Free Transcript - District Court of Delaware - Delaware


File Size: 101.6 kB
Pages: 27
Date: December 31, 1969
File Format: PDF
State: Delaware
Category: District Court of Delaware
Author: unknown
Word Count: 6,160 Words, 34,950 Characters
Page Size: Letter (8 1/2" x 11")
URL

https://www.findforms.com/pdf_files/ded/36016/307.pdf

Download Transcript - District Court of Delaware ( 101.6 kB)


Preview Transcript - District Court of Delaware
Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 1 of 27 1

1 2 3 4 5 6 7 8 9 v

IN THE UNITED STATES DISTRICT COURT IN AND FOR THE DISTRICT OF DELAWARE - - MCKESSON AUTOMATION, INC., a Pennsylvania Corporation, Plaintiff, : : : : : : : : : : : - - Wilmington, Delaware Friday, May 23, 2008 at 11:00 a.m. TELEPHONE CONFERENCE - - BEFORE: HONORABLE LEONARD P. STARK, U.S. MAGISTRATE JUDGE - - APPEARANCES: CIVIL ACTION NO.

SWISSLOG HOLDING AG, SWISSLOG MANAGEMENT AG, TRANSLOGIC CORPORATION, and SWISSLOG NORTH AMERICA, Defendants.

06-28 (SLR-LPS)

10 11 12 13 14 15 16 17 18 and 19 20 21 22 23 24 25

BLANK ROME, LLP BY: CHRISTINE S. AZAR, ESQ.

SUTHERLAND ASBILL & BRENNAN, LLP BY: BLAIR M. JACOBS, ESQ., and CHRISTINA A. ONDRICK, ESQ. (Washington, District of Columbia) Counsel for Plaintiff

Brian P. Gaffigan Registered Merit Reporter

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 2 of 27 2

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

APPEARANCES:

(Continued)

MORRIS NICHOLS ARSHT & TUNNELL, LLP BY: JULIA HEANEY, ESQ. and DICKSTEIN SHAPIRO MORIN & OSHINSKY, LLP BY: ALFRED R. FABRICANT, ESQ. (New York, New York) Counsel for Defendants

- oOo P R O C E E D I N G S (REPORTER'S NOTE: The following telephone

conference was held in chambers, beginning at 11:00 a.m.) THE COURT: Hello? Anybody there? MR. FABRICANT: MS HEANEY: THE COURT: Yes. Good morning. Are counsel there?

Good morning. This is Judge Stark. Let me know

who is on the line, please. MS. HEANEY: Your Honor, this is Julie Heaney

for defendants; and Fred Fabricant is also on.

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 3 of 27 3

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

THE COURT: MR. JACOBS:

Okay. Your Honor, on behalf of McKesson

Blair Jacobs and Christina Ondrick is also on the line. THE COURT: Okay. Good morning to you, all.

(The attorneys respond, "good morning.") THE COURT: So I have received the letters that

I had ordered following our hearing the other day. A VOICE: MS. AZAR: from Blank Rome. THE COURT: MS. AZAR: THE COURT: expecting anybody else? MR. JACOBS: THE COURT: I think that is all, Your Honor. Okay. All right. So I was just Okay. This is Judge Stark. Joining conference, Christine Azar. Good morning. This is Christine Azar

Good morning, Your Honor. Thanks for joining us. Are we

saying I've seen the letters; and in terms of how this dispute will be resolved, I mean it does fall kind of in between the parts of the case that are with Judge Robinson and the parts that are with me since it relates to claim construction which is with Judge Robinson, it relates to scheduling which is with Judge Robinson, but it may have an impact on discovery which is in front of me. So I'm still

not entirely clear on how and when you are going to get a final decision on this dispute, but I want to make sure that

