Case 1:14-cv-02396-PGG-MHD Document 176 Filed 10/01/19 Page 1 of 6
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`October 1, 2019
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`Filed Via ECF
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`Hon. Paul G. Gardephe
`United States District Court
`Southern District of New York
`40 Foley Square, Room 2204
`New York, New York 10007
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`12424
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`Wilshire Boulevard
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`12th Floor
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`Los Angeles
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`California
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`90025
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`Tel 310.826.7474
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`Fax 310.826.6991
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`Re: Network-1 Technologies, Inc. v. Google LLC, et al.,
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`Case Nos. 1:14-cv-2396-PGG & 1:14-cv-9558-PGG
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`www.raklaw.com
`Dear Judge Gardephe:
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`Pursuant to Local Civil Rule 37.2 and Paragraph 4(E) of the Court’s Individual Rules of Practice
`(Civil Cases), the parties respectfully submit the following joint letter concerning a dispute
`between the parties. The parties exchanged letters concerning the dispute and then met and
`conferred via a thirty minute teleconference on September 23, 2019. The attorneys involved were
`Amy Hayden and Jacob Buczko for Network-1 and Andrew Trask and Graham Safty for
`Defendants.
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`I.
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`Network-1’s Position: Google’s Second Supplemental Invalidity Contentions
`Should be Stricken Because Google Served Them Over Six Months Past the
`Court’s Deadline to Supplement.
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`Plaintiff Network-1 Technologies, Inc. (“Network-1”) moves to strike as untimely, pursuant to
`Paragraph 6 of the Scheduling Order and Fed. R. Civ. P. 16(b)(4) and 16(f)(1)(c), Defendants’
`(Google LLC and YouTube LLC, hereinafter “Google”) Second Supplemental Invalidity
`Contentions (served August 30, 2019). Ex. A. (hereinafter “Late Contentions”). The Late
`Contentions disclose, for the first time, Google’s invalidity theories concerning a purported prior
`art system identified as “Relatable FreeAmp audio identification system, including when used in
`conjunction with the MusicBrainz audio information database” (hereinafter “MusicBrainz”
`system). Ex. A at 1-2. Google also, on September 12, 2019, served three Notices of Depositions
`of persons purportedly having knowledge related to the system first disclosed in Google’s Second
`Supplemental Contentions. Exs. B-D (Breslin, Kaye and Ward Notices). Network-1 requests that
`the depositions be stayed pending the Court’s resolution of the motion to strike.
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`Google’s new contentions should be stricken because they were late and Google neither sought
`nor obtained leave to present untimely invalidity contentions. Google agreed, and the Court
`ordered, that “Defendants shall supplement any Invalidity Contentions … no later than March
`15, 2019.” (Doc. 137-1, ¶ 6)(emphasis added); Ex. E at 4:22-24. Google violated this order when
`it served its Late Contentions on August 30, 2019 - over six months past the deadline. Google
`failed to seek to alter the deadline or seek leave of Court to serve contentions after the deadline.
`Therefore, the Late Contentions should be stricken from the case. Fed. R. Civ. P. 16(b)(4) (“A
`schedule may be modified only for good cause and with the judge's consent”); Rule 16(f)(1)(c) (“a
`court may, upon motion or on its own, strike material “if a party or its attorney fails to obey a
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`Case 1:14-cv-02396-PGG-MHD Document 176 Filed 10/01/19 Page 2 of 6
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`Hon. Paul G. Gardephe
`October 1, 2019
`Page 2
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`scheduling or other pretrial order”); Roche Diagnostics GMBH v. Enzo Biochem., No. 04-cv-4046-
`RJS, Doc. 129, pp. 2-3 (S.D.N.Y. Nov. 11, 2013)([t]he Court will not permit Roche to posit new
`invalidity contentions after the [Court-ordered deadline for invalidity contentions]”)(Ex. F); Roche
`Diagnostics GMBH v. Enzo Biochem., No. 04-cv-4046-RJS, Doc. 238, pp. 3-6 (S.D.N.Y. Mar. 4,
`2015)(same)(Ex. G); Convolve, Inc. v. Compaq Comput. Corp., No. 00CIV.5141(GBD)(JCF),
`2006 WL 2527773, at *5 (S.D.N.Y. Aug. 31, 2006)(“By attempting to reserve the right to amend
`its invalidity contentions, Seagate also violated the Scheduling Order.”).
