Case No. 5:17-cv-00072-BLF-SVK 

FINJAN’S OPPOSITION TO CISCO’S MOTION FOR LEAVE TO SUPPLEMENT EXPERT 

REPORT ON DAMAGES 

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Juanita R. Brooks (CA SBN 75934) brooks@fr.com 

Roger A. Denning (CA SBN 228998) denning@fr.com 

Frank J. Albert (CA SBN 247741) albert@fr.com 

Megan A. Chacon (CA SBN 304912) chacon@fr.com 

K. Nicole Williams (CA SBN 291900) nwilliams@fr.com 

Oliver J. Richards (CA SBN 310972) ojr@fr.com 

Jared A. Smith (CA SBN 306576) jasmith@fr.com 

Tucker N. Terhufen (CA SBN 311038) terhufen@fr.com 

FISH & RICHARDSON P.C. 

12390 El Camino Real, Suite 100 

San Diego, CA 92130 

Telephone: (858) 678-5070 / Fax: (858) 678-5099 

Aamir Kazi (Admitted Pro Hac Vice) kazi@fr.com 

Alana C. Mannige (CA SBN 313341) mannige@fr.com 

FISH & RICHARDSON P.C. 

1180 Peachtree Street NE, 21st Floor 

Atlanta, GA 30309 

Telephone: (404) 892-5005 / Fax: (404) 892-5002 

Attorneys for Plaintiff 

FINJAN, INC. 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA, SAN JOSE DIVISION 

FINJAN, INC., a Delaware Corporation, 

 

 Plaintiff, 

v. 

CISCO SYSTEMS, INC., a California 

Corporation, 

 Defendant. 

Case No. 5:17-cv-00072-BLF-SVK 

FINJAN, INC.’S OPPOSITION TO CISCO 

SYSTEMS, INC.’S MOTION FOR LEAVE 

TO SUPPLEMENT STEPHEN L. BECKER’S 

EXPERT REPORT ON DAMAGES 

Date: September 17, 2020 

Time: 9:00 a.m. 

Hon. Beth Labson Freeman 

Ctrm: 3, 5th Floor 

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TABLE OF CONTENTS 

Page

I. INTRODUCTION ............................................................................................................ 1

II. BACKGROUND .............................................................................................................. 1

III. LEGAL STANDARD ....................................................................................................... 2

IV. ARGUMENT .................................................................................................................... 2

A. Cisco Has Not Shown Good Cause For The Supplementation ............................. 2

B. Cisco’s Requested Supplementation Violates Federal Rule of 

Evidence 403 ......................................................................................................... 5

V. CONCLUSION ................................................................................................................. 6

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TABLE OF AUTHORITIES 

 Page(s) 

Cases 

In re ChanBond, LLC, 

No. 15-cv-852-RGA, 2020 WL 550786 (D. Del. Feb. 4, 2020) ............................................... 3 

City of Pomona v. SQM N. Am. Corp., 

866 F.3d 1060 (9th Cir. 2017) ................................................................................................... 2 

Eidos Display, LLC v. Chi Mei Innolux Corp., 

No. 6:11-cv-00201-JRG, 2017 U.S. Dist. LEXIS 52641 (E.D. Tex., Mar. 29, 2017) .............. 3 

Johnson v. Mammoth Recreations, Inc., 

975 F.2d 604 (9th Cir. 1992) ..................................................................................................... 5 

LaserDynamics, Inc. v. Quanta Computer, Inc., 

694 F.3d 51 (Fed. Cir. 2012) ..................................................................................................... 3 

Lucent Techs., Inc. v. Gateway, Inc., 

580 F.3d 1301 (Fed. Cir. 2009) ................................................................................................. 4 

Odetics, Inc. v. Storage Tech. Corp., 

185 F.3d 1259 (Fed. Cir. 1999) ................................................................................................. 4 

United Access Techs., LLC v. AT&T Corp., 

No. 11-cv-338-LPS, 2020 WL 3128269 (D. Del. June 12, 2020) ............................................ 3 

United States v. Hearst, 

563 F. 2d 1331 (9th Cir. 1977) .................................................................................................. 2 

Other Authorities 

Federal Rules of Civil Procedure 

Rule 16(b)(4) ............................................................................................................................ 2 

Federal Rules of Evidence 

Rule 402 ................................................................................................................................ 2, 6 

Rule 403 ........................................................................................................................ 1, 2, 5, 6 

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I. INTRODUCTION 

Cisco’s requested supplementation of Dr. Becker’s damages report has no relevance to any 

claim or defense at issue and is simply an attempt to get highly prejudicial information before the 

jury. The requested supplementation itself demonstrates it is irrelevant, as it makes no change to 

Dr. Becker’s overall damages opinion. Moreover, Fed. R. Evid. 403 prohibits the introduction of 

evidence that is likely to result in “unfair prejudice, confusing the issues, misleading the jury, undue 

delay, wasting time, or needlessly presenting cumulative evidence.” Other than presenting 

cumulative evidence, Cisco’s requested supplementation falls under all of the other Rule 403 

prohibitions. Therefore, Cisco’s motion should be denied. 

