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

Filing 641

OPPOSITION to ( 599 Apple's MOTION for Entry of Protective Order Regarding Disclosure and Use of Discovery Materials ) filed by Samsung Electronics America, Inc.(a New York corporation), Samsung Electronics Co. Ltd., Samsung Telecommunications America, LLC(a Delaware limited liability company). (Attachments: # 1 Proposed Order)(Maroulis, Victoria) (Filed on 1/17/2012) Modified text on 1/18/2012 (dhm, COURT STAFF).

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1 QUINN EMANUEL URQUHART & SULLIVAN, LLP Charles K. Verhoeven (Cal. Bar No. 170151) 2 50 California Street, 22nd Floor 3 San Francisco, California 94111 Telephone: (415) 875-6600 4 Facsimile: (415) 875-6700 5 Kevin P.B. Johnson (Cal. Bar No. 177129) 6 Victoria F. Maroulis (Cal. Bar No. 202603) th 7 555 Twin Dolphin Drive 5 Floor Redwood Shores, California 94065 8 Telephone: (650) 801-5000 Facsimile: (650) 801-5100 9 Michael T. Zeller (Cal. Bar No. 196417) 10 865 S. Figueroa St., 10th Floor 11 Los Angeles, California 90017 Telephone: (213) 443-3000 12 Facsimile: (213) 443-3100 13 Attorneys for Samsung Electronics America, Inc. and Samsung Telecommunications America LLC 14 15 UNITED STATES DISTRICT COURT 16 NORTHERN DISTRICT OF CALIFORNIA, SAN JOSE DIVISION 17 APPLE INC., a California corporation, CASE NO. 5:11-cv-01846-LHK 18 SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 19 Plaintiff, vs. 20 SAMSUNG ELECTRONICS CO., LTD., a Korean business entity; SAMSUNG 21 ELECTRONICS AMERICA, INC., a New York corporation; SAMSUNG 22 TELECOMMUNICATIONS AMERICA, LLC, a Delaware limited liability company, 23 Defendants. 24 Date: January 19, 2012 Time: 10:00 am Courtroom 5, 4th Floor Judge: Hon. Paul S. Grewal 25 26 27 28 Case No. :11-cv-01846-LHK SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 Preliminary Statement 2 Apple asks that this Court adopt a convenient protective order rather than a fair one. First, 3 Apple says that because the interim protective order included only an “Attorneys’ Eyes Only” 4 (AEO) tier of confidentiality protection, the actual protective order cannot differ: having to now 5 conform to a new order would be “inefficient and counterproductive” (Dkt. 599 at 10) and so AEO 6 should be the only available designation.1 Without even arguing, let alone proving, that it 7 properly designated all its productions as AEO, Apple complains about reviewing its production 8 and designating documents at the appropriate level of confidentiality. If Apple is to be taken at its 9 word, then the great inefficiency here was the time the parties and Court spent deciding the terms 10 of a new protective order—an order that Apple now says comes too late to meaningfully change 11 the interim order. This cannot be a serious position. The parties’ lengthy discussions have been 12 about setting aside the interim order to make sure this case is now to be governed by a just and 13 workable protective order, balancing the needs of the parties to maintain confidentialities while 14 still fully litigating their claims. Throughout this process, changes to the structure of the interim 15 order were necessarily contemplated. Just because imposing the right protective order might 16 require some effort does not mean this important case does not deserve it. 17 Second, Apple argues that the parties should have a duty to disclose all experts, even those 18 who are consulting experts protected from disclosure and who see any confidential document, no 19 matter how weak the basis for confidentiality happens to be.2 The purpose of a multi-tiered 20 protective order, such as the one Samsung proposes, is to thoughtfully separate those documents 21 that should be closely protected from those that, while not properly made public, should be 22 generally available to a litigant’s consultants and experts without delay. Apple’s portrait of this 23 24 25 26 27 28 1 “(a) Available Designations. Any Producing Party may designate Discovery Material with any of the following designations, provided that it meets the requirements for such designations as provided for herein: CONFIDENTIAL - ATTORNEYS’ EYES ONLY, or CONFIDENTIAL – OUTSIDE ATTORNEYS’ EYES ONLY SOURCE CODE.” (Dkt. 599-7 at 8 (Apple’s Proposed Protective Order).) 2 Based on discussion between the parties, Samsung had filed its motion under the impression that Apple was also proposing a three-tiered protective order, but intended to apply the Notice of Disclosure requirement even to the lower tier. When Apple filed its actual motion, however, Apple departed from its prior positions and unjustifiably proposed a protective order that only includes AEO-level protection. (See Dkt. 599-7 at 8.) Case No. :11-cv-01846-LHK -1SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 case fails to capture the many documents that simply do not warrant the close scrutiny of an AEO 2 designation.3 While Apple attempts to reduce this issue to Itay Sherman (who this Court already 3 has ruled can review documents that Apple claims are even more sensitive than AEO), Samsung’s 4 concern is primarily about the many non-testifying experts and consultants that will be necessary 5 to properly try this complex case. The parties’ legal right to keep such identities secret is 6 destroyed by Apple’s needlessly drawn-out disclosure requirements. 