Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 1 of 39 PageID #: 16787
`
`
`
`
`
`Exhibit 1
`
`
`
`
`
`
`
`
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 2 of 39 PageID #: 16788
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TEXARKANA DIVISION
`
`MAXELL, LTD.,
`
`Plaintiff,
`
`v.
`
`ZTE CORPORATION and
`ZTE USA INC.,
`
`Defendants.
`
`Case No. 5:16-cv-00179-RWS
`
`JURY TRIAL DEMANDED
`
`REVISED PROPOSED JURY INSTRUCTIONS
`
`1.
`
`Introduction
`
`MEMBERS OF THE JURY:
`
`It is my duty and responsibility to instruct you on the law you are to apply in this case.
`
`The law contained in these instructions is the only law you may follow. It is your duty to follow
`
`what I instruct you the law is, regardless of any opinion that you might have as to what the law
`
`ought to be.
`
`If I have given you the impression during the trial that I favor either party, you must
`
`disregard that impression. If I have given you the impression during the trial that I have an
`
`opinion about the facts of this case, you must disregard that impression. You are the sole judges
`
`of the facts of this case. Other than my instructions to you on the law, you should disregard
`
`anything I may have said or done during the trial in arriving at your verdict.
`
`You should consider all of the instructions about the law as a whole and regard each
`
`instruction in light of the others, without isolating a particular statement or paragraph.
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 3 of 39 PageID #: 16789
`
`The testimony of the witnesses and other exhibits introduced by the parties constitute the
`
`evidence. The statements of counsel are not evidence; they are only arguments. It is important
`
`for you to distinguish between the arguments of counsel and the evidence on which those
`
`arguments rest. What the lawyers say or do is not evidence. You may, however, consider their
`
`arguments in light of the evidence that has been admit- ted and determine whether the evidence
`
`admitted in this trial supports the arguments. You must determine the facts from all the testimony
`
`that you have heard and the other evidence submitted. You are the judges of the facts, but in
`
`finding those facts, you must apply the law as I instruct you.
`
`You are required by law to decide the case in a fair, impartial, and unbiased manner,
`
`based entirely on the law and on the evidence presented to you in the courtroom. You may not be
`
`influenced by passion, prejudice, or sympathy you might have for the plaintiff or the defendant
`
`in arriving at your verdict.
`
`1.1
`
`No Inference from Filing Suit
`
`The fact that a plaintiff brought a lawsuit in this Court seeking damages creates no
`
`inference that the plaintiff is entitled to a judgment. Anyone may make a claim and file a
`
`lawsuit. The act of making a claim in a lawsuit, by itself, does not in any way tend to establish
`
`that claim and is not evidence.
`
`1.2
`
`Direct and Circumstantial Evidence
`
`Some of you may have heard the terms “direct evidence” and “circumstantial evidence.”
`
`Direct evidence is simply evidence like the testimony of an eyewitness which, if you believe it,
`
`directly proves a fact. Circumstantial evidence is simply a chain of circumstances that indirectly
`
`proves a fact. If someone walked into the courtroom wearing a raincoat covered with drops of
`
`2
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 4 of 39 PageID #: 16790
`
`water and carrying a wet umbrella, that would be circumstantial evidence from which you could
`
`conclude that it was raining.
`
`It is your job to decide how much weight to give the direct and circumstantial evidence.
`
`As a general rule, the law makes no distinction between the weights that you should give to
`
`direct and circumstantial evidence, nor does it say that one is any better evidence than the other,
`
`but simply requires that you find the facts from all the evidence, both direct and circumstantial,
`
`and give it the weight you believe it deserves.
`
`1.3
`
`Expert Witnesses
`
`When knowledge of a technical subject matter may be helpful to the jury, a person who
`
`has special training or experience in that technical field is permitted to state his or her opinion on
`
`those technical matters. He or she is called an expert witness. However, you are not required to
`
`accept that opinion. As with any other witness, it is up to you to decide whether the witness's
`
`testimony is believable or not, whether it is supported by the evidence, and whether to rely upon
`
`it. In deciding whether to accept or rely upon the opinion of an expert witness, you may consider
`
`any bias of the witness.
