Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 1 of 19 PageID #: 51442
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`March 26, 2019
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 2 of 19 PagelD #: 51443
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`TABLE OF CONTENTS
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`Page
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`NATURE AND STAGE OF THE PROCEEDINGS... .eccccsesccteeseeseeteeseeseeeeseceeetereeesesseeseeeenens 1
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`SUMMARY OF ARGUMENTou. cicccecccscescecseseneesecceecnecsecsersecsecaeesenaeeseeseseeeseessessecersnesesseeneenees 1
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`ARGUMENTooo. cccssscsscseesesssesceecssseseesceseaceecseceesseeaeecerscsseaaesesseesecseeesaeesessesessecaesseeeeeaussaeeaeeneens 3
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`A. Ms. Lawton Should be Precluded From Opining that Unaccused Games Are a
`Non-Infringing Alternative 00... ccccssssesscesesesseeseecessceseescecsesseesaesecseeseeasseeesssecsesssaseasenees 3
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`B. Ms. Lawton Should be Precluded From Criticizing Dr. Valerdi’s Cost-Savings
`Estimate... cs eececesscssseeeseeesseeeseesceeeseesecsceessescssecsevscessseeessesseeseseseseeesssssessessseseeesessseeatenaeeass 7
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`1. Ms. Lawtonis not Qualified to Criticize Dr. Valerdi’s Selection of Source
`COde once eeecsecsesceecsseseenecersccsecsssceseessecenecnscaeenseesnessecnesessessecsessessenseseesessecseenesssnetseesacaes 8
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`2. Ms. Lawton lacks foundation and the expertise to opine on the source code
`relevant to the scope of infringeMeNt......... eee eccseeeeeeseeseteeceseeseesseseescsecsceeseessessesatees 12
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`3. Ms. Lawton is Not Qualified to Opine on the Reliability of Galoreth SEER-
`SEM o..cccscscscsscresscsessessecseceeesecscsacseesecseseseceseensessecesceaseasecesessessesseseesseasassaseeeeeeseeeenees 13
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`CONCLUSION000i eceesceecsesseesesscereeseseescescssessessesesseeassecseseeseessessessecaeesessseceaesssseeseseseeseeeseases 15
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 3 of 19 PagelD #: 51444
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`TABLE OF AUTHORITIES
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`Page(s)
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`Federal Cases
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`Bowling v. Hasbro, Inc.,
`No. 05-2298, 2008 WL 717741 (D.R.L. Mar. 17, 2008) .....ccccccccecscesecssesssessereeeseersseseteseeees 6, 7
`
`Daubert v. Merrell Dow Pharms., Inc.,
`S09 U.S. 579 (1993) ecsscccccsccecsesecesecseesecsecesessecsecseesesssssessesssessecsesenssseenscseceaseaessaserseesentes 1,3,5
`
`Elcock v. Kmart Corp.,
`233 F.3d 734 (3rd Cir, 2000) oc cccecscsccsessessesssscsscesesesssseessesesessecsecsseasecsessecsecsesascsecssesseasenesnes 5
`
`Exmark Mfg. Co. v. Briggs & Stratton Power Prods. Grp., LLC,
`No. 8:10CV187, 2016 WL 2772122 (D. Neb. May 11, 2016), vacated in part
`on other grounds, 879 F.3d 1332 (Fed. Cir, 2018) ...ccccccccccscsscssesscsecscesessesscssssecsssssessesecseenses4
`
`Grain Processing Corp. v. American Maize-Products Co.,
`185 F.3d 1341 (Fed. Cir, 1999). ccescesesssseseeseneeseseesesesscsenseneesesessesesesecaseassseaeseesceneseensees4
`
`LaserDynamics v. Quanta Comput., Inc.,
`No. 2:06-CV-348, 2011 WL 197869 (E.D. Tex. Jan. 20, 2011) .oceccccccscssesecseesseeteetteenees 4,6
`
`M2MSols. LLC y. Enfora, Inc.,
`167 F. Supp. 3d 665 (D. Del. 2016)... ec cecscceseeseeseeseceseessesssscessecsecseessseseenscssesssesseeass 11, 13
`
`Mars, Inc. v. Coin Acceptors, Inc.,
`527 F.3d 1359 (Fed. Cir, 2008)... cccccscscescessesceecsecssessesesecseeseesesessececsscseesscsesssensesseseesesecsnes4,7
`
`Masimo Corp. v. Philips Elecs. N. Am. Corp.,
`C.A. No. 09-80-LPS-MPT, 2013 BL 131324, 2013 WL 2178047 (D. Del.
