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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 1 of 22 PageID #: 47131
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`IN THE UNITED STATES DISTRICT COURT
`IN AND FOR THE DISTRICT OF DELAWARE
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`CIVIL ACTION
`
`NO. 16-453 (RGA)
`
`
` - - -
`Wilmington, Delaware
`Friday, April 20, 2018
`9:05 o'clock, a.m.
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`
`BEFORE: HONORABLE RICHARD G. ANDREWS, U.S.D.C.J.
`- - -
`
`:::::::::
`
`ACCELERATION BAY LLC,
`Plaintiff,
`
`vs.
`ACTIVISION BLIZZARD, INC.,
`Defendant.
`
`
`
`APPEARANCES:
`
`POTTER, ANDERSON & CORROON LLP
`BY: PHILIP A. ROVNER, ESQ.
`
`-and-
`
`Valerie J. Gunning
`Official Court Reporter
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`
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`
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 2 of 22 PageID #: 47132
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`APPEARANCES (Continued):
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`KRAMER LEVIN NAFTALIS & FRANKEL LLP
`BY: PAUL J. ANDRE, ESQ. and
`LISA J. KOLBIALKA, ESQ.
`(Menlo Park, California)
`
`-and-
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`KRAMER LEVIN NAFTALIS & FRANKEL LLP
`BY: AARON M. FRANKEL, ESQ. and
`CRISTINA L. MARTINEZ, ESQ.
`(New York, New York)
`
`
`
`Counsel for Plaintiff
`
`MORRIS, NICHOLS, ARSHT & TUNNELL LLP
`BY: JACK B. BLUMENFELD, ESQ. and
`STEPHEN J. KRAFTSCHIK, ESQ.
`
`-and-
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`WINSTON & STRAWN LLP
`BY: DAVID P. ENZMINGER, ESQ. and
`MICHAEL A. TOMASULO, ESQ.
`(Los Angeles, California)
`
`-and-
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`WINSTON & STRAWN LLP
`BY: KATHLEEN BARRY, ESQ.
`(Chicago, Illinois)
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`-and-
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 3 of 22 PageID #: 47133
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`APPEARANCES (Continued):
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`WINSTON & STRAWN LLP
`BY: MICHAEL M. MURRAY, ESQ.
`(New York, New York)
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`-and-
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`SHOOK, HARDY & BACON
`BY: B. TRENT WEBB, ESQ.
`(Kansas City, Missouri).
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`Counsel for Defendant
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 4 of 22 PageID #: 47134
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`P R O C E E D I N G S
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`(Proceedings commenced in the courtroom,
`beginning at 9:05 a.m.)
`
`THE COURT: Good morning, everyone. Please be
`
`seated.
`
`So this is the time scheduled for the pretrial
`conference in Acceleration Bay versus Activision.
`Can we just have on the record who is here,
`
`please?
`
`Mr. Rovner?
`MR. ROVNER: Good morning, Your Honor. Phil
`Rovner from Potter Anderson for plaintiff, Acceleration Bay,
`and with me from Kramer Levin is Paul Andre, Lisa Kobialka,
`Cristina Martinez, and Aaron Frankel.
`THE COURT: All right. Good morning to you
`
`all.
`
`MR. BLUMENFELD: Good morning, Your Honor.
`THE COURT: Mr. Blumenfeld?
`MR. BLUMENFELD: Good morning, Your Honor. Jack
`Blumenfeld from Morris Nichols for Activision.
`At the front table, David Enzminger from Winston
`& Strawn, Trent Webb from Shook Hardy & Bacon.
`At the second table, Mike Tomasulo, Kathleen
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 5 of 22 PageID #: 47135
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`Barry and Mike Murray, all from Winston & Strawn.
`And then in the second row in the back, Steve
`Kraftschik from Morris Nichols and Omar Zalick and Julia
`Kazaks from Activision.
`THE COURT: All right. Well, good morning to
`you all, too.
`All right. So I don't have too much time this
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`morning.
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`So it's possible that, or, in fact, probable
`that I will have the opinions on the summary judgment and
`Daubert out by the end of next week. I expect that I will
`also make some ruling on the motions in limine by the end of
`next week.
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`And I see there are a few other disputes in the
`pretrial order. And I also have the letters about the
`damages report of Ms. Meyer that I issued an oral order on.
`But I think the main thing actually is that
`notwithstanding all of that, there's another trial ahead of
`you next week, and they aren't showing any signs of going
`away.
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`So I'm thinking that maybe we -- so I'm
`perfectly happy to keep you on. Maybe they will go away,
`but I could also be persuaded very easily to give you
`another date.
