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`
`BRIGHT DATA, LTD.,
`Plaintiff,
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
` ( CAUSE NO. 2:19-CV-395-JRG
` )
` (
` )
` (
`vs.
` )
` ( NOVEMBER 1, 2021
`TESO, LT UAB, et al
` ) MARSHALL, TEXAS
` ( 9:00 A.M.
`Defendants,
`______________________________________________________________
`
`
`
`VOLUME 1
`
`______________________________________________________________
`TRIAL ON THE MERITS
`BEFORE THE HONORABLE RODNEY GILSTRAP
`UNITED STATES CHIEF DISTRICT JUDGE
`and a jury
`______________________________________________________________
`
`SHAWN M. McROBERTS, RMR, CRR
`100 E. HOUSTON STREET
`MARSHALL, TEXAS 75670
`(903) 237-7464
`shawn_mcroberts@txed.uscourts.gov
`
`Shawn M. McRoberts, RMR, CRR
`Federal Official Court Reporter
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`project?
`A.
`Yeah. Initially, I thought I can't -- you know, I can't
`do it again, it's too tough, and I sort of -- I was at my
`house, and -- and he started coming over, and we talked about
`the internet, which we both love, and how, you know -- it was
`his idea initially about how we -- the internet could be
`completely in a different way, way more efficient, way faster,
`way better, way cheaper, and what's called more elegant. A
`more elegant solution, any thing which is more elegant means
`it presents itself in different ways to be better.
`Q.
`Okay. So you decided to go into business, and what was
`that business? What did it end up being?
`A.
`That's the business that we are talking about today.
`Q.
`And the name of the company was -- is?
`A.
`Well, the name is Bright Data.
`Q.
`Okay.
`A.
`We all seem to have changed the name over time.
`Q.
`Okay. At that time, what was the name of the company?
`A.
`I think when we started, we were calling it the Zone
`Project. And then it changed to Hola, and at some point we
`had different products.
`Q.
`All right. So I want to talk to you about the company
`Hola.
`A.
`Q.
`
`Yes.
`Okay? About what time period are we in with Hola?
`
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`I should say that it's all the same company.
`A.
`Okay.
`Q.
`So, you know, we're talking about -- when we started this
`A.
`company, we are talking about 2008. Again, we are in my house
`and discussing this idea of how the internet could be better.
`And initially I was saying, no, you know, I'm not going to do
`it, but it was just too good. Like we can really change the
`way the internet works. And so I said, you know, let's do it.
`And that's when we founded the company, which is today Bright
`Data.
`Okay. So Hola, which is now Bright Data, started in
`Q.
`around 2008 with ideas from you and Mr. Shribman?
`A.
`That's correct.
`Q.
`All right. And what was the idea that relates to the
`patents that we're here on today? How does that relate at
`Hola and in that time period what we're here on today?
`A.
`Right. So there needs to be distinction, at least there
`is in my mind as an entrepreneur, between what your -- what
`your idea is and then how you sell the idea. And typically
`we're much less -- it sounds strange, but we are much less
`concerned about how to sell it because the real problem in
`business is how do you give value to people, selling it is
`basically getting the value -- some of the value back.
`And so what attracted me to the business was, here's a
`new way to build the internet and it's elegant so it presents
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`itself in many different ways. Okay? And so we were
`thinking, this is -- the technology we are going to develop,
`it will make things much better, but which are the things that
`we should sell first?
`Q.
`Okay.
`A.
`And so we thought that what would be most attractive to
`people first is internet acceleration.
`Q.
`Now you're talking about speed.
`A.
`We thought that people would like to install this
`technology because it would make their internet faster.
`Q.
`All right. And how did that turn out?
`A.
`Not so good.
`Q.
`All right.
`A.
`Well, technically good because it works, so we were very
`excited, and after four years of working on this, day and
`night, we launched the product. And, you know, we were
`expecting everyone to, like, be super excited about it, and
`people didn't like the product. I mean, it worked, but nobody
`cared about the speed. And so people weren't installing it.
`And so we had like, you know, I don't know 10, 20 installs a
`day and that's it.
`Q.
`Okay.
`A.
`People didn't care.
`Q.
`All right. So when you went back to Mr. Shribman to the
`drawing board, let's call it, what did you decide to do with
`
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`Federal Official Court Reporter
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`the technology that --
`A.
`Well, first of all, the feeling is -- is horrible because
`you spent, you know, your life or your -- four years of your
`life doing this, this is all we did day and night, weekend,
`and nobody cared.
