Based on the latest (2010) corruption ratings by Transparency International, my country, Germany, has better corruption control than 93% of all countries monitored, while the United States is ahead of "only" 86% of countries. But formal criteria for corruption and the general public's perception of problematic conduct relating to actual, potential or merely-perceived conflicts of interest (beyond corruption per se) differ, and they also differ between countries. When I founded an online gaming company in 1996 and wanted to be chairman and CEO at the same time (just so I could postpone the search for an independent chairman), which is what American start-up entrepreneurs typically are (at least at the very beginning), my professional advisers were shocked. I was told that this is unthinkable in Germany for checks-and-balances reasons. To put the underlying philosophy in Latin: Quis custodiet ipsos custodes? Who will guard the very guards?
Conversely, can you imagine what would happen if Microsoft hired a U.S. circuit (i.e., appellate) judge to testify in a German litigation on an issue affecting a multitude of cases in his circuit and, to make things worse, on (inter alia) a case actually pending in his circuit, meaning that the case would be sure to reach his appeals court absent a prior settlement between the parties?
This is hypothetical, but knowing how certain radical voices claiming to represent the wider open source community feel about and cry foul over these kinds of things when particular players are involved, the story would be all over the Internet. And the commentary would be all but flattering. I wouldn't rule out that some extremists would accuse Microsoft of "being in the judge-buying business" and develop conspiracy theories going back to the time before Microsoft had even been founded.
On Independence Day I discovered that Google had retained, at a rate of approximately $450/hour, a German patent appeals judge, Professor Dr. Maximilian Haedicke, to testify on German FRAND procedures and post-judgment fee-shifting. At the time it appeared that he testified primarily on general issues surrounding the German Orange-Book-Standard framework and (as a secondary matter) fee-shifting, which are certainly issues relevant to the Oberlandesgericht Düsseldorf (Düsseldorf Higher Regional Court), and the only pending litigation on which he commented in particular was the German Motorola-Microsoft H.264 patent infringement dispute pending in a different circuit (Karlsruhe Higher Regional Court, previously before the Mannheim Regional Court).
Just to be clear, it's problematic enough that he would testify, as a Google-hired gun, on FRAND. Many FRAND cases are brought in his circuit, even though Mannheim may be a more popular venue for standard-essential patent assertions (and for wireless patent disputes in general). It's also an isue that he would take money from Google. Cases involving Google as a party can reach his circuit court all the time (for example, Motorola sue an Apple subsidiary (Apple Retail Germany GmbH, which operates the official German Apple Stores) in Düsseldorf, where Apple subsequently filed a design-related infringement action against Motorola's Xoom tablet and also sued Samsung over design rights and design-related unfair competition issues). Cases involving Google's Android mobile operating system are pending before the lower Düsseldorf court (at least I'm aware of various ones Nokia brought against HTC and ViewSonic in 2012). Judge Haedicke may want to consider recusing himself from all cases involving standard-essential patents, Google, Android, Android-based devices, or countersuits by Android device makers against non-Android device makers like Apple and Nokia.
Yesterday Microsoft and Google filed various documents in the build-up to next month's FRAND breach-of-contract trial in Seattle. One of these documents contains excerpt from Professor Haedicke's pre-trial testimony, and it appears that he's more interested in doing a good job for Google than in staying neutral. Here's the document, and the most interesting part from a conflict-of-interests point of view begings on page 18 (by the numbering of the PDF document, not that of the full transcript; below the document I'll quote and comment on the key passage):
THE VIDEOGRAPHER: This begins Video 2, Volume 1 in the deposition of Maximilian Haedicke.
Going back on the record, it's 11:37.
BY MR. LOVE: You are a judge in the patent division of the Dusseldorf Court of Appeals; is that correct?
Q What is the relationship between that court and the Regional Court of Dusseldorf?
A It's the Court of Appeal for the Regional Court.
There you have it: this is his circuit, and cases adjudged by the Düsseldorf Regional Court are appealed to the Düsseldorf Higher Regional Court. Let's continue:
MR. LOVE: I've marked, as Exhibit 6, a translation of a March 21st, 2013 decision for the Regional Court of Dusseldorf.
Q Are you familiar with this decision?
Q Have you read it before?