`What do you want to do?
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 6 of 22 PageID #: 47136
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`MR. ANDRE: Well, Your Honor, Paul Andre.
`I know what defendants are going to do,
`obviously, but we would like to keep the trial date, but we
`do have some issues about hotel reservations and that kind
`of stuff.
`
`If we don't get the cancellation by the end of
`business today, then we're on the hook for all the cost. So
`if we could lock in a date in the near future, that would be
`our preference.
`THE COURT: Well, so I have -- the one date that
`I have in the near future is June 25th. I mean, I've got
`trial scheduled every other week. Some of them will go
`away, but they're just like the trial next week, or the
`trial the week after next. You just don't know. But
`June 25th, there's nothing else, no other trials on my
`calendar, so that date is available.
`MR. ANDRE: Can I check our calendar, sir?
`THE COURT: Yes.
`MR. ENZMINGER: Your Honor, we'll check the
`calendars for June 25th as well. Just a survey of counsel,
`it seems like it might work.
`One date we know works is August 27th, because
`all of the lawyers in this case and the Court already have
`that date blocked out.
`THE COURT: Right. Well, you say blocked out.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 7 of 22 PageID #: 47137
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`Let me just check and see how realistic that is. You might
`be right.
`
`
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`Unfortunately, I've got a Hatch-Waxman trial
`that I had to reschedule for that, which I've already
`rescheduled at least once, so you're not actually first on
`that date either.
`MR. ENZMINGER: Okay.
`THE COURT: And those people, I think, are more
`likely to go to trial than the people that are currently
`ahead of you for the week after next, but I don't know about
`that either.
`MR. ENZMINGER: We would take June 25th.
`THE COURT: All right. Well, I know you have
`experts and the like that you need to probably check on, but
`as far as I know, my staff hasn't offered that date to
`anyone else.
`So if you want to say -- if it's tentatively
`good for you, and if you want to reserve the right to check
`and get back to me on Monday or something like that, that
`would be fine.
`MR. ANDRE: Your Honor, we can see if we can
`move things around, but we anticipate this might happen. It
`looks like we would lose at least three, possibly four of
`our experts on that week, so I know that I have a, part of
`the team will be on honeymoon, so -- not me.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 8 of 22 PageID #: 47138
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`THE COURT: I assumed it was one of the others.
`MR. ANDRE: Yes. So I don't know if June 25th
`is going to work. The dates we have are, I don't know, like
`July 16th or --
`THE COURT: Yes. See, unfortunately, those
`dates, the middle of the summer don't really work for me.
`I mean, really, I had, sort of have dates in early
`September, but I filled that in with another trial that I
`had to bump.
`So these things tend to go away, but the only
`weeks that I'm looking at in the future that are
`theoretically available is the week of September 10th, which
`starts with Rosh Hashana, and the week of November 5th,
`which has Election Day on November 6th. Actually, I've got
`actually quite a bit of free time that week and the
`following week, and, of course, Election Day and Veteran's
`Day, they can be skipped.
`Actually, so any time in the November 5th
`through November 21st, there's a day here or there that is a
`holiday, but actually, no trials scheduled.
`MR. ENZMINGER: We have another related case in
`this case is set for October 27th or 29th, something like
`that, Take 2.
`THE COURT: Yes.
`MR. ENZMINGER: So we have that week available.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 9 of 22 PageID #: 47139
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`THE COURT: You are right. That is on my
`calendar. That is actually unconflicted unless you count
`Halloween as a conflict.
`MR. ENZMINGER: I don't count Halloween as a
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`conflict.
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`THE COURT: But that one is sitting there. That
`one has no competition. And just when I was looking, I was
`looking for free weeks.
`MR. ENZMINGER: Right.
`THE COURT: So --
`MR. ENZMINGER: So we know that that week works
`for everyone on this trial team on both sides.
`MR. ANDRE: Your Honor, I think at this point,
`if June is the only day you can confirm before November, I
`think what we would prefer to do is, for the time being,
`roll this trial back to August, the next trial date we
`have, I know we're double-booked on that one, and then have
`another pretrial conference and see if we can't -- maybe the
`Hatch-Waxman case goes away.
`THE COURT: I mean, it's possible. They do
`settle -- I mean, a lot of them do settle, but most of
`them that are going to settle, settle before -- I mean, I
`can't remember whether I had a pretrial conference in that
`or I continued it around about that time.
`MR. ANDRE: All right.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 10 of 22 PageID #: 47140
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`THE COURT: In fact, I don't think I had the
`pretrial conference because I don't think I decided the
`motions in limine that one either.