`
`1.4
`
`Deposition Testimony
`
`Certain testimony in this case has been presented to you through a deposition. A
`
`deposition is the sworn, recorded answers to questions asked of a witness in advance of the trial.
`
`Under some circumstances, if a witness cannot be present to testify from the witness stand, the
`
`witness’s testimony may be presented under oath in the form of a deposition. Sometime before
`
`this trial, attorneys representing the parties in this case questioned this witness under oath. A
`
`court reporter was present and recorded the testimony. You should judge the credibility of and
`
`3
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 5 of 39 PageID #: 16791
`
`weigh the importance of deposition testimony to the best of your ability just as if the witness had
`
`testified in court in person.
`
`This deposition testimony is entitled to the same consideration and is to be judged by you
`
`as to the credibility and weight and otherwise considered by you insofar as possible the same as
`
`if the witness had been present and had testified from the witness stand in court.
`
`2.
`
`Summary of Contentions
`
`To help you follow the evidence, I will now give you a summary of the positions of the
`
`parties. The parties in this case are Maxell Ltd. and ZTE (USA) Inc. The case involves seven
`
`United States Patents, which are referred to as “Asserted Patents,” and certain claims of those
`
`patents, which are referred to as “Asserted Claims.”
`
`Maxell contends that ZTE USA infringes the following claims by making, using, selling,
`
`offering for sale, and/or importing into the United States certain ZTE products. Specifically,
`
`Maxell contends that ZTE USA1:
`
`a.
`
`b.
`
`c.
`
`d.
`
`e.
`
`f.
`
`g.
`
`Literally infringes claim 1 of the ’193 Patent;
`
`Literally infringes claims 1-3 of the ’317 Patent;
`
`Literally infringes claim 5 of the ’493 Patent;
`
`Literally infringes claim 1 of the ’729 Patent;
`
`Literally infringes claims 1 and 8 of the ’491 Patent;
`
`Literally infringes claim 1 of the ’695 Patent;
`
`Infringes claims 1 and 2 of the ’794 Patent, literally and under the doctrine of
`
`equivalents.
`
`4
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 6 of 39 PageID #: 16792
`
`Maxell also contends that ZTE USA has committed infringement willfully.2 Maxell is
`
`seeking damages for the alleged infringement of ZTE USA.
`
`ZTE USA contends that it does not infringe any of the Asserted Claims. ZTE USA
`
`contends that it has not infringed any asserted claim of the Asserted Patents. ZTE USA further
`
`contends that:
`
`a. Claims 1-3 of the ’317 Patent are invalid as anticipated by prior art under 35 U.S.C. §
`
`102;
`
`b. Claims 1-3 of the ‘317 Patent are invalid for failing to claim patent-eligible subject
`
`matter under 35 U.S.C. § 101;3
`
`c. Claim 1 of the ’193 Patent is invalid as obvious in view of prior art under 35 U.S.C. §
`
`103;
`
`d. Claims 1-2 of the ’794 Patent are invalid for failing to claim patent-eligible subject
`
`matter under 35 U.S.C. § 101.4
`
`ZTE contends that Maxell is not entitled to any damages award, under any theory,
`
`including a reasonable royalty theory. ZTE USA contends that Maxell’s claims for damages are
`
`barred in whole or in part for failure to mark licensed products with the patent in compliance
`
`2 ZTE’s position is that there should be no willfulness instruction; see explanation in ZTE
`footnote at “5.5 Willful Infringement” instruction.
`
`3 Maxell’s position is that there should be no instruction or contention provided on patent
`eligibility. As Maxell will demonstrate in its Rule 50(a) motion, ZTE has provided no evidence
`at all supporting its contention and certainly has not met its high, clear and convincing evidence
`burden.
`4 Maxell’s position is that there should be no instruction or contention provided on patent
`eligibility. As Maxell will demonstrate in it Rule 50(a) motion, ZTE has provided no evidence at
`all supporting its contention and certainly has not met its high, clear and convincing evidence
`burden.