`May 20, 2013)... ceccscsscsssscssesscescescecsesseesenecseeseesseseeesesscserseseesseeesessessesseessesesaceaseeesaeeseease4
`
`MediaTek Inc. v. Freescale Semiconductor, Inc.,
`No.11-cv-5341 YGR, 2014 WL 2854890 (N.D. Cal. June 20, 2014) woo cceecescesesseeseesreeeeee 14
`
`Inre Paoli R.R. Yard PCB Litig.,
`35 F.3d 717 (3d Cir, 1994). oc cccccscsscsscseeseesessessesesseesesscsecsssseesecsscssssesecsessessessessccseseceresssenses 5
`
`Power Integrations, Inc. v. Fairchild Semiconductor Int'l, Inc.,
`711 F.3d 1348 (Fed. Cir, 2013)... cccccsccsssseesesscsseseesessssceescsscseesecsucacesesscnecsessessesssesssecseeeneens 14
`
`Smart Skins LLC vy. Microsoft Corp.,
`No. C15-544-MPJ, 2016 WL 4148091 (W.D. Wash. July 1, 2016)... ccc cccecccseeeeteeneees6
`
`il
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 4 of 19 PagelD #: 51445
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`Other Authorities
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`Federal Rule of Evidence 702.00... cccscssssssesssesseseeseesessesecseescseesesseessescacseseecasesessesaeeacseseesaes passim
`
`ili
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 5 of 19 PagelD #: 51446
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`NATURE AND STAGE OF THE PROCEEDINGS
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`Acceleration Bay served the supplemental damages report of Russell Parr on December
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`7, 2018 (the “Parr Report”). D.I. 633. Activision served the supplemental rebuttal damages
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`report of Catharine Lawton on January 25, 2019 (the “Lawton Supp. Report”). D.I. 635.
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`Pursuant to the Court’s Order and the Parties’ Stipulation and Joint Statement Regarding Case
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`Schedule (D.I. 630), Acceleration Bay hereby movesto exclude the following opinions disclosed
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`in the Lawton Report:
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`(1) Ms. Lawton’s opinion, unsupported by any technical expert or fact witness, that
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`earlier Call of Duty and World of Warcraft games, not at issue in this case, are available as non-
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`infringing alternatives to the accused products and support a de minimis damages award (the
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`“NIA Opinions”); and
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`(2) Criticisms of various aspects of Dr. Valerdi’s 2017 cost-savings analysis that Ms.
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`Lawton offers without support from a technical expert or fact witness, includingcriticizing the
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`source code and functionality that Dr. Valerdi includedin his cost-savings estimate and Dr.
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`Valerdi’s selection and configuration of software cost estimation tools (the “Software Cost
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`Opinions”).
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`|
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`SUMMARY OF ARGUMENT
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`Ms. Lawton’s NIA and Software Cost Opinions should be excluded because they do not
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`satisfy the standards of Federal Rule of Evidence 702 and Daubert. Ms. Lawton does not
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`possessthe “scientific, technical, or other specialized knowledge [that] will help the trier of fact
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`to understand the evidence or to determine a fact in issue,” and the opinionsare not “based on
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`sufficient facts or data” and are not “the product of reliable principles and methods... applied..
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`. to the facts of the case.” Fed. R. Evid. 702; Daubert v. Merrell Dow Pharms., Inc., 509 U.S.
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`579, 589-91 (1993).
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`Ms. Lawtonhas a Bachelor of Science degree in finance and economics. Ex. 1 (Lawton
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`Supp. Report) at Exhibit A.1 She has no technical training and is not qualified to review source
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`code oroffer infringement opinions. Ms. Lawton did not rely on Activision’s technical experts
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`or employees to form the opinionsthat are the subject of this motion, and she never reviewed the
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`source code for the accused products.
