Apple Inc. v. Samsung Electronics Co. Ltd. et al

Filing 2195

ORDER re 1981 Brief regarding non-jury claims, filed by Apple Inc.. Signed by Judge Lucy H. Koh on 12/13/2012. (lhklc2, COURT STAFF) (Filed on 12/13/2012)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
For the Northern District of California

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APPLE, INC., a California corporation,

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Plaintiff,
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v.
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SAMSUNG ELECTRONICS CO., LTD., A
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Korean corporation; SAMSUNG
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ELECTRONICS AMERICA, INC., a New York )
corporation; SAMSUNG
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TELECOMMUNICATIONS AMERICA, LLC, )
a Delaware limited liability company,
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Defendants.
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Case No.: 11-CV-01846-LHK
ORDER RE: WAIVER, EQUITABLE
ESTOPPEL, UNCLEAN HANDS, AND
UNFAIR COMPETITION

In this patent case, Samsung accused Apple of infringing two of Samsung’s patents that
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Samsung has declared essential to the Universal Mobile Telecommunications System (UMTS)
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standard: U.S. Patent No. 7,675,941 (“the ’941 Patent”), and U.S. Patent No. 7,447,516 (“the ’516
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Patent”). 1 At trial, the jury found that Apple had not infringed either of these patents. See

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Amended Jury Verdict, ECF No. 1890, at 17. Now before the Court is Apple’s motion for a ruling
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on its equitable defenses to infringement. ECF No. 1981. Specifically, Apple asserts that
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Samsung’s conduct related to the development of the UMTS bars Samsung from asserting these
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claims against standard-compliant products under the doctrines of waiver, equitable estoppel, and
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Samsung asserted infringement of several other patents, but only these two patents are the subject
of the defenses at issue here.
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Case No.: 11-CV-01846-LHK
ORDER RE: WAIVER, EQUITABLE ESTOPPEL, UNCLEAN HANDS, AND UNFAIR COMPETITION

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unclean hands. 2 Because the Court finds that these defenses cannot affect the outcome of the

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present case in light of the jury’s finding of noninfringement, the Court, in its discretion, will not

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consider these defenses at this time.

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Apple argued at the hearing on December 6, 2012, that its equitable defenses are not

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technically moot because they would render the entire patents unenforceable against all standard-

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compliant products, while the jury’s verdict was limited to certain claims and certain products.

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The Court agrees that under Federal Circuit precedent, 3 the issue is not technically moot so as to

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deprive this Court of subject matter jurisdiction. See In re Omeprazole Patent Litigation, 483 F.3d

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1364, 1375 (Fed. Cir. 2007) (“The inequitable conduct claim was not technically moot, because it

United States District Court
For the Northern District of California

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would have rendered the entire ’281 patent unenforceable, rather than just the claims that were held

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invalid.”).

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However, both parties agreed at the December 6, 2012 hearing that the equitable defenses

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no longer present a live issue between the two parties in this case, and that the only effect of a

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ruling on Apple’s claims would come through collateral estoppel in future cases. Both parties

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further agreed that while this Court does have subject matter jurisdiction to decide the equitable

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defenses, it would be within this Court’s discretion to not decide these issues until they are before

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the Court as a live controversy. Indeed, courts have long recognized that in some situations, there

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is wisdom in refraining from issuing a ruling that would have no practical effect. See, e.g.,

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Fletcher v. United States, 116 F.3d 1315, 1321 (10th Cir. 1997) (“Under the doctrine of prudential

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mootness, there are circumstances under which a controversy, not constitutionally moot, is so

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attenuated that considerations of prudence and comity for coordinate branches of government

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Apple also argues that the Court should find that Samsung violated the California Unfair
Competition Law, but asks the Court to make such a finding only if the Court grants judgment as a
matter of law in favor of Apple on its breach of contract claim. Mot. at 11. As the Court has not
yet issued an Order on Apple’s motion for judgment as a matter of law, the Court will not address
the unfair competition claim at this time.
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Federal Circuit law governs the application of Article III to patent disputes. See Schreiber Foods,
Inc. v. Beatrice Cheese, Inc., 402 F.3d 1198, 1202 (Fed. Cir. 2005) (“[Q]uestions of the district
court's jurisdiction – upon which this court's jurisdiction depends – are always determined under
Federal Circuit law.”).

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Case No.: 11-CV-01846-LHK
ORDER RE: WAIVER, EQUITABLE ESTOPPEL, UNCLEAN HANDS, AND UNFAIR COMPETITION

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counsel the court to stay its hand, and to withhold relief it has the power to grant.”) (internal

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quotation marks omitted); S. Yuba River Citizens League v. Nat'l Marine Fisheries Serv., CIV S-

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06-2845 LKK, 2010 WL 4746187 at *2 (E.D. Cal. Nov. 16, 2010) (“Under the doctrine of

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prudential mootness, district courts may dismiss a claim where not technically moot, but

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nonetheless where circumstances [have] changed since the beginning of litigation that forestall any

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occasion for meaningful relief.”) (citing Hunt v. Imperial Merchant Servs., Inc., 560 F.3d 1137 (9th

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Cir.2009) (internal quotation marks omitted)).

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In this case, a decision now would not provide Apple with any meaningful relief, because
the jury has already found that Apple is not liable to Samsung for infringing these patents. Further,

United States District Court
For the Northern District of California

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a decision on Apple’s equitable claims would require the Court to interpret a policy of the

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European Telecommunications Standards Institute (ETSI) that is governed by French law. See

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Apple’s Brief Regarding Non-Jury Claims, ECF No. 1981, at 1 (arguing for equitable defenses due

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to violation of ETSI policy); PX74 at Art. 12 (ETSI policy choice of law clause). Moreover, the

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jury decided several claims stemming from the same factual predicate at issue in the equitable

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defenses, including a breach of contract claim and an antitrust claim. Consequently, resolution of

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Apple’s equitable defenses would entail a delicate inquiry into precisely what factual findings must

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underlie the jury’s verdict, as the Seventh Amendment right to a jury trial in civil cases requires the

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Court to credit those factual findings in resolving the equitable claims. See Beacon Theatres, Inc.

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v. Westover, 359 U.S. 500, 510 (1959). The Court does not find it advisable to issue binding

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interpretations under foreign law, or to inquire into the precise contours of the implied factual

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findings underlying a jury verdict, where it is not necessary for the resolution of the currently

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pending case.

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Finally, Apple has argued that because these questions have important policy implications

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for standards-setting organizations, the Court should decide them now. The Court finds that the

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importance of the questions counsels against deciding them in a case where the issue is no longer

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squarely presented. The issue is best left for a case in which the parties have every incentive to

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brief and argue the issue as thoroughly as possible, to ensure that the decision eventually issued on

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this question is a correct one. Accordingly, the Court takes no position on the merits of Apple’s
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Case No.: 11-CV-01846-LHK
ORDER RE: WAIVER, EQUITABLE ESTOPPEL, UNCLEAN HANDS, AND UNFAIR COMPETITION

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equitable claims, and declines to decide whether Samsung’s patents are unenforceable as against all

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UMTS-compliant products under the doctrines of waiver, equitable estoppel, and unclean hands.

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IT IS SO ORDERED.

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Dated: December 13, 2012

_________________________________
LUCY H. KOH
United States District Judge

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United States District Court
For the Northern District of California

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Case No.: 11-CV-01846-LHK
ORDER RE: WAIVER, EQUITABLE ESTOPPEL, UNCLEAN HANDS, AND UNFAIR COMPETITION