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`Pages 1-13
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`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF CALIFORNIA
`SAN FRANCISCO DIVISION
`
`FINJAN, INC., a Delaware
`Corporation,
`
`Plaintiff,
`
`v.
`
`JUNIPER NETWORKS, INC., a
`Delaware Corporation,
`
`)
`
`))
`
`)
`Defendant.
`_____________________________)
`
`TRANSCRIPT OF TELEPHONIC DISCOVERY HEARING
`BEFORE THE HONORABLE THOMAS S. HIXSON
`UNITED STATES MAGISTRATE JUDGE
`
`APPEARANCES:
`
`For Plaintiff:
`
`For Defendant:
`
`Transcription Service:
`
`PAUL J. ANDRE, ESQ.
`Kramer Levin Naftalis & Frankel, LLP
`990 Marsh Road
`Menlo Park, California 94025
`(650) 752-1700
`
`HARRY A. MITTLEMAN, ESQ.
`Irell & Manella, LLP
`1800 Avenue of the Stars, Suite 900
`Los Angeles, California 90067-4276
`(310) 277-1010
`
`Peggy Schuerger
`Ad Hoc Reporting
`2220 Otay Lakes Road, Suite 502-85
`Chula Vista, California 91915
`(619) 236-9325
`
`Proceedings recorded by electronic sound recording; transcript
`produced by transcription service.
`
`) Case No. 17-cv-05659-WHA
`
`San Francisco, California
`Courtroom A, 15th Floor
`Thursday, June 6, 2019
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 2 of 13
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`2
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`SAN FRANCISCO, CALIFORNIA
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`THURSDAY, JUNE 6, 2019 10:42 A.M.
`
`(Call to order of the Court.)
`
`--oOo--
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`THE CLERK:
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`This case is going to be 17-5659, Finjan,
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`Inc. v. Juniper Networks, Inc.
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`Counsel, please state your
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`appearances for the record. Let’s start with Plaintiff.
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`MR. ANDRE:
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`Good morning, Your Honor.
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`This is Paul
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`Andre for Finjan, Plaintiff.
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`THE COURT: Good morning.
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`UNIDENTIFIED SPEAKER:
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`Yes.
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`(Indiscernible) for the
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`Defendant.
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`THE COURT:
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`Good morning.
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`We are here today on a
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`discovery letter brief about Shlomo Touboul’s -- I’m probably
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`mispronouncing the last name -- deposition, and Juniper has made
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`an argument that Judge Alsup issued an order in December of 2018
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`and it looked to me when I read the full context that what he was
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`really doing was not allowing a deposition in a different lawsuit
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`to be entered into evidence. And I didn’t see that as necessarily
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`providing any indication concerning how Mr. Touboul’s deposition
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`should proceed.
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`Is there something that I misunderstood about that, Mr.
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`Mittleman?
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`MR. MITTLEMAN:
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`Thank you, Your Honor.
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`I actually
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`didn’t make my appearance yet.
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`Another counsel did.
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`This is
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`Harry Mittleman for Juniper Networks. The context in which that
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 3 of 13
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`3
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`stage arose -- this concerned depositions from another case -- we
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`cited to it to address the point that Judge Alsup has already
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`rejected the notion that Mr. Touboul has an excuse to remain in
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`Israel and to testify via videotape because of his travel
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`difficulties.
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`So that is the purpose that we were citing that
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`exchange for.
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`The grounds for the motion that we have brought are the
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`following:
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`The -- our opponent, Mr. Andre’s client, Finjan, has
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`taken the position that it may take up to ten 30(b)(6) depositions
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`so long as each one is one second shy of three hours -- three and
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`a half hours.
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`So that it depicts, in theory, 34 hours and 50
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`seconds of 30(b)(6) depositions and that’s what Judge Alsup’s
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`order permits. I submit that that is a preposterous position and
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`totally inconsistent with the obvious purpose of the standing
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`order, which is to set limits on how many times a person can
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`depose different witnesses and contend that they’re all simply one
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`corpus designation -- deposition.
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`So we are here because Finjan’s taking the position that they
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`should have carte blanche to take as many as they want as long as
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`they stay one second under three and a half hours on the record.
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`And I’ve looked at the standing order and that makes no sense and
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`it cannot be squared with the language of the logic of the order.
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`And the second issue that is dividing us with respect to Mr.
