Case 2:22-md-03034-TGB ECF No. 217, PageID.12183 Filed 01/19/24 Page 1 of 11
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF MICHIGAN
`SOUTHERN DIVISION
`
`
`IN RE NEO WIRELESS, LLC
`PATENT LITIG.
`
`Case No. 2:22-md-03034-TGB
`HON. TERRENCE G. BERG
`JURY TRIAL DEMANDED
`
`
`PLAINTIFF NEO WIRELESS, LLC’S REPLY IN SUPPORT OF MOTION
`TO STRIKE DEFENDANTS’ UNTIMELY PRIOR ART ELECTIONS
`
`
`
`
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF MICHIGAN
`SOUTHERN DIVISION
`
`
`IN RE NEO WIRELESS, LLC
`PATENT LITIG.
`
`Case No. 2:22-md-03034-TGB
`HON. TERRENCE G. BERG
`JURY TRIAL DEMANDED
`
`
`PLAINTIFF NEO WIRELESS, LLC’S REPLY IN SUPPORT OF MOTION
`TO STRIKE DEFENDANTS’ UNTIMELY PRIOR ART ELECTIONS
`
`
`
`
`
`
`
`Case 2:22-md-03034-TGB ECF No. 217, PageID.12184 Filed 01/19/24 Page 2 of 11
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`TABLE OF CONTENTS
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`I. ARGUMENT IN REPLY ................................................................................... 1
`A. Prior to December 20, 2023, Defendants never disclosed an invalidity
`theory based on Project Angel, nor elected Project Angel as a prior art
`reference........................................................................................................... 1
`B. Defendants have not demonstrated the diligence required for establishing
`good cause to assert new invalidity theories and to rely on unelected
`prior art references. .......................................................................................... 3
`1. Defendants were not diligent in obtaining the discovery allegedly
`required to assert Project Angel as a prior art reference. ............................. 3
`2. Defendants were not diligent in amending their contentions and/or
`prior art elections once that discovery was obtained. .................................. 4
`C. Neo will be prejudiced by the last-minute inclusion of Project Angel in
`Defendants’ invalidity case. ............................................................................ 6
`II. CONCLUSION ................................................................................................... 7
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12185 Filed 01/19/24 Page 3 of 11
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`TABLE OF AUTHORITIES
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`
`Cases
`
`Finjan, Inc. v. Blue Coat Sys., Inc.
` No. 13-cv-03999, 2015 WL 3640694 (N.D. Cal. June 11, 2015) .......................... 2
`
`O2 Micro Intern. Ltd. v. Monolithic Power Systems, Inc.
` 467 F.3d 1355 (Fed. Cir. 2006) ..........................................................................5, 6
`
`Webasto Thermo & Comfort N. Am., Inc. v. BesTop, Inc.
` No. 16-cv-13456, 2019 WL 2171262 (E.D. Mich. May 20, 2019) ....................... 2
`
`
`
`
`ii
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12186 Filed 01/19/24 Page 4 of 11
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`I.
`
`ARGUMENT IN REPLY
`Prior to December 20, 2023, Defendants never disclosed an
`A.
`invalidity theory based on Project Angel, nor elected Project
`Angel as a prior art reference.
`Prior to Defendants’ Second Supplemental Invalidity and Unenforceability
`
`Contentions, served on December 20, 2023, Defendants never disclosed a theory of
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`invalidity based on Project Angel. In Response (ECF No. 215), Defendants focus
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`on disclosures made regarding Defendants’ unfounded unenforceability theories.
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`See ECF No. 215, PageID.11986–11988. Yet Defendants readily recognize that
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`this Motion is not aimed at Defendants’ unenforceability theories. Id.,
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`PageID.11989 n.2. Defendants’ discussion is irrelevant, merely distracting from
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`the reality that Defendants unequivocally did not disclose an invalidity theory
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`based on Project Angel in their initial contentions. Despite listing Project Angel as
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`one of hundreds of potential references, Defendants instead disclosed 63 invalidity
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`charts containing hundreds of invalidity combinations. Not a single one of them
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`referenced Project Angel. See ECF No. 209, PageID.11835–11836. In the
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`hundreds of pages disclosing Defendants’ alleged motivations to combine for their
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`obviousness invalidity theories, not a single combination included Project Angel.
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`Project Angel was simply not part of Defendants’ invalidity case.1
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`1 This is also true of Defendants’ First Supplemental invalidity contentions, served
`on May 1, 2023, despite Defendants’ claim that they “maintained their assertions
`1
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12187 Filed 01/19/24 Page 5 of 11
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`This fact was confirmed by Defendants’ prior art election, in which they
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`specifically did not elect to pursue an invalidity theory based on Project Angel. See
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`ECF No. 209-3. This election (as is done in other patent cases) was meant to focus
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`the discovery efforts related to Defendants’ invalidity case. See Webasto Thermo &
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`Comfort N. Am., Inc. v. BesTop, Inc., No. 16-cv-13456, 2019 WL 2171262, at *3
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`(E.D. Mich. May 20, 2019) (stating that contentions in patent cases “act as forms
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`of pleading that disclose the parties’ theories of their case and thereby shape
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`discovery and the issues to be determined at trial” (quoting Finjan, Inc. v. Blue
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`Coat Sys., Inc., No. 13-cv-03999, 2015 WL 3640694, at *2 (N.D. Cal. June 11,
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`2015)). If Defendants had intended to conduct further discovery on an invalidity
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`theory based on Project Angel, they could have elected to do so. But they did not.