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`Google attempts to excuse its violation of the Scheduling Order by insisting that the Court’s March
`15, 2019 deadline to supplement was meaningless. Google cites Patent Local Rule 9, which states
`that “[t]he duty to supplement in Fed. R. Civ. P. 26(e) shall apply to the Infringement Contentions
`and the Invalidity Contentions” and argues this provision effectively moots the deadline ordered
`by the Court in Paragraph 6 of the Scheduling Order. Google’s position is that, because it did serve
`something by the March 15 deadline, it can freely supplement and add prior art references past the
`deadline under the guise of Rule 26(e)’s “duty to supplement.” Google’s position defies not only
`logic, but also the plain language of the Scheduling Order that makes clear “Defendants shall
`supplement any Invalidity Contentions … no later than March 15, 2019.” This case-specific
`order takes precedence over any reading - no matter how strained - of the general Patent Local
`Rule provision. See Patent Local Rule 1 (“The Court may modify the obligations or deadlines set
`forth in these Local Patent Rules…”). Even if Google’s argument has some merit (and it does not),
`the “duty to supplement” of Fed. R. Civ. P. 26(e) explicitly requires any such supplementation be
`“in a timely manner.” Google’s Late Contentions were not timely. They were served over six
`months after the deadline.
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`Google’s legally unsupported position would also impose unnecessary burdens. Network-1 and
`Google negotiated and agreed to the provisions of Scheduling Order, which set a hard deadline for
`Network-1 to amend its infringement contentions (January 31, 2019), and a hard deadline to follow
`for Google to amend its invalidity contentions (March 15, 2019). Doc. 137-1, ¶¶ 5, 6. This bilateral
`agreement bound both parties and was ordered by the Court. It is simply unfair to enforce the
`agreement against Network-1 but excuse Google’s noncompliance. See, e.g., Roche at pp. 2-3 (Ex.
`G)(“Now Roche seeks to supplement is invalidity contentions, but the same rule applies: The Court
`will not permit Roche to posit new invalidity contentions after the … deadline.”)
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`The parties agreed to hard deadlines to serve supplemental contentions with good reason. Courts
`in this District have recognized that “[e]arly contentions force parties to crystallize their theories
`early in the case, to identify the matters that need to be resolved, and to streamline discovery …”
`Roche (Ex. G) at 1. Here, Google’s Late Contentions entirely frustrate this purpose and disclose,
`for the first time in this case, a MusicBrainz system, which Google argued during the parties meet-
`and-confer was always publicly-available. Google has also been in communication directly with
`nonparty individuals regarding this system and seeks to introduce their testimony into the case at
`this latest of junctures. Google noticed three depositions to occur as early as October 8, 2019 and
`they are to take place in disparate locations - England, Spain, and Washington D.C. Exs. B-D. This
`global discovery of nonparty witnesses apparently cooperating with Google is rushed and
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`Case 1:14-cv-02396-PGG-MHD Document 176 Filed 10/01/19 Page 3 of 6
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`Hon. Paul G. Gardephe
`October 1, 2019
`Page 3
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`occurring at a time when Network-1’s counsel is taking and defending numerous other depositions
`in this case. Worse, given that document discovery closes on September 30, and all depositions
`must be conducted by November 1, Network-1 has no opportunity to identify, locate, and depose
`other individuals with knowledge of the MusicBrainz system that are not working with Google.
`Network-1 also has no opportunity to perform any follow-up discovery on the system, such as
`interrogatories, document requests, or requests for admissions. Google’s unjustified delay in
`disclosing this alleged prior art will directly prejudice Network-1.
