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Qualcomm Inc. v. Broadcom Corp.

Qualcomm Inc. v. Broadcom Corp. 2008 WL 66932 (S.D. Cal. Jan 7, 2008). United States District Court for the Southern District of California. Sanctioning a Party Sanctioning Counsel. Qualcomm. Alleging patent infringement against Broadcom “104 patent” “767 patent”. Broadcom.

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Qualcomm Inc. v. Broadcom Corp.

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  1. Qualcomm Inc. v. Broadcom Corp. 2008 WL 66932 (S.D. Cal. Jan 7, 2008) United States District Court for the Southern District of California

  2. Sanctioning a PartySanctioning Counsel

  3. Qualcomm Alleging patent infringement against Broadcom “104 patent” “767 patent”

  4. Broadcom Manufacture, sale, and offers to sell H.264-compliant products Waiver defense -> Qualcomm’s participation in the Joint Video Team (“JVT”) in 2002 and early 2003 May 29, 2007 – Motion requesting Court sanction Qualcomm for failure to produce tens of thousands of documents

  5. Joint Video Team Standards-setting body that created H.264 standard Released in May 2003 Governs video coding H.264 is a standard for video compression Blu-Ray, Youtube, Itunes store, etc.

  6. Broadcom needs to prove Qualcomm participated in and communicated with JVT Rule 26(b)(1) Broad discovery, structured to allow “the parties to obtain the fullest possible knowledge of the issues and facts before trial.” Zubulake 217 F.R.D. at 316 Except where protected by privilege, allow discovery regarding any matter relevant to the litigation. Id.

  7. Federal Rules of Civil Procedure Rule 26(b)(2) Tempers the broad discovery mandate of 26(b)(1)

  8. Federal Rules of Civil Procedure Rule 26(b)(6) Depositions Attorney Kevin Leung prepared two separate witnesses, both impeached Never searched their computers for any relevant documents or emails or provided them with information to review

  9. TRIAL – JANUARY 2007 While preparing for trial, attorney Adam Bier discovered an August 6, 2002 email to an employing welcoming her to the avc_ce mailing list Searched her laptop and discovered 21 separate emails, none of which Qualcomm had produced in discovery

  10. TRIAL – JANUARY 2007 Qualcomm trial team decided not to produce these newly discovered emails to Broadcom, claiming they were not responsive to their discovery requests Ignored the fact that the presence of these emails undercut their premier argument that Qualcomm had not participated in JVT in 2002

  11. TRIAL – JANUARY 2007 Later at trial, attorney Stanley Young argued against admission of the December 2002 avc_ce email list: “Actually, there are no emails – there are no emails…there’s no evidence that any email was actually sent to this list. This is just a list of email…addresses. There’s no evidence of anything being sent.” No attorney present mentioned the 21 avc_ce emails found on employees computer a few days earlier

  12. TRIAL – JANUARY 2007 Over lunch hour, Qualcomm’s counsel produces the 21 emails: Jury returns unanimous verdicts in favor of Broadcom regarding non-infringement

  13. Judge Brewster findings - AUGUST By clear and convincing evidence that Qualcomm, its employees, and its witnesses actively organized and/or participated in a plan to profit heavily by 1) wrongfully concealing the patents-in-suit while participating in the JVT and then 2) actively hiding this concealment from the Court, jury, and opposing counsel

  14. Judge Brewster findings - AUGUST “counsel participated in an organized program of litigation misconduct and concealment throughout discovery, trial, and post-trial before new counsel took over lead role in the case on April 27, 2007

  15. MONEY Judge Brewster adopts District Court’s recommendation: $9,259,985.09 in attorney’s fees and related costs Post-judgment interest on final fee award of $8,568,633.24 at 4.91 percent

  16. Post-Trial Misconduct Feb 16, 2007: Attorney Bier told Broadcom: “we continue to believe that Qualcomm performed a reasonable search of Qualcomm’s documents in response to Broadcom’s Requests for Production and that the 21 emails…are not responsive to any valid discovery obligation or commitment

  17. Post-Trial Misconduct March 7, 2007 – Bier: We “believe your negative characterization of Qualcomm’s compliance with its discovery obligation to be wholly without merit” But he advised that Qualcomm agreed to search current and archived emails of five trial witnesses using the requested search terms: JVt, avc_ce, H.264 Qualcomm remained difficult to deal with for the rest of March…until..

