Free Motion in Limine - District Court of Arizona - Arizona

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Sid Leach (#019519) Monica A. Limón-Wynn (#019174) SNELL & WILMER L.L.P. One Arizona Center 400 E. Van Buren Phoenix, AZ 85004-2202 Telephone: (602) 382-6372 Attorneys for Plaintiff Hypercom Corporation [email protected] [email protected] IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Hypercom Corporation, Plaintiff, vs. Omron Corporation, Defendant. Plaintiff Hypercom Corporation ("Hypercom") moves in limine for an order precluding Omron Corporation ("Omron") from using, introducing, referencing, or presenting at trial the claim-construction order ("Verifone Order") issued in Verifone, Inc. v. Verve, L.L.C, Case No. C 04-02795 WHA (N.D. Cal.) ("Verifone Case") pursuant to Rules 401, 402 and 403. A copy of the Verifone Order is attached hereto as Exhibit 1. USE OF THE CLAIM CONSTRUCTION ORDER WILL UNFAIRLY PREJUDICE HYPERCOM IN THIS ACTION Rule 401 defines relevant evidence as evidence "having any tendency to make the existence of any fact that is of consequence . . . more probable or less probable." Rule 402 provides that evidence that is irrelevant is not admissible. Rule 403 of the Federal Rules of Evidence permits this Court to exclude even relevant evidence if its probative value is "substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by . . . waste of time." In this case, the Verifone Order is properly precluded under Rules 401 and 402 because it offers nothing concerning Omron's state of mind at the time when the lawsuits No. CV 04-0400 PHX PGR HYPERCOM CORPORATION'S MOTION IN LIMINE TO EXCLUDE CLAIM-CONSTRUCTION ORDER IN NORTHERN DISTRICT OF CALIFORNIA CASE NO. C 04-02795

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were commenced against Hypercom. The Verifone Order is irrelevant to the question of probable cause, and similarly irrelevant as to whether Omron had any good faith belief at the time the actions were instituted against Hypercom in September 2003 and in February, July and August 2004. Even if the Verifone Order had any measurable probative value concerning Omron's state of mind as to the continuation of the proceedings, it is marginal at best for several reasons. The Verifone Order concerns U.S. Patent Nos. 4,562,341 ("the `341 Patent") and 4,678,895 ("the `895 Patent"), not the 5,012,077 ("the `077 Patent"). The `077 Patent was the patent at issue in the ITC Action and the California Action, which actions were brought in July 2004 and August 2004, respectively. The `895 Patent was the patent at issue in the Michigan Action, which action was brought against Hypercom in September 2003. Verve dismissed the Michigan Action after Hypercom succeeded in obtaining an order transferring the action from the Eastern District of Michigan to the District of Arizona in June 2004, which is one-year prior to the time that the Verifone Order was entered. As for the Texas Action that Verve brought against Hypercom in February 2004, that action was transferred from the Western District of Texas to the District of Arizona in December 2004. By February 2005, the ALJ in the ITC Action had concluded that Verve lacked all substantial rights in the `077 Patent (which underlying documents include the `341 Patent) and thus lacked standing to file any lawsuits based upon that patent without adding Omron as a party to the action. Second, Hypercom was not a party to the Verifone Case and none of Hypercom's devices or terminals was at issue there. Hypercom, who was not a party to the Verifone Case, did not participate in the litigation and its interests were not represented ­ fairly, adequately, or at all. The plaintiff in the Verifone Case is a competitor of Hypercom. Thus, Hypercom did not have a "full and fair opportunity" to litigate the construction of the `341 Patent (or any other patent for that matter). Furthermore, where the parties to an action enter into a stipulated settlement, a claim construction order was not "essential to a final judgment" on the question of a
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patent's infringement or its validity. Kollmorgen Corp. v. Yaskawa Electric Corp., 147 F. Supp. 2d 464, 467-68 (W.D. Va. 2001) (finding that attaching preclusive effect to a district court order that never underwent the Federal Circuit's rigorous review does not fairly promote or support the Supreme Court's interest in uniformity and consistency). The "lack of any realistic opportunity for Federal Circuit review greatly outweighs the adequacy of the hearing and the nature of the Markman Order." Id. 147 F. Supp. 2d at 469-70. Here, because the parties in the Verifone Case stipulated to dismiss the action only about one month after the Verifone Order was entered, the Verifone Order lacks the requisite level of finality to have proper preclusive effect upon the parties in this action. (See Exhibit 2.) Because the Northern District of California never reached a decision as to the patent infringement claim, the Verifone Order "necessarily could not prove essential to a non-existent final judgment," and thus collateral estoppel should not apply to the facts of this case. See Kollmorgen, 147 F. Supp. 2d at 469-70. For these reasons, issue preclusion is inappropriate in this action and the Court need not defer to the Verifone Order. Hypercom respectfully requests this Court enter an order precluding Omron from using, referencing or presenting at trial any portion of the Verifone Order. A proposed form of Order is attached hereto as Exhibit 3. RESPECTFULLY SUBMITTED 13th day of April, 2007.

SNELL & WILMER L.L.P.

By s/ Monica A. Limón-Wynn Sid Leach Monica A. Limón-Wynn SNELL & WILMER L.L.P. One Arizona Center Phoenix, AZ 85004-2202 Attorneys for Plaintiff Hypercom Corporation

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STATEMENT OF MOVING COUNSEL The undersigned certifies that after personal consultation and sincere efforts to do so, counsel for Hypercom and counsel for Omron have been unable to satisfactorily resolve the matters presented in this motion.

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CERTIFICATE OF SERVICE I hereby certify that on April 13, 2007, I electronically transmitted HYPERCOM CORPORATION'S MOTION IN LIMINE TO EXCLUDE CLAIMCONSTRUCTION ORDER IN NORTHERN DISTRICT OF CALIFORNIA CASE NO. C 04-02795 to the Clerk's Office using the ECF System for filing and transmittal of a Notice of Electronic Filing to the following ECF registrants: David P. Irmscher John K. Henning, IV BAKER & DANIELS 300 N. Meridian Street, Suite 2700 Indianapolis, IN 46204 Phone: 317-237-1317 Fax: 317-237-1000 [email protected] [email protected] Attorneys for Defendant Omron Corporation Paul Moore Ray K. Harris FENNEMORE CRAIG, P.C. 3003 N. Central Avenue, Suite 2600 Phoenix, AZ 85012-2913 Phone: 602-916-5414 Fax: 602-916-5614 [email protected] [email protected] Attorneys for Defendant Omron Corporation s/ Monica A. Limón-Wynn
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A. Colin Wexler Matthew A.C. Zapf GOLDBERG KOHN BELL BLACK ROSENBLOOM & MORITZ, LTD. 55 E. Monroe Street, Ste. 3300 Chicago, IL 60603 Ph. 312-201-4000 Fax: 312-332-2196 [email protected] [email protected] Attorneys for Defendant Omron Corporation H. Michael Clyde Todd R. Kerr PERKINS COIE BROWN & BAIN P.A. 2901 N. Central Ave., Ste. 2000 Phoenix, AZ 85012-2788 Ph.: 602-351-8000 Fax: 602-648-7000 [email protected] [email protected] Attorneys for Defendant Omron Corporation

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