Donna Kline's interview with Leader CEO Michael McKibben

The fight goes on. Click here to read Leader's Federal Circuit Opening Brief and click here to read Donna Kline's blog that includes an eyewitness report from the Federal Circuit Appeal Hearing, including the Facebook appeals attorney's apology to his client.

Sunday, September 4, 2011

2. Jury transforms disbelief into evidence

Opinion: One blogger's perspective

With regard to early commercial activity, the jury based its finding on evidence it created—a potentially ruinous precedent if not overturned on appeal; sets the stage for inventor smear campaigns

Where the playing field was even, Leader Technologies beat Facebook. Facebook "literally infringes" Leader's patent on 11 of 11 claims and there is no published prior art. Much evidence and expert testimony was provided on both sides in a three-day "battle of the experts" for this part of the trial. Put simply, the engine running Facebook is Leader’s invention. See Leader Opening Appeal Brief, also at Leader.

However, where the playing field was not even, Facebook confused the jury and won a verdict on a technicality called "on sale bar." This concept is so esoteric that we’ll just call it "early commercial activity." The "on sale bar" law says that an inventor cannot offer his patent for sale more than twelve months before the patent application is filed. This claim was added to the case after the close of discovery over Leader's objection of prejudice, preventing Leader from being able to prepare its defenses.This "win" by Facebook "invalidated" Leader's patent for the purposes of this trial (but not for other trials). See Facebook's trial conduct.

Leader is asking the Federal Circuit Court of Appeals to overturn the early commercial activity verdict for lack of evidence and for a misinterpretation of the law; the court permitted disbelieved testimony to be transformed into "affirmative evidence" that the ostensible opposite was true. Op.cit.

Disbelieved testimony was transformed into new evidence

The trial court Opinion stated that it was the "evident finding" of the jury that inventor Michael McKibben's testimony was not credible, and that "[t]here is nothing impermissible" in allowing this mere disbelief to be transformed into "affirmative evidence" that the opposite of his testimony is true. In other words, McKibben said A was true, so the jury was permitted to assume affirmatively that Z was true instead. Opinion, pp. 51-52, JA-000054-000055.

The legal standards of proof in this case were distinguished among: (1) beyond a reasonable doubt, (2) clear and convincing, (3) a preponderance. Amazingly, the trial court declared that the opposite of disbelieved testimony alone was "clear and convincing." Op.cit.; See Jury Instruction No. 1.11.

Facebook had a "clear and convincing" burden to prove early commercial activity. In keeping with the law, the jury was instructed to analyze the alleged offers with an element-by-element comparison of the product alleged to have been offered for sale against the claims of the invention. See Jury Instruction 4.7.

Software source code was required

For a software patent, an element-by-element analysis must necessarily be done with software "source code" since there is no other way to prove if the gears and pulleys of the unseen code are present. Facebook showed no Leader source code and presented no expert testimony, even though they were given full access.

So how did the jury reach this verdict?

According to the trial court's Opinion, the opposite of two items of inventor McKibben testimony were transformed into an alleged "inventor's admission" that Leader's brand name "Leader2Leader" embodied all the elements of the patent in 2002 (he said that it did not, as did co-inventor Jeff Lamb). Those were combined with a third item—a 2009 interrogatory stating that in 2009 "Leader2Leader® powered by the Digital Leaderboard®" practiced the invention. This answer did not address any time frame prior to 2009, yet the trial court made a conclusory statement that it did. That statement is proved wrong by a simple reference to the United States Patent and Trademark Office's trademark database. Opinion, p. 52, JA-000055; See also Patent Office records disprove Facebook.

Surprisingly, instead of the trial court following its own instruction to discard any testimony not believed, the court permitted the jury to use that disbelief as "affirmative evidence" that the opposite was true—that Leader2Leader in 2002 must have practiced the invention—despite there being no source code proof or expert testimony to that effect.

Patent law on early commercial activity—35 U.S.C. §102(b)

The law states:
"the invention must be ready for patenting. That condition may be satisfied in at least two ways: by proof of reduction to practice before the critical date; or by proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention." Pfaff v. Wells Elecs., 525 U.S. 55, 67-68 (1998).
Consistent with the law, the jury instructions stated:
"Facebook must prove by clear and convincing evidence that a product that met all the limitations of the asserted claims was ready for patenting and was offered for sale more than a year prior to the effective filing date. Jury Instruction 4.7.

"it is your duty and privilege to believe the testimony that, in your judgment, is most believable and disregard any testimony that, in your judgment, is not believable." Jury Instruction 1.7.
Facebook presented no proof of either Pfaff condition; they presented no source code and no engineering drawings or descriptions. Facebook provided no expert opinion on either Pfaff condition. In addition, they presented no testimony from the recipients of the alleged offers for sale. No evidence that could even remotely qualify as sufficient to enable a person of skill was presented.