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`Despite this, Ms. Lawton contendsthat earlier games in the accused Call of Duty and
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`World of Warcraft franchise are a readily available non-infringing alternative for the accused
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`games, and preclude Acceleration Bay from recovering more than a de minimis reasonable
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`royalty. This NIA Opinion is remarkable and should be excluded because no onein this case has
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`made a determination that these earlier games are non-infringing. Ms. Lawton doesnot rely on
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`any opinion by Activision’s technical experts or even its game designers to identify some feature
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`in these earlier gamesthat renders them non-infringing. Further, Ms. Lawton, on her own,is not
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`qualified to determine if the networks used in these earlier games are suitable for use with the
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`accused products. Thus, there is no basis for Ms. Lawton to opineto the jury that these earlier
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`games are non-infringing alternatives.
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`Ms. Lawtonalso opines on Dr. Valerdi’s estimate of Activision’s cost-savings from
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`infringement through avoiding the cost of developing a non-infringing network. Ms. Lawton
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`should be precluded from offering this opinion because Ms. Lawton is unqualified to provide
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`opinions on software cost estimates. She does not have any experience with providing such
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`estimates, does not know about the tools she is criticizing, does not know or have any relevant
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`knowledge or expertise regarding the inputs to Dr. Valerdi’s estimate, and did not rely on anyone
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`1 All exhibits, unless otherwise noted, are attached to the Declaration of Yuridia Caire submitted
`with this motion.
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`with technical expertise to form her opinion. Therefore, the Software Cost Opinions should be
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`excludedas unreliable, lacking foundation and unhelpfulto the jury.
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`ARGUMENT
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`A.
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`Ms. Lawton Should be Precluded From Opining that Unaccused Games Are
`a Non-Infringing Alternative
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`Ms. Lawton should be precluded from offering the NIA Opinions under Federal Rule of
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`Evidence 702 and Daubert because (1) there is no foundation for her NIA Opinions and (2) she
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`is unqualified to make determinations of infringement. Fed. R. Evid. 702; see also Daubert, 509
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`USS. at 589-91.
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`Ms. Lawton contends that Activision may use earlier gamesin the Call of Duty franchise
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`as a non-infringing alternative for the two Call of Duty games accusedofinfringement: Call of
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`Duty Black: OpsIII and Call of Duty: Advanced Warfare. Ex. 1 (Lawton Supp. Report) at
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`30, 99. Ms. Lawton also contends that Activision may use earlier games in the World of
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`Warcraft franchise as a non-infringing alternative for the World of Warcraft games accused of
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`infringementin this case: Mists of Pandaria, Warlords of Draenor and Legion. Jd Specifically,
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`Ms. Lawton contends that Activision had the option of (1) simply relying “on the networksin the
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`prior versions of World of Warcraft that did not incorporate cross-realm zone technologies, and
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`that are not accused of infringement in this case” and (2) “continuing to use the non-infringing
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`networking that was in use both prior to September 2012 and prior to November 2014”for Call
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`of Duty. Id. at J] 30, 98-100, 342, 586, 738.
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`Ms. Lawton offers no factual basis for the NIA Opinions and should not be permitted to
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`manufacture a non-infringingalternative out of thin air. An alleged non-infringing alternative is
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`*Ms. Lawton admits there is no corresponding purported non-infringing alternative for Destiny
`because there are no earlier gamesin that franchise. Ex. 3 (2019 Lawton Tr.) at 66:14-67:6.
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`only relevant to the determination of a reasonable royalty for patent infringementifit is (1) non-
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`infringing, (2) available at the time of infringement, and (3) is both technically and commercially
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`acceptable. Mars, Inc. v. Coin Acceptors, Inc., 527 F.3d 1359, 1373 (Fed. Cir. 2008) (there was
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`no evidence of an acceptable non-infringing alternative available at time of hypothetical
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`negotiation) (subsequent history omitted); Exmark Mfg. Co. v. Briggs & Stratton PowerProds.
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`Grp., LLC, No. 8:10CV187, 2016 WL 2772122,at *5 (D. Neb. May 11, 2016), vacated in part
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`on other grounds, 879 F.3d 1332 (Fed. Cir. 2018) (excluding evidence of non-infringing
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`alternative in the absence of evidence that “alternatives would have been available at the time of
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`the hypothetical negotiation at issue”); LaserDynamics v. Quanta Comput., Inc., No. 2:06-CV-
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`348, 2011 WL 197869,at *3 (E.D. Tex. Jan. 20, 2011) (citing Grain Processing Corp. v.
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`American Maize-Products Co., 185 F.3d 1341, 1353-54 (Fed. Cir. 1999)).