II. BACKGROUND 

On July 23, 2020, CFIP Goldfish Holdings LLC, CFIP Goldfish Merger Sub Inc. 

(collectively “Goldfish”) and Finjan Holdings, Inc. completed a merger transaction (the “Merger”) 

in which Goldfish purchased all issued and outstanding shares of Finjan Holdings, Inc. See Dkt. 

683-4 at 2. Following the close of the Merger, Finjan Holdings, Inc. survived as a wholly owned 

subsidiary of CFIP Goldfish Holdings LLC and will maintain its brand and business. See Dkt. 683-

9 at 4; Dkt. 683-5 at 2. 

Prior to the finalization of the Merger, Cisco requested Finjan agree to a broad re-opening 

of fact discovery including third-party discovery regarding the then-tentative Merger. See Dkt. 683-

8 at 2-3 (requesting supplementation of interrogatory responses and document production, 

supplementation of email production, and assurance that Finjan would not oppose document and 

deposition subpoenas to third parties). Finjan responded that the Merger is not relevant to damages 

in this action and that a reopening of fact discovery would significantly prejudice Finjan. Exh. 1 to 

Declaration of K. Nicole Williams (“Williams Decl.”). Following a meet and confer and the parties’ 

exchange of their respective portions of a joint discovery letter to Magistrate Judge van Keulen, 

Cisco elected not to raise the discovery issue with the Court. See Dkt. 683-7 at 2. Approximately 

two weeks after Cisco informed Finjan it would not be filing the joint discovery letter, it filed the 

present motion requesting leave to supplement the expert report of Dr. Becker regarding damages. 

Dkt. 683. 

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Expert discovery in this case ended on September 17, 2019. Dkt. 255 at 2. As a result of 

the Court’s Orders on Summary Judgment (Dkt. 487) and Daubert (Dkt. 549) and to include updated 

financial data from Cisco through July 2020, Cisco requested that the parties exchange mutual 

supplements to the damages reports of Drs. Layne-Farrar and Becker. Exh. 2 to Williams Decl. at 

3-4. Following the continuance of the trial date to October 2020 due to the COVID-19 pandemic, 

the parties agreed to do so on September 25, 2020. Id. at 2. With the exception of this mutual 

supplementation, the parties have not agreed to any other supplementation to the reports regarding 

damages. 

III. LEGAL STANDARD 

Irrelevant evidence is inadmissible at trial. Fed. R. Evid. 402. Further, Rule 403 precludes 

the introduction of evidence, even if relevant “if its probative value is substantially outweighed by 

a danger of one or more of the following: unfair prejudice, confusing the issues, misleading the jury, 

undue delay, wasting time, or needlessly presenting cumulative evidence.” Fed. R. Evid. 403. The 

Federal Rules of Evidence “confer broad discretion on the trial judge to exclude evidence on any of 

the grounds specified in Rule 403. . . .” United States v. Hearst, 563 F. 2d 1331, 1349 (9th Cir. 

1977). 

A party requesting modification of a Court’s scheduling order must show good cause and 

obtain the Court’s consent. Fed. R. Civ. P. 16(b)(4). 

IV. ARGUMENT 

A. Cisco Has Not Shown Good Cause For The Supplementation 

There is no good cause for Cisco’s proposed supplement to the expert report of Dr. Becker. 

In determining whether there is good cause, courts in the Ninth Circuit consider several factors. For 

example, whether trial is imminent. It is. Whether the request is opposed. It is. Whether the nonmoving party will be prejudiced. It will. The likelihood that the supplementation will lead to 

relevant evidence. It won’t. See City of Pomona v. SQM N. Am. Corp., 866 F.3d 1060, 1066 (9th 

Cir. 2017) (citation omitted). 

The parties’ damages experts agree that reasonable royalty damages in this action are 

determined through the construct of a hypothetical negotiation between Finjan and Cisco to license 

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the patents-in-suit at the time of first infringement, between 2012 and 2014. See Dkt. 547 (Jt. 

Proposed Pretrial Statement and Order) at 10. A merger and acquisition of Finjan completed 6 to 8 

years after the hypothetical negotiations and during an unprecedented global pandemic and resultant 

economic downturn has no bearing on the reasonable royalty the parties would have agreed upon 

during that hypothetical negotiation. 

