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EXHIBIT C

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IN THE UNiTED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

INDEX
BY: MR. SITZMAN BY: MR. HENDERSHOT
INDEX OF EXHIBITS

3 EXAMINATION
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4 MCKESSON iNFORMATION
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SOLUTIONS, LLC, ) ) PLAINTIFF, ) vs. ) Case No. 04-1258-SLR

PAGE 5, 292 277

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9 NTJMBER DESCRIPTION PAGE 10 MM-i Multi-page Expert Report of Mark 5
A. Musen, M.D., Ph.D.
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7 THE TRIZETTO GROUP, INC., )

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DEFENDANT.

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MM-2 Rebuttal Expert Report of Mark
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A. Musen, M.D., Ph.D.; 37 pages MIvI-3 United States Patent Number 5,253,164

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MM-4 Paper entitled 'An Access-oriented
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Negotiated Fee Schedule, The Caterpillar Experience," pages

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VIDEO DEPOSITION OF MARK MUSEN, M.D., PI-LD. Held at Skadden, Arps, Slate, Meagher & Flom 525 University Avenue, 11th Floor Palo Alto, California Tuesday, November 22, 2005, 9:11 a.m.

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349-357

17 MM-S Memorandum Order; 4 pages 18 MIvI-6 PEW Conference Presentation
Managing Physician Fees; 4 pages
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109 173

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MM-7 Vendor Comparison dated 1-18-88; 180 20 1 page 21 MM-8 Exhibit C, Materials Examined; 193
9 pages

22 23 24 REPORTED BY: CHRIS DE GEORGE, CSR. NO. 7069 25
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MM-9 Expert Report of Dr. Margaret
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L. Johnson, Ph.D; 30 pages

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APPEARANCES
For the Plaintiff:

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BE IT REMEMBERED that, pursuant to Notice, and 9:11 a.m. thereof, at the Law Offices of Skadden, Arps, Floor, Palo Alto, California, before me, Chris De

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2 on Tuesday, November 22, 2005, commencing at the hour of
Skadden, Arps, Slate, Meagher & Flom, LLP BY: MICHAEL HENDERSHOT and JON SWENSON, Attorneys at Law 525 University Avenue, 11th Floor Palo Alto, California 94301

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4 Slate, Meagher & Flom, LLP, 525 University Avenue, 11th 6 George, CSR #7069, State of California, there personally 7 appeared
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MARK MUSEN, M.D., PH.D., first duly sworn, was examined as is hereinafcer set forth. --oOo--

(650) 470-4500
For the Defendant: GIBSON, DUNN & CRUTCHER LLP BY: MICHAEL A. SITZMAN and DANIEL MUINO, Attorneys at Law One Montgomery Street San Francisco, California 94 104-4505
(415) 393-8221 msitzman).aibsondunn.com

9 called as a witness herein by Defendant, who, being
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02:27 08:39 09:10 09:10 09:10

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Also present: Michael Barber, Videographer

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THE VIDEOGRAPHER: Good morning. My name is Michael Barber. I am a videographer associated with 16 Barkley Court Reporters located at 222 Front Street, 09:11 17 Suite 600, San Francisco, California 94111. The date is 09:11 18 November 22nd, 2005. The time is 9:11 a.m. 09:11 19 This deposition is taking place at Skadden, 09:11 20 Arps, Slate, Meagher & Flom, LLP, 525 University Avenue, 09:11 21 Palo Alto, California 94301 in the matter of McKesson 09:11 22 Information Solutions, LLC, versus the TriZetto Group, 09:11 23 Inc., Case Number 04-l258-SLR. This is the videotape deposition of Mark 09:11 24 09:11 25 Musen, M.D., Ph.D. being taken on behalf of the defense.
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would have a bearing on -- on this situation that you're describing for me. Q. Okay. But if-- I hate to repeat myself, but if the appendectomy were not thrown in, I -- I'm going back to your comment that it --you know, a computer system can't be clairvoyant -A. Right. Q. -- and I'm looking just really just at the claims of the '164 patent. Are there any claims of the '164 patent that would enable somebody to create a system that would know that the constituent pieces had been.

claims or two codes, one with and one without contrast.

A. Correct.
Q. And your comment is, is that the '164 patent would see those and, what, rebundle them as to just plain old CT? A. No. It would rebundle them as CT scan with and without contrast. Q. And that would rebundle it to a code that had not been submitted.

11:06 10 11:06 11 11:06 12 11:06 13 A. Ab- -11:06 14 Q. -- unbundled? 11:06 15 A. Absolutely, because if I were receiving a 11:06 16 claim for a procedure like laparotomy, which is a 11:06 17 perfectly legitimate procedure, and I also receive claims for procedures that were, in your terms, children 11:06 18 of the laparotomy, the '164 patent would determine that 11:06 19 11:06 20 those need to be bundled for -- for a different kind of 11:06 21 reimbursement. 11:06 22 Now, what -- what -- what no computer would know is whether the laparotomy was really the central 11:06 23 11:06 24 focus of the surgeon's procedure. All the computer 11:07 25 system would be able to do is deal with the fact that
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A. That's correct. Q. A number that had not been submitted. A. That's correct. Q. All right. In that hypothetical, where in the
claims of the '164 patent is that described? A. What the patent specification describes in the R rules in Appendix B is a way of doing a substitution. The claims themselves deal with identifying the offending situation, not necessarily with rectifying the problem. Q. Okay. So let's -- let's work with the CT scan. Let's -- let's go to Appendix B and maybe you can help me with where you would see that rule. "R" standing for replace, right? A. Yeah, exactly. If I can fmd Appendix B. Q. I think it begins on page -- on Column 47.
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here comes a code for a laparotomy and other associated codes which really should be bundled into that procedure code. Q. And if I -- ifI understand you correctly, the computer system described, enabled, disclosed, claimed in the '164 patent requires as a-- as a-- as a primary element, because it can't be clairvoyant, as you're saying, that the fundamental feature, the laparotomy or the appendectomy, whatever one you want to choose, has t be part of that initial claim; otherwise, it can't take action. MR. HENDERSHOT: Objection. Misstates his
testimony.

11:07 1 A. Okay. 11:07 2 Q. And I think you were referring to Rules Rl 11:07 3 through R4. 11:07 4 A. Yep. Exactly. 11:07 5 Q. And I guess what I would draw-- I would draw 11:07 6 your attention -- I don't want to presuppose, but I 11:07 7 think you were describing something that looked like R2. A. Yeah. 11:07 8 11:07 9 Q. But-- but I don't want --you know.
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A. Let me just have a chance to look at it.
Q. Please.

A. Precisely.
Q. say --

All right. So if A code CT code, which we can

THE WITNESS: Yeah. It -- it certainly has the ability to reject the entire claim if-- if-- if
the constellation of codes don't make any sense. BY MR. SITZMAN: Q. But on the unbundling-rebundling process, it has to have at least that parent.

