Opposition Brief — Anascape, Ltd. v. Nintendo of America, Inc.

Supreme Coun, US ]

FILED

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[WZ (2) | SEP 24 2619

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No. 10-301 OFFICE OF THE CLERK

IN THE

Supreme Court of the United States

ANASCAPE, LTD.,

Petitioner,

Vv.

NINTENDO OF AMERICA ING.,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

BRIEF IN OPPOSITION

ROBERT J. GUNTHER, JR. WILLIAM F. LEE

WILMER CUTLER PICKERING Counsel of Record

HALE AND DORR LLP MARK C. FLEMING

399 Park Avenue LAUREN B. FLETCHER

New York, NY 10022 WILMER CUTLER PICKERING

(212) 230-8800 HALE AND DORR LLP

60 State Street

Boston, MA 02109

(617) 526-6000

william.lee@wilmerhale.com

|

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QUESTION PRESENTED

Whether a court of appeals reviewing a denial of a

motion for judgment as a matter of law under Rule 50

of the Federal Rules of Civil Procedure may determine

that expert testimony, like any other testimony, does

not provide substantial evidence supporting a jury ver-

dict.

(i)

CORPORATE DISCLOSURE STATEMENT

Pursuant to this Court’s Rule 29.6, Respondent

Nintendo of America Ine. states that its parent corpo-

ration is Nintendo Company, Ltd. The stock of Nin-

tendo Company, Ltd. is publicly traded in Japan.

(11)

TABLE OF CONTENTS

Page

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B. Proceedings In The District Court..................... 6

C. Proceedings In The Court Of Appeals............... 8

REASONS FOR DENYING THE PETITION.......... 11

I. THIS COURT HAS REPEATEDLY RECOG-

NIZED THAT ADMITTED EXPERT TESTI-

MONY MAY BE INSUFFICIENT TO SUPPORT

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III. ANASCAPE’S REMAINING ARGUMENTS

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(111)

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TABLE OF AUTHORITIES

CASES

Page(s)

Alevromagiros v. Hechinger Co., 993 F.2d 417

Ry ER a AER NA Net PEN See 16

Anascape Ltd. v. Microsoft Corp., No. 9:06-CV-

158, 2008 WL 160546 (E.D. Tex. Jan. 11,

PE isis sucealdiclaniennsimdanadiachigiiaanbesisbiaemennsssmoaeddoaxseceees 6

Ariad Pharmaceuticals, Inc. v. Eli Lilly & Co.,

BUS F.3d 1S36 (Wed. Cir. ZOIO) .ovcccccseccsvescsccsssosccvssesss 1]

Bailey v. Allgas, Inc., 284 F.3d 1237 (11th Cir.

EE sentence biiienisuitadindedaccreticcale Noite espeinaices st 15

Brock v. Merrell Dow Pharmaceuticals, Inc.,

Ee © ee re Ce Gr RD wick cekawhscccsttnelashcnkhaesesedees 13

Brooke Group Ltd. v. Brown & Williamson To-

bacco Corp., 509 U.S. 209 (1998)......... 1,11, 12, 14, 22

C.B. Fleet Co. v. SmithKline Beecham Con-

sumer Healthcare, L.P., 131 F.3d 480 (4th

FIs IE Pbaiesscissicssiatan cescncaatcesniain aioe tata os 18

Calhoun v. Honda Motor Co., 738 F.2d 126 (6th

RPE, BON i ibaiiisnsnccdauincninseansninsthishadadsaniseedaaieeaksaaibines 16

Christopher v. Cutter Laboratories, 53 F.3d

Re ee ts BI Piiitieaicatadincacinanetddedetn is daviecccninlas 17

Daubert v. Merrell Dow Pharmaceuticals, Inc.,

I Sr elis UW IED nscttnnsancencsaniceseceessucasdseinasusbiiens 12,13

Gemtron Corp. v. Saint-Gobain Corp., 572 F.3d

1371 (Fed. Cir. 2009), cert. denied, 130 S.

Ae Ris aibiictactcnccevancctantuuessth imac naeauieiipiertanietns 14

General Electric Co. v. Joiner, 522 U.S. 136

EPNUUITE scicasptiac pssisicscabinstrasleaicklaihasnagiha edateaiuaceuienaigabdickieddes eemanaeaec 20

Vv

TABLE OF AUTHORITIES—Continued

Page(s)

Guinn v. AstraZeneca Pharmaceuticals LP,

GOS F'.SG 13466 CLIC Cie. BOD) vcssccccsececccccsosesvessenacns 16

In re Baby Food Antitrust Litigation, 166 F.3d

SAF (Ee CAP. TOG) vcivisrscnisioseserscicinceamaaaaee 15

In re Citric Acid Litigation, 191 F.3d 1090 (9th

COED, FE sscvcesicnicscesstcseecuacoecotaccaneicceiuaaaaaneenanaen 15

In re Joint Kastern & Southern District Asbes-

tos Litigation, 52 F.3d 1124 (2d Cir. 1995).............. 19

Kinser v. Gehl Co., 184 F.3d 1259 (10th Cir.

BGO) vicciccascssicocicvexsecncoteséutasnsneei ae 17

Lockwood v. American Airlines, Inc., 107 F.3d

1566 CF OG. CaP. FORT F iccisscscoxssencecseecceeneaee 5

Marbled Murrelet v. Babbitt, 88 F.3d 1060 (9th

CORP. BEG) vssccc cis arcncindnctiliacsvabwusoussanseraraas ae 18

Matsushita Electric Industrial Co. v. Zenith

Radio Corp., 475 U.S. 574 (1986).............eeeeeeeee 12, 14

Pace v. Capobianco, 283 F.3d 1275 (11th Cir.