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 4 of 27 4

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

I understand the dispute in full and make sure that there is no chance of working out an accommodation. I take it -- well, let me ask you, Mr. Jacobs, when we left the other day, you at least seemed somewhat hopeful there might be some further efforts to try to resolve this dispute. I take it there were efforts but they

failed; is that correct? MR. JACOBS: That is correct, Your Honor. We

have essentially offered to amend the order, scheduling order with regard to these specific allegations and to allow the defendants any time they need to respond, amend expert reports and things of that nature and also, if necessary, to amend deposition dates with regard to these specific allegations. And we received a response back indicating

that, you know, because of the complexity I suppose of the issue, they did not believe that a scheduling amendment would work here. THE COURT: Okay. Your Honor, this is

MR. FABRICANT: Mr. Fabricant. THE COURT:

Yes. I guess the real issue here is

MR. FABRICANT:

that from the day the lawsuit started two or more years ago, the brochures were available on the website which indicated this issue which disclosed that, you know, how

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 5 of 27 5

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

these products worked and gave the information that if they believe this was an infringing product to one of their claims, they could have asserted it. There were numerous

depositions, including the two that we've cited in our letter which support that. There are lots of documents

which were produced to the plaintiff at a very early stage which provides this information. And the additional claims

now being asserted, you know, do add a significant amount of work which would need to be done. If this had happened at

an earlier stage of the litigation, I'm sure the Court would have a much easier time allowing that to be added. But at

this stage, in light of the fact that really from the day the case was filed, all this information was available and then was subsequently provided. In fact, during the Youtz deposition, he was the product manager and not only did he provide the testimony that was included in the letter that we submitted the other day, in their letter response, they basically were saying, well, yes, he gave that testimony but it really didn't address the issue of whether it was offered for sale or was a product available at that time. Mr. Youtz further testified specifically in his deposition conducted in May of '08, at Page 246. specifically asked: "Question: Have you encountered a hospital that He was

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 6 of 27 6

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

has told you that it would be interested in the PillPick system but not the PickRing? And he answered: "Answer: Yes. And in that instance, is that when Offered it?

"Question: you offered the FillBox? "Answer:

Yes."

So it's not just this recent sale to Heartland. It was the subject of clear testimony dating back as early as May by the product manager himself. THE COURT: there. Mr. Jacobs, let's have you address first the point of you say that I think you initially had some of these terms as your claim construction terms or terms that might be in dispute but then you withdrew them in good faith and now you want to add them back. Help me understand that Okay. Hold on. Let me stop you

sort of history and why the initial withdrawal was in good faith and why now you should be allowed to do it. MR. JACOBS: That is fine, Your Honor. And Ms.

Ondrick can jump in if I miss something. Essentially, Your Honor, I understand what Mr. Fabricant is saying with regard to the product manager. And we do recall that testimony. There was a corporate

witness who testified on behalf of Translogic/Swisslog who

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 7 of 27 7

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

contradicted that testimony.

And after the corporate and

30(b)(6) testimony, we decided that we did not have, based on that corporate testimony, any type of good faith basis for keeping these claims in this case any further. After that, subsequent to that, we received the expert report of Mr. Stec. And he provided additional

information kind of corroborating what Mr. Youtz had said but contradictory to what the 30(b)(6) witness had said. And at that point in time we said okay, you know, now, out of an abundance of caution, let's put these back in again because now it appears they have given the information to this expert for him to, with a good faith basis, conclude that these features are there. And, Your Honor, we're

dealing essentially with a modification, a FillBox modification, a conveyer belt essentially at the back end of the product. We have asked the defendants on a couple of different occasions for the factual basis of their claim this would take significant amounts of expert time because, you know, we've all done this many times. both of the plaintiff and defendant side. We've been on And from our

perspective, we're looking at a fairly quick modification on the invalidity side. work. this. This is not going to take a lot of

We thought a couple of weeks easily would address We just don't see it as being a significant amount

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 8 of 27 8

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

of time, as they're contending.

