Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 1 of 27 PageID #: 12598
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
`
`VB ASSETS, LLC,
`
`Plaintiff,
`
`v.
`
`AMAZON.COM SERVICES LLC,
`
`Defendant.
`
`REDACTED PUBLIC VERSION
`C.A. No. 1:19-cv-01410-MN
`
`DEFENDANT’S ANSWERING BRIEF IN OPPOSITION TO
`MOTIONS FOR AN ONGOING ROYALTY, PRE- AND POST-
`JUDGMENT INTEREST, AND ENHANCED DAMAGES
`
`Steven J. Balick (#2114)
`sbalick@ashbygeddes.com
`Andrew C. Mayo (#5207)
`amayo@ashbygeddes.com
`ASHBY & GEDDES, P.A.
`500 Delaware Avenue, 8th Floor
`P.O. Box 1150
`Wilmington, DE 19899
`(302) 654-1888
`
`Attorneys for Defendant
`Amazon.com Services LLC
`
`Of counsel:
`
`J. David Hadden, CSB No. 176148
`dhadden@fenwick.com
`Saina S. Shamilov, CSB No. 215636
`sshamilov@fenwick.com
`Ravi R. Ranganath, CSB No. 272981
`rranganath@fenwick.com
`Vigen Salmastlian, CSB No. 276846
`vsalmastlian@fenwick.com
`FENWICK & WEST LLP
`801 California Street
`Mountain View, CA 94041
`(650) 988-8500
`
`January 3, 2023
`
`{01972910;v1 }
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 2 of 27 PageID #: 12599
`
`
`TABLE OF CONTENTS
`
`Page
`
`A.
`
`VB Assets is not entitled to enhanced damages. ..................................................................... 1
`
`1.
`
`2.
`
`3.
`
`4.
`
`Amazon’s pending Rule 50(b) motion should moot the enhanced damages
`request. .......................................................................................................................... 3
`
`Amazon’s pre-suit conduct does not warrant enhancement. ...................................... 3
`
`Amazon’s litigation conduct does not warrant enhancement. .................................... 5
`
`No other factors warrant enhancement. ..................................................................... 11
`
`The Court should deny an ongoing royalty. ........................................................................... 14
`
`The Court should deny pre- and post-judgment interest. ...................................................... 19
`
`B.
`
`C.
`
`
`
`
`
`{01972910;v1 }
`
`i
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 3 of 27 PageID #: 12600
`
`
`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`CASES
`Amazon.com, Inc. v. VB Assets, LLC,
`IPR2020-01346, 2022 WL 320531 (PTAB Feb. 1, 2022) .........................................................6
`Apple, Inc. v. Samsung Elecs. Co.,
`No. 12-cv-630, 2014 WL 6687122 (N.D. Cal. Nov. 25, 2014) ...............................................15
`ArcherDX LLC v. Qiagen Sciences, LLC,
`No. 18-1019, 2022 WL 4597877 (D. Del. Sep. 30, 2022) .................................................11, 15
`Canon, Inc. v. Color Imaging, Inc.,
`292 F. Supp. 3d 1357 (N.D. Ga. 2018) ....................................................................................13
`CloudofChange, LLC v. NCR Corp.,
`No. 6:19-cv-513-ADA, 2021 WL 12093335 (W.D. Tex. Dec. 7, 2021) ...................................8
`Crystal Semiconductor Corp. v. TriTech Microelectronics Int'l, Inc.,
`246 F.3d 1336 (Fed. Cir. 2001)................................................................................................19
`Del Mar Avionics v. Quinton Inst. Co.,
`836 F.2d 1320 (Fed. Cir. 1987)................................................................................................13
`Delta–X v. Baker Hughes Prod. Tools,
`984 F.2d 410 (Fed.Cir.1993)......................................................................................................5
`EagleView Techs., Inc. v Xactware Sols., Inc.,
`522 F. Supp 3d. 40 (D.N.J. 2021) ........................................................................................4, 13
`Edwards Lifescience AG v. CoreValve, Inc.,
`No. 08-91-GMS, 2011 WL 446203 (D. Del. Feb. 7, 2011) .....................................................11
`Energy Transp. Group, Inc. v. Sonic Innovations, Inc.,
`No. 05-422 (GMS), 2011 WL 2222066 (D. Del. June 7, 2011) ................................................5
`Ericsson, Inc. v. D-Link Sys., Inc.,
`773 F.3d 1201 (Fed. Cir. 2014)................................................................................................18
`Gustafson, Inc. v. Intersystems Indus. Prods., Inc.,
`897 F.2d 508 (Fed. Cir. 1990)..................................................................................................13
`Halo Elecs., Inc. v. Pulse Elecs., Inc.,