`But because we were already more experienced, we had --
`we had come quickly to the conclusion that we failed in what
`we offered as the -- the benefit to the people, the speed.
`But we said, look, this technology does a lot of things.
`It's a more elegant internet. So what are the other things
`that we can offer to people? And we made a list of eight
`different things, if I remember correctly, that could be
`interesting to people to use our technology for, the same
`technology that we created.
`Q.
`All right. And you're talking about the technology
`created that was embodied in what are now the patents?
`A.
`Yes.
`Q.
`All right. And so you had that list of eight things
`after you had went back to the drawing board with the
`technology that's in the patents, and what did you come up
`with that became a success?
`A.
`Yeah. So we actually didn't go back to the drawing
`boards physically because the drawing boards are for the
`technology, it's the same technology. We just said, let's --
`let's offer this -- present this differently to people.
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`Let's say, you know, one of the things that this more
`elegant internet creates is that you lose your IP address,
`meaning not lose in a bad way but a good way. You send these
`-- what -- what looks in Mr. Harkins' presentation as letters
`that are sent on the internet, the return address is lost but
`then you get your letter back. Right? That's the anonymity
`that this network provides.
`And so we said that could be a great thing to offer to
`people is anonymity and that's -- within our company, we call
`that product the Hola VPN, and that's something that we
`introduced first.
`Q.
`All right. So what did Hola VPN do for the consumers,
`the businesses out here, that became something that was
`successful?
`A.
`Hola VPN lets you browse the web without concealing your
`identity, and that's in a nutshell. Now, we didn't invent
`that feature. Right? We invented the underlying technology.
`The VPNs existed for a while, but they were all based on these
`servers. Like in Mr. Harkin's presentation, it's is
`Cisco-type servers, infrastructure that's sitting around.
`Maybe there's like, I don't know, a hundred thousand of them,
`but they are costly and they are identifiable.
`And so if you want to lose your identity and you go
`through one of these proxy servers, I don't know if you've
`ever seen the website, but they say it looks like you are
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`coming from proxy, you can't use our website, because they
`want to know who you are. Right?
`And so they know you're coming from one of these
`business, you know, proxy networks. And our thing was it's
`this network of devices, like in Mr. Harkins' presentation,
`it's phones, even laptops, you know, whatever is the type of
`minicomputer, you can route through that if the owner is part
`of that network. And, in return, he gets the ability also to
`use that anonymity network.
`And so that way, we were able to provide a service which
`up to now costs about $10 a month and was only affordable by
`some, to a service which is free or almost free and affordable
`by all, and that's what I think led to the success of that
`product.
`Q.
`All right. And does -- and explain this to me in short,
`easy terms. Does the anonymity of hiding your -- your
`address, your computer address, help you with security or with
`getting good information?
`A.
`Yeah. So the short answer is yes. Longer -- bit longer
`answer is, yes, because the website doesn't know who you are,
`and so it doesn't discriminate on, for instance, the pricing
`that you get. Sometimes when they see where you're coming
`from, they say, oh, this guy can maybe afford more or should
`pay more. And so those kind of things are the benefit that
`you get.
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`Q.
`
`All right.
`MR. MANN: Mr. Wilson, could I have Exhibit PTX 526,
`please, sir?
`Q.
`(BY MR. MANN) This is the front page of Exhibit 526. Do
`you recognize that?
`A.
`Can you move --
`Q.
`Do you see it on your screen?
`A.
`I see it on my screen. Can you move one page forward?
`Yeah, yeah, yeah. This is a presentation I wrote
`around -- yeah, a few years ago to explain our business
`offering, I believe.
`Q.
`Okay. Now, I want to ask you, first of all, who you were
`presenting this to.
`A.
`This I wrote for a -- for conference of business people.
`Q.
`Okay. And what kind of business people? All types?
`Computer? Security? Who?
`A.
`Computer -- computer IT-related, yeah.
`Q.
`And when you say IT, you mean?
`A.
`I guess computer people.
`Q.
`All right. Now, this first page, what does this slide
`represent? What are you trying to say with this slide to the
`people that you're talking to that would be relevant to us
`today?
`A.
`Well, this is the first part that we just spoke about
`now, that when two different people look at a price of flight
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`ticket, they see different prices. And this is something that
`we wanted to avoid with our consumer product, as I discussed
`earlier.
`Q.
`Okay.
`MR. MANN: Mr. Wilson, if you don't mind, move to
`
`page 4.
`Q.
`(BY MR. MANN) Is this a continuation of the
`presentation?
`A.
