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`:14-cv-OO757-REP—DJN Document 54-13 Filed 01/26/15"{Pawfigoffigfia‘ggmfl £2551
`Case 3:14-cv-00757-REP-DJN Document 54-13 Filed 01/26/15 Page 2 of 49 PageID# 2651
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF VIRGINIA
`RICHMOND DIVISION
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`ADVANCED REFRACTORY TECHNOLOGIES,
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`INC., D/B/A CRYSTALLUME,
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`Plaintiff
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`~VS—
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`SP3,
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`INC ,
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`: CIVIL ACTION
`NO. 3:98CV616
`
`Defendant
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`: November 2, 1998
`
`TRANSCRIPT OF HEARING
`BEFORE THE HONORABLE ROBERT E. PAYNE
`UNITED STATES DISTRICT JUDGE
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`APPEARANCES:
`
`MAYS & VALENTINE
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`Richmond,, Virginia
`BY:
`ANTHONY F. TROY, ESQ.
`
`KENYON & KENYON
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`Washington, D.C.
`BY:
`BRIAN M. KOIDE, ESQ.
`EDWARD T. COLBERT, ESQ.
`
`Counsel on behalf of the Plaintiff
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`COUDERT BROTHERS
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`Washington, D.C.; San Francisco, California
`BY:
`MARK LUNN, ESQ.
`DAVID SCHNAPF, ESQ.
`ROBERT D. BECKER, ESQ.
`
`Counsel on behalf of the Defendant
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`/
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`/
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`SANDRA M. BEVERLY, RPR
`OFFICIAL COURT REPORTER
`UNITED STATES DISTRICT COURT
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`THE CLERK: Civil Action Number 3:98CV616, Adyanged
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`Refractor Technolo ies D B A Cr stallume v. SP3
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`Inc.
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`Will counsel please stand,
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`identify themselves for
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`record and the parties they represent.
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`MR. TROY: May it please the court.
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`THE COURT: Mr. Troy.
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`MR. TROY: Your Honor,
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`I’m Anthony Troy with the law
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`firm of Mays & Valentine, and if I may in introducing,
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`I would
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`ask also that a motion pro hac vice be allowed and introduce to
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`the court Mr. Edward T. Colbert, who is a member of the D.C. and
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`Maryland Bars, also a member of the Bar of the Fourth Circuit
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`Court of Appeals as well as the federal circuit, and Mr. Brian
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`Koide, also a member of the D.C. Bar, a member of the federal
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`circuit court,
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`introduce those individuals to the court and ask
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`that they be allowed to proceed pro hac vice. We will be local
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`counsel on the matter for Advanced Refractory.
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`THE COURT: Any objection?
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`It’s a pleasure to grant
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`your motion. You’re admitted pro hac vice on this matter.
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`MR. KOIDE:
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`Thank you, Your Honor.
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`MR. LUNN: Your Honor, my name is Mark Lunn.
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`I’m with
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`the law firm of Coudert Brothers in Washington, D.C.
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`I’m a
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`member of the Virginia State Bar and of this court. At this
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`moment I’d like to present a motion pro hac vice for my
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`colleagues, David Schnapf and Robert Becker, both with Coudert
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`Brothers in San Francisco.
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`THE COURT: Any objection?
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`MR. TROY: No, Your Honor.
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`THE COURT: All right.
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`Thank you.
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`It's a pleasure to
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`grant your motion. Glad to have you with us. Who wants to
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`argue the motion to transfer?
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`MR. SCHNAPF: Your Honor,
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`I’m David Schnapf with
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`Coudert Brothers.
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`I was just introduced. We have brought this
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`motion to transfer not short of the time. There is absolutely
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`no connection between this case and the state of Virginia or the
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`federal district court
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`in Virginia. There are no witnesses in
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`Virginia. There are documents ——
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`THE COURT:
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`Now, wait a minute.
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`I thought you all
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`have offices in Williamsburg.
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`MR. SCHNAPF: We do have a sales office in
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`Williamsburg.
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`Those people we don’t consider them to be
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`witnesses. Any knowledge they have is only as to sales and not
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`likely to be pertinent to this action.
