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XY, LLC v. Trans Ova Genetics, LC

United States District Court, D. Colorado

January 7, 2016

XY, LLC, Plaintiff / Counterclaim Defendant,
TRANS OVA GENETICS, LC, Defendant / Counterclaim Plaintiff.


William J. Martínez United States District Judge

Plaintiff XY, LLC (“XY”) brings this case against Defendant Trans Ova Genetics, LC (“Trans Ova”), arising from disputes over a License Agreement which had permitted Trans Ova to use XY’s patented technology. XY brings claims for breach of contract and patent infringement, and Trans Ova counterclaims for breach of contract and breach of the covenant of good faith and fair dealing, as well as asserting various defenses. (See ECF No. 301.) This case is set for a three-week jury trial commencing on Monday, January 25, 2016, with the Final Trial Preparation Conference set for January 8, 2016. (ECF No. 314.)

This matter is before the Court on three pending Motions in Limine. (ECF Nos. 365, 367, 370). For the reasons set forth below, the parties’ Joint Motion to Grant Stipulated Motions in Limine (ECF No. 370) is granted, and the parties’ respective disputed Motions in Limine (ECF Nos. 365 & 367) are granted in part and denied in part.


XY[1] moves to exclude several different categories of evidence, which the Court will discuss in turn. (See ECF No. 367.)

A. ABS Global v. Inguran and Semex Alliance v. Elite Dairy Genomics

XY seeks to exclude evidence or argument related to two cases in other districts: ABS Global, Inc. v. Inguran, LLC, and Semex Alliance v. Elite Dairy Genomics, LLC. (Id. at 1.) XY argues that these two cases are irrelevant to the instant action, and to the extent they are at all relevant, they are excludable under Federal Rule of Evidence 403. (Id. at 1-3.)

As to ABS Global, which is a pending case in the Western District of Wisconsin, Trans Ova argues that it should be permitted to introduce evidence of ABS’s complaint against Inguran and one of its subsidiaries which alleges that the subsidiary used its market dominance to force ABS into an onerous long-term contract when it otherwise might have used individual purchase orders or at-will sales. (ECF No. 375 at 1-2.) Trans Ova argues that the ABS Global complaint demonstrates that, in the absence of a long-term contract requirement, “ABS would have engaged in business with a competitor that would have provided ABS with more favorable contracts-and that would have been Trans Ova, the only viable competitor at the time.” (Id. at 2.)

The Court agrees with XY’s assertion in its Motion that this argument is purely speculative. First, these allegations appear in a complaint in a pending case, and have not yet been determined to be true; ABS has not yet proven that it should not have been subjected to the challenged contract, and the issues raised in making the necessary proof may be completely unrelated to the facts of the instant case. Furthermore, even taking the allegations in the ABS Global complaint as fact, Trans Ova has no way of demonstrating that, if Inguran and its subsidiary had not forced ABS and their other licensees into long-term contracts, Trans Ova would have been the only possible competitor with which ABS would necessarily have done business. Instead, it is just as conceivable that, in the absence of such long-term contracts, other competitors might have arisen in the newly free-market bovine semen industry. In sum, the Court finds Trans Ova’s arguments unpersuasive and concludes that there is a high likelihood that introduction of evidence relating to ABS Global would be confusing, misleading, and a waste of time. As that risk substantially outweighs the evidence’s limited relevance, it is excluded under Rule 403.

As to Semex Alliance, a case in the Southern District of Ohio involving a dispute over the purchase of particular bulls, Trans Ova’s Response to XY’s Motion fails to make any argument opposing exclusion. (See ECF No. 375 at 1-2.) The Court deems XY’s Motion confessed as to Semex Alliance, which XY asserts is irrelevant to the instant litigation. Accordingly, evidence relating to Semex Alliance will also be excluded at trial.

