Samsung Electronics Co., Ltd. et al v. NVIDIA Corporation et al

Filing 829

MEMORANDUM OPINION. Signed by District Judge Robert E. Payne on 02/29/2016. (ccol, )

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IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA Richmond Division SAMSUNG ELECTRONICS CO., LTD., Plaintiff, V. Civil Action No. 3:14cv757 NVIDIA CORPORATION, Defendant. MEMORANDUM OPINION This STRIKE matter THE came TESTIMONY before AND the Court REVERSE on NVIDIA'S ENGINEERING JEONGDONG CHOE PURSUANT TO RULE 37(c) REPORTS {Docket No. 744). considered the associated papers and oral arguments, reasons stated below, the Court orally MOTION granted the OF TO DR. Having and for the motion in part and denied the motion in part. The Court granted a mistrial as to the 6,287,902 ("'902") and 8,252,675 ("'675") patents in order to provide sufficient time during which NVIDIA Corporation might engage in curative expert discovery, but denied the motion as it pertained to striking the testimony or reports of Dr. Jeongdong Choe. This Memorandum Opinion followed. BACKGROUND This patent Electronics Co., infringement Ltd. action ("Samsung") was against ("NVIDIA"), alleging infringement of the as the well as 6,819,602 patent brought NVIDIA '902 and {"'602"). by Samsung Corporation '675 patents, (Second Am. Compl., Docket No. 81).^ alleged, inter As to the alia, that '675 and NVIDIA had '902 patents, infringed by Samsung importing, selling, and offering to sell infringing products that were made by an infringing process and under an infringing design. Am. Compl., alleged 551 1323-2135, that accused NVIDIA 2288-2596}. More specifically, Samsung sold, products offered from regarding discovery, the design infringing products to NVIDIA's Mtn. Mem."). and the Court. the design have an expert Strike, In the the down" to absence the the Semiconductor evidence manufacturing manufacturing "tear imported Taiwan sought Docket non-responsive Id. and the and Id. Samsung and sale of (computers and the chips). to TSMC was for non-party Manufacturing Company ("TSMC"). During (Second No. 755, (E.g., allegedly TSMC allegedly Pl.'s 0pp. ("Pl.'s from the evidence process, the 17) entreaties of from from Choe parties TSMC about Samsung elected infringing chips to and offer an opinion about the design of the accused chips and how TSMC had made them. Choe"), an Techlnsights, Id. expert Inc. in Samsung chose reverse ("Techlnsights") Dr. Jeongdong Choe engineering ("Dr. employed to provide an expert by report ^ Other parties and claims were originally part of the action. By the time of trial, and NVIDIA, and the parties had been whittled down to Samsung the infringement of the '602, claims had been whittled '675, and '902 patents. down to on the design and structure of the allegedly infringing and the process that TSMC used to make those chips. At the outset of the case, of the Court, R. Civ. with 26 that respect Id. with the approval altered some of the disclosure obligations of Fed. P. provided the parties, chips through "all to a Stipulated materials that Discovery generated person's work by are a Order, which testifying expert exempt from discovery unless relied upon by the expert in forming any opinions in this litigation." (Docket No. 198, 8-9) up to trial, NVIDIA served a Request for Production of documents seeking your "documents behalf ... and for things (emphasis added)In the run generated litigation or by You or other(s) non-litigation on purposes, including but not limited to any teardown or reverse engineering reports, electron microscope images, product comparison response to reports." No. discovery that (Docket request and Stipulated Discovery Order, with the ^ The reverse Stipulated product sample analysis, 751, Ex. pursuant A). or In to the Samsung committed to provide NVIDIA engineering documents Discovery Order, relied upon by Dr. like the Federal Choe Rules protected communications between counsel and testifying experts (Docket Mackay, No. 193 S[ 5); see also, e.g.. Republic of Ecuador v 742 F.3d 860, 869-70 (9th Cir. 2014); Republic of Ecuador v. Hinchee, 741 F.3d 1185, 1195 (11th Cir. 2013) Republic of Ecuador v. For Issuance of a Subpoena Under 28 U.S.C. Sec. 1782(a), 735 F.3d 1179, 1186 (10th Cir. 2013) Siemens Med. Sols. USA, Inc. v. Saint-Gobain Ceramics Plastics, Inc., 637 F.3d 1269, 1286 (Fed. Cir. 2011). & in connection with his expert report. Mtn. Dr. in Supp. Jeongdong Dr. Choe Pursuant to R. Docket No. (and, engineering 751, following reports that a Docket Exs. No. 745, No. 751, his expert Exs. H-J) . reports (Def.'s Choe Mem. 46:16-17:14; At cited numerous 8; infringement exhibits Docket No. 47:17-48:22; cases 751, which because based their analyses on Dr. both reverse cross-sectional Dr. were Ex. 289:13-19). upon fifteen) images (Def.'s Choe Mem. 6-8; Docket his deposition. and foundation Choe testified that accurate and K 19:7-11; Dr. complete. 41:16-42:11; report served parties both Choe's built their parties' infringement experts Choe's explanation of the design and manufacture of accused chips produced for NVIDIA by TSMC. PI.'s Choe Mem. forming either 28, his opinions, neither side. (E.g., 16). During cross-examination at trial, disclosed 4-5 B-E). supplement, of the allegedly infringing chips. the 37(c), Choe ultimately produced an expert report that included thirteen in of to Strike the Testimony and Reverse Engineering Reports of ("Def.'s Choe Mem."); as (Def.'s Mem. in his (Def.'s Choe 2016 518:1-519:22, he had expert Mem. Dr. relied reports 9-14; Choe testified that, on images nor see also, 697:14-16; 705:16-21). to that counsel e.g., Tr. In particular. were for Jan. Dr. Choe testified that he had reviewed a large number of so-called EDS and EEL images that were not disclosed, and that he had relied on some of those images in reaching the conclusions stated in his expert reports and in his testimony at trial. essence, and Dr. In Choe explained that he had used both the disclosed undisclosed images: (1) to select the most images for disclosure in his report; and (2) representative to confirm that the images that he had reproduced in his reports and testified to at trial were accurate. followed