HONOR.01:37 17

SHALL WE DECLARE THAT THE PRETRIAL CONFERENCE DATE, THEN,01:37 18

FOR THE TRIAL IN --01:37 19

THE COURT: WELL, I'M JUST WONDERING IF WE SHOULD --01:37 20

THE ONLY THING IS I DO HAVE -- WHAT WAS THAT? -- CLASS01:37 21

CERTIFICATION IN AN MDL ON OCTOBER 31, SO I WOULD HAVE TO BUMP01:37 22

THAT TO PUT THIS CASE ON THAT DATE.01:37 23

WHAT I'D LIKE TO DO -- COULD WE TRY TO KEEP IT ON THE 17TH01:38 24

AND THEN WHATEVER -- I MEAN, MY SENSE IS, FROM LAST TIME,01:38 25


79

BREAKING THINGS UP INTO SMALLER INCREMENTS IS A LITTLE BIT01:38 1

EASIER FOR THE COURT THAN HAVING BIG, MASSIVE HEARINGS. IT'S01:38 2

MORE DIFFICULT TO PREPARE FOR THEM AND WHATNOT.01:38 3

COULD WE TRY TO KEEP IT ON THE 10TH AND THE 17TH, AND THE01:38 4

IF THERE IS POTENTIALLY SPILL OVER, WE'D HAVE THE 31ST AS A01:38 5

POTENTIAL OVERFLOW DAY? WOULD THAT GIVE YOU ENOUGH TIME?01:38 6

MS. MAROULIS: THAT'S FINE, YOUR HONOR. IF THAT'S01:38 7

WHAT'S NEEDED FOR THE COURT, OF COURSE.01:38 8

THE COURT: OKAY. SO WHY DON'T WE KEEP THE 17TH ON?01:38 9I ALSO DON'T ANTICIPATE -- I WASN'T GOING TO EVEN SET ANY01:38 10