SIIEE) sinsiccccsicesvissesieecsnipomerentenda ee eee 16

PowerOasis, Inc. v. T-Mobile USA, Inc.,

622 F'.30 1299 (Fed. Cir. ZOOB) ......ccscccsrcsscsescecsecseses 4,9

Questar Pipeline Co. v. Grynberg, 201 F.3d

Be CRORE CA, Be iicsksccstisassacassacsassantemedtananaeae 17

Rebel Oil Co. v. Atlantic Richfield Co., 51 F.3d

1423 Cth UP. TS icncnncnanennn 15, 16

Reeves v. Sanderson Plumbing Products, Inc.,

GSO 1.3. FEB Ge) sistissiscascecssete are 19, 20, 22

vl

TABLE OF AUTHORITIES—Continued

Page(s)

SCFC ILC, Inc. v. Visa USA, Inc., 36 F.3d 958

BED ccsvssseneccssssccnvssnsveresosnesccnnsszesscscncssesescoss 16

Sundance, Inc. v. DeMonte Fabricating Ltd.,

550 F.3d 1356 (ed. Cir, 2008) ..........cccccccceseeeeeseeeeeees 1]

Turpin v. Merrell Dow Pharmaceuticals, Inc.,

DJOFE’.2G 1349 (6th Cir. 19BZ) .........ccscrccsccccssssesesecees 13

United States v. City of Miami, 115 F.3d 870

TT nas cccccncavensheevncsaseonnnsescosnesonensosasevenincss 15

United States v. Gaskin, 364 F.3d 488 (2d Cir.

isc ca ns cans ddescececandonesensnssstsebeseeosseseness 18

Virgin Atlantic Airways Lid. v. British Air-

ways Ple, 257 F.3d 256 (2d Cir. 2001)..................00. L5

Vollrath Co. v. Sammi Corp., 9 F.8d 1455 (9th

Taro coe csccshevcestceendcesborsnosecnenscessenenensanenneseassis 16

Washington v. United States, 214 F.2d 33 (9th

MTRMEMED «cc cccaconeconcevascseccccsvscovonssceveceanccesscccesonccnsccesens 16

Waterman v. Batton, 393 F.3d 471 (4th Cir.

Nee sas ssacaapcthsennavnsdurevebectossbonedsesaenes 15

Weisgram v. Marley Co., 528 U.S. 440 (2000)......... 17, 2]

STATUTES AND RULES

35 U.S.C.

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TABLE OF AUTHORITIES—Continued

Pagel

OTHER AUTHORITIES

Manual of Patent EHxamining and Procedure

(Sth rev. ed. 2010)

§ 201.07 :

§ 201.11 l

IN THE

Supreme Court of the United States

No. 10-30]

Petitioney

NINTENDO OF AMERICA IN

hee noni nil

/

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

BRIEF IN OPPOSITION

INTRODUCTION

“When an expert opinion is not supported by suffi

cient facts to validate it in the eyes of the law, or when

indisputable record facts contradict or otherwise ren

der the opinion unreasonable, it cannot support a jury’:

verdict.” Brooke Group Ltd. v. Brown & Williamson

Tobacco Corp., 509 U.S. 209, 242 (1993). In this case,

the Federal Circuit concluded that indisputable record

facts—the specifications of the two patents at issue

did not permit a reasonable jury to rule in favor of

Anascape and accordingly directed judgment as a mat

ter of law under Rule 50 of the Federal Rules of Civil

Procedure. Anascape asserts error based solely on the

ya

fact that Anascape’s expert gave conclusory testimony

that, on its face, matched Anascape’s litigation posi

tion--even though the Federal Circuit ruled that the

testimony was “not supported by any evidence at all,

and cannot override the objective content of the pat-

ent documents. Pet. App. 14.

Anascape’s vaunted “circuit split” is in fact a phan

tom. Anasecape did not mention any split in its petition

for rehearing below, and it identifies no decision ac

knowledging any disagreement regarding the applica

tion of Rule 50. Numerous decisions in the very circuits

Anascape identifies grant summary judgment of «dy

ment as a matter of law in the face of expert testimony

that, while admissible under Federal Rule of Evidence

702, is insufficient to support a jury verdict. The cases

Anasecape cites are distinguishable and, moreover, do

not purport to differ from the approach of any other

circuit, let alone from this Court’s approach in Brooke

Group. ‘The fact that expert testimony satisfies the

threshold requirements for admissibility under I’edera!

Rule of Evidence 702 is not a reason to exempt it from

the ordinary operation of Rule 50. The Federal Cir

cuit’s decision is nothing but a factbound—and cor

rect—application of settled Rule 50 doctrine to the par

ticular evidentiary record in this case.

STATEMENT

A. Factual Background

Nintendo is a leading manufacturer of video game

systems, including video game controllers. Anuascupe, a

company that makes no products and does not compete

in the video game market, sued Nintendo for patent in

frinzement in the U.S. District Court for the HKastern

District of Texas, accusing yame controllers for two of

3

Nintendo’s innovative video game systems, the

yameCube and the Wii.

A video game controller operates by converting

“the movement of the user’s hand or finger into an elec-

trical impulse that controls the image on a display, such

as a screen.” Pet. App. 25. Controllers typically em-

ploy one or more “input members,” such as a joystick,

handle, trackball, buttons, or other elements that per-

mit the controller to sense the user’s hand actions,

which are in turn translated electronically into linear

and rotational movements on the screen. /d. at 2-3.

Hand inputs can move images in any of six “degrees of

freedom” (DOF): along three linear axes (for-

ward/backward, left/right, or up/down) and around

three rotational axes (roll, pitch, or yaw). /d. at 3.

Two U.S. patents are relevant here. U.S. Patent

No. 6,222,525, which issued from an application filed on

July 5, 1996 (the ’525 patent), was filed by Anascape’s

founder, Brad Armstrong. In an order Anascape did

not appeal, the district court construed the asserted

claims of the ’525 patent in a way that precluded a find-

ing of infringement. Pet. App. 18 & n.3. Accordingly,

the parties stipulated that the accused Nintendo con-

trollers do not infringe the ’525 patent. Jd.