  18. Busted April 9 – Qualcomm’s General Counsel, Batchelder and Lupin, submit correspondence to Judge Brewster admitting Qualcomm had thousands of relevant unproduced documents and that their review of these documents “revealed facts that appear inconsistent with certain arguments counsel made on Qualcomm’s behalf at trial and in the equitable hearing following trial”

  19. Legal Standard - FRCP Rule 37(a): authorizes party to file a motion to compel an opponent to comply with a discovery request or obligation when the opponent fails to do so initially Rule 37(b): court may impose additional sanctions No requirement that failure be willful or reckless; “sanctions may be imposed even for negligent failures to provide discovery”

  20. Legal Standard - FRCP Rule 26(g)(2): “what is reasonable is a matter for the court to decide on the totality of the circumstances” Rules 26(g)(3): If an attorney makes an incorrect certification without substantial justification, the court must sanction the attorney, party, or both and the sanction may include an award of reasonable attorney’s fees

  21. Legal Standard - FRCP Rule 37(c)(1): If a party, without substantial justification, fails “to amend a prior response to discovery as required by Rule 26(e)(2),” the court may prevent that party from using that evidence at trial or at a hearing and impose other appropriate sanctions, including the payment of attorney’s fees

  22. SANCTIONS QUALCOMM Presented no evidence attempting to explain or justify its failure to produce documents Not established that it searched the computers or email databases of witness testifying on their behalf Did no produce the 21 emails Did not conduct internal investigation Monumental and intentional discovery violation = $8,568,633.24 to Broadcom

  23. SANCTIONS ATTORNEYS – Court’s 4 Scenarios: 1) Qualcomm did intentionally hide documents from retained attorneys – effectively that the lawyers did not know or suspect that they existed 2) Retained lawyers failed to discover the intentionally hidden documents or suspect their existence due to their complete ineptitude and disorganization

  24. SANCTIONS ATTORNEYS – Court’s 4 Scenarios: Qualcomm shared the damaging documents and counsel worked with them to hide documents and all early involvement with JVT While Qualcomm did not tell retained lawyers about damaging documents, lawyers suspected but chose to ignore evidence and warning signs and accept Qualcomm’s incredible assertions regarding adequacy of document search

  25. Court rejects scenario 1, 2, 3 Talented, well-education, and experienced lawyers failed to discover any facts or issues that caused them to question sufficiency of Qualcomm’s document search and production 46,000 critical documents that extinguished Qualcomm’s principal argument No direct evidence establishing option 3 – no one told attorneys

  26. Court decides on ignorance One or more lawyers chose not to look at correct locations Accepted unsubstantiated assurances Ignored warnings signs that document search and production were inadequate Did not press employees to tell the truth And/or encourage employees to provide information that Qualcomm needed to assert its non-participation argument

  27. Which Attorneys? 3 responsible for initial discovery Federal Rules impose an affirmative duty upon lawyers to engage in discovery in a responsible manner and to conduct a “reasonable inquiry” to determine whether discovery responses are sufficient and proper Lawyer’s difficulty with two witnesses was a huge warning sign

  28. Which Attorneys? Did not sanction local attorneys – signed pleadings with false information but relied on work of other attorneys more actively involved in litigation Refers the Sanctioned Employees to the State Bar of California

  29. CREDO Case Review and Enforcement of Discovery Obligations program Identify failures in case management and discovery protocol utilized by Qualcomm and its in-house and retained attorneys Craft alternatives to prevent such failures Evaluate and test alternatives Create a case management protocol which will serve as a model for the future

  30. QUESTIONS Should Qualcomm be sanctioned where the fault lies with their Counsel? Can Sanctions be imposed on Qualcomm and its Counsel Jointly and Severally?

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