The Trial Court Opinion

Instead of looking to the law for its guidance, the trial court Opinion looked to novel evidence and law constructed in the jury room:
"the Court believes that the jury's evident finding that Mr. McKibben was not testifying credibly does, under the circumstances of this case, constitute affirmative evidence that the invention was ready for patenting prior to the critical date"

"the combination of [1] Mr. McKibben's trial testimony (which the jury found non-credible), plus [2] his seemingly conflicting deposition testimony (presented to the jury at trial), plus the [3] interrogatory responses (which can reasonably be interpreted as an admission that the invention was ready for patenting prior to the critical date) that, together, are "sufficient" to satisfy Facebook's [clear and convincing] evidentiary burden.” 
Opinion, pp. 51-51, JA-000054-000055 (emphasis added).
The trial court Opinion contradicts its own jury instructions and the law.
  1. After instructing the jury to disregard any testimony not believed, the court not only did not discard that testimony, but it allowed it to be transformed into an ostensible opposite fact.

  2. The trial court then actually cited this not disregarded, new contra-testimony evidence as the corroboration for a third item of ostensible evidence, namely a 2009 false marking interrogatory—which cannot be an admission about Leader2Leader in 2002 because the interrogatory cites to registered trademarks that were not issued until 2003. See Patent Office records disprove Facebook.
To be clear, the three items of ostensible "clear and convincing" evidence were, according to the trial court ("N/A" = not applicable):

# Trial court's description of the "clear and convincing" proof If not believed Disposition of the evidence according to the law
1 McKibben deposition testimony Discard N/A
2 McKibben trial testimony Discard N/A
3 Interrogatory No. 9 N/A N/A
. Conclusion . No proof

All three elements of Facebook's ostensible "clear and convincing" evidence regarding early commercial activity are discredited. Therefore, no evidence of early commercial activity was presented.

"An ill-wind blows no good"

A Facebook "win" on the early commercial activity verdict would blow an ill wind across the U.S Courts. It would set a ruinous precedent that would encourage attorneys to double-down on "dark arts" against opponents to create new facts from opposites. Infringers would be encouraged to dispense with hard evidence per Pfaff, Group One and Linear, and would focus instead on smear tactics to manipulate the evidence in any way that would make the inventor look bad.

Facebook did not even try to meet this "clear and convincing" burden of proof. Instead, they resorted to attorney tricks and trial theater.  See Facebook's trial conduct; See also Expert witness practices "dark arts;" Missing Facebook Documents; No Evidence. No Problem. Fabricate it.; Facebook's "I'm tired" tactic; Facebook's "court room theater." 

Fig. 1: The witness testified that the glass was empty. However,
under the trial court's theory in this case, if the jury does not
 believe the witness, then the jury is permitted to create
"affirmative evidence" of the ostensible opposite. However,
what is  the opposite of an empty glass? Source:
Does a simple opposite even exist for most evidence?

Few items of evidence have only one opposite alternative, so the notion of "affirmative evidence" of the opposite cannot become an allowable evidentiary standard. For example, the witness might testify that the glass was empty. Under this trial court's theory of "affirmative evidence," if the jury disbelieves the witness, then they would conclude that the glass is full, i.e., the opposite of empty. However, the glass could also be half-full, one-quarter full, and so on. Other reasonable alternatives exist; therefore, the notion of “affirmative evidence” is innately flawed.

Smear campaigns

Facebook's recent conduct shows that they have no hesitation about organizing smear campaigns against opponents. Recently, after having its surreptitious activities exposed, Facebook admitted hiring a prominent PR firm to wage a "ham-handed" smear campaign against Google. Wired, May 12, 2001. If infringers become emboldened by a Facebook win in this case, attacks on inventors will become standard operating procedure.

Common sense

Also, plain old common sense  dictates that any case that turns on only three items of suspect evidence cannot meet the "heavy burden" of clear and convincing proof. 

Implications of this appeal on the administration of justice in the United States if  Facebook's "dark arts" prevail
  1. Appeals will be meaningless—The appeal of any future patent case that wins by discrediting the inventor to the jury will be meaningless. Without evidence, the role of the appeals court in these cases will simply be reduced to the role of critic: How did the jury feel? Why did they disbelieve the inventor?

  2. "Dark arts" will overtake the process—Attorney "dark arts" will overtake trial preparation. The hypothetical precedent in this case would open all lawsuits to the possibility that if attorneys don’t have the evidence, they will focus on dark tricks of the trade and jury deception.

  3. Trial theaterBoston Legal-style court room theater will run amok as unscrupulous attorneys ply their trade on hapless juries to discredit truth-tellers with smear tactics instead of hard evidence.

  4. The art of appearing sincere will trump evidentiary substance—Every nervous witness will be characterized as a liar and every pause will be misconstrued as withholding evidence. The art of looking good will overrule evidentiary substance.

  5. Activist juries will create evidence from opposites—In addition to the jury's current role as the "trier of fact," they will assume a new role as the "creator of opposite facts."

  6. Attacks on inventorsthe creative engines of the American economy—For patent cases, infringers will undoubtedly focus on attacking the credibility of the inventor—further perfecting Facebook's "dark arts" success. Smear campaigns will endeavor to create ostensible opposite facts (should Facebook prevail in this appeal).

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