Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 1 of 21 PageID #: 8375
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
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`NO. 2:15-CV-01274-JRG-RSP
`(LEAD CASE)
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`BLITZSAFE TEXAS, LLC,
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`
`Plaintiff,
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`v.
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`HONDA MOTOR CO., LTD., ET AL.,
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`Defendants.
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`
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`DEFENDANTS’ MOTION TO STRIKE PORTIONS OF THE
`REBUTTAL EXPERT REPORT OF JOSEPH C. MCALEXANDER III
`REGARDING VALIDITY OF U.S. PATENT NUMBERS 7,489,786 AND 8,155,342
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`

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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 2 of 21 PageID #: 8376
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`TABLE OF CONTENTS
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`Page
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`I.
`II.
`III.
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`IV.
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`V.
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`Factual & Procedural Background ..................................................................................... 2
`Legal Standard ................................................................................................................... 5
`The Expert Opinions Based on Blitzsafe’s Untimely Claim of Priority and the
`Undisclosed Documents Should be Stricken ..................................................................... 6
`A.
`Blitzsafe’s Eleven-Month Delay is Unjustified ..................................................... 7
`B.
`The Potential Prejudice to Defendants Would be Severe ...................................... 9
`C.
`Balancing the Relevant Factors Favors Granting Defendants’ Motion to
`Strike .................................................................................................................... 11
`Granting Blitzsafe Leave to Amend its Infringement Contentions Would Also be
`Unfairly Prejudicial to Defendants and Jeopardize the trial date .................................... 12
`Conclusion ....................................................................................................................... 13
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`i
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 3 of 21 PageID #: 8377
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`TABLE OF AUTHORITIES
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`Page
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`
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`CASES
`
`Am. Video Graphics, L.P. v. Elec. Arts, Inc.,
`359 F. Supp. 2d 558 (E.D. Tex. 2005) .......................................................................................5
`
`Arbitron, Inc. v. Int’l Demographics, Inc.,
`No. 2:06-cv-434, 2009 U.S. Dist. LEXIS 3191 (E.D. Tex. Jan. 16, 2009) .............................13
`
`Comput. Acceleration Corp. v. Microsoft Corp.,
`503 F. Supp. 2d 819 (E.D. Tex. 2007) .......................................................................................5
`
`Dataquill Ltd. v. Huawei Techs. Co.,
`No. 2:13-cv-633, 2015 U.S. Dist. LEXIS 179476 (E.D. Tex. June 11, 2015) ........................10
`
`EMG Tech., LLC v. Chrysler Grp., LLC,
`No. 6:12-cv-259, 2013 U.S. Dist. LEXIS 189413 (E.D. Tex. July 3, 2013) ...........................13
`
`Fenner Invs., Ltd. v. Hewlett-Packard Co.,
`No. 6:08-cv-273, 2010 U.S. Dist. LEXIS 17536 (E.D. Tex. Feb. 26, 2010) .............................5
`
`IXYS Corp. v. Advanced Power Tech., Inc.,
`No. C 02-03942, 2004 U.S. Dist. LEXIS 10934 (N.D. Cal. June 16, 2004) .............................5
`
`LML Patent Corp. v. JPMorgan Chase & Co.,
`No. 2:08-cv-448, 2011 U.S. Dist. LEXIS 128724 (E.D. Tex. Aug. 11, 2011) ..........................6
`
`Realtime Data, LLC v. Packeter, Inc.,
`No. 6:08-cv-144, 2009 U.S. Dist. LEXIS 73217 (E.D. Tex. Aug. 18, 2009) ................8, 10, 11
`
`Roy-G-Biv Corp. v. ABB, Ltd.,
`63 F. Supp. 3d 690, 699 (E.D. Tex. 2014) .................................................................................6
`
`SoftVault Sys. v. Microsoft Corp.,
`No. 2:06-cv-16, 2007 U.S. Dist. LEXIS 33060 (E.D. Tex. May 4, 2007) ...................... passim
`
`Tyco Healthcare Grp. LP v. Applied Med. Res. Corp.,
`No. 9:06-cv-151, 2009 U.S. Dist. LEXIS 125379 (E.D. Tex. Mar. 30, 2009) ................ passim
`
`
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`
`ii
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 4 of 21 PageID #: 8378
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`For nearly eleven months, Defendants Honda, Hyundai, Kia, Nissan, Toyota, and
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`Volkswagen have reasonably relied on Blitzsafe’s P. R. 3-1 infringement-contention disclosures
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`and its P. R. 3-2 production in conducting discovery and formulating their defenses. And when
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`questions later arose as to whether Blitzsafe intended to change the claim of priority in its P. R.
