1 WO 2 3 4 5
9 IceMOS Technology Corporation, No. CV-17-02575-PHX-JAT
10 Plaintiff/Counter-Defendant, ORDER
11 v.
12 Omron Corporation,
13 Defendant/Counter-Claimant. 14 15 Pending before the Court are Omron Corporation’s (“Defendant”) motions to 16 preclude testimony of IceMOS Technology Corporation’s (“Plaintiff”) experts Walter 17 Bratic (Doc. 293) and Uzi Sasson (Doc. 299) (collectively, “Defendant’s Daubert 18 Motions”). The Court now rules on the motions. 20 On September 4, 2019, Defendant filed its Motion to Preclude Testimony of 21 Plaintiff’s Expert Walter Bratic (Doc. 293). Plaintiff responded on September 19, 2019 22 (Doc. 332), and Defendant filed its Reply on September 25, 2019 (Doc. 337). 23 On September 5, 2019, Defendant filed its Motion to Preclude Testimony of 24 Plaintiff’s Expert Uzi Sasson (Doc. 299). Plaintiff responded on September 19, 2019 25 (Doc. 333), and Defendant filed its Reply on September 26, 2019 (Doc. 340). 26 The parties also filed various motions to seal relating to Defendant’s Daubert 27 Motions. 28 1 a. Facts 2 Plaintiff is in the business of selling super junction metal oxide semiconductor field- 3 effect transistors (“MOSFETs”). (Doc. 25 at 2). Plaintiff needs fabrication services to 4 produce these products. (Id.). In 2007, Defendant purchased a wafer fabrication facility and 5 shortly thereafter suggested to Plaintiff that Defendant and Plaintiff should enter into 6 business together. (Id.). After negotiations, the two parties eventually came to an agreement 7 (“Supply Agreement”) on February 28, 2011. (See id.). The Supply Agreement provided 8 that Defendant would “perform the fabrication requested by Plaintiff” and that Defendant 9 would “fully resource the development of all generations of” Plaintiff’s super junction 10 MOSFET (“SJ MOSFET”) for the duration of the agreement. (Id.; see also Doc. 59 at 10; 11 Doc. 60 at 16). On March 6, 2018, the Supply Agreement terminated. (Doc. 60 at 37). 12 Plaintiff alleges breach of contract and fraud and seeks actual damages. (Doc. 59 at 33– 13 38). Specifically, Plaintiff alleges damages for lost profits and lost development support. 14 (See Doc. 59 at 33–35). The Court has dismissed Plaintiff’s claims for lost profits on 15 summary judgment but denied summary judgment as to the lost development support 16 claim. (Doc. 355). 18 When a party seeks to offer an expert opinion, the party must show that the expert’s 19 opinion satisfies the requirements set forth by Federal Rule of Evidence 702. Rule 702 20 provides: 21 A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if: 22 (a) the expert’s scientific, technical, or other specialized knowledge 23 will help the trier of fact to understand the evidence or to determine a fact in issue; 24 (b) the testimony is based on sufficient facts or data; 25 (c) the testimony is the product of reliable principles and methods; and 26 (d) the expert has reliably applied the principles and methods to the 27 facts of the case. 28 1 Fed. R. Evid. 702. Trial judges must make a preliminary assessment on whether expert 2 testimony is admissible. See Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 589 3 (1993). “[T]he trial judge must ensure that any and all scientific testimony or evidence 4 admitted is not only relevant, but reliable.” Id. The Rule 702 inquiry is “flexible” and its 5 “focus, of course, must be solely on principles and methodology, not on the conclusions 6 that they generate.” Id. at 594–95. 7 The party that offers expert testimony must show that the expert testimony is 8 admissible under Rule 702. Lust v. Merrell Dow Pharm., Inc., 89 F.3d 594, 598 (9th Cir. 9 1996). The requirements set by Rule 702 are conditions for determining whether expert 10 testimony is admissible. Thus, Federal Rule of Evidence 104(a) requires that the party 11 offering the expert testimony show that the expert testimony is admissible under Rule 702 12 by the preponderance of the evidence. See Fed. R. Evid. 104(a); Daubert, 509 U.S. at 592– 13 93 & n.10; Bourjaily v. United States, 483 U.S. 171, 175–76 (1987). 15 Defendant asserts that the expert testimony of Walter Bratic (“Bratic”) and Uzi 16 Sasson (“Sasson”) should be excluded because their testimony is irrelevant and unreliable. 