Free Case Management Statement - District Court of California - California

Case 4:07-cv-06511-CW

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UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA OAKLAND DIVISION LG ELECTRONICS, INC., ) ) Plaintiff/Counterclaim Defendant, ) ) v. ) ) HITACHI, LTD., HITACHI AMERICA, LTD., ) HITACHI DATA SYSTEMS CORPORATION, ) and HITACHI COMPUTER PRODUCTS ) (AMERICA), INC., ) ) Defendants and Counterclaimants. ) ) ) Case No: 4:07 CV 6511 CW

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SECOND JOINT CASE MANAGEMENT STATEMENT AND [PROPOSED] ORDER

SECOND JOINT CASE MANAGEMENT STATEMENT AND [PROPOSED] ORDER CASE NO. 4:07 CV 6511 CW

Case 4:07-cv-06511-CW

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Pursuant to the Court's June 25, 2008 Scheduling Order, Plaintiff LG Electronics Inc. ("LGE") and Defendants Hitachi, Ltd., Hitachi America, Ltd. ("HAL"), Hitachi Data Systems Corporation ("HDS"), and Hitachi Computer Products (America), Inc. ("HCPA") (collectively "Defendants") hereby submit the following Joint Case Management Statement regarding this matter. 1. Jurisdiction and Service

The parties agree that the Court has subject matter jurisdiction over all claims and counterclaims pursuant to 28 U.S.C. §§1331 and 1338. No factual issues relating to service of process or personal jurisdiction remain unresolved. All named parties have been served or have accepted service of process. 2. Facts

This is an action for patent infringement brought by LG Electronics against Defendants Hitachi, Ltd., Hitachi America, Ltd., Hitachi Data Systems Corporation, and Hitachi Computer Products (America), Inc. On June 18, 2007 LGE filed its complaint in the Eastern District of Texas asserting that Defendants infringe, are contributing to the infringement of, or are inducing others to infringe, U.S. Patent Nos. 4,939,641; 5,077,733 and 5,379,379. On October 22, 2007, Defendants filed a motion to change venue. On December 3, 2007, that Court granted that motion and transferred the case to the Northern District of California. On June 27, 2008, LGE filed an amended complaint further asserting that Defendants infringe, are contributing to the infringement of, or are inducing others to infringe, U.S. Patent No. 4,918,645. Defendants' answer to the amended complaint is due August 15, 2008. U.S. Patent Nos. 4,939,641; 5,077,733; 5,379,379; and 4,918,645 are collectively referred to as "the Patents-in-Suit." 3. a. b. c. 4. Legal Issues Whether Defendants directly or indirectly infringe any claim of the Patents-in-Suit. The amount of damages suffered by LGE due to the alleged infringement. Whether the Patents-in-Suit are valid. Motions

No motions are pending, and due to the early stage of this lawsuit, it is difficult to estimate which motions may be anticipated in the future. Defendants, however, anticipate that they may seek -1SECOND JOINT CASE MANAGEMENT STATEMENT AND [PROPOSED] ORDER CASE NO. 4:07 CV 6511 CW

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leave to file an early motion for summary judgment in light of the Supreme Court's decision in Quanta Computer, Inc. v. LG Elecs., Inc., No. 06-937. A further discussion of the potential effects of this decision is included in Section 20 below. 5. Amendment of the Pleadings

Defendants currently intend to file a motion for leave to amend the pleadings to include the affirmative defense of--and declaratory judgment counterclaims for--unenforceability due to inequitable conduct upon completion of their investigation and as fact discovery progresses. 6. Evidence Preservation

The parties have taken steps to preserve evidence relevant to the issues reasonably evident in this action. As set forth in Section 8 of the Joint Case Management Statement filed on April 8, 2008, and ordered by the Court in the Court's April 18, 2008 Amended Minute Order and Case Management Order, which is hereby incorporated by reference (collectively "the April 2008 Case Management Statement and Order"), the parties have reached certain agreements about electronically stored information. 7. Disclosures

The parties made their initial disclosures under Fed. R. Civ. P. 26(a)(1) on April 15, 2008. The parties will supplement their initial disclosures once Defendants have had the opportunity to answer the amended complaint. 8. Discovery