`
`5
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 7 of 39 PageID #: 16793
`
`with 35 U.S.C. § 287. ZTE USA contends that, if it is found to infringe any asserted claim, no
`
`such infringement has been willful.5
`
`Your job is to decide whether ZTE USA has infringed the asserted claims, and whether
`
`the asserted claims are invalid. If you decide that any asserted claim has been infringed and is not
`
`invalid, you will then need to decide the amount of money damages to be awarded to Maxell to
`
`compensate Maxell for the infringement, if any.
`
`You will also need to make a finding as to whether the infringement was willful. If you
`
`decide that any infringement was willful, that decision should not affect any damages award you
`
`make. I will take willfulness into account later.
`
`2.1
`
`Representative Product
`
`For purposes of this case, the parties agree that certain products are representative of
`
`other products. That means that proof of infringement or non-infringement of a representative
`
`product shall be treated as proof for the other products that it represents. Specifically, for the
`
`purposes of infringement or non-infringement, the following products are representative, and
`
`proof of infringement or non-infringement about the following products is proof for the products
`
`they each represent:
`
`a. The ZMax 2 with pre-installed AT&T Navigator is representative of products accused
`
`of infringing the ’317 Patent;
`
`b. The ZMax 2 is representative of products accused of infringing the ’193 Patent and
`
`the ’794 Patent;
`
`c. The ZMax 2 is representative of products accused of infringing the ’491 Patent,
`
`5 ZTE’s position is that there should be no willfulness instruction; see explanation in ZTE
`footnote at “5.5 Willful Infringement” instruction.
`
`6
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 8 of 39 PageID #: 16794
`
`except for the Axon 7;
`
`d. The Zmax 2 is representative of products accused of infringing the ’695 Patent,
`
`except the Axon 7;
`
`e. The Max Duo LTE is representative of products accused of infringing the ’729
`
`Patent, except for the Axon 7; and
`
`f. The Max Duo LTE is representative of products accused of infringing the ’493
`
`Patent, except for the Axon 7.
`
`A complete list of accused products by patent is included as Appendix B to these Jury
`
`Instructions.
`
`3.
`
`Burdens of Proof
`
`Facts must be proved by a required standard of evidence known as the burden of proof.
`
`You’ve heard about it, I’m sure, from television and probably in criminal cases with reference to
`
`proof beyond a reasonable doubt. That does not apply in a civil case like this. In a patent case
`
`like this one, there are two burdens of proof that you will apply: The preponderance of the
`
`evidence standard and the clear and convincing evidence standard.
`
`Maxell must prove its claims of patent infringement, willfulness6, marking and damages
`
`by a preponderance of the evidence. When a party has the burden of proof by a preponderance of
`
`the evidence, it means that you must be persuaded that what the party seeks to prove is more
`
`likely so than not so. If you put the evidence for and against the party who must prove the fact
`
`on opposite sides of the scale, the preponderance of the evidence requires that the scale tip
`
`somewhat toward the party who has the burden of proof.
`
`6 ZTE’s position is that there should be no willfulness instruction; see explanation in ZTE
`footnote at “5.5 Willful Infringement” instruction.
`
`7
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 9 of 39 PageID #: 16795
`
`Now, ZTE USA has the burden of proving invalidity of the patent claims by clear and
`
`convincing evidence. That means evidence that produces in your mind a firm belief or conviction
`
`as to the truth of the matter at issue. Although proof to a certainty is not required, the clear and
`
`convincing standard requires a greater degree of persuasion than is necessary for the
`
`preponderance of the evidence standard.
`
`4.
`
`Claims of the Patents-in-Suit
`
`The claims of a patent are the numbered sentences at the end of the patent. The claims
`
`describe the invention made by the inventor and describe what the patent owner owns and what
`
`the patent owner may prevent others from doing. Claims may describe products, methods and
`
`apparatus such as machines or chemical compounds, or processes for making or using a product.
`
`The claims are important because it is the words of the claims themselves that define
`
`what a patent covers. The figures and text in the rest of the patent provide a description and/or
`
`examples of the invention and provide a context for the claims, but it is the claims that define the
`
`breadth of the patent’s coverage. Each claim is effectively treated as if it were a separate patent,
`
`and each claim may cover more or less than another claim. Therefore, what a patent covers
`
`depends upon what each of its claims cover.