A. No, because when we deal with other situations such as the CT scan with contrast, CT scan without contrast, that's a situation where there -- the parent is not specified but it's pretty obvious that those get bundled into a composite. Those are sibs. Q. The hypothetical is, is that there's two
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THE REPORTER: Say it again, please. THE WITNESS: So in this -- in this situation, A code would be CT with contrast, B code would be C code without contrast, and the computer would substitute C code, which is CT scan with and without contrast. BY MR. SITZMAN: Q. Okay. All right. Now let's jump to the end of the patent where the claims are. Where in the claims, starting at Column 117, where would that rule -which claim or where in the claims would that rule be carried out, or where is that rule embodied?
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MR. HENDERSHOT: And do you mean is the entire 11:11

rule, every element of rule carried out, or which claims are necessary to implement that rule? MR. SITZMAN: I -- I don't know what my choices were. MR. HENDERSHOT: Are -- are you asking which claims describe every -- every step in that rule, or which claims are -- are necessarily practiced to -- to implement that rule? 11:08 10 MR. SITZMAN: Which claims express that rule. 11:09 11 THE WITNESS: The claims are not orthogonal to 11:09 12 the embodiment but they form the embodiment. 11:09 13 Claim 2, for example, is essential for that 11:09 14 particular rule that we just discussed. It deals with 11:09 15 rejecting medical service codes, which are mutually 11:09 16 exclusive due to non-medical criteria. And I don't know 11:09 17 if you agree with me, but I would say that in this 11:09 18 situation, billing for the two types of CT scans is not 11:09 19 related to patient care. It's an artifact of the 11:09 20 billing process. Therefore, I view that as a 11:09 21 non-medical criterion. And I have the reasoning which 11:09 22 allows me in the R2 rule to identify that those two 11:09 23 codes are mutually exclusive, and I can use the -- the 11:09 24 computation supported by the claim-- by Claim Number 2 11:09 25 ultimately to bill Rule 2. But I -- but Claim 2 doesn't
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in this hypothetical is a claim that has two codes on it, one for CT with contrast and one without.

A. Yes.
Q. Okay. Then going to the next step, "ascertaining whether the at least one claim contains a plurality of medical services codes," well, it contains two, right?

A. Right.
Q. So we've got to say that's a plurality.

A. Correct.
Q. Anything more than one, right?

A. That's my understanding.
Q. Okay.

MR. HENDERSHOT: We've skipped over the preamble. Are we assuming that all of that's present in the process as well, or are we just going through the steps? MR SITZIvIAN: I think we have to assume that it is a computer system that has means for operating on a predetermined basis. MR. HENDERSHOT: Okay. BY MR. SITZMAN: Q. Let's assume that that's the system.

A. Okay.
Q.

All right. Next step: "determining whether
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necessarily specify what to do about what -- what to do

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about the infringing situation when it's detected. BY MR. SITZMAN: Q. Okay. Let me break down a couple things that you said. First of all, the --the non-medical criteria, what is the actual criterion that you were just applying that makes, as we've said, CT scan with contrast, CT scan without contrast, what makes those either mutually exclusive, or what is the non-medical criterion that's applied? A. To state it informally, it would be that the patient is undergoing a single procedure in one sitting that happens to have two components where the, in this case, the payer has determined that those components need to be considered as a unit and, therefore, not paid separately. It's non-medical because it's -- it's a function of how the payer has decided to manage reimbursement. It has nothing to do with the state of the patient. The patient is not even informed, necessarily, of what -- ofhow the procedure is billed. Q. Okay. So let's walk through the steps. This is a -- this is one of the method claims -- ofhow this would work, the steps of-- first step, receiving at least one claim. So the claim that we're talking about
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one of the medical service codes in the at least one claim is mutually exclusive due to non-medical criteria with any other medical service code in the at least one claim." All right. So explain how that happens with the example that we've got. We've got the two CT codes.

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A. Right. And what did we say that was? That

11:12 7 was RuleR2-11:12 8 Q. Right. A. -- in Appendix B? That defines relationships 11:12 9
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in the database among CT scan with contrast, CT scan without contrast. It indicates that those two claims or those two service -- corresponding service codes are mutually exclusive. Q. Okay. They're mutually exclusive due to the non-medical criteria, the non-medical criteria being -A. That the payer has decided that those two service codes need to be reimbursed as a unit. Q. And that's non-medical because the decision was made by the payer? A. It -- it does not deal with the procedure performed by the practitioner but, rather, is a-- is an artifact of the reimbursement process, yes. Q. Okay. So -- so it -- they're mutually exclusive. Then we go to the next step which is:
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11:32 1 set forth or carried out in Claim 2 or any of the other 11:32 2 claims set forth here? 11:32 3 MR. HENDERSHOT: In all possible scenarios or 11:32 4 just generally speaking? 11:32 5 MR. SITZMAN: Well, I was using all those
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11:32 7 MR. HENDERSHOT: Okay. 11:32 8 MR. SITZMAN: -- to cover all of your 11:32 9 concerns.
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MR. HENDERSHOT: I guess my question is does every possible embodiment of EP have to fall within Claim 2? Is that your question? MR. SITZMAN: Oh, no, no, no. MR. HENDERSHOT: Okay. MR. SITZMAN: No. Q. Can you find -- can you find the EP rule in any of the claims that we've got here, in any of the 16 claims?

11:34 1 A. As I said earlier, reading the patent, it's 11:34 2 clear that the specific claims that are made are -- are 11:34 3 more limited than the capabilities described in the 11:34 4 embodiment. 11:34 5 Q. Okay. The same similar question with -- with 11:34 6 regard to Rule EA which focuses -- focuses -- it 11:34 7 mentions age as one of the criteria. Same respome, 11:35 8 that's not -- or my same comment, I don't see age 11:35 9 being -11:35 10 11:35 12 11:35 13 11:35 14 11:35 15 11:35 16 11:35 17 11:35 18 11:36 19 11:36 20 11:36 21 11:36 22 11:36 23 11:36 24 11:36 25
A. Age -- age is not a medical service. Just as

11:35 ii before the break when we talked about the sex of the
patient, that's obviously not a medical service code either. Q. Okay. What about, let me ask you, the -there are three Q rules here: QM, QS, and QB. Are those embraced or set forth in any of the claims, or is that part of some other process that one could use? A. Again, just looking on the left-hand side of the rule, which is all the --the claims deal with, there is a determination of whether, in this case of QM, ACODE is incompatible with codes in the range of B to D.

A. Yes.
Q. Okay.

A. And I think in Claim 2, in a particular situation where a particular service code was mutually incompatible with another service code based on the place of service, that represents that kind of a
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11:33 1 Q. Okay. 11:33 2 A. That presumably would be non-medical. 11:33 3 Q. Okay. Place of service would be non-medical? 11:33 4 A. Well, again, it -- it's a function of the 11:33 5 artifact of billing rather than a procedure as applied

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directly to the patient. The -- the constraint is one that deals with the -- with the setting of care and what is reimbursable in one setting versus another, as --as I read the rule at least --

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11:36 10 11:36 11 11:36 12 constituent of the procedure that's performed on the 11:36 13 patient, which would be medical. 11:37 14 Q. Okay. But at -- looking at Rule -- sorry-11:37 15 Claim 2, it -- it does talk about that mutual 11:37 16 exclusivity, but as I look at the rule set forth in EP, it's the -- the issue is not one of mutual exclusivity 11:37 17 amongst the codes but whether or not the POS, the place 11:37 18 11:37 19 of service, occurs at some place or -- or another as to 11:37 20 the exclusion. A. lagree. 11:37 21 A. Okay. The point is well taken, and the place Q. Okay. All right. Let's -- let's turn now to 11:37 22 the claims themselves, starting at Column 117. IVs of service is not a service code. 11:37 23 like that last page, and I want to ask you about the Q. And I did not see place of service in any of 11:38 24 means -- the "means for" language that appears there. the other claims, but I didn't know if you had in mind one of the claims that --that might embrace that. 11:38 25 Let's take the first one on Claim 1.

