Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 1 of 7
`
`
`
`PAUL ANDRE (State Bar No. 196585)
`pandre@kramerlevin.com
`LISA KOBIALKA (State Bar No. 191404)
`lkobialka@kramerlevin.com
`JAMES HANNAH (State Bar No. 237978)
`jhannah@kramerlevin.com
`KRISTOPHER KASTENS (State Bar No. 254797)
`kkastens@kramerlevin.com
`KRAMER LEVIN NAFTALIS & FRANKEL LLP
`990 Marsh Road
`Menlo Park, CA 94025
`Telephone: (650) 752-1700
`Facsimile: (650) 752-1800
`
`Attorneys for Plaintiff
`FINJAN, INC.
`
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`
`FOR THE NORTHERN DISTRICT OF CALIFORNIA
`
`SAN FRANCISCO DIVISION
`
`FINJAN, INC., a Delaware Corporation,
`
`
`
`
`
`
`Plaintiff,
`
`v.
`
`
`JUNIPER NETWORKS, INC., a Delaware
`Corporation,
`
`
`
`Defendant.
`
`
`
`
`
`Case No.: 3:17-cv-05659-WHA
`
`PLAINTIFF’S FINJAN INC.’S MOTION
`TO STAY ORDER RE SEALING OF
`ORDER ON DAUBERT MOTIONS
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`FINJAN’S MOT. TO STAY
`
`CASE NO.: 3:17-cv-05659-WHA
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`

`

`Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 2 of 7
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`INTRODUCTION
`
`Finjan, Inc. (“Finjan”) respectfully requests the Court stay its order regarding the unsealing of
`
`its Daubert order so that Finjan can seek relief from the United States Court of Appeals for the
`
`Federal Circuit. This Court’s written Daubert order exposes nonpublic, confidential information of
`
`both Finjan and it third party licensees that are not a party to these proceedings, the disclosure of
`
`which will cause irreparable harm to all concerned. A stay of this Court’s order to publicly file its
`
`Daubert order is necessary for Finjan to seek meaningful appellate relief in the Federal Circuit
`
`because public disclosure of said information prior to a final order from the Federal Circuit will cause
`
`irreparable harm and render Finjan’s appeal moot.
`
`I.
`
`
`
`BACKGROUND
`
`On December 3, 2018, this Court simultaneously entered both an Order on Daubert Motions
`
`(Dkt. No. 283) (“the Daubert Order”) and an Order Re Sealing of Order on Daubert Motions (Dkt.
`
`No. 284) (“the Nonsealing Order”) which temporarily sealed the Order on Daubert Motions for two
`
`weeks in order to allow the parties time to appeal the Nonsealing Order to the Federal Circuit.
`
`Because the Court issued the Nonsealing Order and the Daubert Order on the same day, and because
`
`the Nonsealing Order defers to the Federal Circuit, neither party in this case had an opportunity to
`
`move this Court to seal the confidential portions of the Daubert Order. Per the Nonsealing Order, the
`
`unredacted version of the Daubert Order, which contains both Finjan and third party confidential
`
`business information, is set to be filed on the public docket on December 17, 2018 in the absence of a
`
`contrary order from the Federal Circuit.
`
`
`
`Today, Finjan will file a notice of appeal in this Court for the purpose of appealing the
`
`Nonsealing Order to the Federal Circuit. On appeal, Finjan will seek to obtain the following limited
`
`redactions to the Daubert Order:
`
`
`
`Description of Content Sought
`to be Redacted
`confidential licensing terms
`proposed between Finjan and a
`third party licensee pursuant to
`
`Location on the Daubert Order
`
`p.9, ll. 8-14
`
`FINJAN’S MOT. TO STAY
`
`1
`
`CASE NO.: 3:17-cv-05659-WHA
`
`