The parties are currently negotiating a Stipulated Protective Order for submission to the Court and have an agreement in principle on nearly all issues. The parties are still discussing provisions and specific language relating to (i) a prosecution bar and (ii) access to source code produced during the course of this litigation. The parties intend to continue negotiations--and hope to have an agreement--with respect to the provisions at issue prior to the August 21, 2008 Case Management Conference. The parties expect to be able to provide a report to the Court regarding the status of the Protective Order at the Conference. Various modifications to the limitations on discovery were agreed to by the parties and ordered by the Court in the April 2008 Case Management Statement and Order. In light of LGE's -2SECOND JOINT CASE MANAGEMENT STATEMENT AND [PROPOSED] ORDER CASE NO. 4:07 CV 6511 CW

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amended complaint, the following further modifications to the limitations on discovery were agreed to by the parties: 70 interrogatories per side. 70 requests per side for admissions for all other purposes. A total of 190 hours per side for depositions, including third party and Rule 30(b)(6) depositions, but excluding expert depositions. For depositions conducted through a translator, twice as many deposition hours will be permitted compared to any corresponding limit were the deposition not translated. Additionally, two hours of a translated deposition will count as one hour of deposition against the total deposition time allotted to each side. No limitation on number of subpoenas to 3rd parties (depositions of third parties to count against the 190 hour deposition cap). The parties further agree that all other provisions of Section 8 of the Joint Case Management Statement filed on April 8, 2008 remain unchanged and continue to govern this litigation. 9. Class Action

Not applicable. 10. Related Cases

Pursuant to this Court's Order, this case has been related to LG Electronics, Inc., v. Q-Lity Computer, et. al., Civ. Action No. C 01-02187 CW ("the Quanta I case"). The parties agree that this case should not be consolidated with the Quanta I case. Also pursuant to this Court's Order, this case has been related to LG Electronics, Inc., v. Quanta Computer, Inc., et al., Civ. Action No. C 08-03407 CW ("the Quanta II case"). Defendants contend that this case should not be consolidated with the Quanta II case. 11. Relief

LGE seeks monetary damages (in an amount sufficient to compensate for the infringement of the Patents-in-Suit and in no event less than a reasonable royalty), that the damages be trebled, interest and costs, attorneys' fees and injunctive relief.

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12.

Settlement and ADR

The case has been referred to private mediation with Judge Infante to take place no later than January 30, 2009. 13. Consent to Magistrate Judge for All Purposes

No longer applicable. 14. Other References

With the exception of the information contained in section 12, above, the parties have no further information regarding ADR process or deadlines at this time. The parties do not believe that this case is suitable for reference to arbitration, a special master or the Judicial Panel on Multidistrict Litigation. 15. Narrowing of Issues

The parties have not yet identified any issues that may be narrowed by agreement or motion. Defendants anticipate, however--as further discussed in Section 20 below--that certain Accused Instrumentalities may be removed from this litigation as a result of the Supreme Court's Quanta decision and may seek leave to file an appropriate motion after further discovery. 16. Expedited Schedule

The parties do not believe that this case may be handled on an expedited basis. 17. Scheduling

The Court has ordered the following schedule:

Rule 6-25-08 Order 6-25-08 Order 6-25-08 Order

Description File Joint (or Separate) Case Management Statement Answer to the First Amended Complaint

Deadline August 14, 2008

August 15, 2008

Case Management Conference 2:00 PM, Oakland, Courtroom 2, 4th Floor

August 21, 2008

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Rule PLR 3-1 PLR 3-2 6-25-08 Order PLR 3-3 PLR 3-4 6-25-08 Order PLR 4-1 6-25-08 Order PLR 4-2 6-25-08 Order PLR 4-3 6-25-08 Order PLR 4-4 6-25-08 Order CM Order CM Order

Description Serve Preliminary Infringement Contentions for the `645 patent and make available documents and accompanying disclosure Serve Preliminary Invalidity Contentions for the `645 patent and make available documents and accompanying disclosure

Deadline August 29, 2008

October 13, 2008

Simultaneously exchange Proposed Terms and Claim Elements for Construction

October 27, 2008

Simultaneously exchange Preliminary Claim Construction and Preliminary Identification of Extrinsic Evidence File/serve Joint Claim Construction and Prehearing Statement

November 17, 2008

December 12, 2008

Completion of Claim Construction Discovery

January 12, 2009

Deadline for private mediation Last day to identify and designate expert witnesses on issues for which a party has the burden of proof and exchange expert reports Last day to serve supplemental disclosures

January 30, 2009 June 1, 2009

June 1, 2009 July 3, 2009

CM Order

Last day to identify and designate rebuttal expert witnesses and exchange rebuttal expert reports Fact discovery closes Expert discovery closes

CM Order 26 27 28 CM Order

July 3, 2009 October 9, 2009

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Rule CM Order, CMC Trans. at 20-21. CM Order, CMC Trans. at 21.