This is the Düsseldorf Regional Court's order to stay a Huawei v. ZTE patent infringement case pending referral of certain fundamental FRAND-related antitrust questions to the Court of Justice of the European Union (CJEU) in light of an apparent difference in the interpretation of European antitrust rules between the European Commission's preliminary ruling in the Samsung case and the German Orange-Book-Standard practice.
On the first few pages, there are some questions that are numbered 1 through 5.
Q These are questions that the Dusseldorf court is submitting to the European Court of Justice; is that correct?
Q Why is a German court asking the European Court of Justices what to do about standard essential patents?>
At this point I believe Judge Haedicke should have declined to answer. He should have said something like "I can't comment on a case pending in my own circuit because if the parties don't settle in the near term, all of the issues in and aspects of this case, given that German patent appeals are de novo full reviews, will be put before my appeals court". But he didn't make that choice. If he had made it, it could have resulted in the exclusion of his entire testimony from the Microsoft-Google case. However, he wanted to give Google value. So he started to opine -- knowing very well that any of this could enter the public record, as it has. Here's the start of his elaborate reply:
A Because this is a matter of European law, and if a German court applies European law, such as European antitrust law, it is obliged to -- to do this in accordance with European law, and so if a German court does -- has doubts as to how to interpret European antitrust law, it can -- or the highest instance is obliged to ask for a preliminary judgment of the European Court of Justice, so the European Court of Justices can give guidance as to how to interpret a -- a provision of European law.
You can find all the details in the PDF I published further above, but for the purposes of this blog post let's skip right to the section where Google-paid Judge Haedicke even starts to read between the lines of his -- I repeat, his -- lower court's ruling:
Q Is it correct that what the Dusseldorf court is asking is whether the proper analysis is that set forth by the European Commission which involves a willing licensee, or is the Orange Book process satisfactory? Is that what this question is asking?
A Basically, yes. However, if you read the context and the entire judgment, the entire judgment here, there's a clear bias of the Dusseldorf court in order -- in favor of the Orange Book proceeding, and this questions are -- are asked in order to pose -- to show the contrast between the approach of the Euro Commission of its press release of -- of December 21st and the -- the Orange Book proceeding, so it shows differences, and further on in the text, criticizes some of the approaches of the European Commission."
Think again of the analogy with a totally hypothetical Microsoft-hired U.S. circuit judge opining on a case pending in his own circuit in testimony in another jurisdiction. And think about how certain voices would comment on it.
I want to be fair, and Judge Haedicke's interpretation of the tendentious nature of the Düsseldorf Regional Court's questions to the EU court is consistent with mine except that there's another aspect he doesn't address: the Düsseldorf court's decision to refer these questions to the EU court at all is also a statement, and it's contrary to the tone of the questions themselves. So basically the Düsseldorf court made an anti-Orange-Book-Standard decision, which has serious implications for a variety of German FRAND cases, but it then tried to show some loyalty to its past approach. At any rate, Judge Haedicke should have declined to answer these questions, and in particular he should not have alleged a "bias" on the part of his lower court.
Google could handle all of this in a much classier way. In its defense of Microsoft's substantive criticism of the Haedicke testimony, Google's Motorola even tries to get mileage out of his status as a judge, instead of claiming that he testifies in his other capacity (that of a university professor). In its opposition to Microsoft's Daubert motion Google consistently refers to Professor Haedicke as "Judge Haedicke", mentioning his job as a professor only after his judicial role ("Microsoft is unable to find any fault with Judge Haedicke's credentials--he is a highly-qualified German judge and professor and an expert in German patent law."). Google presumably hopes that Judge Robart or an appeals court will view and treat Judge Haedicke as a colleague and afford him so much deference that his testimony won't be excluded.
This is just my personal opinion, but as a German I'd actually appreciate if Judge Robart could grant Microsoft's Daubert motion because I believe it could reflect negatively on my country in some Americans' eyes if a Google-paid German judge takes the (paid) witness stand at a Seattle trial and gets asked some tough questions. It would be nice if this spectacle could be avoided. I don't have much hope that Google will withdraw him, or that he will resign voluntarily. Microsoft's criticism is indeed unrelated to his role as a judge. It's only about the (alleged lack of) substance of his testimony, as the sentence I quoted from Google's opposition brief shows.
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