is a specifically According to Dr. standard and by process Choe, used practitioners of the process that he both by Techlnsights semi-conductor reverse- engineering generally. Id. The images Court from immediately. Thereafter, NVIDIA's Lee"), instructed Techlnsights (Tr. Jan. witness performed previously 29, and to to procure provide 2016 744:8-21). the a on brief images. infringement. preliminary NVIDIA undisclosed materials upon to NVIDIA Samsung did so. Dr. exam concluded undisclosed them and while trial was progressing on the expert undisclosed Samsung Lee the that which '602 patent, Jack of ("Dr. previously some Dr. Id. of Choe the relied demonstrated that silicon was present in the TiN/TaTiN layer of the allegedly presence of infringing silicon in chips. that (Def.'s layer is an Choe Mem. important NVIDIA's non-infringement defense in this case. Id. 9). aspect The of The parties agreed upon an accelerated briefing schedule to address how this apparent discovery violation should be handled. (Tr. Jan. 29, 2016 963:17-964:10). followed. on the This motion Following oral argument, '675 and '902 patents, and the associated papers the Court declared a mistrial but proceeded with trial on the '602 patent. LAW AlID APPLICATION NVIDIA's motion for sanctions was filed pursuant to Fed. Civ. R. P. 37(c)(1), which provides that: If a party fails to provide information or identify a witness as required by Rule 26(a) or (e) , the party is not allowed to use that information or witness to supply evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless. In addition to or instead of this sanction, the court, on motion and after giving an opportunity to be heard: (A) (B) may order payment of the reasonable expenses, including attorney's fees, caused by the failure: may inform the jury of the party's failure; (C) and may impose other appropriate sanctions, including any of the orders listed in Rule 37(b)(2)(A)(i)-(vi). Fed. R. Civ. P. 37 (b) (2) (A) (i) - (vi) provides the following way of alternate or additional sanctions: (i) directing that the matters embraced in the order or other designated facts be taken as established for purposes of the action, as the prevailing party claims; (ii) prohibiting the disobedient party from supporting or opposing designated claims or defenses, or from introducing designated matters in evidence; by (iii)striking pleadings in whole or in part; (iv) staying further proceedings until the order is obeyed; (v) dismissing the action or proceeding in whole or in part; (vi) rendering a default judgment against the disobedient party The process of deciding whether to impose sanctions such as those requested by NVIDIA involves three major steps: (1) determining that a violation of a discovery order or one of the Federal Rules of Civil Procedure occurred; (2) determining whether that violation was harmless and substantially justified, by reference to Southern States Rack & Fixture, Williams Co., 318 F.3d 592, a sanction to the violation, A. 597 {4th Cir. Inc. 2003); v. and Sherwin- (3) fitting violation of a rule of if one is found. Establishing The Existence Of A Violation First, a court determines whether a civil procedure or a court order has occurred. 26 expert requires that an witness's report Fed. must R. Civ. include P. "the facts or data considered by the witness in forming" his opinion. Fed. R. parties, Civ. P. with 26 (a) (2) (b) (ii) the Discovery Order Court's that (emphasis approval, provided: "all added). agreed to materials However, a the Stipulated generated by a testifying expert with respect to that person's work are exempt from discovery unless opinions in this relied upon by the expert litigation." (Docket No. 198, in forming 8-9) any (emphasis added). Thus, Samsung's obligation here was to disclose the documents upon which Dr. Choe relied. At trial, Dr. Choe's testimony was whether he relied upon the undisclosed scans. Mem. on 9-14, 16-17). On January 28, cross-examination by 2016, NVIDIA's inconsistent (E.g., about Def.'s Choe in response to questions counsel. Dr. Choe clearly stated that he had relied upon material that was not disclosed as part of his report. (Tr. Jan 28, 2016 697:14-16, 702:10-22; Def.'s Choe Mem, 10-13).^ On January 29, 2016, Dr. Choe stated, with equal clarity, that he had not relied that was not disclosed as part of his report. 941:2-5; PI.'s Choe 0pp. upon (Tr. any material Jan. 29, 2016 5-6). The parties concur that the Court is both the appropriate factfinder and the proper judge of Dr. ^ Aside from several minutes of introductory remarks in English, Dr. Choe testified in Korean through an interpreter, whose work was verified by a check interpreter. The parties briefly tussled over whether Dr. Choe's understanding of "relied upon" is the result of potential linguistic difficulties. (E.g., Def.'s Choe Mem. 1-2, 18-21; Pl.'s Choe Mem. 6). The Court declines to investigate potential alternate meanings of "relied upon": the interpreters were skilled and capable, and they articulated concerns about linguistic nuances when such concerns arose. (E.g., Tr. Jan. 29, 2016, 940:18-19). The Court is not qualified to judge linguistic nuances, and must rely upon the work of the translators. Moreover, if the Court began second-guessing the interpreters' translations of record, it would wreak havoc upon the Court and the parties' ability to rely upon that record. The Court and the parties are entitled to - and for the sake of an orderly record, must rely upon the work of the capable translators. Choe's credibility on this issue. Choe 0pp. (Def.'s Choe Mem. 16-18; Pl.'s 6-7). The Court finds that, in keeping with regularly by Techlnsights and others in the did disclosed rely report. upon The documents, images Court Dr. that notes Choe were not that, did in not failing act procedures industry. with to used Dr. his expert disclose duplicitously or Choe those with any awareness that he was not fulfilling Samsung's obligations.'' It is equally counsel clear that, that in Dr. Choe following did his not usual explain to practice, Samsung's he had not disclosed all the materials upon which he had relied. In an attempt to argue that the nondisclosure was still not a violation, "raw data typically (Pl.'s fall characterizes back-up outside 0pp. 7). argument. their disclosure his and Choe Samsung's with Samsung own the First, are the Stipulated Thus, Dr. even of two according Fed. Discovery to Civ. Order to non-disclosed as Samsung, P. 26{a). problems supplanted relied upon the R. significant parties Choe if undisclosed material that, reach There of whatever opinions. files," the Rule that form or with 26(a) required support documetns were ^ The Court observes that standard practice in the semi-conductor industry is not standard practice in civil discovery. When the Court, by rule or order, requires greater disclosure than is standard in the industry, it is the Court's rule or order that governs. 