MOTIONS IN LIMINE BECAUSE I REALLY DON'T THINK THERE SHOULD B01:38 11

ANYTHING REALLY DIFFERENT. YOU'LL HAVE YOUR SAME WITNESSES01:39 12

FROM LAST TIME.01:39 13

OKAY. SO THE TRIAL WILL BE NOVEMBER 12, 13, 14, 15, 18.01:39 14

I WAS ANTICIPATING MAYBE OPENINGS OF 45 MINUTES EACH,01:39 15

CLOSINGS OF ONE HOUR EACH.01:39 16

I HAVEN'T DECIDED THE EVIDENCE TIME PERIOD. I THINK WE'LL01:39 17

HAVE TO FIGURE OUT IF THE '381 IS IN OR NOT. WE'LL HAVE TO01:39 18

MAKE THAT DECISION ONCE WE HAVE MORE SORT OF SENSE OF THE01:39 19

SCOPE.01:39 20

MS. MAROULIS: YOUR HONOR, MAY WE SUGGEST THAT WHE01:39 21

WE SUBMIT TO THE COURT THE PAPERS REGARDING '381, AND WE01:39 22

SUSPECT THE EXAMINER WILL NOT REOPEN ANYTHING, THAT THE PAR01:39 23

REVISIT WHAT YOUR HONOR SUGGESTED, WHICH IS STAYING THE '3801:39 24

AND STIPULATING POTENTIALLY TO THE REST TO OBVIATE THE TRIAL?01:39 25


80

WE WOULD LIKE AN OPPORTUNITY TO REAPPROACH THAT WITH BO01:39 1

THE COURT AND APPLE.01:39 2

THE COURT: OH, THAT'S FINE. THAT'S FINE.01:40 3

AND I DON'T HAVE TO SET ANY TIME PERIOD OR TIME LIMITATION01:40 4

NOW ON OPENING AND CLOSING AND EVIDENCE. WE CAN DECIDE TH01:40 5

LATER IF THE TRIAL DOES HAPPEN.01:40 6

BUT TENTATIVELY I WAS THINKING EIGHT JURORS WITH THREE01:40 7

PEREMPTORIES EACH, AND WE'LL HAVE TO GET A HUGE JURY POOL01:40 8

BECAUSE I THINK IT'LL BE MUCH MORE DIFFICULT TO FIND JURORS AT01:40 9

THIS STAGE.01:40 10

NOW, WITH REGARD TO YOUR MOTION, I WOULD SAY SET IT FOR A01:40 11

HEARING, BUT SINCE WE DON'T KNOW EXACTLY WHEN THE FINAL DAT01:40 12

WILL BE, I GUESS WHAT I WOULD ASK IS WHEN YOU DO GET FINAL W01:40 13

FROM THE PTO AS TO BOTH PATENTS, '915 AND '381, IF YOU WOULD01:40 14

CONTACT MS. PARKER BROWN, CC APPLE'S COUNSEL, AND WE'LL TRY 01:40 15

GET YOU A HEARING DATE IF A HEARING IS NECESSARY.01:40 16

I MAY JUST BE ABLE TO DECIDE IT ON THE PAPERS, BUT A01:41 17

HEARING DATE JUST GIVES ME A DATE BY WHICH I'VE GOT TO FOCUS 01:41 18

THIS PARTICULAR MOTION AND TRY TO GET IT RESOLVED.01:41 19

MS. MAROULIS: YES, YOUR HONOR, WE'LL DO THAT.01:41 20

THE COURT: OKAY. ALL RIGHT.01:41 21

MS. MAROULIS: YOUR HONOR, THERE'S ONE ISSUE THAT I01:41 22

WANTED TO REVISIT.01:41 23

I KNOW THE COURT SAID THERE WILL BE NO DO-OVERS OF VARIO01:41 24

KINDS, BUT WITH RESPECT TO THE DAMAGES PERIOD, LAST TIME01:41 25




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Page 110

1 of accept abl e subst i t ut es i s onl y rel evant

2 dur i ng t he damages per i od and more speci f i cal l y,

3 onl y r el evant dur i ng t he l ost pr of i t s per i od,4 and I j ust gave you when t hose per i ods st ar t .

5 Q. When di d you assume t hey st ar t ed? Di d 10: 58AM

6 you assume t hey st ar t ed on t he not i ce dat e, t he

7 avai l abi l i t y of noni nf r i ngement al t er nat i ves?

8 A. That ' s t he dat e upon whi ch I ' ve

9consi der ed t he avai l abi l i t y of such al t er nat i ves

10 and det ermi ned t hat t he desi gn- around per i od 10: 59AM

11 needs t o be consi dered i n order t o addr ess t hat

12 quest i on.

13 Q. How di d you come t o consi der t hat as

14 t he st ar t i ng poi nt ? Was i t gi ven t o you by

15

at t or neys? 10: 59AM16 A. As I ' ve expl ai ned i n my r epor t , I don' t

17 see how Samsung can desi gn ar ound a pat ent unt i l

18 i t ' s not i f i ed of i t s exi st ence and t he f act t hat

19 i t ' s i nf r i ngi ng. Because I know what t hose

20 not i ce dates are as det ermi ned by t he j udge, 10: 59AM

21

t hat woul d be t he f i r st dat e that Samsung coul d22 be assumed t o st ar t a desi gn- around.

23 Q. Do you bel i eve i t i s appr opr i at e t o

24 cal cul at e avai l abi l i t y of accept abl e

25 noni nf r i ngement al t er nat i ves at a di f f er ent dat e 11: 00AM



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1 about desi gn- ar ound, woul d you cr edi t t he

2 t est i mony by Samsung' s exper t s?

3 A. I woul d need t o r evi ew such i nf or mat i on4 and t al k t o peopl e who have t echni cal backgr ound

5 about what i t means. 11: 24AM

6 Q. Besi des speaki ng wi t h Mr . Lamar u, di d

7 you do anyt hi ng el se to ascer t ai n t he l engt h of

8 t he desi gn- ar ound f or t he ' 915 pat ent ?

9A. I t hi nk I ' ve al r eady descr i bed t hat I

10 t al ked t o Dr . Si ngh and I ' ve al so r evi ewed t he 11: 24AM

11 document s i n t hi s case.

12 Q. What document s di d you r evi ew?

13 A. The ones t hat come t o mi nd r el at ed t o

14 pot ent i al desi gn- ar ounds woul d be the one t hat I

15

descr i bed t o you ear l i er t hat was pr oduced by 11: 25AM16 Samsung t hat shows an 18- t o 24- mont h desi gn

17 per i od.

18 Q. Di d t hat document speak about ' 915

19 speci f i cal l y?

20 A. No, not t o my r ecol l ect i on. 11: 25AM

21

Q. I n your r epor t you assumed t hat Samsung22 woul d st ar t desi gni ng ar ound Appl e' s pat ent s

23 begi nni ng on t he l at est of t he dat es of i ssuance

24 of t he pat ent , t he dat e Samsung f i r st sol d t he

25 pr oduct , t hen i nf r i nged t he pat ent or t he dat e 11: 26AM



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1 when Samsung r ecei ved act ual not i ce; i s t hat

2 correct?

