Google LLC v. Sonos, Inc.

Filing 83

Discovery Order re: 71 Joint Discovery Letter Brief Regarding Protective Order Governing Discovery filed by Google LLC. Signed by Judge Thomas S. Hixson on 4/27/2021. (cdnS, COURT STAFF) (Filed on 4/27/2021)

Case 3:20-cv-03845-EMC Document 83 Filed 04/27/21 Page 1 of 4

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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GOOGLE LLC,
Plaintiff,

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United States District Court
Northern District of California

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Case No. 20-cv-03845-EMC (TSH)
DISCOVERY ORDER

v.

Re: Dkt. No. 71
SONOS, INC.,
Defendant.

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The parties have reached agreement on most of the terms of a proposed protective order,

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but they disagree about an acquisition bar that Google proposes. Google’s acquisition bar would

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prevent an individual who receives highly confidential material designated by the producing party

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from being involved in activity related to the acquisition of certain types of patents or patent

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applications, as well as from advising or counseling clients regarding such acquisitions, until two

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years after the final disposition of this action. Sonos objects that no acquisition bar is necessary

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because the protective order already states that protected material may be used by another party

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only for prosecuting, defending, or attempting to settle this lawsuit and may not be used for any

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business purpose. If the Court is inclined to include an acquisition bar, Sonos proposes to limit it

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as follows: “where the acquired patents (or patents resulting from the acquired patent

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applications) are then asserted against the Producing Party while this Acquisition Bar is in effect.”

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Sonos also argues that Google’s proposed bar is overbroad in other ways as well.

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Let’s think about this from a practical point of view. The portions of the protective order

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that the parties agree on already reflect a concern about the inadvertent use of protected material

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by people who have access to it in litigation and who simultaneously have a business role. This is

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reflected in paragraph 7.2(b), concerning who may receive confidential material: “Up to one

Case 3:20-cv-03845-EMC Document 83 Filed 04/27/21 Page 2 of 4

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House Counsel of the Receiving Party to whom disclosure is reasonably necessary for this

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litigation, provided however that such House Counsel do not have responsibility for business

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decisions and are not otherwise in a position to unfairly benefit from accessing the other side’s

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confidential information or using it for purposes beyond this this case . . .” For confidential

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materials, Sonos is willing to live with the limitation that only one in-house counsel may have

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access to it, as well as the structural limitation that this in-house counsel cannot have

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responsibility for making business decisions. This structural limitation plainly reflects the reality

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that people cannot be expected to forget information they know, so an in-house counsel who has

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responsibility for making business decisions simply cannot have access to a producing party’s

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United States District Court
Northern District of California

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confidential information.
For highly confidential information, the parties agree that no in-house counsel may have

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access to it, and that can also only be understood as a protection against inadvertent use. Instead,

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highly confidential material can only be provided to the receiving party’s outside counsel of

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record, the receiving party’s experts, the Court, litigation vendors, or the author or recipient of the

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information or someone who already knows or possesses it. (Highly confidential source code has

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more restrictions.)

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So, if we think about who is going to receive protected materials and who is also going to

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be involved in the acquisition of patents or patent applications, or advising about that, for

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confidential information, it’s going to be outside counsel of record in this case and that one in-

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house counsel who does not have responsibility for business decisions, and for highly confidential

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materials, it’s just going to be outside counsel of record. Google’s proposed acquisition bar only

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applies to an individual who receives access to highly confidential materials, so that one in-house

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counsel is not subject to the bar. Thus, the acquisition bar will apply only to outside counsel of

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record because those are the only people who would have access to highly confidential materials

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and who would also be involved in the acquisition or advice concerning other patents or patent

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applications. (The Court supposes that in theory an expert might also be involved, although

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Sonos’s arguments seem to assume only attorney involvement.) It is simply impossible to believe

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that the outside counsel of record in this case – that is, the litigators representing Sonos or Google
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Case 3:20-cv-03845-EMC Document 83 Filed 04/27/21 Page 3 of 4

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– could put out of their mind what they learn from the opposing side’s document productions.

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These attorneys are going to spend many hours with the other side’s documents. Remember:

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Google’s proposed acquisition bar applies to any “individual” who receives access to the other

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side’s highly confidential material, so it’s not like it applies to every lawyer at the firm; it applies

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only to the specific people who receive access to highly confidential material and who won’t be

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able to forget it.

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The Court agrees with those decisions that have acknowledged that it is fundamentally
untenable to allow people to be in a situation in which highly confidential information known to

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them would be extremely useful, and then demand they act as though they don’t know it. See

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Catch A Wave Techs., Inc. v. Sirius XM Radio, Inc., 2013 WL 9868422, *1 (N.D. Cal. Aug. 6,

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United States District Court
Northern District of California

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2013) (“Without impugning the integrity of plaintiff s counsel, an attorney who has learned the

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intricacies of Sirius’ secret technologies will be hard-pressed not to rely on that knowledge in a

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subsequent suit against Sirius. The two-year patent acquisition bar allows time for the limitations

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of human memory to run their course or for the information to become largely stale.”); EPL

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Holdings, LLC v. Apple Inc., 2013 WL 2181584, *4 (N.D. Cal. May 20, 2013) (“The purpose of

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the prosecution bar is to mitigate the risk of inadvertent use of confidential information learned in

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litigation by barring litigation counsel’s involvement in strategic decisionmaking related to the

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subject matter of the litigation. The acquisition of patents implicates this concern since litigation

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counsel may consciously or subconsciously use their knowledge of Apple’s confidential

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information to advise a client on which patents to acquire, that is, patents that may be asserted

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against Apple.”).

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At the same time, Sonos is also right that Google’s proposed acquisition bar is overbroad

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in that it prohibits the affected individuals from having any involvement at all in activity or advice

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concerning the acquisition of certain types of patents or patent applications. Prohibiting the

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affected individuals from advising on which patents or applications to acquire, or from advising on

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validity (because evidence concerning validity in this case will in part concern the parties’

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confidential documents and is not limited to just publicly available information as is sometimes

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the case in patent lawsuits) is reasonable, but there is no reason to prohibit those individuals from
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Case 3:20-cv-03845-EMC Document 83 Filed 04/27/21 Page 4 of 4

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advising on contract terms such as indemnification or cooperation provisions in an acquisition

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agreement.

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The Court rejects Sonos’s alternative proposal that the acquisition bar should apply only if

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the acquired patents are asserted against the producing party during the pendency of this lawsuit or

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within two years thereafter. There are two problems with that proposal. The first is that it invites

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the misuse of the producing party’s highly confidential information (by allowing outside counsel

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of record with access to that information, and who cannot forget it, to currently advise on which

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patents to acquire or which may be valid) and just delays the consequence of that misuse (the

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receiving party files the lawsuit alleging infringement of the newly acquired patent two years and
one day after this lawsuit ends). Second, outside counsel advising on patent acquisitions would

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United States District Court
Northern District of California

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have no way of knowing if they were complying with the protective order or violating it. That

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would depend on when their client files a lawsuit against the producing party based on the newly

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acquired patent, a future event over which they have no control.

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Accordingly, the Court holds that there should be an acquisition bar, but Google’s

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proposed bar is overbroad as described above. The Court orders the parties to file a revised

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proposed protective order consistent with this order within seven days.

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IT IS SO ORDERED.

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Dated: April 27, 2021

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THOMAS S. HIXSON
United States Magistrate Judge

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