9 "raw data and back-up files," Choe relied on them. they were subject they had to be disclosed if Dr. Because Dr. Choe relied upon these scans, to disclosure. Second, the record suggests that the undisclosed information was not just "raw data or back up files." materials Choe's - EEL expert report - and only On the EDS report. following disclosed 17-18) . Much of the omitted materials were the same type of scans - (Def.'s that Choe were submitted Mem. 11-18). with Dr. Dr. Choe's semiconductor industry standard procedures - one-tenth of these record before the are of the same kind and form materials. Court, {Def.'s the materials Choe Br. disclosed (though not the exact content) the materials that were not disclosed. Thus, as i t is not possible to characterize them as "raw date or back-up files" which would not be subject to the Stipulated Discovery Order. On this basis, all of Samsung the the Court finds that, materials violated nondisclosure was the not relied upon Stipulated known by by by failing to disclose its Discovery Samsung or expert. Order. its Dr. Choe, Although counsel, the it is nonetheless the responsibility of counsel to make clear to their experts Dr. the Choe's scope of applicable nondisclosure and disclosure the obligations. resulting violation ultimately be attributed to Samsung. B. Substantially Justified And Harmless 10 (Southern States) Thus, must standing alone, corrective action. disclose was not Fed. R. Civ. P. nondisclosure does not require A court only takes action if the (1) substantially justified and 37(c)(1); Southern States, (2) or justify failure to harmless. 318 F.3d at 595. In the Fourth Circuit,^ substantial justification and harmlessness are determined by reference to five factors stated in Southern States: (1) The surprise to the party against whom the evidence would be offered. (2) The ability of that party to cure the surprise. (3) The extent the to which allowing the evidence would disrupt trial. (4) The importance of the evidence,® and (5) The nondisclosing party's explanation for its failure to disclose the evidence.^ ^ The Federal Circuit reviews a district court's decision to exclude evidence under the law of the regional circuit. Tokai Corp. Cir. V. Easton Enterprises, Inc., 632 F.3d 1358, 1364 (Fed. 2011) . ® "Importance of the evidence" cannot, by itself, save improperly disclosed evidence from being found unjustified or non-harmless. Even if a party's entire case hangs on one expert, such that excluding the expert leads inevitably to summary judgment against that party, then that expert's testimony may be excluded if that expert's testimony was improperly disclosed. E.g., Zaklit v. Global Linguist Solutions, LLC, 2014 WL 4925780 (E.D. Va. Sept. 30, 2014). 11 Southern States, these factors Montgomery, 318 F.3d 318 lies F.3d at 597. The burden at "substantially the nondisclosing F.3d 214, 222 (4th Cir. 596. 751 with the failure If justified" and of party. 2014); to "harmless," establishing Wilkins v. Southern States, disclose then then was the not court proceeds to impose a sanction. Applying clear that the Southern Samsung's States failure nor substantially justified. to factors to disclose this was case, neither it is harmless Each factor will be considered in turn. 1. Surprise and Cure Samsung argues nondisclosure because before NVIDIA this hearings August and documents. was was notice Samsung depositions, 2015, NVIDIA able on trial. and 31, that that to cannot easily about also NVIDIA Dr. Choe Dr. be cure the Choe's points received had surprised out the nondisclosure methods that, notice relied by as on months through early as undisclosed (Pl.'s Choe 0pp. 9-11).® Thus, Samsung argues, NVIDIA ^ Bad faith is explicitly not one of the Southern States factors. E.g., Southern States, 318 F.3d at 596 ("excluding evidence only when the nondisclosing party acted in bad faith would undermine the basic purpose of Rule 37(c)(1): preventing surprise and prejudice to the opposing party); Rambus, Inc. v. Infineon Technologies, AG, 145 F. Supp. 2d 721, 725-27 (E.D. Va. 2001). ® Samsung also argues that NVIDIA was on notice of Dr. scan-selection methods as early as May 18, 12 2015, when Choe's Dr. Choe could not have been surprised by the testimony at trial, and it would have been easy for NVIDIA to have cured this violation if NVIDIA had acted when it received notice.® (Pl.'s Choe 0pp. 814). On this record, it is evident that Dr. Choe's disclosure of the process that he followed at various proceedings put counsel for NVIDIA and Samsung on notice that Dr. Choe's report would disclose only some of the scans upon which he relied. However, notice failure to curable, even the when that States, (relying This disclose material United in deposition in that on Carr v. F. expert deposition should 626 the testimony have report testimony 2d 453 587, F.3d 604 is because "Rule 26 disclosures are of discovery in litigation that uses expert that fails opponent's to provide ability litigation, and the case." Carr, was deposed in to these properly undermines a 453 F.3d separate (E.D. Va. (4th Cir. the district court's at 604; proceeding 2006)). A party its prolongs management Campbell also v. 2009) inhibits unnecessarily 593, or centerpiece witnesses. unfairly a covers Perkins prepare, the ITC E.g., often disclosures render completely 591-92 593, not unsurprising been disclosed. Supp. Deeds, does of v. United between Samsung and NVIDIA. (Pl.'s Choe 0pp. 9). It is the Court's understanding that NVIDIA's outside counsel in this case also represents NVIDIA in the ITC proceeding. ® The Court observes that this argument cuts both ways. If NVIDIA was on notice of the violation in August, then Samsung also was on notice on the violation in August, and could have remedied the violation before t r i a l . 