`
`You will first need to understand what each claim covers in order to decide whether or
`
`not there is infringement of the claim and to decide whether or not the claim is invalid. The law
`
`says that it’s my role to define the terms of the claims, and it’s your role to apply these
`
`definitions to the issues that you are asked to decide in this case.
`
`Therefore, as I explained to you at the start of the case, I have determined the meaning of
`
`certain claim terms at issue in this case and I have provided you those definitions in Appendix A.
`
`You must accept the definitions of these words in the claims as being correct. It is your job to
`
`8
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 10 of 39 PageID #: 16796
`
`take these definitions and apply them to the issues that you are deciding, including infringement
`
`and validity. The claim language I have not interpreted for you is to be given its ordinary and
`
`accustomed meaning as understood by one of ordinary skill in the art.
`
`4.1
`
`Level of Ordinary Skill
`
`In deciding what the level of ordinary skill is in the field of each claimed invention, you
`
`should consider all the evidence introduced at trial, including but not limited to: (1) the levels of
`
`education and experience of the inventor and other persons actively working in the field; (2) the
`
`types of problems encountered in the field; (3) prior art solutions to those problems; (4) rapidity
`
`with which innovations are made; and (5) the sophistication of the technology.
`
`4.2
`
`How a Patent Claim Defines What It Covers
`
`I will now explain how a patent claim defines what it covers. A claim sets forth, in words,
`
`a set of requirements. Each claim sets forth its requirements in a single sentence. If a device or
`
`system satisfies each of these requirements, then it is covered by the claim. In patent law, the
`
`requirements of a claim are often referred to as “claim elements” or “claim limitations.”
`
`When a thing (such as a feature, product, process, or system) meets all of the
`
`requirements of a claim, the claim is said to “cover” that thing, and that thing is said to “fall”
`
`within the scope of that claim. In other words, a claim covers a feature, product, process, or
`
`system where each of the claim elements or limitations is present in that feature, product,
`
`process, or system. Conversely, if the feature, product, process, or system meets only some, but
`
`not all, of the claim elements or limitations, then that feature, product, process, or system is not
`
`covered by the claim.
`
`By understanding the meaning of the words in a claim and by understanding that the
`
`words in a claim set forth the requirements that a product must meet in order to be covered by
`
`9
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 11 of 39 PageID #: 16797
`
`that claim, you will be able to understand the scope of coverage for each claim. Once you
`
`understand what each claim covers, then you are prepared to decide the issues that you will be
`
`asked to decide, such as infringement and invalidity.
`
`4.3
`
`Independent and Dependent Claims
`
`This case involves two types of patent claims: independent claims and dependent claims.
`
`An “independent claim” sets forth all of the requirements that must be met in order to be
`
`covered by that claim. Thus, it is not necessary to look at any other claim to determine what an
`
`independent claim covers. In this case, for example, claim 1 of the ’317 Patent is an independent
`
`claim.
`
`Other claims in the case are “dependent claims.” A dependent claim refers to another
`
`claim and includes all the requirements or parts of the claim to which it refers. In this case, for
`
`example, claim 2 of the ’317 Patent depends from claim 1. In this way the claim “depends” on
`
`another claim. The dependent claim then adds its own, additional requirements. To determine
`
`what a dependent claim covers, it is necessary to look at both the dependent claim and any other
`
`claims to which it refers. A feature, product or method that meets all of the requirements of both
`
`the dependent claim and the claims to which it refers is covered by that dependent claim.
`
`4.4
`
`Claim Interpretation
`
`I will now explain to you the meaning of some of the words of the claims in this case. In
`
`doing so, I will explain some of the requirements of the claims. As I have previously instructed
`
`you, you must accept my definition of these words in the claims as correct. Those definitions are
`
`provided for you in Appendix A . For any words in the claim for which I have not provided you
`
`with a definition, you should apply their common meaning. You should not take my definition of
`
`the language of the claims as an indication that I have a view regarding how you should decide
`
`10
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 12 of 39 PageID #: 16798
`
`the issues that you are being asked to decide, such as infringement and validity. These issues are
`
`yours to decide.
`
`For some constructions I refer to the structure required by the term as being described in
`
`a portion of the patent identified by column and line number, and/or in a Figure of the patent.
`
`Those are what we call means plus function terms. I will explain those now.
