`
`DANIEL JOHNSON, JR. (SBN 57409)
`RITA E. TAUTKUS (SBN 162090)
`MORGAN, LEWIS & BOCKIUS LLP
`One Market, Spear Street Tower
`San Francisco, CA 94105
`Telephone: 415.442.1000
`Facsimile: 415.442.1001
`
`djj ohnson@morganlewis.co1n
`rtautkus@morganlewis.com
`
`NATHAN W. MCCUTCHEON (pro hac vice)
`MARK W. TAYLOR (pro hac vice)
`BRADFORD A. CANGRO (pro hac vice)
`JACOB A. SNODGRASS (pro hac vice)
`DAE GUNN JEI (pro hac vice)
`MORGAN, LEWIS & BOCKIUS LLP
`1111 Pennsylvania Avenue NW
`Washington, DC 20004
`Telephone: 202.739.3000
`Facsimile: 202.739.3001
`
`A. JAMES ISBESTER (SBN 129820)
`BENJAMIN KLEINMAN-GREEN (SBN 261846)
`KILPATRICK TOWNSEND & STOCKTON LLP
`Two Embarcadero Center, Eighth Floor
`San Francisco, CA 94111
`Telephone 415.576.0200
`Facsimile: 415.576.0300
`
`jisbester@kilpatricktownsend.com
`bkleinman-green@ki1patricktownsend.com
`
`JORDAN TRENT JONES (SBN 166600)
`KILPATRICK TOWNSEND & STOCKTON LLP
`1080 Marsh Road
`Menlo Park, CA 94025
`Telephone: 650.326.2400
`Facsimile: 650.326.2422
`jtjones@kilpatricktownsend.com
`
`Attorneys for Defendant
`MOTOROLA MOBILITY LLC
`
`nmccutcheon@morganlewis.com
`mark.tay1or@morganlewis.com
`bcangro@morganlewis.com
`jsnodgrass@morganlewis.com
`dj ei@morgan1ewis.com
`
`Attorneys for Plaintiff
`FUJIFILM CORPORATION
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`SAN FRANCISCO DIVISION
`
`FUJIFILM CORPORATION, a Japanese
`Corporation,
`
`Plaintiff,
`
`V.
`
`Case No. C 12-03587 WHO
`
`JOINT STATEMENT ON FUJIFILM
`
`CORPORATION’S REQUEST TO
`DESIGNATE REPLACEMENT EXPERT
`WITNESS
`
`MOTOROLA MOBILITY LLC, a
`Delaware Limited Liability Company,
`
`Defendant.
`
`
`DB“ 8‘”7““
`
`IPR2015—01093
`
`CFAD Exhibit 1088
`CFAD Exhibit 1088
`CFAD v. NPS
`CFAD V. NPS
`IPR2015-01093
`
`
`
`Case 3:12-cv-03587-WHO Document 145 Filed 11/18/14 Page 2 of 7
`
`November 18, 2014
`
`Hon. William H. Orrick
`United States District Court for the Northern District of California
`450 Golden Gate Avenue
`San Francisco, CA 94102
`
`Re:
`
`Fu;ifilm Corp. v. Motorola Mobility LLC, Case No. C 12-03587 WHO
`
`Your Honor:
`
`Plaintiff Fujifilm Corp. ("Fujifilm") and Defendant Motorola Mobility LLC ("Motorola") submit
`this Joint Statement pursuant to the Court's Standing Order. While submitted as a joint
`statement, each party's statement below is its own, and by signing this Statement, neither party
`intends to indicate its agreement with the other party's statement.
`
`The parties are unable to certify that they have met the meet-and-confer requirement pursuant to
`the Court's Standing Order; however, for the following reasons, the parties respectfully request
`that they be excused from this requirement in this instance. The issue presented herein
`crystallized only within the past week and counsel for both Fujifilm and Motorola are taking
`expert depositions this week. Counsel for Fujifilm first learned on the afternoon of November
`13, 2014, that its damages expert witness, Dr. Gordon Rausser, has had his credibility called into
`question in a separate lawsuit where Dr. Rausser serves as an expert witness. The details of that
`matter are discussed in the attached Law 360 article from Portfolio Media, Inc., entitled "Expert's
`Secret Links Scrutinized In Railroad Antitrust MDL."
