Case 6:21-cv-00569-ADA Document 126 Filed 12/27/22 Page 1 of 7
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`WACO DIVISION
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`TOUCHSTREAM TECHNOLOGIES, INC.,
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`Plaintiff,
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`v.
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`GOOGLE LLC,
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`Civil Case No. 6:21-cv-569-ADA
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`JURY TRIAL DEMANDED
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`U.S. District Judge Alan Albright
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`Defendant.
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`TOUCHSTREAM TECHNOLOGIES, INC.’S REPLY IN SUPPORT OF OBJECTIONS
`TO AND APPEAL FROM NOVEMBER 29, 2022 MAGISTRATE JUDGE’S ORDER
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`INTRODUCTION
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`Foreign damages are recoverable where, as undisputed here, infringing software methods
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`performed abroad were designed, developed, engineered, and tested in the United States. Stated
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`differently, Touchstream may recover reasonable royalties for, among other things, Google’s
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`domestic acts of infringement under 35 U.S.C. § 271(a) that are the but-for cause of devices located
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`abroad practicing infringing methods. The Magistrate Judge’s November 29, 2022 order, which
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`ruled otherwise, was contrary to law. Google’s arguments (a) on the merits of this pure legal issue,
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`(b) that this Court should defer to the Magistrate Judge on a pure legal and, moreover, dispositive
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`ruling, and (c) that Touchstream’s objection was untimely and thus waived (ECF No. 123), all lack
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`merit. Touchstream respectfully requests that the Court sustain the objection.
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`I.
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`Touchstream’s Objection Was Timely and Not Waived
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`ARGUMENT
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`On November 29, 2022, Judge Gilliland entered a written order stating his decision on
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`Touchstream’s motion to compel Google to produce, among other things, global usage metrics
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`relevant to foreign damages. ECF No. 111. Fourteen days later, on December 13, 2022,
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`Touchstream filed its objections to the November 29 order. ECF No. 119. This objection was
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`timely. See Fed. R. Civ. P. 72 (objections are due 14 days from the “written order”); Local Court
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`Rule Appx. C-4(b) (objections are due 14 days from the “order”).
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`Google argues that Touchstream should have timed its objections not from the November
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`29 written order, but from the November 16, 2022 hearing on Touchstream’s motion, at which
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`Judge Gilliland stated orally that he was “going to deny the request for global revenues.” Mot. Ex.
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`2 at 33:16-17. However, a purported 14-day requirement from this oral, future-tense ruling: (a)
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`was not required under Rule 72 or Local Court Rule Appx. C-4(b); (b) is not supported by a single
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`case cited by Google, none of which held that an oral ruling, rather than a subsequent order, triggers
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`the 14-day deadline; (c) is contrary to precedent, see, e.g., La Jolla Spa MD, Inc. v. Avidas
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`Pharms., LLC, 2019 WL 5088559 at *3 (S.D. Cal. Oct. 10, 2019) (the 14-day objection window
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`is triggered by the written order, not by an oral ruling made at a prior hearing); Madison v. Health
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`Care Servs. Corp., 2022 WL 17732718, at *1 (W.D. Tex. Dec. 9, 2022) (the 14-day objection
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`window runs from date of service of filing by Magistrate); and (d) ignores that, in all events,
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`Touchstream has in no sense waived its arguments but has actively pursued them. On November
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`18, 2022, just two days after the November 16 hearing, Touchstream filed a motion asking Judge
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`Gilliland to reconsider the foreign damages issue before issuing his written order. ECF No. 107.1
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`Thus, even if Touchstream’s objection were untimely (but again, it was timely, as described
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`above), there would be no occasion to find waiver here. See Fish v. Hennessy, 2012 WL 3643829
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`at *2 (N.D. Ill. Aug. 22, 2012) (“A party’s failure to seek timely review does not strip this Court
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`of its power to review a nondispositive issue decided by a magistrate judge”); Younce v. Barnhart,
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`1 Judge Gilliland has since denied that motion (ECF No. 120). Thus, Touchstream’s objections
`are ripe.
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`2
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`98 F. App’x 305, 306 (5th Cir. 2004) (holding district court was free to review untimely objections
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`to dispositive magistrate judge orders).
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`II.
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`De Novo Review Is Appropriate
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`It is undisputed that the November 29 order ruled as a pure matter of law that foreign
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`damages are not recoverable where, as undisputed here, infringing software methods performed
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`abroad were designed, developed, engineered, and tested in the United States. In other words,
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`even though this order was on a “discovery motion” (Google’s Resp. § II), there is no dispute
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`before this Court, for example, about the relevance and proportionality of the requested
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`information, or about facts in the record that would address such issues. In sum, the dispute raised
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`on this objection is purely legal. Moreover, the motion is dispositive because Google has not
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`represented that Google will not use Touchstream’s lack of the very type of information Google
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`refuses to produce to make dispositive arguments. For both of these reasons, the November 29
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`order must be decided de novo. See Touchstream’s Objections at 4-5, citing Hydranautics v.