3 A. That i s cor r ect .4 Q. Okay. Why di d you choose t hese dat es?

5 A. Wel l , we' d have t o t ake t hem 11: 26AM

6 one- by- one. I can' t choose a dat e bef or e t he

7 dat e of not i ce because you can' t st ar t desi gni ng

8 ar ound a pat ent unt i l you know of i t s exi st ence

9and t he f act t hat you ar e i nf r i ngi ng. I can' t

10 st ar t desi gni ng ar ound a pat ent t hat hasn' t yet 11: 26AM

11 i ssued, and so t hose ar e t he t wo t hat I t hi nk

12 dr i ve t he cal cul at i on f or t he most par t .

13 Q. You got t he not i ce dat es f r om t he

14 Cour t ' s Mar ch 1, 2013, or der ; i s t hat r i ght ?

15

A. I di d. 11: 27AM16 Q. Okay. The dat es i dent i f i ed by t he

17 order ar e not t he dat es t hat Samsung act ual l y

18 l ear ned of t he pat ent s, ar e t hey?

19 A. I don' t know what you' r e t al ki ng about .

20 Q. Ar en' t t hese t he ear l i est dat es 11: 27AM

21

suppor t ed by t he t r i al evi dence i n whi ch Appl e22 pr ovi ded not i ce t o Samsung on t he pat ent s

23 pur suant t o t he st at ut e?

24 A. Say t hat agai n, t he ear l i est dat es t hat

25 Samsung. . . 11: 27AM



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1 dr i ves t he not i ce dat es i n t hi s case.

2 Q. You al so pr epar ed a set of cal cul at i ons

3 assumi ng t hat t he desi gn per i od woul d begi n on4 t he l at er of when t he rel evant pat ent i ssued or

5 t he dat e when Samsung f i r st sol d a pr oduct t hat 11: 29AM

6 i nf r i nged t he pat ent s at i ssue; i s t hat cor r ect ?

7 THE WI TNESS: I ' m goi ng t o have t o have

8 you r ead that one back, pl ease.

9( Recor d r ead. )

10 THE WI TNESS: I ' m not f ol l owi ng your 11: 29AM

11 quest i on. Do you have a par t i cul ar cal cul at i on

12 i n mi nd?

13 BY MS. MAROULI S:

14 Q. So you per f or med cal cul at i ons where

15

desi gn- ar ound per i od st ar t s at t he not i ce dat e, 11: 29AM16 correct?

17 A. I di d.

18 Q. Okay. You al so pr epar ed al t er nat i ve

19 cal cul at i ons wher e t hose desi gn- ar ound per i ods

20 st ar t on a di f f er ent dat e; i s t hat r i ght ? 11: 29AM

21

A. I have an al t er nat i ve cal cul at i on t hat22 shows t he desi gn- ar ound per i ods st ar t i ng as

23 Mr . Wagner al l eges pr i or t o t he not i ce dat es.

24 Q. Okay. Why di d you pr epare t hi s

25 al t er nat i ve set of cal cul at i ons? 11: 30AM



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Page 134

1 A. I expect ed Mr . Wagner t o make t hat

2 argument and want ed t o have avai l abl e t o t he

3 j udge, i f she needs i t , t he cal cul at i on t hat4 woul d show what t he r esul t woul d be i f you

5 st ar t ed wi t h t hat assumpt i on. 11: 30AM

6 Q. Do you bel i eve t hat cal cul at i on' s

7 appr opr i at e?

8 A. I don' t t hi nk so. I don' t t hi nk i t ' s

9l ogi cal t o assume t hat Samsung coul d st ar t

10 desi gni ng ar ound a pat ent t hat i t di dn' t yet 11: 30AM

11 have not i ce about .

12 Q. Okay. Do you agr ee t hat begi nni ng a

13 desi gn- around per i od on t hat dat e as opposed t o

14 your ot her cal cul at ed dat es decr eases your l ost

15

pr of i t s anal ysi s by 300 mi l l i on? 11: 31AM16 A. I can l ook i t up t o gi ve you t he exact

17 number , but I cer t ai nl y woul d agr ee wi t h you

18 t hat i t decreases t he t ot al damages number .

19 Q. I t decreases i t subst ant i al l y, cor r ect?

20 A. Yes, i t does. 11: 31AM

21

Q. Lost pr of i t s anal ysi s r equi r es22 r econst r uct i ng t he market as i t woul d have been

23 wi t hout t he i nf r i ngi ng pr oduct , cor r ect ?