Q. Okay.

A. -- rather than what is a -- an intrinsic

rule, that's not in the claims, the -- that there's a question about the combination of the codes. MR. HENDERSHOT: All the independent claims or including the dependent ones as well? There might be one that we're overlooking. MR. SITZMAN: I don't know. I want to look at all 16, 1 guess, except for 7. MR. HENDERSHOT: Okay. TI-IE WITNESS: I mean, the --the -- the claims talk about means for rejecting codes but I -- that's rather open-ended as to what that means could be. And so I think it's -- it's fair to say again that the left-hand side is -- is -- is covered, the right-hand side is a particular implementation detail. BY MR. SITZMAN: Q. Okay. And fmally, Li at the top, that's a limit of payment, if I read the -- that-- that code there, that rule does not appear fully, you know, the entire rule anyway, in any of the 16 claims.

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A. Yeah. Q. In a computer system having, and it says
"means for." You see that?

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A. Yeah.
Q. And then there's a bunch of language after that. Is it your understanding that the language appearing after the "means for" phrase, that that language is the functional language of the claim?

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patent where the exact software that is used is identified? MR. HENDERSHOT: Objection. Vague and ambiguous, the "exact software that is used." BY MR. SITZMAN: Q. Okay. Well, let's start with code. Does -is there code identified?
(Witness sneezes.) MR. SITZMAN: Bless you. MR. HENDERSHOT: Bless you. THE WITNESS: I'm fine. Well, certainly. Obviously, there is the Clipper listing in the back of the patent which is really, from my perspective, more annotation than anything else, but it gives an example of how code can be written to achieve the claims of the patent. I think most specifically what would be most important to -- to one skilled in the arts to -- to create such an invention is the information given in Appendix B and -and the database structure in -- in Appendix C. BY MR. SITZMAN: Q. Let me just see if I clarify. The --the exact structure that's identified in the patent that performs the function that we were just talking about, the operating on a predetermined database along with
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9 MR. HENDERSHOT: Just the following clause or 11:41 10 all the language in the claim? I assume it's 11:41 11
the following clause. MR. SITZMAN: The following clause. MR. HENDERSHOT: Okay. THE WITNESS: Yes. MR. SITZMAN: The following clause is the functional aspect of the clause. Okay. Q. Does -- does the three products from TriZetto perform that identical function that's described? Let's take the first one, "the operating on a predetermined database containing medical service codes and a set of relationships among the medical service codes defining whether selected ones of the medical service codes are valid when input with other selected ones of the medical service codes."
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11:39 1 A. Yes. 11:39 2 Q. Okay. How do you know that it performs that 11:39 3 identical function? 11:39 4 A. I know that by looking at the product 11:39 5 literature that I've been -- been given and by reviewing
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the testimony of all those who were deposed in this case. Q. Okay. Where in your report, MM- 1, is the structure identified that corresponds to the function that I just read into the record? A. The structure is software. My understanding in this case is that it is sufficient to say that the function is implemented in software. Q. Is -- is there any particular software or are you just saying software? A. Well, the patent specification gives a particular embodiment for how that software might be constructed, but at issue is whether software is used to perform this particular function, a function which, until this patent, had been done only manually.

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that other language that I won't repeat -A. Right, right, right. Q. -- that I won't repeat, the structure that's identified in the patent is the Clipper language that appears in the, I think it's Appendix D of the patent, the rules that appear in Appendix B, and the database structure that appears in Appendix C. MR. HENDERSHOT: Well, objection. Misstates his testimony. MR. SITZMAN: Okay. THE WI1'NESS: Okay. Again, I'm -- I'm -- I'm not an attorney so I want to be careful here. My understanding is that the patent simply states that the structure is software and gives each of those as examples of how one might embody software to have the function. BY MR. SITZMAN:

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Q. Does the patent give, you know, like the
actual algorithm that one would use to do that, to -- to sort of create that functionality that we're talking about, the means for operating that we're talking about?

21 Q. Okay. So software is used. Can you identi' 11:40 22 then -- well, let -- let's be clear. Your report 11:40 23 does- -- doesn't call out exactly what software is used. 11:40 24 A. That's correct. 11:40 25 Q. Okay. Can you identify for me, though, in the
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A. Sure.
MR. HENDERSHOT: Oh. It may be vague and ambiguous as to algorithm. As long as you guys are on the same page.
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try the approach that Dr. -Q. Hertenstein. A. -- Hertenstein had used but, rather, to

Q. You could do it, though. You could do it at

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4 finesse the problem by using the DRG approach. 5 Q. All right. 6 MR. SITZMAN: Can we take a quick break? Do

02:12 2 the time that the article was written. That -- that was 02:12 3 the important part there. 02:12 4 A. You could recognize this one situation, yes. 02:13 5 Q. In a computerized system.
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A. If you had a means for acquiring the claim,

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02:13 7 which obviously is the first step, but yes. 02:13 8 Q. Okay. Now, returning to the patent for a 02:13 9 second and comparing Rule E2 to what is in Table 4 -A. What column are you on? Q. Oh, it's Column 47.

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02:13 11 12 The time is 2:02 p.m., and we are off the 02:13 12 13 record. 02:13 13 14 02:13 14 (Recess taken.) 15 THE VIDEOGRAPHER: Back on the record. This 02:13 15 16 is the beginning of Videotape Number 3, Volume 1, in the 02:13 16 17 deposition of Mark Musen, Ph.D., M.D. The time is 02:13 17 18 2:10 p.m. on November 22nd, 2005. 02:14 18 19 BY MR. SITZMAN: 02:14 19 20 02:14 20 Q. BacktoMM-4-21 A. Okay. 02:14 21 22 02:14 22 Q. -- and Table 4, Ijust want to make sure we're 23 clear on a couple things. 02:14 23 24 02:14 24 Writing a computer program or writing a 25 knowledge-based system -02:14 25
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11 Musen, M.D., Ph.D.

A. Okay.
Q. Isn't Rule E2 a rule designed to carry out what is set forth in Table 4? MR. HENDERSHOT: Objection. Vague and ambiguous as to "designed to." THE WITNESS: The procedure represented by Rule E2 would carry out the step that Hertenstein did in this one example, yes. It would obviously apply in multiple other examples, and being able to come up with a general rule and know its applicability is, obviously, the interesting part of the patent. BY MR. SITZMAN: Q. So -- right. So you could come up with Rule E2 to deal with Table 4, but the beauty is E2 also
Page 167

02:11

1

A. Right.
Q. -- or using a knowledge-based system to get to a solution, any of those three, that dealt with the bundling problem set forth in Table 4 only, would have been obvious to one of ordinary skill of the art, given the Egdahl-Hertenstein disclosure. A. I -- I'm not trying to be difficult, but the -- the information in Table 4 provides one result of the millions and millions of possible combinations of claim codes. So it would be obvious that there would be a way of solving this one particular case out of the many millions, but Fm not sure why anybody would want to begin to try to solve a case that actually might never occur again, given this particular combination. Q. Right. No, I -- I understand. So this -- but it would have been obvious given this disclosure to deal -- you could deal with this one. Sony. I'll make it

02:11 2 02:11 3 02:11 4 02:11 5 02:11 6 02:11 7 02:11 8 02:11 9
02:11 10 02:12 11 02:12 12 02:12 13 02:12 14 02:12 15 02:12 16 02:12 17 02:12 18 02:12 19 02:12 20 02:12 21 02:12 22 02:12 23 02:12 24 02:12 25

