United States: Build On A Strong Foundation: How Expert Reports Are Constrained By Earlier Disclosures

Last Updated: January 5 2016
Article by Lillian J. Mao

Order on Motions to Strike Portions of Expert Reports, Finisar Corporation v. Nistica, Inc., Case No. 13-cv-03345-BLF (Judge Beth Freeman)

Expert reports are not written on a blank slate. Instead, parties are generally bound by what they've disclosed (or haven't) earlier in the case. In ruling on Finisar's and Nistica's motions to strike portions of each other's expert reports, Judge Freeman identified several rules of disclosure under the patent local rules and demonstrated their application.

Judge Freeman began by stating the general rule that early identification of infringement and invalidity theories is required: "Once served, the contentions constitute the universe of the parties' respective theories" and can be amended "only by order of the court and upon a showing of good cause. She then addressed the parties' motions.

Invalidity Theories

Turning first to Finisar's motion to strike opinions contained in Nistica's expert report on invalidity, Judge Freeman ruled as follows:

  • Undisclosed prior art references can be used to show the background of the art or the knowledge of one of ordinary skill in the art, but not to meet claim limitations. As to each disputed reference, Judge Freeman parsed Nistica's expert report and struck paragraphs where the references were used to meet specific claim limitations, but denied the motion to strike as to paragraphs where the report used the references for other purposes.
  • Inherent anticipation theories are not subject to the same disclosure requirements as doctrine of equivalents theories. Judge Freeman found that case law requiring more specific disclosures for doctrine of equivalents theories did not apply, since the patent local rules had specific provisions governing doctrine of equivalents but not inherent anticipation. She concluded that Nistica had sufficiently disclosed its inherent anticipation theories.
  • Additional references can be used to explain, but not expand, the meaning of an anticipatory reference. Nistica argued that it was relying on a patent to clarify a typographical error in the anticipatory publication from which the patent issued. Judge Freeman found that Nistica was using the patent to explain the meaning of the publication, and not in combination with it for purposes of anticipation. Thus, Nistica did not violate the rule that, for anticipation, all claim elements must be found within a single prior art document.

Infringement Theories

Turning next to Nistica's motion to strike opinions contained in Finisar's pair of expert reports on infringement, Judge Freeman ruled as follows:

  • Expert reports cannot introduce new theories, but may specify the application of a disclosed theory. Judge Freeman struck some of Finisar's infringement theories based on an earlier order by Magistrate Judge Corley, who had denied Finisar's motion to amend its infringement contentions to add those theories. Although Finisar argued that the disputed theories were not new but rather additional supporting evidence of its existing theories, Judge Freeman quoted the earlier order: "the Court has been down this road with Finisar: if that were the case, there would be no need to amend in the first instance." As to other parts of Finisar's expert reports, however, Judge Freeman found that Finisar indeed was not presenting any new theories but simply adding evidence in support of existing theories.
  • Theories of indirect infringement must identify the alleged third-party direct infringers. Judge Freeman found that this was required by Patent Local Rule 3-1(d), which for indirect infringement claims calls for "an identification of any direct infringement and a description of the acts of the alleged indirect infringer that contribute to or are inducing that direct infringement." Failure to identify the third-party direct infringers would deprive Nistica of fair notice.  Thus, Judge Freeman struck theories that involved an undisclosed third-party.
  • 271(f) infringement theories do not fall under Patent L.R. 3-1(d). Judge Freeman noted that 35 U.S.C. § 271(f) (which creates liability for exporting components that are combined outside the United States in a manner that would infringe if done within the United States), unlike indirect infringement, does not require proof of a separate act of direct infringement. Thus, Finisar could not rely on its Patent L.R. 3-1(d) disclosures (for indirect infringement) to support its § 271(f) theory, particularly when such Finisar failed to comply with the requirement to identify "any direct infringement" and describe "the acts of the alleged indirect infringer that contribute to or are inducing that direct infringement."
  • Infringement contentions must identify particular accused products and "do not allow for accusations by implication." Judge Freeman rejected Finisar's argument that by accusing a module, it was also accusing each product that incorporated the module. She quoted Patent L.R. 3-1(b), which requires each accused product to be "identified by name and model number," and struck the products that Finisar had not specifically identified in its contentions.

Timing

In several of Judge Freeman's rulings finding earlier disclosures sufficient, she suggested that the challenging party should have acted at the time of those disclosures rather than waiting until expert reports. For example, regarding Nistica's inherent anticipation theories, she said, "To the extent, [sic] Finisar thought Nistica's disclosures were lacking, Finisar could have brought a motion to compel to clarify Nistica's disclosures. Finisar chose not to . . . ."  Similarly, in denying Nistica's request to strike certain infringement theories, Judge Freeman held that, rather than assume what Finisar's infringement contentions meant, Nistica should have sought further clarification from Finisar about what satisfied a particular claim limitation. She found that although Nistica had sought clarification in correspondence after the contentions were served, Nistica "unreasonably assumed" from the communications what Finisar was relying on.

What is the take home? Make sure your infringement and invalidity contentions are thorough and complete, lest you foreclose potential offensive and defensive theories. And when reviewing those of the opposing party, make sure those disclosures are clear, lest you fail to rein in the scope of offensive and defensive theories available to the other side.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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