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`The ultimate sales
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`figures and financial documents are maintained in California.
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`We would expect that the administrative person from California
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`would present testimony about sales and the financial numbers.
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`THE COURT: That usually ends up getting stipulated
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`anyway, doesn’t it?
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`MR. SCHNAPF: That’s absolutely correct, Your Honor.
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`THE COURT:
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`So it’s really not going to be an issue
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`between two ——
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`MR. SCHNAPF:
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`I don’t think it would be an issue.
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`I
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`really don’t see that our office —— the fact that our office is
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`in Virginia is just an accident.
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`Is it just happenstance that
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`there is that office there.
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`Those people have no connection
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`whatever to this lawsuit.
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`The people that have connection to this lawsuit on
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`both sides of the suit are all in California, all of SP3’s
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`employees, and it’s a very small company, would absolutely be
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`devastated by having to try this case in Virginia.
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`THE COURT: Have you ever tried a case in Virginia?
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`MR. SCHNAPF:
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`I have not.
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`THE COURT: There ain’t anybody ever been devastated
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`yet, except by the verdict.
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`MR. SCHNAPF: Excuse me, Your Honor?
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`THE COURT: Except by the verdict.
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`MR. SCHNAPF:
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`Just the financial burden is what
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`I was
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`referring to, Your Honor. Having to do all that travel, having
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`to be away from their business to be here.
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`There are basically two principals in the company, Mr.
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`Zimmer and Mr. Herlinger, and for them to be active participants
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`in this litigation, which they would have to be,
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`they would have
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`to be 2,000, 3,000 miles away from their offices trying this
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`matter, and it would be quite a blow on their business.
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`They have already suffered a very substantial blow
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`from a prior piece of litigation that Crystallume brought
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`against SP3 and then essentially walked away from.
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`The
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`settlement left SP3 in business and doing fine, but they had to
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`devote a lot of energy, a lot of effort to that case, and it set
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`them back one or two years in their business plan.
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`THE COURT: Well, what is your experience with respect
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`to whether if you have to devote time over —— or attention to
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`litigation over a short period of time, as compared to the
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`devoting of attention over a long period of time, what
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`impact
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`that has over your principal's business?
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`MR. SCHNAPF: Well,
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`there are two dimensions to that
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`problem.
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`The one dimension is that our principals,
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`the people
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`at SP3, are interested in seeking a quick resolution to this
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`matter.
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`They would like to get this behind them and get it over
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`with.
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`This is not a motion so that they can be dragging this
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`case out.
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`On the other hand, an extremely concentrated effort,
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`extremely concentrated diversion of attention leaves them
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`without the ability to manage their business affairs.
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`So there
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`is some balancing that needs to go along in terms of ——
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`THE COURT:
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`Isn’t that usually what’s done in setting
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`trial dates though?
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`MR. SCHNAPF:
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`I’m sure that it is.
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`THE COURT:
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`Isn’t that what basically is taken into
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`account in establishing a trial date?
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`MR. SCHNAPF:
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`I would hope so, Your Honor.
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`THE COURT: Wouldn’t you rather have it over in four,
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`five, six months,
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`instead of having it over in two years?
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`MR. SCHNAPF:
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`In a way, yes, Your Honor.
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`THE COURT:
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`No disrespect meant to either side.
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`Isn’t
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`really what happens is there is just more legal fees generated;
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`isn’t that what happens?
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`MR. SCHNAPF:
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`I appreciate that, Your Honor.
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`THE COURT:
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`I don't have any objection to that.
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`I
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`think it’s laudable lawyers do what they do, and I paid the
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`tuitions at several colleges by virtue of that. But clients
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`seem to be happier if you resolve it sooner.
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`MR. SCHNAPF: My client is very interested in getting
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`a prompt resolution to this matter, Your Honor, and they are
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`assure you of that.
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`They are interested though in minimizing the expense
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`of having to litigate in a remote forum,
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`the expense of having
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`to bring virtually all the witnesses from both sides of this
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`case to Virginia.
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`THE COURT:
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`They don’t have to pay for both sides’
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`21 witnesses unless they lose though, do they?
