Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 1 of 9 PageID #: 14795
`
`
`AGIS SOFTWARE DEVELOPMENT LLC,
`
`
`Plaintiff,
`
`
`
`v.
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`§
`
`§
`Case No. 2:22-cv-00263-JRG
`§
`
`JURY TRIAL DEMANDED
`§
`§
`
`§
`§
`§
`§
`§
`§
`§
`§
`
`
`
`
`SAMSUNG ELECTRONICS CO., LTD. and
`SAMSUNG ELECTRONICS AMERICA,
`INC.,
`
`
`
`Defendants.
`
`
`
`PLAINTIFF AGIS SOFTWARE DEVELOPMENT LLC’S SUR-REPLY IN FURTHER
`OPPOSITION TO DEFENDANTS SAMSUNG ELECTRONICS CO., LTD. AND
`SAMSUNG ELECTRONICS AMERICA, INC.’S MOTION FOR LEAVE TO AMEND
`ANSWER TO ADD ISSUE PRECLUSION AFFIRMATIVE DEFENSE (DKT. 155)
`
`
`
`
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 2 of 9 PageID #: 14796
`
`TABLE OF CONTENTS
`
`Page(s)
`
`THE GOOD CAUSE FACTORS DO NOT FAVOR GRANTING LEAVE .................. 1
`
`THE PROPOSED AMENDMENT IS FUTILE ............................................................... 3
`
`CONCLUSION ................................................................................................................. 4
`
`
`I.
`
`II.
`
`III.
`
`
`
`
`
`i
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 3 of 9 PageID #: 14797
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Cases
`
`ArcelorMittal Atlantique et Lorraine v. AK Steel Corp.,
`908 F.3d 1267 (Fed. Cir. 2018)..............................................................................................2, 4
`
`Colida v. Qualcomm Inc.,
`128 F. App’x 765 (Fed. Cir. 2005) ............................................................................................2
`
`Langley v. Prince,
`926 F.3d 145 (5th Cir. 2019) .....................................................................................................3
`
`Martinez v. Nueces Cnty., Tex.,
`71 F.4th 385 (5th Cir. 2023) ......................................................................................................4
`
`Papst Licensing v. Samsung Elecs. Co.,
`No. 6:18-cv-00388-RWS, Dkt. 399 (E.D. Tex., March 12, 2020) ............................................3
`
`Stevens v. St. Tammany Parish Gov’t,
`17 F.4th 563 (5th Cir. 2021) ......................................................................................................3
`
`TQ Delta, LLC v. CommScope Holding Co.,
`No. 2:21-CV-00310-JRG, 2023 WL 2145502 (E.D. Tex. Feb. 21, 2023) ............................2, 3
`
`Other Authorities
`
`Fed. R. Civ. P. 8(c) ..........................................................................................................................1
`
`Fed. R. Civ. P. 8(c)(1) ......................................................................................................................1
`
`Fed. R. Civ. P. 8(d)(2)......................................................................................................................1
`
`
`ii
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 4 of 9 PageID #: 14798
`
`Samsung’s Reply makes clear that no final judgment exists to support any issue preclusion
`
`defense and “requests denial without prejudice to renew the Motion when final judgment issues.”
`
`Reply at 1, n.1.
`
`Samsung does not dispute its issue preclusion affirmative defense was untimely and waived
`
`for failure to comply with the affirmative pleading requirements under Fed. R. Civ. P. 8(c)(1) and
`
`instead attempts to feign ignorance of AGIS’s claims against FMD. There is also no dispute that
`
`no final judgment exists that can be asserted under the doctrine of issue preclusion. Under
`
`governing Fifth Circuit precedent applying a strict standard of finality, Samsung’s Motion should
`
`be denied in its entirety.
`
`I.
`
`THE GOOD CAUSE FACTORS DO NOT FAVOR GRANTING LEAVE
`
`Samsung Was Not Diligent: Samsung feigns ignorance in arguing “that diligence is
`
`measured from the date of the intervening development that precipitates the request for leave.”
`
`Reply at 1. This unsupported reading of the law disregards Samsung’s own admissions, including
`
`that it failed to comply with the affirmative pleading requirements of Fed. R. Civ. P. 8(c)(1), (d)(2)
`
`despite having ample prior notice of AGIS’s allegations as to FMD and the ’838 Patent when it
`
`filed its 2019 Complaints or when this Court consolidated, designated the lead case, and transferred
`
`the Google I cases to the NDCA in 2020 and 2022, respectively. Samsung ignores and fails to
`
`address that a party’s responsive pleading “must affirmatively state any . . . affirmative defense,
`
`including: . . . estoppel . . . [and] res judicata” and may “set out 2 or more statements of a . . .