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`Google fails to offer any explanation of why it failed to comply with the Court’s order and disclose
`the MusicBrainz system at the tail-end of discovery. Network-1 filed this case in April 2014. Over
`five years have passed during which Google had the opportunity to investigate its invalidity
`defenses. During the parties’ meet-and-confer, Google confirmed its position that the MusicBrainz
`system was always publicly-available, but refused to explain why it disclosed the system so late.
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`Google failed to move for leave to serve the Late Contentions, but even if it had, Google would be
`unable to demonstrate the requisite “good cause” needed to amend the case schedule. Google
`simply cannot meet its burden to demonstrate diligence. Holmes v. Grubman, 568 F.3d 329, 335
`(2d Cir. 2009)(“Whether good cause exists turns on the “diligence of the moving party.”). This is
`the end of the inquiry. Id. But worse, as explained above, Network-1 is greatly prejudiced by the
`Late Contentions because inter alia, it is unable to take its own discovery of the system.
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`The Court should strike Google’s Late Contentions. The Court should also, in the interim, stay
`Google’s three noticed depositions beginning October 8 because they solely concern Google’s
`Late Contentions. Should Google press ahead with the depositions in absence of a stay, and the
`Court does eventually strike Google’s Late Contentions, Network-1 should be awarded its fees
`and costs associated with the three depositions. See Local Civil Rule 30.1.
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`II.
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`Google’s Position: Google’s supplemental contentions are timely and appropriate
`under the Scheduling Order and this Court’s Local Patent Rules.
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`The Local Patent Rules expressly permit the timely supplementation of parties’ contentions during
`discovery. Local Patent Rules 6 and 7 provide for the service of “Infringement Contentions” and
`“Invalidity Contentions.” Local Patent Rule 9 establishes a “Duty to Supplement Contentions,”
`providing that “[t]he duty to supplement in Fed. R. Civ. P. 26(e) shall apply to the Infringement
`Contentions and the Invalidity Contentions required by Local Patent Rules 6 and 7.” Rule 26(e),
`in turn, states that a disclosing party “must supplement or correct its disclosure or response … in
`a timely manner if the party learns that in some material respect the disclosure or response is
`incomplete or incorrect.” The Local Patent Rules, therefore, contain a “duty to supplement”
`contentions as discovery progresses. See Local Patent Rule 9 (emphasis added); see also Fed. R.
`Civ. P. 26(e).
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`Consistent with the plain language of the Rules, multiple courts have expressly recognized a
`party’s duty to supplement its contentions. See, e.g., Intellectual Ventures II LLC v. JP Morgan
`Chase & Co., No. 13-cv-3777, 2015 WL 3855069, at *5 (S.D.N.Y. June 22, 2015) (quoting Local
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`Case 1:14-cv-02396-PGG-MHD Document 176 Filed 10/01/19 Page 4 of 6
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`Hon. Paul G. Gardephe
`October 1, 2019
`Page 4
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`Patent Rule 9 and explaining that “[t]he Local Rules contemplate that the infringement contentions
`will be supplemented as discovery progresses pursuant to Fed. R. Civ. P. 26(e)”); see also Simo
`Holdings Inc. v. Hong Kong uCloudlink Network Tech. Ltd., 354 F. Supp. 3d 508, 509-10
`(S.D.N.Y. 2019) (acknowledging the duty to timely supplement contentions under Local Patent
`Rules 7 and 9); PopSockets LLC v. Quest USA Corp., No. 17-cv-3653, 2018 WL 2744707, at *3
`(E.D.N.Y. June 7, 2018) (holding, under the same local patent rules as in this District, that a party
`could supplement its contentions after the date in the scheduling order under “Rule 9 of the Local
`Patent Rules”). Indeed, in Mediated Ambiance LLC v. TouchTunes Music Corp., No. 18-cv-
`02624-PGG-GWG (S.D.N.Y), despite the defendant serving supplemental contentions “[p]ursuant
`to Local Patent Rules 7 and 9” several months after the specified date, both sides expressly agreed
`that “the parties are in compliance with the local rules concerning infringement and invalidity
`contentions.” See id. (Doc. 31, at 1-2) (Ex. H); see also id. (Doc. 16, ¶ 5(e)) (Ex. I); (Doc. 29-1,
`at 1) (Ex. J). There is simply no support for Network-1’s position that the Local Patent Rules
`prohibit supplementation.