The second patent at issue resulted from an appli-

cation filed after Mr. Armstrong founded Anascape, a

company formed to license, enforce, or otherwise

monetize Mr. Armstrong’s patents and patent applica-

tions. C.A.J.A. 4372, 6815. In August 2000, after

searching for information about Nintendo’s forthcoming

GameCube product, Mr. Armstrong learned that the

GameCube controller would have multiple input mem-

bers—two joysticks and a_ four-pointed “cross

4

switch’—none of which would be movable in all six

DOF. 7d. at 8713-8716.

On November 16, 2000, Mr. Armstrong filed a “con-

tinuation-in-part” application of the ’525 patent; the ap-

plication eventually issued as U.S. Patent No. 6,906,700

(the ’700 patent).' The ’700 patent claimed controllers

with multiple input members that together operate in

six degrees of freedom. Pet. App. 5. As construed by

the district court, the asserted claims of the ’700 patent

were not limited to a single input member operable in

six degrees of freedom. Id. at 4; C.A.J.A. 44-50.

Anascape conceded below that controllers with

multiple input members were sold or otherwise known

in the art prior to the filing of the ’700 patent, including

a Sony controller sold in 1998, a patent application pub-

lished in 1998, and a second Sony controller sold in Oc-

tober 2000. Pet. App. 4; see 35 U.S.C. § 102(a), (z)(2).

Anascape also conceded that the prior art invalidated

the ’700 patent claims unless the claims were entitled to

the ’525 patent’s earlier priority date of July 5, 1996.

Pet. App. 4.

' Mr. Armstrong later improperly changed the application’s

designation to a “continuation” application. In a continuation ap-

plication, “the disclosure presented in the continuation must be the

same as that of the original application.” Manual of Patent Exam-

ining and Procedure § 201.07 (8th rev. ed. 2010). A continuation-

in-part, by contrast, may include new matter not contained in the

parent application, but claims to that new matter will not be enti-

tled to the earlier filing date. Jd. § 201.11; PowerOasis, Inc. v. T-

Mobile USA, Inc., 522 F.3d 1299, 1306 (Fed. Cir. 2008). As is dis-

cussed below, the disclosure of the ’700 patent differed signifi-

cantly from that of the ’525 patent, so its proper designation was as

a continuation-in-part. Pet. App. 11 & n.2.

5

In order for a patent application to be entitled to

the priority date of an earlier application, the earlier

application, as originally filed, must contain a written

description of the invention that supports the claims of

the later application ““‘in sufficient detail that one

skilled in the art can clearly conclude that the inventor

invented the claimed invention as of the filing date

sought.’”” Pet. App. 4 (quoting Lockwood v. American

Airlines, Inc., 107 F.3d 1565, 1572 (Fed. Cir. 1997)); see

also 35 U.S.C. § 120. In this case, the question of prior-

ity turned on whether the ’525 patent sufficiently de-

scribed the “full scope of the inventions recited in each

asserted claim of the ’700 patent.” Pet. App. 4-5, 29.

All of the claims in the ’525 patent as originally filed

recite a single input member, not multiple input mem-

bers. Pet. App. 5. As Nintendo pointed out below—

and Anascape’s petition for certiorari does not deny—

the ’525 specification contains “over twenty explicit

statements that the invention is directed to a single in-

put member that is operable in six degrees of freedom.”

Id. at 8. The ’525 patent’s drawings “all show a single

input member ... capable of operating in six degrees of

freedom.” /d. at 7. The ’525 patent also disparaged a

prior patent with multiple input members (U.S. Patent

No. 5,298,919 to Chang), stating that “the lack of a hand

operable single input member operable in six degrees

of freedom has many significant disadvantages.” /d. at

9 (quoting ’525 patent, col. 3, 1. 30 to col. 4, 1. 380).

In preparing the application for the ’700 patent, Mr.

Armstrong removed important disclaimers and limita

tions from the ’525 patent and added significant broad-

ening language. Every occurrence of the phrase “hand

operable single input member” was replaced with

“hand operable input member(s),” and 16 of 17 refer-

ences to “single input member” were changed to “at

6

least One input member.” Pet. App. 11-12. Mr. Arm-

strong also deleted the ’525 patent’s criticism of the

Chang patent and its use of multiple input members.

Id. at 12.

B. Proceedings In The District Court

In a pretrial claim construction order, the U.S. Dis-

trict Court for the Eastern District of Texas recognized

that the inventor of the 7525 patent “clearly expected

the inventions to be used with a single input member

(such as a joystick) that moved in 6 DOF to control an

image appearing to move in three dimensions.” Pet.

App. 5 (quoting 2008 WL 160546, at *8) (emphasis

added). Nonetheless, Anascape argued that the ’525

patent sufficiently described the devices with multiple

input members later claimed in the ’700 patent.

Anaseape based its argument on the testimony of

its expert witness, Dr. Robert Howe. At trial, Dr.

Howe testified that a statement in the 525 patent that

“(t]he input member of the joystick-type controller may

be manipulable or operable in wp to 6 degrees of free-

dom” meant that “it could be less” than six degrees.

Pet. App. 57-58. He also testified that Figure 9 of the

625 patent showed “a lot of different input modes.” /d.

at 59. Dr. Howe also referred to other “words” and

“text” in the 525 patent that, he contended, meant that

“you could interpret or sense the motion on all 6 de-

grees of freedom there, but you don’t have to.” Jd. at

61-62. Dr. Howe’s overall conclusion was that the ’525

patent “talks about many ideas,” that “the material in

the patent is broader than a single input 6-degree-of-

freedom device,” and that “this supports the claims ...

from the ’700 patent.” Jd. at 54-55.