`
`defense alternatively or hypothetically, either in a single . . . defense or in separate ones.” Fed. R.
`
`Civ. P. 8(c), 8(d)(2) (emphases added). Because Samsung cannot credibly explain its lack of
`
`diligence, this factor weighs against granting leave.
`
`Samsung Failed to Show Importance: Samsung fails to address the Fifth Circuit’s strict
`
`standard of finality and “acknowledges that final judgment has yet to issue and is necessary for
`
`
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 5 of 9 PageID #: 14799
`
`issue preclusion to attach[.]” Reply at 2. Samsung indeed misses the point and contends that “[a]s
`
`AGIS again ignores, Google has a pending Rule 54(b) motion for final judgment to create an
`
`appealable order[.]” Id. (emphasis added). That is precisely the unrefuted briefing AGIS
`
`presented: absent a final judgment on appeal, a non-final partial SJ Order and interlocutory appeal
`
`is not entitled to preclusive effect. See Opp. at 6-9; TQ Delta, LLC v. CommScope Holding Co.,
`
`No. 2:21-CV-00310-JRG, 2023 WL 2145502, at *3, *7 (E.D. Tex. Feb. 21, 2023).
`
`Samsung offers no legal basis to support its contention that waiting for the non-final partial
`
`SJ Order to be affirmed on appeal “is impractical.” Reply at 2-3. Samsung instead conflates res
`
`judicata and collateral estoppel legal principles, mischaracterizes Colida v. Qualcomm Inc., 128
`
`F. App’x 765, 766 (Fed. Cir. 2005) as “cited by AGIS,” and ignores it cited Colida in its original
`
`Motion and proposed pleading. Compare Reply at 2, n.2 with Mot. at 10-11 and with Mot., Ex. A
`
`at 50-51 ¶ 200. Samsung presents no basis for why it cannot seek leave from this Court when the
`
`non-final partial SJ Order is actually final. This factor thus weighs against granting leave.
`
`AGIS Will Be Prejudiced: Samsung recycles its erroneous arguments as presenting a
`
`“purely legal issue.” Reply at 3. Samsung continues to ignore that absent a final judgment on the
`
`issue, there is no legally viable issue preclusion defense. Furthermore, whether accused products
`
`in a second suit acquire non-infringing status is a question of fact that applies only to the extent
`
`they remain the same, and “‘conduct of a different nature from that involved in the prior litigation’
`
`will not be given preclusive effect.” ArcelorMittal Atlantique et Lorraine v. AK Steel Corp., 908
`
`F.3d 1267, 1274 (Fed. Cir. 2018) (vacating and remanding application of collateral estoppel
`
`because evidence showed material differences between accused products in earlier and subsequent
`
`actions) (quotation and citation omitted). Here, Samsung bears the burden of showing the Samsung
`
`devices at issue here are essentially the same as the Google devices in Google I for issue preclusion
`
`2
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 6 of 9 PageID #: 14800
`
`to apply. Because Samsung failed to adequately put AGIS on notice concerning issue preclusion
`
`with only two months left in fact discovery, allowing its amendment would be prejudicial. See TQ
`
`Delta, 2023 WL 2145502, at *5 (“No party can adequately cultivate a position on an issue that it
`
`was never made aware of in the first place.”). This factor thus weighs against granting leave.
`
`Continuance Will Not Cure Prejudice: Samsung erroneously relies on misplaced
`
`authorities to argue that “[p]reclusion will immediately attach to a final judgment from the NDCA,
`
`without needing to wait for any appeal.” Reply at 3. Langley addressed a criminal conviction where
`
`the Fifth Circuit explained that “[i]n civil cases, the availability of appellate review of the judgment
`
`in the first case is particularly important to its issue-preclusive effect in a second case.” Langley v.
`
`Prince, 926 F.3d 145, 164 (5th Cir. 2019). However, “[t]he principal reason issue preclusion is
`
`narrower in criminal cases than in civil ones is the limited availability of appellate review for the
`
`former.” Id. Furthermore, Stevens applied Louisiana statutory provisions to determine whether a
`
`state court judgment was final. Stevens v. St. Tammany Parish Gov’t, 17 F.4th 563, 571 (5th Cir.
`
`2021). Here, there is no final judgment on the issue, and Samsung would need to request an
`
`indefinite continuance of this case until after the August 2025 trial and any subsequent appeal from
`
`an actual final judgment. This factor therefore weighs strongly against granting leave.
`
`II.