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`Given Ms. Lawton’s background,she is unqualified to provide a non-infringing
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`alternative opinion in the absence of a foundation to support such an opinion from oneofthe
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`technical experts in the case. See, e.g., Masimo Corp. v. Philips Elecs. N. Am. Corp., C.A. No.
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`09-80-LPS-MPT,2013 BL 131324, 2013 WL 2178047, at *18 (D. Del. May 20, 2013) (finding
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`that the expert is an economist, not a medical professional, and is unqualified to provide an
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`independentopinion on the acceptability, or lack thereof, of certain non-infringing alternatives)
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`(subsequent history omitted). Ms. Lawton also freely admits that she is not qualified to offer
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`technical opinions in this case. Ex. 2 (Lawton 2018 Tr.) at 23:24-25:17; Ex. 3 (2019 Lawton Tr.)
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`at 62:5-11 (Q. Could World of Warcraft operate without the network of servers that’s accused of
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`infringement? A. That’s a technical question. I don’t, I don’t [sic] know the answerto that
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`question”). Without the proper qualifications and expertise, Ms. Lawton’s opinion on alleged
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`alternatives is not based on sufficient facts of data, resulting in an unreliable opinion regarding
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`non-infringing alternatives and the resulting damages opinionof a zero-royalty based on those
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`alternatives. Such an unsupported and unreliable opinion will notaid the trier of fact; ratherit
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`will serve only to confuse and mislead the jury, who would beled to improperly believe Ms.
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`Lawtonhas the expertise to provide an opinion about what is a non-infringing alternative in the
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`first place.
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`Here, no expert has determined that the earlier Call of Duty and World of Warcraft games
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`are non-infringing or, even if they are non-infringing, that they wouldbe a technically acceptable
`replacement for the more advanced networking technology used in the current generation games
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`accused of infringement. Ms. Lawton freely admits that she does not know anything about how
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`these products worked, does not knowifit is a technically suitable non-infringing alternative for
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`any of the accused products, andis not relying on any of Activision’s technical experts to find
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`that these products are suitable non-infringing alternatives. See, e.g., Ex. 3 (2019 Lawton Tr.) at
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`30:17-31:2, 62:5-11; Ex. 2 (Lawton 2018 Tr.) at 23:24-25:17. The Court should not allow Ms.
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`Lawtonto provide such technical opinions for which she is unqualified underthe guise of an
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`economic analysis. See Elcock v. Kmart Corp., 233 F.3d 734, 745-46 (3rd Cir. 2000) (quoting Jn
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`re Paoli R.R. Yard PCB Litig., 35 F.3d 717, 742 (3d Cir. 1994) (quoting Daubert, 509 U.S. at
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`589)).
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`Ms. Lawton’s sole purported basis for her uninformed opinion regarding these non-
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`accused gamesis her “observation” that Acceleration Bay did not accusethese products of
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`infringement. Ex. 1 (Lawton Supp. Report) at § 586; see also e.g., Ex. 3 (2019 Lawton Tr.) at
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`22:4-20 (“My understanding is that the earlier versions of World of Warcraft are not currently
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`accused of infringing. .. so, they are not infringing with respect to the currently asserted
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`claims.”); Ex. 1 (Lawton Supp. Report) at { 586 (“[I]n view of Acceleration Bay’s September
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`2012 date offirst alleged infringement, the range ofalternatives has expanded to include the
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`previous, non-infringing versions of World of Warcraft and Call of Duty.”). However, the fact
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`that Acceleration Bay has not taken a position one wayorthe other on the infringement ofthese
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`earlier games — sold outside the damages window in this case — is not a basisorreliable
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`evidence that the games do notinfringe.
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`Ms. Lawton’s failure to rely on technical foundational evidence forher opinionis
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`especially problematic because Activision bears the burden of production and of proof to
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`establish a non-infringing alternative. Smart Skins LLC v. Microsoft Corp., No. C15-544-MPJ,
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`2016 WL 4148091, at *2 (W.D. Wash. July 1, 2016) (“The relevant case law establishes that
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`Microsoft, the alleged infringer, has the burden of showing that non-infringing alternatives were
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`both available to it and were acceptable to its customers during the damagesperiod.”), citing
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`LaserDynamics, 2011 WL 197869,at *3 (“[defendant] .. . bears the burden of proving that the
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`non-infringing alternatives were ‘available’ to it during the accounting period.”).