02:14 1 could deal with other things. 02:14 2 A. Right. And you could imagine other frame -02:14 3 other formulations of rules that would match the editing 02:14 4 processing being done in Table 4 that would have a 02:14 5 representation different from Rule E2 which would seem
02:14

6

to be sufficient for the problem that the figure

02:14 7 identifies, and only with experimentation would you 02:14 8 realize that either you had been too general or too 02:14 9 specific and would want to recast the way in which you
02:14 10 02:15 11 02:15 12 02:15 13 02:15 14 02:15 15 02:15 16 02:15 17 02:15 18 02:15 19 02:15 20 02:15 21 02:15 22 02:15 23 02:15 24 02:15 25
were dealing with the situation in Table 4 in some other way. Q. Okay. Now, we've already talked, again, just, sort of looking at the rules now on the patent side, we know that Rules Ri through R4 are not in the patent claims.

more specific. You could write a program to deal with this one, even though there are -- are millions of other relationships and issues and even though this one exclusivity or unbundling problem may never ever come along again. A. People would question your sanity but, yes, you could do it.
Page 166

A. That's not true. The -- certainly the left-hand sides of those rules are. Q. Okay. The entirety of those rules, those rules are not express from start to finish -A. [Simultaneously] That's correct. Q. -- in any of the patent claims. Okay. E2 is, and we've just talked about the fact that that was a rule that would deal with the Table 4 problem in the Hertenstein article. El, El is in the patent claims, right?
Page 168

42 (Pages 165 to 168)
MARK MUSEN, M.D., PH.D.

Case 1:04-cv-01258-SLR
04:46 04:46 04:46 04:46 04:46 04:46 04:47 04:47 04:47
1

Document 424-3

Filed 06/22/2006

Page 8 of 208

2

3 4 5 medical service codes, comprising the steps of: 6 receiving at least one claim; determining whether any 7 medical service code contained in the at least one claim 8 is not present in the predetermined database; and 9 informing a user that a medical service code is not 04:47 10 contained in the predetermined database."
04:47 11 The first point is that a system that does DRG 04:47 12 grouping is completely unrelated to the claims

method for processing input claims" -THE REPORTER: "A method for processing input claims" -THE WITNESS: -- "containing at least one

04:49 1 Q. All right. Let's assume this patent only had 04:49 2 one claim in it. A. You do like making assumptions. 04:49 3 04:49 4 Q. Well, you know, I'm trying to understand as 04:49 5 much as I can, and assumptions are one way to do it. If
04:49

6

we say only Claim 1 exists in this patent, and we're

04:49 7 only looking at Claim 1, isn't the reference, the Doyle 04:49 8 reference or the Nathan- -- Nathanson reference, aren't 04:50 9 those -- don't those disclose the claim limitations that
04:50 10 04:50 11 04:50 12 04:50 13 04:50 14 04:50 15 04:50 16 04:50 17 04:50 18 04:50 19 04:50 20 04:50 21 04:50 22 04:50 23 04:50 24 04:50 25
are in Claim 1? MR. HENDERSHOT: Objection. Asked and answered. Well, strike that. Actually, not in the context of having only one claim. I apologize. THE WITNESS: Nathanson seems irrelevant to me. You'll have to help me understand how you think that applies. Doyle, obviously, does some degree of claims checking, and -- and inasmuch as the -- the claim made in Claim 1 addresses claim checking, then there is -there is relevance there. As I said previously, I -my -- my interpretation of the claims is that the motivation for Claim 1 is to clarify that the task performed for claim validity checking can be handled using the same structures that are ultimately used for the other components of the -- ofthe -- of the patent.
Page 267

04:47 04:47 04:47 04:47 04:47 04:47 04:47 04:47 04:47 04:47 04:47 04:48 04:48

13 processing task. The Doyle patent mentions the 14 identification of fictitious codes, but the preamble to 15 the claim describes specifically that what follows is in 16 the context of the unbundling problem. 17 BY MR. SITZMAN: 18 Q. Is it your belief that Claim 1 deals with the

19 unbundling problem? 20 A. Claim 1 describes the context in -- in many 21 ways for what follows, describing specifically the idea 22 of automated claims processing where there exists a 23 database that provides the information needed to address

24 unbundling. It -- Claim 1 does not provide the specific 25 functionality -Page

265

1 THE REPORTER: "Does not provide the specific 04:48 2 functionality" and whatever you said after that. 04:48 3 TFIE W1TNIESS: For unbundling. 04:48 4 BY MR. S1TZMAN: 04:48 5 Q. Okay. So Claim 1 doesn't provide the 04:48 6 functionality for unbundling, but it does receive at 04:48 7 least one claim, it determines whether any medical 04:48 8 service code contained in that claim is present in the 04:48 9 data- -- in a predetermined database, and then informs 04:48 10 the user whether or not the code is contained in the 04:48 11 base or not, the database or not. Is that a fair 04:48 12 characterization? 04:48 13 A. That's -- that's fair. I guess it's a legal 04:48 14 matter as to whether we ignore the preamble. 04:48 15 Q. Okay. What does the preamble add in terms of 04:48 16 the function of Claim 1? 04:49 17 A. It states that the database of claims, which 04:49 18 allows the invalidity check, also contains structures 04:49 19 which are relevant for the future claims to be specified 04:49 20 that deal with the unbundling task. 04:49 21 Q. Okay. But the future claims meaning Claims 2

04:48

04:51

1

04:51 2 04:51 3 04:51 4 04:51 5 04:51 6 04:51 7 04:51 8 04:51 9
04:51 10 04:51 11 04:51 12 04:51 13 04:51 14 04:51 15 04:51 16 04:51 17 04:51 18 04:51 19 04:51 20 04:51 21 04:52 22 04:52 23 04:52 24 04:52 25

Q. Right. But if we just focus in on claim validity checking, which I think is a fair characterization of Claim 1.

A. Yes.
Q.

I mean, will you agree with me that --

A. Yes. Q. I -- I think that was your phraseology was
claimed validity checking. Claimed validity checking was not something, by itself, that was novel at the time of this, the filing of this patent application. MR. HENDERSHOT: I -- Fm going to object and assert that it's vague and ambiguous, at least to me, as to whether or not claimed validity means the -- valid as in appropriate for payment or some sort of-Fm going to object to the question as vague and ambiguous as to what "claimed validity" means. I understand -- I don't believe that I follow what's being -- what's being used, and I apologize for that if I don't. MR. SITZMAN: Oh, rm sorry. Did I say-code validity checking. Sony. MR. HENDERSHOT: All right. BY MR. SITZMAN: Q. Code validity checking. A. And I guess my -- my response is that,
Page 268

04:49 22 through 16. 04:49 23 A. Correct. And so Claim 1 is saying that we can
04:49 24 perform the validity check and use the same structures 04:49 25 that ultimately will be useful for those other claims.
Page 266

67 (Pages 265 to 268)
MARK MUSEN, M.D., PH.D.