`579 U.S. 93 (2016) ...........................................................................................................1, 2, 10
`Idenix Pharm. LLC v. Gilead Sciences, Inc.,
`No. 11-2686, 271 F. Supp. 3d 694 (D. Del. 2017) ........................................................... passim
`Kaneka Corp. v. SKC Kolon PI, Inc.,
`198 F. Supp. 3d 1089 (C.D. Cal. 2016) ...................................................................................20
`
`{01972910;v1 }
`
`ii
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 4 of 27 PageID #: 12601
`
`
`
`
`TABLE OF AUTHORITIES
`(Continued)
`
`Page(s)
`
`Liquid Dynamics Corp. v. Vaughan Co.,
`449 F.3d 1209 (Fed. Cir. 2006)..................................................................................................2
`Lucent Techs., Inc. v Newbridge Nets. Corp.,
`168 F. Supp. 2d 269 (D. Del. 2001) .........................................................................................13
`MHL Customs, Inc. v. Waydoo USA, Inc.
`No. 21-0091, 2023 WL 5805889 (D. Del. Sep. 7 2023) ..............................................11, 14, 15
`Mondis Tech. Ltd. v. LG Elecs., Inc.,
`No. 15-4431 (SRC), 2023 WL 3749992 (D.N.J. June 1, 2023) ...........................................4, 11
`nCube Corp. v. SeaChange Int’l., Inc.,
`313 F. Supp. 2d 361 (D. Del. 2004) ...................................................................................12, 13
`Nox Med. Ehf. v. Naus Neurology Inc.,
`No. 15-cv-00709, 2018 WL 6427686 (D. Del. Dec. 7, 2018) ...................................................3
`Paice LLC v. Toyota Motor Corp.,
`504 F.3d 1293 (Fed. Cir. 2007)................................................................................................15
`Presidio Components, Inc. v. Am. Tech. Ceramics Corp.,
`875 F.3d 1369 (Fed. Cir. 2017)..................................................................................................2
`Prism Techs. LLC v. Sprint Spectrum L.P.,
`849 F.3d 1360 (Fed. Cir. 2017)..........................................................................................18, 19
`PureWick Corp. v. Sage Prods., LLC,
`No. 19-1508, 2023 WL2734418 (D. Del. Mar. 31, 2023) .......................................1, 14, 15, 18
`Read Corp. v. Portec, Inc.,
`970 F.2d 816 (Fed. Cir. 1992)..........................................................................................1, 2, 11
`Siemens Mobility, Inc. v. Westinghouse Air Brake Techs. Corp.,
`No. 16-284-LPS, 2019 WL 3240521 (D. Del. July 18, 2019) .............................................5, 11
`Sprint Commc’ns Co. L.P. v. Time Warner Cable, Inc.,
`2017 WL 978107 (D. Kan. Mar. 14, 2017) ...............................................................................2
`SRI Int’l, Inc. v. Cisco Systems, Inc.,
`254 F. Supp. 3d 680 (D. Del. 2017) .........................................................................................12
`Sunoco Partners Marketing & Terminals L.P. v. Powder Springs Logistics, LLC,
`No. 17-1390-RGA, 2022 WL 3973499 (D. Del. Aug. 31, 2022) ..................................5, 11, 12
`Telecordia Techs., Inc. v. Cisco Sys., Inc.,
`612 F.3d 1365 (Fed. Cir. 2010)................................................................................................15
`
`{01972910;v1 }
`
`iii
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 5 of 27 PageID #: 12602
`
`
`
`
`TABLE OF AUTHORITIES
`(Continued)
`
`Page(s)
`
`TiVo Inc. v. Echostar Corp.,
`646 F.3d 869 (Fed. Cir. 2011) (en banc) ..................................................................................19
`TruePosition Inc. v. Andrew Corp.,
`611 F. Supp. 2d 400 (D. Del. 2009) .........................................................................................14
`Univ. of Rochester v. G.D. Searle & Co.,
`358 F.3d 916 (2004) .................................................................................................................10
`Vectura Ltd. v. GlaxoSmithKline LLC,
`No. 16-638-RGA, 2019 WL 4346502 (D. Del. Sept. 12, 2019) ...................................... passim
`Wash World Inc. v Belanger Inc.,
`2023 WL 3216648 (E.D. Wis. Mar. 30, 2023) ........................................................................11
`Whitserve, LLC v. Computer Packages, Inc.,
`694 F.3d 10 (Fed. Cir. 2012)....................................................................................................14
`XpertUniverse, Inc. v. Cisco Sys., Inc.,
`No. CV 09-157-RGA, 2013 WL 6118447 (D. Del. Nov. 20, 2013), aff'd, 597 F.