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`There can also be no doubt that the Local Patent Rules—which “apply to patent infringement,
`validity and unenforceability actions and proceedings” in this Court—apply to this case. See L.
`Patent R. 1. Indeed, the parties’ Scheduling Order states expressly that the parties shall serve
`contentions under “Local Patent Rule 6” and “Local Patent Rule 7.” See 14-cv-2396 (Doc. 137-
`1, ¶¶ 5, 6) (Ex. K). Earlier this year, Google supplemented its contentions under “Local Patent
`Rule 7,” see Ex. A at 1, and Network-1 submitted its contentions under “Local Patent Rules 6 and
`9,” see Ex. L at 1. Nothing in the Scheduling Order or procedural history of this case suggests that
`the Local Patent Rules, including Local Patent Rule 9, are inapplicable.
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`The parties’ Scheduling Order, moreover, reflects the duty to supplement contentions. On January
`2, 2019, as part of the agreement to lift the stay in this case, Network-1 dropped some asserted
`patent claims and added new ones. See 14-cv-2396 (Doc. 134, at 2-3). On account of changes in
`the asserted claims, the parties agreed to an early exchange of contentions on January 31 and March
`15. See Ex. K at ¶¶ 5, 6. The parties also agreed that fact discovery would remain ongoing for
`more than six months following the contentions exchange, see id. ¶¶ 7, 8(e), and Google made
`clear its intent to pursue third-party discovery into prior art and other invalidity defenses during
`this period, see Ex. D at 5:18 – 6:4. Given the prolonged discovery period after the contentions
`exchange, supplementation served a meaningful purpose.
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`timely. The
`Google’s supplemental contentions, moreover, were both modest and
`supplementation identified only a single additional piece of prior art—the FreeAmp/MusicBrainz
`system, a system that is remarkably similar to, and predates, Network-1’s asserted patent
`claims. In mid-to-late June 2019—i.e., three months after Google filed its first contentions under
`the current Scheduling Order—Google first became aware of this system as potential prior art. See
`Decl. of Sumeet P. Dang, Esq., ¶ 2 (Ex. M). Google undertook a diligent investigation, contacting
`relevant witnesses (some of whom reside in Europe) and seeking documentation regarding the
`system’s operation. Id. ¶¶ 2-3. By August 15, 2019, Google obtained source code sufficient to
`confirm, for the first time, how the system operated. Id. ¶ 4. Google promptly reviewed that code
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`Case 1:14-cv-02396-PGG-MHD Document 176 Filed 10/01/19 Page 5 of 6
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`Hon. Paul G. Gardephe
`October 1, 2019
`Page 5
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`and supplemented its contentions a mere two weeks later, on August 30. Id. ¶ 5; Ex. A. Several
`weeks remained in the fact-discovery period, which does not end until November 1, 2019. By any
`measure, Google’s supplemental contentions were timely.
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`Network-1’s arguments to the contrary have no merit. First, Network-1 argues that the Scheduling
`Order “set a hard deadline” for contentions. But nothing in the Scheduling Order overrides the
`Local Patent Rules’ duty to supplement. Second, Network-1 contends that “[i]t is simply unfair to
`enforce the [Scheduling Order] against Network-1 but excuse Google’s noncompliance.” But
`Google did comply with the Scheduling Order, serving contentions by March 15, see Ex. N, and
`then supplementing those contentions on August 30 with one additional, newly-uncovered system,
`see Ex. A at 2. There was no prejudice to Network-1, which received Google’s supplement with
`a month remaining for written fact discovery and two months for fact depositions. See Ex. K at ¶
`7; 14-cv-2396 (Doc. 175). Network-1 had ample opportunity to pursue whatever discovery it
`wished regarding this system. It also remained free throughout discovery to supplement its own
`contentions. Third, Network-1 urges this Court to apply a “good cause” standard that required
`Google to seek “leave of Court” before serving its supplement. But those standards find no support
`in the Local Patent Rules or the cases applying them. Nor is there any basis for Network’s
`invocation of Rule 16, which involves requests for modification of a court schedule.