Case 1:04-cv-01258-SLR
04:52 1 04:52 2 04:52 3 04:52 4 04:52 5 04:52 6 04:52 7 04:52 8 04:52 9

Document 424-3
04:54 1 04:54 2 04:54 3 04:54 4 04:54 5 04:55 6 04:55 7 04:55 8 04:55 9
04:55 10 04:55 11 04:55 12 04:55 13 04:55 14 04:55 15 04:55 16 04:55 17 04:55 18 04:56 19 04:56 20 04:56 21 04:56 22 04:56 23 04:56 24 04:56 25

Filed 06/22/2006
in Claim 13?

Page 9 of 208

04:52 10 04:52 11 04:52 12 04:52 13 04:52 14 04:52 15 04:52 16 04:53 17 04:53 18 04:53 19 04:53 20 04:53 21 04:53 22 A. Yes,Ido. 04:53 23 Q. Okay. And you would have the same responses 04:53 24 vis-a-vis the Doyle patent with regard to Claim 13? 04:53 25 MR. HENDERSHOT: I want to interpose an
Page 269

clearly, the Doyle patent has a component of code validity checking which is provided functionally in Claim 1. The structure is -- is -- is obviously different. Q. Okay. And -- and how is the structure different? A. The structure is different in that the database for validity checking is designed in a way to support that task, as well as the other tasks which we don't want to talk about. If we were willing to talk about the other claims in the patent, then I think in that context it -- it makes sense that Claim 1 is an advance over what's claimed in Doyle. Q. It's an advance but a functional equivalent. A. It's a functional equivalent in the context of a system that also does unbundling. Q. Right. Okay. Claim 13, same series of questions, and -- and we can -- we can narrow it to Doyle in that I also consider, and I wanted to know whether or not you consider, Claim 13 a claim -- sony, a code validity checking claim.

A. Okay. Take- -- taking the claim completely
out of context, yes. Q. Okay. Out of context in the sense of looking at it by itself?

A. Yes.
MR. HENDERSHOT: And looking at eveiy limitation? MR. SITZMAN: Yes. MR. HENDERSHOT: Okay. BY MR. SITZMAN: Q. I want to turn your attention to Advanced MedLogic, pages 24 and 25 of your report. I think I'm going to skip that. Hold on. I think we covered a lot of that. Now, Doctor, doesn't -- getting back to the Hawley report, doesn't the fact that Dr. Hawley was working on a similar solution, the unbundling task and solution, at the same time as the assignee and patentees of the '164 patent-- and they were doing it on opposite coasts, by the way -- doesn't the fact that he was working on it at the same time and coming to a solution suggest the obviousness of the '164 patent? MR. HENDERSHOT: Objection. Assumes facts not in evidence with respect to them working at the same
Page 271

04:53 1 04:53 2 04:53 3 04:53 4 04:53 5 04:53 6 04:53 7 04:53 8 04:53 9

objection to this line, again, about validity. I've 04:56 1 heard "valid" used in the context of the database with 04:56 2 relationships to finding whether or not a code is valid 04:56 3 with other codes. I'm also aware implicitly in the 04:56 4 conversation there is a -- may be another meaning from 04:56 5 the computer science standpoint. And to the extent that 04:56 6 the -- the questions don't delineate really which one or 04:56 7 the other, I object to it as vague and ambiguous. 04:56 8 THE WITNESS: As I read Claim 13 -04:56 9 04:54 10 BY MR. SITZMAN: 04:56 10 04:54 11 04:56 11 Q. Right. A. -- I view that as a means for determining 04:54 12 04:56 12 04:54 13 whether the code is in the database, meaning whether the 04:56 13 04:54 14 code is valid in a computer science sense. The other 04:56 14 04:54 15 claims in the -- in the patent use the term "valid" and 04:56 15 04:54 16 there it seems to mean valid for payment. 04:57 16 But -- but, again, let's just focus on 04:54 17 04:57 17 Q. Right.

time and to the extent that it implies that it was completely independent. BY MR. SITZMAN: Q. Let -- let's assume that it was completely independent, and let's assume that it was at the same time. A. All I can say is that it might be obvious to tiy. Q. Okay. But you would agree with me, though, if-- if you think about, you know, multiple people at multiple places all trying independently.

A. Right.
Q. You know, with no coordination, coordination with each other, to come up with a solution and they come up with probably various solutions to the same task, doesn't that indicate to you, though, that the solution may have been obvious, especially if multiple people were independently developing it at the same time? MR. HENDERSHOT: Objection. Asked and answered. THE WITNESS: I look at the questions that appeared after the -- the Egdahl-Hertenstein article that we discussed -BY MR. SITZMAN:
Page 272

04:54 18 04:54 19 04:54 20 04:54 21 04:54 22 04:54 23 04:54 24 04:54 25

13.

A. Okay. Q. And wouldn't you -- would you agree with me,
then, that the Doyle patent also discloses a -- that same functionality in that it checks to see -- I'm looking at your characterization -- checked to see if diagnosis and procedure codes are "fictitious" by looking them up in a database much like that described
Page 270

04:57 18 04:57 19 04:57 20 04:57 21 04:57 22 04:57 23 04:57 24 04:57 25

68 (Pages 269 to 272)
MARK MUSEN, M.D., PH.D.

Case 1:04-cv-01258-SLR

Document 424-3

Filed 06/22/2006

Page 10 of 208

1 2
3

State of CALIFORNIA

County of 3i C'

4 5 6
7 8

I, the undersigned, declare under penalty of
that I have read the foregoing transcript, and I have

9

made any corrections, additions or deletions that I was desirous of making; that the foregoing is a true and
correct transcript of my testimony therein.
EXECUTED this
2005, at __________________,

10
11 12

day of _____________

13

(City)
14 15

(State)

16

____ , pL
MARK MUSEN, M.D., PH.D.
19 20 21 22
23 24

25
326

MARK MUSEN, M.D., PH.D.

Case 1:04-cv-01258-SLR

Document 424-3

Filed 06/22/2006

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EXHIBIT D

Case 1:04-cv-01258-SLR
1 -

Document 424-3

Filed 06/22/2006

Page 12 of 208

2
3

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE CIVIL ACTION NO. 04-125 8 SLR

1 APPEARANCES: 2 On behalf of the Plaintiff:
3

4
5

4
:
5 6 7 9 10
11

BERNARD SHEK, ESQ.
Skadden, Arps, Slate, Meagher & Flom, LLP 525 University Avenue, Suite 1100 Palo Alto, California 94301 (650) 470-4500 MICHAEL A. SITZMAN, ESQ. Gibson, Dunn & Crutcher, LLP One Montgomery Street Telesis Tower, Suite 31 San Francisco, California 94104-4505 (415)393-8221 BRENT TROUBLEFIELD, VIDEOGRAPHER

6 MCKESSON INFORMATION : 7 SOLUTIONS, LLC, 8 : Plaintiff,

8 On behalf of Defendant:

9 vs.
11

:

10 THE TRIZETTO GROUP, INC.:
Defendant.
:

12 13 14 15 17

-----A

Durham, North Carolina Friday, September 23, 2005

12 13 14
15

VIDEOTAPE DEPOSITION OF KELLI A. DUGAN, 18 a witness herein, called for examination by counsel 18 19 for the Defendant, in the above-entitled matter, 19 20 pursuant to notice, the witness being duly sworn by 20 21 DARLENE M. BRYANT, Registered Professional Reporter 21 22 and Notary Public in and for the State of North 22 23 Carolina, taken at the offices of Interactive World, 23 24 1000 Park Forty Plaza, Suite 300, Durham, North 24 25 Carolina, at 8:06 a.m., September 23, 2005, and the 25
Page 1

Page 3
1

1

proceedings being taken down

2

by Stenotype by DARLENE M. BRYANT and transcribed under her direction.

