Excerpts From Transcript of Haedicke Testimony Recorded on 13-06-14

7/28/2019 Excerpts From Transcript of Haedicke Testimony Recorded on 13-06-14

1/28

EXHIBIT 1

Case 2:10-cv-01823-JLR Document 748-1 Filed 07/12/13 Page 1 of 28


2/28

In The Matter Of:

MICROSOFT CORPORATIONv.

MOTOROLA INC., et al.

___________________________________________________

MAXIMILIAN HAEDICKE - Vol. 1

June 14, 2013

___________________________________________________



3/28

MAXIMILIAN HAEDICKE - 6/14/2013

(800) 869-9132 www.merrillcorp.com/law

Merrill Corporation - San Francisco

Page 21

1 09:21:5you expect that they would enter into a license and

2 09:21:5dismiss the case?

309:21:5

A Depends if they also agree on the other issues

4 09:21:5which are involved in License Agreement. The license

5 09:22:0fee is one of the important aspects, but there are other

6 09:22:0aspects which also have to be covered, and they will

7 09:22:1only have a full-fledged and valid contract if they

8 09:22:1agreed on all essential elements of the contract, and

9 09:22:1only then will they dismiss the case, or would they

10 09:22:2make -- would they render the case moot.

11 09:22:2Q Let's suppose that the parties do not agree on

12 09:22:2a license fee.

13 09:22:2Does the Orange Book decision say that the

14 09:22:3defendant must use the second alternative option of

15 09:22:3letting the patent holder set the royalty?

16 09:22:3A Please repeat the question.

17 09:22:3Q If the parties do not agree on a license fee --

18 09:22:4A Yes.

19 09:22:4Q -- does the Orange Book decision say that the

20 09:22:4defendant must use the second option of allowing the

21 09:22:4patent holder to set the royalty?

22 09:22:4A They have the option. They do not -- they

23 09:22:5must -- they have the option to do it.

24 09:22:5Q Let's talk about a proceeding in which the

25 09:22:5court -- a court exams the royalty that has been set by



4/28




Page 22

1 09:23:0a patent holder through the alternative procedure.

2 09:23:0What evidence is considered in a proceeding

309:23:0

like that?

4 09:23:0MS. BERRY: Objection --

5 09:23:0THE WITNESS: This is --

6 09:23:1MS. BERRY: -- lack of foundation.

7 09:23:1THE WITNESS: -- this is speculative because

8 09:23:1I'm not aware of any rate setting procedures which have

9 09:23:1been brought to my attention. I have not taken part in

10 09:23:2any of those, so, of course, I cannot know the details,

11 09:23:2and I can only speculate, but my speculation would be

12 09:23:3that the parties will determine the rate according to

13 09:23:3the -- the standards which are used also when it comes

14 09:23:3to the determination of license fees; for example, when

15 09:23:4it's about damages or in cases like this. So I would

16 09:23:4assume that similar standards would be applied.

17 09:23:5BY MR. LOVE:

18 09:23:5Q And I think we discussed this earlier, so

19 09:23:5correct me if I'm wrong, but the standard used to

20 09:23:5evaluate the rate in that proceeding would be whether

21 09:23:5the rate was within the limits set by antitrust law; is

22 09:24:0that correct?

23 09:24:0A Yes.

24 09:24:0Q What happens if the rate set by the patent

25 09:24:0holder does not meet that standard?



5/28




Page 23

1 09:24:0A In 315 procedure?

2 09:24:1Q Yes.

309:24:1

A What happens if --

4 09:24:1Q What happens if the court determines that the

5 09:24:1rate set by the patent holder is not within the limits

6 09:24:2of antitrust law; what will the court do?

7 09:24:2A Then a -- a lower rate will be set, which is

8 09:24:3still in the limits. The court will control the offer

9 09:24:3which has been given by the patent holder, if there is

10 09:24:4such an offer, and will determine whether this is within

11 09:24:4the boundaries of antitrust law, and if not, the rate

12 09:24:4will be set according to antitrust law and the other

13 09:24:5important laws which come into play.

14 09:24:5Q Does the license seeker have to pay the rate

15 09:25:0that was set by the patent holder until the court rules?

