Saturday, December 1, 2012

Apple and Samsung disagree on relevance of HTC agreement and related briefing process

The fight between Apple and Samsung over the relevance of the Apple-HTC license agreement to Apple's motion for a permanent injunction, which will be heard next Thursday (December 6), has entered the next stage.

In a first step, there was disagreement on whether the license fees paid by HTC would have to be disclosed to Samsung's outside counsel (Samsung's position, HTC's position and Apple's related argument). The court granted Samsung's motion but expressed skepticism of the actual relevance of the royalty rate to the injunctive-relief analysis.

Meanwhile the agreement has been made available but the parties disagree on how to enter it into the litigation.

On Friday evening local time, Samsung brought a motion to file the Apple-HTC agreement (obviously under seal). The agreement itself has now been filed with the court, but it won't be part of the record until the court grants Samsung's administrative request to file a declaration (which is short and can be summarized as saying "attached hereto please find the Apple-HTC agreement") for this purpose. The court also has to rule on a motion to seal the declaration, which is irrelevant to the actual declaration (the full text of which is also made available in a redacted form) but key with respect to its Exhibit A, the agreement.

HTC wants sealing, and Apple supports it. But Apple and HTC each have different primary concerns because of which they oppose Samsung's proposed course of action, which is to file the agreement as a whole, all by itself, with the court and to have the related argument at the Thursday hearing (and not before).

Apple primarily wants to avoid misunderstandings of the agreement by the court. Apple does not want "the Court to consider the agreement alone at this late date", arguing that "[t]his would mistakenly suggest to the Court that the agreement is relevant when it is not". Apple had no problem with Samsung's intent to file the agreement (so long as this happens under seal), but it wanted to have the right to file "a short statement [in another email, Apple said one page is not enough, but two pages would work] explaining its positions on the agreement". Apple also argued that Samsung is the party taking the initiative to discuss this agreement, so Samsung should explain why it believes it's relevant, and Apple would respond. By the way, Samsung's Friday filing only contains five (redacted) lines of an explanation as to why it considers the agreement relevant to the injunctive-relief analysis.

HTC's primary concern is to keep the terms of the agreement secret. It "concurs with Apple's view that it would not be helpful for the Court to consider the Agreement alone at this date" and is worried that sensitive information would be discussed in open court at the Thursday hearing if Samsung doesn't clarify which parts of the agreement it considers relevant. HTC's counsel doesn't say so because it's clear to the lawyers on the other side: a brief exchange of documents before the December 6 hearing would better enable HTC to ask the court to protect the secrecy of certain deal terms and to preclude the parties from discussing particular terms in open court. If Samsung doesn't say beforehand which arguments it will make, it's more difficult for HTC to take this precautionary measures.

Samsung's counsel would obviously like to be more flexible in choosing which parts of the agreement to reference at the Thursday hearing, and Samsung would also like to avoid that Apple's counsel can prepare for a particular anti-injunction argument before the hearing (though Samsung's arguments are sufficiently predictable that there won't be any major surprise to Apple's counsel, I'm sure).

Apple will presumably file something with the court, maybe even before Tuesday (the date it proposed for a response if Samsung had agreed that Apple would get two pages for a response) because there's so little time left between now and the Thursday hearing. And we may also see a filing from HTC to protect the confidentiality of certain deal terms.

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