`

`Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 3 of 7
`
`
`
`NDA and Fed. R. Evid. 408
`
`confidential licensing terms
`proposed to a third party
`licensee pursuant to Fed. R.
`Evid. 408
`
`p. 10, ll. 7
`
`II.
`
`ARGUMENT
`A. The Nonsealing Order Should be Stayed Pending Final Decision by the Federal Circuit
`This Court has authority to stay an order pending appeal under Fed. R. Civ. P. 62(d) and
`
`should consider the following four factors to determine whether a stay is appropriate: ‘“(1) whether
`
`the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the
`
`applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially
`
`injure the other parties interested in the proceeding; and (4) where the public interest lies.”’ E. Bay
`
`Sanctuary Covenant v. Trump, No. 18-17274, 2018 WL 6428204, at *14 (9th Cir. Dec. 7, 2018)
`
`(quoting Hilton v. Braunskill, 481 U.S. 770, 776, 107 S. Ct. 2113, 2119, 95 L. Ed. 2d 724 (1987));
`
`Apple, Inc. v. Samsung Elecs. Co., No. 11-CV-01846-LHK, 2012 WL 3536800, at *1 (N.D. Cal. Aug.
`
`15, 2012). However, the factors need not be rigidly applied and each factor need not be given equal
`
`weight. Apple, 2012 WL 3536800 at *1 (citing Standard Havens Prod., Inc. v. Gencor Indus., Inc.,
`
`897 F.2d 511, 512 (Fed. Cir. 1990)). Indeed, “when harm to an applicant is great enough, a court will
`
`not require a ‘strong showing’ that applicant is ‘likely to succeed on the merits.’” Standard Havens
`
`Prod., Inc. v. Gencor Indus., Inc., 897 F.2d 511, 513 (Fed. Cir. 1990) (citing Hilton, 481 U.S. at 776).
`
`Here, all the factors weigh in favor of granting the stay of the Unsealing Order pending final decision
`
`of the Federal Circuit.
`i. Finjan and Nonparty Licensees Will be Irreparably Harmed Absent a Stay
`Finjan and its third party licensees, F5 and Sophos, who are not parties to this action, will be
`
`irreparably harmed if a stay is not granted. See Declaration of Julie Mar-Spinola (“Mar-Spinola
`
`Decl."), ¶¶ 2-3. The Daubert Order discloses information exchanged between Finjan and its third
`
`party licensees in the course of confidential licensing negotiations in settlement of pending litigations
`
`subject to Fed. R. Evid. 408. Specifically, the Daubert Order discloses proposed licensing fee
`
`FINJAN’S MOT. TO STAY
`
`2
`
`CASE NO.: 3:17-cv-05659-WHA
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`

