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

Filing 895

Administrative Motion to File Under Seal filed by Apple Inc.. (Attachments: #1 Apple Inc.s Motion For Adverse Inference Jury Instructions Due To Samsungs Spoliation Of Evidence, #2 Declaration of Esther Kim ISO Apple Inc.s Motion For Adverse Inference Jury Instructions Due To Samsungs Spoliation Of Evidence, #3 Exhibit 1, #4 Exhibit 32, #5 Exhibit 33, #6 Proposed Order Granting Apple Inc.s Motion For Adverse Inference Jury Instructions Due To Samsungs Spoliation Of Evidence, #7 Proposed Order Granting Apple's Administrative Motion to Seal Documents)(McElhinny, Harold) (Filed on 5/1/2012)

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Exhibit 1 Peter Mauro Schroepfer 6397 Thornhill Dr. Oakland, CA 94611 Certificate of Translation 29 April 2012 I hereby certify that this Korean to English translation of a Republic of Korea Fair Trade Commission press release dated March 16, 2012 titled “Highest Fine Ever Levied for Samsung Electronics’ Repeated Obstruction of Investigations” is to the best of my knowledge an accurate and complete rendering of the contents of the document with the same title, that was obtained electronically on April 29, 2012 at t_data_div_cd=&tribu_type_cd=&currpage=6&searchKey=&searchVal=& stdate=&enddate=, except for the word “TRANSLATION” at the upper right corner and page numbers added at the bottom of each translated page. I further certify that I translated said document, that I am competent in both languages and have twenty years of professional experience in Korean to English translation. Translation Press Release Embargoed Until: Date of Release 3/16/2012 (Fri) Reporting allowed for morning papers 3/19/2012 (Mon) (3/18 (Sun) 12pm for internet & broadcasting mediums) We will achieve an advanced Republic of Korea without fail. Department Responsible Officials Responsible Market Monitoring Division, Service Industry Monitoring Section Spokesperson’s Office Manager Chul Hyun Kwon 02) 2023-4392 Administrator Hyun Kyu Park 02) 2023-4403 Tel 02) 2023-4044 Fax 02) 599-1085 “Highest Fine Ever Levied for Samsung Electronics’ Repeated Obstruction of Investigations” - Organized delaying of entry, destruction of evidentiary materials, flight of responsible personnel, submission of false data, etc. - □ Fair Trade Commission (chaired by Chairman Dongsoo Kim) levied the highest fine ever of 400 million won regarding Samsung Electronics Co., Ltd. and its employees’ act of obstruction of an investigation. Summary on Obstruction of Investigation □ 3/24/2011 (Thurs) During an on-site investigation of Samsung Electronics Co., Ltd.’s Suwon facility regarding mobile phone distribution, significant acts constituting obstruction of investigation occurred, in which numerous executive employees participated. While Samsung Electronics’ security and a third party security company’s employees delayed the FTC investigators’ entry, Samsung employees from the department subject to the investigation destroyed relevant materials and replaced the computers of those employees who were subject to investigation. The head of the department subject to the investigation evaded the investigation according to a contingency plan, and, following the FTC investigators’ withdrawal, returned to the office and deleted relevant materials saved on his computer. Furthermore, while explaining the circumstances behind delaying of entry, Samsung Electronics submitted falsified access records, having deleted record of the entry of the employee who replaced the computers. sf-3139209 1 Translation Details of Behavior Acts of Delaying Entry and Destruction of Relevant Materials At approximately 2:20pm of March 24, 2011, Samsung Electronics’ security and a third party security company’s employees delayed the entry of FTC investigators who were trying to get to the relevant department (Mobile Communications Division, Korean Product Planning Group) for an on-site investigation relating to mobile phone distribution. FTC investigators identified themselves as such and requested entry to the Mobile Communications Division, but their entry was continuously denied, with the reason given that unless an appointment was made, the personnel responsible must be present. Because of this, FTC investigators were able to reach the actual investigation site around 3:10pm, but by then, an employee ____ Kim was the only remaining person in the office. <Security Company’s Internal Report> 2:50 – 3:30 □ R3 lobby Information Communication Complex Lobby 2 Product Strategy Team - Situation reported to Lobby 2 through the manager’s landline – Delay in admitting entry ordered. - After shutting down operations office and the inner gate, ordered on-site back-up of two people. - FTC demands entry at the gate (confronted by six employees from Human and five employees from S1) - FTC presents internal document “Confirmation of Samsung Electronics Entrance.” - R4 support requested – two people sent (hereafter omitted). * R3 and R4 are building names on Samsung Electronics’ Suwon facility. * Human and S1 are third party security service providers at Samsung Electronics’ Suwon facility While FTC investigators’ entry was being delayed, materials subject to investigation were destroyed and computers of key employees subject to investigation were replaced under the direction of (Senior Vice President) ____ Park, Samsung Electronics Mobile Communications Division Support Team Leader sf-3139209 2 Translation - <Samsung Electronics’ Internal Report by Email> Instances discussed as obstruction of investigation: Restricting entry, physical altercation, replacing of computers (3 computers) Replacing of computers on the first day between 2:40 and 3 under the direction of the Support Team Leader, I, _____, replaced computers with empty ones. FTC found out about the replacement of computers on Friday morning, intense interrogation followed. Evaded under various reasons but suspicions remain (hereafter omitted) <Samsung Electronics’ Internal Report> Moving of documents in the desk drawer at the Korean Product Planning G Office prior to FTC entry Scene of destruction of documents 2:51pm Scene showing the moving of desk drawers * Above document is Samsung Electronics’ internal report and was made with CCTV captured footages The fact that delaying the entry of FTC investigators was not random was also confirmed by materials on the internal evaluation of the security employees. <Evaluation of Security Company Actions> * Information Protection Group* Meeting Content (Group Director ____Jung attended) 1. Group Director _____ Jung (Evaluation regarding FTC Visit on 3/26) 1) Evaluation: S1 and Human responded well - Confirmation of identity, response to trespassing, Information Protection and Communication’s response, and mutual cooperation and interfacing praised - Executed Information Protection Group’s directions faithfully: No questioning regarding the security company’s employees’ responsibility (following omitted) * Information Protection Group is a Samsung Electronics section in charge of security and directs the security companies. sf-3139209 3 Translation After this obstruction of the investigation, Samsung Electronics prepared something called the “Present Security Action Conditions in Response to Emergency Situations,” but the content of it was instead to further strengthen its security provisions. - Even if government investigators visit, deny entry of their vehicle at the main gate if no prior communication, construct barricades, designate key files as classified and delete permanently, and concentrate the data on the server, and etc. Acts of evading investigation and deleting materials from computers (Vice President) ____ Kim, head of a section at Samsung Electronics Mobile Communications Division, deliberately evaded the FTC investigation on March 24, 2011. - Even though Vice President ____ Kim was present at the Suwon facility at the time, he claimed he was on a business trip to Seoul headquarters during a phone conversation with the FTC investigator, and did not comply with the investigation request. - This type of response was in accordance with an internally established and previously planned scenario. <Samsung Electronics Internal Report> Per pre-planned scenario, Vice President ____ Kim responded that he was on a business trip to Seoul and after clearly ascertaining the investigator’s intentions, complied with the investigation the following day (following omitted) <Email that Vice President ____ Kim sent to Executive Vice President> 1. Progression of Events: - Thursday (3/24) afternoon around 2:30, raided Suwon without notice. During central gate and Information Communication Complex entry, physical altercation with Secom. - Swooped in to find Vice President ___ Kim, and Department Manager ___ Kim received and responded. During this time, other employees all left their stations except 3-4 employees. - I made up the excuse that I was at a meeting in Seoul and ascertained the ongoing situation from outside. (following omitted) sf-3139209 4 Translation When investigators withdrew because an investigation was impossible that day, the head of the department deleted all materials subject to the investigation stored in his computer, which had been hidden, using a file deletion program. * Internal documents and statements have confirmed that the deleted files were important materials relevant to the investigation. <An excerpt from Vice President ____ Kim’s statement> Q23. In the content of the email you sent to the Executive Vice President on March 25, it states that files containing “Korean roadmap iPhone countermeasure related report materials, Tab price policy, company’s proposal if iPhone not adopted, etc.” were deleted. Is it correct that you deleted such files? A. Yes, that is correct. Q24. What other files did you delete? A. I do not remember well, but I