7 Finally, Apple’s claim that Samsung’s “Confidential” and “Highly Confidential- AEO” tier 8 are identical is incorrect. Samsung’s proposed protective order employs distinguishable 9 definitions of the tiers that allow for ready determinations of which category a document properly 10 belongs in. 11 Argument 12 I. Replacing a Temporary Protective Order is not Unduly Burdensome. 13 “[P]rotective orders that are on their face temporary or limited may not justify reliance by 14 the parties. Indeed, in such circumstances reliance may be unreasonable . . . . Where a litigant or 15 deponent could not reasonably have relied on the continuation of a protective order a court may 16 properly permit modification of the order. In such a case, whether to lift or modify a protective 17 order is a decision committed to the sound discretion of the trial court.” S.E.C. v. TheStreet.Com, 18 273 F.3d 222, 231 (2d Cir. 2001) (internal citations and quotations omitted); see also Welsh v. San 19 Francisco, 887 F. Supp. 1293, 1297 (N.D. Cal. 1995) (“Even in a situation where an interim 20 protective order is agreed upon by the parties, the Court is free to retain it, modify it, or dispense 21 with the protective order entirely.”). Apple cannot claim that re-designating documents it knew 22 were produced under a temporary order is unreasonable, especially when it fails to claim that its 23 designations were not objectively overbroad. Johnson v. Allstate Ins. Co., 07-CV-0781-MJR, 24 2008 WL 4279992 (S.D. Ill. Sept. 17, 2008) (protective order is impermissibly overbroad if it 25 “gives [a party] carte blanche to decide what portions of the record shall be kept secret.”). A case 26 27 28 3 Samsung’s Motion sets out a number of categories of documents Apple has unnecessarily designated as Attorneys’ Eyes Only. (See Dkt. 607 at 3-4.) Case No. :11-cv-01846-LHK -2SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 of this complexity demands that materials be designated under the correct level of confidentiality, 2 not the one under which they are conveniently already listed. 3 Contrary to Apple’s unsupportable complaints, protective orders typically include a non- 4 AEO “Confidential” designation in suits between competitors. Zest IP Holdings, LLC v. Implant 5 Direct Mfg., LLC, CIV. 10-0541-LAB WVG, 2011 WL 5525990 (S.D. Cal. Nov. 14, 2011) (“The 6 Court recognizes that Plaintiffs and Defendants are ‘fierce competitors’ as Defendants contend. 7 However, this intense rivalry does not trump Plaintiffs’ right and access to relevant information 8 they need to prosecute their case. The Court has approved a two-tier Protective Order proposed by 9 the parties in this action. . . . The Protective Order, at paragraph 4, allows the party producing a 10 document to designate the document as ‘Confidential’ and ‘Confidential—For Counsel Only.’”). 11 A litigant would be remiss to assume that a final protective order would fail to include the normal 12 and basic “Confidential” designation and Apple would be remiss to think it could perpetually 13 maintain an AEO designation over documents Apple does not even assert warrant it. 14 Re-designating documents at their appropriate level of confidentiality is also a far more 15 reasonable request than Apple represents it to be. Samsung is not asking that Apple independently 16 review every document it has already produced and make a re-designation. Rather, Samsung has 17 itself already identified a number of documents in its own briefing that Apple has over-designated. 18 (See Ex. B-J to Hutnyan Decl. (Dkt. 607-1).) This process of requesting re-designation as needed 19 is how courts best handle the creation of new tiers under protective orders in the middle of 20 litigation. Lockheed Martin Corp. v. Boeing Co., 6:03CV796 ORL28KRS, 2005 WL 5278461 at 21 *4 (M.D. Fla. Jan. 26, 2005). After granting plaintiff’s request to modify an existing protective 22 order to add another tier, the Lockheed court explained: “Because thousands, if not millions, of 23 pages of documents and items of information have been previously designated ‘Protected 24 Litigation Information’ under the Original Protective Order, a procedure must be developed to 25 allow the litigation to continue without the need to review and redesignate all such documents. 