`Yeah. So the same thing we provided to consumers, the
`ability to view the internet as, you know, in a -- in a
`transparent way, we now started to provide to businesses.
`So in this case, a retailer, let's say, you know, Walmart
`I think has a tag line of every day low prices. Right? What
`does that mean? It means that don't worry about sales, don't
`worry about -- you know, whenever you come into Walmart,
`you're going to get the best price. But how can they promise
`you that? So how do they know what their competitors are
`charging?
`So ten years ago what they would do is they would hire
`these people who would go into stores and write down all the
`price of everything, phone back to headquarters, and
`headquarters would decide what are the prices today so we can
`be every day low prices to you. Right?
`But then the internet changes that because the internet
`discriminates. So now Walmart goes through -- Walmart goes
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`directly to its competitors', you know, from a Walmart
`computer. You want to check the price of the competition,
`they know it's Walmart, so they may jack up the price. So
`Walmart jacks it up, and then they can't promise you every day
`low prices.
`So Walmart then uses proxies, you know, these big
`servers, right, that they go through. But then when they go
`through the big server, their competition says, wait a minute,
`this is not a consumer; this is a server. Right? I know,
`it's probably Walmart looking at me. So, again, they jack up
`the prices. So, again, they can't promise every day low
`prices.
`And so we came to these kinds of customers and said, wait
`a minute, we have invented this consumer residential proxy
`network a long time ago in 2009, and you can use that and
`nobody will know that it's Walmart.
`Q.
`Okay. So that helps the business person, but it helps
`the consumer, too?
`A.
`Eventually, because it allows the businesses to offer
`really the lowest prices.
`Q.
`Okay.
`MR. MANN: Let's go to slide PTX 0005.
`(BY MR. MANN) Now, in the continuation -- what is the
`Q.
`difference in this slide and the previous one where we were
`talking about retailers cannot price competitively and this
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`where you say advertisers cannot avoid malicious advertisers?
`A.
`Yeah. It's two different uses of the same product. So
`we talked about Walmart before. Now let's talk about a
`company like Facebook, for example. So when they show you
`advertisements, how does that work?
`Let's say a guy, a person, a company, wants to advertise
`these glasses. So they take a picture of the glasses, they
`provide the picture to Facebook, and they give them a link,
`saying, you know, somebody's interested in the glasses, they
`press the picture and they go to my website and then I sell
`them the glasses. Right?
`Facebook wants to make sure that this website is safe for
`us, for the consumers, to use. So what they do at Facebook,
`they -- they press the -- the picture, they press a link, it
`goes to the website, and they want to see if this person at
`that website is a good guy or a bad guy.
`Now if he's a bad guy and he sees that it's Facebook
`looking at him, what is he going to do? He's going to show
`you a picture of glasses and try to sell you glasses. But if
`he sees that it's one of us, you know, coming in from
`Marshall, Texas, or whatever, he's going to try to maybe do
`something fishy with us. Right? Like infect us with a virus
`or whatever. And so how can a company like Facebook really
`check and find the bad guys?
`So what we say to them, hey, you know, you can't use
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`proxies because the bad guys knows. Right? He knows it's a
`proxy. Use a residential proxy, which is basically devices
`from people's homes, and that will get you to see the real
`picture.
`Q.
`So when you're saying use residential proxies, you're
`talking about if I decided to be in your network, the bad guy
`thinks it's me or the bad guy thinks it's Facebook?
`A.
`Right. So we first need to define what is in your
`network or you being in our network. It's not like a phone
`network. It's basically you installing an application to
`agree that we can use your phone or actually not your phone
`but your IP for several minutes a day.
`Q.
`Okay.
`A.
`And so you agree to do that. You don't have to, but if
`you want to agree to do that, it's for a particular benefit
`that you will get. We'll talk about why people will want to
`join this network later. But, yes, if you opted in, you get
`the benefit, and also for a few minutes a day we will use your
`IP for the benefit that we discussed here.
`Q.
`All right.
`MR. MANN: Let's go to 526.9, please.
`(BY MR. MANN) Here you're telling the folks that you're
`Q.
`writing this for, we created a P2P network of 30 million --
`A.
`Million.
`Q.
`-- consumers ready to help. What's this slide
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`trying -- what you're trying to tell the folks that you're
`giving this to, what you do for them?
`A.
`Got it. Yeah. Think about -- think about our problem
`now. So we go to Walmart, and we say, you can find out the
`real price. If you go to Facebook and say you can find the
`real bad guys, what do we need now? We need this
`infrastructure. And we started with a reasonable-sized
`infrastructure, but we need to go -- infrastructure, I mean,
`phones like you showed. So we actually need people to agree
`to be part of our network.