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`Ms. Lawton’s NIA Opinions are not based on “sufficient facts or data,” and rather are an
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`ipse dixit conclusion without any support. They should, therefore, be excludedfor failing to
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`meet the threshold of admissibility under Rule 702. Fed. R. Evid. 702. Without a proper basis to
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`conclude that the earlier games are non-infringing, such as a technical analysis showing that the
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`earlier games do not practice one or morelimitations of the asserted claims, Ms. Lawton should
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`not be permitted to give an opinion to the jury that the games are non-infringing. There is a
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`seriousrisk that the jury will credit Ms. Lawton’s baseless opinion simply because she is an
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`experienced expert. “[A] an expert opinion is not admissible whenit is connectedto existing
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`data only by the ipse dixit of an expert.” Bowling v. Hasbro, Inc., No. 05-2298, 2008 WL
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`717741 at *4, 7 (D.R.I. Mar. 17, 2008)(“expert is a conduit of facts and not merely a subjective
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`speculator relying on stature alone”) (citations omitted). A court is not requiredto “take the
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`expert's wordforit.” Jd. Rather, the Court serves “as a gatekeeper in order to ensure, as a
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`condition of admissibility, that the proffered expert testimony rests on a sufficiently trustworthy
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`foundation.” Jd. (citation omitted),
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`Ms. Lawton’s NIA Opinionsare further prejudicial and improper because she uses them
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`to support her infirm claim that Acceleration Bay should only be entitled to de minimis damages.
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`Ms. Lawtonreasonsthat, because these purported non-infringing alternatives are freely available
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`to Activision (which has never been demonstrated), Activision would have no reasonto agree to
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`a meaningful royalty in the hypothetical negotiation with Boeing. Ex. 1 (Lawton Supp. Report)
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`at, e.g., J] 30, 738-743.
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`The Federal Circuit has outright rejected the theory, espoused by Ms. Lawton,that
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`damages can be no greater than the cost of non-infringingalternatives. See, e.g., Mars, Inc., 527
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`F.3d at 1373 (defendant“is wrong as a matter of law to claim that reasonable royalty damages
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`are capped at the cost of implementing the cheapestavailable, acceptable, noninfringing
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`alternative. We have previously considered and rejected such an argument.”)(citation omitted).
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`This is a further ground to preclude Ms. Lawton’s NIA Opinionsascontrary to controlling law.
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`B.
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`Ms. Lawton Should be Precluded From Criticizing Dr. Valerdi’s Cost-
`Savings Estimate
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`In September 2017, Dr. Valerdi provided a conservative estimate of how much building
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`non-infringing networksfor the accused products, to the extent possible, would cost Activision.
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`See D.I. 480, Ex. 71 (Valerdi Report.).
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`Dr. Valerdi is a professor of industrial and systems engineering and wrote one of the
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`leading books on software cost estimation. Jd. at Appendix A, page 3. Dr. Valerdi used
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`Galoreth’s SEER-SEM toolto estimate these costs. /d., Valerdi Rpt. at §5. SEER-SEMis a
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`leadingtool for software cost estimation with an “excellent reputation in the industry to provide
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`high quality cost models that are continuously updated,”and relies on a “knowledge base,” an
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`extensive database of prior software developmentprojects, to estimate the cost and time to build
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`new software. Jd. Dr. Valerdi relied upon his years of expertise in the software cost estimation
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`field, his review of the accused products and the input of the technical experts in the case to
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`select the appropriate inputs to use in developing his cost estimate. Jd. at ¢ 3. The Court denied
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`Activision’s Daubert motion to exclude Dr. Valerdi’s opinions. D.I. 578 at 30-31.
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`Ms. Lawton should be precluded from offering opinionscriticizing Dr. Valerdi’s cost-
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`.
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`savings estimate because she is unqualified to do so andthereis no basis for her opinions. Ms.
