On Friday, Magistrate Judge Paul S. Grewal ordered a third (and likely last) mediation talk in court between Oracle and Google for this coming Saturday, October 1. So far, it looks like a settlement isn't possible yet.
Today, Judge William Alsup, the federal judge presiding over this litigation, issued an "order requestinc case management statements". The order sets three deadlines for statements to be submitted by the parties. All of these deadlines show that the judge hasn't given up on the (uncertain) Halloween trial date and wants to reach a conclusion rather soon as to whether the case will go to trial in the near term or be stayed. A stay could relate to the case as a whole, or to certain claims while those are being reexamined by the United States Patent and Trademark Office.
I'll quote the order item by item and add my comments below each quoted section:
"By NOON ON SEPTEMBER 29, 2011, counsel for Oracle America, Inc. shall submit a case management statement listing each patent claim it will actually assert at trial and shall explain why the total number of such claims is consistent with prior representations made to the Court. In stating the claims to be tried, counsel must remember that any claim not asserted will be deemed foregone as to all accused matters."
In late May, when the judge accepted the parties' proposal for a tentative Halloween trial date (the parties had to choose a day in October and agreed on the last day of the month), he expressed doubts that "the number of claims Oracle would ask a jury to learn and to evaluate is 'triable'". This meant to say that Oracle would want to put so many patent claims (most patents have multiple claims, each of which is like a patent on its own as far as the infringement analysis is concerned) before the jury that the judge would rather stay the case (in whole or in part, as I'll discuss further below) than overburden the court and the jury.
The last position taken by Oracle on the number of patent claims it wants to assert was 21 (three claims for each of the seven patents). Oracle might go down from that position now in order to increase the likelihood of a near-term trial, but I believe Oracle will rather accept a stay (since it won't run out of cash in the meantime) than abandon too many of its claims. As the section quoted above says, any patent claims that Oracle drops now are lost forever with respect to its dispute with Google.
It's important to understand that this reduction of the numbe of asserted claims is purely a matter of case management. It has nothing to do with how strong or weak those patent claims and the related infringement allegations are.
I would be less surprised if Oracle still insisted on the assertion of 21 patents than if Oracle went below seven claims. At the very least I believe Oracle will want to assert one claim per patent.
Of the three deadlines the judge set, this is the only date that's right before the upcoming Saturday settlement meeting.
"By NOON ON OCTOBER 3, 2011, counsel for Google Inc. shall state separately as to each such claim the full extent to which counsel concede any such alleged infringement but for any issues of invalidity and shall specify, claim by claim, any and all invalidity defenses to be asserted at trial."
Only the infringement of a valid patent claim matters. However, if a patent claim is deemed valid, then the court also has to decide on its infringement. The first part of this quoted section (everything until "issues of invalidity") means that Google should say to which infringements it admits even though by doing so Google wouldn't waive its right to still contest the validity of an infringed claim.
Realistically, Google won't admit anything. Google will continue to say that all of the asserted patent claims are neither valid nor infringed. The question raised by the judge could, however, indicate that some infringements are pretty clear, especially since Google lost the claim construction battle, an important interim step toward an infringement finding. In a recent blog post ("Not much left of Google's 20 affirmative defenses against Oracle"), I discussed Google's "no infringement" defense right at the start and said, "Google will have a hard time convincing the jury (which the judge will instruct to construe those disputed terms according to his [claim construction] order) that it doesn't infringe at least a significant number of Oracle patent claims".
Google's final list of invalidity defenses is important information for the court, and for Oracle. At this stage, hundreds of invalidity contentions are in play. Just like Oracle will have to narrow its infringement assertions, Google will have to limit its invalidity contentions as well.
"By NOON ON OCTOBER 4, 2011, both sides shall update the Court on the status of each re-examination pending for each such claim and shall explain why the case should not be stayed in whole or in part until the re-examinations are completed. Counsel are expected to honor their full duty of candor as officers of the court."
Google made some initial headway with the reexaminations of Oracle's patents, which the USPTO started at Google's request. However, a high rejection rate at the stage of "first Office actions", which are by definition just preliminary, is not unusual, and the final outcome of such reexaminations typically looks very different. Also, those Oracle patent claims that survive reexamination will enjoy an enhanced presumption of validity.
Given that a couple of Oracle patents held up pretty well even at the stage of first Office actions and that the copyright part of the case (which Google failed to have thrown out on summary judgment) is not subject to reexamination, a complete stay of the case is less likely than a partial one. I think Oracle isn't afraid of either possibility. A complete stay would cause a delay and might open a window of opportunity for a Google countersuit, but Oracle could probably deal with all of that. A partial stay might even be good for Oracle. It could possibly prevail on the first few claims (copyright and a couple of particularly strong patents), and then later have a second trial with additional claims, some of which might then enjoy an enhanced presumption of validity. But going into any trial with a very few claims is risky. Within about a week we'll see if Oracle argues that the case should be tried or stayed as a whole rather than in part.
Google is likely going to argue for a complete stay, as it did on previous occasions, but will want to secure at least a partial stay.
"Also in the October 4 submissions, all counsel shall state the minimum number of hours needed for all direct and cross examination per side."
This is additional information for the judge with a view to how time-consuming a trial will be. It can also affect his inclination toward a stay or a go-ahead.
"Also state the extent to which plaintiff's latest damage study rests on copyright issues versus patent issues."
There's been plenty of confusion about Oracle's new damages calculation in the media. The judge now wants to know what role the copyright part plays in the overall damages calculation. It seems to me that the copyright part plays a significant role, though most of the damages are presumably patent-related.
"All submissions are limited to ten pages. The Court recognizes that some of this information will be provided in the final pretrial statements, but the Court requests the information now in order to manage its overall docket."
The page limit is just an administrative thing. The last sentence justifies why the judge asks for information at this stage that would usually just be required at the time of a pre-trial conference. It's clear that the judge wants to make all preparations that enable him to either confirm a near-term trial date or order a stay, which could last more than a year, possibly up to two years.
I don't expect today's order to make the parties change their positions fundamentally with a view to the meeting on Monday. Oracle has been aware all along of the possibility of a partial or complete stay. Google will continue to hope for a stay -- or any other delay -- until there's a 100% definitive trial date. Most likely, the Saturday meeting will end without a result.
The judge has certainly tried everything to force them to settle. But either party is entitled to its day in court.
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