17 (Doc. 293 (Bratic); Doc. 299 (Sasson)). The Court will evaluate each argument in turn. 18 a. Relevance 19 Because the vast majority of the testimony Plaintiff sought to offer through Bratic 20 and Sasson was on lost profits and the Court has granted summary judgment in favor of 21 Defendant on Plaintiff’s lost profits claim, (Doc. 355), the Court must preliminarily decide 22 if Bratic and Sasson have any other relevant expert testimony to offer. Rule 702 requires 23 that “the expert’s scientific, technical, or other specialized knowledge will help the trier of 24 fact to understand the evidence or to determine a fact in issue.” Fed. R. Evid. 702(a). 25 Therefore, a party offering expert testimony must show a valid connection, or “fit,” 26 between the evidence and any issue in the case. See Daubert, 509 U.S. at 591. Proffered 27 expert testimony must be “sufficiently tied to the facts of the case that it will aid the jury 28 in resolving a factual dispute.” Id. (citation omitted). 1 Both Bratic and Sasson can apply their expertise to relevant issues. Bratic estimated 2 the value of Plaintiff’s lost development support claim. (Doc. 293-1 at 47–49). Because 3 the Court has concluded that lost development support damages may be available here, 4 (Doc. 355), Bratic’s expert testimony may be fit for this case on that issue. If Plaintiff elicits 5 irrelevant testimony from Bratic at trial, Defendant can make an appropriate objection at 6 that time. 7 Sasson’s expert testimony is also fit on issues unrelated to lost profits. Sasson’s 8 expert testimony includes “opinions regarding the semiconductor foundry model, 9 forecasting of wafers, the relationship between a foundry and customer, global supply 10 chain for semiconductors, and wafer manufacturing and supply agreements.” (Doc. 299-1 11 at 4). Given Sasson’s expertise in these areas, although the Court cannot theorize every 12 issue that Sasson’s expertise may be relevant to, at this time, the Court cannot say his 13 testimony is wholly unfit to the issues presented in this case. Indeed, Defendant has not 14 argued that Sasson’s testimony as to the semiconductor industry or the products themselves 15 would not be relevant to any issue at trial. (See Doc. 299 at 18–19; Doc. 340 at 14). 16 However, the Court does not foreclose Defendant from making an appropriate objection 17 relating to Sasson’s testimony on any issue he may testify to. 18 Accordingly, the Court concludes that Bratic and Sasson may offer expert testimony 19 that may help the jury understand evidence or decide a fact at issue, and thus, Plaintiff has 20 shown their testimony is relevant. 21 b. Reliability 22 In analyzing reliability, the focus is on “principles and methodology, not on the 23 conclusions that they generate.” Daubert, 509 U.S. at 594–95. Thus, “the court’s 24 ‘task . . .
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1 WO 2 3 4 5
9 IceMOS Technology Corporation, No. CV-17-02575-PHX-JAT
10 Plaintiff/Counter-Defendant, ORDER
11 v.
12 Omron Corporation,
13 Defendant/Counter-Claimant. 14 15 Pending before the Court are Omron Corporation’s (“Defendant”) motions to 16 preclude testimony of IceMOS Technology Corporation’s (“Plaintiff”) experts Walter 17 Bratic (Doc. 293) and Uzi Sasson (Doc. 299) (collectively, “Defendant’s Daubert 18 Motions”). The Court now rules on the motions. 20 On September 4, 2019, Defendant filed its Motion to Preclude Testimony of 21 Plaintiff’s Expert Walter Bratic (Doc. 293). Plaintiff responded on September 19, 2019 22 (Doc. 332), and Defendant filed its Reply on September 25, 2019 (Doc. 337). 23 On September 5, 2019, Defendant filed its Motion to Preclude Testimony of 24 Plaintiff’s Expert Uzi Sasson (Doc. 299). Plaintiff responded on September 19, 2019 25 (Doc. 333), and Defendant filed its Reply on September 26, 2019 (Doc. 340). 26 The parties also filed various motions to seal relating to Defendant’s Daubert 27 Motions. 28 1 a. Facts 2 Plaintiff is in the business of selling super junction metal oxide semiconductor field- 3 effect transistors (“MOSFETs”). (Doc. 25 at 2). Plaintiff needs fabrication services to 4 produce these products. (Id.). In 2007, Defendant purchased a wafer fabrication facility and 5 shortly thereafter suggested to Plaintiff that Defendant and Plaintiff should enter into 6 business together. (Id.). After negotiations, the two parties eventually came to an agreement 7 (“Supply Agreement”) on February 28, 2011. (See id.). The Supply Agreement provided 8 that Defendant would “perform the fabrication requested by Plaintiff” and that Defendant 9 would “fully resource the development of all generations of” Plaintiff’s super junction 10 MOSFET (“SJ MOSFET”) for the duration of the agreement. (Id.; see also Doc. 59 at 10; 11 Doc. 60 at 16). On March 6, 2018, the Supply Agreement terminated. (Doc. 60 at 37). 