obama makes a claim of exhaustion in this case not license so it's important to understand what the relationship was between the particular suppliers at issue ranch in mobile at the relevant time i'd like to begin with discussing the district court's analysis of exhaustion relation to sales made by an s and us to t mobile prior to two thousand and seven to mobile it was by nokia products from nokia from nokia as telecommunications business in two thousand and seven sued and granted limited rights under a divestment rider the divestment rider had three crucial elements the license can be extended to divest a business only not a third party business the license is limited in time apply only while the future divest of business is operated as a separately identifiable business and the license is limited in product scope only to the extent of its likeable to products and services sold by the future divest of business briarfield for we have a crimes construction whether that is too broad or not certainly there are there are there are three elements separately identifiable the purchase has to be from the divest of business and the kinds of products so with respect to the kinds separately identifiable that's a common provision in these sorts of agreements designed to prevent the expansion of the license a part of divestiture what a what a business is divest it the licensee may well want for the business that's using the pa continue to be able to use it but the license or would not want the divest of business to be purchased and then expanded license to a curse that entirely new business that's not paid anywhere else these could could gain a could gain a license for free now i saw you argue that in the brief but i didn't see you point to anything to support that argument that contention i guess what i'm trying to figure out is what does separately identifiable mean and structure of the divestment rider it was entered into at a time when a t n t was splitting into three separate companies and the companies got together and they had a special rider to deal with divestment and what is the problem that would likely have been in the minds of people worrying about the expansion of patent rights to divest of businesses the concern is how do you make sure that things are done fairly that the divest of business say division which is doing something continue can continue to operate for some time but that  doesn't expand unfairly to swap to cover an entire new company which hasn't paid a license right the if our contention on this is at least plausible then we win because this was a summary judgment and the district co to the meaning of separately identifiable i think that there was not submitted and that separately identifiable if there are two alternatives the alternatives would be one that it just means separately identifiable from the entity which the best of the business which would need which would mean it's a knowledge there's no reason to write that kind of provision because the divest of business by definition has been divested separated from the from the original entity so a contract should not be construed in a way which gives no effect or meeting or which doesn't make the commercial sense they took a lot of care drafted you're saying that it simply identifiable somehow necessarily means it can't be a drawing venture and  how do i know that it could be a joint venture the problem is not the joint venture the problem was when they combined the nokia business with the siemens business and also they they faded out the siemens business the contract clearly says that only but divest the business license to divest and business was only the siemens division originally according to the evidence they faced that out the other problem is there's no evidence that any part of the seaman's divest business was ever acquired by the and s and united states company which actually made the sales here siemens was very big in europe not in the united states so they had to show that they bought from a divest of business they have to show that the products were ones that were being sold at the time and as soon as the business is no longer separately identifiable the license lapses and those things were shown below certainly not at the level required to separately identifiable you say the correct understanding is what separately identifiable from the acquirers business and what normally happens look at the  rembrandt what happened is there was a modem business and the modem business was spun off it was a business within a larger company it was spun off into a separate company and then that company i believe went public so in that situation you got a separately identifiable business the modem business the problem would come if that business was purchased by somebody gigantic say you know somebody like lucent or general motors  they would get a free license they can if they if they combined the telecommunications businesses together and that wouldn't be fair what are the characteristics that the court in corporate could corporate for could cruise ship that you would have a look at in order to determine that's a great question and the reason is there's been a lot of confusion of briefing about whether or not we're taking the position that a joint venture is somehow excluded that's not the position that they could have formed a joint venture contributed to siemens telecom business names of the two into people that are joining together for a particular purpose and that's what all right and that's and that's actually what we have here it's duckie a siemens network says what an s and stands for and what happened though if they had done a joint venture where they contributed to this business and maybe they contributed and then maybe nokia contributed a different business a cell phone pessimist not based ations in the things that issue in this case maybe there would be a problem if the joint venture was the contribution of the siemens business on the one hand and that nokia money for instance and that they therefore went for it in the world together maybe there wouldn't be a problem but once you mix two businesses together that have the same a business you have a problem and you have an extension of the right so that's what was negotiated for here this is a limited business so the summary judgment motion should have been denied we did file it we did file across motion on it so that's not before you but certainly so you want separately identifiable to mean that whatever the divest of businesses is  but in the same business line they have to reduce siemens business to ask the rate separately identified you have to be able to point to something in the new company if the if the if general motors which doesn't have wireless infrastructure business bought this business and remained separately identifiable to the market as something which people could buy products from buy but once you put the two together you mix the product lines for this case they actually drop the scene it's business and that resulted in