`But I'm perfectly happy to -- you are on the
`calendar for that date. I don't know.
`The other defendants, do you all represent the
`other defendants?
`MR. ENZMINGER: We do, and we've checked with
`them, and this would be acceptable to them.
`THE COURT: Okay.
`MR. ANDRE: So if we move -- we can kind of keep
`shuffling the deck back further if we have to, but reserve
`the August date for Activision, take the -- did you say you
`had a date in -- was it September?
`THE COURT: Well, Rosh Hashanah, the week of
`September 10th.
`MR. ANDRE: And that would come around with the
`other trials.
`THE COURT: Yes, it would.
`MR. ENZMINGER: Yes, so that would be a problem
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`for us.
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`MR. ANDRE: So maybe take the August date for
`Activision, the October date for EA, and then the date in
`November you said is open.
`THE COURT: Yes. I mean, if you wanted to try
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 11 of 22 PageID #: 47141
`11
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`to create some space between the second date, or the
`October 29th date, given where Thanksgiving is and given
`what my schedule is, we could set it on that if it would
`worked for you on November 13th, which is Tuesday, the
`Tuesday after Veteran's Day, which is a federal holiday, and
`that it would go into the week of Thanksgiving.
`MR. ANDRE: That should be fine. Thank you.
`MR. ENZMINGER: From our perspective, that's a
`little tight because their products in that case don't
`overlap at all with the second trial, and you are talking
`about finishing one trial and starting the other a week
`later, two weeks later.
`THE COURT: Well, it's an amazing thing.
`Actually, I hate to break up this beautiful thing, but
`as I'm looking at it now as I scroll down, I'm also free
`the week of November 26th, which is the week after
`Thanksgiving if you wanted to create a little more space
`in between the schedule, so we can start that on Monday,
`November 26th.
`MR. ENZMINGER: I was actually handed a note
`that one of our key witnesses on the Destiny product is not
`available in August.
`THE COURT: Okay. When you say one of your key
`witnesses, one of your experts or a fact witness?
`MR. ENZMINGER: No. He is the Bungie fact --
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`12
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`remember Destiny is a game that isn't an Activision game.
`THE COURT: I've seen that, yes.
`MR. ENZMINGER: Mr. Wolfson is the Destiny
`engineer at Bungie Corporation.
`THE COURT: Well, so how wedded are you to
`having the Activision trial go first, because as you say, we
`already -- well, actually, why don't we do this, because
`this is probably inefficient use of all of our time here to
`try to do this like this.
`I've got available, and the only reason that I
`say this, is that I actually hesitate to say this is because
`I'm not entirely sure -- well, so we've got the week of
`August 29th, or 27th, that somebody scheduled for then.
`We for sure have the week of October 29th. I'm
`telling you that I can do at this point any five days that
`don't involve holidays starting in November.
`Maybe we're not wedded to dog this in the
`order in which they are currently scheduled to be done if
`there's some key witness who is not available for one or
`the other?
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`MR. ENZMINGER: I think on that, yes. I mean, I
`think one of the better ways to approach this is we can
`maybe talk to the witnesses and find out what unavailable
`really means.
`THE COURT: Okay.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 13 of 22 PageID #: 47143
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`MR. ENZMINGER: I can't say we're willing to
`switch the order of the trials right now because two of the
`clients that would have to be part of that decision aren't
`here.
`
`
`
`THE COURT: All right. Okay. So can I ask that
`you all go and talk to your various clients and talk to,
`figure out your various witnesses and see if you can't pick
`some date, even though if the insistence is that Activision
`has to go first, then it's a slightly risky thing to slot
`that into the week where I already have another trial
`scheduled, because then you risk the dominoes falling again.
`MR. ENZMINGER: Right.
`So, Mr. Andre, do you care who goes first?
`MR. ANDRE: We would like to take them the order
`that we filed them. We would like to have Activision go
`first.
`
`THE COURT: Both sides want Activision to go
`
`first?
`
`MR. ANDRE: Yes.
`MR. ENZMINGER: I don't necessarily know that.
`We've been operating under that assumption.
`MR. ANDRE: We finished all of the expert
`discovery. Everything is done. It's just the way the case
`is scheduled.
`MR. ENZMINGER: That's actually not true. There
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 14 of 22 PageID #: 47144
`14
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`are two expert reports that they are intending to submit
`next week, so that will require another round of expert
`rebuttal reports, sponsor reports, and another round of
`expert depositions.
`THE COURT: All right. Well, in any event, why
`don't you see if you can't find -- well, if it's true that
`both sides want Activision to go first, then I would
`suggest, unless you come up with something better, that you
`put that in the October 29th week, where we at least know
`all the lawyers are available, and come up with one of the
`other trials to be around about November 26th, which would
`give you a month in between, and the third one, you can
`schedule that for some time in early 2019. That would be my
`suggestion.
