Case IPR2014-00746
`U.S. Patent No. 5,563,883
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`Filed: July 7, 2014
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________________
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`ARRIS GROUP, INC.
`Petitioner
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`v.
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`C-CATION TECHNOLOGIES, LLC
`Patent Owner
`____________________
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`CASE IPR2014-00746
`Patent 5,563,883
`____________________
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`PATENT OWNER’S MOTION FOR DISCOVERY FROM PETITIONER
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`U.S. Patent No. 5,563,883
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` Paper No. 10
`Filed: July 7, 2014
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`UNITED STATES PATENT AND TRADEMARK OFFICE
`____________________
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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________________
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`ARRIS GROUP, INC.
`Petitioner
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`v.
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`C-CATION TECHNOLOGIES, LLC
`Patent Owner
`____________________
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`CASE IPR2014-00746
`Patent 5,563,883
`____________________
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`PATENT OWNER’S MOTION FOR DISCOVERY FROM PETITIONER
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`Case IPR2014-00746
`U.S. Patent No. 5,563,883
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`TABLE OF CONTENTS
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` Paper No. 10
`Filed: July 7, 2014
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`I. PRECISE RELIEF REQUESTED ........................................................................... 1
`II. FACTUAL BACKGROUND .................................................................................. 1
`A. Petitioner Indemnified Comcast in an Infringement Lawsuit Relating to the ’883
`Patent Filed More than One Year Prior to Petitioner’s Request for Inter Partes
`Review ......................................................................................................................... 1
`B. Petitioner’s Ability to Control Litigation against Comcast .................................. 3
`III. REASONS FOR THE RELIEF REQUESTED ....................................................... 4
`A. The Requested Discovery is Based on More than a Possibility and Mere
`Allegation .................................................................................................................... 5
`B. The Requested Discovery Does Not Overlap with Petitioner’s Litigation
`Positions or their Underlying Basis ............................................................................. 6
`C. Patent Owner Has No Other Means of Obtaining the Requested Discovery ....... 7
`D. The Requested Discovery Includes Easily Understandable Instructions .............. 8
`E. The Requested Discovery Is Not Overly Burdensome ......................................... 8
`IV. CONCLUSION ........................................................................................................ 8
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`Case IPR2014-00746
`U.S. Patent No. 5,563,883
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`TABLE OF AUTHORITIES
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` Paper No. 10
`Filed: July 7, 2014
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`Atlanta Gas Light Co. v. Bennett Regulator Guards, Inc.,
`IPR 2013-00453, Paper 40 (PTAB Apr. 23, 2014) ............................................... 6, 8
`Garmin Int’l, Inc. v. Cuozzo Speed Techs. LLC,
`IPR2012-00001, Paper 26 (PTAB Mar. 5, 2013) .......................................... 5, 6, 7, 8
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`Statutes
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`35 U.S.C. § 315 ................................................................................................... 4, 6, 7, 8
`35 U.S.C. § 316 ............................................................................................................... 5
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`Other Authorities
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`77 FR 48,756 ................................................................................................................... 5
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`Regulations
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`37 C.F.R. § 42.51 (b)(2) ................................................................................................. 1
`37 C.F.R. § 42.52(a) ....................................................................................................... 1
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`Case IPR2014-00746
`U.S. Patent No. 5,563,883
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` Paper No. 10
`Filed: July 7, 2014
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`Exhibit List
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`Exhibit #
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`Exhibit Description
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`C-Cation Tech 2001 C-Cation Technologies, LLC’s Proposed Discovery Request
`to Arris Group, Inc.
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`C-Cation Tech 2002 Complaint, C-Cation Tech., LLC v. Comcast Corp., No
`2:11-cv-00030 (filed Jan. 21, 2011), D.I. 1.
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`C-Cation Tech 2003 First Amended Complaint, C-Cation Tech., LLC v. Comcast
`Corp., No 2:11-cv-00030 (filed Apr. 5, 2011), D.I. 45.
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`C-Cation Tech 2004 Unopposed Motion to Dismiss Defendant Comcast Corp.,
`C-Cation Tech., LLC v. Comcast Corp., No 2:11-cv-00030
`(filed Feb. 27, 2012), D.I. 120.
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`C-Cation Tech 2005 Stipulation of Dismissal, C-Cation Tech., LLC v. Comcast
`Corp., No 2:11-cv-00030 (filed Jan. 21, 2014), D.I. 387.
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`C-Cation Tech 2006 FORM 10-K for the fiscal year ended December 31, 2013
`of Arris Group, Inc.
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`C-Cation Tech 2007 Scheduling and Discovery Order, C-Cation Tech., LLC v.
