No. 04 C5312 Page 4

potential prejudice to a defendant, we noted that “counsel always faces difficult tactical
decisions in planning an attack or defense.” Bifurcation I, at 839, Nothing has changed in the
interim. Jurors will neither see Mr, Nixon's report nor hear arguments asserting an adverse
inference, And while analysis of the “totality of the circumstances” remains the guiding test
(see Knorr-Bremge, 383 F.3d 1337), any attempt to circumvent Federal Circuit law can be
corrected with limiting instructions. Defendants’ arguments in support of bifurcation are
insufficient to carry their burden, See Real, 195 F.R.D. at 620.
CONCLUSION

For the reasons stated herein, we deny eSpeed’s motion for bifurcation.

JAMES B, MORAN
r Judge, U. S. District Court

( beg 32, 2007,



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

TRADING TECHNOLOGIES
INTERNATIONAL, INC,,

Plaintiff,
vs. No. 04 C $312

eSPEED, INC., SPEED INTERNATIONAL,
LTD, and ECCO WARE, LTD.,

Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiff Trading Technologies International, Inc. (“TT”) brought an action against
defendants eSpeed, Inc., ITSEcco Holdings Limited, and Ecco LLC (collectively “eSpeed”) for
patent infringement, including allegations of willful infringement, Eighteen months ago,

eSpeed moved for bifurcation of the patent infringement trial into two parts: (1) liability,

including non-infringement, invalidity and unenforceability; and (2) willfulness and damages.

We denied that motion. Since that determination we have issued a Markman’ ruling, granted
eSpeed’s motion for summary judgment of non-infringement on a majority of the accused
products, granted in part T'T’s motion for summary judgment regarding prior use, and denied
cross-motions for summary judgment of invalidity based on prior art. eSpeed now renews its
motion for bifurcation, arguing that the determinations of this court in the last year and-a-half

now support bifurcation. We disagree and deny eSpeed’s renewed motion for bifurcation.

‘Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed.Cir.1995), aff'd 517 U.S. 370 (1996).


No. 04 C 5312 Page 2

DISCUSSION

In our previous decision on eSpeed’s motion for bifurcation, we addressed eSpeed’s
arguments that bifurcation would promote judicial economy, and that prejudice would result
from the so-called “Quantum dilemma.” Trading Technologies Int’, Inc. vy. eSpeed, Inc., 431
F.Supp.2d 834 (N.D.I11.2006) (“Bifurcation I”), We assume familiarity with that decision and
decline to repeat our earlier analysis. We address below defendants’ additional arguments.

First, eSpeed contends that in light of our interim rulings bifurcation will now promote
judicial economy. It is true that defendants have met with some success in recent motions,
coming out ahead in the Markman determination (a dramatic shift from our preliminary claim
construction) and succeeding in convincing us that the majority of their accused products do
not infringe as a matter of law. Defendants’ invalidity motions have not been as successful,
We have only recently dealt with such motions, many of them cross-motions, deciding partially
in TT’s favor with regard to prior public use and denying cross-motions regarding prior art.
At this stage then, we have seriously limited the potential infringement case to be presented
at trial, while the invalidity dispute remains a determination for the jurors.

Taking stock of the case as it now stands, we find that the factors set forth in Real v.
Bunn-O-Matic Corp., 195 F.R.D. 618 (N.D.JI,2000), either weigh in support of denying
bifurcation or remain neutral. Due to the ruling of non-infringement, TT’s damages case at
trial will be limited to potential infringement — willful or not — of the remaining accused eSpeed
product. Therefore, the volume of damages documentation and evidence should be
substantially reduced. The infringement issues have been significantly simplified, The
number of infringing products has been reduced, and the outstanding claims, counterclaims

and parties remain the same. And finally, because we have made no determination of


No. 04 C 5312 Page 3

likelihood of success on TT’s remaining infringement case, the probability of success does not
weigh in either party’s favor.’ eSpeed has failed to carry its burden regarding judicial
economy,

Defendants’ second argument, that the parties have not yet completed damages
discovery, is insufficient te grant its motion for bifurcation. This case is three years old and
trial has been reset on several occasions, including once since eSpeed’s renewed motion for
bifurcation was filed. In the interim, TT has produced a Rule 30(b)(6) witness for deposition
and a number of damages documents. We reject defendants’ argument that it has not had
sufficient time to gather damages discovery.

Finally, defendants attempt to resuscitate their argument of prejudice based on the
Quantum dilemma, Pointing to TT’s expert witness report, eSpeed asserts that TT intends to
argue for an adverse inference of willfulness based on eSpeed’s assertion of the attorney-client
privilege. As we have previously discussed, the Federal Circuit has recognized a prejudice that
may result from a defendant having to choose between asserting an advice-of-counsel defense
to a willfulness claim, and maintaining attorney-client privilege. See Bifurcation I, at 837-38
(discussing Quantum and related cases). We also noted, however, that the Federal Circuit's
decision in Knorr-Bremse Systems Fuer Nutzfahrzeuge GmbH vy. Dana Corp., 383 F.3d 1337
(Fed.Cir.2004) eliminated the adverse inference or presumption that an opinion was
unfavorable where the defendant failed to obtain or disclose an exculpatory opinion of counsel.

Recognizing that elimination of the adverse inference did not completely eradicate the

? Defendants argue that they have a strong non-infringement argument under our claim construction, as their
initial product has an automatic recentering feature. As defendants have failed to submit a pretrial motion
for summary judgment on their initial product and TT has had no real opportunity to respond, we decline to
address the merits of eSpeed’s non-infringement case in the course of deciding this motion for bifurcation,