Case 6:21-cv-00926-ADA Document 394 Filed 09/15/21 Page 1 of 12
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`WACO DIVISION
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`FINTIV, INC.,
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`Plaintiff,
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`v.
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`APPLE INC.,
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`Defendant.
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`Civil Action No. 6:21-cv-00926-ADA
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`APPLE’S OPPOSED EMERGENCY MOTION FOR A CONTINUANCE
`OR, IN THE ALTERNATIVE, A STAY PENDING MANDAMUS
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`Case 6:21-cv-00926-ADA Document 394 Filed 09/15/21 Page 2 of 12
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`Apple respectfully moves to continue the current trial setting by four months due to (1)
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`the unavailability of essential Apple witnesses and (2) surging COVID cases in the region, which
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`has led to a critical lack of hospital capacity. Given the urgency of this motion, Apple requests
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`that the Court order expedited briefing, with Fintiv’s response due by Friday, September 17,
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`2021. Apple waives its right to a reply and respectfully requests a hearing on Monday,
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`September 20, 2021, or as soon as thereafter as the Court is available.
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`I.
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`INTRODUCTION
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`On September 9, 2021, the Court sua sponte transferred this case from Austin to Waco
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`and kept the scheduled trial date of October 4, 2021. The Court’s decision to transfer the case
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`less than a month before trial, while COVID cases are surging in the region, will deprive Apple
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`of essential witnesses and unnecessarily risk the health and safety of everyone involved. On the
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`other hand, a four-month continuance will not prejudice Fintiv, a non-practicing entity, and
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`should allow the case to proceed safely in Austin, without witness conflicts and where Apple has
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`invested significant resources preparing for trial.
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`First, a continuance is necessary because trying this case in Waco in October 2021 may
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`deprive Apple of two of its most critical witnesses—Mohammad Khan, a Bay Area-based prior
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`art inventor of the VivoTech system, and Apple’s technical expert Henry Dreifus. Mr. Dreifus is
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`serving as an expert witness in a case pending in the Eastern District of Texas that is also set for
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`trial on October 4, and Judge Gilstrap recently denied the defendant’s motion for a continuance
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`that would have permitted Mr. Dreifus to testify in both cases, finding that “the trial date for this
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`case has been set for close to a year, while Fintiv’s trial date was rescheduled just six months
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`ago.” Ex. A. Mr. Dreifus cannot attend both trials at once, so Apple risks not being able to call
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`its technical expert at trial if the other trial takes precedence. And although Mr. Khan, a key
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`third party prior art witness, previously agreed to attend trial in Austin if it were held in February
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`Case 6:21-cv-00926-ADA Document 394 Filed 09/15/21 Page 3 of 12
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`or March 2022 (see Ex. B), he more recently told Apple (through his counsel) that he does not
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`want to travel to Waco, both because of the additional travel inconvenience and because of the
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`surge in COVID cases in Waco and elsewhere in the region. Apple faces the real risk of losing
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`both an expert and a prior art fact witness if trial is held in Waco in October 2021.
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`Second, a continuance is necessary to allow the current surge of COVID cases, and the
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`resulting lack of hospital beds, to subside. The Court has previously recognized the difficulty of
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`preparing for a patent trial during the pandemic: “The Court recognizes that preparing for a
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`patent trial can be an arduous task in the best of times and is obviously much more difficult when
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`mobility has been severely restricted by the Government.” Ex. C, Standing Order dated April 9,
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`2020. Here, the difficulties in preparing for trial have been compounded by a short notice
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`transfer to a different city with additional logistical challenges, including locating suitable office
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`space in Waco where social distancing can be maintained. In March 2020, the Court invited the
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`parties to seek to postpone trials where it “may cause a person to travel or act contrary to official
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`guidance or precautions regarding the COVID-19 virus.” Ex. D, Standing Order dated March
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`12, 2020. And the Court recently indicated that it was willing to move this trial to 2022:
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`If both sides on this case told me right now that they want to
`postpone the trial until 2022, for example, that will be fine with me
`as well. Again, it’d have to be by agreement. But if you said that,
`then I can go about my business and be rescheduling things for that
`week now. And so it’s not that big a problem. I’ll just fill it with
`hearings or do something else.