We asked a couple times

why it would take a significant amount of time and have not received a response to that. THE COURT: We'll get a response in a second,

but first respond to articulate what the prejudice to you is if we don't allow you to add these claims at this point in the case. MR. JACOBS: The prejudice is that we were

relying on the corporate testimony, the 30(b)(6) testimony of their witness when we withdrew. As soon as we received

knowledge that these features were in fact present, we initiated contact with opposing counsel, there was not a significant delay, and asked if we could bring these claims back in again. They're dependent claims that already The

relate to independent claims that are in the case.

prejudice is that we will have no way that we'll be able to assert these claims that we should rightly be able to assert. THE COURT: Okay. Your Honor, if I can address

MR. FABRICANT:

the 30(b)(6) issue for a moment? THE COURT: Yes, address that, and then

articulate for me with specificity your contention that this will throw off every date and, you know, basically "the sky is falling" if we add these claims into the case.

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 9 of 27 9

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Honor.

MR. FABRICANT:

Yes, Your Honor.

On the

30(b)(6) issue, there is a very clear answer, and that is as follows: There are two defendants in the case, Your There is Swisslog Italia, the manufacturer in Italy,

and there is Translogic, the company in the United States that offers the product for sale. The Swisslog Italia

company has nothing to do with offering the products for sale in the United States, only with selling the product to the American company. The witness which Mr. Jacobs talks about here, Mr. Davolio, was a 30(b)(6) witness only for Swisslog Italia. He has no relationship with Translogic, the He had nothing to do with offering

American company.

products for sale; and he was not designated under 30(b)(6) on the subject of what products are offered for sale in the United States. Rather, he was offered on the subject of how

the system is set up, and how the products work together, not even addressing the issue of what product are offered for sale in the United States -- a subject which was covered not only by the Translogic witnesses, Mr. Youtz and Mr. Hinnen, the sales manager and the product manager, but also by every brochure, by the website, by all of the documents, all the of the things within McKesson's possession literally from the day the case started.

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 10 of 27 10

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

THE COURT:

Let me stop you at that point.

Mr. Jacobs, what was your response that it was a 30(b)(6) for the wrong entity? MR. FABRICANT: Absolutely, Your Honor.

30(b)(6), he was the lead engineer for the entity that made the product. sale. Mr. Fabricant talked about offered for

Remember that the patent act covers as acts of And certainly if

infringement anything made, used or sold.

this product were used in the United States and it did not have the features that were described by this lead engineer, at that point in time, and he is saying it doesn't have these certain features, we have to conclude, based on that testimony, that we cannot maintain those claims in the case because it's not being made, used or sold in the United States. Then we get testimony from somebody else in an expert report subsequent to that indicating, oh, in fact, it is being made, used or sold in the United States. we're not just looking at offered for sale. So

We were looking

at what this individual said, what features were part of the product when it was actually made in Italy and, our understanding is, shipped to the United States for eventual sale. THE COURT: either of you have them. Let me get some dates here, if The witnesses that we're

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 11 of 27 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

discussing are Davolio and Youtz; is that correct? MR. FABRICANT: MR. JACOBS: And Hinnen.

Yes, and Mr. Hinnen. And I think I should point out,

MR. FABRICANT:

Your Honor, what we're referring to here as the new evidence which gave this change to the McKesson company was two lines in the Stec report -- which is the damages expert, not the technical expert -- the damages expert who, in reference in the historical portion of his report, referenced a brochure on the website of Translogic. THE COURT: Okay. Here is what I want to know.

Davolio, that was the 30(b)(6) witness for Swisslog Italia; is that correct? MR. FABRICANT: THE COURT: Yes, Your Honor.

That's the one, Mr. Jacobs, you are

saying you relied on in withdrawing your claims; is that correct? MR. JACOBS: THE COURT: That is correct, Your Honor. Do we know what the date of Mr. or

Ms. Davolio's testimony is? MS. ONDRICK: Your Honor. of 2007. THE COURT: Okay. Was that Ms. Ondrick? I can give you that information,

Mr. Davolio's deposition was May 23rd and 24th

MS. ONDRICK:

Yes, this is Ms. Ondrick.