7

Dr. Howe’s direct testimony did not address the

multiple instances of broadening language and dele-

tions of limitations that differentiate the disclosure of

the ’700 patent from that of the 525 patent. And he

admitted on cross-examination that he did not address

the 525 patent’s disparagement of the Chang refer-

ence, which employed multiple input members. See

C.A.J.A. 4693. Dr. Howe also admitted that the ’525

patent does not disclose the feature—claimed in the

"700 patent—of combining three or more input mem-

bers to achieve control in six DOF:

Q. Just to confirm, though, you can’t point to

anything in the 1996 application where there’s

three input members that can each be touched

by the user and each be moved bi-directionally

to provide 6 degrees of freedom, can you?

A. No.

Id.

At the close of Anascape’s case, Nintendo moved

for judgment as a matter of law under Rule 50, con-

tending that there was “no legally sufficient eviden-

tiary basis for a reasonable jury to find for Anascape on

the issue of priority/earlier effective filing date.” Def.

Nintendo of Am.’s Mot. for Judgment as a Matter of

Law 9 (Dkt. 316) (May 9, 2008).

At the close of all evidence, Nintendo renewed its

Rule 50 motion, pointing out in detail that every em-

bodiment disclosed in the 7525 patent involved a single

input member movable in six DOF, that the ’525 patent

disparaged the Chang reference for its use of multiple

input members, and that no reasonable jury could find

that the 525 patent supported the claims of the ’700

patent. Def. Nintendo of Am.’s Mot. for Judgment as a

8

Matter of Law 9-12 (Dkt. 317) (May 13, 2008). The dis-

trict court denied the motion, ruling that Dr. Howe’s

testimony was “sufficient evidence for this to go to a

jury.” Trial Tr. 1523-1524 (May 138, 2008).

The jury found that three of Nintendo’s four ac-

cused controllers infringed the ”700 patent and awarded

$21 million in damages. Pet. App. 26. Nintendo re-

newed its motion for judgment as a matter of law and,

in the alternative, sought a new trial. Among other ar-

guments, Nintendo pointed out Dr. Howe’s admission

that the ’525 patent failed to support the full breadth of

the ’700 patent claims. See Def. Nintendo of Am.’s Re-

newed Mot. for Judgment as a Matter of Law or, in the

Alternative, a New Trial 9 (Dkt. 356) (July 2, 2008).

The district court denied the motion, ruling that Dr.

Howe had “provided extensive testimony” about how

the ’525 patent specification supported the asserted

claims in the ’700 patent. Pet. App. 29-30.?

C. Proceedings In The Court Of Appeals

The U.S. Court of Appeals for the Federal Circuit

reversed, concluding that “a reasonable jury would not

have a legally sufficient evidentiary basis to find” that

the ’525 patent sufficiently described the invention

claimed in the ’700 patent. Pet. App. 19 (internal quota-

tion marks omitted).

* The district court also ruled that testimony of Nintendo en

gineer Kazunori Koshiishi supported the jury’s verdict. Pet. App.

30-31. The Federal Circuit ruled that Anascape’s argument in this

regard rested on “a misstatement of Mr. Koshiishi’s testimony.”

Pet. App. 15. Anascape does not challenge that ruling in its peti-

tion for certiorari. Dr. Howe’s testimony rested in part on

Anascape’s misapprehension of Mr. Koshiishi’s testimony.

C.A.J.A. 4684.

9

The Federal Circuit carefully analyzed the objec-

tive evidence of record. First, the court noted the nu-

merous instances in which the 525 patent described the

invention as a device with a “single input member”

movable in six DOF. Pet. App. 6. The court also re-

jected Anascape’s argument based on the figures in the

625 patent, because the specification itself and the in-

ventor’s testimony confirmed that each of the figures

showed a single input member operating in 6 DOF. /d.

at 7-8. Similarly, the court observed that the sentence

in the ’525 patent stating that a joystick “may be” oper-

able in 6 DOF—on which Dr. Howe relied at trial

not a description of the ’525 invention; it is a description

of prior art joysticks as generally used in video games.

Id. at 8. The Federal Circuit separately noted the ’525

patent’s disparagement of the Chang reference for its

use of multiple input controllers. Jd. at 8-9. The Fed-

eral Circuit also rejected Anascape’s efforts to rely on

material in the 525 specification that was added in Au-

gust 2000, long after the original application was filed.

Id. _ 10 (citing PowerOasis, Inc. v. T-Mobile USA,

Inc., 522 F.3d 1299, 13806 (Fed. Cir. 2008)).

The Federal Circuit then itemized the numerous

ways in which Mr. Armstrong had modified the ’525

specification in preparing the later application that be-

came the ’700 patent. Pet. App. 11-12. Mr. Armstrong

replaced references to a “single input member” with

references to “at least one input member” and “deleted

all mention of the prior art Chang controller and its de-

ficiencies.” Jd. at 12. These changes were “extensive

and substantive” and gave the ’700 patent “commensu-

rately broadened scope.” /d. at 13.

The Federal Circuit found Anascape’s argument

that the 525 patent “did not disclaim the broader scope

of the ’700 claims” to be off-point, because “the question

10

is whether the ’525 specification sufficiently describes

the later-claimed subject matter.” Pet. App. 13 (em-

phasis added). As the court noted, a patentee is not

“presumed to support variants that are not described.”

Id. at 14.

The Federal Circuit then ruled that Dr. Howe’s

evidence “cannot override the objective content of

these documents,” namely the ’525 and ’700 patents,

noting that his conclusion that the ’525 patent sup-

ported the ’700 patent claiins was “not supported by

any evidence at all.” Pet. App. 14. The court concluded

that “the only reasonable reading of the ’525 specifica-

tion is that it is directed to and describes only a control-

ler having a single input member operable in six de-

grees of freedom.” /d. at 17. As a result, the ’700 pat-

ent claims were not entitled to an earlier priority date

and—by Anascape’s concession—were invalidated by

prior art. The Court ruled that “judgment as a matter

of law is appropriate” and reversed the district court’s

denial of Nintendo’s Rule 50 motion. /d. at 19.