12 Plaintiff alleges breach of contract and fraud and seeks actual damages. (Doc. 59 at 33– 13 38). Specifically, Plaintiff alleges damages for lost profits and lost development support. 14 (See Doc. 59 at 33–35). The Court has dismissed Plaintiff’s claims for lost profits on 15 summary judgment but denied summary judgment as to the lost development support 16 claim. (Doc. 355). 18 When a party seeks to offer an expert opinion, the party must show that the expert’s 19 opinion satisfies the requirements set forth by Federal Rule of Evidence 702. Rule 702 20 provides: 21 A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if: 22 (a) the expert’s scientific, technical, or other specialized knowledge 23 will help the trier of fact to understand the evidence or to determine a fact in issue; 24 (b) the testimony is based on sufficient facts or data; 25 (c) the testimony is the product of reliable principles and methods; and 26 (d) the expert has reliably applied the principles and methods to the 27 facts of the case. 28 1 Fed. R. Evid. 702. Trial judges must make a preliminary assessment on whether expert 2 testimony is admissible. See Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 589 3 (1993). “[T]he trial judge must ensure that any and all scientific testimony or evidence 4 admitted is not only relevant, but reliable.” Id. The Rule 702 inquiry is “flexible” and its 5 “focus, of course, must be solely on principles and methodology, not on the conclusions 6 that they generate.” Id. at 594–95. 7 The party that offers expert testimony must show that the expert testimony is 8 admissible under Rule 702. Lust v. Merrell Dow Pharm., Inc., 89 F.3d 594, 598 (9th Cir. 9 1996). The requirements set by Rule 702 are conditions for determining whether expert 10 testimony is admissible. Thus, Federal Rule of Evidence 104(a) requires that the party 11 offering the expert testimony show that the expert testimony is admissible under Rule 702 12 by the preponderance of the evidence. See Fed. R. Evid. 104(a); Daubert, 509 U.S. at 592– 13 93 & n.10; Bourjaily v. United States, 483 U.S. 171, 175–76 (1987). 15 Defendant asserts that the expert testimony of Walter Bratic (“Bratic”) and Uzi 16 Sasson (“Sasson”) should be excluded because their testimony is irrelevant and unreliable. 17 (Doc. 293 (Bratic); Doc. 299 (Sasson)). The Court will evaluate each argument in turn. 18 a. Relevance 19 Because the vast majority of the testimony Plaintiff sought to offer through Bratic 20 and Sasson was on lost profits and the Court has granted summary judgment in favor of 21 Defendant on Plaintiff’s lost profits claim, (Doc. 355), the Court must preliminarily decide 22 if Bratic and Sasson have any other relevant expert testimony to offer. Rule 702 requires 23 that “the expert’s scientific, technical, or other specialized knowledge will help the trier of 24 fact to understand the evidence or to determine a fact in issue.” Fed. R. Evid. 702(a). 25 Therefore, a party offering expert testimony must show a valid connection, or “fit,” 26 between the evidence and any issue in the case. See Daubert, 509 U.S. at 591. Proffered 27 expert testimony must be “sufficiently tied to the facts of the case that it will aid the jury 28 in resolving a factual dispute.” Id. (citation omitted). 