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 12 of 27 12

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 9th of 2006. Davolio. May 3rd. and is he?

THE COURT:

Okay.

Thank you.

And now Youtz.

Again, what kind of witness was

MR. FABRICANT:

Yes.

Mr. Youtz was the product

manager for the very product in question from Translogic in the United States; and we believe his deposition was taken actually within a short number of weeks after Davolio. was in June. We believe it was in June of 2007. MS. ONDRICK: Actually, that was -Or May. I'm sorry. It

MR. FABRICANT: MS. ONDRICK:

That's correct, Your Honor.

MR. FABRICANT: Right. MS. ONDRICK:

May 3rd.

So it was before

It was before Davolio.

And it

was an individual witness's testimony, it wasn't 30(b)(6) testimony. THE COURT: Right. And who is Hinnen?

MR. FABRICANT:

Hinnen was the sales manager for

the product in the United States. MR. JACOBS: Davolio deposition. And that was well before the

Do we have that date, Christina? Yes. That was November 8th and

MS. ONDRICK:

MR. FABRICANT:

So, Your Honor, it's clear then

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 13 of 27 13

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

that two of the depositions that we're talking about of the Translogic entity that actually makes, that uses and sells this product in the U.S. have made clear by those people who were the most familiar with the product that it was being offered for sale in the U.S., and that if they had a claim of infringement they could assert it. MR. JACOBS: And, Your Honor, you see the The guy who makes it said it

contradiction that we have.

didn't have these features, and he said it after. THE COURT: But let me ask you -Your Honor, just so it's very

MS. ONDRICK:

clear, it's that product -- a product of the type we are now alleging infringes -- the way Mr. Davolio's deposition testimony reads out is that that product doesn't exist. So

I don't understand how they could offer a product that he said doesn't exist. MR. FABRICANT: thing I would like to add. Your Honor, there is one other Mr. Davolio also at his

deposition testified that he was -- that the pillbox product was designed and developed without his participation. That

it happened after he had become only a consultant to the company and that he only had a high level of understanding of what its functionality was. THE COURT: And Mr. Jacobs or Ms. Ondrick,

the claim terms that you want to add in, were they all

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 14 of 27 14

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

originally at issue?

And, if so, on what date did you

withdraw them from being at issue? MS. ONDRICK: Christina Ondrick. Yes, Your Honor. This is

They were originally at issue, and we

asserted them when -MR. JACOBS: Christina? MS. ONDRICK: We withdrew them on January 31st, When did we withdraw them,

2008, at the close of fact discovery. THE COURT: And why did it take from the

May 2007 deposition of Davolio until January of '08 to withdraw them? MS. ONDRICK: Your Honor, we were assessing all

of our contentions at that time, and we wanted to supplement what we had to make sure it was accurate and accurately reflected what was there. And we did that at the close of

discovery so we weren't proceeding in the case with, you know, assertions that we shouldn't be raising. THE COURT: And was there any back and forth

or, you know, is there any record of any communications between the parties about the situation that the plaintiffs evidently found yourselves in, which was arguably there was a basis for keeping these claims at issue based on the Youtz and Hinnen testimony but that seemed contradicted by the Davolio testimony. And so I guess my question is did you

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 15 of 27 15

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

just unilaterally decide to rely on Davolio despite the contradiction or inconsistency or was there any discussion or back and forth about the bind that you may have been in? MS. ONDRICK: back and forth with them. No, Your Honor. We did not go

We did not see this as

contradictory or a bind at the time the information we had looked at led us to believe that it was not being offered for sale in the particular configuration that we now understand to be offered for sale. THE COURT: Help me understand how you reached

that conclusion if, just three weeks earlier, you had the Youtz testimony, the product manager for the company in the United States distributing the product, which I'm being told, at least, was evidence that the product was being distributed. MS. ONDRICK: Well, the product wasn't being

distributed and it had never been sold in the United States. It was our understanding that the only configuration that they could have offered was the configuration where it was inline in the system after the PickRing, not in a situation where it existed without the PickRing. And it seemed to

us -- and this is sort of I think speculation -- but at that point, this product is so close in this alternative configuration for infringement, it has become clear that that, you know, is really why I think they're making this

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 16 of 27 16

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

argument for refusing to provide us with any kind of deadline to extend discovery. THE COURT: Mr. Fabricant. MR. FABRICANT: THE COURT: Yes. Well, let me turn to that.

