Quintel Technology Ltd. v. Huawei Technologies USA, Inc. et al
MEMORANDUM OPINION AND ORDER. It is therefore ORDERED that Defendants' Emergency Motion for Partial Reconsideration (Dkt. 284 ) is hereby DENIED. Signed by District Judge Amos L. Mazzant, III on 3/9/2018. (baf, )
United States District Court
EASTERN DISTRICT OF TEXAS
QUINTEL TECHNOLOGY LTD.,
HUAWEI TECHNOLOGIES USA, INC.,
FUTUREWEI TECHNOLOGIES, INC.,
HUAWEI TECHNOLOGIES CO., LTD.,
and ZHENGXIANG MA
Civil Action No. 4:15-CV-00307
MEMORANDUM OPINION AND ORDER
Pending before the Court is Defendants’ Emergency Motion to Exclude Evidence or
Argument (Dkt. #285). After reviewing the relevant pleadings and motion, the Court finds the
motion should be granted.
Plaintiff Quintel Technology Ltd. brought this case alleging breach of a non-disclosure
agreement, misappropriation of trade secrets, fraud, correction of patent inventorship, and other
claims against four related defendants (collectively “Defendants”): (i) Huawei Technologies USA,
Inc., a company based in Plano, Texas; (ii) FutureWei Technologies, Inc., a company based in
Plano, Texas; (iii) Huawei Technologies Co., Ltd., a China-based entity; and (iv) Zhengxiang Ma,
the Principal Engineer for Radio Frequency Technologies at FutureWei Technologies, Inc. and the
named inventor of U.S. Patent No. 8,891,647 B2 (See Dkt. #20).
On August 15, 2017, Quintel filed a supplemental Rule 7.1 Corporate Disclosure Statement
notifying Defendants and Magistrate Judge Craven that Cirtek Delaware, a subsidiary of Cirtek
Electronics International (“Cirtek”), acquired Quintel (Dkt. #118).
As a result, on
September 7, 2017, Defendants filed a Motion to Compel seeking documents and information
related to Plaintiff’s acquisition (Dkt. #128). On October 3, 2017, Magistrate Judge Craven issued
an order granting Defendants’ motion to compel in part (the “October 3rd Order”) (Dkt. #137).
Specifically, Magistrate Judge Craven ordered Plaintiff to produce the Master Supply Agreement
(“MSA”) entered into between Quintel and Cirtek on November 4, 2015 (Dkt. #137). Magistrate
Judge Craven denied all other relief requested by Defendants, to which Defendants filed objections
On October 30, 2017, Defendants filed a Motion for Reconsideration (Dkt. #154), which
Magistrate Judge Craven treated as a motion for rehearing as opposed to a motion for
reconsideration. In their motion, Defendants requested that Magistrate Judge Craven reconsider
her partial denial of Defendants’ motion to compel based on “newly discovered evidence” from
the MSA Defendants received as a result of the October 3rd Order (Dkt. #154). On November 22,
2017, Magistrate Judge Craven issued an order reopening discovery for the production a specific
category of documents (the “November 22nd Order") (Dkt. #179). As a result of the November
22nd Order, on or before December 18, 2017, Plaintiff produced 100,000 pages of documents
(Dkt. #232, Exhibit 10).
On January 11, 2018, Defendants filed an Emergency Motion to Enforce Compliance with
the Court’s November 22 Order and to Compel (Dkt. #232). On January 23, 2018, Magistrate
Judge Craven issued an Order granting as modified Defendants’ Emergency Motion to Enforce
Compliance (Dkt. #250). In her order, Magistrate Judge Craven ordered Plaintiff to produce
certain documents and to make Robert Fishback (“Fishback”), Plaintiff’s Chief Financial Officer,
available for deposition (Dkt. #250). On January 26, 2018, Plaintiff filed Emergency Objections
to Magistrate Judge’s January 23, 2018 Order (Dkt. #253). On February 2, 2018, the Court
On January 23, 2018, the Court overruled Defendants’ objections (Dkt. #249).
overruled Plaintiff’s objections (Dkt. #263). Subsequent to the Court overruling Plaintiff’s
objections, Plaintiff provided Defendants with five additional documents.
See (Dkt. #285,
for deposition on
February 14, 2018.
Defendants contend that Plaintiff’s subsequent production and deposition of Fishback
“make clear that Quintel has withheld and continues to withhold extensive materials relevant to
the valuation of Quintel, its PUT technology, and the SONWav product at issue in this litigation.”
(Dkt. #285 at p. 2). As a result, on February 27, 2018, Defendants filed their Emergency Motion
to Exclude Evidence or Argument (Dkt. #285). On February 28, 2018, the Court issued an Order
requiring any response to Defendants’ motion be filed no later than 5:00 p.m. on March 7, 2018
(Dkt. #286). On March 7, 2018, Plaintiff filed its response (Dkt. #289).
Defendants claim that despite numerous court orders requiring Plaintiff to produce certain
information and documents, Plaintiff continues to withhold extensive relevant materials.
Specifically, Defendants argue that Plaintiff continues to withhold at least five categories of
material financial documents, including: (1) data room documents which cover valuations of
Plaintiff as part of the acquisition process that led to the Cirtek purchase; (2) Cirtek documents
possessed by Jojo Dispo, Plaintiff’s current Chief Executive Officer, and any other internal Cirtek
documents relating to the value of Quintel, SONWav, or PUT; (3) documents originating from
Stifel—Plaintiff’s investment banker, reflecting a valuation of Plaintiff as part of the acquisition
process that led to the Cirtek purchase; (4) raw Quintel forecasting data originating from any other
source that reflects that valuation of Plaintiff as part of Cirtek’s acquisition; and (5) post-August
2017 SONWav sales projections. As a result, Defendants request the Court preclude Plaintiff from
using at trial or otherwise referring to “financial documents and information that have not been
timely produced in this case.” (Dkt. #285 at p. 2). Moreover, Defendants contend that “Quintel’s
witnesses should not be permitted to make reference to any valuation or forecasting document that
has not been produced during the course of this litigation.” (Dkt. #285 at pp. 11–12).
Plaintiff responds that it “has no intention of using at trial any specific financial documents
that have not been produced in the case, but Quintel’s witnesses cannot be limited in their ability
to refer to ‘financial information.’” (Dkt. #289 at p. 1). In other words, Plaintiff agrees to an
order prohibiting the use of unproduced documents or information, but opposes an order
preventing witnesses from making reference to such documents or information.
The Court finds that an order prohibiting each party from both using and referencing
documents and information not previously produced is appropriate. Pursuant to the Court’s Order
Governing Proceedings, a party that fails to timely disclose all documents and information relevant
to their claims and defenses2 is prohibited from using such evidence at trial (Dkt. #15 at p. 4). As
such, the Court finds that neither party may use or refer to any document or information not
previously produced in this case.
It is therefore ORDERED that Defendants’ Emergency Motion to Exclude Evidence or
Argument (Dkt. #285) is hereby GRANTED.
The Local Rules for the Eastern District clarify that a piece of information is relevant to a party’s claim or defense
if it is information that (1) would not support the disclosing parties’ contentions; (2) includes those persons who might
reasonably be expected to be deposed or called as a witness; (3) is likely to influence or affect the outcome of a claim
or defense; (4) deserves to be considered in the preparation, evaluation or trial of a claim or defense; and (5) reasonable
and competent counsel would consider reasonably necessary to prepare, evaluate, or try a claim or defense. LOCAL
SIGNED this 9th day of March, 2018.
AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE
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