Free Exhibit List - District Court of Arizona - Arizona

Case 2:04-cv-00400-PGR

Document 86-7

Filed 12/23/2005

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UNITED STATES INTERNATIONAL TRADE COMMISSION Washington, D.C.
In the Matter of

CERTAIN POINT OF SALE TERMINALS AND COMPONENTS THEREOF
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Inv. No. 337-TA-524
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ORDER NO. 16: GRANTING IN PART HYPERCOM'S MOTION TO COMPEL
(November 17,2004)
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On October 29, 2004, Respondent Hypercom Corporation ("Hypercom"), filed a mgtion2= (524-014) to compel Complainant to provide full and complete responses, without objection, to Hypercom's first and second set of interrogatories and first set of documentrequests to Complainant. On November 12,2004, Complainant Verve L.L.C. ("Verve" or "Complainant")filed an opposition to the motion.' No other responses were received. Hypercom served Verve with its first set of interrogatories and first set of request for document production on September 7,2004, and its second set of interrogatories on September 24, 2004. Verve responded to these request on September 27,2004 and October 7,2004, respectively. Hypercom states that the responses are deficient because Verve's overbroad and unduly burdensome objections are baseless and that Verve should be compelled to adequately respond. There are five categories of documentsthat Hypercom moves to compel, including: 1) documents regarding Omron Tateisi Electronics Company ("Omron"); 2) claim construction; 3) Complainant's pre-complaint

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Pursuant to Commission Rule 21O.l5(c), responses to motions are due within ten days after service. Hypercom's motion was filed on October 29,2004, and responses were due on November 10,2004. Verve did not file its response until November 12,2004 and was not accompanied by a motion for leave to file its response out of time. Despite the untimeliness, the undersigned will accept Verve's filing due to the recent problems with electronic filing in EDIS.

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Case 2:04-cv-00400-PGR

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investigation; 4) Complainant's domestic industry, including the alleged licensees of rights under the `077 patent; and 5) Complainant's organization attributes and relationship with the Simon, Galasso & Frantz law firm. Omron Documents Hypercom requests a number of documents that involve the relationship between Omron and Verve. Omron is listed as the "Assignee" on the face of the `077 patent and subsequently assigned its interest in the `077 patent to Verve. Verve argues that it is reluctant to disclose information regarding its assignment agreement with Omron based on the confidentiality provisions contained within the agreement without a court order. Verve states that it has sought Omron's permission to divulge the assignment agreement, but that it has not yet received Omron's permission. Verve also states that it does not possess many relevant documents because it only recently acquired the `077 patent. The Commission Rules clearly state that parties may obtain discovery, regarding any matter, not privileged, that is relevant to the claims or defense of any party. 19 C.F.R. 210.27(b). In $ addition, discoverable matter includes not only relevant material, but also includes information that is reasonably calculated to lead to the discovery of admissible evidence. 19 C.F.R. 2 10.27(b). $ The information requested by Hypercom is clearly relevant and Verve should make every attempt to obtain Omron's permission to release that information under the protective order. The letter sent by Verve to Omron, dated November 5,2004, is not sufficient. See Exhibit B to Verve's Opposition. The letter is only a half-hearted attempt to secure Omron's release, with the assumption that Omron does not wish to waive the confidentiality provisions, which provides Verve with the excuse as to why relevant discovery cannot be provided. Verve made no attempt to inform Omron -2-

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of the protective order that is in place in this investigation, which would allay any of Omron's concerns regarding confidentiality. In addition, although Verve states that it does not currently possess certain relevant documents, possession is not the only requirement under Commission Rule 210.30(a)(l). Specifically, Verve has not shown that it does not have possession, custody or control over such documents, which includes the ability to gain possession of such documents through its relationship with the entity that has the documents. Claim Construction Hypercom requests that Verve provide its claim construction analysis. Verve states that it has not yet fully completed its claim construction analysis. Hypercom argues that Verve's failure to complete its claim construction analysis is a violation of Commission Rule 2 10.4(c),which requires, in part, that each pleading, motion or other paper that is submitted to the administrative law judge or Commission has claims, defenses and other legal contentions that are warranted by existing law, and that allegations and other contentions have evidentiary support. A complainant's failure to fully complete its claim construction analysis during discovery does not specifically violate Commission Rule 2 10.4(c).Although a complainant should have a good idea as to what its claim construction is, the complainant is not bound to a certain claim construction early on in the investigation. Verve states that it has provided detailed claim construction to the parties on November 5, 2004.
See Exhibit C to Verve's Opposition. Although Verve is not

compelled to provide its complete claim construction analysis at this time, Verve has a duty to supplement its responses to interrogatories regarding claim construction on an ongoing basis during the investigation.

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Pre-Complaint Investigation Hypercom alleges that Verve did not perform an adequate pre-complaint investigation and requests Verve's basis for alleging that Hypercorn's products infringe the `077 patent. Verve counters that, on November 5, 2004, it provided additional information on the testing of Respondents' products before filing the Complaint. See Exhibit C to Verve's Opposition. Therefore, it appears that this issue is moot. Domestic Industry - Licensing. Agreements Hypercom has requested various licensing information from Verve because Verve is relying on its licensing activities to fulfil the domestic industry requirement of Section 337. Verve states that it cannot produce the licensing agreements because they are subject to confidentiality agreements, similar to its argument above, regarding the assignment agreement with Omron. Once again, the requested documents are highly relevant to this investigation. Verve should make every attempt to obtain the permission of the third parties to release the information under the protective order. Release of such information is in Verve's best interest. It is hard to fathom how Verve will bear the burden of proving there is a domestic industry without production of the licensing agreements. Organization Hypercom has requested numerous corporate records from Verve, including agreements and

im payments made to the Simon, Galasso & Frantz law fr ("the SGF law firm"). Verve argues that
it has provided all requested information based on its response to Order No. 9. It is unclear that Verve has fully responded to all of Hypercom's discovery requests through its response to Order No.

9; therefore, Verve is compelled to provide complete responses to Hypercom's discovery requests
regarding this category of discovery.
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Accordingly, Hypercom's motion (524-014) is hereby granted in part to the extent detailed above. Complainant is compelled to produce adequate responses to Hypercorn's discovery requests within ten days from the date of this order.

SO ORDERED.

Charles E. Bullock Administrative Law Judge

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Case 2:04-cv-00400-PGR

Document 86-7

Filed 12/23/2005

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