13 States, 2011 WL 588344 (E.D. Va. Feb. 8, 2011) 26(a)(2) exists partly so that parties (noting that Rule are not required to discover the basis for an expert's testimony entirely through deposition testimony); see also Abraham v. 237 F.3d 386, 392-93 (4th Cir. 2001) failure motion to file a to Cty. (noting that one party's compel did nondisclosing party's obligation to disclose); Ltd. P'ship I, No. Dec. 2, 2013) of Greenville, not waive Adams v. 3:11-CV-141, 2013 WL 6229379, at *2 (noting the general proposition that the Kroqer (E.D. Va. what an opposing party should have known does not affect a nondisclosing party's obligations). A failure to disclose in the right form, at the right nondisclosure, notice does time, impedes such that not discovery at the time of later putting the opposing party on render the nondisclosure unsurprising or curable. The United States Court of Appeals for the Fourth Circuit and the district courts in this circuit are clear that an expert report should provides all be the trial, along with United States, Global Linguist 470 a comprehensive expert's the Fed. opinions bases for App'x Solutions, document those 153 LLC, that 2014 (4th WL that, will be opinions. Cir. by offered at Campbell v. 2012); 4925780, itself, at Zakit *3 v. ("the advisory committee intended that an expert's written report be so detailed and complete that it would Mispense[] with the need 14 to depose the expert."); Sharpe v. United States, 230 F.R.D. 452, 458 (E.D. Va. 2005). The significance of the expert report as the proper time and place for complete disclosure finds support in the structure of discovery: experts provide reports, and those reports form the basis for informed deposition-taking. Campbell, that 2011 WL 588344 at *3 an expert [expert's] revealing deposition report is information (noting that "Rule 26 provides ^may be provided'" at a conducted to support deposition does only the not after the notion that alleviate the surprise or incurability of a failure to disclose in a report).^® In conclusion, the record is clear that NVIDIA was on notice that Dr, Choe's report would disclose only a portion of the scans upon which he relied. However, that notice is not dispositive to a Southern States surprise or curability analysis because the duty to timely and completely fulfill expert disclosure requirements rests at all times on the proponent of the expert witness. What NVIDIA could have done does not alter what Samsung ought to have done. The rule is different when an expert's disclosures are complete, but simply not articulated as clearly as it might have been. Golden Nugget, Inc. v. Chesapeake Bay Fishing Co., L.C., 93 F. App'x 530, 536 {4th Cir. 2004). The case before this Court is not one of lack of clarity, however, but of absence of material. 15 Additionally, cure a failure notice to at disclose a deposition materials is that insufficient ought to have to been included in the expert report because disclosure in the right form (complete) before the party's and at the right time expert's ability (critical deposition) is engage to analysis {with the expert report, meaningful of the targeted deposition) , In surprise (such as it was) in critical expert's this the an opposing expert report, case, to and only way discovery taking to of cure a the at this juncture is to give NVIDIA an opportunity to engage in the full expert discovery to which it was cure entitled. The nature of this will be discussed in a following section. 2. Disruption To Trial The ^602 patent did not involve any of Dr. Choe's work, and required only several days of evidence. Accordingly, no disruption of the trial as to that patent. record, for the consequence of the nondisclosure was effecting the there was However, on this only meaningful complete disruption of the cure trial on the ^902 and ^675 patents. Theoretically, directed the evidence on expert and (3) as Samsung urged, parties the '602 discovery while directed the to proceed patent; (2) trial on the parties to 16 the Court might have: with the allowed *602 proceed presentation NVIDIA to (1) of conduct patent was underway; with evidence on the '675 and '902 patents promptly after the conclusion of evidence on the '602 patent. That would have allowed the trial proceed roughly within the time period allocated for trial, all three patents would originally chosen for theoretical alternative have been that purpose. would have tried In kept before and the jury words, other the to this trial going with minimal disruption to the jury and the Court. However, discovery forcing in a matter opportunity to cure, been no cure NVIDIA at of to all. analyze, days complete would have supplemental been an expert ineffective so much so that it would essentially have Techlnsights processing these images. NVIDIA to (Tr. 2016 1229:15-16). produce hours Asking opinions on these images over the course of a few days, in the of and of expert standards on, 1, hundreds jury-ready middle of a trial, depose Feb. spent would be an impossible schedule, large-scale civil litigation. In even by the sum, forcing NVIDIA to conduct expert discovery in a time period short enough to avoid disrupting the trial would have meant that NVIDIA could not conduct effective expert discovery. On excluding the Dr. other hand, Choe curing entirely, as the failure NVIDIA urged, to disclose would make by it impossible to hold a trial on the '675 and '902 patents at all. Both Samsung and NVIDIA's opinions upon Dr. infringement Choe's report. 17 experts predicate their If the Court had excluded Dr. Choe's report, intelligently then neither about infringement infringement, because expert both could relied speak on Dr. Choe's analyses and opinions in framing their own opinions. The fact that it was impossible to cure the failure to disclose without significantly disrupting the trial demonstrates the failure to disclose was not harmless. 