Plaintiff Wireless Alliance, LLC (“Plaintiff” or “Wireless Alliance”) brought allegations against Defendants AT&T Mobility LLC, AT&T Services, Inc., and AT&T Corp. (“Defendants” or “AT&T”). Wireless Alliance asserted that AT&T infringed on several United States patents concerning enhancements to cellular networking systems. The patents in question include United States Patent No. 9,144,106 (the “‘106 patent”), Patent No. 9,565,662 (the “‘662 patent”), and Patent No. 10,045,383 (the “‘383 patent”), collectively referred to as the “Asserted Patents.” Wireless Alliance holds exclusive licensing rights for the ‘106 and ‘662 patents and owns the ‘383 patent through assignment.
Defendants filed a motion to strike the testimony of Wireless Alliance’s damages expert, Jim W. Bergman.
Intellectual Property Expert Witness
Jim W. Bergman, the Founder and President of Bergman Consulting, held a B.A. in Economics and an M.B.A. from the University of California at Irvine, along with a Chartered Financial Analyst (CFA) designation. He pursued a Master of Computer Science degree from the Georgia Institute of Technology.
Before establishing Bergman Consulting in 2017, he led Conway MacKenzie’s national intellectual property litigation group and worked as an in-house economic consultant for various national law firms for over a decade. With nearly ten years of experience in the information technology sector, Bergman obtained multiple industry-recognized certifications in hardware, software, and networking.
He specialized in intellectual property, commercial, and bankruptcy litigation, serving as a testifying or consulting expert in areas such as business litigation, patent and technology issues, trade secrets, trademarks, securities litigation, business valuation, bankruptcy reorganization, solvency, and general damages.
Discussion by the Court
A. Switiching Royalty Bases
Defendants contended that Bergman improperly switched royalty bases by deriving a per-patent family device rate for Ericsson’s portfolio and applying it to the service revenues of the carriers. They argued that this methodology contradicted Federal Circuit precedent, as the royalty should depend on whether the Defendant manufactured the device or was the end user. The carriers maintained that no carrier would pay a royalty based on Ericsson’s cellphone or infrastructure rates based on the carrier subscriber revenue. However, the Court found that Defendants did not provide sufficient grounds to strike Bergman’s report under Rule 702 and Daubert. The Court determined that Defendants’ concerns highlighted credibility disputes rather than issues of reliability.
B. Entire Market Value Rule and Apportionment
Defendants further sought to strike Bergman’s report, alleging that he improperly used the entirety of their subscriber revenue, raising concerns that the Plaintiff aimed to present large revenue numbers to influence the jury’s perception of damages. However, the Parties had already agreed to a motion in limine addressing this concern. Defendants also argued that Bergman misapplied the Entire Market Value Rule (EMVR) without adequate support. In response, the Plaintiff asserted that Bergman conducted multiple patent- and Defendant-specific analyses, supported by technical opinions, to calculate apportionment factors for the incremental value of the infringing features over non-infringing features. And based on that, apportioned the revenue from the allegedly infringing features and thus did not implicate the EMVR. The Court was satisfied that Bergman’s approach did not invoke the EMVR. What remains is a fact issue.
C. Unreliable Patent Rates
Additionally, Defendants argued that Bergman made two methodological errors: first, by improperly applying essentiality studies of declared patents to charted patent families, and second, by basing his reliance on a certain claim that the top 10% of patents in a portfolio drive 84% of the value. They also pointed out inconsistent statements from the Plaintiff’s other expert. In contrast, Plaintiff contested Defendants’ view, asserting that Bergman used the claim in question only in the final step to differentiate apportionment rates between high-value and lower-value patents. The Court allowed Defendants to cross-examine Bergman regarding potentially inconsistent statements but found no basis to strike his testimony.
Legal Standards
An expert witness may provide opinion testimony if “(a) the expert’s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue; (b) the testimony is based on sufficient facts or data; (c) the testimony is the product of reliable principles and methods; and (d) the expert has reliably applied the principles and methods to the facts of the case.”
Importantly, in a jury trial setting, the Court’s role under Daubert is not to weigh the expert testimony to the point of supplanting the jury’s fact-finding role; instead, the Court’s role is limited to that of a gatekeeper, ensuring that the evidence in dispute is at least sufficiently reliable and relevant to the issue before the jury that it is appropriate for the jury’s consideration
Held
The Court denied Defendants’ motion to strike the testimony of Plaintiff Wireless Alliance LLC’s damages expert, Jim W. Bergman.
Key Takeaways:
The Court upheld Bergman’s methodology when Defendants argued he improperly switched royalty bases, declaring it to be insufficient grounds for exclusion. It rejected concerns that his use of subscriber revenue aimed to unduly influence the jury’s perception of damages, noting this issue had been addressed in a prior motion in limine. While Defendants claimed Bergman misapplied the Entire Market Value Rule (EMVR), the Court determined he conducted adequate analyses to support his calculation of the apportionment factors.
Please refer to the blog previously published about this case:
Telecommunications Expert Witness’ Opinions Regarding 3GPP Availability Admitted
Case Details:
| Case Caption: | Wireless All., LLC v. AT&T Mobility LLC |
| Docket Number: | 2:23cv95 |
| Court: | United States District Court, Texas Eastern |
| Order date: | October 24, 2024 |
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