Finjan, LLC v. Qualys Inc.

Opinion

1 2 5 6 FINJAN, INC., CASE NO. 4:18-cv-07229-YGR

7 Plaintiff, ORDER DENYING RELIEF FROM 8 vs. MAGISTRATE JUDGE ORDER

9 QUALYS INC., Re: Dkt. No. 114 10 Defendant.

11 12 Now before the Court is Finjan, Inc’s motion for relief from the Magistrate Judge Order 13 dated September 17, 2020. (Dkt. No. 114.) Under Federal Rule of Civil Procedure 72(a), the 14 court must “modify or set aside any part of the [magistrate judge] order that is clearly erroneous or 15 is contrary to law.” Under Civil Local Rule 72-2, the motion may be denied at any time, including 16 when the court does not deny or set a briefing schedule within 14 days of the filing. In light of the 17 time elapsed, Finjan presumably knows that the motion has been denied. The Court writes to 18 confirm as much. 19 Finjan argues that Magistrate Judge Hixson erred in denying discovery of overseas sales 20 because some of the claims are for a “computer-readable medium.” As Judge Hixson found and 21 the parties agree, overseas sales are only relevant if they are tied to a domestic act of infringement. 22 (See Dkt. No. 105 at 1.) In other words, Finjan cannot recover damages for overseas sales of 23 products that infringe entirely abroad. See Power Integrations, Inc. v. Fairchild Semiconductor Int’l, 24 Inc., 711 F.3d 1348, 1371 (Fed. Cir. 2013). Judge Hixson found, and the parties agree, that Finjan’s 25 infringement contentions describe a system that only infringes after assembly. (Dkt. No. 105 at 2.) 26 Since the parties agree that any assembly takes place outside the United States, those products do not 27 infringe, and their overseas sales are not relevant. (See id. at 3.) 1 opposed to system claims. Judge Hixson expressly rejected this argument because Finjan’s 2 infringement contentions cross-reference identical analysis for both types of claims. (See id. at 3 n.1.) 3 The Court sees no error in this reasoning, which is based on Finjan’s own statements. In any case, 4 Finjan’s contention that the two claim types should be treated differently fails. Computer medium 5 claims are not infringed by computer code that is written in the United States—they are infringed by 6 media that stores infringing code. Finjan’s contentions acknowledge as much by referencing media 7 such as “RAM,” “floppy disks,” “CDs,” and “similar media for storing the software.” The problem of 8 assembly thus remains exactly the same: infringement does not occur until a party stores all relevant 9 code in a single medium. Otherwise, a party could infringe by storing computer code on entirely 10 different media (such as two different devices) that would infringe if someone cobbled it together.’ 11 Finjan has not shown the law supports such broad infringement theories, which means that Judge ge 12 Hixson’s order is not clearly erroneous or contrary to the law.”

13 Accordingly, the Court DENIES Finjan’s motion. Finjan’s motion to seal is DENIED for failure

14 to file a supporting declaration supporting confidentiality. See Civ. L. R. 79-5(d)(e); see also Civ. L. R.79-5(d)(1)(A). 16

17 IT Is SO ORDERED.

Z 18 19 Dated: December 4, 2020 20 YVONNE GONZALEZ ROGE UNITED STATES DISTRICT COURT JUDGE 21 22 23 24 ' Finjan’s evidence confirms the problem—the deposition transcripts Finjan attaches to its 25 motion suggest that Qualys stores code on multiple “platforms” and databases. The transcripts also suggest that non-US. clients (presumably, the customers who purchase Qualys’ products 26 abroad) would download any relevant code from databases outside of the United States. 07 ? Finjan’s citation to Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197, 1205 (Fed. Cir. 2010) is particularly unpersuasive because the case used identical analysis for both system 28 and computer readable storage claims.