3. The Nondisclosing Party's Explanation Samsung stresses that it held a good faith belief that the reports it disclosed contained all of the material relied upon by Dr. Choe in reaching his opinions, as required by the Stipulated Discovery Order. (Pl.'s Choe 0pp. 5-7, 17). The Court has no doubt that is true. Additionally, the parties agree that the experts believed that Dr. Choe's report followed the semi-conductor industry standard. as disclosed (Def.'s Choe Mem. 10, 17-18; Pl.'s Choe 0pp. 17). But faith - good or bad - is not relevant the substantial justification component or the harmless component of a Southern States analysis. Southern States, F. 725-27.^^ Supp, objective Southern 2d at circumstances States, 318 nondisclosing party 318 Instead, at failed to 598 the Rambus, nondisclosure. (considering disclose 145 argument E.g. that because opposing party Good faith comes into play in fitting failure, discussed in a subsequent section. 18 596; "explanation" looks to the surrounding F.3d F.3d at the sanction to the delayed producing based); Rambus, actions of 145 F. court disclosure). In feasibility parties' formula of full 2d at opposing sense, and undisclosed 732 was (considering whether party justified "explanation" timely opinion looks disclosure than belated more at the it does at intent. Examining the nondisclosure circumstances arose understand the full Choe, which Supp. and that upon and obligations hence under because here, it is Samsung's counsel extent of the material the the full extent Stipulated of clear that the failed to relied upon by Dr. Samsung's Discovery Order. disclosure (Pl.'s Choe Mem. 3-7). Counsel's lack of knowledge of the full extent of Dr. Choe's disclosure obligations is that substantially justifies a not the sort nondisclosure. of circumstance Campbell, 2011 WL 588344, at *5.^^ Indeed, any contrary holding would minimize the obligation retained that experts accordingly. counsel are bears doing Furthermore, to and any fully to make understand Rule 26 what their disclosures contrary holding would neglect that expert witnesses are under contract to the hiring party. " Again, the Court notes that, if NVIDIA was on notice of Dr. Choe's inadequate methods, then Samsung also was on notice of Dr. Choe's inadequate methods as early as August 31, 2015 (Pl.'s Choe 0pp. 9-11). As such, the ability to properly disclose through supplementation prior to trial was not the sort of circumstance outside Samsung's control that provides an adequate "explanation" under Southern States. 19 e»q-> Burger v. 1587396, at *1 must be Allstate Ins. Co., No. 07-11870, 2009 WL (E.D. Mich. June 8, 2009), and that their actions attributed to the party if the Court is to maintain reasonable control over discovery. In conclusion, the Southern States factors uniformly weigh against finding that Samsung's failure to disclose was harmless or substantially justified. C. Fitting The Sanction To The Failure Having determined that a violation occurred, violation was not harmless or substantially justified, necessary to determine what sanction to impose. R. Civ. P. 37(c) (1) is often read as and that the it is Although Fed. an automatic preclusion sanction against a noncomplying party that prevents that party from offering sentence of the the nondisclosed rule permits evidence "other at trial, appropriate Supp. select 2d at 724. District courts Rambus, in 145 enjoy broad discretion to an appropriate remedy in light of the circumstances. Southern States, second sanctions" addition to or in lieu of the automatic preclusion. F. the 318 F.3d at 593; totality of the Fed. R. Civ. P. 37(c) (1) . The Fourth Circuit employs a four-part test to guide the exercise of that discretion: (1) Whether the non-complying party acted in bad faith; 20 (2) The amount of prejudice that noncompliance caused the adversary; (3) The need for deterrence of the particular sort of noncompliance; and (4) Whether less drastic sanctions would have been effective. Law Enforcement Alliance of Am., Fed. App'x 822, 830 for Advancement, 500, 504 (4th Carriers, (4th Cir. Educ. Cir. Inc., 39 2003) v. USA Direct, Supp. see also 3d 752, Fourth Circuit has also noted a F.3d 583, 590 (4th Indians^ Flame 764 S.A. (E.D. 155 F.3d v. Va. Found. Indus. 2014). The need for sanctions to "level [] the evidentiary playing field." Silvestri v. 271 Inc. ^ 61 (quoting Anderson v. and Employment of Am. 1998)); F. Inc. Cir. 2001) Gen. Motors Corp., (evaluating appropriate sanction in case of spoliation) . NVIDIA sanctions: requested (1) exclude mistrial on the below, the Court that Dr. '675 and the Court Choe's testimony, '902 patents. concludes that impose a or one (2) of declare a For the reasons mistrial plus two an stated award of Levelling the playing field is a fairly common factor for formulating an appropriate sanction in the spoliation context. E.g., Cir. W. v. 1999) . Goodyear Tire & Rubber Co., 167 F.3d 776, That approach has also been used when 779 (2d crafting a sanction when previously undisclosed evidence was revealed at trial. Estate of Wallace v. City of Los Angeles, 229 F.R.D. 163 (C.D. Cal. 2005) (considering the need to "restore the prejudiced parties to the same position they would have been in absent the wrongful concealment of evidence."). 21 certain expenses best suits the conduct in question and the purposes of discovery sanctions. 1. Lack Of Bad Faith Although good faith is irrelevant to determining whether a discovery violation occurred under Southern States, Samsung's good faith is nevertheless relevant to fashioning a sanction for that violation although under Samsung's Anderson. counsel violation, they were not. The should record have been is clear aware that, of the In fact, they believed that they were acting in compliance with their obligations under the Stipulated Discovery Order. (Pl.'s Choe 0pp. 5-7, 17). Although the failure to disclose was a violation of the Stipulated Discovery Order, it was an honest mistake. Samsung's good faith counsels in favor of imposing the least severe sanction that also accomplishes the purposes of Anderson and Silvestri. 