`
`
`
`MR. ENZMINGER: That would be fine with us, Your
`
`Honor.
`
`MR. ANDRE: Your Honor, we'll talk to the other
`side here and see if we can't work something out.
`THE COURT: Okay. All right.
`Okay. So you come up with the weeks, and I will
`reschedule the pretrial conference for this case.
`I have read the letters relating to Dr. Meyers'
`supplemental report. When I issued an oral order a week
`ago, whenever it was, I had not been aware that this was an
`issue before the Special Master at all. I did, when I read
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 15 of 22 PageID #: 47145
`15
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`the letters, I believe, look at some of the things the
`parties cited about what the Special Master had, and then I
`got a letter, I think, signed by Mr. Blumenfeld saying you
`would be prepared to talk about it today.
`Do you want to talk about it today?
`MR. ENZMINGER: Yes.
`THE COURT: Okay. Well, talk.
`MR. ENZMINGER: Okay. We moved to exclude
`Dr. Meyer on a number of grounds, but primarily on the
`grounds that she used illegally incorrect, an undeniably
`illegally and incorrect hypothetical negotiation date, and
`did no hypothetical negotiation date analysis.
`THE COURT: All right. So I mean, I skimmed
`through the supplemental report and I saw basically, which
`is, I think, what the plaintiff represented in its letters
`more or less, which is there was some kind of in the
`alternative analysis at some earlier point, and that she has
`now said more explicitly whatever it is that she said using
`various dates going back, I think, to 2004.
`MR. ENZMINGER: Except that she hasn't done an
`
`
`
`analysis.
`
`If you look at what she has actually done --
`THE COURT: And all I looked at was the
`supplemental report.
`MR. ENZMINGER: Right. Right. But there's no
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 16 of 22 PageID #: 47146
`16
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`analysis in the supplemental report either.
`What she has done is, she said, I was told to
`
`
`
`use --
`
`THE COURT: Right. I got that part.
`MR. ENZMINGER: Yes. And as far as the earlier
`dates, all she's doing is arithmetic. She's saying, I
`determined the royalty as of May, or March 2015, and if I
`have to use an earlier date because Ms. Lawton is correct,
`then I use a discounting factor to discount the royalty that
`I came up with. And I don't have to change my royalty,
`because under the book of wisdom, the negotiators would know
`all facts at all times.
`That is not the law of the Federal Circuit.
`That is not a hypothetical negotiation date. We're putting
`the parties at the time of the hypothetical negotiation.
`And it's also not the right parties.
`As you said in the oral order, presumably,
`Boeing is the right party, and that's not addressed in her
`supplemental response at all.
`THE COURT: Well, okay. All right. Mr. Andre
`or Ms. Kobialka?
`MS. KOBIALKA: Yes, that's correct. Thank you,
`Your Honor.
`I think they are just trying to reargue what
`they had put in their initial Daubert motion. She had done
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 17 of 22 PageID #: 47147
`17
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`an analysis of different hypothetical negotiation dates.
`She did start with the date of infringement, but throughout
`her report, she notes when the accused products were
`released, the ones that we were talking about, and we have
`specific dates.
`She explicitly set that forth in her
`supplemental report, which comes directly from her original
`report giving the dates of the --
`THE COURT: Is her complete original report, or
`I mean actually, all of her reports, is it in the record
`somewhere?
`
`
`
`MS. KOBIALKA: I believe it's all attached to
`the Daubert/summary judgment motions.
`THE COURT: Okay. Not excerpts, but the whole
`
`thing?
`
`MS. KOBIALKA: I would have to go back and
`double-check. I think a fair bit of it was attached.
`MR. ROVNER: I don't think it's the entire, all
`of the reports in their entirety.
`THE COURT: Right.
`MR. ENZMINGER: I believe we may have attached
`the entire thing.
`MS. KOBIALKA: Do you want me to double-check
`right now? And I'm happy to provide you with a copy, too,
`if you would like.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 18 of 22 PageID #: 47148
`18
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`THE COURT: So presumably, this is, presumably,
`she wrote a report and then she wrote a reply report.
`Now this is the third report, the supplemental
`
`
`
`report.
`
`your order.
`
`Is that how many reports she has written?
`MS. KOBIALKA: Yes. That third one based on
`
`THE COURT: Right. I understood.