Anascape petitioned fer panel rehearing and re-

hearing en bane. Anascape’s request for panel rehear-

ing asserted that the panel had “declined to consider

Dr. Howe’s analysis” and argued that the panel should

have “deferr[ed] to record expert evidence.” Pet. for

Reh’g 6. Anascape urged the panel to rehear the case

to consider the expert evidence under the standard “re-

quired by the law of the regional circuit (here, the Fifth

Circuit).” Jd. at 7. Anascape did not suggest that the

Fifth Circuit’s approach to the treatment of expert tes-

3 _

Judge Gajarsa filed a separate concurrence that does not

bear on the issue presented in Anascape’s petition for certiorari.

Pet. App. 20-23.

1]

timony on a Rule 50 motion was incorrect, nor did it

suggest that the Fifth Circuit’s approach conflicted

with that of other circuits. Anascape’s petition did not

seek a remand for a new trial or indicate that it could

have proffered any additional evidence to avoid judg.

ment as a matter of law."

The Federal Circuit denied rehearing and rehear-

ing en bane. Anascape petitioned for certiorari.

REASONS FOR DENYING THE PETITION

I THIS COURT HAS REPEATEDLY RECOGNIZED THAT

ADMITTED EXPERT TESTIMONY MAY BE INSUFFICIENT

TO SUPPORT A VERDICT

This Court has engaged in the very reasoning for

which Anascape faults the Federal Circuit here. In

Brooke Group Ltd. v. Brown & Williamson Tobacco

Corp., 509 U.S. 209 (1993), a jury had found that re-

spondent Brown & Williamson “had engaged in price

discrimination that had a reasonable possibility of injur-

ing competition in the domestic cigarette market as a

whole.” /d. at 218. The Court acknowledged that peti-

tioner Liggett had proffered an economic expert who

“explained Liggett’s theory of predatory price dis-

crimination and testified that he believed it created a

reasonable possibility that Brown & Williamson could

injure competition in the Umted States cigarette mar-

ket as a whole.” /d. at 242. The Court nonetheless af-

firmed the grant of judgment as a matter of law, ruling

Anascape also sought rehearing en banc on the theory that

the panel’s decision conflicted with the Federal Circuit’s decisions

in Ariad Pharmaceuticals, Inc. v. Ela Lilly & Co., 598 F.3d 1336

(Fed. Cir. 2010) (en bane), and Sundance, Inc. v. DeMonte Favbri-

cating Ltd., 550 F.3d 1356 (Fed. Cir. 2008).

12

that the record “does not provide an adequate basis for

a finding of liability.” /d. at 230. The Court explained

the insufficiency of the expert testimony as follows:

When an expert opinion is not supported by

sufficient facts to validate it in the eyes of the

law, or when indisputable record facts contra-

dict or otherwise render the opinion unreason-

able, it cannot support a jury’s verdict. Expert

testimony is useful as a guide to interpreting

market facts, but it is not a substitute for them.

Id. at 242 (citation omitted).

In support, the Court cited and reaffirmed similar

reasoning in Matsushita Electric Industrial Co. v. Ze-

nith Radio Corp., 475 U.S. 574 (1986). There, the Court

accepted as final a determination that the plaintiffs’ ex-

pert evidence was admissible. /d. at 580. Nonetheless,

the Court affirmed the district court’s conclusion tha

the report was “implausible and inconsistent with re

cord evidence,” had “little probative value,” and accord-

ingly could not overcome summary judgment. /d. at

594 n.19 (cited in Brooke Group, 509 U.S. at 242).

Furthermore, in Daubert v. Merrell Dow Pharma-

ceuticals, Inc., 509 U.S. 579 (1998)—decided only a

week after Brooke Group—this Court took pains to

emphasize the difference between a determination that

expert testimony is admissible and a determination

that it suffices to support a reasonable jury verdict.

Responding to the concern that Daubert’s more per-

missive approach to admission of expert evidence might

“result in a ‘free-for-all’ in which befuddled juries are

confounded by absurd and irrational pseudoscientific

assertions,” this Court reaffirmed the authority of fed-

eral courts to resolve cases as a matter of law under

ls

Rule 50, even in the face of admissible expert testi

mony:

[I]n the event the trial court concludes that the

scintilla of evidence presented supporting a po

sition is insufficient to allow a reasonable juror

to conclude that the position more likely than

not is true, the court remains free to direct a

judgment, F'ed.Rule Civ.Proc. 50(a), and like

wise to grant summary judgment, Fed.Rule

Civ.Proc. 56.

Daubert, 509 U.S. at 595-596. The Court cited with ap

proval two cases that had ruled, as a matter of law, that

admitted expert testimony was insufficient to support a

jury verdict. See id. at 596 (citing Turpin v. Merrell

Dow Pharms., Inc., 959 F.2d 1349 (6th Cir. 1992), and

Brock v. Merrell Dow Pharms., Inc., 874 F.2d 307 (5th

Cir. 1989)).°

The Federal Circuit’s analysis of Dr. Howe’s testi

mony was no different from this Court’s analysis of

similar testimony in Brooke Group and Matsushita.

