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Exhibit B
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1 1063-64 (9th Cir. 2008) (Although the “instructions . . . may have been correct
2 statements of the law”, the “legal theory was erroneous, [so] the proposed jury
3 instructions were irrelevant”); Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d
4 1201, 1234-35 (Fed. Cir. 2014) (“[I]n all cases, a district court must instruct the
5 jury only on factors that are relevant to the specific case at issue.”).
6 Third, Apple cherry picks instructions on certain critical issues. For
7 example, although Apple recognizes that the CMs must prove the alleged tying
8 arrangement “foreclosed a ‘substantial volume of commerce’”, it includes only
9 part of the model instruction explaining what this element requires, omitting the
10 portion of the model instruction that explains that the CMs must prove a
11 substantial adverse effect on competition in the market for the alleged tied
12 product. See, e.g., Blough v. Holland Realty, Inc., 574 F.3d 1084, 1088 (9th
13 Cir. 2009) (“Thus, the inquiry is ‘whether a total amount of business,
14 substantial enough in terms of dollar-volume so as not to be merely de minimis,
15 is foreclosed to competitors by the tie’.” (quoting Fortner Enters., Inc. v. U.S.
16 Steel Corp., 394 U.S. 495, 501 (1969) (emphasis added)); Spindler v. Johnson
17 & Johnson Corp., No. C 10-01414 JSW, 2011 WL 13278876, at *4 (N.D. Cal.
18 Jan. 21, 2011) (effect on “substantial volume of commerce” element requires
19 showing of “pernicious effect on competition”); (Ex. F, Objections to Apple’s
20 Proposed Instructions No. 23; Ex. D, Objections to Apple’s Proposed
21 Instructions (Redline) No. 23).
22 Fourth, Apple’s proposed instructions contain argumentative and
23 inflammatory language. For example, Apple’s proposed instruction for the
24 elements of a breach of FRAND claim repeats the CMs’ argument that
25 “Qualcomm breached their FRAND commitment by refusing to negotiate
26 material terms of the SULAs with the CMs”. (See Ex. F, Apple’s Proposed
27 Instructions No. 62.) Elsewhere, Apple’s proposed instructions argue that
28
EXHIBIT B: QUALCOMM’S POSITION -4- CASE NO. 3:17-CV-0108-GPC-MDD
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1 Act. Once the contractual disputes have been addressed, jurors can more
2 readily understand the competition law claims, which in essence seek to
3 challenge Qualcomm’s patent license agreements and other contractual
4 arrangements.
5 The parties’ pleadings confirm that this is the logical way to view the
6 case. The first several counts in Apple’s complaint are for breach of contract
7 and other contract-related issues. The competition law claims do not appear
8 until the very end of the document—Counts LXII and LXIII. The “Factual
9 Allegations” section proceeds in the same fashion, beginning with Apple’s
10 products, followed by FRAND and Qualcomm’s licenses and other contracts
11 before eventually moving on to allegations of foreclosure of competition 150
12 paragraphs later. The CMs’ pleadings are similar. Indeed, they assert
13 competition law violations as defenses to Qualcomm’s breach of contract
14 claims (Fourth, Fifth, Sixth and Ninth Affirmative Defenses), further
15 confirming that the contract claims logically precede the competition law
16 claims.
17 Moreover, the sequence proposed by Apple and the CMs is unfairly
18 prejudicial to Qualcomm in two distinct ways. First, Qualcomm is a plaintiff in
19 this case just as Apple and the CMs are, with vitally important breach of
20 contract claims. Yet the instructions proposed by Apple and the CMs do not
21 address Qualcomm’s contract claims until two-thirds of the way through the
22 document, slanting the instructions in favor of Apple and the CMs and giving
23 the jury the misleading impression that Apple’s and the CMs’ antitrust claims
24 take primacy over anything else. See Howard v. Cincinnati Sheet Metal &
25 Roofing Co., 234 F.2d 233, 236 (7th Cir. 1956) (remanding for new trial where
26 “the instructions as a whole unduly emphasized [one party’s] version of the
27 case”).
28
EXHIBIT B: QUALCOMM’S POSITION -6- CASE NO. 3:17-CV-0108-GPC-MDD
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1 Second, aside from their sheer bulk, the structure of Apple’s and the
2 CMs’ proposal has the effect of drowning Qualcomm’s claims in a sea of Apple
3 instructions. Qualcomm’s claims are scattered among Apple’s and the CM’s
4 claims and defenses, out of order, like oh-I-almost-forgot, offhand comments.
5 In fact, Qualcomm’s claims are so submerged that they are hard to find even if
6 one is looking for them. 6 They simply disappear among the claims and
7 defenses of Apple and the CMs. This unfairly slants the instructions in favor of
8 Apple and the CMs and prejudices Qualcomm.
9 What is more, some of Qualcomm’s claims and defenses do not appear at
10 all. Although Apple and the CMs took pains to provide a meticulous
11 accounting of each of their affirmative defenses—including defenses that
12 ultimately are for the Court, not the jury, to decide, and new defenses not in any
13 pleading7—Apple and the CMs failed to do the same for Qualcomm. The vast
14 majority of Qualcomm’s affirmative defenses have simply been omitted, even
15 though the same affirmative defenses have been included in response to the
16 same or similar claims asserted against Apple and the CMs.8 To give just one
17 example, Apple’s defenses to Qualcomm’s claims for breach of the BCPA are
18 set forth in Apple/CM Instruction 88, and include such defenses as laches and
19 estoppel (both of which are for the Court to decide). But the next instruction,
20 Instruction 89, which supposedly sets forth Qualcomm’s defenses to the
21 Apple’s BCPA claims, makes no mention of laches or estoppel, even though
22
6
23 7
They are in Instructions 67, 69, 83, 100 and 103.