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`Ex. E, 8/23/21 Hr’g Tr. at 6. In response to the Court’s inquiry, Apple proposed either February
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`or March 2022, when Apple and its witnesses are available for trial. Apple respectfully submits
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`that, consistent with Court’s recognition of the difficulties in preparing for trial in a pandemic, a
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`brief continuance is necessary to preserve Apple’s due process rights and to ensure the health
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`and safety of everyone involved.
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`II.
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`AN OCTOBER TRIAL IN WACO LIKELY WILL DEPRIVE APPLE OF
`ESSENTIAL WITNESSES
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`If the Court proceeds with trial in Waco in October, two critical Apple witnesses are
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`likely to be unavailable—a key third-party prior art fact witness, Mohammad Khan, and Apple’s
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`technical expert Henry Dreifus. Not being able to present these key witnesses live at trial would
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`violate Apple’s due process rights. Due process protects the “right to a full and fair opportunity
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`to litigate an issue,” Hardy v. Johns-Manville Sales Corp., 681 F.2d 334, 338 (5th Cir. 1982),
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`and “to present evidence and argument on the contested facts and legal issues framed by the
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`answer to the complaint,” Thompson v. Madison Cty. Bd. of Ed., 476 F.2d 676, 678 (5th Cir.
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`1973). And even if it were possible for these witnesses to testify remotely, this Court has noted
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`that “the ability to compel live trial testimony is crucial for evaluating a witnesses’ testimony.”
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`10Tales, Inc. v. Tik-Tok, Inc., No. 6:20-CV-00810-ADA, 2021 WL 2043978, at *3 (W.D. Tex.
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`May 21, 2021), citing Ayala v. Ruiz, 973 F.2d 411, 419 (5th Cir. 1992) (emphasis added).
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`A.
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`A Key Prior Art Witness, Mohammad Khan, Likely Will Not Attend Trial if
`the Case Proceeds in Waco.
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`Apple intends to call Mohammad Khan, a third-party witness who lives and works in the
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`Bay Area, to testify about the VivoTech prior art system, which he created. Among other things,
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`Mr. Khan will establish that the VivoTech system was in public use in the United States prior to
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`the critical date of the ’125 patent and will explain how the VivoTech system worked at the
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`relevant time. His testimony is critical to Apple’s defense of this case.
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`Apple has identified Mr. Khan as a “will call” witness and estimated his trial testimony at
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`75 minutes, the second longest estimate among Apple’s expected witnesses. Mr. Khan
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`previously stated he was “willing to fly to Austin and testify at the trial if it were to be held in
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`late February or early March of next year.” Ex. B, Khan Letter. After learning of the re-transfer
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`order, Mr. Khan told Apple (through his retained counsel) that he has serious reservations about
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`testifying in Waco given the additional travel inconvenience to Waco and the surging COVID
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`cases in McLennan County and elsewhere in the region.1 Because Mr. Khan is a third party who
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`lives and works in the Bay Area, Apple cannot compel him to testify. However, a continuance
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`will allow the current COVID surge to subside and will allow Mr. Khan to testify in Austin,
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`where he has previously stated he is willing to travel in February or March 2022.
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`B.
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`Apple’s Technical Expert, Mr. Dreifus, Currently Has a Trial Conflict With
`the October 4 Setting.
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`Mr. Dreifus is Apple’s technical expert and is expected to offer critical testimony on,
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`among other things, Apple’s noninfringement and invalidity defenses. Mr. Dreifus is an
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`eminently qualified expert, the author of “Smart Cards: A Guide to Building and Managing
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`Smart Card Applications,” and the inventor of U.S. Patent No. 4,575,621, one of the early
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`patents on smart cards. He will testify (among other things) that the accused Apple products do
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`not infringe the asserted claims of the ’125 patent and that the asserted claims are invalid based
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`on multiple prior art references. Apple has indicated that Mr. Dreifus’ direct examination at trial
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`will last roughly 90 minutes, longer than any other Apple witness.
