Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 1 of 9 PageID #: 33143
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TEXARKANA DIVISION
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`Case No. 5:19-cv-00036-RWS
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`Plaintiff,
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`Defendant.
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`LEAD CASE
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`JURY TRIAL DEMANDED
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`MAXELL, LTD.,
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`v.
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`APPLE INC.,
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`MAXELL, LTD.’S REPLY IN SUPPORT OF ITS OPPOSED MOTION TO SEVER
`NON-SELECTED PATENTS
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 2 of 9 PageID #: 33144
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`Apple knows it must face adjudication of the narrowed patents; it does not seek dismissal
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`with prejudice. But Apple also knows that dismissal without prejudice will only postpone the
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`parties’ trial on these patents for years. So rather than sever the case and face the inevitable in the
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`most efficient, most equitable manner, Apple insists on the option that presents the most delay.
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`If the Non-Selected Patents are severed, the new case picks up where this one left off—
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`ready for trial. There is no prejudice in maintaining the status quo. There is no duplication of work.
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`There is no waste or inefficiency. But there is prejudice, waste, and inefficiency in dismissal. A
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`new case following dismissal will put the parties back at square one facing the prospect of doing
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`again all the work that has been done the last two years, giving Apple a clean slate on claim
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`construction, infringement, validity, damages, and all of Apple’s many failed procedural blocks—
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`all before a new court. Maxell respects that hard decisions had to be made in view of COVID-19,
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`but Maxell should not be forced to shoulder the bulk of the prejudice resulting therefrom. Maxell
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`respectfully requests the Court exercise its discretion to sever to avoid that result.
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`A.
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`Dismissal Is Not The Ordinary Practice For The Circumstances Here
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`Apple asserts it knows of no case supporting Maxell’s request for severance here. But it is
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`Apple’s request that has no support. Apple cites no case where a court ordered dismissal of entire
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`patents from a case purely for the sake of narrowing. Each case Apple cites involved a plaintiff
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`that voluntarily dropped patents before trial and sought neither dismissal nor severance. At most,
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`these cases stand for the proposition that a “Plaintiff’s voluntary election not to pursue certain
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`claims at trial operates as a dismissal without prejudice.” Realtime Data LLC v. Echostar Corp.,
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`No. 6:17-CV-00084-JDL, 2018 WL 6267332, at *4 (E.D. Tex. Nov. 29, 2018) (emphasis added).
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`Given that Maxell’s proposal was not accepted by Apple or adopted by the Court, there has been
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`no voluntary election by Maxell and thus nothing that operates as a dismissal.
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`1
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`Moreover, severance is not the unusual tool Apple claims. Courts regularly employ
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`severance to manage their dockets, accommodate court resources, and ensure that claims timely
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`reach final judgment. See, e.g., Papst Licensing GmbH & Co., KG v. Apple, Inc., No. 6:15-CV-
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`01095-RWS, 2018 WL 3656491, at *1 (E.D. Tex. Aug. 1, 2018) (ordering severance so that case
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`could continue as to patent not subject to post-grant proceedings); Harris Corp. v. Huawei Device
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`USA, Inc., No. 2:18-CV-00439-JRG, 2019 WL 8135570, at *2 (E.D. Tex. June 12, 2019) (ordering
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`severance of defendant’s counter-claimed patents to simplify matter). Maxell does not request that
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`the Court “deviate” from its “ordinary practice,” but that the Court utilize a common tool to resolve
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`the claims concerning the Non-Selected Patents in the most efficient manner.
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`B.
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`Severance Most Efficiently Resolves The Parties’ Dispute As A Whole
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`Given Apple’s focus on judicial economy, its insistence on a result with the most negative
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`impact on judicial economy is peculiar. Apple’s argument rests on resolution of just this one case
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`rather than resolution of the entire dispute over the ten patents asserted in the complaint. Severance
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`and dismissal both permit this case to proceed to final judgment on the six elected patents without
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`delay. Thus, the proper focus now is how to handle the rest of the dispute. Regardless of how the
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`Court rules here, there will be a second case as to the Non-Selected Patents. Given that
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`inevitability, the best way to preserve judicial and party resources is through severance so that the
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`second case can pick up at the pre-trial stages rather than at the beginning, as would be the case if
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`the patents are dismissed. Furthermore, as Maxell explained, starting anew will be in a new district,
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`requiring a new court to expend resources familiarizing itself with the parties and the patents.1 And
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`there is no doubt the new court will have to deal at length with how to handle orders and
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`1 Apple argues the Maxell’s recent filings in W.D. Texas demonstrate that Maxell will not be prejudiced by losing
`its choice of venue. Apple’s argument is nonsensical because the new court—whether in W.D. Texas or elsewhere—
`will still have to expend resources to become familiar with the parties and the patents.
