Wednesday, March 5, 2014

Apple publicly disclosed terms of its Nokia license while seeking sanctions against Samsung

I'm almost speechless, but at least I'm still able to write this post. There's a surprise turn of events concerning the inadvertent-disclosures issue that became a high-profile sideshow in the global patent dispute between Apple and Samsung. In late January, the United States District Court for the Northern District of California cleared Samsung but ordered its law firm in the Apple cases, Quinn Emanuel, to pick up the cost for Apple and Nokia's efforts relating to the inadvertent disclosure of highly confidential Apple-Nokia patent license terms. The court concluded that Apple and Nokia had not delivered proof that Samsung's licensing executives actually made use of that information in licensing negotiations between Samsung and Nokia. But the oversight by a QE associate (who has since left the firm) was deemed sanctionable.

Apple and Nokia were actually seeking draconian sanctions, which the court declined to impose. Late last month Apple also renewed a motion asking the ITC to impose sanctions on Samsung for the alleged use of that information in the investigation of Samsung's complaint against Apple. The original motion and the renewed one are both sealed.

Here's the latest, absolutely stunning development: Apple actually filed the terms of its Nokia license (as well as the terms of a license agreement with NEC) on a publicly-accessible court docket last October, where it remained for about four months until it was finally removed.

Samsung brought this issue to the court's attention in late February, but a related motion to compel Apple to provide some related information was initially sealed because Apple and Nokia claimed the motion contained confidential information, which Samsung disagreed with. The court disagreed with Apple and Nokia at least to some extent, and Samsung filed an amended motion to compel this early morning by California time.

The whole purpose of Samsung seeking discovery of this matter is that the court could still reduce the fees imposed on Quinn Emanuel. Here's what Samsung writes in today's motion:

"Apple's and Nokia's scorched-earth approach to Samsung's inadvertent disclosure, and the amount of the concomitant fees Apple and Nokia incurred in pursuing those efforts, must be juxtaposed against the fact that Apple had simultaneously posted (and Nokia neglected to notice) this information on the Internet for all the world to see. The fee award should be reduced accordingly." (emphasis added)

The fact that Apple made the very same confidential information publicly-available over the alleged (but ultimately not proven) use of which in private negotiations it wanted Samsung and its lawyers sanctioned could indeed -- and in my view should -- result in a reduction of the fee award.

I must admit I'm disappointed that I didn't actually discover that information during all those months. I'm sure I'd have seen it at earlier stages of the Apple-Samsung dispute because I was following those cases in more detail then. Starting last summer, I gradually reduced my patent litigation monitoring (and the blogging that is a by-product of it). That's why I didn't download and peruse each and every document the way I used to. If I had downloaded and seen the license terms, I most probably would have published them on this blog.

Samsung's motion also alleges that the inadvertent public filing of Apple's licensing terms with Nokia and NEC "was followed by at least two other instances the very next month where Apple again publicly filed [confidential business information]--this time belonging to its competitors, including Samsung and Google". Samsung raised that issue before, and I don't think it was nowhere as serious as the problem of a wholesale disclosure of the terms of the Apple-Nokia license.

Samsung now points to "Apple's aggressive campaign to seek sanctions against Samsung for its inadvertent disclosures" and argues that "transparency and evenhandedness" require Apple to provide information on what happened. Samsung indicates it may even seek sanctions against Apple after receiving and evaluating further information.

A hearing on Samsung's motion to compel will be held on April 8. No matter what the court will decide, this is a major boost for Samsung's (and Quinn Emanuel's) reputation. Whatever may or may not have happened as a result of certain inadvertent disclosures appears irrelevant now.

Here's the full text of Samsung's motion with all publicly-accessible exhibits:

14-03-05 Samsung Motion to Compel Apple Re. Public Disclosures of Confidential Info by Florian Mueller

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