Powers Letter
This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA
Overview
Download & View Powers Letter as PDF for free.
More details
- Words: 3,089
- Pages: 7
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 1 of 7
WElL, GOTSHAL & MANGES LLP AUSTIN BOSTON
SILICON VALLEY OFFICE
20 I REDWOOD SHORES PARKWAY
BUDAPEST
REDWOOD SHORES, CALIFORNIA 94065
DALLAS
(650) 802-3000
FRANKFURT
FAX: (650) 802-3100
HONG KONG HOUSTON LONDON MIAMI
MUNICH NEW
YORK
PARIS
JARED BOBROW DIRECT LINE (650) 802-3034 E- MAl L: jared. bo brow(§weil. com
Januar 13, 2009
PRAGUE PROVIDENCE SHANGHAI WARSAW
WASHINGTON, D.C.
BY E-FILING AND E-MAIL Honorable Ronald M. Whyte United States District Court Northern District of California 280 South First Street Courtroom 6, 4th Floor San Jose, CA 95113
Re: Rambus v. Micron, et al., No. C 06 00244 (RMW) Dear Judge Whyte:
I write in response to the Court's request that the paries address the procedural and substantive impacts on this case (the '''244 Action") of Judge Robinson's decision in the related case of Micron Technology, Inc. v. Rambus Inc., Civ. No. 00-792-SLR (D.
DeL.) ("Delaware Action") that Rambus's patents are unenforceable based on bad-faith spoliation.
As set forth below, Judge Robinson's decision, and her findings of bad faith spoliation, prejudice, and inadequacy of remedies short of unenforceability, are binding
on Rambus in this action under the doctrine of collateral estoppeL. Based on Judge Robinson's decision, this Court should enter judgment of unenforceability in favor of Micron forthwith. Plainly, Micron should not be par of the upcoming patent trial and the Court should immediately stay those proceedings as to Micron.
This result is fully consistent with Rambus's representations to the Court in this lawsuit prior to the entry of Judge Robinson's order of unenforceability in Delaware. Rambus repeatedly has told this Court that "Micron's unclean hands defense is properly
left for resolution by Judge Robinson of the United States District Court for the District of Delaware, where Micron elected to try these allegations." i Indeed, during a
i E.g., Rambus Inc.'s Motion In Limine NO.5 To Preclude The Manufacturers From Introducing Evidence Related To Rambus' s Document Retention Or Document Destruction, December 7,2007 ('244 D.E. 467)
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 2 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13, 2009 Page 2
pretrial conference in this case, Rambus took the position that "everybody" should have just one shot at trying spoliation and unclean hands: We just tried unclean hands in the Micron case that Micron brought in
Delaware. In my view, that's their - they took their shot at spoliation and
unclean hands and that should be it. They should - the result of the Micron case in Delaware should bind them and they shouldn't come back trying to raise spoliation issues here or trying to retry the issues here.
Everybody should have one shot at it. Nov. 21, 2007 Hearng Tr. at 170:17-171:1; see also 151:12-152:6, 153:1-16 (questions posed by Court) ('244 D.E. 721). Rambus has had its shot. It lost. That should end its
attempts to enforce its patents against Micron. Rambus's new position - that Judge Robinson's decision is not collateral estoppel here - is comlletely lacking in credibility. It also is contrary to law and should be rejected out of hand. I. The Delaware Action
Like this case, the related Delaware Action involves allegations of antitrust, fraud, patent infringement, and spoliation. Micron alleged, among other things, that Rambus violated the Sherman Act through its unfair and anticompetitive efforts to undermne the industry standard setting process and control the high performance DRAM market. Micron seeks, among other remedies, a judgment enjoining Rambus from enforcing its patents based on that misconduct. Micron also alleged that Rambus could not enforce its patents based on unclean hands arsing from its massive and intentional campaign to destroy relevant evidence while it anticipated litigation. For its par, Rambus alleged that
Micron has infringed twelve patents, all of which claim priority to the original Farmwald/orowitz Application (U.S. Patent Application 07/510,898).3 Four of the patents that Rambus asserted against Micron in Delaware also are asserted by Rambus against Micron in this case, namely, U.S. Patent Nos. 6,324,120, 6,378,020, 6,426,916, and 6,452,863, Rambus also alleged in Delaware that Micron is infringing Rambus's
2 Through its new and untenable position, Rambus is seeking to gain tactical advantage
from its decision to file the '244 Action in this Court in 2006, rather than fie its patent claims in Delaware, where the Delaware action between Rambus and Micron had been pending since 2000. Previously, Rambus had acknowledged that it would be unfair and
unnecessary to litigate unclean hands and spoliation against Micron in this forum after those issues had been litigated in Delaware. 3 United States Patent Nos. 5,915,105; 5,953,263; 5,954,804; 5,995,443; 6,032,214; 6,032,215; 6,034,918; 6,038,195; 6,324,120; 6,378,020; 6,426,916; 6,452,863.