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`3-1(e) disclosures, Defendants reasonably relied on Blitzsafe’s affirmative representation that it
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`did not intend to rely on an earlier claim of priority. But now—after the close of fact
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`discovery—Blitzsafe’s expert has taken positions inconsistent with Blitzsafe’s P. R. 3-1(e)
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`infringement-contention disclosures and its P. R. 3-2 production. Blitzsafe’s expert now asserts
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`that the asserted claims of U.S. Patent No. 8,155,342 are entitled to the filing date of a patent
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`application filed on December 11, 2002, instead of June 27, 2006, the date explicitly disclosed in
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`Blitzsafe’s P. R. 3-1(e) disclosures. Blitzsafe’s expert also relies on documents that were not
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`included in Blitzsafe’s P. R. 3-2 production, and were never produced during fact discovery, to
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`argue that the ’342 Patent was conceived of before Defendants’ primary prior art reference.
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`There is no justification for Blitzsafe changing this claim of priority and relying on undisclosed
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`documents at the last minute in a rebuttal expert report after assuring Defendants that it had no
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`intention of doing so. At this late stage in the case, Blitzsafe should be working with Defendants
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`to narrow the issues for trial. It should not be introducing into the case a new dispute regarding
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`the correct priority date for the ’342 Patent.
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`The potential prejudice to Defendants resulting from Blitzsafe’s gamesmanship is severe.
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`Accordingly, Defendants move to strike the portions of the Rebuttal Expert Report of Joseph C.
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`McAlexander III Regarding Validity of U.S. Patent Numbers 7,489,786 and 8,155,342 that rely
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`on this untimely claim of priority and these undisclosed documents. In light of the following
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`facts, these opinions should be stricken:
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`1
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 5 of 21 PageID #: 8379
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` Blitzsafe asserted in its infringement contentions that “[e]ach of the asserted claims of
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`the ’342 patent is entitled to the priority date of U.S. Patent Application No.
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`11/475/847 [sic], filed June 27, 2006, under P.R. 3-1(e).” Exh. 1, at 6;
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` Defendants prepared invalidity contentions, and Honda, Hyundai, Kia, Nissan, and
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`Toyota narrowed their list of prior art references and combinations, in reliance on
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`Blitzsafe’s P. R. 3-1 disclosures and P. R. 3-2 production;
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` Only after the Patent Trial and Appeal Board instituted inter partes review of the ’342
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`Patent did Blitzsafe attempt to claim that the ’342 Patent is entitled to an earlier
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`priority date;
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` After Defendants insisted that Blitzsafe must seek leave to amend its infringement
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`contentions to make such a claim, Blitzsafe dropped the issue and never moved for
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`leave to amend;
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` Later, while Defendants were drafting their expert reports on invalidity, Blitzsafe
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`affirmatively represented that it was not relying on a priority date earlier than that
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`claimed in its P. R. 3-1(e) disclosures;
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` After the close of fact discovery, however, Blitzsafe’s expert did claim that the ’342
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`Patent is entitled to a priority date earlier than what Blitzsafe claimed in its P. R. 3-
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`1(e) disclosures, and he also cited unproduced documents in support of an even
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`earlier date of conception.
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`I.
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`FACTUAL & PROCEDURAL BACKGROUND1
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`Blitzsafe filed these consolidated cases on July 16, 2015, asserting infringement of U.S.