26 Because the Original Protective Order provided that ‘Protected Litigation Information’ could not 27 be disclosed to individuals engaged in competitive decisionmaking, the amended protective order 28 will require that previously designated documents be treated as Restricted Confidential Litigation Case No. :11-cv-01846-LHK -3SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 Information until such time as a party believes, in good faith, that review and redesignation of the 2 information is necessary for purposes of the litigation.” Id. As parties must initially designate 3 documents in the proper confidentiality tier in good faith, Van v. Wal-Mart Stores, Inc., C 08-5296 4 PSG, 2011 WL 62499 at *3 (N.D. Cal. Jan. 7, 2011), when a party is asked to re-designate a 5 document under the new protective order’s categories, this good faith duty should stave off many 6 further debates. Lockheed Martin Corp., 2005 WL 5278461 at *4 n.4 (“Under the amended 7 protective order, Boeing will have the option to designate documents as it, in good faith, deems 8 appropriate, recognizing that if its designation is challenged, it will have to present to the Court 9 prima facie evidence in support of its designation.”). Imposing a protective order with the normal 10 and basic “Confidentiality” tier that Samsung requests will “waste precious time,” (Dkt. 599 at 5), 11 only if Apple chooses to maintain its over-designation of documents in bad faith. 12 II. The Record is Rife With Apple Documents That Do Not Qualify for “Attorneys’ Eyes 13 Only” Protection and Which Samsung Should be Allowed to Show its Non-Testifying 14 Consultants Without Disclosing Their Identities. 15 Apple argues that “[t]he expert-disclosure provisions of the originally agreed protective 16 order are necessary to provide each party with a reasonable opportunity to object before such 17 sensitive, commercial information is shown to potential competitors. This requirement should be 18 true for all confidential documents prior to access by potential competitors.” (Id. at 9.) In practice, 19 this would mean that any time counsel for either party wishes to show anything to a consultant, 20 they must wait a week in case the other side objects. (Dkt. 599-7 at 22.) In a case where Apple 21 admits time is “precious,” (Dkt. 599 at 5), its version of the protective order only stands to slow 22 discovery to a crawl and unfairly hinder Samsung’s ability to prepare its defenses. The central 23 feature of Samsung’s proposed “Confidential” tier is that it allows for the parties to accelerate the 24 preparation of their cases by easily sharing less sensitive documents with experts and consultants. 25 After suffering through months of Apple’s over-designation of low-risk materials, Samsung 26 believes a more efficient procedure as proposed by Samsung plainly is warranted. 27 Apple fails to discuss the distinction at the heart of Samsung’s proposed protective order: 28 some documents deserve to be AEO and some do not. When Apple produces the “most sensitive Case No. :11-cv-01846-LHK -4SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 materials in its possession,” the AEO designation is likely correct. (Id. at 8.) But when Apple 2 designates an email circulating a public news article as AEO, it is clearly abusing the one3 dimensional nature of the Interim Protective Order. (See Dkt. 607-4.) Case law “consistently 4 holds that trade secrets and other confidential business information are not entitled to protection 5 unless disclosure would result in a specified harm. . . . [T]he requirement of a showing of harm is 6 designed to prevent the parties from designating information that is too stale to be of current 7 commercial value, or information about which the designating party can only articulate a 8 speculative belief that the information might, someday and somehow, be damaging if it were 9 revealed.” Lockheed Martin Corp., 2005 WL 5278461 at *2. Including a “Confidential” tier is 10 not only consistent with the usual practice in federal court protective orders in intellectual property 11 cases, but serves as a compromise to Apple’s reluctance to participate in discovery in litigation it 12 chose to instigate and expedite. While Samsung agrees some level of confidentiality protection is 13 often reasonable, it is groundless for Apple to assert that everything it produces warrants AEO 14 status. Samsung’s graduated tiers allow Apple to designate as AEO that which it deems most 15 private, but not to hamper discovery by abusing that designation for materials of lesser 16 significance. 17 III. Samsung’s Proposed Protective Order Effectively Distinguishes Between the 18 “Confidential” and “Highly Confidential” Tiers. 19 Apple contends that “[t]here is conceptually no difference between what Samsung 20 describes as “Confidential” and “Confidential – AEO.” (Dkt. 599 at 10.) Samsung’s proposed 21 protective order defines the two tiers with distinct language. Under Samsung’s protective order, a 22 document can be designated as “Confidential” if it “contains or reflects information that qualifies 23 for protection under Federal Rule of Civil Procedure 26(c). (See Dkt. 607-2 at 10. (Samsung’s 24 Proposed Protective Order)); see also Fed. R. Civ. P. 26(c) (Protective orders can be issued to 25 “require[e] that a trade secret or other confidential research, development, or commercial 26 information not be revealed or be revealed only in a specified way.”). A “Highly Confidential – 27 Attorneys’ Eyes Only” document is one that “contains