I had cut you off earlier, but

explain to me or persuade me that, whether it's fair or not on its own face, to let them have these terms at this point, I want to focus now on what impact would it have on the schedule if I did allow them to add it back. that for me. So articulate

Specifically, which dates would have to be

changed, and how much, and why? MR. FABRICANT: Well, Your Honor, what it

involves from a work standpoint is having -- first of all, doing additional searches of the prior art to try to determine whether there is prior art that reads on the additional claims which are now being asserted with respect to this configuration. It was withdrawn and was not

something which we focused on as a result of having been withdrawn. We would need to obviously to consult with the expert witness who was testifying on the subject of invalidity so that that witness could evaluate the prior art, the relevant art and amend and modify their expert report on the subject of these additional claims.

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 17 of 27 17

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

We would also need to evaluate the infringement aspect of the non-infringement of the additional claims. We

would have to work with the expert, obviously, to have the expert consider and evaluate the non-infringement position of the additional claims. And then, of course, once we made those modifications and amendments, the McKesson expert no doubt would have to respond to the additional changes and modifications made by our experts. THE COURT: discovery; right? But it would only affect expert

There wouldn't be reopening fact

discovery since these claims were at issue until the last day of fact discovery; correct? MR. FABRICANT: That's correct. We would have,

certainly, no intention of reopening fact discovery on that point. MR. JACOBS: THE COURT: Nor would McKesson. Right. Mr. Fabricant, why isn't an

extra three-weeks-or-so about the magnitude of time that might need to be added to the expert process? MR. FABRICANT: Well, if there had to be

additional time, I think, you know, perhaps 30 days would be appropriate. I mean, first of all, searching for prior Our expert on this subject

art, meeting with the expert. is in California.

You know, he is a professor in college.

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 18 of 27 18

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

We have to get time when he is available.

So I mean it's

not always easy to work within a short period of time. I think also the prejudice should be viewed in light of the fact -- the comment that was made about this product being offered for sale. The testimony is without

question clear that the product was offered for sale, was in our brochures, was on our website. to that. Mr. Youtz testified

This was obviously a very considered analysis that

McKesson did from the spring of 2007 until January '08, after which they made an intelligent decision based on all the deposition transcripts, all the documents, that there was no basis for asserting these claims. Now we're being put in the position -- and I think this is part of the prejudice -- even if we're allowed an additional period of time, we're now being put in the position as a result of their about-face, after having months and months to consider this, of having to address these additional -- you know, this is five additional claims in a patent lawsuit, which will make the case more complicated, will make the trial longer, will make the cost greater, will take more of the Court's time at trial, will make Markman more complex, will make the Markman briefs longer. I mean it adds to the complexity and the cost and

burden of the case. THE COURT: Mr. Jacobs or Ms. --

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 19 of 27 19

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 to that.

MR. FABRICANT:

And, Your Honor, I'm sorry.

One

other thing, which I think is perhaps the most important from our standpoint. I think it's unfair to allow a

plaintiff to wait until it has our expert report on invalidity, have it for a month, for a solid month, to have an opportunity to evaluate our expert report on invalidity and to see the strengths of our invalidity arguments on the asserted claims and then, one month after having the benefit of that report and analysis and having the opportunity to meet with their own expert, to discuss it, to say: something? here. You know

We think we'd better add some additional claims

Perhaps we have some problems. To now go back and redesign the case around our

expert report on invalidity, I don't think that is what the rules were meant to provide, nor the scheduling order meant to provide; to allow one party an unfair advantage to view the other side's expert report on invalidity and then being given an additional opportunity to change its entire case. And I think perhaps that is our strongest argument. THE COURT: Thank you. And I did want to turn