`
`4.5
`
`“Means-plus-function” Claims
`
`Asserted Claim 1 of the ’491 Patent and Asserted Claim 1 of the ‘794 Patent have
`
`limitations phrased as a “means for” performing a function. This “means for” phrase has a
`
`special meaning in patent law. It is called a “means-plus-function” requirement. These
`
`limitations do not cover all of the structures that could perform the functions set forth in the
`
`claim. Instead, each such limitation covers a structure or a set of structures that performs that
`
`function and that is either identical or “equivalent” to the structure(s) described in the patent for
`
`performing that function. The issue of whether two structures are identical or equivalent is for
`
`you to decide. I will explain to you later how to determine whether two structures or two sets of
`
`structures are “equivalent” to one another
`
`For purposes of this case, I have identified for you the structures described in the ’491
`
`Patent and ‘794 Patent that perform the various functions recited in the asserted claims. These
`
`are listed in Appendix A along with the other definitions for the different claim terms. When I
`
`read you my definitions for certain claim terms a few moments ago, I identified the structures
`
`described in the ’491 Patent for performing the relevant functions. You should apply my
`
`definition of the function and the structures described in the ’491 Patent for performing it as you
`
`would apply my definition of any other claim term.
`
`5.
`
`Infringement
`
`11
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 13 of 39 PageID #: 16799
`
`Any person or business entity who makes, uses, sells, offers to sell, or imports into the
`
`United States a product or practices a method that is covered by at least one claim of a patent
`
`infringes the patent. A patent owner has the right to stop others from making, using, selling and
`
`offering for sale, and importing into the United States the invention covered by the patent claims
`
`during the life of the patent.
`
`5.1
`
`Direct Infringement by “Literal Infringement”
`
`There are two types of “direct infringement”: (1) “literal infringement” and (2)
`
`“infringement under the doctrine of equivalents.”
`
`In order to prove direct infringement by literal infringement, Maxell must prove that ZTE
`
`USA made, used, sold, offered for sale within, or imported into the United States an Accused
`
`Product that meets all of the requirements of an Asserted Claim and did so without the
`
`permission of Maxell during the time the patent-in-suit was in force. You must compare the
`
`Accused Product with each and every one of the requirements of a claim to determine whether
`
`all of the requirements of that claim are met.
`
`You must determine, separately for each asserted claim, whether or not there is
`
`infringement. There is one exception to this rule. If you find that a claim on which other claims
`
`depend is not infringed, there cannot be infringement of any dependent claim that refers directly
`
`or indirectly to that independent claim. On the other hand, if you find that an independent claim
`
`has been infringed, you must still decide, separately, whether the accused product meets
`
`additional requirements of any claims that depend from the independent claim, thus, whether
`
`those claims have also been infringed. A dependent claim includes all the requirements of any of
`
`the claims to which it refers plus additional requirements of its own.
`
`5.2
`
`Direct Infringement by “Literal Infringement” of 35 U.S.C. Section 112, Paragraph
`6 Claim Requirements
`
`12
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 14 of 39 PageID #: 16800
`
`As I have previously explained, Asserted Claim 1 of the ’491 Patent and Asserted Claim
`
`1 of the ‘794 Patent include requirements that are in means-plus-function form. A product or a
`
`process infringes the claim if: (1) it has a structure that performs the identical function recited in
`
`the claim, and (2) that structure is either identical or “equivalent” to one or more of the described
`
`structures that I defined in Appendix A as performing the function. If the Accused Product does
`
`not perform the specific function recited in the claim, the “means-plus-function” requirement is
`
`not met, and the Accused Product does not literally infringe the claim. Alternatively, even if the
`
`Accused Product has a structure that performs the function recited in the claim but the structure
`
`is not either identical or “equivalent” to one or more of the structures that I defined in Appendix
`
`B, the Accused Product does not literally infringe the asserted claim. In order to prove direct
`
`infringement by literal infringement of a means-plus-function limitation, Maxell must prove the
`
`above requirements are met.