or reflects sensitive business information 28 that is confidential and/or, proprietary, trade secret, and/or commercially sensitive, where Case No. :11-cv-01846-LHK -5SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 substantial harm from disclosure cannot otherwise be avoided.” (Dkt. 607-2 at 12.) Samsung’s 2 proposal just requires the parties to make a good faith determination as to how “sensitive” the 3 information at issue is and how “substantial” harm from disclosure would be prior to selecting a 4 designation. Cf. Lockheed Martin Corp., 2005 WL 5278461 at *4 n.4 (“Under the amended 5 protective order, Boeing will have the option to designate documents as it, in good faith, deems 6 appropriate, recognizing that if its designation is challenged, it will have to present to the Court 7 prima facie evidence in support of its designation.”). 8 IV. Apple’s Allegations that Samsung Is Attempting to Avoid the Sherman Order Are 9 Unfounded. 10 Much of Apple’s brief contains yet more unprofessional attacks on Samsung’s integrity. 11 Apple distorts an out-of-context quote to ascribe to Samsung the insidious motive of using this 12 protective order to re-address the Court’s ruling on Itay Sherman. First, Samsung openly 13 addressed that ruling in its Motion for Clarification,4 so Apple’s accusations that Samsung is 14 making “an end-run around the Court’s Sherman Order,” (Dkt. 599 at 5), through its proposed 15 protective order is nonsensical. Second, as the full context of Samsung’s January 8th 16 correspondence with Apple, makes clear, Samsung was offering to accept Apple’s unreasonable 17 and legally incorrect5 request that non-testifying consultants be disclosed in exchange for a 18 concession on Apple’s part regarding Itay Sherman.6 In full, the relevant passage reads: Why should Samsung have to disclose consultants that are merely looking at “confidential” documents? Consultants’ identities are attorney work product, and there is no reason that Samsung should have to disclose their identities or other information and subject them to an objection process with respect to “confidential” 19 20 21 22 4 23 Samsung’s Motion for Clarification Regarding the Court’s December 22, 2011 Order may be found at Dkt. 606. 24 25 26 27 5 As discussed in Samsung’s Motion, Samsung has a right not to disclose to Apple the identities of its nontestifying expert consultants. Fed. R. Civ. Pro. 26(b)(4)(D) states: “Ordinarily, a party may not, by interrogatories or deposition, discover facts known or opinions held by an expert who has been retained or specially employed by another party in anticipation of litigation or to prepare for trial and who is not expected to be called as a witness at trial.” Under this standard, the party seeking this information must make a “showing of exceptional circumstances before names of retained or specially employed consultants may be discovered.” Ager v. Jane C. Stormont Hosp. & Training Sch. for Nurses, 622 F.2d 496, 502 (10th Cir. 1980) (citing cases). Apple makes no such showing here. 28 Case No. :11-cv-01846-LHK -6SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER 1 2 3 4 5 6 7 documents, especially when they have already agreed to be bound by the provisions of the Protective Order by signing a copy of Exhibit A; and are not a current officer, director, or employee of a Party, nor anticipated at the time of retention to become an officer, director or employee of a Party. That said, we will agree to the confidential tier with the “edit” you describe in your letter if you will agree that Itay Sherman may see any design-related items that are designated “Confidential.” To characterize Samsung counsel’s attempt to reach a quid-pro-quo compromise (to avoid 8 further motion practice) as duplicitous is offensive. See In re Livent, Inc., 98 9 CIV.5686(VM)(DFE), 2004 WL 385048 at *5 (S.D.N.Y. Mar. 2, 2004) (parties are encouraged to 10 compromise in solving discovery disputes). As explained above and in its motion, Samsung’s 11 concerns with Apple’s proposed protective order are justified and serious. But Samsung would be 12 within its rights to voluntarily waive these concerns for a concession by Apple elsewhere. For this 13 Court to treat Samsung’s effort to informally resolve the parties’ dispute on this issue as Apple 14 demands is unsupported by law and would only serve to undermine future efforts to avoid 15 burdening this Court with motions through voluntary compromise. 16 17 Conclusion For the foregoing reasons, Samsung respectfully requests that the Court deny Apple’s 18 Proposed Protective Order and adopt Samsung’s Proposed ProtectivSe Order. DATED: January 16, 2012 QUINN EMANUEL URQUHART & 19 SULLIVAN, LLP 20 21 22 23 24 25 26 By /s/ Victoria F. Maroulis Charles K. Verhoeven Kevin P.B. Johnson Victoria F. Maroulis Michael T. Zeller Attorneys for SAMSUNG ELECTRONICS AMERICA, INC., and SAMSUNG TELECOMMUNICATIONS AMERICA, LLC 27 28 Case No. :11-cv-01846-LHK -7SAMSUNG’S OPPOSITION TO APPLE’S PROPOSED PROTECTIVE ORDER

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