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`Mr. Dreifus also is scheduled to testify at a trial set for October 4, 2021 in a case pending
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`before Judge Gilstrap in the Eastern District of Texas. In an order dated September 8, 2021,
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`Judge Gilstrap stated he was unwilling to accommodate Mr. Dreifus’ conflict with this trial
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`setting. See Ex. A. Judge Gilstrap stated that if the trial conflict persists, Mr. Dreifus would
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`1 As of September 15, 2021, McLennan County’s COVID case counts are at 134.7 per 100,000
`residents, compared to 45.6 per 100,000 residents in Travis County. Furthermore, 100 percent of
`ICU beds are filled in McLennan County, compared to 95 percent of ICU beds filled in Travis
`County. See Ex. G, McLennan County and Travis County, COVID Act Now Tracker, at 1, 7
`(COVID case counts for McLennan and Travis Counties, respectively); id. at 4, 10 (percentage
`of ICU beds filled in McLennan and Travis Counties, respectively) (updated September 15,
`2021).
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`have to testify by deposition. Id. (“If the witness does not honor his prior commitment, he may
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`appear by deposition.”). Until Apple received Judge Gilstrap’s September 8 order, Apple had
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`understood this trial conflict was avoidable because (1) until recently Judge Gilstrap had up to
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`six trials set for October 4, and (2) even today, he has at least two cases scheduled for trial on
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`that day, including one case with a lower case number than Mr. Dreifus’ case.
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`If the trial conflict is not resolved, Judge Gilstrap’s proposed solution (appearing by
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`deposition) is not workable. Mr. Dreifus will need to attend most, if not all, of the trial in this
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`case to observe opening statements, the testimony of Fintiv’s technical expert Dr. Shamos, and
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`the testimony of the Apple engineers who will explain how the accused products operate.
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`Moreover, Mr. Dreifus’ deposition testimony does not cover all issues on which he will testify at
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`trial. A continuance will preserve Apple’s due process right to fully and fairly present its
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`defenses through Mr. Dreifus live at trial.
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`III.
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`AN OCTOBER TRIAL IN WACO WILL UNNECESSARILY RISK THE
`HEALTH AND SAFETY OF EVERYONE INVOLVED IN THE TRIAL
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`Apple understands the Court has safely conducted trials during the COVID pandemic and
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`does not make this continuance request lightly. However, circumstances have changed
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`dramatically in the past several months. With the emergence of the Delta variant, COVID cases
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`have spiked, with McLennan County seeing record new cases and hospitalizations. Ex. F,
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`“Hospitalizations, Active Cases Set Records as COVID-19 Cases Surge in McLennan County,”
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`Waco Tribune, September 2, 2021. As of today, hospitals in and around Waco are full or nearly
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`full, and ICU beds are 100 percent full. See Ex. G at 1-6.
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`Beyond the obvious risks associated with interstate travel and gathering groups together
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`during a pandemic, the current lack of hospital capacity creates added risk for anyone involved in
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`the upcoming trial who may need medical care, whether COVID-related or not. In contrast,
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`current forecasts indicate that the Delta surge is likely to subside over the next few months,
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`which should also lead to a decrease in hospitalizations. See Center for Disease Control, Covid-
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`19 Forecasts, https://www.cdc.gov/coronavirus/2019-ncov/science/forecasting/forecasts-
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`cases.html. This is consistent with statements from Dr. Anthony Fauci, the nation’s top
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`infectious disease expert, who has indicated the United States could be approaching normalcy
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`once again by Spring 2022. See Ex. H, “US Could Control COVID by Spring 2022 if More
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`People Get Shots,” Reuters, August 24, 2021.
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`Given the current forecast that COVID cases will be on the decline by Spring 2022, this
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`should create a much safer environment for trial in four months. Therefore, based on the
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`significant risks associated with proceeding to trial in Waco in early October when cases are still
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`dangerously high, Apple submits that a brief continuance is warranted for the health and safety
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`of everyone involved.
