Paramount Pictures Corporation v. ReplayTV, Inc., Joint Stipulation ...

123456789101112131415161718192021222324252627282. Documents and Information about Licensing by Defendants.Another way in which Defendants may enjoy a financial benefit from theinfringing conduct at issue here is by licensing the infringing technology at issue tothird parties. Defendants have repeatedly said that they do indeed plan to market toother firms, such as large consumer electronics manufacturers or cable or satellitecompanies, the right to use various technologies they have developed, including theReplayTV 4000. 60/ Nevertheless, in response to Plaintiffs’ discovery requests,Defendants have offered to produce only actual, consummated licenses -- of whichthey claim there are none at present. But if Defendants are trying to license thosetechnologies, or have plans to do so, those facts, and the documents related to them,are plainly discoverable. Absent such discovery, even if Defendants are engagingin serious negotiations with a large consumer electronics manufacturer to be paidtens of millions of dollars for the right to license Defendants’ “ Send Show” feature,Defendants would be permitted to conceal those facts (and the related documents)from Plaintiffs and the Court. 61/Defendants’ licensing efforts -- even efforts that have not yet come to fruition-- are relevant for at least two other reasons as well. First, Defendants’ statementsto potential licensees about the ReplayTV 4000 may contain important admissions60/See, e.g., Richard Cole, No Pause in the Battle Between PVR Makers, CableWorld, Feb. 11, 2002, available at 2002 WL 9607048 (quoting ReplayTVexecutive that defendants are “ in discussions with every major cable company”about incorporating defendants’ DVR technology in set-top boxes); SONICblue,SONICblue Licenses ReplayTV Software and Hardware To Support Rollout ofDotcast Digital Network TM (Sept. 19, 2001), at www.sonicblue.com/company/press.asp?ID=496 (“ ReplayTV technologies are available for license tomanufacturers of set-top boxes, DVRs, home-media servers and networkedentertainmentappliances.” ).61/As the Napster case makes clear, a defendant need not enjoy currentrevenues in order to obtain a financial benefit from infringements, so long as theinfringements help the defendants’ efforts to obtain future revenues. See Napster,239 F.3d at 1023 (“ Ample evidence supports the district court’ s finding thatNapster’ s future revenue is directly dependent upon increases in userbase.” )(internal quotations omitted).76