that there was no domestic business any granted there were supposedly a sub license but a sub license can only can rise no further than the license and in the agreement the license expired when the patents expire at the end of two thousand and one problem i'm having with the argument you're making  these are sophisticated and to tease the big players and they wrote an agreement be it the the agreement permits just retroactive some licenses she negotiate and to stand this right to to retroactively extend a license beyond the life of the patent well it's a little bit like an option your honor has to be has a time period on it's how you have it they have a right to grant a sub license but if you want to call it a sub license as they did they have to extend it during the period when the license is active but the problem here is it doesn't make any sense to apply retroactive exhaustion which is a not be true in most cases but here's a specific provision that a permissive retroactive application that's open ended in at least it appears to me to be the case i understand what you're saying i'm saying this disagreement should be construed within its words there really is no such thing as a construed strictly but i want to move to the other question which is assuming even assuming they had a right to do this what is the effect there is no license to team obama clear claim it's exhaustion and they want to make a claim that this court extended exhaustion doctrine to retroactive awfully that happened here not what happened products were sold to t mobile they install them in their network infringement occurred a mature claim occurred at that point which has a separate characters character from for mission expired there was no abuse of the pap monopoly by the patent holder there was no extension of the pac monopoly unfairly and what they're asking you to do is to create for them a doctor which would help them out of the problem they had because they didn't they didn't grant the license earlier which would have wide ranging effects what's the purpose of a retroactive license isn't it to protect the licensees of licensee from liability for past i've had and i think that's probably since was a license between l m a and erickson think so even if it has some effect for ericsson inc it doesn't have any effect for t mobile unless you go further and adopt the concept of retroactive exhaustion which i suggest  observation actually applies to all of the licenses we're dealing with a t n t in lucent when they licensed these patents in the eighty's and ninety's received fair compensation in the form of the freedom to operate free of patent risk from their major competitors siemens ericsson and alcatel and also received substantial monetary compensation once the district court interpreted the licenses to enforce those promises that lucent in a t n t made against the current holder of their patents the district court of engaging the straightforward application of the exhaustion the divestment rider which was drafted by eighteen t if you look at the the rider it's on eighteen t letterhead and it says exactly what it says it says that the business have to be separately look at nokia siemens networks and say that it was the identifiable business separately identifiable business that came from the divested c middle just doesn't doesn't that they may give rise  question that maybe they're not separate the fact that the entity retain the name that make perhaps or controlling interest by one entity over that big board of directors  would be yes because whatever that is nokia's purchase of that i just a business that would be separately identifiable from scene and that's how i handle stand how the district court understood separately identifiable court's opinion and i think one has to read that in the overall context which is that we explained in our papers in the district court that n s a and was operated separately and independently from that matter well what it relates to is that ultimately eighteen t if they wanted to put additional restrictions into separately identifiable they were a sophisticated party who had the ability to write that and in fact in the parent hundred eighty eight siemens license they have specific terms for example on the ownership that's required of a subsidiary in order to for it to be a license and the divestment rider actually incorporates for example the time period term of the parent license so if for example eight hundred wanted the divestment rider not to apply if the divested business became a subsidiary of another company they could have written that into the license they chose not to do that the district court simply apply the plain language to interpret it as requiring only separation from any other business now i recognize that in the district court's opinion  like judge irene is focused only on separation from siemens but the record is undisputed that n s and was also separate from nokia and page twenty one of our brief we cite all the evidence that also separate from from nokia can you can you envision a divestiture joint venture or you really don't have a separate distinct corporate entity sure i mean hypothetically two companies could have a joint venture where they combined their business efforts and the company doesn't operate independently it's just you know two divisions of businesses operate together so supporters look at this and simply shouldn't we have a hypothetically there could be a genuine issue of material facts on the record in this case all of the facts regarding the operation of n s a and we're undisputed and they had it operated independently  business from for whoever a t m s he's margin archenemy competitor ended up buying this divested business from semen on one hand you know one could argue into the the parent business such that the the purchase of the divestiture from siemens is merely an artifice to obtain license rights that's not the situation we have here because we have a bona fide business transaction they created a separate independent entity how do we know we have a bona fide transaction that free you know breakaway from you know we've the record of the dabbous is that an f n was operated independently that it was created as a joint venture of these two businesses it had its own board of directors and most of them are from nokia right well ruled on was undisputed and then did not somehow have fealty to nokia and it wasn't carrying out a nokia business agenda it was operating as an independent entity highpoint never developed  offered any evidence and summary judgment record to dispute the independent operation of no it was their argument below and to the independent operation of the of the doing venture yes your honor absolutely there was it was set out in our summary judgment papers and again at page twenty one of our brief in this court we cite that evidence and it's notable that neither in their opening brief nor in their reply brief does high point offer any evidence that no argued before the district court only that separately