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`MR. SCHNAPF: Well,
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`they might have to pay if they
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`lose. They’re certainly going to have to pay in advance before
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`Case r
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`The only reason that this case was brought
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`in Virginia
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`is because of the speed at which this court moves, and we have
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`no objection to the idea of moving quickly. We do think through
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`that there is no other connection with this court.
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`There are absolutely no witnesses in this district.
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`There are no documents in the district. There is no other
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`evidence in this district. There is just really no reason other
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`than the speedy trial, and that’s a valuable thing.
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`I'm not
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`saying it’s not.
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`THE COURT: Well,
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`they said it’s cheaper for them to
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`litigate here than to litigate on the west coast because they
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`don’t have to come but so far to litigate here, and they knew
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`they had jurisdiction over your client here and were not sure
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`they could get jurisdiction in Buffalo.
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`MR. SCHNAPF: Well, Your Honor,
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`their people are all
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`in California.
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`The people of concern here are all in
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`California. This is not a case about licensing where we need to
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`have a licensing executive from Buffalo. This is not a case
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`about advertising or marketing.
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`The people that they list in their papers as being
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`potential witnesses from Buffalo,
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`that’s illusory. When they
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`filed their preliminary injunction motion,
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`they relied on one
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`person to testify as to licensing and the background of this
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`invention. That person is Dr. Herb. He’s in California.
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`That’s the only declaration they filed in connection
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`with their preliminary injunction. That’s the only witness that
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`they have before the court
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`in connection with their preliminary
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`injunction. He's in California, and he’s clearly going to be
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`their most
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`important witness.
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`THE COURT: Well, don't most of these cases just turn
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`on what your experts have to say.
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`MR. SCHNAPF: Well, he’s acting as their expert.
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`THE COURT: Who is your expert and where does your
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`expert live?
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`MR. SCHNAPF: Well, our expert so far is Mr. Zimmer
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`and we haven’t secured a —— we barely had time to ——
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`THE COURT: Mr. Zimmer is one of the inventors?
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`MR. SCHNAPF: No, he’s not an inventor, Your Honor.
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`THE COURT: Who he is?
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`MR. SCHNAPF: He's the head of technology.
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`THE COURT: Of your company?
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`MR. SCHNAPF: Our company,
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`just like Dr. Herb is the
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`head of technology -—
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`THE COURT: Well,
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`they are not going to be your
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`experts.
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`You are going to hire some professionals to testify
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`about the various issues, aren’t you?
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`Isn’t that the way it’s
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`usually done?
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`MR. SCHNAPF:
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`I don’t necessarily agree with that,
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`Your Honor.
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`The primary issue so far that's been advanced is a
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`fact intensive issue about the processes that are employed at
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`9
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`SP3,
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`the processes that are employed at Crystallume, how those
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`processes compare.
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`THE COURT:
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`They say the processes are irrelevant
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`because the issue is the product, which is a fairly easy thing
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`to assess. You give them every one of your products and some
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`expert
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`looks at it and then testifies about it.
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`Isn’t that
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`generally what happens here?
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`MR. SCHNAPF: They’d like the court to believe that,
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`but
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`I don’t think that’s the case.
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`The plaintiff says that the
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`product is unpolished. That requires an understanding of the
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`process behind the product.
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`The claims says that the product
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`fails ——
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`THE COURT:
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`It says it’s unpolished. Doesn’t that
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`require an understanding of what the end product
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`looks like?
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`I
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`mean, it’s either polished or it’s not polished.
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`The English
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`language provides a definition, doesn’t it?
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`MR. SCHNAPF:
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`The patent provides a definition, and it
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`says polished, scratched or otherwise heated.
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`You can’t observe
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`that by just looking at the product.
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`You have to know what
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`process goes into making that product.
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`Likewise,
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`the patent calls for a particular failure
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`mechanism of the product, and that requires an understanding of
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`how the product is used and how it ends up after its use.
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`We
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`believe that there are factual issues very definitely involving
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`witnesses. Every patent case I’ve been involved with,
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`the
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`testimony of the inventors is important. Both of these
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`inventors live in California.
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`THE COURT:
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`I’ve never had an inventor testify except
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`when he was the one who was trying to invalidate the patent of a
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`former employer.