16 09:25:0A Payment means transfer of funds to the -- to

17 09:25:1the licensor? No. He has to escrow money, as much --

18 09:25:1as much money as he deems appropriate. If he wants to

19 09:25:2be on the absolutely safe side, he may depose estimate

20 09:25:2escrow as much money as the patent holder has demanded,

21 09:25:3but as I said before, of course, if he thinks this is

22 09:25:3too much, he has the option to go below the rate

23 09:25:4demanded by the patent holder and let this rate be

24 09:25:4reviewed, and, of course -- yeah, so.

25 09:25:4Q Do you know how long a proceeding -- a court



6/28




Page 24

1 09:25:5proceeding under Section 315 to evaluate a patent

2 09:25:5holder's royalty rate takes?

309:25:5

A This is pure speculation because I'm not -- I'm

4 09:26:0not -- these have not taken place, as far as my

5 09:26:0knowledge is concerned. I could only guess.

6 09:26:0Q So have there been any reported German

7 09:26:0decisions that you are aware of that hold that the rate

8 09:26:1set by a patent holder under the alternative Orange Book

9 09:26:1process is acceptable?

10 09:26:1A As there are no reported 315 procedures, I'm

11 09:26:1not aware of that --

12 09:26:1(Telephonic interruption.)

13 09:26:2MR. LOVE: I'll -- I'll ask again just so we

14 09:26:2have a clear question and answer.

15 09:26:3Q As far as you are aware, there are no reported

16 09:26:3German decisions showing this second alternative Orange

17 09:26:3Book procedure?

18 09:26:3A The rate setting, the second -- the rate

19 09:26:3setting --

20 09:26:4Q Yes.

21 09:26:4A -- lawsuit? No, the rate has not been

22 09:26:4reported.

23 09:26:4Q So we believe -- you believe that the standard

24 09:26:4that a court would apply in that proceeding is

25 09:26:5whether -- is -- is to set a royalty within the limits



7/28




Page 25

1 09:26:5of antitrust law; correct?

2 09:26:5A Yes.

309:26:5

Q But we don't know for sure because there are no

4 09:26:5decisions?

5 09:26:5MS. BERRY: Objection; form.

6 09:27:0THE WITNESS: Purely speculating. I wouldn't

7 09:27:0see any other standards which might be reasonable. I

8 09:27:0wouldn't see any of those standards could come into

9 09:27:1play, so it's not a -- yeah, I do not only believe it,

10 09:27:1there are strong arguments for that.

11 09:27:1BY MR. LOVE:

12 09:27:1Q Suppose that a patent holder rejected an Orange

13 09:27:2Book offer that a license seeker had made and that

14 09:27:2later --

15 09:27:2A Who was?

16 09:27:2Q Sure. Let me start again.

17 09:27:2So we are talking about the first Orange Book,

18 09:27:3not the alternative procedure, but the straightforward

19 09:27:3Orange Book offer.

20 09:27:3A Yes.

21 09:27:3Q So suppose a patent holder rejects an Orange

22 09:27:3Book offer and then a German court finds that the

23 09:27:4royalty offer was so high that that rejection was an

24 09:27:4abuse of antitrust law.

25 09:27:4A Yes.



8/28




Page 45

1 09:51:2BY MR. LOVE:

2 09:51:2Q Which is higher, an offer for which the

309:51:3

rejection would be a violation of antitrust law or an

4 09:51:3offer for which the rejection would be an obvious

5 09:51:3violation of antitrust law?


7 09:51:3THE WITNESS: I would say it's the same. It's

8 09:51:4just a question of the standard of how you evaluate the

9 09:51:4facts. Obvious in the sense of you apply a standard of

10 09:51:5review which does not go into all details.

11 09:51:5BY MR. LOVE:

12 09:51:5Q Would you agree that the standard for

13 09:52:0evaluating an offer under the Orange Book procedure is

14 09:52:0uncertain in German law?

15 09:52:0A I wouldn't agree. There's a very clear-cut

16 09:52:0procedure which has been developed by the German Federal

17 09:52:1Supreme Court and has been further clarified by the

18 09:52:1lower courts.