2
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 3 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13,2009 Page 3
patents through the manufacture and sale of DRAMs, including DDR2 SDRAM and RLDRAM II. Both of those products also are accused of infringement in this action.
Like this Court, the Court in Delaware trifurcated the proceedings. Under this framework, the Delaware Court decided to try unclean hands and spoliation issues first. The Delaware Court scheduled the patent and conduct phases for trial after the unclean hands and spoliation phase. 3/1612006 Scheduling Order Re-Setting Case for Trial in Delaware Action at 6 (Attachment A to letter).
The unclean hands and spoliation trial commenced before Judge Robinson in November 2007. The five-day bench trial concluded on November 15, 2007. Almost three hundred exhibits were admitted into evidence and the Court heard the testimony of
more than 20 witnesses (many of them live) during the triaL. After the trial was completed, the paries submitted the equivalent of four additional hours of prior testimony from 22 witnesses. Based on this extensive record, and after two rounds of post-trial briefing and two rounds of closing arguments, Judge Robinson issued her
opinion and order that Rambus's patents were unenforceable based on bad-faith spoliation. As par of her ruling, Judge Robinson made specific findings and conclusions that mandate unenforceability in this case, including that (1) Rambus spoliated
documents relevant to Micron's antitrust, unfair competition, patent misuse, and inequitable conduct claims and defenses in bad-faith, (2) Micron has been prejudiced as the result of Rambus's bad faith spoliation, and (3) sanctions other than unenforceabilty were "impractical, bordering on meaningless, under these circumstances." Among her findings and conclusions, Judge Robinson held (at paragraphs 56 and 57 of her opinion):
56. In determning the degree of prejudice suffered by Micron as a result of spoliation of evidence, Micron has cared its burden under Schmid to prove that the documents destroyed were discoverable and the type of
documents that would be relevant to the instant litigation. More specifically, Micron asserts unenforceability due to patent misuse and violation of the antitrust and unfair competition laws (based in part on Rambus' conduct at JEDEC), as well as inequitable conduct. These are defenses that are iluminated by evidence of a non-public nature, e.g., by internal Rambus documents. Because the record demonstrates that there were documents relevant to these defenses, the court concludes that Micron has been prejudiced by Rambus' conduct. That prejudice has been compounded by Rambus' litigation conduct, which has been obstructive at best, misleading at worst.
57. In determning which of the potential sanctions for spoliation should be imposed, the court is directed to find the least harsh sanction that serves both to avoid substantial unfairness to Micron but deter such conduct in 3
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 4 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13, 2009 Page
4
the future. In reviewing the record, the court concludes that the showing of bad faith is so clear and convincing that the showing of prejudice can be proportionally less. The spoliation conduct was extensive, including
within its scope the destruction of innumerable documents relating to all aspects of Rambus' business; when considered in light of Rambus'
litigation conduct, the very integrity of the litigation process has been impugned. Sanctions such as adverse jury instructions and preclusion of evidence are impractical, bordering on meaningless, under these
circumstances and in the context of a typical jury triaL. Therefore, the court concludes that the appropriate sanction for the conduct of record is to declare the patents in suit unenforceable against Micron. II. Under Collateral Estoppel, The Court Should Enter Judgment Of
Unenforceabilty Against Rambus In This Action Micron and Rambus had a full and fair opportunity to litigate the issues related to
Rambus's bad faith spoliation in Delaware. Judge Robinson's decision on the issue, based on a lengthy record after five full days of trial and supported by 33 pages of findings and conclusions, renders Rambus' s patents asserted against Micron in the '244 Action unenforceable under the doctrine of mutua14 collateral estoppeL.