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`Defendants’ decision to not elect Project Angel as one of their 48 references
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`communicated the opposite intention to Neo.
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`Therefore, notwithstanding the opening of Defendants’ Response,
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`Defendants’ invalidity theories including Project Angel are unequivocally new,
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`and Defendants must demonstrate good cause to rely on these newly disclosed
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`theories based on the unelected Project Angel reference. ECF No. 84,
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`PageID.2599–2600; ECF No. 102, PageID.8172; see also Webasto, 2019 WL
`
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`that Project Angel rendered the asserted patent claims invalid[.]” ECF No. 215,
`PageID.11990.
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`
`
`2
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`
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12188 Filed 01/19/24 Page 6 of 11
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`2171262, at *6 (“Critically, unless an amendment is designed to take account of
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`the district court’s claim construction, amendments are permitted only for good
`
`cause.” (internal quotation marks omitted)). As discussed below, Defendants’
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`Response does not demonstrate this requisite good cause.
`
`B. Defendants have not demonstrated the diligence required for
`establishing good cause to assert new invalidity theories and to
`rely on unelected prior art references.
`1. Defendants were not diligent in obtaining the discovery
`allegedly required to assert Project Angel as a prior art
`reference.
`As confirmed by Defendants’ response, Defendants have no explanation for
`
`their delay in both (1) seeking discovery on Project Angel and (2) supplementing
`
`their contentions upon receiving that discovery. See ECF No. 209, PageID.11839.
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`First, despite describing their discovery efforts, ECF No. 215, PageID.11990–
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`11992, Defendants do not explain why it took them seven months (from August
`
`2022 to March 2023) to begin conducting this discovery. Compare ECF No. 84,
`
`PageID.2599 (“The parties should conduct timely discovery so that these
`
`contentions can be updated as soon as possible.”). There has been no justifiable
`
`excuse for this delay. Defendants contend that, prior to March 2023, they were
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`“diligently collecting—and disclosing to Neo—publicly available information
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`about Project Angel[.]” ECF No. 215, PageID.11993. But Defendants’ only
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`disclosures were their initial invalidity contentions, which, as described above,
`
`
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`3
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`
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12189 Filed 01/19/24 Page 7 of 11
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`disclosed no invalidity theory with Project Angel. Defendants made no additional
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`invalidity disclosures after that. And even starting from their initial contentions
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`served on November 2022, Defendants still delayed four months in seeking any
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`discovery. Defendants were simply not diligent in collecting this supposedly
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`necessary discovery, foreclosing good cause needed to assert a new invalidity
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`theory based on that discovery.
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`Defendants bizarrely criticize Neo for not bringing this motion to strike prior
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`to now, or “when Defendants served supplemental invalidity contentions [in May
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`2023].” ECF No. 215, PageID.11993. But throughout this time, there was nothing
`
`to strike. Defendants had not disclosed an invalidity theory with Project Angel (nor
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`elected it as prior art) until December 2023, after which Neo promptly filed the
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`instant Motion. Moreover, Neo did object at the time to Defendants’ untimely
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`discovery efforts, ECF No. 209, PageID.11837, putting Defendants on notice that
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`Neo would move to strike if Defendants actually tried to belatedly add such an
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`invalidity theory. But these early warnings make it all the more improper that
`
`Defendants still waited until the last possible moment to supplement.
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`2. Defendants were not diligent in amending their contentions
`and/or prior art elections once that discovery was obtained.
`In addition, Defendants’ Response ignores that good cause requires
`
`diligence in amending contentions once new information is obtained (though they
`
`never dispute that diligence is indeed required). Rather, Defendants insinuate that
`
`
`
`4
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`
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12190 Filed 01/19/24 Page 8 of 11
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`“new information received in discovery” always presents good cause for
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`supplemental invalidity contentions, regardless of the diligence shown in obtaining
`
`the discovery. ECF No. 215, PageID.11994. But this argument has been squarely
`
`rejected. See O2 Micro Intern. Ltd. v. Monolithic Power Systems, Inc., 467 F.3d
`
`1355, 1366 (Fed. Cir. 2006) (“Thus, we reject O2 Micro’s apparent argument that
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`‘good cause’ must exist for amending its infringement contentions, without regard
`
`to its diligence in doing so, merely because new evidence was revealed during
`
`discovery.”). Obtaining new discovery alone is not enough—Defendants must have
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`acted diligently in supplementing their contentions to demonstrate good cause.