19 09:52:1Q We were discussing the second alternative

20 09:52:1procedure --

21 09:52:1A Yes.

22 09:52:1Q -- and you said there are no reported decisions

23 09:52:2explaining how the second alternative procedure works;

24 09:52:2correct?

25 09:52:2A I said there's none been reported, apart from



9/28


10/28




Page 47

1 09:53:4require the license seeker to drop its non-infringement

2 09:53:4defenses?

309:53:4

MS. BERRY: Objection; form.

4 09:53:4THE WITNESS: Is it favorable to?

5 09:53:4BY MR. LOVE:

6 09:53:4Q Is it favorable to the patent holder to require

7 09:53:5the license seeker to drop all of its non-infringement

8 09:53:5defenses?

9 09:53:5A It's favorable. It's perfectly legitimate for

10 09:53:5the holder of exclusive right to only license or to only

11 09:54:0negotiate with people who don't want to attack his

12 09:54:0right, but it's certainly favorable, yes.

13 09:54:1Q Here in Seattle, in this case, Judge Robart

14 09:54:2found that the RAND royalty for Motorola's worldwide

15 09:54:2H.264 portfolio with respect to Microsoft's products was

16 09:54:20.555 cents per unit.

17 09:54:3Were you aware of that?

18 09:54:3A No.

19 09:54:3Q Do you have any basis to disagree with that

20 09:54:3finding?

21 09:54:3A I have no facts whatsoever either to disagree

22 09:54:3or to agree. I have no opinion on that.

23 09:54:4Q Since you weren't aware of it, I'll assume the

24 09:54:4answer is no, but I'm going to ask anyway.

25 09:54:5Do you understand that Judge Robart found that



11/28




Page 53

1 10:00:2eurocent?


310:00:3

THE WITNESS: I'm not -- I'm not -- I have no

4 10:00:3opinion on that as I don't know the details.

5 10:00:3BY MR. LOVE:

6 10:00:3Q Microsoft's Orange Book offer that was rejected

7 10:00:3was 2 eurocents, so if Microsoft had offered half a

8 10:00:4eurocent, would it have been able to avoid an

9 10:00:4injunction?

10 10:00:4A If it's less than what has been given here,

11 10:00:4it's rather unlikely.

12 10:00:5Q Rather unlikely, or no?

13 10:00:5A If it's lower than what has been -- well, the

14 10:00:5court said -- the Mannheim Court said what has been

15 10:00:5offered is so low that the rejection is not -- is not a

16 10:01:0breach of antitrust law as it is conceivable that the

17 10:01:1rate has to be higher.

18 10:01:1So if the rate would have been lower, it is --

19 10:01:2I cannot second-guess what the court would have said,

20 10:01:2but it's -- it's pure logic that if it's lower, I assume

21 10:01:2that also the same standard would have been applied, and

22 10:01:2the same standard would have taught that the rejection

23 10:01:3of such an offer is a violation of European antitrust

24 10:01:3law.

25 10:01:3Q If Microsoft had escrowed a sufficient amount



12/28




Page 54

1 10:01:3of money and had allowed Motorola or the German Court to

2 10:01:4decide about an equitable license fee, would Microsoft

310:01:4

have been enjoined?

4 10:01:4A If it had followed the second procedure, the

5 10:01:5315 procedure, it would have not been enjoined.

6 10:01:5Q How much money would have been sufficient for

7 10:01:5Microsoft to avoid an injunction?


9 10:02:0THE WITNESS: As this is a difficult

10 10:02:0evaluation, taking into account all specifics of the

11 10:02:0case, I'm not able to give you any -- any numbers there.

12 10:02:1MR. LOVE: We have been going for about an

13 10:02:1hour. Why don't we take a break.

14 10:02:1THE VIDEOGRAPHER: Off the record at 10:01.

15 10:02:1(Recess taken.)

16 10:21:0THE VIDEOGRAPHER: Back on the record at 10:20.

