cases to be heard today we have cases coming to us from two different district courts we have a case coming to us from the patent office and another case coming to us from the marriage systems protection board in addition to those four argued cases we have two other cases that will be decided on the briefs for the record that's case number twenty eleven thirty thirty seven ex some versus d h s n twenty eleven twelve seventy five in right another appeal from the past with that we'll hear argument in the first case feel number twenty ten fifteen twenty six dow chemical versus nova chemicals  afternoon well for good afternoon your honor and may please the court contrary to the district courts and those positions the standing issue doesn't turn on the content of any documents content of any schedules and for that matter it doesn't turn any credibility determinations while the district court held that no assignment could take place unless the patent was listed on schedule a that holding is given that the parties to the contract i mean in typical case the two we are here because two parties to the contract are arguing different positions here the two party interests are a law on law and their position similar with just what with respect to what they intended in the contract and i write about their positions are similar but with due respect your honor i don't think i'm in a difficult position and let me explain why patents and related technology it was also designed to obtain tax benefits for dow and dow in fact paid over a billion dollars to d g t r y and paid sixty eight million dollars on the patents and three and five six six four and what it is is a series of e mails exchanged between the representatives of who are preparing the contribution agreement and these documents make clear that dows position on what the contract means is absolutely inconsistent with what the parties intended these these two pages or a series of documents generated on january twenty seventh and january twenty eighth two thousand and two less than a week before the agreements were saw and and they make clear that dows argument that the loss of rights provision respect to every provision you cited so far there are two different views on how that what those emails actually say the other side would say that that for instance that the e mails clearly talk about bringing and maintaining a lawsuit and therefore they did not feel they should be interpreted as not dealing exclusively with pending litigation so i take your argument but as far as that being a blockbuster i think one has to admit that there's another side to this that could  arguably make even that ambiguous my wrong i think you are your honor it does say bringing in maintaining a lawsuit but what it provided was it talked about the issue was standing there's not a single word here about lost profits which is one of  one of their bigger arguments there is a discussion in these e mails about the fact that the p t l a agreement provided for assignment back to dow in the event that they needed it to bring a lawsuit in fact that's a provision of the p t o a agreement which actually ultimately ended up in that agreement this this document continually talks of standing it continually talks about for suits that are already pending it would make it simpler to have the patents just remain with our repeats that over and over again and it says that as a as a safety net they will have a schedule of excluded intangible rights which is the deed which is scheduled deed and in fact the original schedule d which was the only one of the schedules that was signed within the ninety day limits of these agreements did not exclude the patents ensued so all i'm saying is i think if you read this these emails carefully as i know you will i think you should whether you will is another matter counsel who should end up agreeing with me in one of the e mails position and i think that's a very significant element of these documents in fact the grant back provisions of the p t l a actually use the words loss of rights as well and they talk about assignment back to dow in case they have a standing problem and that the whole issue is standing and they want to deal with the pending litigation at this time and if there are if there was any future litigation the grant back provision would have provided for that that's exactly our position is there anything in the agreement the contribution agreement that explains what a loss of rights also there is nothing in that agreement that explains what loss of rights means but on the other hand clearly if you look at the agreements as a whole it is my my position that what was designed to be transferred was any and all patent rights and other rights that they were able to assign they ended up saying that way subject to three conditions and only three conditions schedule a was not one of those three conditions it followed the three conditions under really through their schedule is a separate sentence and it doesn't it's to be it's not linked to the assignment or anything  else but but that phrase loss of rights is a curious phrase that's thrown in there at the end of the three conditions and seems to have at least some ambiguity your honor if it does have ambiguity it is i think it is resolved by five six six three and six four but i think is that it was in actual agreement there that incorporates any explanation or any of those there's nothing in the agreement that says loss of rights means x but it is clear that it was designed to assign the very first item in what is assigned were the us patent rights it's a very first item twice in the p d l way and in a contribution agreement and it says any and all u s patent rights other than these three conditions dows theory is that this schedule a schedule b supplement which is this court found was schedule a has only for us patents which existed in two thousand and it is inconceivable to me at least that a document that says we're going to assign any and all documents except those that would result in a loss of rights would end up with four out of seventy three hundred us patents would you consider this time so i say the agreement itself has blazed marks in it that leads to this conclusion i agree there is no power graph that says loss of rights means x but i think that when you read the agreements as a whole you cannot come to the conclusion that potential litigation which is what they argue it is is is the result is that your view that the sentence in which that phrase  middle of that paragraph yes it is talking about well all patterns would be assigned all patterns that d t c c is able to assign