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`Lawton admits she is unqualified to estimate the cost of software development, has never
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`reviewed source code, cannot offer technical opinions in this case, and does not rely on any of
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`Activision’s technical experts or fact witnesses to provide her Software Cost Opinions. See, e.g.,
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`Ex. 3 (2019 Lawton Tr.) at 59:21-60:8, 40:4-17 (did not review source code), 30:17-31:2, 62:5-
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`11; Ex. 2 (Lawton 2018 Tr.) at 23:24-25:17. Nonetheless, Ms. Lawton opines on Dr. Valerdi’s
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`selection of source codeas relevantto his estimate (Ex. 1, Lawton Supp. Report at {§] 225-245);
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`the scope of infringement implicated by Dr. Valerdi’s estimate (id. at J] 191, 295-296); and the
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`reliability of the SEER-SEM modelthat Dr. Valerdi relies upon to form his opinion(id. at {
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`202-224),
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`For the reasons discussed below, Acceleration Bay respectfully requests that the Court
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`exclude Ms. Lawton’s Software Cost Opinions.
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`1.
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`Ms. Lawton is not Qualified to Criticize Dr. Valerdi’s Selection of
`Source Code
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`Ms. Lawton’s opinions regarding Dr. Valerdi’s selection of source code should be
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`excluded under Daubert and Fed. R. Evid. 702. One of the inputs to Dr. Valerdi’s estimate is the
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`numberof standard lines of software code that Activision would need to redevelop to create a
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`non-infringing alternative. D.I. 480, Ex. 71 (Valerdi Rpt.) at 95. Ms. Lawton claimsthat she
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`“tested” Dr. Valerdi’s assumptions regarding lines of code by cross-referencing the number of
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`code files that Dr. Valerdi relied upon against the numberofcode files producedin the case for
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`each accused game. She then concluded that Dr. Valerdi was not sufficiently selective in
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`determining the amountof source code that Activision would need to redo. Ex. 1 (Lawton Supp.
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`Report) at. | 226.
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`Ms. Lawton, by her own admission, is unqualified to provide opinions regarding source
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`code. During her deposition, Ms. Lawton concededthat she has never reviewed the source code
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`for the accused products (or any other source code), and that she did not rely on Activision’s
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`technical experts, Activision’s employees, or anyone else to gain an understanding of the source
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`codefiles she criticizes. Ex. 3 (2019 Lawton Tr.) at 39:13-40:17 (confirming the portion of
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`report about the numberoflines of source code is based solely on Ms. Lawton’s opinions and
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`that she did not review source code for any purpose); 52:24-53:3; 53:22-54:1 (Q. Andjust to be
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`clear, you didn’t look at the source code yourself and say this is relevant, this is not relevant? A.
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`No,that’s beyond the scope of my expertise.); 59:21-60:8, 40:4-17 (Ms. Lawton did not review
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`source “for any purpose”). Thus, Ms. Lawton’s Software Cost Opinion is not based on any
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`expertise or specialized knowledge, and is nothing more than pure speculation on herpart.
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`Ms. Lawton’s opinionis further deficient under Fed. R. Evid. 702 and Daubert because
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`she does not have a foundation from her knowledge or from others to support heripse dixit
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`criticisms. Ms. Lawton contends that Dr. Valerdi includedirrelevant source codein his
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`estimate, yet she has no knowledge aboutthe functionality of the source code that Dr. Valerdi
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`included in his estimate. Ex. 3 (Lawton 2019 Tr.) at 42:3-5, 44:18-23, 56:22-57:1 (confirming
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`that she did not know whether the source code relied upon was for the infringing network). Ms.
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`Lawton’s opinion appears to be based on skepticism that Dr. Valerdi and Acceleration Bay
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`identified the relevant portion of the source code, yet she has no basis to conclude that they did
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`not or to disparage their efforts to do just that.
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`Ms. Lawton offers a further unqualified criticism of Dr. Valerdi’s analysis based on her
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`claim that, in his cost estimate, he included files that she suspects are not related to the accused
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`networking functionalities based on the name of the file type or folder. Ex. 1 (Lawton Supp.
`
`Report) at ¶¶ 221-226. For example, Ms. Lawton suggests that Dr. Valerdi should not have
`
`included files from the folders
`
`and
`
`because, based on their names, she
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`does not expect them to relate to networking technology. Id. at ¶ 230(b).
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`This purported opinion is nothing more than bald speculation. When pressed at her
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`deposition, Ms. Lawton admitted that she did not have any real understanding as to the nature of
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`the files based on their file types or the name of the directory they are in, that she did not look at
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`any of the files (and only relied on their names as provided to her in screen shots from an
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`unknown Activision employee), and that she did not confer with any of Activision’s technical
`
`experts or employees who could have looked at the actual functionality of the source code. See,
`
`e.g., Ex. 3 (2019 Lawton Tr.) at 58:17-20 (Q. So, you don't know one way or the other if
`
`
`
`files relate to the infringement in this case? A. Right. I don't know.), 61:7-62:4 (Ms.