`

`Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 4 of 7
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`amounts and rates discussed by the parties during settlement negotiations. Dkt. No. 283 at 9:8-14;
`
`10:7. The licensing discussions with F5 were also subject to a nondisclosure agreement requiring the
`
`parties to maintain the confidentiality of exchanged information. Mar-Spinola, Decl., ¶ 3.
`
`Finjan and its third party licensees have taken measures to apply an extremely high level of
`
`protection to the information above because making their private business information public will
`
`render them “irreparably damaged in a way not correctable on appeal.” In re Electronic Arts, Inc.,
`
`298 Fed.Appx. 568, 570, 2008 WL 4726222, at *2 (9th Cir. 2008) (district court’s refusal to seal
`
`licensing terms and royalty rates was an abuse of discretion); See Mar-Spinola Decl. at ¶¶ 2-3; see
`
`Apple, Inc. v. Samsung Electronics Co., et al., Case No. 11-cv-01846-LHK, 2012 WL 3283478 at *7
`
`(N.D. Cal. Aug. 9, 2012) (granting the sealing of licensing agreements because disclosure would
`
`cause “significant competitive harm to the licensing parties as it would provide insight into the
`
`structure of their licensing deals, forcing them into an uneven bargaining position in future
`
`negotiations”); see also Open Text S.A. v. Box, Inc., No. 13-cv-04910-JD, 2014 WL 7368594, at *3
`
`(N.D. Cal. Dec. 26, 2014) (granting motion to seal pricing terms of license agreement).
`
`In particular, disclosure of these confidential settlement discussions would cause irreparable
`
`harm when such information was exchanged between Finjan and the third party licensees subject to
`
`Fed. R. Evid. 408 to settle pending litigations. Dkt. No. 283 at 9, ll.8-14, p. 10, ll.7; Mar-Spinola
`
`Decl., ¶ 2. This confidential information, if disclosed, could be improperly used as evidence by other
`
`potential licensees in active negotiations to value their license fees. Mar-Spinola Decl., ¶ 2; see
`
`LaserDynamics, Inc. v. Quanta Computer, Inc., 695 F.3d 51, 77 (Fed. Cir. 2012) ( “Along these lines,
`
`Federal Rule of Evidence 408 specifically prohibits the admission of settlement offers and
`
`negotiations offered to prove the amount of damages owed on a claim”); see also France Telecom
`
`S.A. v. Marvell Semiconductor, Inc., No. 12-cv-04967-WHO, 2014 WL 12605474, at *1 (N.D. Cal.
`
`Sept. 17, 2014) (excluding the substance of communications that were subject to Rule 408 from trial
`
`that discussed proposed terms and the parties respective positions relating to the validity or amount of
`
`plaintiff’s infringement claim); SRI Int’l, Inc. v. Cisco Sys., Inc., 179 F.Supp.3d 339, 369 (D. Del.
`
`2016) (excluding settlement agreements subject to Fed. R. Evid. 408 as they are a product of litigation
`
`FINJAN’S MOT. TO STAY
`
`3
`
`CASE NO.: 3:17-cv-05659-WHA
`
`

`

`Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 5 of 7
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`that reflect the parties’ consideration of multiple factors unrelated to valuation issues). Also, if
`
`confidential licensing discussions with F5 that was subject to a non-disclosure agreement were
`
`publicly disclosed, competitors in the marketplace could use such publicly disclosed confidential
`
`information to unfairly compete by using such confidential proposed pricing and licensing terms in
`
`business dealings among others in the marketplace to undercut Finjan and its licensees. Mar-Spinola
`
`Decl., ¶ 3. Once information is disclosed there can be no remedy as an appeal would be moot. See In
`
`re Copley Press, Inc., 518 F.3d 1022, 1025 (9th Cir. 2008) (“Secrecy is a one-way street: Once
`
`information is published, it cannot be made secret again.”).
`ii. Finjan is Likely to Succeed on the Merits on Appeal
`The Unsealing Order is immediately appealable to the Federal Circuit as a collateral order.
`
`See Apple Inc. v. Samsung Elecs. Co., 727 F.3d 1214, 1220 (Fed. Cir. 2013) (holding that an order
`unsealing confidential business information is a collateral order).1 Since substantive patent law is not
`at issue on appeal, the Federal Circuit will apply the law of the Ninth Circuit. Apple, 727 F.3d. at
`
`1220. When district courts within the Ninth Circuit decide whether to seal court records, the interest
`
`of the party seeking to seal the record is balanced against that of the public. Kamakana v. City & Cty.
`
`of Honolulu, 447 F.3d 1172, 1179 (9th Cir. 2006). While a party ordinarily must show compelling
`
`reasons for removing court records from the public domain, a party seeking to seal the record need
`
`only show good cause when the sealing relates to non-dispositive motions, such as Daubert motions,
`
`because the public has a much lower interest in documents that are only tangentially related to the
`
`underlying cause of action. Id.; Apple, 727 F.3d at 1222.
`
`As discussed above, Finjan and its licensees will be irreparably harmed if the stay is not
`
`granted. Finjan and future licensees will be unwilling to engage in discussions to settle litigations
`
`should they not be assured that Fed. R. Evid. 408 will protect such discussions from public disclosure.
`
`See Mar-Spinola Decl., at ¶ 2. The harm to Finjan greatly outweighs any minimal interest the public
`
`1 Like the collateral order appealed in Apple, this Court’s Unsealing Order is a collateral order because
`it conclusively determines that confidential information will be disclosed, it presents an important issue
`regarding the public’s access to information, and waiting for final judgement would effectively make it
`unreviewable.
`
`FINJAN’S MOT. TO STAY
`
`4
`
`CASE NO.: 3:17-cv-05659-WHA
`
`