17 10:21:0BY MR. LOVE:

18 10:21:0Q Before we took a break, I had asked you a

19 10:21:0question earlier about if the parties in a German patent

20 10:21:0infringement suit agree on a license fee, and I was

21 10:21:1asking you what they would do, and I don't want to

22 10:21:1restate your testimony, but part of your response, as I

23 10:21:1understood it, was, there are other terms besides a

24 10:21:2license fee that the parties would need to agree on.

25 10:21:2Do you remember this question?



13/28




Page 56

1 10:22:5be license fee, the license product, a rendering of

2 10:22:5account, if the -- the -- the patent as been made use of

310:23:0

before, so these are the elements which have been --

4 10:23:0have been decided about by the court. If further issues

5 10:23:1have to be included in such a License Agreement or not

6 10:23:1is pure speculation, I have no opinion on that.

7 10:23:2Q Okay. Let's go back to what happened in

8 10:23:3Mannheim.

9 10:23:3If Microsoft had followed the second

10 10:23:3alternative of the Orange Book procedure, Motorola would

11 10:23:3have set a higher royalty than the 1 to 2 eurocents that

12 10:23:3Microsoft had offered; correct?


14 10:23:4THE WITNESS: I have no opinion on that.

15 10:23:4BY MR. LOVE:

16 10:23:4Q Why would Motorola have set a lower royalty?

17 10:23:4A I am not aware of -- the business evaluations,

18 10:23:5which are behind such an offer, are not -- have not come

19 10:23:5to my attention. I -- I can only speculate, but, of

20 10:23:5course, we can assume that.

21 10:24:0Q If Microsoft had challenged the rate set by

22 10:24:0Motorola by bringing a separate proceeding later and the

23 10:24:0court set the royalty, the royalty set by the court

24 10:24:1would also be higher than a -- than the 1 to 2 eurocents

25 10:24:1that Microsoft had offered; correct?



14/28




Page 57


2 10:24:1THE WITNESS: This is -- this is speculation

310:24:2

because you apply a different standard of -- there of

4 10:24:2assessing the -- the license fee, and as you hear

5 10:24:3evidence and as further circumstances will be looked

6 10:24:3upon and be considered by the court, it -- it's just a

7 10:24:4different way of assessing. It can be that it's higher.

8 10:24:4It can even be -- if the evidence is such that points in

9 10:24:5this direction might even be lower. It's just a new

10 10:24:5story then, and it will be assessed independently, and

11 10:24:5the court will -- will find what is the adequate and --

12 10:25:0and FRAND and entered as conformed license fee. It can

13 10:25:0be higher. It could even be lower. It can be the same.

14 10:25:1I -- I cannot say. This is speculation. But, again,

15 10:25:1the -- the standards, which are used to determine the

16 10:25:1license fee, they are the relevant thing, and they take

17 10:25:2into account the standards. This might lead to one --

18 10:25:2to one result or to the other.

19 10:25:2BY MR. LOVE:

20 10:25:3Q When we talked earlier about the second

21 10:25:3alternative, I thought I understood your position to be

22 10:25:3that the same standard would be used to evaluate and

23 10:25:4determine a correct license fee. It's a license fee

24 10:25:4that is not objectionable --

25 10:25:4A Yes.



15/28




Page 58

1 10:25:4Q -- under antitrust laws.

2 10:25:4A Yes.

310:25:4

Q So if the court is setting a royalty, it's

4 10:25:5going to set a royalty that is not objectionable under

5 10:25:5antitrust law; correct?

6 10:25:5A Yes.

7 10:25:5Q The Mannheim Court said that Motorola's

8 10:26:0rejection of the 1-to-2-eurocent offer was not

9 10:26:0objectionable under antitrust law; right?

10 10:26:1A Can you repeat, please.

11 10:26:1Q Sure.

12 10:26:1Microsoft offered 1 to 2 eurocents. Motorola

13 10:26:1rejected it, and the Mannheim Court said that rejection

14 10:26:2did not violate antitrust law.

15 10:26:2A Yes, that's correct.

16 10:26:2Q But you said just now that in a later

17 10:26:2proceeding, if a court is setting the rate, it might set

18 10:26:3a rate lower than what Microsoft offered.