2. The Amount Of Prejudice Based on what is known now, the failure to disclose may have deprived NVIDIA of an opportunity^'' to make an argument that goes to the heart of NVIDIA's non-infringement defense. {Def.'s Samsung insists that this material will ultimately not help NVIDIA's case. (Pl.'s Choe 0pp. 15-17). The Court makes no judgment about how helpful this material will be. Assessment of such facts is reserved for the jury, and NVIDIA is entitled to make to the jury an argument informed by its expert's analysis of all the materials relied upon by Samsung's expert. 22 Choe Mem. 1, 14, 25). Denying NVIDIA that opportunity by forcing it to proceed without time adequately to analyze, supplement on the previously undisclosed constitute significant prejudice. sanction must be shaped to depose, information would In light of this factor, allow NVIDIA time to and any effectively analyze, depose, and supplement. 3. Need For Deterrence The the exact alleged design and product, circumstances that led to this nondisclosure infringer's alleged lack of knowledge manufacturing method used to create about the - the imported and the resulting need to rely on third-party reverse engineering reports not foresee a - are somewhat unusual, and the Court does significant need to structure a sanction to deter the exact type of oversight presented by the reverse engineering expert in this case. However, because deterrence is nondisclosure, still necessary left untreated, snarls that eat up the parties' jury's time, in contravention of resolved in a just, speedy, P. 1. of gives broader rise to the Court's time, the rule that cases and inexpensive manner. sense nasty and the should be Fed. R. Civ. There may not be much need to deter incomplete disclosure semi-conductor there time, in a is reverse certainly nondisclosure more a engineering need generally. to take Thus, 23 scans a any firm specifically, stance sanction in to this but deter case must sufficiently and strongly coininunicate that it is counsel's duty to fully understand its expert's process of generating a report and to ensure everything that that party the expert provides the party with requires to meet its disclosure obligations. Adequately measure of communicating deterrent this sanctions position that leave requires the some nondisclosing party worse off than it would have been if it had disclosed. Any less severe ruling would not adequately encourage attorneys to communicate the nature and extent of a party's obligation when dealing with expert witnesses, and might even encourage counsel to expert ignore missteps by their witnesses. Additionally, emphasizing counsel's obligation in such a fashion will help to foreclose future disruption of the sort presented here. As such, the final sanction in this case must leave Samsung worse off than it would have been had it properly disclosed. In final the of determining extent calculus must also take infraction. NVIDIA's NVIDIA the was discussed shifting, Here, counsel placed on that to follow the that sanction, into account all calculus notice subsequently, of up months Court in conjunction with a 24 must on factor the before finds mistrial, the Court's circumstances of in the failure nondisclosure trial. that As when will limited be cost- best effectuates the need for deterrence of nondisclosure while not granting NVIDIA a windfall for inaction. 4. Availability Of Less Drastic Sanctions; Levelling The Playing Field The remedies available to a court for discovery violations include: an order to the nondisclosing party to provide further discovery, shifting of costs adverse inference instruction, excluding all of a certain or issues, facts judgment or witness's dismissal. and testimony, a mistrial, Fed. 9948284, consider at *8 (S.D.N.Y. whether effective, less imposing fines, an excluding the withheld evidence, R. Fitzpatrick v. Am. Int'l Grp., WL fees, May drastic order and an Civ. Inc., an P. No. 29, entry of default 37; see 10 CIV. 2013). sanctions establishing also, e.g., 142 MHD, The would and choose the least drastic sanction. 2013 court must have been Anderson, 155 F.Sd at 504. In fulfills this case, the goals the of least drastic Anderson and sanction Silvestri is which a also mistrial coupled with limited cost-shifting. (a) A Mistrial Is A Necessary Component Of An Effective Sanction Mistrials for neither are they blessed the grant discovery unheard of a violations of. The mid-trial 25 are Fourth mistrial not Circuit on the common, but previously basis of a discovery violation. Abraham, 237 F.3d at 392-93 (4th Cir. 2001).^^ The Second Circuit has held explicitly that, "where ... the nature of the alleged breach of a discovery obligation is the non-production of evidence, a District Court has broad discretion in fashioning an appropriate sanction, including ... to declare a mistrial if the Residential Funding Corp. v. Cir. 2002). Circuits trial supports already DeGeorge Financial, Dicta from the First, also has the Seventh, notion that commenced." 306 F.3d 99 Eighth, mistrials (2d and Sixth may be an appropriate remedy when discovery violations are unearthed midtrial. Cir. 1991); Matei 1994); V. DesRosiers Davis v. {8th Cir. F.3d 843, Cessna v. Co., Moran, see also Jones v. (6th Cir. 35 949 American Jet Leasing, 1988); 852 Aircraft F.3d 1142, 1147 {7th (1st Cir. F.2d 15, 22 Inc., 864 F.2d 612, Illinois Cent. R. Co., 613 617 2010). In the criminal context, mistrials are only permitted when no other remedy will Harris v. Young, suffice, 607 F.2d owing to double 1081, 1086-87 discussed, the Court believes that severe sanction which fulfills the jeopardy concerns. (4th Cir. 1979). As a mistrial is the least purposes of Anderson and Silvestri. Additionally, the double jeopardy concern is absent in this case. As such, the proper standard is Anderson's more flexible "no lesser sanction will suffice" rather than inflexible "no other remedy will suffice." Accord. Harris's Zambrano v. City of Tustin, 885 F.2d 1473 {9th Cir. 1989) (holding that district courts are "under an affirmative obligation to explore alternative remedies" before declaring case). 