Description Plaintiff's opening brief on claim construction and summary judgment

Deadline October 22, 2009

Defendants' responsive claim construction brief, opposition to plaintiff's motion for summary judgment, and any cross motion for summary judgment Plaintiff's reply on claim construction and summary judgment and opposition to cross motion (if any) for summary judgment Defendants' reply on cross motion (if any) for summary judgment

November 5, 2009

CM Order, CMC Trans. at 21. CM Order, CMC Trans. at 21-22. CM Order

November 19, 2009

December 3, 2009

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Claim construction, summary judgment, and case management hearing. Last day to hear all case-dispositive motions. Serve Final Infringement Contentions

December 17, 2009 at 2:00 PM

30 days after Court's Claim Construction Ruling 50 days after Court's Claim Construction Ruling 50 days after Court's Claim Construction Ruling March 5, 2010

Serve Final Invalidity Contentions

Produce or make available opinion of counsel and related documents relied upon as defense to willful infringement Exchange documents under CLR 16-10(b) (7)-(10) and motions in limine Deadline to meet and confer regarding Pretrial Conference Statement

March 17, 2010

File Joint Pretrial Conference Statement and March 23, 2010 motions in limine Pretrial Conference -6April 6, 2010

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Rule CM Order 18. Trial

Description Trial (10 days)

Deadline April 19-30, 2010

Both parties have requested a jury trial. The Court has specified 10 days for trial. 19. Disclosure of Non-party Interested Entities or Persons

Each party has filed the "Certificate of Interested Entities or Person" as required by Civil Local Rule 3-16, if needed. 20. Other

a. Use of Dr. Douglas Burger as the Court-Appointed Expert The Parties have agreed to use Dr. Douglas Burger as the Court-appointed expert, subject to his consent. The parties will jointly contact Dr. Burger to determine whether he is willing to act as the Court-appointed expert in this matter. If so, the parties will meet and confer, and will submit a proposed order (substantially similar to the Court's Duties and Instructions for Court-Appointed Expert Dr. Douglas Burger in the Quanta I matter) addressing both Dr. Burger's duties as Courtappointed expert and the parties' duties in assisting Dr. Burger. b. Potential Effects of the Supreme Court's Decision in Quanta On June 9, 2008, the Supreme Court held that "Intel's authorized sale to Quanta . . . took its products outside the scope of the patent monopoly, and as a result, LGE can no longer assert its patent rights against Quanta." Quanta Computer, Inc. v. LG Elecs., Inc., No. 06-937, slip. op. at 19. The same LGE patents are at issue in this case. And like a number of the Quanta products, a number of the Hitachi products identified as Accused Instrumentalities by LGE in its Preliminary Infringement Contentions utilize Intel microprocessors and chipsets. Defendants contend that as a result of the Supreme Court's decision, LGE's patent rights visà-vis these products have been exhausted and cannot be asserted. Attached hereto as Exhibit A is a list of the Hitachi Accused Instrumentalities that, based on LGE's Infringement Contentions, incorporate Intel components as to which Defendants contend LGE's patent rights are exhausted.

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LGE contends that because Intel's sales to Quanta may constitute foreign sales, the patent exhaustion issue is yet to be resolved. Accordingly, and because discovery is ongoing, LGE asserts that Defendants' Exhibit A is premature and does not accurately represent those Accused Instrumentalities that incorporate Intel components as to which LGE's patent rights might be exhausted. Additionally, Hitachi products identified as Accused Instrumentalities in this case utilize microprocessors and chipsets from manufacturers other than Intel, and such microprocessors and chipsets may also be licensed under the LGE Patents-in-Suit. LGE has yet to produce to Hitachi any licenses relating to the Patents-in-Suit. In fact, LGE has yet to even produce a copy of the license agreement between LGE and Intel. To the extent that LGE has licensed other third-party suppliers of microprocessors and chipsets identified by LGE as incorporated in the Hitachi Accused Instrumentalities, Defendants contend that such licenses would render LGE's patent rights in additional Accused Instrumentalities exhausted. To the extent that LGE does not drop its infringement contentions with respect to Accused Instrumentalities for which LGE's patent rights are found to be exhausted, Hitachi will likely seek leave to file a motion for partial summary judgment in advance of November 5, 2009 (the date currently set for Defendants' cross-motions for summary judgment in this case) in light of the Supreme Court's decision.