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`Patent No. 7,489,786 (“’786 Patent”) and U.S. Patent No. 8,155,342 (“’342 Patent”). Doc. 1, at
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`1 The docket entries and exhibits from the Honda case cited herein and submitted with this motion are exemplary of
`pleadings and documents filed and served in the Hyundai, Kia, Nissan, Toyota, and Volkswagen cases.
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`2
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`4–8. Blitzsafe served its infringement contentions four months later, on November 24, 2015.
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`Exh. 1. In its infringement contentions, Blitzsafe identified the priority date to which it
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`contended each asserted claim is entitled, as required by P. R. 3-1(e). For the ’786 Patent,
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`Blitzsafe identified the December 11, 2002 filing date of the application for the ’786 Patent, U.S.
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`Patent Application No. 10/316,961 (“’961 Application”). Exh. 1, at 6. For the ’342 Patent,
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`Blitzsafe identified the June 27, 2006 filing date of the application for the ’342 Patent, U.S.
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`Patent Application No. 11/475,847 (“’847 Application”). Id. Blitzsafe did not contend that the
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`asserted claims of the ’342 Patent are entitled to the filing date of any earlier application. See id;
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`see also Doc. 1-2, at 2 (face of ’342 Patent identifying applications in the claimed priority chain).
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`On the same day it served its infringement contentions, Blitzsafe also produced a set of
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`documents pursuant to Local Patent Rule 3-2. See Exh. 2 (production letter).
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`Relying on Blitzsafe’s infringement-contention disclosures and its P. R. 3-2 production,
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`Defendants identified prior art to the patents-in-suit and further developed their noninfringement
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`and invalidity defenses. On January 19, 2016, Defendants served their invalidity contentions,
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`and on May 13, 2016, Honda, Hyundai, Kia, Nissan, and Toyota narrowed the list of prior art
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`references and combinations upon which they intended to rely with the service of their
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`Preliminary Election of Asserted Prior Art pursuant to Eastern District of Texas General Order
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`13-20. Then, upon the close of fact discovery on September 19, 2016, each defendant served its
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`respective opening expert reports on the invalidity of the ’786 Patent and the ’342 Patent. In
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`their expert reports on the invalidity of the ’342 Patent, Defendants identified U.S. Patent
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`Application Publication No. 2006/0181963 (“Clayton”) as a key prior art reference that
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`anticipates and renders obvious the asserted claims of the ’342 Patent. E.g., Exh. 3.
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`3
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 7 of 21 PageID #: 8381
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`On October 17, 2016, Blitzsafe served the Rebuttal Expert Report of Joseph
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`McAlexander III Regarding Validity of U.S. Patent Number 7,489,786 and 8,155,342 on the
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`respective defendants (“McAlexander Validity Reports”). Exh. 4. In each rebuttal report,
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`McAlexander asserted that the ’342 Patent is entitled to the filing date of the earliest parent
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`application listed on its face, the ’961 Application, which was filed on December 11, 2002. Id. at
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`5, 49–50. McAlexander also cited several exhibits from an inter partes review proceeding
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`involving Blitzsafe and Toyota to support his assertion that the subject matter of the ’342 Patent
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`was conceived of prior to the Clayton reference. Id. at 106 & n.120.
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`Since serving its infringement contentions and P. R. 3-2 production eleven months ago,
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`Blitzsafe never moved for leave to amend pursuant to P. R. 3-6(b) to assert this new claim of
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`priority, and Blitzsafe never produced in this case any of the documents its expert now relies
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`upon to argue for an earlier conception date.2 On July 25, 2016—eight months after it served its
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`infringement contentions, and after the Patent Trial and Appeal Board instituted an inter partes
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`review proceeding—Blitzsafe expressed an intention to amend its infringement contentions in
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`order to identify a new priority date for the ’342 Patent. See Exh. 6. Blitzsafe raised the issue in
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`an email to which it attached an amended response to an interrogatory concerning the conception
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`and actual reduction to practice of the asserted claims. See Exh. 6 and Exh. 7. Defendants
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`promptly responded, indicating that they would oppose Blitzsafe’s motion for leave to amend its
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`infringement contentions. Exh. 6. After Defendants indicated their opposition, Blitzsafe never
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`filed the motion.