Just as this Court rejected expert testimony that had

“little probative value in comparison with the economic

: Although the Sixth Circuit’s decision in Turpin ruled in the

alternative that expert testimony was inadmissible (see 959 F.2d

at 1360), its primary conclusion was one of insufficiency of the evi

dence. See id. at 1350 (“Taken in the light most favorable to the

plaintiffs, the scientific evidence that provides the foundation for

the expert opinion on causation in this case is not sufficient to al

low a jury to find that it is more probable than not that Bendectin

caused the minor plaintiff's injury.”); see also Daubert, 509 U.S. at

596 (summarizing Turpin as “holding that scientific evidence that

provided foundation for expert testimony, viewed in the light most

favorable to plaintiffs, was not sufficient to allow a jury to find it

more probable than not that defendant caused plaintiff's injury’’).

14

factors” in the record, Matsushita, 475 U.S. at 594 n.19;

see also Brooke Group, 509 U.S. at 243, the Federal

Circuit rejected expert testimony that sought to “over-

ride the objective content of’ the two patent specifica-

tions at issue (Pet. App. 14). The Federal Circuit did

not make any credibility determinations or weigh the

evidence, any more’ than this Court had; rather, it sim-

ply concluded under accepted Rule 50 standards that

Dr. Howe’s opinion was incapable of supporting a jury

verdict. Anascape’s contrary account of the Federal

Circuit’s opinion is indistinguishable from the position

that Justice White expressed in dissent—a_ position

that this Court rejected in Matsushita and again in

Brooke Group. See Matsushita, 475 U.S. at 606 (White,

J., dissenting) (contending that the weaknesses in

plaintiffs’ expert’s analysis were “arguments that a

factfinder should consider’’).

I]. THERE IS NO CIRCUIT SPLIT

In its petition for rehearing below, Anascape ac-

cused the Federal Circuit of misapplying the rulings of

the Fifth Circuit, which is the regional circuit govern-

ing non-patent issues in this patent case. Pet. for Reh’g

7; see Gemtron Corp. v. Saint-Gobain Corp., 572 F.3d

1371, 13879 (l’ed. Cir. 2009) (Federal Circuit reviews de-

nials of Rule 50 motions under the law of the regional

circuit), cert. denied, 130 S. Ct. 1739 (2010). Reversing

course, Anascape now contends that the Federal Cir-

cuit correctly applied Fifth Circuit law, but that the

Federal and Fifth Circuits’ approach to Rule 50 pre-

sents a “sharp contrast” to that of other circuits, impli-

cating a “longstanding and entrenched” circuit conflict.

Pet. 12, 16. Anascape did not identify any such conflict

in its petition for rehearing below, and for good reason:

none exists.

Ll)

Anascape identifies no court of appeals decision a

knowledging its perceived circuit split. On the con

trary, numerous courts of appeals, including those cu

cuits Anascape invokes, have followed this Court’

analysis in Matsushita and Brooke Group by directing

summary judgment or judgment as a matter of law

notwithstanding expert testimony that, though adm)

sible, is deemed insufficient to support a jury verdict

See, e.g., Waterman v. Batton, 393 F.3d 471, 478 & n&

(4th Cir. 2005) (reversing denial of summary judgment

where the record showed that officers’ conduct wa

reasonable, notwithstanding expert testimony to the

contrary); Bailey v. Allgas, Inc., 254 F.3d 1287, 1257

(lith Cir. 2002) (‘Regardless of whether the testimony

of the Baileys’ expert is admissible, we conclude the

testimony is insufficient to establish a violation of the

Robinson-Patman Act.”); Virgin Atl. Arrways Ltd

British Arrways Ple, 257 F.3d 256, 267-268 (2d On

2001) (affirming grant of summary judgment notwith

standing expert testimony, citing Ksrooke Group); In re

Citric Acid Latig., 191 F.8d 1090, 1102 (9th Cir. 1999)

(“Because there is no evidence in the record establish

ing that Cargill’s market share was constant betwee!

1993 and 1995, any inference founded upon that factual

assertion—even one drawn by an economic expert—1

necessarily unrea wnable.” (citing Brooke Group) (foot

note omitted)); In re Baby Food Antitrust Litig., 166

I3d 112, 135 (3d Cir. 1999) (affirming summary judg

ment where expert opinion, even “assuminy [its] ad

missibility,” offered “meayer evidence of defendant

behavior contrary to self interest and of motivation to

conspire”); United States v. City of Miami, 115 F.3d

870, $73 (Lith Cir. 1997) (directing dissolution of con

sent decree where city’s expert testimony “lacked pro

bative value as a matter of law”); Peebel Oil Co. v. Al

lf)

lantic Richfield Co., 51 F.8d 1421, 1486 (9th Cir. 1095)

(“Our independent review of Rebel’s expert affidavits

compels the conclusion that it would be unreasonable

for a juror to infer from those affidavits that full serve

sales of gasoline should be excluded from the relevant

market.”); SCRC ILC, Inc. v. Visa USA, Inc., 36 F.3d

958, 969 (Oth Cir. 1994) (reversing denial of Rule 50

motion where “the evidence cited by the district court”

in support of the jury verdict, including expert testi

mony, “is insufficient as a matter of law”); Vollrath Co

9 id 1455, 1462 (9th Cir. 1998) Caf

firming grant of judgment notwithstanding the verdict

where plaintiffs “expert testimony was not based upon

v. Sami Corp

sufficient evidence adduced at trial’); Alevromagiros v

Hechinger Co., 998 F.2d 417, 422 (4th Cir. 1998) Caffirm

ing directed verdict where expert testimony was “un

supported by any evidence”); Calhoun v. Honda Motor

Co., 738 F.2d 126, 131 (6th Cir. 1984) (affirming grant of

judgment notwithstanding the verdict where

“lalithough plaintiffs expert opined that the brakes

were wet at the time of the accident, the evidence does

not support his conclusion’); Washington v. United

States, 214 F.2d 33, 43 (9th Cir. 1954) (affirming di

rected verdict, ruling that opinion testimony, including

expert opinion, “without any support in the demonstra

tion and physical facts, is nol substantial evidence”); see

also Guinn v. AstraZeneca Pharms. LI’, 602 F.3d 1245,

1256-1257 (lith Cir. 2010) (affirmings summary judy

ment where, even if expert testimony had been admis

sible, it would not have permitted a reasonable juror to

,

rule in plaintiffs favor); Pace v. Capobianco, 243 F.3d

127, 1241 nil (Lith Cir. 2002) (Opinions, be they ex

pert or lay, are only as yood as the evidence upon which

they are based.’’).