19 10:26:3A It's -- it's speculation, and it also is a

20 10:26:3question of the German law of civil procedure and

21 10:26:4evidence. You know, in the -- in the first proceeding

22 10:26:4the courts will also assess what has been written in the

23 10:26:4briefs without taking evidence, and so they will make

24 10:26:5their -- they will form their opinion on what has been

25 10:26:5written and submitted by the parties.



16/28




Page 59

1 10:26:5In a second -- the second case of the rate

2 10:27:0setting procedure, all evidence, all economic

310:27:0

specialists may or may not be presented to the court,

4 10:27:1and the court will just have a very different basis to

5 10:27:1found its -- its -- for founding its opinion -- for

6 10:27:2forming its opinion, and it's -- it is possible that

7 10:27:2it's higher. It is maybe, well, possible, but it's

8 10:27:2speculation, but as there is another -- different

9 10:27:3standard of how the facts are evaluated, it may even be

10 10:27:3lower, but, again, this is pure speculation.

11 10:27:3The only thing I want to say, this is a

12 10:27:4completely new story where all facts are assessed newly,

13 10:27:4and then the court will -- will find it -- will have its

14 10:27:5decision -- will render its decision on the basis of the

15 10:27:5facts which it has evaluated according to the law of

16 10:27:5civil procedure in this second proceeding.

17 10:28:0Q So the court, in the second proceeding, would

18 10:28:0apply the same standard, but it might reach a different

19 10:28:0result because it considers more evidence; is that

20 10:28:1correct?

21 10:28:1A It's just a different standard of review, a

22 10:28:1different standard of review of the first -- the review

23 10:28:1you have in your first -- in the first -- in the first

24 10:28:2road, that it's the -- the question whether or not it is

25 10:28:2obvious. So the idea is you have a -- you look into the



17/28




Page 60

1 10:28:3briefs, you evaluate what the parties have said, and you

2 10:28:3form your opinion by not going into -- especially by not

310:28:3

taking evidence, so this is maybe specific to German

4 10:28:4law.

5 10:28:4In the second proceeding, the proceeding will

6 10:28:4be a full-fledged proceeding, and the full-fledged

7 10:28:4proceeding will be more facts; more evidence will be

8 10:28:5assessed. For example, if you take a preliminary

9 10:28:5injunction, you also have a different standard of -- of

10 10:28:5evidence, which is lower than in -- in a full

11 10:29:0proceeding. And so it's just a different way of

12 10:29:0assessing facts and -- and hearing evidence or not

13 10:29:1hearing evidence.

14 10:29:1Q So I want to make sure I understand your

15 10:29:1position on what would have happened under the Orange

16 10:29:2Book. So this will be sort of a long question. I'll

17 10:29:2ask you a couple things, and just stop me if anything

18 10:29:2doesn't make sense.

19 10:29:2Under the Orange Book procedure, as I

20 10:29:2understand it, there are three paths for Microsoft to

21 10:29:3avoid an injunction by agreeing to pay a royalty.

22 10:29:3First, Microsoft could have made an Orange Book

23 10:29:3offer that Motorola accepted; correct?

24 10:29:4Second, Microsoft could have let Motorola set a

25 10:29:4royalty; correct?



18/28




Page 61

1 10:29:4A Yes.

2 10:29:4Q And last, Microsoft could have challenged the

310:29:5

rate that was set by Motorola, in which case a court, in

4 10:29:5a separate proceeding, may set a different royalty;

5 10:29:5correct?

6 10:29:5A Can you repeat the question?

7 10:30:0Q Sure.

8 10:30:0So the -- the third path --

9 10:30:0A Yes.

10 10:30:0Q -- would be Motorola sets a royalty. Microsoft

11 10:30:0challenges the royalty in a separate proceeding, and as

12 10:30:0part of that proceeding, the court finds that Motorola's

13 10:30:1royalty is -- is too high and sets a -- sets the royalty

14 10:30:1itself.

15 10:30:1A That's correct.

16 10:30:1MS. BERRY: Objection to form.

17 10:30:2BY MR. LOVE:

18 10:30:2Q For the first option, if Microsoft made an

19 10:30:2Orange Book offer, you don't know what Mo- -- what offer

20 10:30:2Motorola would have accepted; correct?