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`In mid-August, during a meet-and-confer with defense counsel, counsel for Blitzsafe
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`affirmatively represented that (a) it did not intend to move to amend its infringement contentions
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`2 In fact, it appears that Blitzsafe withheld some of these documents as privileged in this litigation. See Exh. 5 (item
`numbers 55, 77, 110, 137, 165, 167, 186, 188, 189, 3037-3041 on Blitzsafe’s privilege log).
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`4
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`to revise its P. R. 3-1(e) disclosures and (b) it had not relied on any priority dates different than
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`those disclosed in its infringement contentions. See Exh. 8. In reliance on these representations,
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`Defendants continued to prepare their expert invalidity reports based on the priority dates
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`claimed in Blitzsafe’s infringement contentions. See id.
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`After all of these communications, and knowing that Defendants were relying on the
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`priority dates claimed in Blitzsafe’s infringement contentions, Blitzsafe never sought leave to
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`amend its infringement contentions. Instead, Blitzsafe simply waited until serving its rebuttal
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`expert report to assert that the ’342 Patent is entitled to an earlier priority date than it had claimed
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`all along in its infringement contentions and to indicate that its expert would rely on conception
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`documents that it did not include in its P. R. 3-2 production or produce during fact discovery.
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`See Exh. 4, at 5, 49–50, 95–107, 106 n.120, 113.
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`II.
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`LEGAL STANDARD
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`The Local Patent Rules “exist to further the goal of full, timely discovery and provide all
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`parties with adequate notice and information with which to litigate their cases . . . .” Comput.
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`Acceleration Corp. v. Microsoft Corp., 503 F. Supp. 2d 819, 822 (E.D. Tex. 2007) (internal
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`quotation marks omitted) (quoting IXYS Corp. v. Advanced Power Tech., Inc., No. C 02-03942,
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`2004 U.S. Dist. LEXIS 10934, at *8 (N.D. Cal. June 16, 2004)). “The Patent Rules demonstrate
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`high expectations as to plaintiffs’ preparedness before bringing suit, requiring plaintiffs to
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`disclose their preliminary infringement contentions before discovery has even begun.” Am.
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`Video Graphics, L.P. v. Elec. Arts, Inc., 359 F. Supp. 2d 558, 560 (E.D. Tex. 2005). “Proper
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`infringement contentions provide a defendant with notice of a plaintiff’s infringement theories.”
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`Fenner Invs., Ltd. v. Hewlett-Packard Co., No. 6:08-cv-273, 2010 U.S. Dist. LEXIS 17536, at *6
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`(E.D. Tex. Feb. 26, 2010). “This notice focuses discovery and narrows issues for claim
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`construction, summary judgment, and trial.” Id. A plaintiff’s expert reports “may not introduce
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`theories not previously set forth in infringement contentions.” See, e.g., Roy-G-Biv Corp. v.
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`ABB, Ltd., 63 F. Supp. 3d 690, 699 (E.D. Tex. 2014).
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`“A court has the inherent power to enforce its scheduling orders and to impose
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`sanctions.” Tyco Healthcare Grp. LP v. Applied Med. Res. Corp., No. 9:06-cv-151, 2009 U.S.
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`Dist. LEXIS 125379, at *4 (E.D. Tex. Mar. 30, 2009) (citing Fed. R. Civ. P. 16(f)). “However,
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`interpretation and enforcement of discovery provisions of the Local Patent Rules should not
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`conflict with, and should harmonize with, the discovery provisions of the Federal Rules of Civil
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`Procedure.” Id.