`Comcast Corp., No 2:11-cv-00030 (filed Oct. 3, 2012), D.I.
`145.
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`C-Cation Tech 2008 Defendant Comcast Cable’s Supplemental Intial Disclosures
`Pursuant to Fed. R. Civ. P. 26(a)(1), C-Cation Tech., LLC v.
`Comcast Corp., No 2:11-cv-00030.
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`C-Cation Tech 2009 “Arris Acquires Motorola Home: Creates Premier Video
`Delivery and Broadband Technology Company” (April 17,
`2013), available at
`http://ir.arrisi.com/phoenix.zhtml?c=87823&p=irol-
`newsArticle&ID=1807670.
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`C-Cation Tech 2010 “Corporate Terms and Conditions of Sale,” March 2012,
`available as of July 7, 2014 at
`http://moto.arrisi.com/_docs/EULA_Warranty.pdf.
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`C-Cation Tech 2011 Transcript of June 26, 2014 Conference Call, IPR2014-00746.
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`Case IPR2014-00746
`U.S. Patent No. 5,563,883
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`I.
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`PRECISE RELIEF REQUESTED
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` Paper No. 10
`Filed: July 7, 2014
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`Patent Owner C-Cation Technologies, LLC (“Patent Owner”) requests that the
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`Board authorize certain targeted discovery from Petitioner Arris Group, Inc.
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`(“Petitioner”) contained in Exhibit 2001, which consists of a single document request.
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`See 37 C.F.R. §§ 42.51 (b)(2), 42.52(a). This motion is filed in accordance with the
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`Board’s July 2, 2014 Order. (Paper No. 9.)
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`II. FACTUAL BACKGROUND
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`A.
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`Petitioner Indemnified Comcast in an Infringement Lawsuit Relating
`to the ’883 Patent Filed More than One Year Prior to Petitioner’s
`Request for Inter Partes Review
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`On January 25, 2011, Patent Owner filed a complaint (Ex. 2002) for patent
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`infringement against Comcast Corporation and others in the United States District
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`Court for the Eastern District of Texas (the “First Texas Action”),1 alleging that each
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`1 The First Texas Action was assigned docket number 2:11-cv-00030. On April 5,
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`2011, Patent Owner filed a First Amended Complaint in this action adding Comcast
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`Cable Communications, LLC and Comcast of Houston, LLC as defendants. (Ex.
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`2003.) The Comcast entities are collectively referred to herein as “Comcast.”
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`Pursuant to a settlement agreement, Patent Owner and Comcast subsequently
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`stipulated to the dismissal of the First Texas Action. (Ex. 2004 and Ex. 2005.)
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`of the defendants’ cable systems infringed claims of U.S. Patent No. 5,563,883 (“the
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`’883 patent”). 2 The ’883 patent is the same patent that is the subject of Petitioner’s
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`instant petition for inter partes review filed in May 2014—filed more than three
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`years after the First Texas Action. (See Paper No. 1.)
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`In the First Texas Action, Patent Owner accused Comcast systems that include
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`Petitioner’s products, specifically cable modem termination systems (“CMTSs”) and
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`cable modems, of infringing the ’883 patent.
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`In financial disclosures filed by Petitioner with the Securities and Exchange
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`Commission (“SEC”), Petitioner admits that Comcast made indemnification claims
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`against Petitioner with respect to the First Texas Action. For example, Petitioner’s
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`2013 annual report, as filed with the SEC states:
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`C-Cation:
`The Company and Comcast reached a settlement related to
`Comcast’s litigation with C-Cation, whereby the Company
`agreed to pay Comcast to settle indemnification claims against
`the Company in the quarter ended December 31, 2013.
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`(Ex. 2006 at 125 (emphasis added).)
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`This public filing is consistent with Comcast’s disclosures in the First Texas
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`Patent Owner subsequently brought a second action, assigned docket number
`2
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`2:14-cv-00059, for infringement of the ’883 patent against Petitioner and others in the
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`same district (the “Second Texas Action”).
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`Action. In that action the Court required all parties to disclose:
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`any indemnity or insuring agreements under which any person or
`entity may be liable to satisfy part or all of a judgment entered in
`this action or to indemnify or reimburse for payments made to
`satisfy the judgment; . . . .
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`(Ex. 2007 at 5.) In response, Comcast stated the following:
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`Certain of Comcast Cable’s vendors including, but not limited to,
`Arris Group, Inc., Cisco Systems, Inc., and Motorola, Inc., may be
`liable to satisfy part or all of a judgment entered in this action or to
`indemnify or reimburse for payments made to satisfy the judgment.
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`(Ex. 2008 at 15.)3
`B.