to teach and then there are three separate clauses to follow one without the concept of a third party to without diminishing the royalties paid it and three without resulting in a loss of rights is there anything  other than the fact i'm just looking for some guidance i understand your honor other than the fact that when somebody is transferring any and all patents of any kind and the first list is us patterns for somebody to say that that means four out of seventy three hundred is improbable on its face that's to start with secondly the p d l a and the contribution agreement were just decided on the same day and the provision about the grant back dealing with if tao needs to have a title in order to sue and using the word loss of rights suggests that that it's tied to tao one in your sue but it certainly doesn't lead to the conclusion that out of seventy three hundred patents only four are going to be transferred and there's a separate problem the problem is that the district court relied on schedule b supplement as schedule a that document was amended as late as december two thousand and five the suit was filed in october two thousand and five you cannot tell from this record what was on that schedule at the time the suit was filed moreover there are twenty three patents that are on schedule b supplement and also on both schedules d schedules d are those that are excluded schedule a is are those that in are included these these documents are inherently untrustworthy the burden is on dow to prove its case on standing and i submit all of the all of the elements that i have talked about lead in the direction that they did not have standing that they did not prove their case and that therefore this case should be dismissed and further i submit it should be dismissed prejudice with it is prejudice because of the land's case which in fact was dismissed with prejudice on a standing issue they cite a case university of pittsburgh versus varian medical it's a federal circuit two thousand and nine case which says that we look what's dismissals with prejudice a s not favored but that case also says that if there was country may shift conduct or delay that then it could be dismissed with prejudice and we have outlined in our brave that not only was there a delay but we had to refile that's exactly right that's what would happen if it wasn't dismissed with prejudice subject to a potential loss of rights because there's a six year damages provision and there could be a damages cut off they could be cut off failed then of course there would be no transferred all da would own the patents and standing would be appropriate and that regard i think it's important if the case is different and i think the tyco case that was cited somewhere along the line where the opposite the opposite was true i do think though the dream it is pretty clear that it's transformers any and old patterns and applications of any kind and then there are these few exceptions including this provision we're talking about with the loss of rights so i think a lot of the dispute really does center on what the meaning is of this phrase loss of rights  yes i and i agree i think that's true but i do think it's also important to keep in mind that there is nothing in the in the contract that uses patent rights or patterns in lower case patents to say that all patents are transferred the only thing that has ever transferred is the capital p capital r patent rights that are expressly defined in that definitional provisions so there's nothing else in here  are transferred a lot of other things are transferred but as far as patents go it's always only what is in that definition and one of the things as you say is you're not going to transfer patents that involve a loss of rights now the district court who held a trial on all of us and considered everything that mr downer mentioned found that schedule a which is as you mentioned in that same paragraph that defines patent rights party show for by the schedule yes it says they shall provide a schedule and nine point zero seven i think is quite clear on the schedules that incorporates the schedules by reference and it says boy the schedules are important and if there's any error on those schedules the parties have to get together and amend them to correct them so no so mr downer's point that the schedule it's impossible at this point and using hindsight to deter ascertain what was on that schedule in two thousand and five that's all right i'm that question no i think that's i think that's incorrect the the we have we have a schedule a that is indeed in the appendix it's the one that the that the district court make any findings with me i know we made a finding with respect to the typo and schedule a yes he did make any findings with respect to what the relevant time periods which actually included on schedule a yes he did he found that these patents and sue were never reality and credibility lead you to conclude that it can't be that there were only four patents out of seventy three hundred and it well look there is no i mean ok that's and first of all that's not correct the vast majority thousands of foreign patents were put on that schedule thousands of foreign patents were put on that schedule and far as we know the foreign patents don't have this issue of collecting damages for lost profits for manufacturing entity which is the thing that i think concerned all these lawyers don't put these u s patents on there cause you're go lose rights if you sue somebody you're going to lose your right to collect lost profits if you put a patent on there that's why for the pre one thousand two thousand and two patents only four patents were were put on schedule a they were very very careful about that and in that regard let me let me make this point about those e mails that preceded the agreement first of all they did precede the agreement and they they they they were discussions of ideas that might possibly have it been implemented but they weren't implement what does the word or the the the term loss of rights mean in those e mails end i think it was trying to get at the idea that there might possibly with it reflect that that same concern in other words that was that concern was well you know when we have these patents especially these s patterns there's a lot of rights involved like the rights to lost profits and we might lose those we don't want to do that but he's but mr turner is absolutely wrong that the the language of those e mails or that the idea of those e mails w apple actually implemented in the contribution agreement for this reason he says those e mails show that only only pending