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Apple, Inc. v. Samsung Electronics Co. Ltd.

United States District Court, N.D. California, San Jose Division

January 7, 2014

APPLE, INC., a California corporation, Plaintiff,
SAMSUNG ELECTRONICS CO., LTD., A Korean corporation; SAMSUNG ELECTRONICS AMERICA, INC., a New York corporation; SAMSUNG TELECOMMUNICATIONS AMERICA, LLC, a Delaware limited liability company, Defendants.


LUCY H. KOH, District Judge.

Following the issuance of the Federal Circuit's mandate vacating the denial of Apple's motion to permanently enjoin Samsung's infringement of Apple's utility patents, see Apple Inc. v. Samsung Elecs. Co., 735 F.3d 1352 (Fed. Cir. 2013), Apple renewed its motion for a permanent injunction in this Court, see ECF No. 2897. Samsung's opposition to Apple's renewed motion is currently due by January 9, 2013, and Apple has noticed a hearing date of January 30, 2014, the same date the Court will hear argument on the parties' post-trial motions. Samsung now moves for leave to take discovery of Apple's offers to license its utility patents subsequent to the briefing on Apple's original permanent injunction motion and for an extension of time for Samsung to file its opposition to Apple's renewed motion. See ECF Nos. 2900 ("Samsung Mot. for Time"), 2901 ("Samsung Mot. for Discovery").[1] Samsung also filed an unopposed motion to expedite the briefing on its motion for leave to take discovery, which this Court granted. See ECF No. 2905. Samsung's discovery and extension motions are now fully briefed. Having considered the parties' arguments and evidence, as well as the full record in this case, the Court DENIES Samsung's motions.

I. Samsung's Motion for Leave to Take Discovery

Samsung's motion for leave to take discovery asks this Court to reopen the record so that Samsung may take a Rule 30(b)(6) deposition on Apple's willingness to license its utility patents from October 19, 2012-the date of Samsung's opposition to Apple's original motion for a permanent injunction-to the present. In particular, Samsung notes that the parties have engaged in further licensing discussions since the Court issued its ruling on Apple's previous motion and that, during those discussions, Apple made additional offers to license its utility patents to Samsung. Samsung Mot. for Discovery at 4-5. Samsung seeks discovery related to these offers and what it calls the "key issue" on remand: whether Apple's offers to license its utility patents to Samsung "demonstrate[] that legal remedies [will] be adequate." Id. at 5.

Samsung proposes four Rule 30(b)(6) deposition topics to Apple. See Smith Declaration, Exhibit 2 (ECF No. 2902-6). The first three topics relate to Apple's licensing discussions with Samsung regarding the utility patents-in-suit since October 19, 2012. The fourth topic is a catch-all topic that relates to any similar licensing discussions between Apple and "any third parties." Id. Other than Apple's license to HTC, which the Court addresses below, neither Samsung, Apple, nor the record suggests that Apple has licensed or offered to license the utility patents-in-suit to any other party since October 19, 2012, and Apple represents that no additional licenses exist. See Apple Opp'n at 5.

A district court has broad discretion in deciding whether to reopen the record. See Enzo Biochem, Inc. v. Calgene, Inc., 188 F.3d 1362, 1379 (Fed. Cir. 1999). Here, the Court concludes that the discovery Samsung seeks is unnecessary and at most would reveal confidential settlement discussions, and the resulting delay would be unfair to Apple.

As an initial matter, Samsung's motion is untimely at least in part. Samsung fails to explain why it never previously sought discovery as to Apple's willingness to license its utility patents from October 19, 2012 to December 17, 2012, even though Samsung did seek discovery in November of 2012 as to Apple's post-trial license with HTC, which the Court allowed. See ECF Nos. 2144 and 2158.

More generally, Samsung has failed to establish that its need for discovery of Apple's licensing discussions with Samsung justifies further delay in resolving Apple's request for permanent injunctive relief. Samsung, as a party to its settlement discussions with Apple, surely is already aware of any "key" concessions Apple made to Samsung during those discussions. Nothing in the record, including Samsung's motion, suggests that further discovery would be fruitful.

For its part, Apple has been awaiting resolution of its request for a permanent injunction for nearly a year and a half following the jury's infringement verdict. (Apple filed its original motion in September of 2012, a month after the jury ruled in its favor.) Granting Samsung's motion for further discovery would extend the due date for Samsung's opposition to Apple's renewed motion until some time after Apple provides the requested discovery. Given the Court's full calendar, even a short extension would require the Court to postpone hearing Apple's renewed motion possibly by as much as four months. Samsung has not established why its discovery request warrants this further delay.

In addition, Samsung has not established why the discovery it seeks outweighs the dangers of forcing Apple to disclose information about the parties' recent confidential settlement discussions. At least in part due to this Court's insistence, settlement negotiations between the parties are ongoing. See Nov. 12, 2013 Pretrial Hr'g at 18-21. Apple states in its opposition that the parties have scheduled a further discussion for sometime in January. Apple Opp'n at 4. Allowing Samsung to obtain discovery of its own settlement negotiations with Apple for purposes of opposing Apple's motion for a permanent injunction would likely interfere with those ongoing negotiations.