`
`THE PROPOSED AMENDMENT IS FUTILE
`
`Samsung’s Reply ignores governing precedent that amendments that fail to plead sufficient
`
`facts upon which relief can be granted or “would be subject to dismissal, then the amendment[s]
`
`[are] futile and the district court [i]s within its discretion to deny leave to amend.” See Papst
`
`Licensing v. Samsung Elecs. Co., No. 6:18-cv-00388-RWS, Dkt. 399 at 10 (E.D. Tex., March 12,
`
`2020) (“Samsung has failed to plead facts sufficient to plausibly allege that collateral estoppel
`
`applied to Papst’s reexamination arguments and therefore that Papst’s statements/omissions are
`
`misrepresentations. Papst’s supplemental pleading fails to state a claim upon which relief can be
`
`3
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 7 of 9 PageID #: 14801
`
`granted.”); Martinez v. Nueces Cnty., Tex., 71 F.4th 385, 391-2 (5th Cir. 2023) (affirming district
`
`court’s denial of leave as futile) (quotations and citations omitted).
`
`Here, Samsung concedes “a final judgment is required for preclusive effect and has yet to
`
`issue” and conflates appealability and finality. Reply at 4. Samsung’s admission warrants denial
`
`of Samsung’s Motion, and Samsung offers no legal authority applying issue preclusion to a non-
`
`final partial SJ Order, even if certified for interlocutory appeal.
`
`Next, Samsung erroneously attempts to burden-shift the basis for its Motion and resorts to
`
`arguing the merits of “material differences” of FMD. Id. at 4-5. As AGIS explained, AGIS brought
`
`direct infringement claims against Google for its implementation of an old version of FMD on
`
`Google devices in Google I. See Opp. at 14-15. AGIS’s current infringement claims against
`
`Samsung include the implementation of a new version of FMD on Samsung devices. The mere
`
`presence of a version of FMD on the Accused Products does not automatically render them
`
`“essentially the same”—AGIS alleges that Samsung hardware components satisfy numerous
`
`claimed limitations, and those products are sold by an entirely separate infringer. Samsung fails to
`
`plead facts and relies on attorney argument to argue that “FMD operates the same way on all
`
`Android devices capable of running FMD software, including Samsung and Google devices.”
`
`Reply at 5. Samsung also resorts to mischaracterizing AGIS’s cited authority, which vacated and
`
`remanded the application of collateral estoppel because the evidence showed material differences
`
`between accused products in earlier and subsequent actions. ArcelorMittal Atlantique et Lorraine,
`
`908 F.3d at 1274. Accordingly, Samsung’s proposed issue preclusion defense is futile.
`
`III. CONCLUSION
`
`For all the foregoing reasons, AGIS respectfully requests that the Court deny Samsung’s
`
`Motion in its entirety.
`
`4
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 8 of 9 PageID #: 14802
`
`Dated: December 15, 2023
`
`
`
`
`
`
`
`Respectfully submitted,
`
`
`
`
`
`/s/ Alfred R. Fabricant
`Alfred R. Fabricant
`NY Bar No. 2219392
`Email: afabricant@fabricantllp.com
`Peter Lambrianakos
`NY Bar No. 2894392
`Email: plambrianakos@fabricantllp.com
`Vincent J. Rubino, III
`NY Bar No. 4557435
`Email: vrubino@fabricantllp.com
`Enrique W. Iturralde
`NY Bar No. 5526280
`Email: eiturralde@fabricantllp.com
`FABRICANT LLP
`411 Theodore Fremd Avenue,
`Suite 206 South
`Rye, New York 10580
`Telephone: (212) 257-5797
`Facsimile: (212) 257-5796
`
`Samuel F. Baxter
`Texas State Bar No. 01938000
`Email: sbaxter@mckoolsmith.com
`Jennifer L. Truelove
`Texas State Bar No. 24012906
`Email: jtruelove@mckoolsmith.com
`MCKOOL SMITH, P.C.
`104 E. Houston Street, Suite 300
`Marshall, Texas 75670
`Telephone: (903) 923-9000
`Facsimile: (903) 923-9099
`
`ATTORNEYS FOR PLAINTIFF, AGIS
`SOFTWARE DEVELOPMENT LLC
`
`5
`
`

`

`Case 2:22-cv-00263-JRG-RSP Document 161 Filed 12/15/23 Page 9 of 9 PageID #: 14803
`
`CERTIFICATE OF SERVICE
`
`The undersigned hereby certifies that, on December 15, 2023, all counsel of record who
`
`are deemed to have consented to electronic service are being served with a copy of this document
`
`via the Court’s CM/ECF system per Local Rule CV-5(a)(3).
`
`
`
`/s/ Alfred R. Fabricant
` Alfred R. Fabricant
`
`
`
`
`
`
`
`
`
`