`App’x 630 (Fed. Cir. 2015) .....................................................................................................19
`XY, LLC v. Trans Ova Genetics, L.C.,
`890 F.3d 1282 (Fed. Cir. 2018)................................................................................................15
`RULES
`L.R. 7.1.3(c)(2) ..............................................................................................................................15
`
`
`
`{01972910;v1 }
`
`iv
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 6 of 27 PageID #: 12603
`
`
`
`VB Assets seeks an unwarranted series of enhancements to the damages award that the Court
`
`should deny, as set forth below.
`
`A.
`
`VB Assets is not entitled to enhanced damages.
`
`After presiding over this case for five years, and after having heard all testimony and
`
`evidence offered at trial, the Court made the following observation about enhanced damages:
`
`I’ll tell you that I don’t think a finding on willfulness on the facts that I have seen is
`really going to get the plaintiff anything, but I suppose we’ll deal with that if we have
`to.
`
`(Nov. 7, 2023 Hrg. Tr. at 6:11–12.) VB Assets now asks the Court to award it more than $23 million
`
`as what it calls a “modest” enhancement, which would make a “negligible difference” because
`
`Amazon is so successful, yet without which the $46 million already awarded would supposedly have
`
`no “meaning.” (Op. Br. at 5, 16–17.) While VB Assets’ motion has forced the Court to address this
`
`issue, nothing argued gives reason for the Court to revise its prior assessment.
`
`“Whether to award enhanced damages is committed to the [c]ourt’s discretion.” PureWick
`
`Corp. v. Sage Prods., LLC, No. 19-1508,, 2023 WL2734418, at *13 (D. Del. Mar. 31, 2023) (citing
`
`Halo Elecs., Inc. v. Pulse Elecs., Inc., 579 U.S. 93, 103 (2016)). But the Supreme Court has made
`
`clear that enhanced damages are “designed as a ‘punitive’ or ‘vindictive’ sanction” that is “generally
`
`reserved for egregious cases of culpable behavior.” Id. (quoting Halo, 579 U.S. at 103–04). “The
`
`sort of conduct warranting enhanced damages has been variously described . . . as willful, wanton,
`
`malicious, bad-faith, deliberate, consciously wrongful, flagrant, or—indeed—characteristic of a
`
`pirate,” and are not appropriate in “garden-variety cases.” Id. (alteration in original) (quoting Halo,
`
`at 109). Although not required, the Court may still consider the Read factors1 to guide its analysis
`
`
`1 See Read Corp. v. Portec, Inc., 970 F.2d 816, 827 (Fed. Cir. 1992). The factors include (1)
`whether the infringer deliberately copied the ideas or design of another; (2) whether the infringer,
`when it knew of the other’s patent protection, investigated the scope of the patent and formed a
`good-faith belief that it was invalid or that it was not infringed; (3) the infringer’s behavior as a
`
`{01972910;v1 }
`
`1
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 7 of 27 PageID #: 12604
`
`
`
`of whether this standard is met. See Presidio Components, Inc. v. Am. Tech. Ceramics Corp., 875
`
`F.3d 1369, 1382 (Fed. Cir. 2017). VB Assets has the burden to prove entitlement to enhanced
`
`damages. Halo, 579 U.S. at 94.