`
`Lawton admitting she never reviewed the
`
`code and does not know if the
`
`code relates to networking functionality). Thus, Ms. Lawton’s opinion is based on
`
`pure speculation.
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 15 of 19 PagelD #: 51456
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`Ms. Lawton eventually admitted during her deposition that she has no foundation for any
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`of her opinionsrelating to the relevance of the source code that Dr. Valerdi and Acceleration
`
`Bay’s infringement experts selected for inclusion in his analysis:
`
`Q. But do you have an understandingasto if these files relate or do
`not relate to the accused networking technology?
`
`A. No.
`
`Q. Did you discuss this issue with any technical experts or
`Activision employees?
`
`A. No.
`
`Q. Did you review the source code?
`
`A. No.
`
`Q. Would your answers be the same for the discussion of the Call
`of Duty source codefiles?
`
`A. Your last series of questions as to whether I reviewed source
`code, whether I talk to Activision or technical experts? ... [M]y
`answers would be the same.
`
`Id. at 59:17-60:8.
`
`Given Ms. Lawton’s lack of specialized knowledgein this technical area, and the
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`complete lack of foundation her opinions are unreliable and will not help the trier of fact. Ms.
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`Lawton’s proposed testimony on this subject area does not pass muster under Daubert or Rule
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`702, and she should not be permitted to mislead the jury with these unsupported and unqualified
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`opinions. See, e.g., Fed. R. Evid. 702; M2M Sols. LLC v. Enfora, Inc., 167 F. Supp. 3d 665, 678
`
`(D. Del. 2016) (excluding expert opinion that invited the court to “blindly accept the
`
`unsubstantiated conclusions of its experts... .”).
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`11
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 16 of 19 PagelD #: 51457
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`2.
`
`Ms. Lawton lacks foundation and the expertise to opine on the source
`code relevant to the scope of infringement
`
`Ms. Lawton should not be permitted to opine that Dr. Valerdi’s estimate is based on
`
`source code supposedly beyond the scope of infringementat issue in this case. Ms. Lawton
`
`contends that Dr. Valerdi’s estimate overstates the cost of developing a design around becauseit
`
`is not based on the numberofasserted patents. See, e.g., Ex. 1 (Lawton Supp. Report) at §§ 191,
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`225-228, 295-296.
`
`Ms. Lawton provides no basis or explanation for why Dr. Valerdi’s cost estimate for
`
`World of Warcraft does not accurately accountfor the patented technology of the asserted
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`patents. See id. Ms. Lawton did not confer with any of the technical experts or games
`developers, and ignores that the numberofpatents is not the primary driver ofthe cost ofthe
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`non-infringing alternative. Rather, the challenge of developing a non-infringing alternative is
`
`avoiding the infringing technologythatis critical to the accused games. For example, a key to
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`developing a non-infringing alternative would be reworking the World of Warcraft network to
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`operate without using an m-regular, incomplete network. Ex. 4 (Bims Opening Report) at {| 76.
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`Ms. Lawton does not provide any evidence, andis not qualified to argue to the jury, that the cost
`
`to do so would vary based on the numberof patents at issue.
`
`As discussed above, Ms. Lawtonis not qualified to make such a determination because
`
`she is not a technical expert, is not a software cost expert, does not know how the accused
`
`products operate and doesnot have an understanding as to how that functionality implicates the
`
`asserted patents. Indeed, Ms. Lawtonappearsto be operating under the incorrect assumption
`
`that “the salient aspect of the Patents-in-Suit” is an “m-connected” network. Ex. 3 (Lawton 2019
`
`Tr.) at 80:11-81:19. That elementis not a requirementofany of the claimspresently asserted
`
`against Activision. Instead, the asserted claimsof the ‘344, ‘966, ‘069 and ‘147 patents require
`
`12
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 17 of 19 PagelD #: 51458
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`an m-regular network. When pressed to explain her incorrect view, Ms. Lawton admitted that
`
`she did not know the difference between m-connected and m-regular network, did not know
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`which was required in the claims, and could not answer these questions because they are
`
`“technical.” Id.