Mr. Jacobs or Ms. Ondrick, it seems to me if fact

discovery was closed on January 31st, 2008, whatever you learned in the expert report, it's not in the nature of factual evidence, it's an expert opinion. So help me

understand not just the arguable unfairness as Mr. Fabricant

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 20 of 27 20

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

points out but how can you in fact learn something factual about this case from an expert that you shouldn't have been able to figure out on your own based on the factual record that was established during fact discovery. MR. JACOBS: I'll handle that, Christina.

Your Honor, what happened was Mr. Stec met with individuals relating to specific configurations that were being offered by Translogic. So he was provided, and he

represents in his report that he was provided, certain factual information that allowed him to draw his conclusion. This is one of those conclusions that he indicates was based on factual information that was provided to him. This information regarding this particular configuration is also contradictory to the last piece of information that we had on the record from Mr. Davolio relating to this. So at that point in time, we needed to reevaluate the factual nature of whether this configuration was being offered. And if it is being offered, Your Honor,

then we have a good faith basis for bringing these claims into the case. And so, you know, oftentimes experts would speak to people and are provided information, see documents perhaps that haven't even been provided during the course of discovery. They then testify based on that factual

information, and that factual information is something that

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 21 of 27 21

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

you can then examine and have your experts look further at. This has nothing to do with their invalidity contentions. We had our expert look at this factual statement in light of the fact that it changed our knowledge of the configuration that was being offered based on the testimony of Mr. Davolio, the corporate testimony. He looked at it

and said you can assert infringement of these claims based on this factual information. And with regard to the invalidity contentions, remember, Your Honor, these claims were in the case and the defendants had already filed invalidity contentions in the case on a couple of different occasions and so certainly they have already done a prior art since they've already looked at this. This is already out there. We didn't

withdraw this until the end of fact discovery. THE COURT: Right. Well, the last thing I need

to hear from both sides is tell me, there was some allusion to kind of the urgency of this issue. I want to understand That is,

what dates are we pressing up against right now? say, in the next two weeks to 30 days? MR. FABRICANT:

Mr. Fabricant. Well, the

Yes, Your Honor.

first dates that come up are the dates for our rebuttal report to the expert report submitted by McKesson on infringement, so we have to address non-infringement, and that I believe is May 28th?

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 22 of 27 22

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Your Honor.

MR. JACOBS:

Yes. But that right now is May 28th,

MR. FABRICANT:

And then, of course, we would have to modify the invalidity report. And those dates are the dates by which

the dates for the Markman briefs and summary judgment briefs have been set. So that when the dates were set by Judge

Robinson for when the claim construction briefs and summary judgment briefs would be due, it was based on when these reports would be finished and also when the depositions of the experts, based on those report dates, would be concluded. I believe right now the schedule provides that the dates for the conclusion of the expert depositions is at the end of June. So it obviously has a ripple effect

on the dates for the expert reports, the dates for the conclusion of the expert depositions, and then the dates for the submission of the opening briefs on summary judgment and Markman. THE COURT: September 10th. And I believe that briefing date is

Does that look right to you? That is right, Your Honor. We

MR. JACOBS:

built in a pretty big gap there.

We actually negotiated

with the defendants a schedule and we built in a pretty big gap in case there were any necessary changes during the

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 23 of 27 23

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

summer time frame, and based upon the representation of both parties that there was some vacations going on in the summer as well. So there is plenty of time in there to add a

little bit of additional time and to cure any potential prejudice that might be here and to still keep things at the tail end on track. THE COURT: report due on May 28th? MR. JACOBS: That is everybody that is doing a Is it only defendants that have a

rebuttal to an issue which they did not bear the burden originally, Your Honor. THE COURT: MR. JACOBS: Okay. But we had agreed, Your Honor, that

we certainly did not expect them to respond or address these contentions in that, you know, May 28th rebuttal and that we would give them additional time to supplement. If the Court

decided that these claims were permitted to come into the case, certainly, we would give them additional time to allow their experts to address that. THE COURT: Okay. Mr. Fabricant. Could I?