`Well, it would be helpful if I had a complete
`copy of opening and the expert report, or opening and reply
`reports, and I don't know so far whether or not they are in
`the record or not, but if they're not, I would like to have
`the entire thing. And if they are, then I would just like
`to have it cited to me exactly where I would find it.
`MS. KOBIALKA: So we'll go ahead and provide
`that to you. I will make sure that's for you in the record.
`We'll cite where it is in the record. If not, we'll submit
`it and give you the citations of her analysis regarding the
`hypothetical negotiation date. I think that should take
`care of it.
`
`THE COURT: All right. Mr. Enzminger, do you
`have anything more to say right now?
`MR. ENZMINGER: On that issue, no, but I would
`request, since we now have a little bit of breathing room,
`perhaps we can set a hearing date for summary judgment, if
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 19 of 22 PageID #: 47149
`19
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`the Court is inclined to have oral argument.
`THE COURT: Unfortunately, I've been tied up for
`awhile, which is the reason why we've been working on the
`summary judgments without argument. However, since I'm
`creating some time here, I think actually, it would be
`helpful to have argument on the motions.
`Let me just see. But it could be in the fairly
`near future.
`Let me see. What is today? Today is April
`the 20th. When I say in the fairly near future, I mean, for
`example, that I could hear argument probably -- hold on a
`minute. I could hear argument on May 17th in either the
`late morning or the early afternoon.
`I could probably actually hear argument on
`May 8th, or I could hear argument on -- or the morning on
`May 21st.
`
`
`
`MR. ANDRE: Your Honor, I am going to weigh on
`this very quickly. I think you can decide these on the
`papers, but if we want to have a hearing, sooner is better.
`One thing I know about these defendants is if
`you give them more time, there will be ten more summary
`judgments filed. There will be a lot more briefing.
`THE COURT: Well, no. The number of filings is
`
`done.
`
`MR. ANDRE: Okay.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 20 of 22 PageID #: 47150
`20
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`MR. ENZMINGER: That's actually not entirely
`correct, because we have one that we have been given leave
`to file.
`
`
`
`THE COURT: What are you talking about?
`MR. ENZMINGER: On term 4 for claim 13 of the
`'344 and '966 patents.
`THE COURT: Oh, I thought that was -- didn't you
`attach whatever it was you --
`MR. ENZMINGER: We did, but then the Court gave
`the other side leave to file new expert reports on that
`claim, which will now require us to evaluate those reports.
`THE COURT: All right. That's a very limited
`issue. I'm not too worried about that.
`MR. ENZMINGER: Okay. The May 17th or May 21st
`dates work for us.
`May 21st is a little bit better, but May 17th
`works as well.
`THE COURT: What about May 8th?
`MR. ENZMINGER: With some personal
`inconvenience, we can make it work, but it's not preferred
`of the three.
`THE COURT: All right. Mr. Andre, what about
`the May 17th?
`MR. ANDRE: I can make the 17th work, Your
`
`Honor.
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 21 of 22 PageID #: 47151
`21
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`THE COURT: All right.
`MR. ANDRE: I have a motion to dismiss hearing
`in San Francisco, but I can probably get someone else to
`jump on that one.
`THE COURT: All right. So how about May 17th.
`Actually, why don't we schedule it for 1:00 o'clock.
`MR. ENZMINGER: Okay.
`THE COURT: And I'm optimistic that sometime
`before we get there, I might be able to issue just a little
`order directing what I'm actually interested in hearing on
`you from, because there's an awful lot of things raised in
`the summary judgment brief that, to put it bluntly, they're
`not sufficiently fleshed out in the summary judgment brief,
`so that one could rule in favor of the proponent. And I
`don't really regard this as an opportunity to put in an
`argument that might have been put in the argument the first
`time. This is more for the acts that are actually developed
`that I think are close, or that I would just like to make
`sure that my understanding of what each side is saying is
`correct.
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`So I anticipate that I will give you some
`indication of what would be useful to me. Okay?
`MR. ENZMINGER: That would be terrific.
`THE COURT: All right. Is there anything else
`you want to talk about this morning?
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`Case 1:16-cv-00453-RGA Document 586 Filed 10/10/18 Page 22 of 22 PageID #: 47152
`22
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`MR. ANDRE: Nothing, Your Honor.
`THE COURT: Okay. All right. Sorry. All
`right. Well, let's do that.
`So we've got argument on May 17th, and just to
`make sure, because my notes are incomplete, you're going to
`check into these trial dates and get back with my staff.
`Right?
`
`MR. ENZMINGER: Yes.
`THE COURT: Okay. All right. Thank you for
`your time this morning.
`MR. ENZMINGER: Thank you.
`(Hearing concluded at 9:33 a.m.)
`- - -
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