Complainant FlashPoint Technology, Inc. (“FlashPoint”) initiated an ITC proceeding against HTC Corporation, among others. FlashPoint filed a motion for a protective order seeking to limit the discovery of electronically stored information. FlashPoint proposed a limit of 15 custodians collectively for respondents to select, which included an option to negotiate for additional custodians if there was a good faith basis to add additional custodians from FlashPoint.
HTC asserted that a limit on email discovery would severely prejudice its ability to prove its on sale bar and implied license defenses. As explained by the Administrative Law Judge, “HTC is pursuing an on-sale bar because it believes there is a relationship between the asserted patents and FlashPoint’s invalidated U.S. Patent No. 6,163,816 (“the ‘816 patent”). The ‘816 patent was invalidated by an on-sale bar in ITC Investigation No. 337-TA-726 (“the 726 Investigation”). (Opp. At 5.) HTC further explains, “Flash Point is again claiming that HTC infringes patents arising from the FlashPoint project work conducted in the 1990s, and HTC is again raising the on-sale bar…” (Opp. At 6.) Thus it appears HTC’s motivation for the on-sale bar is its suspicion that because the asserted patents and the invalidated ‘816 patent were related to the same project work, the asserted patents might also be subject to the on-sale bar. HTC also briefly explains the motivation for its implied license defense, namely that HTC is a customer of a licensee of FlashPoint’s technology.”
HTC also asserted that it already knew of more than 15 custodians that were relevant to its defenses, which included custodians relevant to its on-sale bar defense, its implied license defense and the inventors and witnesses identified by FlashPoint. The Administrative Law Judge was not persuaded. “HTC’s prejudice argument rests largely on the inference that there is a relationship between the asserted patents and the invalidated ‘816 patent such that the asserted patents were likely involved in the same sales activities. The evidence of a relationship between the asserted patents and the ‘816 patent is too attenuated at this point. Aside from the fact that the asserted patents and the ‘816 patent may have been involved in the same project work and that they relate to the same technology (which is distinct from being related patents), HTC has failed to set forth any other specific evidence tying the ‘816 patent to the asserted patents. And without more specific evidence, the evidence about sales activities is largely irrelevant to this investigation. HTC must present something more than mere suspicion based on an unrelated patent covering the same technology in a different investigation — especially in light of the significant relief that it seeks. Moreover, the mere fact that HTC may discovery an on-sale bar does not outweigh the undue burden and expense of unlimited discovery.”
Finally, the Administrative Law Judge concluded that he was confident HTC would find the information it needed or would find enough information that it could make a showing of good cause for additional custodians. “Even if the ALJ considers the additional custodians that HTC describes related to its implied license defense and otherwise, the ALJ is confident that given 15 custodians, HTC will either find the information it suspects, or find enough information to request additional custodians in good faith. If good faith negotiation with Flash Point for additional custodians fails, HTC may move the ALJ to order collection from additional custodians.”
In the Matter of Certain Electronic Imaging Devices, Inv. No. 337-TA-850 (Administrative Law Judge Theodore R. Essex Nov. 19, 2012)
The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. We represent inventors, patent owners and technology companies in patent licensing and litigation. Whether pursuing patent violations or defending infringement claims, we are aggressive and effective advocates for our clients. For more information contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.