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`IV.
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`A CONTINUANCE WILL NOT PREJUDICE FINTIV
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`A four-month continuance will not prejudice Fintiv, a non-practicing entity that is
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`seeking money damages in the form of a reasonable royalty and did not plead a request for
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`injunctive relief in its operative complaint.2 See NFC Tech. LLC v. HTC Am., Inc., No. 2:13-cv-
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`1058-WCB, 2015 WL 1069111, at *2-3 (E.D. Tex. Mar. 11, 2015) (finding no prejudice because
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`“monetary relief will be sufficient” for a non-competitor); see also ActiveVideo Networks, Inc. v.
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`Verizon Commc’ns, Inc., 694 F.3d 1312, 1338 (Fed. Cir. 2012) (lack of direct competition is a
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`substantial basis for denying a permanent injunction). Indeed, “the Federal Circuit has held, ‘[a]
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`stay will not diminish the monetary damages to which [the plaintiff] will be entitled if it succeeds
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`2 Fintiv’s Motion for Leave to File a Third Amended Complaint, ECF No. 139, is pending.
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`in its infringement suit—it only delays realization of those damages and delays any potential
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`injunctive remedy.” CyWee Grp. Ltd. v. Samsung Elecs. Co., 2:17-CV-00140-WCB-RSP, 2019
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`WL 11023976, at *4 (E.D. Tex. Feb. 14, 2019) (Bryson, Circuit J.) (quoting VirtualAgility Inc. v.
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`Salesforce.com, Inc., 759 F.3d 1307, 1318 (Fed. Cir. 2014)). Notably, Fintiv has agreed to trial
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`continuances at least three times in this case. Moreover, Fintiv has not identified a compelling
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`reason to re-transfer this case on very short notice so it can be tried during a COVID surge.
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`In contrast, the prejudice to Apple is significant. In addition to the witness availability
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`issues described above, Apple (and presumably Fintiv) have invested significant resources to
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`prepare for trial in Austin, which the Court has noted is a valid consideration. Ex. E, 8/23/21
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`Hr’g Tr. at 7 (“And I know there are looming expenses for hotels and everything else that you
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`have to book.”). Among other things, Apple has already incurred significant expenses reserving
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`hotel rooms and other logistical support in Austin. Given the late notice of the shift to Waco,
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`much of this investment will be forfeited. Trial in Austin also meant that Apple and its counsel
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`could utilize their counsel’s ample office space near the Austin courthouse for pretrial and trial
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`preparations, where social distancing can and will be implemented. Now Apple must scramble
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`on short notice to try to find and secure suitable office space in Waco, which will come at
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`additional cost and may compromise Apple’s ability to socially distance as warranted by the
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`current COVID surge. On the other hand, a short continuance will provide the time necessary to
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`fully prepare for trial, including providing more time for the parties to adjust their trial
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`presentations based on the Court’s rulings on pending summary judgment and Daubert motions,
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`among other things.
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`V.
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`IN THE ALTERNATIVE, THE COURT SHOULD GRANT A STAY PENDING
`RESOLUTION OF APPLE’S FORTHCOMING MANDAMUS PETITION
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`If the Court denies a continuance, Apple alternatively requests a stay of the re-transfer
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`order until the Federal Circuit resolves Apple’s petition for writ of mandamus, which Apple is
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`filing on September 15, 2021. The petition seeks vacatur of the re-transfer order, which Apple
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`respectfully contends is in conflict with In re Intel Corp., 841 F. App’x 192 (Fed. Cir. 2020).
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`Apple’s stay request is governed by a four-factor test, and each factor strongly favors a stay.
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`First, Apple’s petition will make “a strong showing” of likely success on the merits. Nken v.