C ON TENT S
EXAMINATION BY COUNSEL FOR Defendant Plaintiff 7, 180 177

2

3

4
5

3 THE WITNESS 4 KELLI A. DUGAN: 5 By Mr. Sitzman:

6 7
8

6 ByMr.Shek:
7
8

9
10
11

9
10

EXHIBITS
PAGE NO.

11 EXHIBIT NO.
12

12

13

13
14 15 16 17 18 19

7-29-87, Holloway to Fager 2 10-14-87 Holloway to Fager
1

53 55
66

14
15

3 USPatent5,253,164

16 17 18

103 4 Subpoena 5 Article, The Caterpillar Experience 105
6 Memo, 1-29-88, Holloway to Egdahl

108

19
20

7 5-20-88, Holloway to Egdahl 122 8 RICS 9 Flow Charting Worksheet

121

20 21 22 23 25
Page 2

124
127

21
22
23

10 Memo, To HPR Staff, 1-17-89
11 CRW, 1-25-89
12 1-26-89, Holloway To
14 12-12-89, Goldberg to

129

Bolz

24
25

24 13 2-13-89, Don & Kelli To PDT

Dugan

130 132 136

Page 4

I (Pages

1 to 4)

KELLI A. DUGAN

Case 1:04-cv-01258-SLR
1

Document 424-3
1

Filed 06/22/2006

Page 13 of 208

2
3

.5
6 7 8 9 10
11

4

speculation. Q. And when you say, doing it, are you referring to the Hertenstein manual process, or are you referring to code review, the automated process? A. You -- well, if you -- can we go back and see a question -- a couple of questions ago, I was referring to what you had said. So now you've got me confused and lost.
Q. Okay.

A. Okay. Just lIP!?

A. I'm sorry.
Q. All right. Let me -- let me break it down.
I ----

Q. It -- it was helpful for me, but it doesn't sound like it's helpful for you. So why don't we talk about prior to filing the patent application; is that any -A. That's even more difficult. Q. That's more difficult? A. lIP -- HP -- if you stick with lIP!, I think I can -- and you really mean while I was at HPI? 10 Q. Why -- can we -- can we focus on the pre-1989 11 time frame?
2 3 4 5 6 7 8 9 12 13

A. Yes. Q. -- I think you've testified that you did not 20 do any investigation into finding out whether or not 21 there were other entities that were manually 22 processing claims like Dr. Hertenstein?
Q. Okay. And did you do anything while at HPI to · 25 ascertain whether there were any companies or entities
Page 41

12 13 14 15 16 17 18 19

A. Sure.

A. You asked me something about whether Don -that -- what people were doing; what Bob had been doing. Q. Well, let's -- let's back up. While you were
at 1-IPI --

Q. Okay. So any -- at any time prior to 1989, 14 did you do anything to ascertain whether or not anyone 15 else, other than HPI and HPR, were working on an 16 automated system, much like the system you were 17 working on, that would handle claims that -- like 18 Dr. Hertenstein was doing manually?
19

A. No.
Q. Were you aware of any other companies or entities that had software that was capable of automatically processing med -- medical claims?

23 24

A. That's correct.

20 21 22 23

A. No. Processing in the way in which 24 Dr. Hertenstein had been doing manually? 25 Q. Yes. I'm sorry.
Page 43

1

2 3 4 5 6 7 8 9 10
11 12 13 14 15 16

who had automated a process like you were attempting to do for Dr. Hertenstein?

1

A. Yes.
Q. Did you do anything to determine what software programs were being used by payers that examined in any way CPT-4 codes being submitted on medical claims?

2
3

A. Could you repeat the question? And I just -for -- for reference, you keep saying HPL Can we lump HPI and HPR together, since I can't tell you exactly when I moved over to HPR? And so it's hard for me to make the distinction when you're limiting me to the lIP! time or the HPR time.
Q. Okay.

4

5 A. Could you repeat that again? I'm so sorry. 6 Q. No. That's okay. I think I'm just trying to 7 cover way too much ground in way too much short of

17 18 19 20
21

A. Unless you specifically want to know about when I was a BU employee. 12 Q. Well, that's what I'm trying to drive at. What -13 14 A. Okay. -- I'm -- I'm trying to find out, because what 15 Q. 16 happened in response to several questions ago, all of a sudden you went forward with HPR, and then also went 17 into sales of code review while you were at HPR, which 18 took us well-beyond the period that I really wanted to 19 focus on. 20

time here. At some point in time, you went to work on 10 creating software that ultimately became known as 11 CodeReview, correct?
8

9

A. Correct.
Q. Okay. When is the earliest time you can recall working on that software program?

A. Some time in '87.
Q. When you went to go work -- sony. At any time during your work on that software program, did you ever do anything to find out what other software programs existed that examined CPT-4 codes in any manner?

A. Uh-huh.
Q. And I understand that -- that it's difficult to cross over between HPI and HPR. but I really kind of want to focus on a time period that's much earlier -Page 42

21

A. Yes.
Q. What did you do?

22 23 24 25

22
23

A. GMIS came to lIP! and demonstrated Autocoder.
Q. Can you recall when they came to HPI?

24 25

A. No.
Page 44

11 (Pages 41 to 44)

KELLI A. DUGAN

Case 1:04-cv-01258-SLR
1

Document 424-3
1

Filed 06/22/2006

Page 14 of 208

Q. Did they come at your request or their

A. Yes.
Q. Is it fair to then assume that it occurred

2 request?
3 A. I don't know. 4 Q. Did you get a chance to see the -- the program 5 that they had in action?
6 7

2
3

prior to your employment at HPR?

4
5

A. Not necessarily. I can't tell.
Q. Did GMTS share with you any of the technical aspects of their computer program?

A. Yes.
Q. And can you generally describe for me that

6 7
10
11

A. No.

8 8 program that you saw? 9 A. The program was one where users would input 9

Q. You laughed. I didn't know -- was there a -something you were thinking about?

10 CPT-4 codes.
11

A. Yeah. Yes.
Q. What was that?

Q. And what would --what was the program

12 designed to do with those codes?

12
13

A. My understanding of the program is that, at 14 that time, it only ensured that you had a valid code.
13 15

A. Don had them put in one of our-- sort of-our marque claims to see what it would do with it.
And, of course, it did nothing, because it only checks the validity of the code. And then John-- Don continues to ask questions, and I just -- I just remember at the end of the meeting saying to Don, you're giving the store away, just he -- because Don was so excited. But, anyway, that's -- that's why I remember that meeting so clearly. Q. It sounds like -- I don't want to overstate or understate it, but would it be fair to say that Dr. -I keep wanting to refer to him as Dr. Holloway. Do -A. You can. He's a Ph.D. Q. Yeah. No. I know that. Is it fair to say
Page 47

14
15

Q. And how would it do that, or how would it 16 accomplish that based on your understanding? 17 A. Again, it's only speculation, because I 18 didn't -- I don't know how they worked it. But I

19 would assume they had a database of all the valid 20 codes, and it would just tell you, you know, that

16 17 18 19

20
21

21 code's invalid.
And I can't remember. You may have had an 23 opportunity to type in the procedure name, to get a 24 valid code, but if you put in a code that was invalid, 25 it would tell you it was invalid.
22
Page 45

22
23

24
25

Q. At the time you saw the odor -- Autocoder 2 system -3 A. Uh-huh. 4 Q. -- had you completed your work on the
5
automated system known as CodeReview?