litigation patents were were to be excluded that's what he said in other words if they're in pending litigation we met his that was his position and he said they're going to be put on schedule d well in fact schedule d is in the appendix it's got it's got one hundred  fifty eight patents on it there are only eight patents in litigation so it makes absolutely no sense what he was saying that is absolutely incorrect the idea expressed by doreen warrick in those e mails was not implemented when they finally got to the agreement and in fact if i thought you were going to argue that section nine zero one says you've got to ignore everything other than the terms of this agreement right well argument that the email should not be considered at all yes side of the document absolutely so then what happens if we at the end of the day disagree with the district court judge and think there is at least some ambiguity in the terms of the just that leaves us well i think the if i understood understood the discussion so far it was that there might be some ambiguity over the idea of loss of rights now so i would suggest that you look at it this way if you were to conclude that the the the debt that the place where loss of rights appears is in the definition of patent rights we know that and we know that schedule a is referred to in that same paragraph so i believe that if you want to try to figure out what was going on in that regard then this is what was going on as i said there's a lot of rights associated with patents and there's a lot of patents that out dollars a lot of us patents thousands and thousands and thousands of patents with a lot of rights associated with them so there is a little you might say i wouldn't say it's ambiguity myself and i would say this thing is perfectly clear but there's a little bit of fuzziness around the term loss of rights schedule a is what makes it absolutely definite in other words it says etc that we are able to convey and then separate sentence the party shall provide a schedule yes and i think so if you say if you if you want to say well i look at that and it's not crystal clear then i think the the best understanding the best implementation the best way to resolve the issues to can to carry out might say what that contract really was intended to carry out is to stay that schedule a was was specifically there in order to make it very very definite so to take any ambiguity or an fuzziness or indefiniteness out of the idea of schedule of loss of rights and make this dissent like the district courts etc yes that's right no bet is essentially what judge farnan said and then as it's also true the judge farnan held the trial and he said i've looked at all their course of conduct evidence and i don't see anything in it the changes the onion big meaning of this contract in particular the meaning of schedule so i think that they asked me for it we're doing discovery on this issue during the entire trial on the merits of the evidence just not render alter the fact that it's plain and ambiguous that's correct that's right there a little tension there well  extrinsic evidence for a little beary limited purpose early to determine whether or not the contract is in big us or not and so he's like that and he's he's sitting there he's sitting there as a third circuit judge me saying you know maybe i better follow what they tell me and so he says they insist on having a trial they're knocking on my door saying you've got to give me a trial on this issue is ok we'll have a trial so he gives them a trial he says i listen to all that evidence it doesn't change anything we review its findings with respect to the extent that's a finding with respect to the extrinsic evidence do we review that clear i think i think you do review that for learned charge of the case found the contribution agreement and decided that you know we have to deal with the so we turned it over to you know but now by that time we didn't we knew how it if going to do everything they possibly can do and i suppose there is some remote chance that some court might find against this on this so we'll transfer it back and if if that's the case but they didn't we were confident that i was confident that that the ultimate resolution of this issue would be that own the patents and that they were not they were not transferred well they were to some difference when they're not what he did was this he he looked he contacted people who were familiar with schedule a in a contribution agree with they were familiar with schedule what but but that's not what that's not what was in his mind use what is called the i p m s database and the ip m s database is a comprehensive database that maintains that includes all information including ownership information it includes all the information that would be on schedule plus additional information so he was quite confident that we when he filed this lawsuit sense i p m s said dolly owns it the standing was very quickly section nine zero one which judge pros referred to and which mr roper talked about saying why you can't look at the e mails he's basically suggesting that this document prevents you from looking at anything suggesting the intent of the agreement that can't possibly be i don't see and i submit that paragraph was not designed to do that section nine zero seven says that if something is omitted or included in agreement it won't change the basic rights under the agreement so the focus on these documents is just not accurate the i p m s database was not updated after the contribution agreement the record makes that absolutely clear reliance on that judge rainer's focus on the quit claim assignment i think it's clear what the quicklime assignment was dow was worried about what the state of affairs was and dow has been backfilling from the beginning of this suit to the end the only document that was prepared within the time limit the ninety days was schedule d and that didn't exclude the patents ensuite they had a schedule a which wasn't prepared until two thousand and nine they had a schedule b supplement which was prepared during the years and amended after the suit was filed everything smells to high heaven your honour's i don't think the schedules are reliable at all and i think the agreement is clear on its face and leads to the conclusion that there is no standing what is your response to mr roper's comment about schedule d including not simply the patents that were in litigation but over one hundred other  your honor i don't have a response i don't i don't know the answer to that question all right very good thank you and thank you both counsel cases submitted