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Respectfully submitted, Dated: August 14, 2008 Dated: August 14, 2008

/s/ Peter H. Kang PETER H. KANG (SBN 158101) [email protected] MARC R. ASCOLESE (SBN 251397) [email protected] SIDLEY AUSTIN LLP 555 California Street, Suite 2000 San Francisco, CA 94104-1715 Telephone: 415-772-1200 Facsimile: 415-772-7400 DAVID T. PRITIKIN (pro hac vice) [email protected] SIDLEY AUSTIN LLP One South Dearborn Chicago, IL 60603 Telephone: 312-853-7000 Facsimile: 312-853-7036 THOMAS N. TARNAY (pro hac vice) [email protected] SIDLEY AUSTIN LLP 717 N. Harwood, Suite 3400 Dallas, TX 75201 Telephone: 214-981-3300 Facsimile: 214-981-3400 Counsel for Plaintiff LG Electronics, Inc.

By: /s/ Perry R. Clark (SB No. 197101) KIRKLAND & ELLIS LLP 555 California Street San Francisco, California 94104 Telephone: (415) 439-1400 Facsimile: (415) 439-1500 William A Streff, Jr., P.C. [email protected] William E. Devitt, P.C. [email protected] Mark L. Varboncouer [email protected] KIRKLAND & ELLIS LLP 200 E. Randolph Drive Chicago, IL 60601 Telephone: (312) 861-2000 Facsimile: (312) 861-2200 Counsel for Defendants Hitachi, Ltd., Hitachi America, Ltd., Hitachi Data Systems Corporation, and Hitachi Computer Products (America), Inc.

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[PROPOSED] CASE MANAGEMENT ORDER

The Second Joint Case Management Statement and [Proposed] Order above is hereby adopted by the Court as the Case Management Order for the case, and the parties are ordered to comply with this Order.

The Honorable Claudia Wilken United States District Judge

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SIGNATURE ATTESTATION

I am the ECF User whose identification and password are being used to file the foregoing SECOND JOINT CASE MANAGEMENT STATEMENT. In compliance with General Order 45.X.B., I hereby attest that the other signatory has concurred in this filing.

SIDLEY AUSTIN LLP By: /s/ Peter H. Kang Peter H. Kang SIDLEY AUSTIN LLP 555 California Street, Suite 2000 San Francisco, CA 94104-1715 Telephone: 415-772-1200 Facsimile: 415-772-7400 Attorneys for Plaintiff LG Electronics, Inc.

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CERTIFICATE OF SERVICE

The undersigned certifies that the SECOND JOINT CASE MANAGEMENT STATEMENT was filed electronically, and pursuant to Civil L.R. 5-5 and 5-6, was served on all interested parties in this action (the above documents were served to registered ECF recipients via electronic service) on August 14, 2008.

SIDLEY AUSTIN LLP By: /s/ Peter H. Kang Peter H. Kang SIDLEY AUSTIN LLP 555 California Street, Suite 2000 San Francisco, CA 94104-1715 Telephone: 415-772-1200 Facsimile: 415-772-7400 Attorneys for Plaintiff LG Electronics, Inc.

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EXHIBIT A

U.S. Patent No. 4,939,641

U.S. Patent No. 5,077,733

U.S. Patent No. 5,379,379

BladeSymphony 1000 Server Modules BladeSymphony 320 Server Modules SMS Arrays Hitachi Freedom Storage Lightning 9900 Series Arrays Hitachi Freedom Storage Thunder 9200 Arrays NAS Device for AMS/WMS Storage Arrays NAS Device for 9900V Storage Arrays NAS Device for USP and NSC55 Storage Arrays Hitachi Content Archive Platform