`
`VB Assets’ motion turns the record upside down in its attempt to meet this burden. The
`
`evidence at trial was that neither VB Assets nor its predecessor VoiceBox ever leveled a charge of
`
`infringement against Amazon before filing this suit five years after Alexa had launched and already
`
`become massively successful. Instead, during that period they sought to partner with Amazon and
`
`to copy Amazon’s Echo speaker. With respect to the alleged infringement, they sat silent. Moreover,
`
`after stipulating to an order from this Court that it would not offer evidence that Amazon copied
`
`anything from either VoiceBox or the asserted patents (D.I. 259), VB Assets now argues that it did
`
`exactly that. Specifically, VB Assets asserts that it somehow—in disregard of the Court’s order—
`
`proved at trial that Amazon had not only engaged in such copying but did so to inflict commercial
`
`harm on VoiceBox. There is no such record. Nor is enhancement warranted by the conduct of the
`
`litigation. Amazon presented meritorious defenses and substantiated them with extensive evidence
`
`and testimony. It should still prevail, at the very least, on its noninfringement defenses. (See D.I.
`
`299.) And VB Assets dictated the expansive scope of this case by asserting 201 claims—more than
`
`it could hope to present in 20 trials let alone one—and its persistent refusal to narrow the case
`
`appropriately. The Court should deny the motion.
`
`
`party to the litigation; (4) defendant’s size and financial condition; (5) the closeness of the case;
`(6) duration of the defendant’s misconduct; (7) remedial action by the defendant; (8) defendant’s
`motivation for harm; and (9) whether defendant attempted to conceal its misconduct. See Liquid
`Dynamics Corp. v. Vaughan Co., 449 F.3d 1209, 1225 (Fed. Cir. 2006) (citing Read, 970 F.2d at
`826–27). But “[e]ven where several of the Read factors favor enhancement, it remains within the
`Court’s discretion to decline to enhance damages.” Idenix Pharm. LLC v. Gilead Sciences, Inc.,
`No. 11-2686, 271 F. Supp. 3d 694, 699 n.7 (D. Del. 2017) (citing Sprint Commc’ns Co. L.P. v.
`Time Warner Cable, Inc., 2017 WL 978107, at *13–14 (D. Kan. Mar. 14, 2017)).
`
`{01972910;v1 }
`
`2
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 8 of 27 PageID #: 12605
`
`
`
`1.
`
`Amazon’s pending Rule 50(b) motion should moot the enhanced
`damages request.
`
`The Court should moot the motion by granting Amazon’s motion for judgment as a matter
`
`of law on at least the issues of non-infringement and no willfulness. (D.I. 299.) As Amazon’s motion
`
`describes, VB Assets’ trial presentation omitted necessary claim limitations and attempted to “infer”
`
`infringement of others in a manner expressly proscribed by the Federal Circuit. Moreover, VB
`
`Assets did not present substantial evidence of willfulness.2 Because a “jury’s finding of willful
`
`infringement is a prerequisite to enhancement of damages,” Nox Med. Ehf. v. Naus Neurology Inc.,
`
`No. 15-cv-00709, 2018 WL 6427686, at *1 (D. Del. Dec. 7, 2018), granting the motion on either
`
`ground moots VB Assets’ request.
`
`2.
`
`Amazon’s pre-suit conduct does not warrant enhancement.
`
`Even assuming the willfulness finding stands, Amazon’s pre-suit conduct does not warrant
`
`enhancing damages. VB Assets’ principal, Mr. Mike Kennewick, admitted that Amazon had no
`
`notice of any charge of infringement until VB Assets filed suit in 2019:
`
`Q. And VoiceBox never told Amazon that it was infringing its patents; correct?
`A. As far as I know, that’s probably true.
`Q. And in fact, VoiceBox never told [Amazon] it was infringing its patents until after
`VB Assets filed this lawsuit in 2019; right?
`A. That’s correct.