B. Inter Partes Reviews of XY Patents

XY moves to preclude the introduction of evidence of Inter Partes Review proceedings before the Patent Trial and Appeal Board (“PTAB”) as to two of the patents-in-suit (the ’920 Patent and the ’425 Patent). (ECF No. 367 at 3-4.) XY argues that the PTAB’s decision to institute these proceedings, which are currently pending, indicates that the PTAB found the question of patent validity to be worthy of a full hearing, but that this is of limited relevance here because the PTAB applies a different claim construction analysis and standard of review than the one applied by this Court. (Id.)

Trans Ova argues that the Inter Partes Review proceedings are relevant to rebut XY’s claim that Trans Ova willfully infringed the patents, because they support Trans Ova’s position that it has a good faith belief that the patents are invalid. (ECF No. 375 at 2-3.) Trans Ova agrees that it will not introduce such evidence to support its claim of invalidity, but solely to mitigate against a finding of willfulness. (Id.)

The Court agrees that the evidence of the pending Inter Partes Review proceedings is relevant to willfulness, but finds that that relevance is substantially outweighed by the danger of undue prejudice, making this evidence excludable under Rule 403. See SSL Servs, LLC v. Citrix Sys., Inc., 769 F.3d 1073, 1092-93 (Fed. Cir. 2014) (affirming a district court’s exclusion of evidence of Patent and Trademark Office reexamination on 403 grounds, as “this court’s precedent has often warned of the limited value of actions by the PTO to establish a good faith belief of invalidity” (internal quotation marks omitted)). There is a substantial risk that the jury will give undue weight to evidence of a decision by a judicial body, even a preliminary decision by an administrative adjudicator, that evaluates the same invalidity question that the jury must decide. Given the limited probative value of the PTAB’s findings thus far, as well as the differing legal standards applied in the Inter Partes Review proceedings as compared to the instant case, it would be difficult, if not impossible, for a limiting instruction to sufficiently mitigate such prejudice.

Accordingly, the Court finds that the probative value of the Inter Partes Review evidence is substantially outweighed by the danger of unfair prejudice and misleading the jury, and therefore this evidence shall be excluded under Rule 403.

C. XY v. Hasler and Motion to Disqualify

XY seeks to exclude any evidence that it moved to disqualify former XY employee Dr. John F. Hasler from testifying as an expert for Trans Ova in this case, as well as evidence of a lawsuit XY brought against Dr. Hasler seeking to enjoin him from revealing allegedly privileged information. (ECF No. 367 at 4-5.) Trans Ova stipulates to exclude evidence of the lawsuit, and states that it would also agree to exclusion of evidence related to XY’s motion to disqualify if XY agrees not to impeach Dr. Hasler with evidence from his declarations attached to the motion. (ECF No. 375 at 3-4.) Trans Ova argues that it would be “patently unfair” to permit XY to impeach Dr. Hasler with motion-related documents while prohibiting Trans Ova from making reference to the motion to disqualify. (Id. at 4.)

The Court disagrees. Dr. Hasler’s prior statements may be used for impeachment purposes without reference to the underlying motion to disqualify or XY’s reasons for so moving. The same is not true of other, non-impeachment references to the motion to disqualify. As to the remainder of the evidence challenged here, the Court agrees that it would be unfairly prejudicial and confusing for the jury to receive evidence about the machinations of XY’s litigation over privilege and confidentiality when such issues have since been resolved. The Court is also persuaded by XY’s argument that a jury could assume that XY’s motion to disqualify Dr. Hasler, and its lawsuit against him to the same end, might signify XY’s attempt to silence Dr. Hasler, which would result in undue emphasis being placed on his testimony. (See ECF No. 367 at 5.)

As such, the Court finds that the evidence of XY’s lawsuit against Dr. Hasler and its motion to disqualify him shall be excluded under Rule 403, but Dr. Hasler may be impeached with prior statements he made in relation to the motion to disqualify. Should Dr. Hasler or counsel need to refer to the context of the statements in the course of impeachment or rehabilitation, they may refer generically to the statements having been made in ...

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