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`Filmtec Corp., 2003 WL 23358187, at **1-2 (S.D. Cal. July 23, 2003); Haines v. Liggett Group,
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`Inc., 975 F.2d 81, 91 (3d Cir. 1992); Medical Imagining Centers of America v. Lichtenstein, 917
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`F. Supp. 717, 719 (S.D. Cal. 1996); Lipian v. University of Michigan, 2020 WL 2513082, at *2-4
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`(E.D. Mich. May 15, 2020); Flam v. Flam, 788 F.3d 1043, 1046 (9th Cir. 2015); Ocelot Oil Corp.
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`v. Sparrow Indus., 847 F.2d 1458, 1462 (10th Cir. 1988).
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`Google’s response concedes that a “contrary to law” standard applies. Resp. at 2-3.
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`Moreover, Google does not address Touchstream’s argument that de novo review is appropriate
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`under the “contrary to law” standard or where, as here, only a pure legal ruling is at issue. Id.
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`Google suggests this Court may not reverse the November 29 order simply “because it
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`would have decided the matter differently.” Resp. at 3. However, the only case Google cites for
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`3
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`this proposition applied a clearly erroneous standard to findings of fact. Resp. at 3, citing,
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`Anderson v. Bessemer City, 470 U.S. 564, 573-74 (1985). No findings of fact are at issue here.
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`III.
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`Foreign Damages Are Recoverable Where the Domestic Infringement Is Sufficiently
`Tied to Foreign Activity
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`Touchstream may recover reasonable royalties for, among other things, Google’s domestic
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`acts of infringement under 35 U.S.C. § 271(a) that are the but-for cause of devices located abroad
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`practicing infringing methods. See Objections at 5-8, citing WesternGeco LLC v. ION Geophysical
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`Corp., 138 S. Ct. 2129, 2137-39 (2018); W.H. Wall Fam. Holdings LLLP v. CeloNova Biosciences,
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`Inc., 2020 WL 1644003, at *3 & n.2 (W.D. Tex. Apr. 2, 2020); Plastronics Socket Partners, Ltd.
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`v. Dong Weon Hwang, 2019 WL 4392525, at *5 (E.D. Tex. June 11, 2019); ArcherDX, LLC v.
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`Qiagen Scis., LLC, 2022 WL 4597877, at **12-13 (D. Del. Sept. 30, 2022); Carnegie Mellon Univ.
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`v. Marvell Tech. Grp., Ltd., 807 F.3d 1283, 1306-07, 1310 (Fed. Cir. 2015).
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`Google argues that foreign damages are not recoverable because “infringement of a method
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`claim requires that each of the claimed steps [be] performed within the United States.” Resp. at 5,
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`citing, Meyer Intell. Properties Ltd. v. Bodum, Inc., 690 F.3d 1354, 1371 (Fed. Cir. 2012), and
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`INVT SPE LLC v. Int’l Trade Comm’n, 46 F.4th 1361, 1371 (Fed. Cir. 2022). However, whether
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`“infringement” has occurred is neither disputed nor at issue in these objections. Google does not
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`dispute that its design, development, engineering, and testing in the United States of infringing
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`software methods performed abroad constitute infringement under 35 U.S.C. § 271(a). Thus, at
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`issue is whether damages from this conceded infringement under § 271(a) are recoverable under
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`35 U.S.C § 284. Meyer and INVT (cited in Resp. at 5) did not address this issue. Further, most of
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`Google’s cases do not address this issue. Of the three cases that Google argues are pertinent to
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`this issue: (1) Google continues to wrongly rely on Power Integrations, Inc. v. Fairchild
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`Semiconductor Int’l, Inc., 711 F.3d 1348 (Fed. Cir. 2013), which the District Court in that same
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`4
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`case found was “implicitly overruled” by WesternGeco. Power Integrations, Inc. v. Fairchild
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`Semiconductor Int’l, Inc., 2018 WL 4804685, at *1 (D. Del. Oct. 4, 2018) (“Power Integrations
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`II”). See Objections at 8-9. (2) In Bel Power Solutions v. Monolithic Power Systems, 6-21-CV-
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`00655-ADA, ECF No. 63 (W.D. Tex. 2022), this Court did not address whether foreign damages
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`are recoverable when tied to domestic infringement under 35 U.S.C. § 271(a). See Objections at
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`9. (3) Finally, Brumfield, Tr. for Ascent Tr. v. IB LLC, 586 F. Supp. 3d 827, 840 (N.D. Ill. 2022),
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`newly cited by Google, is distinguishable. That case involved the exclusion of expert testimony
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`on foreign damages information, and whether such exclusion constituted “harmful error”
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`following a jury trial on the merits under Rules 50, 59, and 60. Id. at 833-34, 840. The de novo
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`standard, not a harmful error standard, is at issue here. See Section II above. Moreover, the
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`proponent of the argument in that case abandoned it on reply. Id. at 840 n.5. Further, Brumfield’s
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`statement that Power Integrations, 711 F.3d 1348, remains good law following WesternGeco
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`addressed the issue in only a single paragraph, failed to address the reasoning of WesternGeco,
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`failed to address Power Integrations II, failed to address the other Federal Circuit case of Carnegie
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`Mellon, and was wrongly decided. Alternatively, like in Brumfield, this Court should permit
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`discovery and wait to decide the legal issue after trial. See McGinley v. Luv N’ Care, Ltd., 2018
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`WL 9814589, at *5 (W.D. La. Sept. 10, 2018) (“While [defendant]’s activities may ultimately not
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`give rise to liability under U.S. patent law [§ 271(a)], [plaintiff] is entitled to discover the extent
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`to which [defendant] has engaged in foreign sales activities”).