`
`(Trial Tr. at 225:5–11.) That fact weighs much more heavily against enhancement than in the
`
`“garden variety” case, because here, Amazon launched Alexa in 2014 and VB Assets was not only
`
`aware of that fact but had numerous opportunities to assert infringement thereafter including
`
`correspondence with Jeff Bezos and a second face-to-face meeting with Amazon personnel. (Id. at
`
`
`2 VB Assets’ purported evidence of pre-suit willfulness, for example, is that Amazon met with
`its predecessor VoiceBox in 2011 and 2017 and thus “knew about the patents.” (See Op. Br. at
`19–20; Trial Tr. at 160:20-161:19, 179:3–10.) But willful infringement cannot be found “merely
`because Amazon knew about the asserted patents, without more.” (Final Jury Ins. at 11); see also
`Idenix, 271 F. Supp. 3d at 697.
`
`{01972910;v1 }
`
`3
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 9 of 27 PageID #: 12606
`
`
`
`225:1–7; 224:18–25; 226:9-20; see also id. at 224:10–17 (“Q: Nowhere in this e-mail with Mr.
`
`Boom[s] to Amazon, do you say Amazon is infringing our patents, do you? A. No, I don’t.”).) The
`
`lack of a pre-suit charge of infringement supports denying enhancement even without such facts.
`
`See, e.g., Mondis Tech. Ltd. v. LG Elecs., Inc., No. 15-4431 (SRC), 2023 WL 3749992, at *8 (D.N.J.
`
`June 1, 2023). Here, that VB Assets regularly engaged Amazon in conversation about Alexa without
`
`ever claiming infringement should preclude it.3
`
`The thrust of VB Assets’ argument about pre-suit conduct is thus that Amazon copied
`
`VoiceBox. (Op. Br. at 19–20 (Factor 1).) But VB Assets’ expert admitted as late as the expert
`
`discovery period that he had no such evidence. (Declaration of Jeffrey Ware (“Ware Decl.”) Ex. 1
`
`at 410:15–411:4.) And at trial, there was no such evidence either, as the Court specifically ordered
`
`that it could not be presented:
`
`VB Assets will not present any argument, evidence, or testimony that Amazon copied
`any VB Assets or VoiceBox product. VB Assets will also not elicit any testimony
`from its fact or expert witnesses that (i) Amazon copied any embodiments or features
`from the asserted patents into the accused product or that (ii) Amazon copied ideas
`or designs that VB Assets or VoiceBox allegedly disclosed to Amazon into the
`accused product.
`
`(D.I. 259 at 2.) That VB Assets now suggests it proved to the jury that Amazon stole its technology
`
`with a goal to “subsume VoiceBox’s business by building out [its] exact products” is unsupported
`
`in the record. (Op. Br. at 19.) The record shows that Amazon met with VoiceBox in 2011 seeking
`
`a partnership which, upon review of VoiceBox’s technology, did not meet Amazon’s vision because
`
`
`3 VB Assets (Op. Br. at 10–11) cites EagleView Techs., Inc. v Xactware Sols., Inc., 522 F.
`Supp 3d. 40 (D.N.J. 2021) in support of an argument that Amazon lacked a good faith belief in
`noninfringement (Factor 2). That case bears no resemblance to the facts here, as the EagleView
`plaintiff affirmatively gave notice of infringement (id. at 49–50), and the defendant responded in
`the case by offering that did not “feel” that it was infringing because of an opinion of counsel that
`it had refused to disclose. Id. Amazon had no such notice nor any reason to suspect such given
`VoiceBox’s total silence on the subject throughout multiple meetings and correspondence over the
`course of years. (Trial Tr. at 225:5–11, 224:18–21, 226:9–20; see also id. at 224:10–17; PTX065).
`
`{01972910;v1 }
`
`4
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 10 of 27 PageID #: 12607
`
`
`
`it relied on technology that could not scale. (Trial Tr. at 609:10–615:8.) In fact, the evidence at trial
`
`was that VoiceBox copied Amazon. VoiceBox never sold a single “Cybermind” speaker and moved
`
`away from developing it in the early 2000s. (Trial Tr. at 187:5–188:19). But after the Alexa launch,
`
`VoiceBox started a new speaker project that its own internal communications describe as
`
`“construct[ing] a device that imitates the Amazon Echo” with a microphone array “nearly identical
`
`to the Amazon Echo’s array,” that VoiceBox believed “to be just as reliable as the Amazon Echo for
`
`locating the active talker.” (Trial Tr. at 208:10–210:2, DTX-0058; see also id. at 200:2–201:10,
`
`196:11–200:1, DTX-0188; id. at 210:3–212:17, DTX-0183.)