24 A. I t does.

25 Q. Okay. Thi s i s cal l ed a "hypot het i cal 11: 31AM



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Page 274

1 t hi s case, because at t he t i me, he was l ooki ng

2 at a much br oader set of pr oduct t han j ust t he

3 seven t hat ar e remai ni ng i n t hi s case.4 Q. He di dn' t do a pr oduct - by- pr oduct

5 cal cul at i on, di d he? 03: 29PM

6 A. That ' s cor r ect . Ther e wer e t oo many

7 pr oduct s i nvol ved at t hat t i me.

8 Q. So i t ' s not s i mpl y t hat Mr . Musi ka

9di dn' t do t he i ncrement al pr of i t f or t he seven

10 pr oduct s at i ssue; he di dn' t do i t f or any of 03: 29PM

11 t he accused pr oduct s, cor r ect ?

12 A. I f you' r e t al ki ng about on a

13 pr oduct - by- pr oduct basi s, t hat ' s cor r ect . He

14 cl ear l y di d i t on an over al l basi s, by l ooki ng

15

at Exhi bi t 50 t o hi s r epor t . 03: 29PM16 Q. So you agr ee he di d not do i t on

17 pr oduct - by- pr oduct , cor r ect ?

18 A. He di d not show t he i ncr ement al pr of i t

19 mar gi n on any speci f i c pr oduct . He di d i t on

20 t he combi ned set of pr oduct s i nvol ved i n t he 03: 30PM

21

case at t hat t i me.22 Q. Okay. I n your repor t you st at e t hat

23 t he pr oper basi s i s t o cal cul at e gr oss pr of i t s.

24 I f t hat i s t he case, why do you al so

25 cal cul at e t he i ncr ement al pr of i t s? 03: 30PM



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Page 276

1 speci f i cal l y t o t he pr oduct s l ef t i n t he case.

2 Q. I s i t your opi ni on t hat onl y t he

3 expenses you' ve deduct ed t o cal cul at e Samsung' s4 i ncr ement al pr of i t s are necessar y f or Samsung t o

5 sel l an addi t i onal uni t f or each of t he seven 03: 32PM

6 devi ces?

7 THE WI TNESS: I ' m sor r y. I need t o

8 have you read t hat back, pl ease.

9( Recor d r ead. )

10 THE WI TNESS: I f I underst and your 03: 32PM

11 quest i on cor r ect l y, I bel i eve t hat my anal ysi s

12 of t he i ncr ement al pr of i t mar gi n has pr oper l y

13 deduct ed t hose cost s t hat woul d i ncr ease f r om an

14 addi t i onal sal e of t hat pr oduct .

15

BY MS. MAROULI S:16 Q. And Mr . Musi ka coul d have made t he

17 pr oduct - by- pr oduct cal cul at i on i f he want ed t o,

18 correct?

19 A. I don' t know how many product s wer e i n

20 t he case at t hat t i me t hat woul d have r equi r ed 03: 33PM

21

such a cal cul at i on, but I suppose t hat woul d22 have been a possi bi l i t y.

23 Q. And he di d not do t hat , r i ght ?

24 A. He di d not do t hat .

25 Q. Your cal cul at i on of Samsung' s 03: 33PM



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EXHIBIT 6



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UNI TED STATES COURT REPORTERS

1

UNI TED STATES DI STRI CT COURT

NORTHERN DI STRI CT OF CALI FORNI A

SAN J OSE DI VI SI ON

APPLE I NC. , A CALI FORNI ACORPORATI ON,

PLAI NTI FF,

VS.

SAMSUNG ELECTRONI CS CO. , LTD. ,A KOREAN BUSI NESS ENTI TY;

SAMSUNG ELECTRONI CS AMERI CA,I NC. , A NEWYORK CORPORATI ON;SAMSUNG TELECOMMUNI CATI ONSAMERI CA, LLC, A DELAWARELI MI TED LI ABI LI TY COMPANY,

DEFENDANTS.

)))))))))

))))))))

C- 11- 01846 LHK

SAN J OSE, CALI FORNI A

AUGUST 21, 2013PAGES 1-76

TRANSCRI PT OF PROCEEDI NGSBEFORE THE HONORABLE LUCY H. KOH

UNI TED STATES DI STRI CT J UDGE

APPEARANCES ON NEXT PAGE

OFFI CI AL COURT REPORTER: LEE- ANNE SHORTRI DGE, CSR, CRRCERTI FI CATE NUMBER 9595

PROCEEDI NGS RECORDED BY MECHANI CAL STENOGRAPHYTRANSCRI PT PROD

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