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`Touboul is that Finjan contends that it has been given blanket
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`permission by Judge Alsup to depose any of their own witnesses if
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 4 of 13
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`4
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`they contend that those witnesses may have a trial conflict. And
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`I’ve read the relevant exchange and the order from Judge Alsup,
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`and Judge Alsup said that witnesses could testify via videotaped
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`deposition if they have a trial conflict with the San Diego trial
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`that starts on October 29th in -- in Judge McKeown’s courtroom.
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`He didn’t say that Finjan has carte blanche simply to fly around
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`the world deposing its own witnesses, which is highly unusual.
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`And that brings us to the present dispute. Because we do not
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`believe that any sensible reading of the standing order permits 35
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`hours and -- 34 hours and 50 seconds of 30(b)(6) depositions --
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`that cannot be right -- we calculate them as already exceeding --
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`already hitting the limit such that if they wish to take Mr.
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`Touboul’s deposition, they must make a showing of good cause to do
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`so and no such showing has been made.
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`And we dispute and reject the argument that there is no need
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`for them to obtain leave to take Mr. Touboul’s deposition because
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`they believe that as long as they keep a deposition one second
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`under three and a half hours, they can take as many as they like.
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`That just can’t be right.
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`And we disagree that there is a blanket permission for them
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`to fly around the country deposing their own witnesses, which is
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`such a highly unusual thing. The order from Judge Alsup was very
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`clear.
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`"If there is a showing of a trial conflict such that a
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`Finjan witness cannot appear at the October 21st trial in this
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`case because that witness has a trial conflict with the October
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 5 of 13
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`5
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`29th trial in the San Diego case, then in that situation a witness
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`may testify via videotape."
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`But no such showing has been made.
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`I have searched
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`repeatedly and in vain for any representation that Mr. Touboul
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`does in fact have a trial conflict.
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`There is no representation
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`that he is in fact going to travel to Southern California to be at
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`the October 29th trial. There is no representation one way or the
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`other.
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`And I’d note that the trial in this case is on October
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`21st, which is before the other trial, so no explanation has been
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`given as to why Mr. Touboul has a conflict that prevents him from
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`appearing in this case on the 21st because there is a later case
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`beginning on the 29th, particularly when there is not any
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`representation, let alone evidence, that Mr. Touboul is going to
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`attend the other trial and thus has a conflict.
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`And so what it appears to us to be is a situation where
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`Finjan, for reasons of -- of convenience wishes to depose its own
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`witness, which is highly unusual, and to require Juniper to send
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`an attorney to Israel for the purpose of appearing at that
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`deposition.
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`And we think that that’s improper.
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`If they wish to take a deposition in excess of the ten-
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`deposition limit, they are certainly free to make a motion before
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`the Judge.
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`And if there is good cause for them to do it, I
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`believe the Judge would give them permission. But at this point,
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`no good cause has been shown. No leave has been obtained. And we
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`calculate their time.
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`The deposition that they wish to take of
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 6 of 13
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`6
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`Mr. Touboul is clearly over the limit.
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`And that is the crux of
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`our dispute.
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`THE COURT: Okay. Thank you, Counsel. Mr. Andre, I’ll
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`ask you to respond and specifically I’d like you to address the
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`parties’ stipulation that depositions or party employees will
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`occur within the Northern District of California.
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`I understand
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`your argument that Touboul might technically not be an employee.
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`He’s a consultant and advisor, founder of the company, paid more
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`than $200,000 annually. And my question is: Aren’t you engaging
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`in a bit of technical hair-splitting in saying he’s not an
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`employee?
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`So why don’t you speak to those issues.
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`MR. ANDRE: Sure, Your Honor. This is Paul Andre. With
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`respect to the employee issue, Mr. Touboul is a, as you noted, the
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`founder of the company and acting as a consultant.
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`But Mr.
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`Touboul is not an employee under California law, straight and
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`simple.
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`In his consulting agreement, it’s very specifically spelled
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`out that he is not an employee and we don’t have control over him
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`to that degree.
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`And on the ABC test that was recently articulated by the
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`California Supreme Court, all three of those factors would
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`indicate that he is not an employee.
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`We don’t have control.
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`We’ve not made him come work at his will.