7

The decisions Anascape cites do not suggest any

meaningful disagreement either. Kinser v. Gehl Co.,

184 F.3d 1259 (10th Cir. 1999), was abrogated by this

Court’s decision in Weisgram v. Marley Co., 528 U.S.

440 (2000), which ruled (contrary to Kinser) that an ap-

pellate court may direct judgment for a verdict loser in

a case where “the appellate court declares inadmissible

record evidence essential to the verdict winner’s case.”

Id. at 454. And even if Kinser were good law, it would

be inapposite here, since the Federal Circuit did not

rule Dr. Howe’s testimony inadmissible; it simply ruled

that the record, zncluding his testimony, was insuffi-

cient to permit a verdict for Anascape.

Questar Pipeline Co. v. Grynberg, 201 F.8d 1277

(10th Cir. 2000), ruled only that the district court had

incorrectly stricken certain evidence. /d. at 1290. It is

not even clear that the evidence at issue in Grynberg

was expert testimony. See id. at 1289 (observing no in-

dication “that Mr. Grynberg was actually testifying as

an expert”).° And Christopher v. Cutter Labs., 53 F.3d

1184 (11th Cir. 1995), ruled that the record as a whole,

including expert testimony that was valid and admissi-

ble (though some other testimony was not), sufficed to

support the verdict. /d. at 1192. Neither case sug-

gested that expert testimony, once admitted, could

never be deemed insufficient to sustain a verdict where

it was “not supported by any evidence at all” and con-

trary to “the objective content” of the governing docu

ments. Pet. App. 14.

: Although the Grynberg plaintiff offered expert testimony as

well, the Tenth Circuit ruied that it was “properly stricken.” Jd. at

1288.

18

Anascape also cites three cases in which appellants

relied on Daubert itself to challenge the reliability of

expert testimony on appeal, despite not having raised a

Daubert challenge below. In the first two, C.B. Fleet

Co. v. SmithKline Beecham Consumer Healthcare,

L.P., 131 F.3d 4380 (4th Cir. 1997), and Marbled Mur-

relet v. Babbitt, 83 F.3d 1060 (9th Cir. 1996)—both ap-

peals following bench trials—the appellate challenge

was expressly based on a failure of expert testimony

“to meet the standard for reliable scientific evidence

under Daubert,” an argument the appellants had failed

to preserve in the trial court. Marbled Murrelet, 83

F.3d at 1066; see also C.B. Fleet, 131 F.3d at 437. In the

third case, United States v. Gaskin, 364 F.3d 488 (2d

Cir. 2004), the appellant not only failed to raise Daubert

at trial, but stipulated to the expert testimony. 7d. at

460 & n.8. The courts of appeals refused to consider ar-

guments based on the Daubert admissibility standard

“in the guise of an insufficiency-of-the-evidence argu-

ment” where the issue had not been pressed before or

passed on by the district court. Marbled Murrelet, 83

F.3d at 1067; see also C.B. Fleet, 131 F.3d at 4387 (refus-

ing to perform a “first instance application of Daubert

principles on a record completely inadequate for the

nurpose”); Gaskin, 364 F.3d at 460 n.8. Here, by con-

trast, the Federal Circuit did not rule Dr. Howe’s tes-

timony inadmissible under Daubert principles; it simply

held, in line with established Rule 50 jurisprudence,

that the record as a whole could not reasonably support

a verdict for Anascape—an argument that was both

presented to and decided by the district court. Pet.

App. 28-31.

Anascape’s last case does not create a circuit split

either. On the contrary, the Second Circuit reaffirmed

that Daubert did not change settled Rule 50 doctrine,

19

but rather expressly contemplated the possibility of

judgment as a matter of law notwithstanding expert

testimony. /n re Joint H. & S. Dist. Asbestos Litig., 52

F.3d 1124, 11382-1133 (2d Cir. 1995) (noting that

Daubert, Turpin, and Brock “did not alter the tradi-

tional sufficiency standard’). Although the Second Cir-

cuit did reverse the grant of a Rule 50 motion, it did so

only by identifying eight serious deficiencies in the dis-

trict court’s analysis of the record, including reaching

scientific conclusions while citing no authority (¢d. at

1134); failing to address federal agency reports sup-

porting the verdict (¢7d. at 1135-11386); and disregarding

the Circuit’s prior rulings in the ease (id. at 1186). The

Second Circuit’s decision did not adopt a different “ap-

proach” to Rule 50; it simply applied the traditional and

accepted approach to the particular case before it.

linally, even if Anascape were correct that sore

panels had occasionally issued decisions that differ from

the analysis of Brooke Group, Matsushita, and the de-

cisions cited on pages 15-16 above, this Court should

await further percolation of the issue within the af-

fected circuits, in addition to percolation among the cir-

cults. That is particularly the case given that Anascape

has not identified any decision acknowledging a sup-

posed conflict. Indeed, Anascape itself did not appear

to know of any conflict when it sought rehearing in the

Federal Circuit four months ago.

II]. ANASCAPE’S REMAINING ARGUMENTS PROVIDE NO

BASIS FOR CERTIORARI

The remaining arguments Anascape asserts in its

petition fail.