`
`3.
`
`Amazon’s litigation conduct does not warrant enhancement.
`
`Amazon’s litigation conduct does not support enhancement of damages—and VB Assets’
`
`motion omits the relevant context that so demonstrates. The defendant “may generally avoid
`
`enhanced damages with a meritorious good faith defense and a substantial challenge to
`
`infringement.” Energy Transp. Group, Inc. v. Sonic Innovations, Inc., No. 05-422 (GMS), 2011 WL
`
`2222066, at *16 (D. Del. June 7, 2011) (quoting Delta–X v. Baker Hughes Prod. Tools, 984 F.2d
`
`410, 413 (Fed.Cir.1993)). To warrant enhancement, the defenses instead must be “so weak as to be
`
`meritless.” See Vectura Ltd. v. GlaxoSmithKline LLC, No. 16-638-RGA, 2019 WL 4346502, at *4
`
`(D. Del. Sept. 12, 2019). And that is not the case where the defendant “presented considerable
`
`evidence in support of [its] assertions of non-infringement and invalidity.” Sunoco Partners
`
`Marketing & Terminals L.P. v. Powder Springs Logistics, LLC, No. 17-1390-RGA, 2022 WL
`
`3973499, at *2 (D. Del. Aug. 31, 2022) (citing Siemens Mobility, Inc. v. Westinghouse Air Brake
`
`Techs. Corp., No. 16-284-LPS, 2019 WL 3240521, at *9 (D. Del. July 18, 2019)).
`
`Amazon’s pending JMOL points to ample evidence that Amazon presented meritorious
`
`defenses. (See D.I. 299.) For example, Dr. Polish never even attempted to show how Alexa
`
`processes any single utterance in the manner required by the claims (e.g., in a way that met each of
`
`{01972910;v1 }
`
`5
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 11 of 27 PageID #: 12608
`
`
`
`the steps in asserted claim 13 of the ’681 patent). (Trial Tr. at 392:21–394:2.) Nor did Dr. Polish
`
`ever identify a “predetermined event” in response to which the claimed adaptive misrecognition
`
`engine of claim 40 of the ’176 patent determines that words or phrases were interpreted incorrectly.
`
`(Id. at 410:12–15.) The record is replete with such failures in VB Assets’ infringement case, which
`
`Amazon called out at every stage of the case, including at trial. (See, e.g., D.I. at 11–13, Trial Tr. at
`
`406:21–408:14, 409:14–15, 413:10–414:19 (skipping claims and limitations); id. at 347:11–22,
`
`350:1–10, 350:14–20, 360:13–23, 361:15–362:14, 406:1–8, 407:25–408:14 (conclusory testimony);
`
`id. at 338:16–339:12, 346:23–349:3, 350:1–20, 358:1–13, 394:22–395:3, 411:13–16, 411:25–
`
`412:21, PDX3-10 (providing insufficient analysis and speculative opinion). The Court also stated
`
`about the Section 101 defense that “I do understand the concerns that Defendants have about some
`
`of these claims,” and ruled three such claims abstract on the pleadings. (D.I. 57 at 13, 15-16.) And
`
`the Court granted Amazon’s motion to exclude VB Assets’ damages opinions, reducing VB Assets’
`
`claim from $143.5 million to $46.7 million. (Sept. 27, 2023 Hrg. Tr. at 4:3–9; D.I. 238.) VB Assets
`
`makes no showing whatsoever that this defense was “frivolous” or “meritless,” and focuses instead
`
`on other litigation conduct. (See Op. Br. at 11-16 (Factor 3).) That itself should end the Court’s
`
`inquiry.
`
`Scope of the case. VB Assets dictated the scope of the case at each stage, and its choices to
`
`foist additional work on Amazon and the Court should not now become a basis to award it $23
`
`million. VB Assets originally asserted 201 claims across six patents, more than it could ever hope
`
`to bring to trial. (D.I. 58; Ware Decl. Ex. 2 at 2 (listing asserted claims in Amazon’s invalidity
`
`contentions).) It engaged in no voluntary narrowing whatsoever until nearly two and half years into
`
`the case, in May 2022, and even then, it did so only because Amazon had successfully challenged
`
`the ’049 patent in an IPR. See Amazon.com, Inc. v. VB Assets, LLC, IPR2020-01346, 2022 WL
`
`{01972910;v1 }
`
`6
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 12 of 27 PageID #: 12609
`
`
`
`320531, at *16 (PTAB Feb. 1, 2022). The same month, as the parties approached the opening expert
`
`report deadline, VB Assets refused Amazon’s proposal to narrow the case to 30 asserted claims and
`
`four section 102/103 invalidity grounds per claim. (Ware Decl. Ex. 3.)