identifiable could not cover the nokia products and there's an important issue there because under the rembrandt case in the exact kind of divestment rider from eighteen t v this court previously how that the category of products covered by this guy that's in that rider is broad and is not limited to a forms your honor i would agree with that and then after seeing the rembrandt case five point zero sort of shifted its argument and tried to to sort of wage that product limitation that they want into the separate identifiability issue but this court in rembrandt interpreted in the exact same kind of divestment rider treated those as different issues and on the product issue rembrandt is very clear that it's a broad license that's not limited to a particular kind of product so that if siemens had divested the business not to do a joint venture but into the just a siemens divested business and then they had acquired the nokia product line we wouldn't be here and so what what highpoint is really doing is essentially sort of a form over substance argument that says well because this is a joint venture now we can get around rembrandt and limited the products that the joint venture is licensed to sell and that's just not appropriate because this court really treated those two separate limitations in rembrandt and the think the purpose of this writer and the other side of things the purpose of this writer with make sure that the licensing rights were maintained within the scope of whatever's even seen in the previous leads in doing but now it's going to be occurring in the defensive business and to ensure that other competitors that are unlicensed weren't going to be able to somehow enjoy the benefits of online so i would say they're understanding of the writer your honor i would say that has to be viewed in that context which is actually in order to obtain operating freedom for eighty entities businesses rather than to limit the one to their operating freedom so with that context i think the purpose of the separate identifiability rider is in order to prevent somebody from using a divestiture acquisition as an artifice to obtain license rights it's not in order to govern what future forms eighteen entities spin off businesses and their licensing counterpart spinoff businesses would take there's no suggestion of that in in the wild within is it true what the other side of the joint venture he's selling predominantly the nokia pays line so they sold in china they sold the siemens line in other markets including the u s they consolidated the product line and actually after the joint venture was formed the products became backwards compatible quote unquote to the siemens product line in other words it was a joint and it then product line and admittedly it used the model intentionally included this right to retroactively sub license so that you didn't have to necessarily execute the license prior to a subsidiaries practicing the patent you could come back and execute it later now mr black is suggested that well even if they intended that the license should not run past the expiration of the patent but of course the right to dance right to sue for damages  court is well aware runs for six years after the expiration of a patent and so the need for retroactive stop license would continue during that six years and i think judge chan very recently recognized in the  expiration or immediately after a patent expiration now in karen as the court was dealing with an exclusive license but a a non exclusive sob license actually the same reasoning applies to that kind of double and in fact arguably a stronger there then you know here we have a contract the parties clearly anticipated that in the future one of them again lucinda or l american this is a stop license and so this is akin to the test or a case where a license was granted and there there was actually an express condition that the license was conditioned on the payment of royalties but the court that it didn't matter you granted an authorization to practice the pattens and therefore this other condition that had to be satisfied with the contract issue it doesn't limit the authorization that was granted to practice the past we have the same thing here lose it gave up its rights there's no dispute about that the only question is whether alan merrick been perfected the requirements to exercise those rights we think under the contract they did that they thing i would say is that this was a very well considered situation it wasn't as high point as suggested a casual decision by the district court there seven thousand seven hundred pages of record there was a two hour summary judgment argument that ran about one hundred and it's at the end of the appendix of the joint appendix so this was not something that the district court just did on the unconsidered record this was after two years of litigation and extensive briefing in argument thank you very much point only while the future divest of business operates it separately identify a business and b only to the extent of political products and services he writes highpoint argues that the sub license was not authorized because neither conditions and he were satisfied did one was determined by the products that are being shown i think what we argued night maintain that position is that you need to look at what actually happened with respect to the business there's a business and another business and you combine them in a joint venture you're likely going to end up with a situation where they are combined they could they caricature argument as being that well there's a joint venture exception that's not that's not what we're saying what we're saying though is when they combine the businesses they combine the boards and a lot of this evidence is in the record including in the appendix on appeal a sixty two thirty two thirty three etc state of facts we established before what happened with the business how they were combined how there was an new board of directors that were directors was controlled by nokia how the siemens business was tha discontinued how everything was controlled by this new and combined business so we we did make all those arguments wrong but you're saying the joint venture was controlled by nokia it was yes the board the board was split but no care i think we might not have the problem because then to the market the business would be separately identifiable to the people who are selling it that's who it at so it matters to it's not for me because i think a fair construction would be that so all nokia contributed was one hundred million dollars of record what could really be uncovered discover eileen from extends again it's possible to help understand separately identifiable as far as the understanding of separately identifiable i'm not sure that there's much more that could be found i don't know i don't know with respect to the facts we have a pretty extensive record this was the main issue for us on m s n and and we have a long record in the for and the they require