1 Both Bratic and Sasson can apply their expertise to relevant issues. Bratic estimated 2 the value of Plaintiff’s lost development support claim. (Doc. 293-1 at 47–49). Because 3 the Court has concluded that lost development support damages may be available here, 4 (Doc. 355), Bratic’s expert testimony may be fit for this case on that issue. If Plaintiff elicits 5 irrelevant testimony from Bratic at trial, Defendant can make an appropriate objection at 6 that time. 7 Sasson’s expert testimony is also fit on issues unrelated to lost profits. Sasson’s 8 expert testimony includes “opinions regarding the semiconductor foundry model, 9 forecasting of wafers, the relationship between a foundry and customer, global supply 10 chain for semiconductors, and wafer manufacturing and supply agreements.” (Doc. 299-1 11 at 4). Given Sasson’s expertise in these areas, although the Court cannot theorize every 12 issue that Sasson’s expertise may be relevant to, at this time, the Court cannot say his 13 testimony is wholly unfit to the issues presented in this case. Indeed, Defendant has not 14 argued that Sasson’s testimony as to the semiconductor industry or the products themselves 15 would not be relevant to any issue at trial. (See Doc. 299 at 18–19; Doc. 340 at 14). 16 However, the Court does not foreclose Defendant from making an appropriate objection 17 relating to Sasson’s testimony on any issue he may testify to. 18 Accordingly, the Court concludes that Bratic and Sasson may offer expert testimony 19 that may help the jury understand evidence or decide a fact at issue, and thus, Plaintiff has 20 shown their testimony is relevant. 21 b. Reliability 22 In analyzing reliability, the focus is on “principles and methodology, not on the 23 conclusions that they generate.” Daubert, 509 U.S. at 594–95. Thus, “the court’s 24 ‘task . . . is to analyze not what the experts say, but what basis they have for saying it.’” 25 Wendell v. GlaxoSmithKline LLC, 858 F.3d 1227, 1232 (9th Cir. 2017). “Rule 702 grants 26 the district judge the discretionary authority, reviewable for its abuse, to determine 27 reliability in light of the particular facts and circumstances of the particular case.” Kumho 28 Tire Co. v. Carmichael, 526 U.S. 137, 158 (1999). 1 “[T]he relevant factors for determining reliability will vary from expertise to 2 expertise . . . .” See Fed. R. Evid. 702 Committee Notes on Rules—2000 Amendment. 3 “The trial judge in all cases of proffered expert testimony must find that it is properly 4 grounded, well-reasoned, and not speculative before it can be admitted.” Id. An expert’s 5 opinion can be based on the “application of extensive experience.” See id.; see also Kumho 6 Tire Co., 526 U.S. at 150 (“[T]he relevant reliability concerns may focus upon personal 7 knowledge or experience.”); Aloe Vera of Am. Inc. v. United States, No. CV-99-01794- 8 PHX-JAT, 2014 WL 3072981, at *11 (D. Ariz. July 7, 2014) (“Experiential expert 9 testimony . . . does not ‘rely on anything like a scientific method.’” (quoting United States 10 v. Wilson, 484 F.3d 267, 274 (4th Cir. 2007))). 11 The alleged “faults in [an expert’s] use of [a particular] methodology . . . go to the 12 weight, not the admissibility, of his testimony.” Kennedy v. Collagen Corp., 161 F.3d 1226, 13 1231 (9th Cir. 1998) (second alteration in original) (quoting McCullock v. H.B. Fuller Co., 14 61 F.3d 1038, 1044 (2d Cir. 1995)). “Vigorous cross-examination, presentation of contrary 15 evidence, and careful instruction on the burden of proof are the traditional and appropriate 16 means of attacking shaky but admissible evidence.” See Daubert, 509 U.S. at 596. 17 1. Bratic 18 Defendant argues that Bratic’s expert opinions regarding lost profits and lost 19 development support damages are unreliable. (Doc. 293 at 12–21). Any argument that 20 Bratic’s lost profits analysis is unreliable has been rendered moot by the Court’s conclusion 21 that lost profits are not available to Plaintiff. (Doc. 355). Thus, the Court will only evaluate 22 the reliability of Bratic’s expert testimony on Plaintiff’s lost development support claim. 23 Specifically, Defendant asserts that Bratic’s opinion relating to development 24 support costs for Gen 1 and Gen 2 SJ MOSFETs is based on a “misunderstanding” of 25 certain evidence. (Doc. 293 at 20–21). Defendant also claims that the calculations relating 26 to the Gen 3 SJ MOSFETs are not supported by any calculation or the underlying evidence. 27 (Id.). 28 1 Defendant’s argument fails. Bratic’s experience includes “analyzing market 2 opportunities and trends for various semiconductor products, structural changes in this 3 industry[,] and analysis of technologies related to semiconductor manufacturing and testing 4 equipment and semiconductor manufacturing processes.” (Doc. 293-1 at 4). The 5 Committee Notes to Rule 702 read, “Nothing in this amendment is intended to suggest that 6 experience alone—or experience in conjunction with other knowledge, skill, training or 7 education—may not provide a sufficient foundation for expert testimony.” Fed. R. Evid. 8 702 Committee Notes on Rules—2000 Amendment. Indeed, the Committee Notes 9 continue, “[i]n certain fields, experience is the predominant, if not sole, basis for a great 10 deal of reliable expert testimony.” Id. Therefore, Bratic may rely on his extensive 11 experience in the semiconductor industry to support his calculations. 