`
`5.3
`
`Direct Infringement Under the Doctrine of Equivalents
`
`If ZTE USA makes, uses, sells, offers to sell within, or imports into the United States an
`
`Accused Product that does not meet all of the requirements of a claim and thus does not literally
`
`infringe that claim, there can still be direct infringement if that Accused Product satisfies the
`
`claim “under the doctrine of equivalents.” Under the doctrine of equivalents, an Accused Product
`
`infringes a claim if the Accused Product contains elements or performs steps corresponding to
`
`each and every requirement of the claim that is equivalent to, even though not literally met by,
`
`the Accused Product. You may find that an element or step is equivalent to a requirement of a
`
`claim that is not met literally if a person having ordinary skill in the field of technology of the
`
`patent would have considered the differences between them to be “insubstantial” or if you find
`
`that the structure or action: (1) performs substantially the same function and (2) works in
`
`13
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 15 of 39 PageID #: 16801
`
`substantially the same way (3) to achieve substantially the same result as the requirement of the
`
`claim. In order for the structure or action to be considered interchangeable, the structure or action
`
`must have been known at the time of the alleged infringement to a person having ordinary skill
`
`in the field of technology of the patent.
`
`You may also consider whether, at the time of the alleged infringement, a person having
`
`ordinary skill in the field of technology of the patent would have known of the interchangeability
`
`of the alternative feature and the unmet requirement of the claim. Interchangeability at the
`
`present time is not sufficient proof of infringement under the doctrine of equivalents. In order for
`
`the structures to be considered interchangeable, the interchangeability of the two structures must
`
`have been known to persons of ordinary skill in the field of technology at the time the
`
`infringement began
`
`5.4
`
`Preambles
`
`The beginning portion, or preamble of a claim is the portion of the claim prior to the
`
`word “comprises” or “comprising.” The Court’s Constructions at Appendix A include
`
`information about whether certain “preambles” are limiting. Where the Court has made this
`
`determination, you must follow the Court’s Construction. Where the Court has not indicated
`
`whether a preamble is limiting, then "comprising" and "comprises" mean "including but not
`
`limited to, "or "containing but not limited to." Thus, if you decide that an accused feature
`
`includes all the requirements in that claim, the claim is infringed. This is true even if the accused
`
`instrumentality includes components in addition to those requirements. For example, a claim to a
`
`table comprising a tabletop, legs, and glue would be infringed by a table that includes a tabletop,
`
`legs, and glue, even if the table also includes wheels on the table's legs.
`
`14
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 16 of 39 PageID #: 16802
`
`5.5 Willful Infringement7
`
`7
`ZTE’s position is that there should be no willfulness instruction because no evidence
`legally sufficient to support a finding of willfulness was presented. See Practice Note to AIPLA
`Model Patent Jury Instruction No. 12 “Willful Infringement- Generally” (“The following
`Instruction should be given only if the patent owner contends willful infringement and has
`introduced sufficient evidence to support this contention.”) (emphasis added). If a willful
`instruction must be included however, ZTE prefers this version, which is a direct copy of Jury
`Instruction No. 4. (Willful Infringement), VirnetX v. Apple, Case 6:12-cv-00855-RWS, Dkt. 727
`(April 12, 2018).
`Maxell failed to present evidence sufficient to prove willfulness. Maxell must show risk
`of infringement was either known by ZTE USA or so obvious that it should have been known by
`the accused infringer. See Arctic Cat Inc. v. Bombardier Recreational Products Inc., 876 F.3d
`1350, 1371 (Fed. Cir. 2017). Maxell’s case hinges on argument that ZTE Corporation
`communicated with a Maxell predecessor regarding infringement of the ‘317 by the Sprint Fury
`product. (During Mr. Nakamura’s deposition, counsel for Maxell stated that it did not have any
`evidence of willfulness other than this communication; see Depo. Tr. Nakamura at 127:16-19
`(“Maxell can represent that it has no basis for willful infringement outside of the prior
`negotiations with respect to Hitachi or Maxell and ZTE.”) But during this trial, Maxell offered
`no evidence that any notice was provided to ZTE USA that an asserted patent reads on an
`accused product. Maxell only attempted to show that it communicated with ZTE Corporation, a
`different entity, regarding the ‘317 as it allegedly was infringed by the Sprint Fury, a non-
`accused product.
`Maxell has not presented any evidence that ZTE Corp imputed knowledge to ZTE USA.