`
`In light of this development, Fujifilm asked Motorola to either agree to not raise at trial the
`credibility issues discussed in the Law 360 article, or to permit Fujifilm to submit a new damages
`expert report from a different damages expert by December 5, 2014. Motorola declined both
`proposed solutions, rejecting them even if Fujifilm were to cover Motorola's costs to rebut the
`substitute report. As such, in order to prevent undue prejudice to its case, Fujifilm now seeks
`relief to submit a substitute expert report related to damages. The following summarizes each
`party's position regarding this dispute.
`
`FUJIFILM'S STATEMENT
`
`The parties exchanged Initial Expert Reports on October 3, 2014, and Rebuttal Expert Reports on
`October 31, 2014. The parties are currently conducting expert depositions. Expert discovery is
`currently set to close on November 25, 2014, and dispositive motions are due December 9, 2014.
`Dr. Rausser's deposition is scheduled for November 21, and Motorola's damages expert
`deposition is scheduled for November 25. Trial is scheduled for April 20, 2015. Fujifilm does
`not believe that the present request to substitute its damages expert will affect the dispositive
`motion or trial date.
`
`Fed. R. Civ. P. 16(b), provides that a scheduling order "may be modified only for good cause and
`with the judge's consent." Courts have held that Rule 16(b) governs a request to submit a
`replacernent expert report after the deadline for expert discovery has expired. See, e.g., Nat'!
`R.R. Passenger Corp. v. Expresstrak, LLC, 2006 WL 2711533, at *2 (D.D.C. Sept. 21, 2006)
`
`DBI/ 81327513.1
`
`1
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`Case 3:12-cv-03587-WHO Document 145 Filed 11/18/14 Page 3 of 7
`
`(applying Rule 16(b) in considering motion to substitute expert). The good cause standard
`requires the party seeking relief to show that the deadlines cannot "reasonably be met despite the
`diligence of the party seeking the extension." Nat'! R.R. Passenger, 2006 WL 2711533, at *2.
`In evaluating good cause, courts also consider "the potential prejudice faced by the movant" and
`the possible prejudice to the party opposing modification. Id. at *3-4 (permitting supplemental
`expert disclosures when it is discovered that an expert has provided inaccurate answers at a
`deposition, such that the expert's credibility is damaged); see also Vincent v. Omniflight
`Helicopters, 2009 WL 4262578, at *4 (E.D. Wis. Nov. 24, 2009) (permitting party to designate
`new expert after deadline, where expert's credibility was undermined at deposition by false
`statements set forth in his qualifications profile) ..
`
`In addition, Fed. R. Civ. P. 37(c)(i) contains an express provision under which a failure to timely
`disclose an expert may be excused where the failure was "substantially justified or harmless."
`Id.; see also Lanard Toys, Ltd. v. Novelty, Inc., 375 Fed. Appx. 705, 713 (9th Cir. 2010) (finding
`that district court was within its discretion to allow expert testimony where party failed to timely
`disclose its expert's report). "Among the factors that may properly guide a district court in
`determining whether a violation of a discovery deadline is justified or harmless are: (1) prejudice
`or surprise to the party against whom the evidence is offered; (2) the ability of that party to cure
`the prejudice; (3) the likelihood of disruption of the trial; and ( 4) bad faith or willfulness
`involved in not timely disclosing the evidence." Id. (citation omitted).
`
`The above factors justify substitution of Fujifilm's damages expert.
`
`First, Motorola will not be unduly prejudiced or surprised because Fujifilm has already retained
`a new damages expert who can provide a substitute expert report by December 5, 2014, allowing
`Motorola sufficient time to serve a rebuttal report on December 19, 2014. This proposed
`schedule would give Motorola ample time to depose Fujifilm's substitute damages expert.
`Neither party has deposed the current damages experts. In addition, the damages expert
`testimony in this case is not likely to be the subject of any dispositive motions.