12 Moreover, the Committee Notes also state: 13 When facts are in dispute, experts sometimes reach different conclusions based on competing versions of the facts. The emphasis in the amendment 14 on “sufficient facts or data” is not intended to authorize a trial court to 15 exclude an expert’s testimony on the ground that the court believes one version of the facts and not the other. 16 17 Id. Defendant’s main contention appears to be that the Court should accept its view of the 18 facts and exclude Bratic’s expert testimony. Indeed, Defendant argues that Bratic’s opinion 19 on damages for the Gen 1 and Gen 2 products is based on a misunderstanding of the 20 evidence. (Doc. 293 at 20–21). And, as for Bratic’s opinion as to damages relating to the 21 Gen 3 product, Defendant argues Bratic’s opinion is unreliable because Bratic did not 22 account for certain evidence. (Id.). The Court has already rejected this type of argument in 23 its order denying Plaintiff’s Daubert motions. (Doc. 343 at 16–18). As the Committee 24 Notes indicate, disagreement over which facts an expert decided to rely on is not an 25 appropriate ground for exclusion of expert testimony. See Daubert, 509 U.S. at 596. Rather, 26 any perceived fault in Bratic’s methodology goes to weight, not admissibility. 27 Accordingly, the Court finds that Plaintiff has shown by the preponderance of the 28 evidence that Bratic’s expert testimony on lost development support damages is reliable. 1 2. Sasson 2 As noted above, Sasson may not testify as to lost profits damages, but he may testify 3 as to general matters related to semiconductor products, including Plaintiff’s SJ MOSFETs, 4 and the semiconductor industry based on his fifteen years of experience in the 5 semiconductor industry. (See Doc. 299-1 at 5). As stated, “experience alone—or 6 experience in conjunction with other knowledge, skill, training or education” is sufficient 7 foundation for expert testimony. Fed. R. Evid. 702 Committee Notes on Rules—2000 8 Amendment. Consequently, the Court finds that Sasson’s expert testimony on general 9 issues relating to semiconductor products, like the SJ MOSFET, and the semiconductor 10 industry is reliable because Sasson may rely on his extensive experience in discussing these 11 issues. It is unclear at this time what particular issues Plaintiff may offer Sasson’s expertise 12 for, and thus, Defendant may object to the reliability of specific expert testimony Plaintiff 13 elicits from Sasson if appropriate. 15 Plaintiff and Defendant have filed various motions to seal in connection with 16 Defendant’s Daubert Motions. (See Docs. 320; 322; 330; 347; 348). Because review of the 17 unredacted materials was unnecessary to the Court’s resolution of Defendant’s Daubert 18 Motions, the requests to file unredacted versions of these documents into the record are 19 denied as unnecessary. See Maui Elec. Co. v. Chromalloy Gas Turbine, LLC, No. CIV. 12- 20 00486 SOM, 2015 WL 1442961, at *16 (D. Haw. Mar. 27, 2015). All documents filed 21 lodged under seal will thus remain lodged under seal. 23 Based on the foregoing, 24 IT IS ORDERED that Defendant’s Motion to Preclude Testimony of Plaintiff’s 25 Expert Walter Bratic (Doc. 293) is DENIED. 26 IT IS FURTHER ORDERED that Defendant’s Motion to Preclude Testimony of 27 Plaintiff’s Expert Uzi Sasson (Doc. 299) is DENIED. 28 1 IT IS FURTHER ORDERED that the following motions to seal relating to 2|| Defendant’s Daubert Motions (Docs. 320; 322; 330; 347; 348) are DENIED for the reason 3 || indicated above. The Clerk of Court shall not unseal the related documents and shall instead leave Docs. 295; 299; 331; 339; 342 lodged under seal. 5 Dated this 15th day of November, 2019. 6 7 '
James A. CO 9 Senior United States District Judge 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
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