United States District Court, E.D. Texas, Sherman Division
HUAWEI TECHNOLOGIES CO., LTD., and FUTUREWEI TECHNOLOGIES, INC.,
YIREN RONNIE HUANG, and CNEX LABS, INC.
MEMORANDUM OPINION AND ORDER
L. MAZZANT, UNITED STATES DISTRICT JUDGE.
before the Court is Plaintiffs' Motion to Strike the
Expert Reports and Testimony of Keith R. Ugone, PH.D.
Regarding Damages (Dkt. #260). The Court, having considered
the pleadings, reports, and relevant briefings, finds that
the motion should be denied.
Huawei Technologies Co., Ltd. (“Huawei”) is a
multinational networking and telecommunications equipment and
services company headquartered in China. Plaintiff Futurewei
Technologies, Inc. (“Futurewei”) is a subsidiary
of Huawei with several offices throughout the United States,
including Plano, Texas. In December 2010, Futurewei offered
Defendant Yiren “Ronnie” Huang
(“Huang”) employment as a Principal Engineer for
its solid-state drive (“SSD”) storage group, to
assist in development and implementation of Advance Computing
Network (“ACN”), non-volatile memory express
(“NVMe”), and SSD technology. Huang accepted the
offer in January 2011. The Employment Agreement contained
provisions relating to non-disclosure, assignment, and
on Huang's job responsibilities, Plaintiffs contend that
Huang had access to confidential, proprietary, and trade
secret information. On May 31, 2013, Huang ended his
employment with Futurewei. On June 3, 2013, Huang, along with
others, incorporated CNEX Labs, Inc. (“CNEX”), a
Delaware Corporation with its principal place of business in
California. Plaintiffs allege, among other things, that Huang
incorporated CNEX to compete directly with Plaintiffs; Huang
is using Plaintiffs' confidential, proprietary, and trade
secret information to develop and improve SSD technology and
NVMe related technology for CNEX; and further that Huang and
CNEX are improperly soliciting employees away from
Plaintiffs. Additionally, Plaintiffs allege that Huang
started to engage in this behavior informally prior to
leaving Futurewei. Plaintiffs further contend that Huang and
CNEX began filing patent applications in June 2013, using the
information that Huang obtained through his employment with
March 11, 2019, Plaintiffs filed a Motion to Strike the
Expert Reports and Testimony of Keith R. Ugone, PH.D.
Regarding Damages (Dkt. #260). On March 26, 2019, Defendant
CNEX filed a response (Dkt. #276). On April 4, 2019,
Plaintiffs filed a reply (Dkt. #288). On April 9, 2019,
Defendant CNEX filed a sur-reply (Dkt. #304).
Rule of Evidence 702 provides for the admission of expert
testimony that assists the trier of fact to understand the
evidence or to determine a fact in issue. Fed.R.Evid. 702. In
Daubert v. Merrell Dow Pharmaceuticals, Inc., the
Supreme Court instructed courts to function as gatekeepers,
and determine whether expert testimony should be presented to
the jury. 509 U.S. 579, 590-93 (1993). Courts act as
gatekeepers of expert testimony “to make certain that
an expert, whether basing testimony upon professional studies
or personal experience, employs in the courtroom the same
level of intellectual rigor that characterizes the practice
of an expert in the relevant field.” Kuhmo Tire Co.
v. Carmichael, 526 U.S. 137, 152 (1999).
party offering the expert's testimony has the burden to
prove that: (1) the expert is qualified; (2) the testimony is
relevant to an issue in the case; and (3) the testimony is
reliable. Daubert, 509 U.S. at 590-91. A proffered
expert witness is qualified to testify by virtue of his or
her “knowledge, skill, experience, training, or
education.” Fed.R.Evid. 702. Moreover, to be
admissible, expert testimony must be “not only relevant
but reliable.” Daubert, 509 U.S. at 589.
“This gate-keeping obligation applies to all types of
expert testimony, not just scientific testimony.”
Pipitone v. Biomatrix, Inc., 288 F.3d 239, 244 (5th
Cir. 2002) (citing Kuhmo, 526 U.S. at 147).
deciding whether to admit or exclude expert testimony, the
Court should consider numerous factors. Daubert, 509
U.S. at 594. In Daubert, the Supreme Court offered
the following, non-exclusive list of factors that courts may
use when evaluating the reliability of expert testimony: (1)
whether the expert's theory or technique can be or has
been tested; (2) whether the theory or technique has been
subjected to peer review and publication; (3) the known or
potential rate of error of the challenged method; and (4)
whether the theory or technique is generally accepted in the
relevant scientific community. Id. at 593-94;
Pipitone, 288 F.3d at 244. When evaluating
Daubert challenges, courts focus “on [the
experts'] principles and methodology, not on the
conclusions that [the experts] generate.”
Daubert, 509 U.S. at 595.
Daubert factors are not “a definitive
checklist or test.” Id. at 593. As the Supreme
Court has emphasized, the Daubert framework is
“a flexible one.” Id. at 594. The test
for determining reliability can adapt to the particular
circumstances underlying the testimony at issue.
Kuhmo, 526 U.S. at 152. Accordingly, the decision to
allow or exclude experts from testifying under
Daubert is committed to the sound discretion of the
district court. St. Martin v. Mobil Expl. & Producing
U.S., Inc., 224 F.3d 402, 405 (5th Cir. 2000) (citations
designated Keith R. Ugone, PH.D. as an expert on damages.
Plaintiffs request that the court exclude Dr. Ugone's
affirmative report (the “Ugone CC Report”) and
his rebuttal report (the “Ugone's RB Report”)
in their entirety and prohibit Dr. Ugone from testifying in
connection with Defendants' counterclaims against
Plaintiffs or in rebuttal to the testimony of Plaintiffs'