1

2 3

4
5 6 8 9 10
11

Dr. Holloway was sort of the lead guy; I want to say almost, father, of this creation? Is that a fair characterization in your mind? Or if it's unfair, let me know?

A. In my mind, that's a fair characterization.
Q. Okay. So, Autocoder, if I can classify that,

6 A. Completed? Do you mean the first prototype? 7 I mean, certainly the entire time I worked on 8 CodeReview, and even after I left from HPR, it wasn't 9 complete. A software program is continually -10 Q. Okay. Did-11

7 that program from GMIIS, was being used, or that
software program had been created, to determine the accuracy of the code or the validity of the code; whether or not it was a valid code or not.

A. -- maintained.

A. That -- yes.

12 13

Q. Okay. Did you have a working prototype of the software code?

12
13

14
15 16 17 18 19

A. I believe that we did.
Q. Okay. Had you filed for the patent

application?

A. I do not know.
Q. Do you recall who else was involved in the meeting where GMIS came to HPI?

Q. Okay. Okay. By the way, now knowing what you know today, or later would learn, about Expert 14 Systems -15 A. Uh-huh. 16 Q. -- is it fair also to characterize the 17 Autocoder system as an Expert System?
18 19

A. No.
Q. Why not?

20 21 22 23

A. It was held in Dick Egdahl's actual office, which was rare, and Dr. Egdahl and Don Holloway and I are those that I remember. There may have been somebody else. I don't know.
Q. And you said Dr. Egdahl's office; was this an

20
21

22
23

24
25

24
25

office at HPI?
Page 46

A. It was simply a numerical check, to check that you had -- as you can imagine, a doctor's office may just put in the -- a wrong digit, transpose some digits. It was simply to get the code correct. So it had no thought. It was just a -- like a spell check; auto -- you know, CPT-4 check.
Page 48

12 (Pages 45 to 48) KELLI A. DUGAN

Case 1:04-cv-01258-SLR
2 3 4 5 6 7 8 9 10
11

Document 424-3
1

Filed 06/22/2006

Page 15 of 208

at Caterpillar in Peoria, may have only contained a few of the first rules that we'd developed. It was done in a modular way. And if you think of each rule as being its own sort of entity, we worked rule-by-rule, and the prototype did not have all the rules.
Q. Additional rules would have to be created in order to reach some of the results that Dr. Hertenstein would otherwise have reached himself; is that correct?

2
3

Q. You can answer. A. Autocoder, when -- when I saw it demonstrated
in Dick Egdahl's office?
Q. Yes.

4
5

A. My understanding of what! saw in Dick 6 Egdahl's office, this is what Autocoder did, yes. 7 Q. Let me have you to turn to Claim 14.
8 10
11 13

Now, let's see. I'm sony. Actually, let's

9 look at Claim 2. Sony to jump back.
Let me have you read Claim 2, and I have questions about that, too. 12 (Pause.)

A. Related to the prototype?
Q. Yes.

12 13 14
15

A. Yes.
Q. Were you aware any attempts by others to

A. Okay.
Q. You look puzzled.

16 17 18 19 20
21

create their own software that would perform this function?

A. No.
Q. Are you aware today of any other companies

that have created their own software to do this?

14 15 16 17 18 19

A. I'll probably have to read it again to really
get it.
Q. Okay. (Pause.)

A. Okay. I've read it twice.
Q. You still look troubled.

A. No.

20
21

Q. Is it your belief that HPR and their -- and 22 their successors, are the only people that have such 23 software? 24 A. I have no knowledge of that. 25 Q. While you were working at HPR, and then
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A. We can proceed, however.

Q. All right. You see -- you see the setoff there where it says, Comprising the steps of, and then 24 it lists one -25 A. Yes.

22
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1 Q. -- it lists one, two, three, four, five steps, 2 all of them starting with a verb; receiving, 3 ascertaining, determining, authorizing and rejecting;

consulting for HPR, did you ever learn of any

2 competing software that competed with CodeReview? 3 A. I don't think so. 4 Q. Did you learn of any companies that were in -5

that were competitors of-- to HPR?

6 7 8

9
10
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15

A. I have a memory that there was the thought that GMIS may have been trying to develop something that was related to this. As I told you before, they had already had the Autocoder system, and I think they were aware of what we were doing. And I -- and I think that there was a -- a thought amongst some at HPR that GMIS was -- was trying -- or wanted to create something similar. But, again, it's sort of speculation on my

part.

16 17
18

Q. Let me -- if you would, turn to Claim I of the patent.

A. Can you tell me the page?
Q. I'm sony, it's MCK65. I'm going to have you read Claim 1 for me. (Pause.)

Q. I just wanted you to look at the steps here 7 and confirm for me that these steps, manually, is what 8 Dr. Hertenstein and his staff were doing when they 9 received claims at Caterpillar. 10 MR. SHEK: Objection; vague and ambiguous. 11 Also calls for speculation. 12 BY MR. SITZMAN: (RESUMED.) 13 Q. You can go ahead and respond. 14 A. And I will have to speculate. 15 Q. Based -- based on whatever you know or 16 learned, is it your belief that that is what they were 17 doing with the claims they received manually? 18 A. Probably on some occasions, yes, but I'm not
6

4 do you see that? 5 A. Uh-huh.

19

19 completely sure.
20
Q. What's causing you to hesitate there? 21 A. Because that has such specificity, I'm not -22 I don't know exactly what their manual method was or

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A. Yes.
Q. Okay. Isn't that the function of Autocoder? MR. SHEK: Objection; vague and ambiguous. BY MR. SITZMAN: (RESUMED.)
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25

23 how whomever was reviewing the claims, be it 24 Dr. Hertenstein or Peggy Saal, prior to CodeReview, 25 how they thought about exactly what they did.
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4
5

6
7 8 9 10
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2 to his question about Autocoder -3 A. Uh-huh. 4 Q. -- is it -- is it your belief, then, that -5 strike that. 6 MR. SITZMAN: Can I get her last question read 7 back to me for -- in response to Mr. Shek's last 8 9 question? TI-IE REPORTER: "Question: Do you know whether 10 or not Autocoder had such a predetermined database?" 11 "Answer: I do not." 12 BY MR. SITZMAN: (RESUMED.) 13

Q. Of CodeReview. And -- but for the fact, then, in responding

14 15 16 17 18 19

Q. Is it clear, though, from your review of Autocoder during that formal demonstration and through your observations that you saw it in use at various customers' facilities or you may -A. I may have seen it.