`Petitioner’s Ability to Control Litigation against Comcast
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`Additional public information confirms the likelihood of the existence of an
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`indemnification agreement between Petitioner and Comcast that provided Petitioner
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`with at least the ability to exercise control over Comcast’s defense and settlement of
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`the First Texas Action (as far as it related to products supplied by Petitioner).
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`For example, Petitioner’s standard “Corporate Terms and Conditions of Sale”
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`which are publicly available on Petitioner’s website, include section 22 entitled
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`“PROPRIETARY RIGHTS INDEMNIFICATION.” (Ex. 2010 at 6.) According to
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`section 22, Petitioner will “indemnify, defend and hold Customer harmless” for
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`Petitioner, Arris Group, Inc., acquired Motorola Home, the manufacturer of
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`Motorola CMTSs and cable modems, on April 17, 2013. (Ex. 2009.)
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`allegations of patent infringement based on products Petitioner provided to Customer
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`under three conditions: “(i) Customer promptly notifies ARRIS of the Claim, (ii)
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`Customer gives ARRIS all applicable evidence . . . and (iii) Customer gives ARRIS
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`reasonable assistance in and sole control of the defense and all negotiations for its
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`settlement or compromise.” Id. (emphasis added).
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`III. REASONS FOR THE RELIEF REQUESTED
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`Patent Owner moves to take very specific discovery from Petitioner. The
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`discovery requested consists of a single request for production:
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`Agreement(s) between Arris and Comcast under which Comcast
`requested indemnification for the claims brought against Comcast in
`the Texas Litigation that reference (or are contingent on) Arris’s
`ability to control the litigation.
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`(Ex. 2001.) Patent Owner expects that the requested discovery will confirm that
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`Petitioner “exercised or could have exercised control over” the claims of infringement
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`of the ʼ883 patent against Comcast’s use of Petitioner’s products in the First Texas
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`Action, and, consequently, whether Petitioner’s petition for inter partes review is
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`time-barred under 35 U.S.C. § 315(b) as the First Texas Action was filed more than
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`three years before Petitioner filed the instant petition for inter partes review.4 Patent
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`The Trial Practice Guide specifies that in determining if a non-party may be
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`recognized as a privy, whether “the non-party exercised or could have exercised
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`control over a party’s participation in a proceeding” is a factor that should be
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`Owner’s discovery request is therefore “necessary in the interest of justice” (see 35
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`U.S.C. § 316 (a)(5)), and further, meets each of the factors set forth in Garmin Int’l,
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`Inc. v. Cuozzo Speed Techs. LLC, IPR2012-00001, Paper 26 (PTAB Mar. 5, 2013) as
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`explained below.
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`A.
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`The Requested Discovery is Based on More than a Possibility and
`Mere Allegation
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`Patent Owner’s single discovery request narrowly focuses on indemnification
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`agreements between Comcast and Petitioner under which Petitioner controlled or had
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`the ability to exercise control over the First Texas Action. As set forth above, this
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`discovery request is based on publicly available information already uncovered by
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`Patent Owner including:
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` Petitioner’s public SEC filings, which confirm that Comcast in fact
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`requested indemnification from Petitioner stemming from the complaint
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`served by Patent Owner on Comcast in the First Texas Action;
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` Comcast’s initial disclosures in the First Texas Action where Comcast stated
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`that Petitioner may be liable to indemnify Comcast; and
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` Petitioner’s standard Corporate Terms and Conditions of Sale, as posted on
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`Petitioner’s website, which indicate that Petitioner’s policy is to grant itself
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`the ability to have “sole control of the defense and all negotiations for its
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`considered. See 77 FR 48,756 (“Trial Practice Guide”) at 48,759.
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`settlement or compromise” as a condition for indemnification.
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`In short, Petitioner’s public SEC disclosures and Comcast’s disclosures in the
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`First Texas Action strongly support the existence of at least one indemnification
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`agreement between Petitioner and Comcast, and Petitioner’s publicly available terms
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`of sale show that it is highly likely Petitioner, by these agreements, controlled, or had
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`the ability to control, the defense and settlement of the First Texas Action concerning
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`claims of infringement of the ’883 patent through the use of Petitioner’s products.
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`Accordingly, as the requested discovery is limited to specific agreements, the
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`content of which is supported by evidence already in Patent Owner’s possession and
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`the existence of which is not disputed by Petitioner (Ex. 2011 at p. 16, ll. 2-3), it falls
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`within the bounds of permissible additional discovery. See Atlanta Gas Light Co. v.