`
`Second, Fujifilm will be significantly prejudiced if forced to proceed with Dr. Rausser as its
`damages expert witness. As shown by Motorola's refusal to agree to refrain from raising this
`issue at trial, the allegations in the Law 360 article call into question Dr. Rausser's credibility
`and pose a serious risk to Fujifilm's case. It would be extremely prejudicial to Fujifilm if it were
`forced to proceed with a damages expert embattled by allegations of untruthfulness that
`Motorola intends to exploit at trial when there is still ample opportunity to substitute experts.
`Moreover, if the court in the In re Rail Freight Fuel Surcharge Antitrust Litigation, No. 1 :07-mc
`00489 (D.C.) case were to conclude that Dr. Rausser's credibility has, in fact, been
`compromised, such an order may not come until closer to or on the eve of trial. At that point,
`Fujifilm will likely be unable to ameliorate the repercussions of any negative findings.
`
`Third, substituting the damages expert will not disrupt the trial in any way. The trial date is not
`scheduled until April 20, 2015. Fujifilm is prepared to serve a replacement damages expert
`report by December 5, 2014 and to make the new expert available for deposition after Motorola
`serves its rebuttal report. Thus, the substitution will not affect the trial date.
`
`Fourth, there was no bad faith or willfulness on the part of Fujifilm in failing to seek this
`substitution sooner. This issue only came to Fujifilm's attention a few days ago, on November
`13, 2014. Counsel for Fujifilm alerted counsel for Motorola to this issue the next day and asked
`
`DBI/ 81327513.1
`
`2
`
`
`
`Case 3:12-cv-03587-WHO Document 145 Filed 11/18/14 Page 4 of 7
`
`whether Motorola would agree to not raise this issue at trial. Motorola responded yesterday,
`November 17, indicating that it would not agree to refrain from bringing this issue to the jury's
`attention. As soon as this issue came to light, Fujifilm took immediate steps to confirm with a
`substitute damages expert that it is in a position to serve a new report by December 5. To
`address any potential concerns of unfair advantage, Fujifilm will agree to not share Motorola's
`current damages expert report with Fujifilm's substitute damages expert. It is due to these
`rapidly unfolding and recent events that Fujifilm now seeks to substitute its damages expert, and
`is in no way a reflection of any purported bad faith.
`
`For the foregoing reasons, Fujifilm respectfully requests that this Court permit Fujifilm to
`substitute its damages expert witness and to serve a new damages expert report on or before
`December 5, 2014.
`
`MOTOROLA'S STATEMENT
`
`Motorola opposes Fujifilm's request to substitute a new damages expert at this late stage in the
`case.
`
`Fujifilm seeks a remedy that is both drastic and premature. Foremost, Fujifilm's "solution"
`would severely prejudice Motorola by forcing Motorola to rebut new substantive expert opinions
`and needlessly incur increased litigation costs. Fujifilm acknowledges that Dr. Rausser remains
`available to serve as an expert witness in this case. Thus, Fujifilm's only articulated concern is
`the potential prejudice created by issues relating to Dr. Rausser's credibility. A pretrial motion
`in limine is the most effective and fair way for the Court to consider this issue. In that context,
`the Court may appropriately address Fujifilm's concerns of prejudice without unfairly
`prejudicing Motorola. A substitute or replacement expert is unfair, unnecessary and impractical
`at this stage of the case.
`
`Motorola Will be Prejudiced if Fujifilm is Permitted a New Expert
`
`Courts considering motions to substitute expert testimony have routinely denied them where the
`non-moving party would be significantly prejudiced by a delay in the proceedings. See, e.g.,
`Smith v. Reynolds Transport Co., No. 3: 1 lcv2728, 2012 U.S. Dist. LEXIS 147921, at *3 (D.S.C.
`Jan. 23, 2013) (denying motion to substitute because it would "entail significant prejudice both
`to Defendants and the administration of justice"); See, e.g., Lopez v. I-Flow, Inc., No. 08-1063,
`2011 U.S. Dist. LEXIS 155826, at *2 (D. Ariz. May 12, 2011) ("Courts regularly deny a request
`to late-disclose an expert witness where it would result in significant expense to the opposing
`side and delay proceedings.").