20
21 23

Q. --haveseenit-A. Uh-huh. Q. -- that it did have the capability or ability
when input by a -- either manually or automatically by

22 to determine whether or not the CPT-4 codes were valid 24 the claims processing? 25 MR. SHEK: Objection; vague and ambiguous.
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entered -A. Uh-huh. Q. -- that Autocoder had a database that consisted of all the valid CPT-4 codes, to check that code against? MR. SHEK: Objection; calls for speculation; incomplete hypothetical. THE WITNESS: I don't know. I would suspect that they probably -- they had some sort of database, but I don't know. I don't know what their system was. BY MR. SITZMAN: (RESUMED.) Q. And I understand Mr. Shek was -- wanted to 14 make sure that you had not seen their code, you've not 15 been given source code; you've not seen their manuals 16 and all of that? 17 A. No. 18 Q. But based on your experience, your expertise, 19 the work you did do on CodeReview, the coding and 20 everything else -21 A. Uh-huh. 22 Q. -- is it at least based on that experience, 23 your belief that there must have been a database from 24 which the Autocoder system could check to see if it 25 was valid or not valid, the CPT-4 code?
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2 3 4 5 6 7 8 9
10 11

BY MR. SITZMAN: (RESUMED.) Q. In other words, going back to the earlier testimony -A. Yes. Q. -- what did you understand the purpose of Autocoder to -- was? A. Autocoder would allow -- as you can expect,

A. I'm making an -- a guess would be, yes, they 2 had to have something in order to compare the input
3 with, to something that told them whether it was a 4 code or not a code, whether it was -- and it more than 5 likely existed in the form of a database, but I don't 6 know. 7 Q. Are there other things that it could have 8 9 10
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physicians are sending in their claim forms; their office staff is typing up these claim forms, and they're not always going to get the code correct. They may send in a claim that doesn't have a code. It may only have language. So, what Autocoder did, was if you typed in a code that was not valid, it would tell you it was invalid. And it would probably ask you to -- can't -- you know, I can't remember, but I do know -- my recollection is that it was limited to getting the code, the individual code for the individual procedure correct.

existed in? You saw --

A. Unfortunately, I -Q. Oh.

I

A. -- I'm probably un -- as limited as you are in terms of what I know, at least now, about computers, which is pretty pathetic since my name's on this 14 patent. But I would never be one to presume that I 15 know the universe of possibility in any field, and I 16 certainly didn't then or now. So, I -- I don't know.
12 13 17 18 19

Q. Okay. A. What I'm saying is, it's most likely that
would be the simple way to have done it.

20
21

Q. Okay. A. So that it matched with an actual CPT-4 code.

20
21

Q. Okay.

Q. Based on your knowledge and your expertise and 22 the work that you did on CodeReview -23 A. Uh-huh. Q. -- is it your belief that in order to 24 25 determine whether or not a valid code had been
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(Pause.) 22 MR. SITZMAN: I'm just going to ask one more 23 other follow-up and then -24 THE WITNESS: Okay. 25 MR. SITZMAN: No. No. No, not of you.
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EXHIBIT E

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EXHIBIT F

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EXPERT REPORT OF RANDALL DAVIS McKesson Information Solutions LLC v. The Trizetto Group, Inc October 24, 2005

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I. INTRODUCTION My name is Randall Davis. I am a Professor of Computer Science at the Massachusetts Institute of Technology. Exhibit A contains a resume providing details of my technical background and experience. I received my undergraduate degree from Dartmouth, graduating summa cum laude, Phi Beta Kappa in 1970, and a Ph.D. from Stanford University in artificial intelligence in 1976. While at Stanford I was a member of the Heuristic Programming Project, the research group that invented expert systems and produced the first such programs, including DENDRAL, a program for chemistry, and MYCIN, the first medical expert system. My PhD thesis work specified some of the foundational concepts in expert systems, including the notions of explanation and knowledge acquisition. I came to MIT in 1978, served for five years as Associate Director of the MIT Artificial Intelligence Laboratory, and currently serve as a Research Director in the newly formed 850person MIT Computer Science and Artificial Intelligence Laboratory. I have published some 55 articles on issues related to artificial intelligence and have served on several editorial boards, including Artificial Intelligence, AI in Engineering, and the MIT Press series in AI. I am a co-author of Knowledge-Based Systems in AI. In recognition of my research in artificial intelligence, I was selected in 1984 as one of America's top 100 scientists under the age of 40 by Science Digest. In 1986 I received the AI Award from the Boston Computer Society for contributions to the field. In 1990 I was named a Founding Fellow of the American Association for AI and in 1995 was elected to a two-year term as President of the Association. In 2003 I received MIT's Frank E. Perkins Award for graduate advising. From 1995­1998 I served on the Scientific Advisory Board of the U. S. Air Force.

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In addition to my work with artificial intelligence, I have also been active in the area of intellectual property and software. Among other things, I have served as a member of the Advisory Board to the US Congressional Office of Technology Assessment study on software and intellectual property, published in 1992 as Finding a Balance: Computer Software, Intellectual Property, and the Challenge of Technological Change. I have published a number of articles on the topic, including co-authoring an article in the Columbia Law Review in 1994 entitled "A Manifest Concerning Legal Protection of Computer Programs" and an article in the Software Law Journal in 1992 entitled "The Nature of Software and its Consequences for Establishing and Evaluating Similarity." From 1998-2000 I served as the chairman of the National Academy of Sciences study on intellectual property rights and the emerging information infrastructure entitled The Digital Dilemma: Intellectual Property in the Information Age, published by the National Academy Press in February, 2000. I have been retained as an expert in over thirty cases dealing with misappropriation of intellectual property, such as the allegations raised in this case. I have been retained by plaintiffs who have asked me to investigate violations of intellectual property, by defendants who have asked me to investigate allegations made against them, and by both sides to serve as the sole arbiter of a binding arbitration. A list of cases in which I have been involved is attached as Exhibit B. In 1990 I served as expert to the Court (Eastern District of NY) in Computer Associates v. Altai, a software copyright infringement case whose decision was upheld by the Appeals Court for the 2nd Circuit in June 1992, resulting in the articulation of the abstraction, filtration, comparison test for software. In the early 1990's I was retained by the Department of Justice for

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its investigation of the INSLAW matter. In 1992 (and later in 1995) my task in that engagement was to investigate alleged copyright theft and subsequent cover-up by the Federal Bureau of Investigation, the National Security Agency, the Drug Enforcement Agency, the United States Customs Service, and the Defense Intelligence Agency. II. OPINION I was retained by The TriZetto Group, Inc. ("TriZetto") on September 19, 2005 and have been asked to perform a detailed analysis of the 5,253,164 patent ("the `164 patent") and any available prior art. The opinions I report here are based on the documents I have reviewed (a full list is given in Exhibit C), and on my knowledge, background, and experience in the field of computer science and artificial intelligence. Based on the prior art cited and discussed in detail below, it is my firm opinion that each and every asserted claim in the `164 patent would have been anticipated by the relevant prior art and obvious at the time of invention to a person having ordinary skill in the art. 1 III. THE '164 PATENT: OVERVIEW The '164 patent has an effective filing date of September 30, 1988. Accordingly, the critical prior art date for purposes of patent invalidity under 35 U.S.C. § 102(b) is September 30, 1987. The '164 patent recites an application of expert systems technology to the processing of medical claims expressed in terms of medical service codes. For the purposes of this case an expert system can be thought of simply as a specific style of computer program: Expert systems are programs designed to do one specific task (in this case reviewing medical claims), using

1

I take a person of ordinary skill in the art to be someone with an undergraduate degree in Computer Science with at least one course in artificial intelligence, and at least one year of experience in building expert systems. McKesson v Trizetto 3

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(typically) a set of rules that specify the knowledge necessary to do that task, and having that set of rules represented in the system in a way that is distinct from the code that examines the rules and applies them to the task. It is this focus on task-specific knowledge (the rules) and their representation distinct from the code that characterizes expert systems as a specific class of computer program. The '164 patent contains both method (1, 2, and 16) and apparatus claims (3-15). I begin by considering the method claims. In each case the analysis below focuses on selected language in the claim. III.A. Method Claims III.A.1. Claim 1 I take t