Although it happened three years ago, the events giving rise to Qualcomm Inc. v. Broadcom Inc., 2008 WL 66932 (S.D. Calif., Jan. 7, 2008), still keep many lawyers, in-house and outside, up at night. My recent presentation to the AIPLA addressed how to best manage crises that may arise in trade secret litigation (i.e., contempt situations, spoliation of evidence). I thought a post applying some of those suggestions to a Qualcomm-like situation might be worthwhile.
Given the details of the case and the thorough treatment it requires, I am going to break this discussion down into two parts: Part I will cover the background of the case, while Part II will cover the suggested steps.
For the uninitiated, Qualcomm brought a patent infringement case against Broadcom for two of its patents. One of the central issues was whether Qualcomm had participated in a Joint Video Team (“JVT”) in 2002 and early 2003 for the H.264 standard for video coding. In the words of the court, “this argument was vital to Qualcomm’s success in this litigation because if Qualcomm had participated in the creation of the H.264 standard, it would have been required to identify its patents that reasonably may be essential to the practice of the H.264 standard, including the [two patents at issue], and to license them royalty-free or under non-discriminatory, reasonable terms.” Qualcomm, 2008 WL 66932 at *3.
During discovery, Qualcomm never produced documents showing it participated in the JVT in 2002 and early 2003 and its designated Rule 30(b)(6) witness on the issue apparently lied. According to the court, that witness testified falsely that Qualcomm only began participating in the JVT in late 2003, after the H.264 standard had been published.
As Qualcomm aggressively argued at trial that it did not participate in the JVT, an associate preparing a key Qualcomm witness discovered 21 relevant emails, none of which had been produced. Those emails showed Qualcomm had participated in the JVT in 2002 and early 2003. When the associate shared the emails with Qualcomm’s trial team, they concluded that they were not responsive to Broadcom’s discovery requests. The Qualcomm trial team did not conduct any further investigation to determine whether there were other emails that had not been produced.
The failure to identify or produce the emails came crashing down on Qualcomm when the witness admitted their existence during cross-examination. Qualcomm agreed to search the current and archived emails of five trial witnesses and discovered thousands of other emails that “revealed facts that appear to be inconsistent with certain arguments that [counsel] made on Qualcomm’s behalf at trial and in the equitable hearing following trial.” Id. at *6. It ultimately discovered approximately 46,000 documents (totaling 300,000 pages) that were not produced. Id.
After trial, the district court found that Qualcomm wrongfully concealed the patents while participating in the JVT and then actively hid this concealment from Broadcom, the court and the jury. The court further found that Qualcomm’s counsel participated in an organized program of litigation misconduct and concealment through discovery, trial, and post-trial. The court imposed a number of sanctions, including an award of $9.2 million in attorneys’ fees against Qualcomm and its attorneys, as well as post-judgment interest of $8.5 million.