`Case law states that more than a parent-child corporate relationship is necessary to impute
`knowledge. “Knowledge of a patent by a parent corporation is not necessarily imputed to its
`subsidiary.” See ZitoVault, LLC v. International Bus. Machines Corp., Civil Action No. 3:16-cv-
`0962-M, 2018 WL 2971131, *3 (N.D. Tex. Mar. 29, 2018) (something “more than just the bare
`facts of the parent/subsidiary relationship is necessary” to establish that the subsidiary has
`knowledge of a patent.) Nor has Maxell offered evidence showing that ZTE USA was put on
`notice that any accused product infringed a patent in suit, or that anyone at ZTE USA knew or
`should have been aware of infringement by other products because the Sprint Fury functions like
`any accused product.
`Maxell has addressed ZTE’s objection on this issue during the informal charge conference. As
`Maxell noted, there has been ample evidence to establish willfulness, including: a designated
`ZTE USA witness, Mr. Tian Dao, testifying on behalf of ZTE regarding knowledge of the
`Asserted Patents. Although ZTE may now prefer to treat Mr. Dao exclusively as a representative
`of ZTE Corp., he in fact was testifying as a representative of ZTE USA. His testimony and
`knowledge of the meetings and negotiations involving the Asserted Patents are therefore be
`attributed to ZTE USA. In addition, Messrs. Nakamura and Dao confirmed that US patents were
`at issue in those discussions, which can cover only US sales that would be made by ZTE USA.
`Mr. Nakamura further confirmed that discussions with ZTE covered sales of ZTE phones in the
`US, which sales are made by ZTE USA. This is hardly limited to “just the bare facts of the
`parent/subsidiary relationship.”
`
`15
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 17 of 39 PageID #: 16803
`
`Maxell contends that ZTE USA willfully infringed the patents-in-suit. Willfulness
`
`requires you to determine whether ZTE USA proved that it is more likely than not that the
`
`infringement by Maxell was especially worthy of punishment. You may not determine that the
`
`infringement was willful just because ZTE USA knew of a patent and infringed it. Instead,
`
`willful infringement is reserved for only the most egregious behavior, such as where the
`
`infringement is malicious, deliberate, consciously wrongful, or done in bad faith. You must base
`
`your decision on ZTE USA’s knowledge at the time of infringement.
`
`To determine whether ZTE USA acted willfully for any of the patents-in-suit, consider all
`
`facts. These may include, but are not limited, to:
`
`a. Whether or not ZTE USA acted consistently with the standards of behavior for its
`industry;
`b. Whether or not ZTE USA intentionally copied a product of Maxell that is covered
`by a patent-in-suit;
`c. Whether or not ZTE USA reasonably believed it did not infringe;
`
`Maxell also presented evidence of ZTE’s knowledge and awareness of several of the patents in
`suit, through both testimony (Messrs. Nakamura and Dao) and documentary evidence (numerous
`negotiations and notice documents). Furthermore, in at least one of these documents, ZTE
`acknowledges that its smartphone products embody claims of the ’317 patent. Mr. Nakamura
`also confirmed that there were other discussions involving “ZTE smartphones.” He testified:
`A. Yes.
`On the second page, this is an executive summary
`presentation of Maxell's smartphone portfolio. Since we
`had -- since the claim charts were already sent, we added
`explanation of additional patents that we believe the ZTE
`smartphones infringe in this chart -- presentation.
`Q. Are any of the patents asserted in this case identified
`in this exhibit?
`A. Yes.
`On the right side in the yellow box, there is the
`'317 patent; and on the left side in the camera box, '493
`patent; and at the bottom, there is the '794 patent.
`[June 20 (morning) at 84:15-25] This evidence is sufficient to show that ZTE was aware of at
`least some of the asserted patents, and was aware its smartphones infringed at least some of the
`asserted patents. And the evidence establishes that, even if ZTE USA was not made directly
`aware of these issues, ZTE Corp.’s knowledge can be imputed to ZTE USA.
`
`16
`
`

`

`Case 5:16-cv-00179-RWS Document 287-4 Filed 08/07/18 Page 18 of 39 PageID #: 16804
`
`d. Whether or not ZTE USA mad