Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_10-cv-03561/USCOURTS-cand-3_10-cv-03561-415/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

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United States District Court

For the Northern District of California

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28 *

 This memorandum opinion need not address Google's objections regarding Kearl’s reliance on the

conjoint analysis performed by Dr. Steven Shugan, which was stricken as unreliable before the first trial,

inasmuch as it is part of Kearl’s inadmissible non-infringing alternatives analysis. Similarly, it need not address

Google’s objections to Kearl’s adjustments to the Kim model, inasmuch as the Kim model has been excluded

altogether.

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

ORACLE AMERICA, INC.,

Plaintiff,

 v.

 GOOGLE INC.,

Defendant. /

No. C 10-03561 WHA

MEMORANDUM OPINION

RE MOTIONS IN LIMINE

CONCERNING RULE 706

EXPERT

In this copyright infringement action, both sides moved to exclude portions of the

testimony of the court-appointed damages expert, Professor James Kearl. The final pretrial

order excluded Kearl’s disgorgement analysis to the extent it relied on non-infringing

alternatives (including his “no-Android” scenario). Similarly, it held that Kearl could not offer

testimony that relies on the econometric model of Min Jung Kim, which was constructed based

on data that could not be tested by any expert in this case. The reasoning for those rulings is

explained in the memorandum opinion relating to Oracle’s motions directed at Leonard (Dkt.

No. 1784).*

 

The final pretrial order also denied Oracle’s motion regarding traffic acquisition costs. 

This memorandum opinion explains the reasoning for that ruling.

* * *

Case 3:10-cv-03561-WHA Document 1929 Filed 05/20/16 Page 1 of 2
United States District Court

For the Northern District of California

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The parties dispute Google’s accounting practices regarding its traffic acquisition costs

related to advertising revenue from searches conducted on Android devices from 2011 through

2015. Google contends that beginning in 2011, it reported Android search TAC as part of its

company-wide search TAC and ceased reporting it on profit and loss statements specific to

Android. Oracle contends that Google also reported Android-related TAC as part of its lineitem for the cost of app and digital media sales on its Android profit and loss statements.

In calculating Google’s deductible expenses, Google’s damages expert Dr. Gregory

Leonard deducted an estimate of the proportion of search TAC from company-wide totals

attributable to Android as well as the cost of app and digital media sales. Oracle’s damages

expert, James Malackowski, responded that Leonard double-counted search TAC. Kearl opined

that Malackowski appeared to have been mistaken but acknowledged that this was a factual

dispute properly left to the jury. Kearl adopted Leonard’s methodology, but noted that he

would adjust if Malackowski’s understanding of Google’s accounting proved correct (Kearl

Rpt. ¶ 28).

Oracle seeks to exclude Kearl’s TAC opinions because he resolved ambiguity in

Google’s favor, although ambiguity regarding deductible costs should be resolved in Oracle’s

favor. See Frank Music Corp. v. Metro-Goldwyn-Mayer Inc., 886 F.2d 1545, 1549 (9th Cir.

1989). In his response to Oracle’s motion, Kearl reiterated that he viewed the disputed

accounting practices as a factual issue for the jury to resolve, and thus, he would provide a

damages estimate consistent with the resolution of the parties’ factual dispute.

The jury will be instructed regarding the burdens of proof relating to deductible

expenses, but it will not resolve the factual dispute before Kearl testifies. Nevertheless,

Oracle’s factual challenge to Kearl’s assumptions is not a basis for the exclusion of his

conclusions, rather, it is proper material for cross-examination and jury argument. For this

reason, the final pretrial order DENIED Oracle’s motion to exclude Kearl’s analysis of TAC.

Dated: May 20, 2016. WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

Case 3:10-cv-03561-WHA Document 1929 Filed 05/20/16 Page 2 of 2