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`Bennett Regulator Guards, Inc., IPR 2013-00453, Paper 40 at 5-6 (PTAB Apr. 23,
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`2014). Further, as the requested discovery only requests indemnification agreements
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`that reference or are contingent on Petitioner’s ability to control the litigation, the
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`single request for production is calculated to render useful information concerning
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`whether Petitioner’s petition in the instant proceeding should be time-barred under 35
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`U.S.C. § 315(b) because its privy was sued more than a year before Petitioner filed its
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`petition. Id. at Paper 40 at 7; Garmin, IPR2012-00001, Paper 26 at 7.
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`B.
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`The Requested Discovery Does Not Overlap with Petitioner’s
`Litigation Positions or their Underlying Basis
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`Patent Owner does not seek to prematurely learn the litigation positions or
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`strategies of Petitioner in the pending Second Texas Action. Proper identification of
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`privies is a threshold issue under 35 U.S.C. § 315 (b), so addressing this issue early is
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`warranted. To the best of Patent Owner’s knowledge, the requested discovery does
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`not relate to Petitioner’s litigation positions, and is therefore proper under Factor 2 of
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`Garmin. See Garmin, IPR2012-00001, Paper 26 at 13.
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`C.
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`Patent Owner Has No Other Means of Obtaining the Requested
`Discovery
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`Patent Owner’s proposed discovery request narrowly targets indemnification
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`agreements that relate to whether Petitioner had the ability to control Comcast’s
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`defense in the First Texas Action. While Petitioner concedes the existence of these
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`agreements (Ex. 2011 at p. 16, ll. 2-3), they are confidential and are not publicly
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`available.
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`In addition, the information sought is not available to Patent Owner in the
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`litigation between Patent Owner and Petitioner currently pending in the Eastern
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`District of Texas. In the Second Texas Action, the Court’s scheduling order required
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`all parties to produce all documents relevant to any claim or defense of any party in
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`the action by June 2, 2014. To the best of Patent Owner’s knowledge, Petitioner did
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`not produce any indemnification agreements between Petitioner and Comcast pursuant
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`to this scheduling order. As the Petitioner did not produce any indemnification
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`agreements between itself and Comcast, it appears that Petitioner asserts that such
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`agreements are not discoverable in the Second Texas Action.
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`D.
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`The Requested Discovery Includes Easily Understandable
`Instructions
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`C-Cation Tech’s instructions are easily understandable and are based on the
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`instructions already approved by the Board in Garmin. See Garmin, IPR2012-00001,
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`Paper No. 26 at 14.5
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`E.
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`The Requested Discovery Is Not Overly Burdensome
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`C-Cation Tech’s proposed discovery requests are narrowly tailored to the
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`privity issue and seek only indemnification agreements that, according to the Trial
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`Practice Guide, are relevant to the determination of whether Petitioner’s petition in the
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`instant proceeding is time barred under 35 U.S.C. § 315 (b). As the discovery request
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`seeks only indemnification agreements, any financial, human resource, or time burden
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`on Petitioner should be negligible. See Atlanta Gas Light, IPR2013-00453, Paper 40
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`at 7; Garmin, IPR2012-00001, Paper 26 at 14.
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`IV. CONCLUSION
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`Based on the above, Patent Owner respectfully requests that the Board allow
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`the proposed discovery contained in Exhibit 1.
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`Date: July 7, 2014
`KENYON & KENYON LLP
`One Broadway
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`New York, NY 10004-1007
`Tel.: (212) 425-7200
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`5 Patent Owner agreed to remove an instruction requiring a privilege log in order to
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`Respectfully submitted,
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`___/Lewis V. Popovski/______
`Lewis V. Popovski, Attorney for Patent Owner
`Registration No. 37,423
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`alleviate Petitioner’s sole stated objection to the instructions included in Exhibit 1.
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`Certificate of Service
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`The undersigned hereby certifies that the foregoing PATENT OWNER’S
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`MOTION FOR DISCOVERY FROM PETITIONER together with Exhibits 2001
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`to 2011 were served via e-mail on July 7, 2014, in their entirety on the following:
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`LEAD COUNSEL
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`Andrew R. Sommer
`asommer@winston.com
`WINSTON & STRAWN LLP
`1700 K Street NW
`Washington, D.C. 20006-3817
`T: (202) 282-5000; F: (202) 282-5100
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`BACKUP COUNSEL
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`
`Jonathan E. Retsky
`jretsky@winston.com
`WINSTON & STRAWN LLP
`35 West Wacker Drive
`Chicago, IL 60601
`T: (312) 558-3791; F: (312) 558-5700
`
`
`KENYON & KENYON LLP
`
` /David J. Cooperberg/
`David J. Cooperberg
`Registration No. 63,250
`Attorney for Patent Owner
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`Date: July 7, 2014
`One Broadway
`New York, NY 10004-1007
`Tel.: (212) 425-7200
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`
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`9
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