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`When determining whether to exclude evidence based on a party’s failure to
`comply with the Patent Rules, a non-exclusive list of factors considered by courts
`includes:
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`1. The danger of unfair prejudice to the non-movant;
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`2. The length of the delay and its potential impact on judicial proceedings;
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`3. The reason for the delay, including whether it was within the reasonable
`control of the movant;
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`4. The importance of the particular matter, and if vital to the case, whether a
`lesser sanction would adequately address the other factors to be considered
`and also deter future violations of the court’s Scheduling Orders, Local
`Rules, and the Federal Rules of Civil Procedure; and
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`5. Whether the offending party was diligent in seeking an extension of time,
`or in supplementing discovery after an alleged need to disclose the new
`matter became apparent.
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`Id. at *5; see also LML Patent Corp. v. JPMorgan Chase & Co., No. 2:08-cv-448, 2011 U.S.
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`Dist. LEXIS 128724, at *13–14 (E.D. Tex. Aug. 11, 2011).
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`III. THE EXPERT OPINIONS BASED ON BLITZSAFE’S UNTIMELY CLAIM OF
`PRIORITY AND THE UNDISCLOSED DOCUMENTS SHOULD BE STRICKEN
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`Each of the factors considered when deciding whether to exclude evidence based on a
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`party’s failure to comply with the Local Patent Rules weighs heavily in favor striking (a) the
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`6
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`portions of the McAlexander Invalidity Reports that are based on a priority date earlier than the
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`June 27, 2006 priority date asserted in Blitzsafe’s infringement contentions and (b) documents
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`Blitzsafe did not produce pursuant to P. R. 3-2(b).
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`A.
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`Blitzsafe’s Eleven-Month Delay is Unjustified
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`Blitzsafe’s failure to produce all documents that purportedly evidence the conception of
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`the asserted claims and to amend its infringement contentions, and its decision to instead assert
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`an earlier claim of priority in its rebuttal expert report, are both unreasonable and inexplicable.
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`This Court has repeatedly refused to condone unjustified delay of this sort, and it should do the
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`same in this case.
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`In denying a plaintiff’s motion for leave to amend its infringement contentions, this Court
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`has held that a plaintiff “fail[ed] to establish any diligence whatsoever” when it waited six
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`months after serving its infringement contentions to seek leave to amend those contentions to
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`assert an earlier priority date for the asserted claims. SoftVault Sys. v. Microsoft Corp., No. 2:06-
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`cv-16, 2007 U.S. Dist. LEXIS 33060, at *2, 4 (E.D. Tex. May 4, 2007). The plaintiff in
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`SoftVault argued that it determined that it could claim an earlier priority date after investigation
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`in discovery, but the Court rejected this purported justification for the plaintiff’s delay. See id. at
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`*4. All of the relevant information was available to the plaintiff before it filed suit, and the Court
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`held that the plaintiff “cannot establish diligence in light of its failure to fully analyze this
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`information.” Id. The plaintiff’s explanation for its delay, therefore, “weigh[ed] heavily against
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`granting the motion” for leave to amend.
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`Here, nothing prevented Blitzsafe from asserting that the ’342 Patent is entitled to the
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`December 11, 2002 filing date of the ’961 Application when it served its infringement
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`contentions over eleven months ago. Blitzsafe should have analyzed and produced all
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`documents in its possession that purportedly evidence the conception of the claimed inventions
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`7
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`at this time as well. The ’342 Patent, its parent applications, and the purported conception
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`documents were in Blitzsafe’s possession at that time, and as the plaintiff, Blitzsafe could have
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`taken more time, if necessary, to review those documents before filing suit. Blitzsafe’s lack of
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`diligence and unexplained delay weighs heavily in favor of granting the present motion.
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`Further weighing in favor of granting the present motion is the fact that Blitzsafe waited
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`nearly eleven months to assert its new claim of priority and identify the unproduced conception
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`documents. This Court has previously found that “[w]aiting nine months after serving the
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`Original Infringement Contentions to seek leave to amend is not a reasonable period of time,
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`especially taking into account that [the] case [was] set for trial less than two years after filing.”