First, the nature of the Merger as an acquisition of a patent owner and its ongoing litigations 

demonstrates that it is not relevant to the hypothetical negotiation. Courts have found that an 

acquisition of a patent owner after the filing of a lawsuit “is not comparable to the hypothetical 

negotiation” because it is not “an agreement between a party who has a patent and a party that wants 

to be able to use the patent, [but rather] it is an agreement between two parties who want to be on 

one side of that transaction, that of the licensor.” In re ChanBond, LLC, No. 15-cv-852-RGA, 2020 

WL 550786, at *2 (D. Del. Feb. 4, 2020) (excluding acquisition agreements and statements made 

during the acquisitions where there was “no showing . . .that the agreement between the two parties 

who want to be on one side of . . . a trial is a reliable basis as an input for determining the outcome 

of the hypothetical negotiation”); see also United Access Techs., LLC v. AT&T Corp., No. 11-cv338-LPS, 2020 WL 3128269, at *1 (D. Del. June 12, 2020) (defendants failed “to show that the 

litigation funding-related discovery it seeks here is relevant”). Here, as in ChanBond, Goldfish and 

Finjan entered into a Merger that included considerations well beyond the existence of the patentsin-suit, such as the ongoing litigations and Finjan’s patent portfolio and liabilities beyond the 

patents-in-suit. Additionally, Cisco (and Dr. Becker) fail to account for the fact that four out of five 

of the patents-in-suit expired between the date of the hypothetical negotiation and the Merger, 

making the Merger even less relevant to reasonable royalty damages. An agreement concerning 

expired patents has an “extremely low” probative value to patent damages. See Eidos Display, LLC 

v. Chi Mei Innolux Corp., No. 6:11-cv-00201-JRG, 2017 U.S. Dist. LEXIS 52641, at *14 (E.D. 

Tex., Mar. 29, 2017). None of the cases Cisco cites to support its relevance argument involve an 

acquisition of a company following expiration of the majority of the patents-in-suit.

Second, the financial landscape of the Merger agreement is vastly different from that of a 

hypothetical negotiation in 2012 and 2014 between a willing licensor and a willing licensee. 

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Differences between the parties’ economic positions during the hypothetical negotiation and a laterexecuted agreement involving the patent(s)-in-suit make the agreement irrelevant to a damages 

analysis. See LaserDynamics, Inc. v. Quanta Computer, Inc., 694 F.3d 51, 78 (Fed. Cir. 2012) 

(excluding evidence of a settlement agreement executed three years after the hypothetical 

negotiation in part because it was tainted by litigation costs, and the changing technological and 

financial landscape made the agreement “in many ways not relevant to the hypothetical negotiation 

analysis”); see also Odetics, Inc. v. Storage Tech. Corp., 185 F.3d 1259, 1276-77 (Fed. Cir. 1999) 

(affirming exclusion of two licenses negotiated four and five years after the date of first infringement 

because “the financial landscape has changed remarkably in the four to five years”). The effect of 

the COVID-19 pandemic is evident from Finjan’s public filings regarding the Merger at issue. For 

example, in Finjan’s Schedule 14D-9 filing, it cited as reasons for recommending the merger to its 

Board of Directors, “negative impacts on the Company’s business and prospects due to the COVID19 pandemic, many of which have or are likely to delay or frustrate the Company’s revenue streams 

and increase its operating expenses, including the mistrial in the Company’s case against ESET, 

revenue impacts relating to the difficulties of directly engaging in licensing negotiations in a remote 

working environment, court closures, uncertainty regarding court reopenings, the likely slow 

recovery in intellectual property licensing due to its non-essential nature and general economic and 

other uncertainties.” Dkt. 683-9 at 29. While the “book of wisdom” approach allows damages 

experts to consider events that happen after the hypothetical negotiation, that approach has limits.

Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d 1301, 1333 (Fed. Cir. 2009) (The law “affirms the 

availability of post-infringement evidence as probative in certain circumstances.”) (emphasis 

added). “The hypothetical negotiation tries, as best as possible, to recreate the ex ante licensing 

negotiation scenario and to describe the resulting agreement.” Id. at 1325. Inclusion of a merger 

agreement entered into during a pandemic that greatly impacted patentee (and the world at large) 

and after the expiration of four out of the five patents-in-suit is beyond the limit of any “book of 

wisdom” approach allowed by the courts. 