`And so how do we do that? And what we decided to do was
`to package our technology in what we call SDK, which is a
`software developers kit, and come into developers of
`applications and say, you can put this in your application.
`Why would they do -- and then that person can opt into our
`network.
`Why would they want to put that into the application?
`You know how you play a game like Sudoku on your phone and
`between the games you have to watch a 30-second advertisement.
`Right? Between the games or Candy Crush or whatever. And so
`that's annoying and that -- people don't like that.
`And so what we say is put this SDK into your Sudoku, into
`your Candy Crush, whatever, and then people can say, I want to
`be part of Bright Data's network and not see -- in return, I
`want to not see these advertisements and we will pay that game
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`developer money for every one of the people that opts into our
`network.
`So it's a pretty clever plan where, you know, in return
`for using your phone when you don't need it, it's plugged into
`your electricity, you're sleeping, WiFi, we'll use the IP for
`a few minutes and you can play games or do whatever you want
`in the apps without seeing advertisements.
`Q.
`And I failed to ask you, what does SDK stand for?
`A.
`It's a software developers kit.
`Q.
`Okay.
`THE COURT: Mr. Mann, I'm going to interrupt for a
`
`minute.
`Ladies and gentlemen, it's been more than two hours since
`we came back from lunch. We're going to take a short recess.
`I understand that there is more examination of this
`witness, and then we'll have cross-examination. So he'll be
`on the witness stand for a while longer.
`During this recess, take an opportunity to get a drink of
`water, stretch your legs. This is one of those short periods
`of time where you can simply close and leave your notebooks in
`your chairs.
`Remember all my instructions, including not to discuss
`the case among yourselves, and we'll be back shortly to
`continue with the Plaintiff's direct examination of Mr.
`Vilenski.
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`So with that, the jury's excused for recess.
`(Whereupon, the jury left the courtroom.)
`THE COURT: Be seated, please.
`Ma'am, I'm looking at you in the gallery. You don't have
`a mask on. You're the only person in the gallery who doesn't
`have a mask on. You. You need to wear a mask at all times in
`the gallery. All right?
`Counsel, make sure your trial teams who are not inside
`the bar are masked at all times. All right? That's now your
`burden and not my burden.
`Mr. Vilenski, you are going to have to slow down. These
`are long, long narrative answers. Perhaps if we have more
`discrete questions, we'd have shorter answers. But when you
`give these long narrative answers with material that you have
`lived with and know like the back of your hand, and this jury
`has never heard before, you go very, very fast, and it does
`not do your side of the case or the Court any good for the
`jury not to be able to follow your testimony.
`So please speak slowly and more distinctly, and avoid
`long narrative answers if at all possible. Okay?
`THE WITNESS: Yes, Your Honor.
`THE COURT: All right. We'll take a short recess,
`and we'll return in approximately 10 or 12 minutes and
`continue.
`Court stands in recess.
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`(Brief recess.)
`THE COURT: Be seated, please.
`Are you prepared to continue with your direct examination
`of the witness, Mr. Mann?
`MR. MANN: I am, Your Honor.
`THE COURT: All right. Let's bring in the jury,
`
`please.
`
`(Whereupon, the jury entered the courtroom.)
`THE COURT: Welcome back, ladies and gentlemen.
`Please have a seat.
`And for those of you in the jury who are wearing coats, I
`want you to understand I have zero control over the
`temperature in this room. It's all controlled remotely from
`Tyler by another federal agency. So just don't blame me if it
`gets chilly.
`All right. Mr. Mann, let's continue with direct
`examination.
`MR. MANN: Thank you, Your Honor.
`If we could have 526.14.
`(BY MR. MANN) Okay. Mr. Vilenski, in summary, when
`Q.
`you're giving this presentation to the folks you were giving
`it to, your title here, "See the web from any perspective
`without getting blocked or misled," and what I want to know or
`have an answer to is why at the end you put residential IPs,
`mobile IPs, and DataCenter IPs. Just a short answer for that,
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`Shawn M. McRoberts, RMR, CRR
`Federal Official Court Reporter
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`197
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`if it can be done.
`A.
`Well, residential IPs is the product we sell. Instead of
`having the big routers, we have the mobile phones and home PCs
`as part of our network. So that is what we call residential
`and mobile IPs. And I guess your question is, why do we have
`DataCenter?
`Q.
`And why is DataCenter IPs there?
`A.
