Samsung Faces Sanctions over Leaked Apple, Nokia Documents

| Analysis

Samsung and its legal firm Quinn Emmanuel are facing sanctions for improperly disclosing confidential licensing agreements between Apple and Nokia. The sanctions will come as part of the ongoing mobile device patent infringement fight between Apple and Samsung, and a hearing is scheduled for December 9, following the retrial to determine damages in Apple's big infringement win against Samsung from last year.

Samsung is facing court sanctions over leaked Apple documentsSamsung is facing court sanctions over leaked Apple documents

The issues leading to the sanctions started when Quinn Emmanuel, the law firm representing Samsung in its patent infringement fight with Apple, gave the electronics maker confidential documents from Apple and Nokia's licensing agreements. The documents were intended only for special witnesses, and shouldn't have made it into the hands of Samsung executives. The law firm apparently uploaded confidential documents to Samsung's servers more than once, and claims have been tossed about saying Samsung used the documents to gain an unfair advantage in its own licensing negotiations with Nokia.

Judge Lucy Koh, who is presided over last year's patent infringement trial and will oversee the new trial to determine damages in the case, called the leak and subsequent attempts to hamper the court's investigation "inexcusable."

"Despite the fact that three months had passed since the alleged violation came to Quinn Emanuel's attention, Samsung and Quinn Emanuel still had no answers for Magistrate Judge Grewal at the hearing regarding the extent of the disclosures," she said. "Samsung's lack of information after three months is inexcusable, and necessitates Court-supervised discovery."

Initially, Samsung and Quinn Emmanuel were facing the prospect of sanctions in some form, but now it looks like that's really going to happen, according to Florian Mueller of FOSS Patents, especially now that new information has surfaced showing Samsung used the information from those classified documents in negotiations with Ericsson, as well.

"This doesn't look good for Samsung," Mr. Mueller said.

The document leak has repercussions outside of the United States, too. In Australia, the court dealing with a related Apple and Samsung patent infringement lawsuit is looking into how those documents may have been used and the Justice overseeing the case isn't pleased.

Justice Annabelle Bennett said in court,

I really cannot believe that Samsung has not put itself in a position of being able to answer virtually any question – these are obvious questions – whether Samsung has not put itself in a position to be able to answer those questions immediately in Australia. I find that incomprehensible.

Samsung and Apple will face off again in U.S. Federal Court again on Tuesday in a new trial to determine damages Apple is owed as part of its big patent infringement win in August 2012. The jury in that case awarded Apple over US$1 billion, but $365 million of that was tossed out because of a procedural error.

Instead of considering whether or not Samsung infringed on Apple's patents, tomorrow's trial will focus on what is owed as damages for a specific list of Samsung devices. Depending on the outcome, that $365 million figure could rise or drop, but the remaining $635 million will remain intact.

Once the Jury returns its verdict in that case, Samsung can start focusing on an appeal. Some of its resources, however, will go into preparing to defend itself in the sanctions hearing Judge Koh scheduled for early December. Considering how frustrated Judge Koh seems right now, Samsung better be ready for a hard day in court.

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Comments

gnasher729

Now the question: If Samsung used information about contracts between Nokia and Apple, which they received illegally from their lawyers, in their own negotiations with Nokia to their advantage and possibly saved many millions of dollars, what would be a suitable punishment?

RonMacGuy

“This doesn’t look good for Samsung,” Mr. Mueller said.

LMAO - Best quote of the day from Florian!!

gnasher - Unfortunately, any punishment will be at best a slap on the wrist, which is far from the ‘suitable’ punishment they deserve.  Samsung has absolutely no principles…

 

vpndev

I suspect that there will be sanctions on the law firm, and separate ones on Samsung.

Executives at Samsung need to be made aware that, even if the law firm screws up as seems happened here, for them to use the information once they became aware that the should not have possession of it - is a separate offense against the Court.

Samsung’s penalties will likely be a lot higher than those on the law firm.

gnasher729

I’m quite sure that Samsung executives are very aware of that. The problem is that they are so used to getting their own way in Korea, and so used to breaking the law to gain huge advantages with very few penalties, that they will continue to do so.

For example, by initially copying the iPhone design they gained a huge competitive advantage, not only compared to Apple but also compared to all their Android competitors who acted in a more honest way. Even if they have to pay a billion dollars in this case, they already made ten times more from their infringement.

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