`

`Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 6 of 7
`
`
`
`may have in accessing the limited portions of the Daubert Order sought for redaction. Thus, on
`
`appeal, Finjan will demonstrate that there is good cause for sealing and will likely succeed on the
`
`merits. See Apple, 2012 WL 3283478 at *7 (the Court found compelling reasons for sealing license
`
`agreements because the harm to the parties to the agreements greatly outweighed the “marginal value”
`
`of their terms to the public).
`iii. A Stay Will Not Injure Any Entity Interested in these Proceedings
`Issuing a stay will not injure anyone with an interest in these proceedings, including the
`
`public. A stay merely maintains the status quo. Nken v. Holder, 556 U.S. 418, 429, 129 S. Ct. 1749,
`
`1758, 173 L. Ed. 2d 550 (2009)(“A stay ‘simply suspend[s] judicial alteration of the status quo’”)
`
`(quoting Ohio Citizens for Responsible Energy, Inc. v. NRC, 479 U.S. 1312, 1313 (1986)). A stay of
`
`the unsealing order will not impact the rights of the Defendant in this action. Likewise, the public
`
`will not be injured by a stay because if the Federal Circuit ultimately finds that Finjan does not have
`
`good cause for sealing, the public will get full access to those limited pieces of information that Finjan
`
`seeks to redact.
`iv. A Stay is in the Public’s Interest
`A stay serves the public interest in having the courts reach a proper resolution and provide full
`
`and fair opportunity for litigants to be heard. Granting a stay will accomplish both of those interests.
`
`On the other hand, denying a stay will harm the public interest. Companies will be more reluctant to
`
`engage in licensing discussions and business dealings with each other if they have no control over
`
`how their private information is disseminated and this chilling effect will harm the public. See Mar-
`
`Spinola Decl. at ¶¶ 2-3.
`
`CONCLUSION
`
`For the foregoing reasons, Finjan respectfully requests that the Court stay it’s Unsealing Order
`
`until the Federal Circuit reaches a final decision on the merits.
`
`
`
`
`
`FINJAN’S MOT. TO STAY
`
`5
`
`CASE NO.: 3:17-cv-05659-WHA
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`

`

`Case 3:17-cv-05659-WHA Document 331 Filed 12/14/18 Page 7 of 7
`
`DATED: December 14, 2018
`
`Respectfully submitted,
`
`By: /s/ Hannah Lee
`
`
`
`Paul J. Andre (State Bar No. 196585)
`Lisa Kobialka (State Bar No. 191404)
`James Hannah (State Bar No. 237978)
`Kristopher Kastens (State Bar No. 254797)
`Hannah Lee (State Bar No. 253197)
`KRAMER LEVIN NAFTALIS
` & FRANKEL LLP
`990 Marsh Road
`Menlo Park, CA 94025
`Telephone: (650) 752-1700
`pandre@kramerlevin.com
`lkobialka@kramerlevin.com
`jhannah@kramerlevin.com
`kkastens@kramerlevin.com
`hlee@kramerlevin.com
`
`Attorneys for Plaintiff
`FINJAN, INC.
`
`
`
`
`
`FINJAN’S MOT. TO STAY
`
`6
`
`CASE NO.: 3:17-cv-05659-WHA
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`
`
`