`
`Motorola will be severely prejudiced if Fujifilm is permitted a new expert. Motorola has already
`spent hundreds of thousands of dollars opposing Dr. Rausser's report. Motorola rebutted Dr.
`Rausser's opinions not only in Motorola damages expert Nisha Mody's report, but also in
`Richard Eichmann's report. Mr. Eichmann's deposition took place on Tuesday, November 18. If
`Fujifilm were permitted to replace its damages expert, Motorola would not be given the two(cid:173)
`week objection period to the expert required by the protective order, would have to re-draft two
`reports, Mr. Eichmann would need to be re-deposed, and deadlines for all summary judgment
`motions related to damages would need to be modified (extended). In order to modify these
`
`DBI/ 81327513.1
`
`3
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`
`Case 3:12-cv-03587-WHO Document 145 Filed 11/18/14 Page 5 of 7
`
`deadlines, Fujifilm must demonstrate "good cause," which requires the party seeking relief to
`show that the deadlines cannot "reasonably be met despite the diligence of the party seeking the
`extension." Nat'l R.R. Passenger Corp. v. Expresstrak, L.L.C., 2006 WL 2711533, at *2 (D.D.C.
`2006). If Dr. Rausser is not replaced, Fujifilm cannot demonstrate "good cause" to modify these
`deadlines because no deadlines will need to be modified. Because Fujifilm's concerns can be
`easily addressed with a motion in limine, no good cause exists.
`
`Further, Motorola has consulted its experts Dr. Mody and Mr. Eichmann and their schedules
`prohibit the proposal made by Fujifilm. Due to preexisting scheduling and work conflicts, Mr.
`Eichmann is unable to provide a rebuttal report within the time suggested by Fujifilm. Dr. Mody
`is scheduled to be in trial for 7 of the 14 days Fujifilm has suggested be allotted to the rebuttal,
`and has preexisting work deadlines that prevent her from being able to commit to providing a
`rebuttal report in this matter during the 7 days remaining. Thus, if Fujifilm were to have its way,
`Motorola would be forced to find two new experts, get them up to speed on the case, and submit
`new rebuttal reports in two weeks' time, on late notice and over a holiday. Motorola has timely
`met all of its obligations and should not be forced to find new, replacement experts under the
`circumstances. The prejudice to Motorola in this situation is simply too great.
`
`Fujifilm Should Not Be Permitted a Second "Bite at the Apple".
`
`Courts considering motions to substitute expert testimony have also routinely denied them where
`the moving party seeks to benefit from broader or different testimony than the original expert.
`Nelson v. Tennessee Gas Pipeline Co., 243 F.3d 244, 250 (61
`h Cir. 2001) ("fairness does not
`require that a plaintiff ... be afforded a second chance to marshal other expert opinions and shore
`up his case."); see, e.g., Crandall v. Hartford Cas. Ins. Co., No. 10-00127, 2012 U.S. Dist.
`LEXIS 173995, at *3 (D. Idaho Dec. 6, 2012) (if an expert "is unavailable to testify at trial
`because of death ... that is a legitimate and appropriate reason for allowing a new expert to be
`named," but holding that if a "party's relationship with an expert becomes difficult, and leads to
`some regret that someone else had not been hired instead, that is a problem of the party's own
`making, and not a proper basis to further delay the case").
`
`Fujifilm would like the Court, and Motorola, to believe that the prejudice it may suffer if the jury
`is told at trial about Dr. Rausser's potential credibility issue is so severe as to justify an entirely
`new expert, and an entirely new expert report. Now that all expert reports have been exchanged,
`and now that Fujifilm has had the ability to review Motorola's damages expert Dr. Mody's
`report, it is clear that Dr. Rausser's report has fatal errors. The fact that Fujifilm does not offer as
`a solution that the Court could merely exclude or limit the credibility issues discussed in the
`Law360 article suggests that Fujifilm would prefer a second "bite at the apple."