First, nothing in Feeves v. Sanderson Plumbing

Products, Inc., 5380 U.S. 133 (2000), altered the accepted

20

understanding of Rule 50, much less overruled this

Court’s application of it in Matsushita and Brooke

Group. In Reeves, this Court reversed a court of ap-

peals decision holding that an employment discrimina-

tion plaintiff who proved a prima facie case of discrimi-

nation and convincingly rebutted the employer’s prof-

fered nondiscriminatory explanation could nonetheless

never reach the jury without proffering additional evi-

dence. /d. at 146. The Court made clear, however, that

judgment as a matter of law might sometimes be ap-

propriate in such cases: “To hold otherwise would be

effectively to insulate an entire category of employ-

ment discrimination cases from review under Rule

50[.]” Jd. at 148. The Federal Circuit’s consideration of

the record as a whole—including the “objective con

tent” of the key patent documents (Pet. App. 14)—was

fully consistent with Reeves. See 5380 U.S. at 148-149

(stating that the appropriateness of judgment as a mat-

ter of law “will depend on a number of factors,” includ-

ing “the probative value” of the plaintiffs evidence). If

anything, it is Anascape’s suggestion that expert evi-

dence should be treated differently from other evidence

for purposes of a Rule 50 motion that runs counter to

Reeves.’

’ The abuse-of-diseretion standard of review for admissibility

decisions, see General Electric Co. v. Joiner, 522 U.S. 136 (1997), is

irrelevant to this case. The Federal Circuit did not rule that Dr.

Howe’s testimony was inadmissible or, in Anascape’s words,

should have been “excised.” Pet. 19. Anascape elsewhere recog-

nizes as much. /d. at 8. Rather, the Federal Circuit simply ruled

that the evidence of record, taken as a whole including Dr. Howe's

testimony, did not permit a reasonable jury to find that the ’525

patent sufficiently described the invention claimed in the '700 pat-

ent.

21

Second, Anascape’s complaint of an “unfair ambush

on appeal” (Pet. 20) is meritless. Nintendo repeatedly

argued to the district court that the ’525 and ’700 pat-

ent specifications permitted only one reasonable out-

come, namely that the disclosure in the earlier patent

did not support the claims of the later patent. See sz-

pra pp. 7-8. Anascape was “on notice every step of the

way” that Nintendo was challenging the sufficiency of

its evidence, yet it “made no attempt to add or substi-

tute other evidence.” Wetsgram, 528 U.S. at 456.

Anascape’s claim that the Federal Circuit denied it

“any opportunity to lay a better foundation” for Dr.

Howe’s testimony (Pet. 21) rings hollow, given that it

could have sought a new trial in its petition for rehear-

ing, but did not. See Weisgram, 528 U.S. at 454-455 &

n.ll. Even in its petition for certiorari, Anascape still

does not explain what “better foundation” it could have

provided.

Third, nothing in the Federal Circuit’s ruling turns

expert testimony into “‘second-class’ evidence” for Rule

50 purposes. Pet. 28. The Federal Circuit approached

the record in the same way as this Court has, namely

by ruling that judgment as a matter of law was war-

ranted because Anascape, “in the appellate court’s

judgment, failed to present sufficient evidence.” Weis-

gram, 528 U.S. at 454. The Federal Circuit did not say

that expert testimony, once admitted, can never pro-

vide substantial support for a jury verdict, or that ex-

pert testimony deserved less regard under Rule 50

than other evidence. The fact that expert testimony

must satisfy “additional threshold requirements” under

Daubert (Pet. 23) is a consequence of Federal Rule of

Evidence 702; it is not a reason to exempt expert testi-

mony from the ordinary operation of Rule 50. Indeed,

it is Anascape that seeks to elevate its expert’s testi-

mony into a kind of “upper-class evidence” that, once

admitted, will always support a jury verdict in its pro-

ponent’s favor, even if it is otherwise unsupported or

contradicted by the “objective content” of governing

documents. Pet. App. 14. Just as there was no reason

to “insulate an entire category of employment discrimi-

nation cases from review under Rule 50” (Reeves, 530

U.S. at 148), there is no reason to do so for patent cases

involving expert testimony.

Fourth, there was no “manifest error’ here. Pet.

18, 24. Even as Anascape faults the Federal Circuit for

rejecting its expert’s conclusion, it does not deny that

Dr. Howe (1) failed to account for the numerous refer-

ences to “single input member’ present in the ’525 pat-

ent but removed from the ’700 patent; (2) did not ad-

dress the ’525 patent’s disparagement of the Chang ref-

erence, which used multiple input members; and (3)

admitted that the 525 patent did not disclose a device

with three input members that together provided

movement in six DOF, whereas the ’700 patent claimed

just that. See supra p. 7. The Federal Circuit did not

err, much less commit “manifest error,” in concluding

that Dr. Howe’s testimony was inconsistent with the

“objective content” of the patents, and that the patents

must prevail in such a conflict. Pet. App. 14; see Brooke

Group, 509 U.S. at 242 (“[WJhen indisputable record

facts contradict or otherwise render the opinion unrea-

sonable, it cannot support a jury’s verdict.”).

The testimony of an expert skilled in the art is cer-

tainly “relevant” to the question of priority date. Pet.

24. The testimony of this expert, however, was unsup-

ported and contradicted by the central objective evi-

dence in the case. The Federal Circuit did nothing

more than engage in a factbound application of settled

23

Rule 50 doctrine. Anascape’s dissatisfaction with the

outcome does not warrant this Court’s review.

CONCLUSION

The petition for a writ of certiorari should be de-

nied.

Respectfully submitted.

ROBERT J. GUNTHER, JR. WILLIAM F.. LEE

WILMER CUTLER PICKERING Counsel of Record

HALE AND DORR LLP MARK C. FLEMING

399 Park Avenue ILAUREN B. FLETCHER

New York, NY 10022 WILMER CUTLER PICKERING

(212) 230-8800 HALE AND DORR LLP

60 State Street

Boston, MA 02109

(617) 526-6000

william.lee@wilmerhale.com

SEPTEMBER 2010