21 10:30:2A Pure speculation.

22 10:30:2Q For the second option, you don't know what

23 10:30:3royalty Motorola would have set, do you?

24 10:30:3A Of course not, no.

25 10:30:3Q And on the third option, you don't know what



19/28




Page 62

1 10:30:4royalty a court would set?

2 10:30:4A I can only say what the basis for a court

310:30:4

decision would be. But as I don't know all the relevant

4 10:30:5facts and as I didn't hear all the evidence, which would

5 10:30:5come into play, of course I cannot give a -- give you a

6 10:30:5number, certainly not.

7 10:30:5Q So in November of 2012, there was a trial, as

8 10:31:0part of this case, to determine a RAND royalty for

9 10:31:0Motorola's patents.

10 10:31:0Are you aware of that?

11 10:31:0A No.


13 10:31:0BY MR. LOVE:

14 10:31:1Q So I'll represent to you that at that trial,

15 10:31:1there was expert testimony from technical experts and

16 10:31:1economic experts about the appropriate RAND royalty, but

17 10:31:2you haven't reviewed the transcript of that trial;

18 10:31:2correct?

19 10:31:2A No, I haven't reviewed it.

20 10:31:2Q So you don't know whether the evidence

21 10:31:2presented in the November 2000 trial -- 2012 trial in

22 10:31:3this case was in any way comparable to the evidence that

23 10:31:3would be considered by a German court that was setting a

24 10:31:3royalty?

25 10:31:3A I have no opinion on that.



20/28




Page 96

1 11:14:0MS. BERRY: Counsel, it's been about an hour,

2 11:14:0when you have a good time for a break.

311:14:1

MR. LOVE: Sure, we can take a break.

4 11:14:1THE VIDEOGRAPHER: This concludes Video 2,

5 11:14:1Volume 1 in the deposition of Maximilian Haedicke.

6 11:14:1Going off the record, the time is 11:14.

7 11:15:5(Recess taken.)

8 11:37:3THE VIDEOGRAPHER: This begins Video 2,

9 11:37:3Volume 1 in the deposition of Maximilian Haedicke.

10 11:37:3Going back on the record, it's 11:37.

11 11:37:3BY MR. LOVE:

12 11:37:4Q You are a judge in the patent division of the

13 11:37:4Dusseldorf Court of Appeals; is that correct?

14 11:37:4A Yes.

15 11:37:4Q What is the relationship between that court and

16 11:37:4the Regional Court of Dusseldorf?

17 11:37:5A It's the Court of Appeal for the Regional

18 11:37:5Court.

19 11:37:5Q Okay.

20 11:37:5(Exhibit 6 was marked for identification by the

21 11:37:5Court Reporter.)

22 11:37:5MR. LOVE: I've marked, as Exhibit 6, a

23 11:37:5translation of a March 21st, 2013 decision for the

24 11:38:0Regional Court of Dusseldorf.

25 11:38:1Q Are you familiar with this decision?



21/28




Page 97

1 11:38:1A Yes.

2 11:38:1Q Have you read it before?

311:38:1

A Yes.

4 11:38:1Q On the first few pages, there are some

5 11:38:1questions that are numbered 1 through 5.

6 11:38:2A Yes.

7 11:38:2Q These are questions that the Dusseldorf court

8 11:38:2is submitting to the European Court of Justice; is that

9 11:38:2correct?

10 11:38:2A Yes.

11 11:38:2Q Why is a German court asking the European Court

12 11:38:3of Justices what to do about standard essential patents?

13 11:38:3A Because this is a matter of European law, and

14 11:38:4if a German court applies European law, such as European

15 11:38:4antitrust law, it is obliged to -- to do this in

16 11:38:5accordance with European law, and so if a German court

17 11:38:5does -- has doubts as to how to interpret European

18 11:39:0antitrust law, it can -- or the highest instance is

19 11:39:0obliged to ask for a preliminary judgment of the

20 11:39:1European Court of Justice, so the European Court of

21 11:39:1Justices can give guidance as to how to interpret a -- a

22 11:39:2provision of European law.