`
`And when the parties did agree to a lesser reduction of 45 asserted claims and six 102/103
`
`grounds per claim the next month, see D.I. 143 at 2, VB Assets gamed its reduction to keep in play
`
`claims with multiple dependencies, thus effectively retaining both the asserted claims and the
`
`dropped claims. In other words, the case still included all the issues from the dropped independent
`
`claims and therefore remained just as complicated as before as far as preparation of Amazon’s
`
`defenses. (Ware Decl. Ex. 4.)4 VB Assets still asserted 41 claims across five patents when Amazon
`
`served its opening invalidity expert report on in August 2022. Although Amazon made further
`
`voluntary reductions of its invalidity grounds at that time,5 its expert still had to address more than
`
`175 claim limitations, accounting for the length of the report. VB Assets continued to assert the
`
`same claims through dispositive and Daubert motions (see D.I. 186 at 1 n.3), and again, it was
`
`Amazon who pressed VB Assets to narrow the case before the pretrial conference. (Ware Decl. Ex.
`
`5.) VB Assets dropped the ’536 patent and went to trial on just four claims (a mere 2% of those
`
`asserted originally), see D.I. 279, and in response Amazon reduced its 102/103 grounds to MIT
`
`Galaxy6 and United System + Partovi. Amazon pressed hard to narrow the case further and faster at
`
`
`4 For example, VB Assets dropped independent claim 25 of the ’681 patent but kept dependent
`claims 29, 33, 34, and 36 (which depend from claim 25), claim 30 (which depends from claim 29),
`and claim 31 (which depends from claim 30). (Id.) VB Assets dropped independent claim 44 of
`the ’176 patent but kept claims 46 and 45, which both depended from claim 44. (Id.) And it
`dropped independent claim 1 and dependent claim 31 (which depends from claim 1) of the ’703
`patent but kept claim 31 (which depends from claim 31). (Id.) Amazon was thus forced to reduce
`its asserted invalidity grounds while still addressing the limitations of the dropped claims.
`5 Five for the ’703 patent, four for the ’681 patent, and three for each of the ’176, ’536, and
`’097 patents. (Ware Decl. Ex. 6.)
`6 VB Assets’ complaint that the MIT Galaxy System consisted of several articles falls flat.
`(Op. Br. at 12, 15.) System prior art is commonly proved through a collection of references or
`
`{01972910;v1 }
`
`7
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 13 of 27 PageID #: 12610
`
`
`
`each stage. In no way does this rise to the level of egregious conduct necessary to enhance damages
`
`against the defendant. See Idenix, 271 F. Supp. 3d at 700; see also CloudofChange, LLC v. NCR
`
`Corp., No. 6:19-cv-513-ADA, 2021 WL 12093335, at *2 (W.D. Tex. Dec. 7, 2021) (“it is fairly
`
`common for parties to further narrow their presentations before a jury given the time constraints of
`
`a trial.”).
`
`Trial Theme. VB Assets also critiques the “two path” trial theme that Amazon presented.
`
`(Op. Br. at 6–9, 14.) Amazon discussed the parties’ separate paths—machine learning vs. rules—to
`
`explain why Amazon did not partner with VoiceBox and also the disconnect between the asserted
`
`claims and the accused Alexa functions. Mr. Thomas testified that “there are two ways of building
`
`these natural language understanding systems, one is to manually write the rules that help you parse
`
`and understand what the sentence mean, and the other is to leverage machine learning.” (Trial Tr.