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`MR. SCHNAPF: We will use the inventors to invalidate
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`the patent of this party, Your Honor.
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`So I think it’s typical
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`for a plaintiff not to call an inventor, but
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`I
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`think it’s common
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`for a defendant to call the inventor, and that puts us at a
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`disadvantage because we can’t subpoena these people.
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`THE COURT:
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`I thought one of them worked for you.
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`MR. SCHNAPF: One of them works for us. But, quite
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`honestly, Your Honor, if we have a preliminary injunction
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`imposed on us, he will be laid off, along with most of the rest
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`of the company.
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`THE COURT: Well,
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`that has to do with the merits of
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`the preliminary injunction and balance of hardships. That
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`hasn't got anything to do with the venue issue.
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`MR. SCHNAPF: Well, it has to.do with whether he will
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`be available for trial or not
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`I guess.
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`It's a possibility that
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`he wouldn’t be an employee at that time is my only point.
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`THE COURT: Well, what about the other one,
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`the other
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`inventor,
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`the co~inventor?
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`MR. SCHNAPF:
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`The lead inventor, Mr. Peters,
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`is
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`employed in private industry as I understand it. He’s in a
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`totally different field,
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`lives in California, works in San Jose.
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`THE COURT: Have you asked him whether he can come
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`testify?
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`testify.
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`MR. SCHNAPF:
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`He has no interest in coming to
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`THE COURT:
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`He refuses to?
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`MR. SCHNAPF: What’s that?
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`THE COURT:
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`He refuses to?
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`MR. SCHNAPF:
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`I didn’t put it in those terms to him.
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`I didn’t confront him, say, do you. But he certainly had no ~—
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`expressed no interest in coming here. Maybe he could be
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`induced;
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`I’m not sure. He’s certainly not subject to the
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`subpoena power of this court.
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`Anyway,
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`this is clearly something that’s highly
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`15 discretionary.
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`It’s up to the court how it wants to proceed.
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`16 We recognize that.
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`I also add that in terms of the attorneys’
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`fees issue,
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`it’s not clear to me that it does save attorneys’ fees because
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`19 when you are moving so rapidly, and I have been through similar
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`20 proceedings in the International Trade Commission, which also
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`21 move very, very quickly, you spin a lot of wheels because you
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`23
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`are under such time pressure, you kind of aren’t as efficient as
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`you need to be.
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`THE COURT:
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`So in that instance ~—
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`MR. SCHNAPF:
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`In that instance we ——
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`;
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`THE COURT:
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`If you are efficient, you have to bear the
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`burden of the inefficiency. Your client doesn’t. You certainly
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`would never say that your firm bills for its inefficiency,
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`I’m
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`sure. You would be fair about that.
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`You may sustain a little
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`bit of underrealization in your accounts receivable, but that’s
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`not unusual.
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`MR. SCHNAPF: Well, it depends on whose fault the
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`inefficiency is, Your Honor.
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`10
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`fault.
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`THE COURT: Well, it’s certainly not the court’s
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`It’s not
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`the other side’s fault either.
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`MR. SCHNAPF:
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`Sometimes these things just happen, and
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`ll
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`you make a trip someplace and the witness isn’t there.
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`Do you
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`eat that or not?
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`I don’t know.
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`THE COURT: Well, you should never make a trip to
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`15
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`where a witness is not.
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`If you have a deposition, you subpoena
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`the witness.
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`If the witness isn’t there, you collect out of the
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`witness’ hide.
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`MR. SCHNAPF:
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`I understand, Your Honor.
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`Sometimes
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`collecting ——
`THE COURT:
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`pay the bill.
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`Sometimes the hide is not thick enough to
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`MR. SCHNAPF: You got it.
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`I think you understand the
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`issues.
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`I don’t know that I have much more to add.
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`THE COURT:
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`How do you see the case shaping out
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`in
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`trial? What,
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`in your View,
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`is really going to be the nub of the
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`13
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`case?
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`MR. SCHNAPF:
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`I see two issues, speaking sort of
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`extemporaneous here, without having done a thorough
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`investigation and hopefully ——
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`THE COURT: Well, you just got hired, but you have
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`done enough investigation to file a response to which you signed
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`your name.