23 11:39:2Q Let's take a look at Question 1. So at the --

24 11:39:2it's on the first page, and what the court asks is, "Is

25 11:39:3the holder of a standard-essential patent who has



22/28




Page 98

1 11:39:3declared to a standardization organization his

2 11:39:3willingness to grant a license to any third party under

311:39:4

fair, reasonable, and non-discriminatory terms abusing

4 11:39:4his dominant position if he brings an injunction claim

5 11:39:4in court against a patent infringer even though the

6 11:39:4patent infringer has declared his willingness to

7 11:39:5negotiate such a license," then there's an "or," and the

8 11:39:5second part is, "is an abuse of the dominant position to

9 11:39:5be assumed only if the patent infringer has presented

10 11:40:0the holder of the standard-essential patent an

11 11:40:0acceptable unconditional offer to enter into a license

12 11:40:0agreement, which the patent holder may not refuse

13 11:40:1without unfairly impeding the patent infringer or

14 11:40:1violating the ban on discrimination, and the patent

15 11:40:1infringer is satisfying his contractual obligations in

16 11:40:1anticipation of the license to be granted for prior

17 11:40:2use?"

18 11:40:2Did you see that?

19 11:40:2A Yes.

20 11:40:2Q Is it correct that what the Dusseldorf court is

21 11:40:2asking is whether the proper analysis is that set forth

22 11:40:3by the European Commission which involves a willing

23 11:40:3licensee, or is the Orange Book process satisfactory?

24 11:40:4Is that what this question is asking?

25 11:40:4A Basically, yes. However, if you read the



23/28




Page 99

1 11:40:4context and the entire judgment, the entire judgment

2 11:40:5here, there's a clear bias of the Dusseldorf court in

311:40:5

order -- in favor of the Orange Book proceeding, and

4 11:41:0this questions are -- are asked in order to pose -- to

5 11:41:0show the contrast between the approach of the Euro

6 11:41:1Commission of its press release of -- of December 21st

7 11:41:1and the -- the Orange Book proceeding, so it shows

8 11:41:2differences, and further on in the text, criticizes some

9 11:41:2of the approaches of the European Commission. So the

10 11:41:3term "willingness to negotiate" comes from this state

11 11:41:3press release.

12 11:41:3Q Would it be accurate to say the Dusseldorf

13 11:41:4court is uncertain whether the Orange Book procedure

14 11:41:4satisfies the European antitrust law?


16 11:41:4THE WITNESS: I'm not a member of the

17 11:41:5Dusseldorf lower court, so I cannot say that, but I

18 11:41:5don't understand it this way. I understand the judgment

19 11:41:5in such a way that it wants to get -- it wants to defend

20 11:41:5the Orange Book procedure towards the -- this very

21 11:42:0lenient approach of the European Commission.

22 11:42:1BY MR. LOVE:

23 11:42:1Q The European Court of Justice could respond to

24 11:42:1this question by saying that the Commission is right and

25 11:42:1the Dusseldorf court is wrong; right?



24/28




Page 100

1 11:42:2A Yes.

2 11:42:2Q Okay.

311:42:2

(Exhibit 7 was marked for identification by the

4 11:42:2Court Reporter.)

5 11:42:2MR. LOVE: I'm going to hand you what's been

6 11:42:2marked as Exhibit 7. Exhibit 7 is a document bearing

7 11:42:3the Bates stamp MS-MOTO_1823_00002271028.

8 11:42:4Q Have you read this document before?

9 11:42:4A No.

10 11:42:4Q How did you familiarize yourself with the

11 11:42:5history of the General Instrument versus Microsoft cases

12 11:42:5in Mannheim?

13 11:42:5A Some -- can you repeat the question.

14 11:42:5Q Sure.

15 11:42:5How did you -- in preparing to file your expert

16 11:43:0report, how did you familiarize yourself with the

17 11:43:0proceedings in Mannheim between General Instrument and

18 11:43:0Microsoft?

19 11:43:0A Well, the -- the decision is in public -- is

20 11:43:1publicly available, and the documents which I -- which I

21 11:43:1mention in my expert report have been produced to me.

22 11:43:2Q But you haven't seen this document, the

23 11:43:2Declaration of Professor David J. Teece?