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`Realtime Data, LLC v. Packeter, Inc., No. 6:08-cv-144, 2009 U.S. Dist. LEXIS 73217, at *25, 32
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`(E.D. Tex. Aug. 18, 2009). Blitzsafe waited two months longer, never sought leave to amend its
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`infringement contentions, and never produced the purported conception documents. As in
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`SoftVault, in Realtime Data, the Court held that the plaintiff “failed to show either diligence or a
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`reasonable explanation for the delay” in seeking to amend its infringement contentions, again
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`emphasizing that the plaintiff “fail[ed] to point to a single piece of documentary evidence that
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`was disclosed late and is pertinent to the amendments.” Id. at *26, 32, 41. Blitzsafe has also
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`failed to show diligence or a reasonable explanation for its excessive delay, as it had all of the
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`information needed to make its now untimely claim of priority and the purported conception
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`documents at the outset of this case.
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`This Court’s decision in Tyco Healthcare also demonstrates why the Court should grant
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`this motion to strike. In Tyco Healthcare, the Court granted the plaintiff’s motion to exclude
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`expert testimony based on prior art combinations and motivations to combine that were disclosed
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`8
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`for the first time in the defendant’s expert report. Tyco Healthcare, 2009 U.S. Dist. LEXIS
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`125379, at *14. The Court found “no reason for the delay”:
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`There is no suggestion that the delay was somehow outside of Applied’s control.
`Applied had plenty of time to comply with the disclosure requirements of P.R. 3-
`3(b). There is no evidence before the court that Applied did not have sufficient
`information to provide the appropriate disclosures in a timely manner.
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` Id. at *12. Also, the Court relied on the fact that the defendant disclosed the new contentions for
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`the first time in its expert report without ever moving to amend its contentions (which were
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`served eleven months earlier), leaving the plaintiff little time to analyze the new allegations. See
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`id. at *11. Here, Blitzsafe also waited eleven months and failed to move to amend its
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`contentions. And as in Tyco Healthcare, there is no evidence that Blitzsafe did not have
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`sufficient information to provide appropriate disclosures in a timely manner.
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`B.
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`The Potential Prejudice to Defendants Would be Severe
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`Defendants’ ability to prepare their invalidity defenses will be severely prejudiced if
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`Blitzsafe is allowed to rely on a priority date inconsistent with its P. R. 3-1(e) disclosures or on
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`conception documents that it did not include in its P. R. 3-2(b) production. Defendants’
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`invalidity defenses for the ’342 Patent rely on Clayton as a primary prior art reference. E.g.,
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`Exh. 3. Defendants selected Clayton based on the priority date claimed in Blitzsafe’s P. R. 3-
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`1(e) disclosures and Blitzsafe’s P. R. 3-2(b) production because Clayton directly reads on the
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`asserted claims of the ’342 Patent and predates the earliest priority date to which Blitzsafe
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`claimed the ’342 Patent is entitled. But now, well past the deadline for Defendants to identify
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`new or different prior art, Blitzsafe has changed its position in the McAlexander Validity Reports
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`and asserts that the date of invention of the asserted claims of the ’342 Patent predates Clayton.
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`Fact discovery had closed by the time Blitzsafe served the McAlexander Validity Reports on
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`each respective defendant, leaving Defendants with no opportunity to conduct discovery related
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`9
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`to these new assertions or time to identify new or different prior art references with earlier
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`priority dates. Moreover, Defendants tailored their prior art selection, and their experts’
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`assignments, to focus on the priority date that Blitzsafe had proffered from the beginning of the
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`case. This severe prejudice to Defendants further supports granting the present motion to strike.
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`Furthermore, Blitzsafe’s actions make it more difficult for this case to proceed according to
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`schedule, because Blitzsafe has now created a new dispute regarding the priority date of the ’342
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`Patent, after the close of fact discovery and expert disclosures. See SoftVault, 2007 U.S. Dist.