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`So I assume you have ~—
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`MR. SCHNAPF: Right. Our response so far is ——
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`THE COURT:
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`You are not going to be married to what
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`you say.
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`I’m just asking for your best judgment at this time.
`MR. SCHNAPF: Okay.
`Thank you, Your Honor.
`The issue
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`of whether or not the substrate is polished is a key issue.
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`The
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`issue of this failure mechanism is a key issue.
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`And right now we are looking very closely at the
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`prosecution history of this patent, and it appears to us that
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`certain declarations that were submitted by the patent owner in
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`order to secure allowance of the patent are inaccurate and
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`misleading and were fraudulently submitted.
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`THE COURT:
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`So you are going to bring a fraud on the
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`patent office defense?
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`MR. SCHNAPF: That’s highly likely at this point. We
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`have not completed our analysis, and it would require some
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`discovery on that.
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`There is also the possibility, very real possibility
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`—— the client has a patent which will issue next week. There
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`14
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`is a real possibility that a counterclaim would be brought
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`alleging infringement by Crystallume of its patent. We are
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`studying that possibility. We haven’t gotten the analysis yet.
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`Those are the issues that I see at the present.
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`It
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`does not seem to be a terribly complicated case.
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`THE COURT:
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`It really is a case that doesn’t sound to
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`5
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`6
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`7 me like it will take more than a couple of days to try
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`8
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`realistically.
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`You have a couple of fact witnesses,
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`three,
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`9 maybe four on each side and an expert on each side.
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`Then you have got the damage question.
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`The damage
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`11 question is going to reduce itself down to what your sales are,
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`isn’t it?
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`Isn’t that what it boils down to? Then you go
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`through the Georgia Pacific factors.
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`You will have an expert on
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`that topic, each one of you.
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`MR. SCHNAPF:
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`I would think a couple days seems a
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`little bit short, but
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`I would think that it’s not going to be
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`long and dragged out.
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`I would guess more like a week, but your
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`judgment is probably better than mine.
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`THE COURT: You know the case better than I do.
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`It’s
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`an unusual case that takes a week to try here.
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`MR. SCHNAPF: Okay.
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`THE COURT: But you may be one of them. Let me hear
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`from the other side.
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`MR. KOIDE: Your Honor,
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`I’m Brian Koide representing
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`the plaintiff, Advanced Refractory Technologies.
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`m
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`6 Division of this court, not
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`the Richmond Division.
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`MR. KOIDE: That’s correct, Your Honor.
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`THE COURT:
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`So why do I have the pleasure of your
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`company, notwithstanding that we are always glad to see you.
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`MR. KOIDE: Your Honor, we originally filed this
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`action in the Alexandria Division.
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`It’s the practice of our
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`firm —— it’s close to where our firm is. And, as you are aware,
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`they have a policy now in the Alexandria Division where they
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`transfer to the other divisions by lottery.
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`So once it was
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`filed in Alexandria ——
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`THE COURT:
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`I don’t think it’s by lottery.
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`MR. KOIDE:
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`I’m sorry. That was my understanding of
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`it.
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`THE COURT:
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`I think that’s how they drew the first
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`judge in order.
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`They better not be doing it by lottery because
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`I’m winning too many times.
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`Well, are you aware of Judge Williams’ and Judge
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`23 Cacheris’ decisions recently sending cases packing because you
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`24 all are trying to run the docket numbers up in our court because
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`25
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`you think it’s faster here?
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`THE COURT: Where do these facilities of SP3, where
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`are they located,
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`in Williamsburg?
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`MR. KOIDE:
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`It’s our understanding that they are in
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`l 5
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`THE COURT: Williamsburg is in the Newport News
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`4 Williamsburg.
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`—fi
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`MR. KOIDE:
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`I’m not aware of those cases, Your Honor.
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`THE COURT:
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`They are very unfriendly decisions to
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`those who seek out the good offices of litigating in this court
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`without having some substantial connection here. What
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`connection that’s substantial do you have, Mr. Koide?