26 mistrial in a civil District a mistrial particularly violations: discovery, 280, 285 *9 (1) suited Arqo Marine Systems, E.E.O.C. v. (N.D. information, as other a factors remedy that make for discovery the wronged party's need to conduct additional (S.D.N.Y. 1984); evidence, at courts have noted several Ohio the Inc. v. Camar Corp., (2) the importance of the nondisclosed Spitzer Management, May amount 102 F.R.D. 22, 2013); of time it Inc., and will 2013 WL 2250757, (3) the take volume to process of that information, and the resulting hardship to the jury. Id.; Estate of Wallace, 229 F.R.D. 2.^® These factors at 156; Milburn, are all present 1993 WL 173403, in this at *1- case to varying degrees. In this case, of reasonable a mistrial, expenses, is coupled with a limited assessment the least severe sanction that fulfills the goal of restoring NVIDIA to the situation it would have been in absent the failure to disclose. at 590; Estate of Wallace, 229 F.R.D. Silvestri, at 165-66. 271 F.3d Ordering Samsung to provide further discovery is useless to NVIDIA unless NVIDIA has time to process, depose, and use that discovery. Cases discussing the decision to grant a midtrial mistrial only in passing include Koehn v. Yamaha Motor Corp., USA, 1997 WL 250456 (D. Kan. Apr. 2, 1997) and In re Connolly N. Am., LLC, 376 B.R. 161, 164 (Bankr. E.D. Mich. 2007). These cases lack substantive discussion of why a mistrial was appropriate, but their existence tends to demonstrate that mistrials are accepted across the federal system as sanctions for discovery violations. 27 Given that Techlnsights spent hundreds of hours processing these images (Tr. Feb. expect NVIDIA to 1, 2016 put 1229:15-16), these materials it is to inappropriate to use several weeks from the time of production. any sooner than Granting a mistrial provides NVIDIA with the time i t needs. (b) Any Sanction Lesser Than A Mistrial Would Be Ineffective Of course, it is not enough that a mistrial can level the playing field: to meet the requirements of Anderson, a mistrial must the capable also be least severe sanction which is of curing the violation. Under severe the than because a circumstances other of this "terminating" mistrial delays Samsung's access to a jury. but does severity - the highest level - disagrees Dismissing with Samsung's states face, that Fitzpatrick, that Samsung's unquestionably the such a is less dismissal, completely preclude Fitzpatrick characterizes its reproduced above, as an "ascending" order of and dismissal. not mistrial A mistrial is also less severe than sanctions, or a sanctions exclusion of Dr. Choe's testimony. list of sanctions, case, a mistrial is harshest precluding the same level of as an entry of default judgment 2013 WL 9948284, characterization, claims on on the sanction future 28 at '902 - *8. in and '675 of slam those The Court this least would relief at case. patents the door patents in are being infringed. fundamental to However, because Samsung's Dr. infringement Choe's testimony case, excluding is his testimony would have the same impact as outright dismissal.By contrast, declaring a mistrial leaves the door to relief open. Samsung may return to the courtroom in a has been afforded sufficient time to few weeks, analyze, when NVIDIA depose, and supplement. Samsung's opportunity to take its case to trial will be briefly mistrial delayed, is less but severe not permanently than dismissal lost. As such, a or exclusion under these circumstances. No sanction less severe than mistrial would what it needs to level the playing field: time. drastic to sanctions discovery, inadequate cost to of ordering shifting level the Samsung (standing discovery Thus, provide alone), playing give and field NVIDIA the less further fines and are restore NVIDIA to the position it would have been in absent the failure to disclose. Additionally, several weeks rebut, the insufficient. is necessary lesser sanction having for concluded NVIDIA to of It is inappropriate, a mere that analyze, a depose, continuance having told a delay is of and also jury to expect a three-week commitment, to subsequently tell that jury that the Thus, NVIDIA's preferred sanction - exclusion of Dr. Choe's testimony - ins inappropriate, because a less severe sanction (a mistrial plus limited cost shifting) will satisfy Anderson and Silvestri. 29 case is going into an extended recess and that the jurors will need to return in several weeks. E.E.O.C. v. Spitzer Management, Inc•, 2013 WL 2250757 (N.D. Ohio May 22, 2013) (noting that such procedural irregularity would suggest attorney incompetence to a jury); Estate of impossibility of Wallace, 229 concluding F.R.D. at discovery 163 within (noting the the timeframe initially given to the jury as a reason to declare a mistrial) . Moreover, even if the Court declared an called this jury back in several weeks, extended recess and it is unlikely that the jurors would remember the evidence on the '902 and '675 patents that were presented during the first days of trial. Stone, 1993 WL 173403, that dividing a at *1-2 (D.D.C. May 14, Milburn v. 1993) (noting case over several weeks creates an "incoherent" presentation) . In this inference mistrial, situation, instruction the would Court also actually finds be more spoliation cases, is severe adverse than a Incoherence 71 is typically given in instructs that the jury may infer that absent favorable Marine Corp., 1.8 an and would also be inappropriate to the nature of the violation. An adverse inference instruction, evidence that to F.3d 148, a a party. 156 particular patent cases. 30 E.g., (4th Cir. concern Vodosek 1995). in v. Bayliner In this case. already-confusing the evidence is not actually missing. When the newly disclosed evidence is presented, the jury may find that it is favorable to NVIDIA, that neutral, Dr. or Choe's unfavorable testimony plays to NVIDIA. in this Given case, jury that the missing information would be places Samsung in a process the the key role instructing the favorable to NVIDIA worse position than giving NVIDIA time to information, and is, as such, actually a harsher sanction than a mistrial under these circumstances.