24 11:43:2A No. No.

25 11:43:2Q You can put that aside.



25/28




Page 105

1 11:47:3not to answer.

2 11:47:3BY MR. LOVE:

311:47:4

Q Will you follow your counsel's advice?

4 11:47:4A Yes.

5 11:47:4Q The European Commission's preliminary view is

6 11:47:4that enforcing injunctions on standard essential patents

7 11:47:4against a willing licensee is an abuse of antitrust law;

8 11:47:5is that correct?


10 11:47:5THE WITNESS: Please repeat.

11 11:47:5MR. LOVE: Sure.

12 11:47:5Q The European Commission's preliminary view is

13 11:48:0that enforcing injunctions on standard essential patents

14 11:48:0against a willing licensee is an abuse of antitrust law;

15 11:48:0correct?

16 11:48:0A These are the wordings used, yes.

17 11:48:0Q Would you agree that Judge Robart in the

18 11:48:1Ninth Circuit helped Motorola avoid exposing itself to

19 11:48:1additional antitrust liability?

20 11:48:1MS. BERRY: Objection to form, outside the

21 11:48:1scope of his expert report.

22 11:48:2THE WITNESS: I have no sufficient information.

23 11:48:2I have no opinion as it relates to the U.S. trial.

24 11:48:2BY MR. LOVE:

25 11:48:2Q Do you understand that the decision to relocate



26/28




Page 106

1 11:48:2Microsoft's distribution center in Germany required

2 11:48:3considerable preparation beginning in January of 2012?

311:48:3

MS. BERRY: Objection; form, outside the scope

4 11:48:3of his expert report.

5 11:48:3THE WITNESS: I have no opinion on that.

6 11:48:4BY MR. LOVE:

7 11:48:4Q Are you aware of any of the details surrounding

8 11:48:4Microsoft's decision to relocate its German facility?

9 11:48:4A No.

10 11:48:4Q Did you review any documents associated with

11 11:48:4the move?

12 11:48:4A No.

13 11:48:4Q Did you review the deposition transcripts of

14 11:48:5the Microsoft employees who described that process?

15 11:48:5A No.

16 11:48:5Q Were you aware that Microsoft made its decision

17 11:48:5and had begun implementing the relocation out of Germany

18 11:49:0in March of 2012?

19 11:49:0A No.

20 11:49:0Q If Motorola had enforced the injunction in

21 11:49:1Mannheim, could Microsoft have continued to distribute

22 11:49:1H.264-compliant products in Germany?

23 11:49:1A If they fall under the patent and if there has

24 11:49:2been an injunction, no.

25 11:49:2Q If Motorola had enforced its injunction in



27/28




Page 121

1 I declare under penalty of perjury that the

2 foregoing is true and correct. Subscribed at

3 _______________, California, this _____ day of

4 _______________, 2013.

5

6 ____________________________

7 Signature of the witness

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25



28/28


Page 122

1 CERTIFICATE OF REPORTER

2 I, RACHEL FERRIER, a Certified Shorthand

3 Reporter, hereby certify that the witness in the

4 foregoing deposition was by me duly sworn to tell the

5 truth, the whole truth, and nothing but the truth in the

6 within-entitled cause;

7 That said deposition was taken down in

8 shorthand by me, a disinterested person, at the time and

9 place therein stated, and that the testimony was

10 thereafter reduced to typewriting by computer under my

11 direction and supervision and is a true record of the

12 testimony given by the witness;

13 That before completion of the deposition,

14 review of the transcript [X] was [ ] was not requested.

15 If requested, any changes made by the deponent (and

16 provided to the reporter) during the period allowed are

17 appended hereto.

18 I further certify that I am not of counsel or

19 attorney for either or any of the parties to the said

20 deposition, nor in any way interested in the event of

21 this cause, and that I am not related to any of the

22 parties thereto.

23 DATED:

24

_____________________________

25 RACHEL FERRIER, CSR No. 6948


Excerpts From Transcript of Haedicke Testimony Recorded on 13-06-14

Documents

Transcript of Excerpts From Transcript of Haedicke Testimony Recorded on 13-06-14