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`CONCLUSION
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`For the foregoing reasons and those stated in its objections (ECF No. 119), Touchstream
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`respectfully requests that the Court overturn the portion of the Magistrate Judge’s November 29,
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`2022 order denying Touchstream’s motion to compel production of global usage metrics, and order
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`production of the global usage metrics.
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`5
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`Case 6:21-cv-00569-ADA Document 126 Filed 12/27/22 Page 6 of 7
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`Date: December 27, 2022
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`By:
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`Respectfully submitted,
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`TOUCHSTREAM TECHNOLOGIES, INC.
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` /s/ Justin R. Donoho
`One of Its Attorneys
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`Ryan D. Dykal, pro hac vice
`B. Trent Webb, pro hac vice
`Jordan T. Bergsten, pro hac vice
`SHOOK, HARDY & BACON L.L.P.
`2555 Grand Boulevard
`Kansas City, MO 64108
`(816) 474-6550
`Fax: (816) 421-5547
`Email: rdykal@shb.com
`Email: bwebb@shb.com
`Email: jbergsten@shb.com
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`
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`Michael W. Gray (TX Bar No. 24094385)
`Fiona A. Bell (TX Bar No. 24052288)
`Andrew M. Long (TX Bar No. 24123079)
`SHOOK, HARDY & BACON L.L.P.
`600 Travis Street, Suite 3400
`Houston, TX 77002
`(713) 227-2008
`Fax: 713-227-9508
`Email: mgray@shb.com
`Email: fbell@shb.com
`Email: amlong@shb.com
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`Gary M. Miller, pro hac vice
`Justin R. Donoho, pro hac vice
`SHOOK, HARDY & BACON L.L.P.
`111 S. Wacker Drive, Suite 4700
`Chicago, IL 60606
`(312) 704-7700
`Fax: 312-558-1195
`Email: gmiller@shb.com
`Email: jdonoho@shb.com
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`Counsel for Plaintiff Touchstream Technologies, Inc.
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`Case 6:21-cv-00569-ADA Document 126 Filed 12/27/22 Page 7 of 7
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`CERTIFICATE OF SERVICE
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`Pursuant to the Federal Rules of Civil Procedure and the Local Rules for the Western
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`District of Texas, I hereby certify that on the 27th of December, 2022, I served the foregoing to
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`the following counsel of record via the e-mail addresses shown below:
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`Michael E. Jones
`Patrick C. Clutter
`Shaun William Hassett
`Potter Minton PC
`110 N College, Suite 500
`Tyler, TX 75702
`Tel: 903-597-8311
`Email: mikejones@potterminton.com
`Email: patrickclutter@potterminton.com
`Email: shaunhassett@potterminton.com
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`Evan M. McLean, pro hac vice
`Michael C. Hendershot, pro hac vice
`Tharan Gregory Lanier, pro hac vice
`Jones Day
`1755 Embarcadero Road
`Palo Alto, CA 94303
`Tel: (650) 739-3939
`Email: emclean@jonesday.com
`Email: mhendershot@jonesday.com
`Email: tglanier@jonesday.com
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`Edwin O. Garcia, pro hac vice
`Jones Day
`51 Louisiana Avenue, N.W.
`Washington, DC 20001
`Tel: (202) 879-3695
`Email: edwingarcia@jonesday.com
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` /s/ Justin R. Donoho
`Attorney for Plaintiff
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