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`He can simply, you
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`know, choose or not to. He performs work outside of Finjan. He’s
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 7 of 13
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`7
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`the CEO of another company that he founded. And he’s a consultant
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`for several other companies. So we’re not even sure that we could
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`get him to come over to trial one way or another. We just don’t
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`know yet.
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`So is it a technical hair-splitting?
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`I don’t think it is,
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`Your Honor, because if we can’t control a witness, if we don’t
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`have the kind of power we have over employees, then he’s not an
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`employee.
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`THE COURT:
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`Were you able to bring him here for the
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`December trial?
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`MR. ANDRE:
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`No, Your Honor.
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`Mr. Touboul has an issue
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`of traveling long distances.
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`He will come over to the United
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`States on occasion, but it’s something he has planned much in
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`advance and we were not able to get him here for the December
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`trial.
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`We tried.
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`He wouldn’t come.
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`So we tried to play his
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`testimony from a previous date and, as Your Honor correctly
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`pointed out -- and I guess you read the transcript that we
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`provided -- Judge Alsup was having none of it.
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`We tried to
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`explain his medical person, we couldn’t get him here in person.
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`He said, "Too bad. You have to do without him." And that’s what
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`we did.
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`So we now have a situation where Judge Alsup -- and no
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`disrespect to Judge Alsup at all -- but he has knowingly scheduled
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`the Finjan trial that overlaps another Finjan trial. And he told
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`us that Finjan’s not entitled to switch the calendar. And Finjan
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 8 of 13
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`8
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`is not entitled to have its witnesses there live necessarily if
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`there’s a conflict.
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`So the remedy he gave us with the second
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`issue regarding prejudice to our witnesses is, Take their
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`deposition.
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`He explicitly told us -- he goes, Take the
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`depositions.
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`I’m not moving the trial date.
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`Get different
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`lawyers.
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`And we’re trying to do that.
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`So in spite of the fact that we’re not getting -- Finjan’s
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`not getting switch of counsel, it’s being prejudiced by the fact
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`that we can’t bring our witnesses live and we have to juggle our
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`experts around, Juniper still wants to prejudice us further saying
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`that we’re not even entitled to videotape depositions of the
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`witnesses where they reside.
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`There’s absolutely no reason why
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`they would deny it.
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`They came up with a second counting on the current
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`depositions than when we counted that. That’s a bit of form over
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`substance.
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`And what we’re trying to do here is make sure we’re
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`not in the same situation we were in in December where if we tried
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`to play the deposition testimony of Mr. Touboul, that it somehow
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`would be precluded.
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`We’re doing exactly what Judge Alsup ordered us to do.
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`MR. MITTLEMAN:
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`And, Your Honor, may I respond?
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`THE COURT: Yeah, briefly, please.
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`MR. MITTLEMAN: I shall. The order does not tell Finjan
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`to go around and depose any person under its control on the
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`prophylactic basis that that person might have a conflict. What
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 9 of 13
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`9
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`the Court says and what the colloquy clearly says is that a
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`witness who has a trial conflict with the trial in San Diego may
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`testify by video. But there has been no showing that this witness
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`has a trial conflict with the trial in San Diego.
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`I would just ask: Is Counsel representing that Mr. Touboul
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`is in fact traveling to California to testify at the October 29th
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`trial? Is he in fact doing that? Because if he is not, then the
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`entire basis for citing the trial conflict order evaporates.
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`On the other hand, if they say that he will be traveling to
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`California to attend the trial on October 29th, they fail to
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`explain why he can’t appear at a trial that starts earlier, on
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`October 21st.
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`They have never explained, first, that this
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`individual actually intends to be for the second trial and they’ve
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`never explained why if he can travel for that trial, he can’t be
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`out here for this trial.
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`There is simply no showing of a
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`conflict. And that -- and it’s the existence of a trial conflict
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`that is the explicit linchpin of Judge Alsup’s order. And since
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`there has been no showing -- I mean, I would ask: Does anyone --
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`does anyone have any information that Mr. Touboul is in fact going
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`to attend the October 29th trial in San Diego?
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`I submit there’s no evidence of that. And the fact that they
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`are suggesting that he might, that he may, is not good cause to
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`send lawyers all -- halfway around the world to Israel next week.
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`The
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`fact
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`that
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`we
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`don’t
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`have
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`any
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`evidence,
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`let
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`alone
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`a
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`representation that he will in fact have such a conflict because
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 10 of 13
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`10
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`he is coming to California, I would think is very telling. And if
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`he is coming to California on the 29th, I don’t understand why he
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`can’t come on the 21st. That has never been explained.