remember that I deleted all the relevant files that came up in a search for SKT-related files using the Windows search function. The Submission of Falsified Data FTC requested access to records of the building where the related department is located to verify the reason for the delaying the entry investigating civil servants on March 24, 2011. – Samsung Electronics submitted falsified records of who was admitted to the building, having held two meetings about submitting such records, in which it deleted the name of employee ____ Lee, the individual who had replaced the computers, sf-3139209 5 Translation <Internal Samsung Electronics Document> Hello. We would like to have a meeting as below to discuss the materials requested by FTC as I have previously communicated. o Date: 7/11 (Mon) 16:00 o Location: Suwon Business Site Information Communication Sector (Senior Manager _____, please reserve the conference room.) o o Attendees : See Recipients Agenda – Discuss the submission of Lobby 1 access records and phone records of 7 people – Share other progress status Please attend despite your busy schedules, as decision making is necessary regarding the content of statements up to this point and the individual phone records. Details of Action: Penalty total ₩400 million □ Samsung Electronics (Obstruction of investigation: ₩200 million, submission of falsified data: ₩100 million), 2 executives (₩50 million each) * Grounds for this measure: Statute for Monopoly Regulation and Fair Trade Article 69, Section 1, Paragraph 6, 7 □ In another related case, Samsung Electronics was fined an additional penalty of ₩2.38 billion for obstruction of investigation regarding its case for unfair customer enticement. The significance of this measure and future plan □ This action is to impose strict sanctions on corporations’ organized obstruction of investigations, which is becoming increasingly skillful. □ The maximum penalty legally possible was imposed on Samsung Electronics considering the following: It delayed access according to a plan and numerous employees destroyed materials during that time sf-3139209 6 Translation Intentional obstruction of an investigation under the direct command of high-level executives according to the company’s pre-planned scenario. It is a company with a repeated pattern of obstruction of investigation. It prepared falsified data and submitted it to the investigating agency to reduce the charge of obstruction of investigation Following this case of investigation obstruction, it drafted security procedures that put emphasis on making it difficult for FTC investigators to enter, instead of swiftly cooperating. □ Going forward, the FTC plans to continue with strict responses, using every possible legal means towards any company that obstructs investigation hindering the discovery of legal violations. The FTC will impose fines for obstructing investigations, increasing penalties for related cases, selecting repeated violators of obstruction of investigation as subjects for monitoring, etc. In addition, the FTC’s will actively pursue the imposition of penalties for future cases of obstruction of investigation such as delaying of site access. * On February 27, 2012, the National Assembly passed an amendment to the Fair Trade laws imposing imprisonment under 3 years, penalty under ₩200 million for obstruction of investigation including verbal abuse, assault, and delaying or restricting site access (announced March 16, taking effect June 16) Appended: Previous actions taken in major cases of obstruction of investigation. sf-3139209 7 Translation Appendix Decision Date Nov. 6, 1998 Jan. 31, 2003 Jan. 7, 2003 Aug. 4, 2003 Dec. 16, 2003 Jun. 3, 2005 Jul. 27, 2005 Dec. 2, 2005 Oct. 18, 2005 Mar. 17, 2006 Jul. 26, 2007 Apr. 3, 2008 Jul. 31, 2008 Oct. 22, 2010 Aug. 1, 2011 sf-3139209 Previous actions taken in major cases of obstruction of investigation Defendant & Case Name Resisting and obstructing investigation by Samsung Motors and its executives Submission of false report and data by executives of Samsung Card Submission of false data by Hyundai Merchant Marine Submission of false data by employees of CJ Resisting investigation by an employee of Kiturami Boiler Obstruction of investigation by an employee of Samsung Total Obstruction of investigation by employees of CJ Obstruction of investigation by Samsung Electronics and its employee Obstruction of investigation by an employee of Hyundai Hysco Obstruction of investigation by an employee of Semes Obstruction of investigation by INP Industries Obstruction of investigation by Samsung Electronics and its executives Obstruction of investigation by SK Communications and its executives Obstruction of investigation by an employee of eBay G-Market Obstruction of investigation by CJ CheilJedang and its executives Total Penalty (in million ₩) 120 20 30 10 10 185 20 50 50 10 15 40 125 250 340 8

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