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 4 of 9 PageID #: 33146
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`representations that were rendered in this case.
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`When this case is considered as a whole, the absurdity of Apple’s argument is clear. Apple
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`argues that severance should not be granted because a second trial would be burdensome and
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`wasteful. (Opp. at 5). Instead, Apple urges the Court to dismiss the claims without prejudice such
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`that the parties will not only have to go through a second trial, but also a second set of contentions,
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`fact discovery, claim constructions, depositions, expert reports, expert depositions, summary
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`judgment, and pretrial preparation.2 Apple’s position simply makes no sense.
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`C. Maxell’s Request Is Neither Inconsistent With The Court’s Order On
`Narrowing Nor Does It Expand The Case
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`As set forth in the Joint Status Report on narrowing, the Court and the parties “discussed
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`potential proposals to narrow the issues to be heard at the trial for the above-captioned
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`matter….” D.I. 603 (emphasis added). The purpose of narrowing was to ensure that the issues at
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`trial could be addressed within the abbreviated time available. The parties accomplished that goal.
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`The Court never once addressed what would happen to the non-selected patents.3 Moreover,
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`through severance, Maxell is not injecting new patents or claims. Maxell seeks to maintain,
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`exactly, the scope of this case as it was four months ago when the parties were preparing for a
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`December trial. Filing a new case, as Apple wants, is what raises the possibility of expansion. That
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`is not what Maxell seeks here.
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`D.
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`The Pendency Of Post-Grant Proceedings Is Irrelevant To This Motion
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`That Apple raises the post-grant proceedings at the PTO in its Opposition is as irrelevant
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`2 Apple asserts that a new case need not start from scratch: “many discovery materials would carry over to a follow-
`on case (assuming the parties agreed)….” Opp. at 8 (emphasis added). Agreement is not a safe assumption and
`certainly not one on which Maxell is willing to stake the conduct of future litigations. Indeed, in another case
`pending between the parties before the USITC, Apple refused Maxell’s proposal for the cross-use of discovery
`despite the fact that there are overlapping products and accused features between the two matters.
`3 Apple asserts that the Court adopted its narrowing proposal. That is not so. Apple’s proposal on narrowing
`included that “Maxell would dismiss four of the ten patents from this case.” D.I. 603 at 4 (emphasis added). The
`Court’s order did not include such language. D.I. 619.
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`3
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 5 of 9 PageID #: 33147
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`as it is unsurprising. Apple has sought delay based on such proceedings at every possible chance.
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`But such proceedings do not offer a basis on which to grant or deny Maxell’s motion, particularly
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`when the EPRs have not reached the stage of First Office Actions. See D.I. 636. As stated above,
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`there will be a second case as to the four Non-Selected Patents regardless of the resolution of this
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`dispute. Apple will have the opportunity to address the impact of the PTO proceedings on the Non-
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`Selected Patents there, and thus there is no risk of wastefulness that would result from severance
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`versus dismissal. Indeed, severance would maintain this case before a court that is already well
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`aware of the relevant PTO proceedings. Furthermore, to the extent a PTO proceeding does change
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`the scope of an asserted patent, reopening discovery for the limited purpose of addressing such
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`change is more efficient than starting a new case from the beginning.
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`E.
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`Severance Does Not Render The Court’s Narrowing Order One-Sided
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`Severance would place this case in the same position it was four months ago for the four
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`Non-Selected Patents. There is no inequity to Apple from a severance versus dismissal. Apple did
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`not narrow its invalidity case for the Non-Selected Patents. Ex. D, Apple’s Identification of
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`Narrowed Prior Art Invalidity Challenges. Similarly,
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`the Joint Stipulation Regarding
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`Representative Products for Trial does not apply to the Non-Selected Patents.4 D.I. 625. Thus,
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`there is no benefit to Maxell from Apple’s compliance with its portion of the narrowing order as
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`it concerns those Patents. Severance would merely limit Apple to the positions set forth in its Final
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`Election of Prior Art. To assert that such result is inequitable is to reveal Apple’s true intention—
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`to take another shot at developing positions against the Non-Selected Patents.