`
`at 604:12–22; see also 128:6–24, 989:23–15.) Amazon knew it could not reach its intended scale
`
`using rules. (Id. at 605:9–607:1.) VoiceBox had a rules-based system when it met with Amazon in
`
`2011. (Id. at 608:18–22, 609:20–610:6, 612:5–16, 613:6–614:12.) It was “a hundred percent based
`
`on manual tuning these rules, there was no[] [] machine learning component,” and did not fit
`
`Amazon’s vision for Alexa. (Id. at 614:15–615:1.) The fact that Alexa has some portion of queries
`
`now addressed by rules doesn’t mean this testimony wasn’t 100% true.
`
`While VB Assets convinced the jury to disregard the distinction, nothing in the trial record
`
`suggests that Amazon’s defenses lacked merit. In fact, to overcome Amazon’s arguments about
`
`rule-based systems, VB Assets suggested to the jury that it had accused the rules-based functions in
`
`Alexa and that Amazon had simply concealed that fact to confuse them, when the opposite was true.
`
`
`devices. Here, Amazon described those in its expert reports, authenticated them, and listed them
`in its pretrial disclosures. (See D.I. 239 (Proposed Pretrial Order) Ex. 7 (Schedule D2) at DTX
`Nos. 246–249, 288–302, 305–308, 315–317, 361.)
`
`{01972910;v1 }
`
`8
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 14 of 27 PageID #: 12611
`
`
`
`Throughout the entire case, VB Assets accused the machine learning components of Amazon’s
`
`NLU, and not any rules-based modules. (See, e.g., Ware Decl. Ex. 7 ¶¶ 90 (“The domain models
`
`are machine-learned DNNs used to classify the user’s intent”), 160–63 (accusing trained Alexa NLU
`
`models for the long-term shared knowledge limitation of the ’681 patent), 172 (accusing “NLU
`
`machine-learning models” for the “identifying a context limitation of the ’681 patent).) But at trial,
`
`it sought to blur that fact. Closing remarks from VoiceBox’s attorney illustrate this:
`
`The fact that you heard at trial that Amazon was using rules, Amazon’s own technical
`document, this is DTX-0389, shows the NLU, this is from Amazon, this is an
`Amazon document, this is not something created by VoiceBox, [is] rules-based,
`everything here in blue is rules-based. The vast majority of Amazon’s NLU, the
`accused technology in this case, is rules-based. And they confirmed that they use
`rules and that these rules understand context and determine meaning. Now, let’s talk
`about the big brain that we were talking about. The big brain here is the statistical
`model. It’s the small pink portion right here. The big brain that we heard over and
`over about is only a small portion of the Amazon NLU.
`
`
`(Trial Tr. at 915:18–916:6 (emphasis added); DTX-0389.0021.) All of this was misdirection because
`
`VB Assets never accused anything rules-based in Alexa—it only accused what is in the “small pink
`
`portion” of the diagram.7
`
`
`7 VB Assets makes much of the fact that Kelly Vanee, an author of Amazon NLU documents,
`was not present at trial. (Op. Br. at 15.) But this ignores that VB Assets chose to play less than a
`
`{01972910;v1 }
`
`9
`
`

`

`Case 1:19-cv-01410-MN Document 315 Filed 01/10/24 Page 15 of 27 PageID #: 12612
`
`
`
`Section 101 defense. VB Assets similarly mischaracterizes the record concerning the
`
`ineligibility of the ’681 patent. (Op. Br. at 16.) The Court ruled in its motion to dismiss order that
`
`the ’681 patent claim presented was not directed to an abstract idea, thus satisfying Alice Step 1.
`
`(See D.I. 57; D.I. 280.) But it also ruled that this claim was not representative of the claims asserted
`
`at trial, requiring Amazon to maintain its section 101 defense as to other asserted claims including
`
`step 2. The parties attempted to simplify trial by stipulating that “they did not have distinct
`
`arguments for or against eligibility at Alice Step 1,” which would have allowed the Court to enter a
`
`judgment of eligibility as to asserted claim 13 of the ’681 patent while preserving the step 1 issue.
`
`(D.I. 280.) Amazon prepared its trial testimony based on this shared understanding, so as not to
`
`waste time and resources. The Court ultimately took a different view and rejected the parties’
`
`stipulation, as it was entitled to do. But the result was only that Dr. Johnson did not testify
`
`specifically to a conclusion on conventionality. The ineligibility of the ’681 patent remains a live
`
`issue as Amazon continues to pursue that defense based on the s