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`Here, even accepting Defendants’ contention that their discovery “concluded
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`in September 2023,”2 ECF No. 215, PageID.11992, Defendants waited three
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`months to provide any supplemental contentions based on this discovery.
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`Defendants have not presented (prior to or in their Response) any justification for
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`this delay or evidence of diligence during this time.3 Like the patentee in O2
`
`Micro, Defendants here have similarly “failed to establish that it required three
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`months” to “sufficiently develop” their new contentions in order to adequately
`
`
`2 The majority of Defendants’ new Project Angel invalidity disclosures rely on
`documents obtained in May 2023. See ECF No. 209, PageID.11840.
`3 At most, they repeatedly call the December 20, 2023 cutoff “the agreed deadline”
`for serving final contentions. But they have no basis for contending that this post-
`Markman, last possible “deadline” for contentions nullifies the clear requirement
`that contentions be amended “seasonably” and “as soon as possible.” ECF No. 84,
`PageID.2599.
`
`
`
`5
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`
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12191 Filed 01/19/24 Page 9 of 11
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`disclose them. See O2 Micro, 467 F.3d at 1367. The Federal Circuit there affirmed
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`a district court’s finding of “a lack of diligence and therefore a lack of ‘good
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`cause’” based on a three-month delay in supplementing contentions.4 See id. at
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`1367–68. The Court should similarly find Defendants’ unexcused three-month
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`delay as a failure to act diligently as required for a showing of good cause.
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`C. Neo will be prejudiced by the last-minute inclusion of Project Angel
`in Defendants’ invalidity case.
`Defendants’ discussion of Neo’s prejudice focuses on a lack of trial dates set
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`in this case, thereby concluding that “Neo has plenty of time” to adequately
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`respond to Defendants’ untimely contentions. See ECF No.215, PageID.11997. Yet
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`as of the filing of this Reply, fact discovery closes in less than two weeks. This
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`period of time is in stark contrast to Defendants’ implicit premise that they
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`allegedly needed over a year and a half to investigate and formulate their untimely
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`theories. And Defendants’ references to Neo’s knowledge of Defendants’ ongoing
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`third-party discovery is irrelevant. All throughout that time, Neo had no notice that
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`Defendants were pursuing an invalidity theory based on that discovery. In fact,
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`Defendants’ year-long awareness of Project Angel weighs against their good
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`cause, not in favor of it. The fact that Defendants knew of the reference from day 1
`
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`4 Tellingly, in characterizing “the weight of authorities” and attempting to thinly
`distinguish cases cited by Neo, see ECF No. 215, PageID.11995–11996, Defendants
`do not at all address the Federal Circuit’s opinion in O2 Micro, despite its citation in
`Neo’s Motion. See ECF No. 209, PageID.11842.
`6
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`
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12192 Filed 01/19/24 Page 10 of 11
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`and still waited until the last minute to produce contentions just accentuates their
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`lack of diligence all the more. Neo was entitled to rely on Defendants’ actual
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`contentions and claim elections in conducting discovery in this case. Now, Neo
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`would indeed be prejudiced by the need to conduct discovery or new analysis in
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`the final weeks of fact discovery in response to Defendants’ untimely contentions.
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`See ECF No. 209, PageID.11834–11835.
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`II. CONCLUSION
`For the foregoing reasons, Neo requests the Court grant its motion to strike
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`Defendants’ belated invalidity contentions for the Project Angel reference and
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`Defendants’ election of Project Angel as a prior art reference in this case.
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`7
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`Case 2:22-md-03034-TGB ECF No. 217, PageID.12193 Filed 01/19/24 Page 11 of 11
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`DATED: January 19, 2024
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`Respectfully submitted,
`
`
`
`/s/ Jason D. Cassady
`Jason D. Cassady
`Texas State Bar No. 24045625
`Email: jcassady@caldwellcc.com
`Christopher S. Stewart
`Texas State Bar No. 24079399
`Email: cstewart@caldwellcc.com
`CALDWELL CASSADY CURRY P.C.
`2121 N. Pearl St., Suite 1200
`Dallas, Texas 75201
`Telephone: (214) 888-4848
`Facsimile: (214) 888-4849
`
`Jaye Quadrozzi (P71646)
`Email: quadrozzi@youngpc.com
`YOUNG, GARCIA & QUADROZZI, PC
`2775 Stansbury Blvd., Suite 125
`Farmington Hills, Michigan 48334
`Telephone: (248) 353-8620
`
`ATTORNEYS FOR PLAINTIFF
`NEO WIRELESS LLC
`
`
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that on January 19, 2024, the foregoing document
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`was filed electronically with the Clerk of Court using the CM/ECF system, which
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`will send notification of such filing to all attorneys of record.
`
`/s/ Christopher S. Stewart
`Christopher S. Stewart
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