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`LEXIS 33060, at *5–6 (emphasizing that the defendant would be forced to “incur additional
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`expense in reassessing its invalidity analyses based on an earlier priority date,” and it “would
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`also likely lose the ability to use references that are prior art under the currently asserted priority
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`date.”); see also Realtime Data, 2009 U.S. Dist. LEXIS 73217, at *37 (denying leave to amend
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`contentions because the lawsuit had “reached a stage where changing the framework for this
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`litigation would be significantly prejudicial to Defendants”); Dataquill Ltd. v. Huawei Techs.
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`Co., No. 2:13-cv-633, 2015 U.S. Dist. LEXIS 179476, at *10 (E.D. Tex. June 11, 2015)
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`(excluding expert reference to an earlier invalidity reference priority date since plaintiff was not
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`on adequate notice during discovery). This case has proceeded through months of discovery
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`based on that information, and the trial is rapidly approaching. It is simply too late for Blitzsafe
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`to raise a new claim of priority and identify new documents in its rebuttal expert report that
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`would upset all of the work that Defendants have undertaken so far to prepare their invalidity
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`defenses for trial. Blitzsafe has effectively denied Defendants an adequate opportunity to
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`prepare their defenses. Accordingly, the Court should grant the present motion and exclude any
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`reliance by Blitzsafe on the earlier priority date and the undisclosed documents.
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`10
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 14 of 21 PageID #: 8388
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`C.
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`Balancing the Relevant Factors Favors Granting Defendants’ Motion to
`Strike
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`The priority date to which the ’342 Patent is ultimately entitled is important to the
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`invalidity analysis in this case, but any prejudice resulting from granting the present motion
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`would not be unfair to Blitzsafe. Instead, it would be the just result of Blitzsafe’s lack of
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`diligence and the severe prejudice to Defendants resulting from Blitzsafe’s failure to comply
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`with its P. R. 3-1(e) and P. R. 3-2(b) disclosure obligations. In evaluating the importance of
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`evidence that may be excluded for failure to comply with the Local Patent Rules, this Court has
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`balanced the importance of the evidence, the culpability of the party facing exclusion, and the
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`prejudice to the party against whom the evidence would be introduced. Here, this balancing
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`favors exclusion.
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`In SoftVault, the Court recognized that “[p]riority dates are an important element in
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`patent infringement cases,” as “[a]n earlier priority date would necessarily shrink the relevant
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`body of prior art and could have a large impact on [the defendant’s] invalidity analyses.”
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`SoftVault, 2007 U.S. Dist. LEXIS 33060, at *5. But ultimately, that did not outweigh the other
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`relevant factors, and the Court denied the plaintiff’s motion for leave to amend its infringement
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`contentions to assert an earlier priority date. See id. at *4–6. In Realtime Data, while the Court
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`recognized that the amendments the plaintiff wanted to make to its infringement contentions
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`were “important to a degree,” “Plaintiff’s lack of diligence in seeking leave to amend, combined
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`with the severe prejudice Defendants would face . . . outweigh[ed] the importance of allowing
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`the proposed amendments.” Realtime Data, 2009 U.S. Dist. LEXIS 73217, at *33–34. In Tyco
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`Healthcare, the culpability of the party facing exclusion was key. “There [was] no evidence . . .
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`that Applied did not have sufficient information to provide the appropriate disclosures in a timely
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`manner,” and, therefore, the Court concluded that “[h]ad they been important, Applied would
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 15 of 21 PageID #: 8389
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`have disclosed them in its Invalidity Contentions at the outset.” See Tyco Healthcare, 2009 U.S.
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`Dist. LEXIS 125379, at *12–13.
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`Here, the importance of the earlier priority date and the undisclosed documents to
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`Blitzsafe is substantially outweighed by Blitzsafe’s culpability and the potential prejudice to
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`Defendants. Blitzsafe could have produced the documents and attempted to claim an earlier
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`priority date for the ’342 Patent at the outset, but it waited until fact discovery had closed before
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`citing the undisclosed documents and making the priority claim in the McAlexander Validity
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`Reports. This untimely disclosure threatens all of the work that Defendants have undertaken to
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`prepare their invalidity defenses. It also raises a new issue regarding whether Clayton is prior art
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`to the ’342 Patent, which was never before an issue in this case. Even a continuance is unlikely
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`to cure the threatened harm. See, e.g., SoftVault, 2007 U.S. Dist. LEXIS 33060, at *6 (“a
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`continuance would not cure prejudice to Microsoft arising from a narrowed body of prior art”).