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`4 Apple’s argument that it agreed to a representative product stipulation only because it believed Maxell was going
`to dismiss the patents is inapposite. What matters is what the Court ordered. The Court did not make the stipulation
`contingent on dismissal. Notably, Maxell also did not agree to dismiss four of its patents.
`4
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 6 of 9 PageID #: 33148
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`F.
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`The Timing Of Maxell’s Request Does Not Weigh In Favor Of Denial
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`Maxell agreed from the beginning to enter a Focusing Order. D.I. 44. Maxell was willing
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`to further narrow the issues down to 14 claims across eight patents, even in the absence of any
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`invalidity narrowing by Apple. See, e.g., Opp. at 1. Maxell’s ZTE trial proved this was possible.
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`But when the Court expressed concern that trial time would be more limited than anticipated,
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`Maxell offered to narrow its case even more. D.I. 603. As stated in its motion, Maxell was willing
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`to limit its assertions in exchange for the efficient and expedient resolution of the remaining eight
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`patents in a single trial. But Apple did not agree, and Maxell’s proposal was not adopted. There
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`was no reneging. Whereas Maxell had agreed to one trial on eight patents, it never agreed to one
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`trial on six—dismissing almost half of Maxell’s asserted patents. Maxell was ordered to narrow
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`its case beyond what it was willing to do voluntarily, and the parties are left with the question of
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`how to address the remaining patents.
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`There is nothing nefarious about when Maxell raised the severance issue. In December, the
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`Court requested the parties narrow the issues to be heard at trial, not to address what would happen
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`to those issues that were not selected. See D.I. 603. Furthermore, if the Court had adopted Maxell’s
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`proposal, the need for severance would not have arisen. Once the Court did issue its order, and the
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`dispute became ripe, Maxell informed Apple of its intent to file this motion within two days.5 Ex.
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`E, 1/29/21 Email Miller to Jay.
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`G.
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`Conclusion
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`Maxell’s claims on the Non-Selected Patents will be heard. The only remaining question
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`is whether that process will be equitable and efficient, or the patents will be dismissed and an entire
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`new case must begin from scratch. Severance offers the most efficient and equitable option.
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`5 Although Apple criticizes Maxell for not filing its motion until February 12, that is partially based on Apple’s own
`delay in getting back to Maxell with a position on the motion.
`5
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 7 of 9 PageID #: 33149
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`Dated: March 8, 2021
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`By:
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`/s/ Jamie B. Beaber
`Geoff Culbertson
`Kelly Tidwell
`Patton, Tidwell & Culbertson, LLP
`2800 Texas Boulevard (75503)
`Post Office Box 5398
`Texarkana, TX 75505-5398
`Telephone: (903) 792-7080
`Facsimile: (903) 792-8233
`gpc@texarkanalaw.com
`kbt@texarkanalaw.com
`
`Jamie B. Beaber
`Alan M. Grimaldi
`Kfir B. Levy
`James A. Fussell, III
`Baldine B. Paul
`Tiffany A. Miller
`Saqib J. Siddiqui
`Bryan C. Nese
`William J. Barrow
`Alison T. Gelsleichter
`Clark S. Bakewell
`MAYER BROWN LLP
`1999 K Street, NW
`Washington, DC 20006
`Telephone: (202) 263-3000
`Facsimile: (202) 263-3300
`jbeaber@mayerbrown.com
`agrimaldi@mayerbrown.com
`klevy@mayerbrown.com
`jfussell@mayerbrown.com
`bpaul@mayerbrown.com
`tmiller@mayerbrown.com
`ssiddiqui@mayerbrown.com
`bnese@mayerbrown.com
`wbarrow@mayerbrown.com
`agelsleichter@mayerbrown.com
`cbakewell@mayerbrown.com
`
`Robert G. Pluta
`Amanda Streff Bonner
`Mayer Brown LLP
`71 S. Wacker Drive
`Chicago, IL 60606
`(312) 782-0600
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`6
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 8 of 9 PageID #: 33150
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`rpluta@mayerbrown.com
`asbonner@mayerbrown.com
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`Counsel for Plaintiff Maxell, Ltd.
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`7
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`Case 5:19-cv-00036-RWS Document 650 Filed 03/08/21 Page 9 of 9 PageID #: 33151
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that all counsel of record who are deemed to have consented to
`electronic service are being served this 8th day of March 2021, with a copy of this document via
`the Court’s CM/ECF system per Local Rule CV-5(a)(3).
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`/s/ Jamie B. Beaber
`Jamie B. Beaber
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`8
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