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`MR. KOIDE: Well, Your Honor,
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`I think SP3 has
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`attempted to portray in its papers that they are lacking a
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`presence here. But,
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`in fact, as you noted,
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`there is the
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`Williamsburg sales office.
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`Now,
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`they portray in their papers
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`that ——
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`THE COURT: Why is that office located down there, Mr.
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`Koide; do you know?
`
`MR. KOIDE: Well,
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`in their papers, according to SP3’s
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`papers, it’s a sales office. That sales individual had a desire
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`to work in the Virginia area, and he insisted that he work in
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`that area.
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`THE COURT:
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`So he works the whole east coast;
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`is that
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`basically what it is, or the whole nation or what?
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`MR. KOIDE:
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`It’s unclear.
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`It appears from their
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`papers that he might actually be the distribution center for the
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`whole nation.
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`THE COURT: Distribution center, or I thought it said
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`sales office.
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`MR. KOIDE: Sales office.
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`THE COURT: Excuse me, go ahead.
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`MR. KOIDE: Okay.
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`In essence,
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`there are issues other
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`than infringement that are going to be relevant to this trial
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`that may require discovery.
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`For instance,
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`for the sales office,
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`it would be relevant to know what the likelihood of success is
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`of the products, and this would be relevant to indicia of
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`obviousness for validity.
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`Also,
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`they indicate in their papers that the sales
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`office has samples. These samples may be relevant to see what
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`is actually being sold through that sales office.
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`It's, of
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`course, also relevant to damages. Damages, if it’s a sales
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`office,
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`they are likely to have damages information that may be
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`relevant to damages issues.
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`THE COURT: Well, how many witnesses do you have and
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`where are they?
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`MR. KOIDE: At this time we have witnesses both in
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`Buffalo and in California.
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`THE COURT:
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`How many in Buffalo?
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`How many in
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`California?
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`MR. KOIDE:
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`I believe we have identified three, at
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`least three in Buffalo that relate to the business side. We
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`also may have witnesses relating to the NCMS ——
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`THE COURT: Excuse me,
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`just a minute.
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`(Discussion off the record.)
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`THE COURT: All right.
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`MR. KOIDE: We also may have witnesses ——
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`THE COURT: Three in Buffalo.
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`MR. KOIDE: At least three, Your Honor.
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`THE COURT: Well, we need to get fairly specific.
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`MR. KOIDE: Okay. We have Michael J. Drenon,
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`the
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`chief financial officer at ART, A—R—T; Keith Blakely, who is the
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`president; Christopher Kayland, who is the director of sales and
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`marketing; Donald Bray, business development; and Roger S.
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`Storm, who is a vice president of Technology.
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`THE COURT:
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`They are all in Buffalo?
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`MR. KOIDE: Yes, Your Honor. We rely in the
`
`preliminary injunction papers on John Herb, who is in
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`California.
`
`THE COURT: Well, what do you do in California and
`
`what do you do in Buffalo?
`
`MR. KOIDE:
`
`It is my understanding that California
`
`does the —— what
`
`I would consider the research end of the
`
`development and ART handles the business end of where the —-
`
`the
`
`business planning. Also,
`
`they do research and development,
`
`some
`
`research and development as well.
`
`THE COURT: Are you saying the business planning?
`
`What’s that got to do with the litigation we are dealing with?
`
`MR. KOIDE: Well,
`
`I think it’s relevant to show what,
`
`for instance, on the preliminary injunction, what irreparable
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`19
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`harm is to Crystallume and ART.
`
`They are the plaintiff, and
`
`they are likely to show both for irreparable harm and later on
`
`for damages purposes discovery.
`
`I'd also like to point out that the burden that SP3
`
`claims in its papers is likely to be limited predominantly to
`
`trial.
`
`The discovery itself would likely —— or could possibly
`
`be taken in California.
`
`So the representations they make where
`
`those employees will be put out of their way is not completely
`
`accurate for the whole litigation period.
`
`It will likely be
`
`limited to trial.
`
`THE COURT:
`
`How big is your company?
`
`MR. KOIDE:
`
`I don’t have actual figures on ART, Your
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`Honor.