Finally, the lack of relevance of Dr. Becker’s supplement to the damages at issue in this case 

is demonstrated by the supplement itself. Dr. Becker concludes that the Merger is consistent with 

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the opinions set forth in his original expert report. Dkt. 682-5 at para. 8. Thus, Dr. Becker includes 

no recalculation of the damages at issue in the case. Id. As the existence of the Merger causes no 

change to Dr. Becker’s opinion, it cannot be the case that it is “highly relevant” to the damages case, 

as Cisco argues. Dkt. 683 at 3, 5. Further, Dr. Becker’s proposed supplemental report does not 

even attempt to identify the value of the single unexpired patent from the value of the Merger, which 

includes Finjan’s patent portfolio, pending litigations, and liabilities. See Dkt 682-5 This Court 

excluded patent licenses closer in time to the hypothetical negotiation precisely because the 

valuation of the patents-in-suit could not be ascertained from the agreement. See, e.g. Dkt. 640 

(Order re MILs) at 17-18 (excluding evidence of actual license agreements closer in time to the 

hypothetical negotiation where it was “unclear . . . how and why [the licensee] agreed to make [the] 

payment.”). 

B. Cisco’s Requested Supplementation Violates Federal Rule of Evidence 403 

While the “good cause” standard for modification of a scheduling order considers the 

diligence of the party in requesting supplementation, “the existence or degree of prejudice to the 

party opposing the modification might supply additional reasons to deny a motion.” Johnson v. 

Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992). Here, Cisco’s introduction of the 

Merger would be highly prejudicial to Finjan. 

Dr. Becker’s presentation of the Merger serves only to further Cisco’s attempts to disparage 

Finjan and paint it as a non-practicing patent assertion entity rather than an innovator in the field of 

web security. Such a misrepresentation of Finjan is highly prejudicial. It is also likely to mislead 

the jury, confuse the actual issue, waste time, and result in undue delay, all in violation of Fed. Rule 

of Evidence 403. 

For example, if Dr. Becker is allowed to supplement his expert report, then Finjan’s damages 

expert, Dr. Layne-Farrar, will have to supplement her expert report in rebuttal. In turn, both experts 

will have to be deposed on their respective supplementations, with trial only weeks away. At trial 

Finjan will be forced to waste time presenting testimony from fact witnesses and Dr. Layne-Farrar 

about the financial effects of this global pandemic in general and its effect on Finjan specifically. 

Finjan will also have to waste time cross-examining Dr. Becker on the same irrelevant subject. By 

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then, the jury will be thoroughly confused as to what the actual issue is it is being asked to decide 

concerning damages, i.e., what would a willing licensor and licensee have considered a reasonable 

royalty for the patents at issue, years before this pandemic descended upon the world. 

V. CONCLUSION 

Since Cisco has failed to show good cause for amending the scheduling order to allow 

supplementation of Dr. Becker’s report and since the proposed supplementation is inadmissible 

under Fed. Rules of Evid. 402 and 403, Cisco’s Motion for Leave to Supplement the Expert Report 

of Dr. Becker should be denied. 

Dated: August 14, 2020 Respectfully Submitted, 

By: /s/ Juanita R. Brooks 

Juanita R. Brooks (CA SBN 75934) brooks@fr.com 

Roger A. Denning (CA SBN 228998) 

denning@fr.com 

Frank J. Albert (CA SBN 247741) albert@fr.com 

Megan A. Chacon (CA SBN 304912) 

chacon@fr.com 

K. Nicole Williams (CA SBN 291900) 

nwilliams@fr.com 

Oliver J. Richards (CA SBN 310972) ojr@fr.com 

Jared A. Smith (CA SBN 306576) jasmith@fr.com 

Tucker N. Terhufen (CA SBN 311038) 

terhufen@fr.com 

FISH & RICHARDSON P.C. 

12390 El Camino Real, Suite 100 

San Diego, CA 92130 

Phone: (858) 678-5070 / Fax: (858) 678-5099 

Aamir Kazi (Admitted Pro Hac Vice) kazi@fr.com 

Alana C. Mannige (CA SBN 313341) 

mannige@fr.com 

FISH & RICHARDSON P.C. 

1180 Peachtree Street NE, 21st Floor 

Atlanta, GA 30309 

Phone: (404) 892-5005 / Fax: (404) 892-5002 

Attorneys for Plaintiff FINJAN, INC. 

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CERTIFICATE OF SERVICE 

The undersigned hereby certifies that a true and correct copy of the above and foregoing 

document has been served on August 14, 2020 to all counsel of record who are deemed to have 

consented to electronic service via the Court’s CM/ECF system. Any other counsel of record will 

be served by electronic mail and regular mail. 

 /s/ Juanita R. Brooks 

brooks@fr.com 

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