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`Thus, Ms. Lawtonis not qualified to, and should not be allowed to, opine on the scope of
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`infringement implicated by Dr. Valerdi’s cost estimate. M2M Sols. LLC, 167 F. Supp. 3d at 678.
`
`3.
`
`Ms. Lawton is Not Qualified to Opine on the Reliability of Galoreth
`SEER-SEM
`
`Ms. Lawton should be precluded from offering opinions regarding the reliability of the
`
`software that Dr. Valerdi used in his cost-savings analysis. See Ex. 1 (Lawton Supp. Report) at
`
`q{ 206-220.
`
`Dr. Valerdi reachedhis cost-savings estimate using the Galoreth SEER-SEM software
`
`tool. Id. at ¢ 202. SEER-SEM is an acronym for “System Evaluation and Estimation of
`
`Resources-Software Estimation Model.” Jd. | 203. SEER-SEM is a leading tool for software
`
`cost-estimation, and even Activision’s non-infringement expert Dr. Macedonia admits, based on
`
`his personal experience, that the “standard lines of code” methodology used by SEER-SEMis
`
`the leading form of software cost estimation used by the United States government. Ex. 5
`
`(Macedonia Tr.) at 251:10-253:4.
`
`Ms. Lawton, despite having no technical expertise and no experience with the SEER-
`
`SEM program or software cost estimation, opines that “Dr. Valerdi does not establish the
`
`reliability of the Galoreth SEER-SEM cost model” because he fails to sufficiently consider the
`
`error rate of SEER-SEM and SEER-SEM maybeinferior to other software cost estimation tools.
`
`Ms. Lawton also disagrees, without basis, that the use of such softwareis “the most systematic
`
`and reliable wayto arrive at a cost estimate” for software, and questionsthe fit of the SEER-
`
`13
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 18 of 19 PagelD #: 51459
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`SEM database to the facts of this case and the calibration of its data. See Ex. 1 (Lawton Supp.
`
`Report) at J¥ 204, 206-220.
`
`Indeed, during her deposition, Ms. Lawton backtracked and admitted that she has no
`
`basis to doubt Dr. Valerdi’s analysis as to which tool was more appropriate to use for his cost-
`
`estimate model or to question that the software was properly calibrated. Ex. 3 (2019 Lawton Tr.)
`
`at 37:10-14 (Q. Do you doubt Doctor Valerdi’s analysis as to which tool was more appropriate?
`
`A. I don’t have anybasisto, to [sic] respond to that.), 76:2-25 (“Q: Do you have any reason to
`believe that Galorath does not frequently calibrate its model? A. I don’t know the specifics of
`
`what they do to calibrate their model.”). In effect, Ms. Lawton intends to provide an opinion to
`
`the jury that she is skeptical that Dr. Valerdi, a leading expert in the software-cost estimation
`
`field, selected an appropriate tool for his analysis. That opinion, however, is not based on
`
`anything but her pure speculation. She does not have any relevant expertise or knowledge, much
`
`less reason or basis, to assert that his selection was improper.
`
`Thus, Ms. Lawton’s opinions on this issue should be excluded as unreliable, unsupported,
`
`and unhelpful to the jury’s evaluation of Dr. Valerdi’s opinions. See e.g., Power Integrations,
`
`Inc. v. Fairchild SemiconductorInt'l, Inc., 711 F.3d 1348, 1373 (Fed. Cir. 2013)(holding that
`
`“the data cannot be derived from a manifestly unreliable source’’) (citations omitted); see also
`
`MediaTek Inc. v. Freescale Semiconductor, Inc., No.11-cv-5341 YGR, 2014 WL 2854890, at *5
`
`(N.D. Cal. June 20, 2014) (citing Power Integrations, as properly excluding expert opinions
`“where the source ofthe expert’s data was unclear and his estimates were based upon improper
`
`assumptions about the accused products themselves”).
`
`14
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`Case 1:16-cv-00453-RGA Document 655 Filed 03/26/19 Page 19 of 19 PagelD #: 51460
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`CONCLUSION
`
`For the reasonsset forth above, the Court should grant Acceleration Bay’s motion to
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`exclude Lawton’s proposed Non-Infringing Alternative and Software Cost Estimate opinions.
`
`POTTER ANDERSON & CORROON LLP
`
`By: /s/ Phili