The Court has repeatedly implored the parties to seek an amicable resolution of this matter. The Court is loathe to allow discovery into unconsummated negotiations between the parties that would undoubtedly impede future settlement discussions. See N.D. Cal. ADR L.R. 6-12(a) (prohibiting "all counsel and parties... attending [Court-sponsored] mediation" from using "anything that happened or was said, any position taken, and any view of the merits of the case... for any purpose... in any pending or future proceeding in this court."). The Court has allowed the parties to pursue settlement discussions outside the Court's normal ADR procedures. Nevertheless, the purpose of those procedures' confidentiality protections still applies. See Folb v. Motion Picture Industry Pension & Health Plans, 16 F.Supp.2d 1164, 1173 (C.D. Cal. 1998) ("[I]f participants cannot rely on the confidential treatment of everything that transpires during [mediation] sessions then counsel of necessity will feel constrained to conduct themselves in a cautious, tight-lipped, noncommittal manner more suitable to poker players in a high-stakes game than adversaries attempting to arrive at a just solution of a civil dispute.'") (quoting Lake Utopia Paper Ltd. v. Connelly Containers, Inc., 608 F.2d 928 (2d Cir. 1979)) (second alteration in original).

Samsung contends that discovery is needed to comply with the Federal Circuit's mandate. Samsung Mot. at 4. The Federal Circuit addressed this Court's analysis of Apple's past licensing practice as follows:

The district court's exclusive focus on whether Apple's patents are priceless' and whether Samsung is off limits' led it to disregard Apple's evidence that Samsung's use of these patents is different. Apple points to numerous factors that the district court failed to consider in determining the relevance of Apple's past licensing behavior. For example, Apple notes that IBM is not a competitor in the smartphone market, and that the license was entered into five years before Apple launched the iPhone. Apple further notes that it entered into the HTC and Nokia agreements to settle pending litigation. In addition, the Nokia agreement was a provisional license' for a limited standstill' period, ..., and the HTC agreement excluded HTC products that were clones' of Apple's products, .... Moreover, although the evidence shows that Apple offered Samsung a license to some of its patents, Apple is adamant that it never offered to license the asserted patents to Samsung, its primary competitor.[] We agree with Apple that these factors are relevant to whether monetary damages will adequately compensate Apple for Samsung's infringement of the asserted patents, and the district court erred by failing to consider them. Indeed, the district court's focus on Apple's past licensing practices, without exploring any relevant differences from the current situation, hints at a categorical rule that Apple's willingness to license its patents precludes the issuance of an injunction.

Apple Inc. v. Samsung Elecs. Co., 735 F.3d 1352, 1370 (Fed. Cir. 2012) (third emphasis added; footnote omitted).

Samsung seizes on this passage's reference to "the current situation" and contends that "[w]ithout limited discovery and reopening the record, this Court cannot evaluate all of Apple's past licensing behavior or the current situation' as the Federal Circuit has instructed." Samsung Mot. at 5. This passage from the Federal Circuit's opinion, however, is not an invitation, much less a mandate, to allow Samsung discovery into Apple's settlement offers to Samsung since Apple's last permanent injunction motion. Although the above-quoted passage makes clear that the Federal Circuit expects this Court on remand to analyze whether the circumstances surrounding Apple's prior licenses or offers to license shed light on whether legal relief would adequately compensate Apple for Samsung's infringement of the patents-in-suit, the Circuit's opinion simply does not address the propriety of allowing additional discovery into ongoing, Court-encouraged settlement discussions between the parties.

II. Samsung's Motion for an Extension of Time to Oppose Apple's Permanent Injunction Motion

Samsung's opposition to Apple's permanent injunction motion is currently due January 9, 2014. Samsung moves for a two-week extension to file its opposition. The Court's denial of Samsung's request for further discovery largely moots Samsung's stated need for more time. See Samsung Mot. for Time at 2 ("[T]here is good cause for a two-week extension of Samsung's time to respond to Apple's Motion for a Permanent Injunction so that the parties may brief and the Court consider Samsung's request for discovery.").

Samsung contends it needs more time also because "[a] substantial portion of the period for Samsung to prepare its response falls between the Christmas and New Year's Day holidays." Id. But Samsung has failed to show that preparing a response will be sufficiently taxing to depart from the standard two-week response time. Apple's renewed motion for a permanent injunction is only ten pages and has been a long time coming. It seeks the same relief as Apple's 2012 motion. The Federal Circuit's opinion vacating the relevant part of the Court's permanent injunction ruling issued on November 18, 2013. Apple notified the Court and Samsung on December 20, 2013, that Apple planned to file its renewed motion as soon as the Federal Circuit's mandate issued on December 26. Samsung did not seek rehearing at the Federal Circuit, and, as expected, the mandate issued and Apple filed its renewed motion on December 26. As explained above, a short extension of time will push the hearing on Apple's renewed motion well into the future. Although the Court is sensitive to the important personal demands on the parties and their counsel during the holidays, Samsung has not shown that the preceding history and circumstances surrounding Apple's renewed motion have created a burden that warrants delaying the hearing on Apple's requested injunctive relief any further.

III. Conclusion

For the foregoing reasons, Samsung's motions for leave to take discovery and for an extension of time to file its opposition to Apple's renewed motion for a permanent injunction are denied. Samsung's opposition is due January 9, 2014; any reply in support of Apple's renewed motion is due by January 16, 2014; and the Court will hear arguments related to Apple's renewed motion on January 30, 2014.


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