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`Holder, 556 U.S. 418, 426 (2009). Under Intel, district courts must invoke “appropriate statutory
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`authority,” such as detailed findings under 28 U.S.C. § 1404(a). 841 F. App’x at 194-95. The
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`re-transfer order cites no statutory authority (see Dkt. 386 at 1-2), so mandamus is warranted for
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`the same reasons as in Intel. Second, Apple will be “irreparably injured absent a stay.” Nken,
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`556 U.S. at 426. If the Court conducts a trial in Waco in early October, the damage that Apple’s
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`petition seeks to avoid “will . . . already be done.” In re Lloyd’s Reg. N. Am., Inc., 780 F.3d 283,
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`289-90 (5th Cir. 2015) (citation omitted). Third, a stay will not “substantially injure” Fintiv
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`(Nken, 556 U.S. at 426), because Fintiv does not practice the asserted patent and does not
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`compete with Apple. See In re Morgan Stanley, 417 F. App’x 947, 950 (Fed. Cir. 2011).
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`Fourth, the “public interest” favors a stay (Nken, 556 U.S. at 426), because awaiting the Federal
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`Circuit’s decision would lessen the risks from the current surge in COVID cases.
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`VI.
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`CONCLUSION
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`For the foregoing reasons, Apple respectfully requests a four-month continuance so that
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`trial can be conducted during a time when (1) Apple can present all of its trial witnesses live at
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`trial, and (2) it is likely to be much safer for all involved.
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`Dated: September 15, 2021
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`Respectfully submitted,
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`Case 6:21-cv-00926-ADA Document 394 Filed 09/15/21 Page 10 of 12
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`/s/ John M. Guaragna
`John M. Guaragna
`Texas Bar No. 24043308
`Zachary Loney (Pro Hac Vice)
`Texas Bar No. 24092714
`DLA PIPER LLP (US)
`303 Colorado, Suite 3000
`Austin, TX 78701
`Telephone: (512) 457-7000
`Facsimile: (512) 457-7001
`john.guaragna@us.dlapiper.com
`
`Mark D. Fowler (Pro Hac Vice)
`DLA PIPER LLP (US)
`2000 University Avenue
`East Palo Alto, California 94303-2214
`Telephone: (650) 833-2000
`Facsimile: (650) 833-2001
`Sean C. Cunningham (Pro Hac Vice)
`CA Bar No. 98895
`Erin Gibson (Pro Hac Vice)
`CA Bar No. 229305
`DLA PIPER LLP (US)
`401 B Street, Suite 1700
`San Diego, CA 92101-4297
`Telephone: 619.699.2700
`Fax: 619.699.2701
`sean.cunningham@dlapiper.com
`erin.gibson@dlapiper.com
`Paul Steadman (Pro Hac Vice)
`Stephanie Lim (Pro Hac Vice)
`DLA PIPER LLP (US)
`444 West Lake Street, Ste. 900
`Chicago, IL 60606
`Telephone: 312.368.4000
`J. Stephen Ravel
`State Bar No. 16584975
`KELLY HART & HALLMAN LLP
`303 Colorado, Suite 2000
`Austin, TX 78701
`Telephone: 512.495.6329
`Facsimile: 512.495.6401
`steve.ravel@kellyhart.com
`Harry L. Gillam, Jr.
`State Bar No. 07921800
`GILLAM & SMITH, LLP
`303 S. Washington Ave.
`Marshall, Texas 75670
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`Case 6:21-cv-00926-ADA Document 394 Filed 09/15/21 Page 11 of 12
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`Telephone: 903.934.8450
`Facsimile: 903.934.9257
`gil@gillamsmithlaw.com
`Attorneys for Defendant Apple Inc.
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`Case 6:21-cv-00926-ADA Document 394 Filed 09/15/21 Page 12 of 12
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`CERTIFICATE OF CONFERENCE
`Pursuant to Local Rule 7(g), I certify that on September 15, 2021, counsel for Defendant
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`Apple contacted counsel for Plaintiff regarding the relief sought in the foregoing motion.
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`Plaintiff did not agree to the relief requested therein.
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`/s/ John M. Guaragna
`John M. Guaragna
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that on this 15th day of September 2021, all counsel of record
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`who are deemed to have consented to electronic service are being served with a copy of this
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`document by electronic mail.
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`/s/ John M. Guaragna
`John M. Guaragna
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