`
`It would be extraordinarily unfair to Motorola if now, after Fujifilm's counsel has viewed all of
`Dr. Mody's opinions, both her own regarding Fujifilm's damages and those rebutting Dr.
`Rausser's opinions, to allow Fujifilm a chance to write a new expert report, with new opinions, a
`new damages number, and relying on new evidence. Absent a scope of limitations, Fujifilm
`could solicit a new expert to offer more favorable opinions than Dr. Rausser. If the Court
`concludes it necessary to grant Fujifilm a substitution of its expert at this late stage, Fujifilm
`should be required to use an expert that will stand behind Dr. Rausser's current report and testify
`to the methodology, conclusions, and damages number put forth by Dr. Rausser. Cardiac
`
`DBI/ 81327513.1
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`4
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`
`Case 3:12-cv-03587-WHO Document 145 Filed 11/18/14 Page 6 of 7
`
`Science, Inc. v. Koninklijke Philips Elecs. N. V., No. 03-1064, 2006 U.S. Dist. LEXIS 93833, at
`*4 (D. Minn. Dec. 22, 2006) (new expert could not testify "in any manner that is contrary to or
`inconsistent with" first expert and could not "enlarge" opinions in any manner). This would at
`least help mitigate some of the severe prejudice to Motorola if Fujifilm were afforded a second
`"bite at the apple".
`
`Rather Than Allow Fujifilm an Entirely New Report and Expert, the Court Should Determine if
`the Credibility Concerns May be Raised to a Jury, at the Proper Time
`
`It is premature for Fujifilm to demand that Motorola agree not to raise any credibility issues
`relating to Dr. Rausser at trial. Under Federal Rule of Evidence 403, the Court can exclude
`evidence where the probative value of such evidence "is substantially outweighed by a danger of
`one or more of the following: unfair prejudice, confusing the issues, misleading the jury, undue
`delay, wasting time, or needlessly presenting cumulative evidence." See FRE 403 (emphasis
`added). Therefore, the Court can, in its discretion, prevent any undue prejudice to Fujifilm with
`an appropriate in limine order and/or jury instructions. However, it is premature to decide that
`now; the situation with Dr. Rausser's credibility in the antitrust case is just beginning to unfold,
`and the Court will have more information and be able to better determine the appropriate course
`of action in advance of the trial. Motorola wishes to reserve its right to impeach Dr. Rausser's
`credibility, subject to the Court's discretion under FRE 403.
`
`Motorola respectfully requests that the Court deny Fujifilm's request and simply resolve the in
`limine motion regarding evidence of Dr. Rausser's credibility at the appropriate time. If the
`Court is inclined to grant Fujifilm immediate relief, the most Fujifilm should receive is an
`assurance that the Court would address this in a motion in limine regarding the credibility
`information, should Motorola choose to seek to introduce it. At this stage of the case, it would
`unfair and unduly prejudicial to force Motorola to rebut a new damages analysis from a new
`expert.
`
`/s/ Daniel Johnson, Jr.
`Daniel Johnson, Jr.
`
`MORGAN, LEWIS & BOCKIUS LLP
`Attorneys for Plaintiff
`FUJIFILM CORPORATION
`
`/s/ Jordan Trent Jones
`Jordan Trent Jones
`
`KILPATRICK TOWNSEND &
`STOCKTON LLP
`Attorneys for Defendant
`MOTOROLA MOBILITY LLC
`
`DBI/ 81327513.l
`
`5
`
`
`
`Case 3:12-cv-03587-WHO Document 145 Filed 11/18/14 Page 7 of 7
`
`FILER'S ATTESTATION
`
`Pursuant to Civil L.R. 5-l(i)(3) regarding signatures, I, Daniel Johnson, Jr., attest that
`
`concurrence in the filing of the document has been obtained from the other signatory. I declare
`
`under penalty of perjury under the laws of the United States of America that the foregoing is true
`
`and correct. Executed this 18th day of November 2014, at San Francisco, California.
`
`/s/ Daniel Johnson, Jr.
`Daniel Johnson, Jr.
`
`DBI/ 81327513.1
`
`6