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`Furthermore, waiting until the end of the case to manufacture a new dispute regarding the
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`priority date of the ’342 Patent is contrary to the purposes of the Local Patent Rules, which are
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`designed to focus discovery early in the case and narrow the issues for trial. In a case such as
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`this one, where Blitzsafe’s failure to comply with the Local Patent Rules is utterly without
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`explanation or justification, exclusion is the fair and the just outcome.
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`IV. GRANTING BLITZSAFE LEAVE TO AMEND ITS INFRINGEMENT
`CONTENTIONS WOULD ALSO BE UNFAIRLY PREJUDICIAL TO
`DEFENDANTS AND JEOPARDIZE THE TRIAL DATE
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`Should the Court analyze this motion to strike under the standard applicable when a
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`plaintiff moves to amend its infringement contentions, the same result should be reached. No
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`amendment should be permitted, and the Court should strike the portions of the McAlexander
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`Validity Reports that are based on a priority date earlier than the June 27, 2006 priority date
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`asserted in Blitzsafe’s infringement contentions and the undisclosed documents. Patent Rule 3-6
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`provides that infringement contentions “shall be deemed to be . . . final contentions.” P. R. 3-
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`6(a). “[U]nless an exception applies, amending those contentions requires the moving party to
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`show good cause.” EMG Tech., LLC v. Chrysler Grp., LLC, No. 6:12-cv-259, 2013 U.S. Dist.
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`LEXIS 189413, at *4 (E.D. Tex. July 3, 2013) (citing P. R. 3-6(b)).
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`When evaluating a motion for leave to amend, the Court considers the following
`factors: “(1) the explanation for the failure to meet the deadline; (2) the
`importance of the thing that would be excluded; (3) potential prejudice in
`allowing the thing that would be excluded; and (4) the availability of a
`continuance to cure such prejudice.”
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`Id. at *4–5 (quoting Arbitron, Inc. v. Int’l Demographics, Inc., No. 2:06-cv-434, 2009 U.S. Dist.
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`LEXIS 3191, at *3–4 (E.D. Tex. Jan. 16, 2009)). Each of these factors is addressed in the
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`preceding analysis. On balance, they weigh heavily in favor of denying leave to amend and
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`granting the present motion to strike.
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`V.
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`CONCLUSION
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`For the reasons provided above, Defendants respectfully request that the Court strike the
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`portions of the McAlexander Validity Reports that are based on a priority date of the ’342 Patent
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`earlier than the June 27, 2006 priority date asserted in Blitzsafe’s infringement contentions and
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`the conception documents that Blitzsafe never produced.
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`Case 2:15-cv-01274-JRG-RSP Document 212 Filed 11/03/16 Page 17 of 21 PageID #: 8391
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`Dated: November 3, 2016
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`Respectfully submitted,
`
`/s/ Joseph M. Beauchamp
`Joseph M. Beauchamp
`Texas State Bar No. 24012266
`Email: jbeauchamp@jonesday.com
`H. Albert Liou
`Texas State Bar No. 24061608
`Email: aliou@jonesday.com
`Erin C. Dickerman
`Texas State Bar No. 24087358
`Email: edickerman@jonesday.com
`JONES DAY
`717 Texas Street, Suite 3300
`Houston, Texas 77002-2712
`Telephone: (832) 239-3939
`Facsimile: (832) 239-3600
`
`Joseph Melnik
`California State Bar No. 255601
`Email: jmelnik@jonesday.com
`JONES DAY
`1755 Embarcadero Road
`Palo Alto, California 94303
`Telephone: (650) 739-3939
`Facsimile: (650) 739-3900
`
`Randy A