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`And so the reference to Judge Alsup’s order is, in my view,
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`respectfully a total red herring because the requisites within tha
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`order have never been articulated, let alone shown.
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`So that
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`addresses, I believe, their first argument which is that they have
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`permission just to depose anyone they want on their side as a
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`prophylactic measure now in the possible event that such a person
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`might have a conflict in the future with the San Diego trial.
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`If and when we get closer to that trial and there’s a
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`conflict, then of course we will meet and confer with them and be
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`reasonable and discuss in good faith how we deal with that. But
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`we are five months away.
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`And what this appears to us to be is
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`simply a tactic to drag us to Israel to take -- for them to take
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`a deposition of their own witness -- very strange -- in some
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`attempt to try to create a video record that they can play in
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`trial whether there’s a conflict or not.
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`And that is utterly
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`inconsistent with Judge Alsup’s order.
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`And the second point -- and I’ll end very briefly -- is that
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`their argument that they are entitled to take as many 30(b)(6)
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`depositions that they want, up to ten, as long as they stay one
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`second shy of three and a half hours, so that they can take 34
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`hours and 50 seconds of deposition and treat it as one deposition,
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`is so preposterous that it cannot possibly be correct. And on any
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`11
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`sensible reading of Judge Alsup’s standing order, it is not.
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`And so what we are facing is a situation where sensible
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`limits are imposed from Judge Alsup, much mischief will ensue and
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`there will be tremendous burden and expense to Juniper.
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`And the issue of the employee, I think Your Honor has it just
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`right.
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`We are really engaged in a hair-splitting form over
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`substance discussion when we ask whether this individual is an
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`employee under California law. First of all, the contract that he
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`signed is governed by Israeli law and no one has told the Court
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`what Israeli law is.
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`But, in any event, when you read the
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`contract, it says that he agrees that he will have to do
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`international travel.
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`And it also says that he has a highly
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`fiduciary obligation to this company and is prohibited from
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`competing with the company in any way.
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`And Judge Alsup clearly saw and had said, He’s their guy.
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`He’s standing to benefit from this.
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`And the idea that he was
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`somehow not within their control is utterly destroyed by the very
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`terms of the agreement they cite.
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`And there’s just been no
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`showing why he can’t come here.
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`I had a brief look on Google and have found multiple
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`instances where this witness, Mr. Touboul, has traveled recently
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`to the United States to give talks at conferences. And in their
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`own papers, they describe his regular practice for flying to
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`California.
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`So this is an individual who frequently travels to
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`the United States for promotional and conference purposes.
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`He
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 12 of 13
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`12
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`frequently travels to the United States, according to Finjan’s own
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`representation, and Judge Alsup has already rejected the argument
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`that the travel issues that have been attributed to some blood
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`clots that he has, a situation that has not been explained, is an
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`excuse not to appear.
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`And so our position is that they should seek leave from Judge
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`Alsup if they want to take his deposition. If they have to travel
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`to do so, then I’m sure they’ll get the leave.
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`But they can’t
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`just resort to self-help and point to that order and --
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`THE COURT:
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`Counsel, thank you.
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`I think I understand
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`your --
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`MR. MITTLEMAN:
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`-- furthermore, --
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`THE COURT:
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`Counsel, thank you.
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`I understand your
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`argument.
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`I’m going to take this under submission and an order
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`will issue shortly.
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`MR. MITTLEMAN:
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`Thank you, Your Honor.
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`THE CLERK: Thank you, Counsel.
`
`//
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`fF Ty b JN
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`|
`| \
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`é
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`Signature of Approved Transcriber
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`September 29, 2019
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`Date
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`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 13 of 13
`Case 3:17-cv-05659-WHA Document 618 Filed 09/30/19 Page 13 of 13
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`(Proceedings adjourned at 11:01 a.m.)
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`I, Peggy Schuerger, certify that
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`the foregoing is a
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`correct transcript
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`from the official electronic sound recording
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`provided to me of the proceedings in the above-entitled matter.
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`Pegay Schuerger
`Typed or Printed Name
`Ad Hoc Reporting
`Approved Transcription Provider
`for the U.S. District Court,
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`Northern District of California
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