`
`I know it’s bigger than SP3.
`
`I’ve been dealing more
`
`with the division of Crystallume for my purposes.
`
`THE COURT:
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`How big is the Crystallume division?
`
`MR. KOIDE:
`
`I don’t know the employees.
`
`It’s fairly
`
`small.
`
`I don’t want to make an inaccurate representation.
`
`I
`
`can make a guess, but it is not a large company, a large
`
`division of ART.
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`THE COURT:
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`How do you see the damage issues being
`
`MR. KOIDE: Well, we would put on a case of lost
`
`in which case we would need to know what our side, ART,
`
`proved?
`
`profits,
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`has lost. We would need discovery or we would —— an issue in
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`discovery would be what we have lost in profits.
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`Case 3:14-cv-00757-REP-DJN Document 54-13 Filed 01/26/15 Page 21 of 49 PageID# 2670
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`20
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`There also might potentially be a reasonable royalty
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`case,
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`in which a reasonable royalty could be negotiated. But we
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`would argue that lost profits should be the measure of damages
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`in this case.
`
`THE COURT: Where are the records by which your lost
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`profits or the appropriate royalty figure would be —— around
`
`which they would turn, where are the documents?
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`MR. KOIDE: My understanding, Your Honor,
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`is those
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`sales figures would be in Buffalo, New York at ART.
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`THE COURT: Well, your calculation of your average
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`profit margin over time,
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`is that done there,
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`too?
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`MR. KOIDE:
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`I’m not sure, Your Honor. My
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`understanding is that Crystallume really only handles the
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`technical side. When it goes to the business side,
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`including
`
`the figures you are asking about, are in Buffalo.
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`THE COURT:
`
`The products that Crystallume sells that
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`use this patent,
`
`they are all made in California, are they?
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`MR. KOIDE: That’s my understanding, Your Honor.
`
`THE COURT: And the products that SP3 sells that
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`infringe this patent allegedly, are they all made in
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`California?
`
`MR. KOIDE: Yes, Your Honor. That’s our
`
`understanding. There may be more that we don’t know about.
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`THE COURT: More what?
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`MR. KOIDE;
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`To our knowledge,
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`the only manufacturer is
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`21
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`in California.
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`THE COURT:
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`How many witnesses do you think you will
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`take to prove your case?
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`MR. KOIDE:
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`On the trial on the merits or the
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`preliminary injunction?
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`THE COURT:
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`The trial.
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`MR. KOIDE: We haven’t fully evaluated.
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`By the lines
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`that you asked opposing counsel,
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`there would be really very
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`few. Our View is that it's limited to one limitation, which is
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`unpolished. We could select an expert witness from this area.
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`I think it would be just as easy for SP3 to select a local
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`expert as well.
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`So the burden on an expert for trial would be
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`minor.
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`THE COURT: Well, as a practical matter, if you are
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`going to try a case before a jury, both of you try to select a
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`knowledgeable expert from the area, if you can. But
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`in some
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`instances,
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`there are technologies that local people don’t have
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`expertise in, so you have to import
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`them. Where is your
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`expert?
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`MR. KOIDE: We have not selected an independent
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`expert, Your Honor. As you are aware, our preliminary
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`injunction papers rely on the declaration of John Herb, who is
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`an employee of ART.
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`THE COURT:
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`So how many witnesses do you think you are
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`going to put on to prove your case?
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`Case 3:14-cv-00757-REP-DJN Document 54-13 Filed 01/26/15 Page 23 of 49 PageID# 2672
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`MR. KOIDE: Your Honor, we haven’t made that ——
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`THE COURT:
`
`You are going to put an expert on to show
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`infringement. You may put an expert on to show damages.
`
`MR. KOIDE: That's right.
`
`THE COURT:
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`Then what else are you going to put on?
`
`MR. KOIDE:
`
`It somewhat depends on what defenses SP3
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`raises in defense to our charge.
`
`THE COURT: Well, assume that they don’t attack the
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`validity of the patent, except to contend that there was fraud,
`
`which really is almost an estoppel type of defense.
`
`MR. KOIDE: Right.
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`THE COURT: Assume that they then say, it’s not
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`infring
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