`DataCenter IPs are the old type of proxies, the big
`servers that are identifiable. So I guess the question is,
`why do we provide identifiable servers as part of our network.
`And the answer is that these are like the old technology,
`they're cheaper. But at some point some of our customers
`said, for my less important traffic, I want that.
`So we just said, let's have this and that.
`Okay. And at the time you are giving this presentation,
`Q.
`do you know of anybody else, were there any other companies
`that were doing residential IPs, mobile IPs, like you guys did
`with your patent?
`A.
`No, nobody did. That's why we chose to do that when we
`were looking for what to do with the technology that we
`invented in 2009.
`Q.
`All right. So I want to go quickly to Exhibit 2, please.
`Can you tell us what Exhibit 2 is?
`A.
`Yeah. This is a patent that -- that we're talking about
`today.
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`Federal Official Court Reporter
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`202
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`Who is Mr. Okmanas?
`Q.
`This is Mr. Okmanas. He's the founder of Tesonet.
`A.
`Okay. When did you first get in contact with Mr. Okmanas
`Q.
`about anything related to business or patents, approximately?
`A.
`So remember when we wanted to offer these proxy -- the
`DataCenter IPs, not the residential that we invented but the
`older version of what we existed and we needed to buy servers
`with IPs for that or rent servers and IPs, and someone from
`our company got in touch with Mr. Okmanas. I don't remember
`who. And we decided that we will buy these from his company.
`And around that time, that's when I met Mr. Okmanas.
`Q.
`Okay. Let me show you Plaintiff's Exhibit 298. Does
`Plaintiff's Exhibit 298 look familiar to you?
`A.
`Yes. It's an email from around 2016.
`Q.
`All right. Do you remember if this email was near in
`time to when you were talking to Mr. Okmanas about renting or
`licensing or using servers from their company?
`A.
`I think this was later.
`Q.
`Okay. So would it be fair to say --
`A.
`A little bit later.
`Q.
`So how much before this time, if this helps you, were you
`talking to Mr. Okmanas about business and --
`A.
`I don't recall.
`Q.
`All right. So this email is in September 2016, up at the
`top, on a Monday. What were you talking to Mr. Okmanas about?
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`Federal Official Court Reporter
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`Well, at this time our network is starting to grow, and
`A.
`we -- more customers like I mentioned before are starting to
`use our network and we need a bigger network.
`And Mr. Okmanas' company had a -- an application that had
`significant distribution, and we wanted -- I wanted to offer
`him to put our SDK for the Bright Data network inside of his
`product, and so we would pay them for the distribution.
`Q.
`Okay. And when you were checking them out at that time,
`did they have any patents?
`A.
`Not that I know of.
`Q.
`All right.
`MR. MANN: Let's go now to Plaintiff's Exhibit 221.
`(BY MR. MANN) Does this look familiar?
`Q.
`Yep. This is a coordination of a meeting between Mr.
`A.
`Okmanas and I.
`Q.
`And what was the meeting supposed to be for?
`A.
`This is, I believe, on the same subject.
`Q.
`Okay. And tell me, did you end up doing business with
`Mr. Okmanas back at this time after you and he had discussed
`it back and forth?
`A.
`Not on the SDK. We did do business on the -- on renting
`servers from him for our business.
`Q.
`Okay. And why not on the SDK? And remind us what SDK
`is.
`A.
`
`SDK is the software developers kit. It's the piece of
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`Federal Official Court Reporter
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`software that we give to application developers. They put it
`in their application, and we pay them for the distribution.
`Q.
`Okay. So why did you not do business with him on SDK at
`that time?
`A.
`I don't recall. I -- I assume that -- I actually don't
`recall.
`Q.
`Did they have SDK at that time?
`A.
`No, they did not.
`Q.
`All right. So did you -- let me ask again. Did you
`start business with him on the servers?
`A.
`Yes, we did. We rented servers from Mr. Okmanas'
`company.
`Q.
`And what was the name of the company?
`A.
`At the time their name before Oxylabs, their name was
`Shader. Shader.IO.
`Q.
`Okay. And so when you began business with Shader, was
`everything fine?
`A.
`Well, initially, we -- you know, we signed the agreement,
`we got the servers, but then our customers started having
`problem with those servers. And so it didn't go so well.
`Q.
`And what problems were they having with the servers?
`A.
`We were getting an indication that -- well, when we
`bought -- there's two types of servers that you can rent. You
`can rent servers which belong only to you, which are called
`dedicated, or you can rent servers that you share with a lot
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`Federal Official Court Reporter
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`

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