(See, e.g., Ex. F, Apple’s Proposed Instructions No. 121 (“Violation of SSO
24 IPR8
Policy”.)
Apple’s and the CMs’ proposal includes 9 instructions listing 61 affirmative
25 defenses Apple and the CMs have purportedly asserted in response to
Qualcomm’s claims. Those are Instructions 68, 70, 88, 90, 91, 92, 102, 104 and
26 105. By contrast, Apple’s and the CMs’ proposal includes 2 instructions
identifying just 4 affirmative defenses asserted by Qualcomm—Instruction 47,
27 which describes the defense of antitrust mitigation, and Instruction 89, which
lists three of Qualcomm’s affirmative defenses to Apple’s claim for breach of
28 the BCPA.
EXHIBIT B: QUALCOMM’S POSITION -7- CASE NO. 3:17-CV-0108-GPC-MDD
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1 Qualcomm also asserted both defenses.9 And Qualcomm Counts III and IX
2 against Apple, as well as Qualcomm Count IX against the CMs, also do not
3 appear anywhere in Apple’s and the CMs’ proposal. As a result of these
4 omissions, Apple’s and the CMs’ proposal is not only improper, it actually
5 understates the length of the approach they have taken. The Court should reject
6 Apple’s and the CMs’ one-sided approach and adopt Qualcomm’s proposed
7 instructions.
8 II. THE COURT SHOULD ADOPT QUALCOMM’S PROPOSED
9 VERDICT FORM.
10 Like Qualcomm’s proposed jury instructions, Qualcomm’s 24-question
11 proposed verdict form is limited to issues that the jury must decide, avoids
12 unnecessary repetition and confusion, correctly reflects the law, and does not
13 engage in improper advocacy. Apple’s prolix proposed verdict form (62
14 questions), by contrast, repeats many of the same defects that pervade Apple’s
15 proposed instructions. Qualcomm’s specific objections to each disputed verdict
16 form question are set forth in Exhibit H. The most serious defects with Apple’s
17 proposed form are summarized below.
18 First, Apple proposes 33 questions (over one-half of Apple’s total
19 proposed questions) that are not for the jury and would be used only if the Court
20 empanels an advisory jury. 10 (See, e.g., Ex. H, Apple’s Proposed Question
21 No. 48 (whether BCPA contains unlawful liquidated damages provision
22 pursuant to Cal. Civ. Code § 1671(b)); Morris, 128 Cal. App. 4th at 1314
23 (whether provision constitutes unlawful penalty under § 1671 is for court).) 11
24 9
Although Qualcomm agrees that such defenses should not be submitted to
25 the jury at all, Qualcomm objects, of course, to any approach that would submit
Apple’s defenses to the jury but not Qualcomm’s.
10
26 As set forth in Exhibit H, Qualcomm objects to Apple Proposed Question
Nos. 2, 4, 7, 10, 12, 13, 14, 15, 16, 17, 19, 20, 21, 23, 26, 28, 29, 30, 31, 32, 34,
27 35,
11
37, 40, 43, 46, 48, 49, 51, 54, 57, 61 and 62 on this basis.
Apple does not dispute that these issues would be relevant only if an advisory
28 jury is empaneled.
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1 The Court should disregard these questions unless and until it decides to use an
2 advisory jury (which, as explained above, it should not do).12
3 Second, Apple proposes 21 questions about affirmative defenses (with
4 most questions addressing numerous separate defenses).13 These questions are
5 unnecessary and further contribute to Apple’s bloated proposal. Qualcomm’s
6 proposed verdict form does not explicitly ask about any affirmative defenses—
7 Apple’s or Qualcomm’s. Instead, Qualcomm’s proposed instructions tell the
8 jury which affirmative defenses apply to each claim and instruct the jury to
9 consider the applicable affirmative defenses before finding for the claimant.
10 The Court should utilize Qualcomm’s streamlined approach, which is sufficient
11 for the jury to render a verdict on all claims and defenses. See Mateyko v. Felix,
12 924 F.2d 824, 827 (9th Cir. 1990) (“The trial court has complete discretion
13 whether a general or special verdict is to be returned, and this discretion extends
14 to determining the form of the special verdict, provided the questions asked are
15 adequate to obtain a jury determination of the factual issues essential to
16 judgment.”).
17 Third, Apple improperly attempts to pursue affirmative defenses or
18 remedies that it waived, either by never pleading them in the first place or by
19 failing to assert them in the PTO. 14 See Jorst v. D’Ambrosio Bros. Inv. Co.,
20 No. C 00 03646 CRB, 2001 WL 969039, at *9 (N.D. Cal. Aug. 13, 2001) (“A
21 defendant waives an affirmative defense where the defendant fails to plead that
22 defense in its answer.”); Quantification Settlement Agreement Cases, 201 Cal.
23 App. 4th 758, 813 (Cal. Ct. App. 2011) (“A party who fails to plead affirmative
24 12
If the Court decides to empanel and advisory jury for these issues but to use
25 Qualcomm’s proposed verdict form, Qualcomm respectfully requests an
opportunity to submit proposed general questions for these issues.
13
26 As set forth in Exhibit H, Qualcomm objects to Apple Proposed Question
Nos. 2, 4, 7, 10, 13, 16, 19, 21, 23, 26, 28, 30, 34, 37, 40, 43, 46, 51, 54, 57 and
27 62
14
on this basis.
As set forth in Exhibit H, Qualcomm objects to Apple Proposed Question
28 Nos. 26 and 28 on this basis.
EXHIBIT B: QUALCOMM’S POSITION -9- CASE NO. 3:17-CV-0108-GPC-MDD
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