^® Moreover, an adverse inference instruction would levy more blame on Samsung than the facts warrant: although the principal fault for the nondisclosure rests with Samsung, NVIDIA was on notice of the nondisclosure but took no action to remedy the nondisclosure prior to trial. To tell the jury that Samsung failed to disclose evidence would, severely than on the this record, circumstances prejudice warrant Samsung under more Anderson s and Silvestri. A mistrial is necessary to place NVIDIA in the position it would have enjoyed absent the nondisclosure. Accordingly, a mistrial is an essential component of crafting the least-drastic sanction available. Additionally, given the complex nature of the case and the parties' dispute over the utility of the newly disclosed data (Def.'s Choe Mem. 1, 14, 25; Pl.s Choe Mem. 15-17), it is unlikely that the Court could craft describes the nature and significance of data to the satisfaction of both parties. 31 an the instruction newly that disclosed (c) Limited Cost More Severe Effective Declaring a Shifting Is An Essential, But Not Than Necessary, Component Of An Sanction mistrial expense to NVIDIA. will necessarily result in added An allocation of all or part of that expense is also an appropriate and permissible component of a sanction. In this case, future some allocation of expense is necessary to deter nondisclosure by ensuring that the Court's sanction places the nondisclosing party in a worse position than it would have been if it had fulfilled its obligations. NVIDIA to (1) will necessarily incur additional supplemental relitigating the expert '902 and discovery '675 patents. expenses and (2) related partially Because of Samsung's role in creating the need for a mistrial, it is appropriate to shift some of this expense to Samsung. However, NVIDIA is certainly not blameless in the circumstances that necessitated a mistrial. Indeed, NVIDIA could have headed off the need for a mistrial months ago if it had acted on the notice that it was given in August, parties the goal best be have of 2015. played, the achieving served by Considering the relative roles that both a purpose level allocating of deterrence playing part 32 of field the (Anderson) (Silvestri) added and will expense of supplemental expert discovery to Samsung. Specifically, Samsung will be assessed the reasonable costs incurred by NVIDIA: (1) For the work of Dr. Lee in examining the previously nondisclosed images from Techlnsights, advising NVIDIA's counsel with in studying and respect to the supplemental report to be prepared by Dr. Fair and any rebuttal report submitted by for being deposed and report, the in helping deposition of Choe, respecting NVIDIA's Dr. Dr. these supplemental reports his counsel Choe and Dr. (and, in preparing supplemental prepare Fair rebuttal to take respecting reports as to Dr. Choe, if any); and (2) For the services of one lawyer in working with Dr. Lee on the work outlined as to Dr. Lee in paragraph (1) above; the the and depositions in of preparing Dr. supplemental reports Choe) Choe for and Dr. taking Fair as of to their (and any rebuttal report of Dr. and the defending of the deposition of Dr. Lee as to his supplemental report; and (3) The reasonable cost, if any, of travel and lodging for Dr. Lee for the taking of his deposition; and (4) The reasonable cost of travel and lodging for lawyer to take the deposition of Dr. Choe and Dr. one Fair on their supplemental reports (and any rebuttal report 33 of Dr. Choe) and to attend the deposition of Dr. Lee (if that deposition is taken where Dr. Lee lives). This limited cost-shifting provision takes into account all the goals enumerated in Anderson and Silvestri. First, the cost-shifting supplemental related to expert general second trial, is a to the reasonable discovery, expenses rather preparation for than either limiting associated to the fees and first with costs or the relatively limited sanction that takes into account Samsung's good faith. Second, granting cost-shifting at all takes into account the prejudice that NVIDIA incurred by proceeding through discovery with a significant handicap. Third, granting cost-shifting at all deters future similar failures by establishing a sanction which ensures that the costs of nondisclosure are higher than the costs of proper disclosure. Fourth, no lesser sanction will do, because deterrence requires that the Court leave Samsung worse off than it would have been if it had disclosed properly. Finally, imposing partial cost- shifting restores NVIDIA to where it would have been it had alerted Samsung or the Court to Dr. Choe's nondisclosure at the time NVIDIA was on notice of the nondisclosure. in this case nondisclosure, is intended without to giving inaction. 34 Cost-shifting compensate NVIDIA NVIDIA windfall a as to for the its In conclusion, addition to declaring Anderson^ s expenses the deterrent a severe and (2) cost-shifting mistrial goal. incurred during least goals; reasonable is necessary Limiting supplemental sanction that of some to kind in effectuate cost-shifting only expert discovery: effectuates Anderson's to (1) is deterrent discourages opposing parties from inaction after receiving notice of a failure to disclose, best effectuating the "just, speedy, and inexpensive" purposes of the Federal Rules of Civil Procedure. CONCLUSION For the reasons stated above, NVIDIA'S MOTION TO STRIKE THE TESTIMONY AND REVERSE ENGINEERING REPORTS OF DR. PURSUANT TO RULE 37(c) JEONGDONG CHOE (Docket No. 744) was granted in part and denied in part. The Court has ordered a mistrial on the '902 and '67 5 patents curative to provide expert discovery. NVIDIA an The opportunity to Court declined testimony or expert reports of Dr. Choe. to engage strike in the NVIDIA must carefully account for the fees and costs that it incurs (and has incurred) in effecting the cure for the Rule 26 violation. 35 It may submit a claim for those fees after the trial is concluded. 20 It is so ORDERED. 1s1 flE/ Robert E. Payne Senior United States District Judge Richmond, Virginia Date: February Z,.f, 2016 20 NVIDIA is cautioned that reasonableness is the standard by which its claim will be measured. Here, reasonableness encompasses the requirement of frugality because NVIDIA is far from blameless in the creation of the need for a mistrial. 36

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