MR. FABRICANT: THE COURT:

Yes.

Yes. I'm sorry. Could I add one

MR. FABRICANT:

thing to the record, Your Honor?

I have the document in

front of me now, so one sentence that I would like to read

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 24 of 27 24

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

into the record? THE COURT: Go ahead. And that is from the Stec report That is our damages expert

MR. FABRICANT:

that created this entire issue. report.

There was actually one sentence in his very lengthy

report which had anything to do with this issue, and it read as follows: The FillBox component is used to load unit doses without the PickRing into patient specific compartments or dedicated ward and pharmaceutical bins, footnote 40. And footnote 40 reads: A reference to Swisslog

Healthcare Solutions automated drug management system brochure at Page 9. That is the entire reference in the Stec report to the entire issue referencing not conversations with people, not interviews with witnesses but a brochure that was on the website from Day One of the lawsuit. THE COURT: And, Mr. Jacobs, do you find more

in the Stec report than what Mr. Fabricant is saying? MR. JACOBS: Well, I wonder why that report was

not produced during the course of discovery, Your Honor, if it was on the website. Usually these types of facts are Certainly, if you look

provided via discovery in the case.

at the Stec report, there are many, many references, Your Honor, to his conclusions being based on a number of

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 25 of 27 25

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

conversations. Now, I would agree with Mr. Fabricant that I don't believe that that particular sentence was tied in the report to a discussion. But if you look at the report

globally, he talks about all of the discussions he had with a number of people to derive and come up with the opinions and the conclusions that he represents in the report. THE COURT: Okay. Thank you.

MS. ONDRICK:

And, Your Honor, I don't believe

that that particular document that he is even referencing makes the statement that it's an alternative to the PickRing. THE COURT: Okay. Thank you. I have enough on

all of that at this point. Here is what we're going to do. We're going to

continue the schedule as it is so whatever rebuttal reports that you were all working on for May 28th, those are still due on May 28th. If we decide to allow McKesson to add the additional claims, then obviously you will hear that from us. And I will understand that we'll need to do some kind

of modification, it's unclear yet as to how extensive but some modification to permit some type of supplemental expert reports which may have some impact on the termination of

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 26 of 27 26

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

expert discovery. In no event, however, will any of this have any effect on the trial date. what it is. The trial date is going to stay I'm going to take

So continue as you were.

this issue under advisement; and you will hear from us in short order. MR. JACOBS: Thank you, Your Honor. Thank you. Your Honor, may I

MR. FABRICANT:

just raise a different issue for one second? THE COURT: Yes. We received a letter last

MR. FABRICANT:

evening actually after our day was over for me which added some additional cases and addressed the motions we had the other day before Your Honor. THE COURT: respond to that? MR. FABRICANT: Well, I don't believe the cases Yes, I saw that. Did you want to

change what was stated at the oral argument with respect to the issue of what you do when you look at a document which makes no reference whatsoever within its four corners to other documents in a situation. I would ask the Court if

the Court would like to give us until Tuesday to send in a letter in response, if Your Honor wants a response. THE COURT: I'll leave it up to you, but you

have until the end of the day Tuesday, but you have got to

Case 1:06-cv-00028-SLR-LPS

Document 307

Filed 05/28/2008

Page 27 of 27 27

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

keep it to two pages, just as the folks on the other end did; okay? MR. FABRICANT: THE COURT: have a good weekend. MR. JACOBS: you. THE COURT: Thank you, all. Good-bye. You do the same, Your Honor. Thank Thank you, Your Honor. In the meantime, everyone

Okay.

MS. ONDRICK:

Thank you, Your Honor.

(Telephone conference ends at 11:38 a.m.)