`Supplementation of contentions under the Local Patent Rules is governed by Rule 26(e), not Rule
`16. See Local Patent Rule 9 (“The duty to supplement in Fed. R. Civ. P. 26(e) shall apply to the
`Infringement Contentions and the Invalidity Contentions required by Local Patent Rules 6 and 7.”
`(emphasis added)).
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`Network-1’s cited cases are also inapposite. Convolve involved application of “the Northern
`District of California Patent Local Rules,” see 2006 U.S. Dist. LEXIS 62606, at *3-4, which are
`inapplicable here, see Simo, 354 F. Supp. 3d at 510 (“decisions from other courts imposing a ‘good
`cause’ standard for supplementing invalidity contentions are inapposite.”). Roche is likewise off-
`point. Roche was precluded from amending its contentions only after Roche itself sought and
`obtained a court order prohibiting Enzo from supplementing its contentions after the date specified
`in the scheduling order. See Ex. F at 2-3, 5. Unlike in Roche, Google has never suggested that the
`Scheduling Order prohibits the supplementation of either party’s contentions, and Network-1 has
`remained free to supplement its contentions.
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`At bottom, Network-1’s attempt to strike Google’s supplemental contentions is a thinly-veiled
`effort to eliminate a prior-art system carrying serious invalidity consequences for Network-1’s
`asserted claims. With its threat to seek fees and costs, moreover, Network-1 seeks to stymie
`discovery that is wholly appropriate under the express provisions of the Local Patent Rules.
`Google respectfully submits that the Court should decline Network-1’s requests to strike Google’s
`supplemental invalidity contentions and stay the scheduled fact depositions.
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`Case 1:14-cv-02396-PGG-MHD Document 176 Filed 10/01/19 Page 6 of 6
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`Hon. Paul G. Gardephe
`October 1, 2019
`Page 6
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`Dated: October 1, 2019
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`Respectfully submitted,
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`RUSS, AUGUST & KABAT
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`WILLIAMS & CONNOLLY LLP
`
`BY: s/ Marc A. Fenster
`
`Marc A. Fenster (pro hac vice)
`Brian D. Ledahl (pro hac vice)
`Adam S. Hoffman (pro hac vice)
`Paul A. Kroeger (pro hac vice)
`Amy E. Hayden (pro hac vice)
`12424 Wilshire Blvd. 12th Floor
`Los Angeles, CA 90025
`Phone: (310) 826-7474
`Fax: (310) 826-6991
`mfenster@raklaw.com
`bledahl@raklaw.com
`ahoffman@raklaw.com
`pkroeger@raklaw.com
`ahayden@raklaw.com
`
`Charles R. Macedo
`AMSTER, ROTHSTEIN &
`EBENSTEIN LLP
`90 Park Avenue
`New York, NY 10016
`Phone: (212) 336-8074
`Fax: (212) 336-8001
`cmacedo@arelaw.com
`
`
`Attorneys for Network-1
`Technologies, Inc.
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`BY: s/ Samuel Bryant Davidoff
`
`Samuel Bryant Davidoff
`650 Fifth Avenue, Suite 1500
`New York, NY 10022
`212-688-9224
`sdavidoff@wc.com
`
`Kevin Hardy (pro hac vice)
`Andrew V. Trask
`Graham W. Safty (pro hac vice)
`Sumeet P. Dang (pro hac vice)
`725 Twelfth St., N.W.
`Washington, D.C. 20005
`Phone: (202) 434-5000
`Fax: (202) 434-5029
`khardy@wc.com
`atrask@wc.com
`gsafty@wc.com
`sdang@wc.com
`
`Attorneys for Google LLC and
`YouTube, LLC
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`
`
`