Collateral estoppel serves to "relieve paries of the cost and vexation of multiple lawsuits, conserve judicial resources, and, by preventing inconsistent decisions,
encourage reliance on adjudication." United States v. Mendoza, 464 U.S. 154, 158 (1984) (quoting Allen v. McCurry, 449 U.S. 90, 94 (1980)). Collateral estoppel applies where (1) there was a full and fair opportunity to litigate the issue in the previous action; (2) the issue was actually litigated in that action; (3) the issue was lost as a result of a
final judgment in that action; and (4) the person against whom collateral estoppel is asserted in the present action was party or in privity with a pary in the previous action, Pena v. Gardner, 976 F.2d 469, 472 (9th Cir. 1992). Collateral estoppel precludes relitigation both of findings of fact and conclusions of law. Segal v. American Tel. & TeL.
Co., 606 F.2d 842, 845 (9th Cir. 1979) (collateral estoppel, or issue preclusion, bars relitigation, even in an action on a different claim, of all "issues of fact or law that were actually litigated and necessarly decided" in the prior proceeding); see also Dodd v. Hood River County, 59 F.3d 852, 863 (9th Cir. 1995).
4 The situation for Micron is distinguishable from the instances of collateral estoppel previously considered by the Court in Hynix I, because here there is mutuality of paries. In other words, both Rambus and Micron are paries to both proceedings. 4
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 5 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13,2009 Page 5
Here, Micron and Rambus had a full and fair opportunity to litigate unclean hands and spoliation issues in Delaware. Judge Robinson has issued a final decision on those issues after a bench trial and extensive briefing and argument. The spoliation issues that were litigated in Delaware are the same as those to be litigated in this case. E.g., Apr. 24,
2007 Joint Case Management Order at 1-2 ("any claim or defense ... that is based on allegations of Rambus's destruction of documents, litigation misconduct, or spoliation of evidence... shall be adjudicated separately from the Januar 22 (Conduct) Trial and the
05-06 Patent trial(s).") ('244 D.E. 70) Moreover, her findings and conclusions of bad faith, prejudice, and inadequacy of remedies other than unenforceabilty are binding here as welL. Judge Robinson specifically found that Rambus intentionally destroyed evidence relevant to Micron's antitrust, unfair competition, patent misuse, and inequitable conduct claims and defenses - many of the very issues that Micron was forced to try in early 2008
without relevant evidence from Rambus. Plainly, Micron is entitled to a judgment of unenforceability in this action. As noted above, Rambus agreed - before Judge Robinson entered her findings and conclusions - that Rambus and Micron should be bound in this case by the result in
the Delaware case. During the paries' meet and confer last night, Rambus changed its tune and now argues that collateral estoppel should not apply. Rambus's self-serving change in position should be rejected.
First, Rambus argued that Judge Robinson's decision is not final for purposes of collateral estoppeL. Rambus is wrong as a matter of law. In the Ninth Circuit, a "final judgment" "includes any prior adjudication of an issue in another action that is determned to be sufficiently firm to be accorded conclusive effect." In re Lockard, 884 F.2d 1171, 1175 (9th Cir. 1989). A decision is "sufficiently firm" to constitute a final judgment, even if it cannot yet be appealed, where the order is supported by a reasoned opinion that is not "avowedly tentative" and where "the paries were fully heard." Sec. People, Inc. v. Medeco Sec. Locks, Inc., 59 F. Supp. 2d 1040, 1045-46 (N.D. CaL. 1999)
(holding order was "suffciently firm"); see also Robi v. Five Platters, Inc., 838 F.2d 318, 327 (9th Cir. 1988) (finding judgments "suffciently firm"). Here, as explained above, Judge Robinson's decision is based on an extensive record. Judge Robinson's ruling is supported by 33 pages of detailed factual findings and legal conclusions. She has entered enforceabilty confirmng that the ruling is not tentative. There is nothing remaining to litigate on these issues. As such, Judge Robinson's ruling constitutes a final an order of un
judgment for collateral estoppel purposes.
Second, Rambus argued that the issues in Delaware are not identical to the issues here because the two actions do not involve identical patents and products. Not only is this position contrar to Rambus's earlier representations to the Court that the Delaware case would resolve the unclean hands issues between the paries (e.g., that "Micron's unclean hands defense is properly left for resolution by Judge Robinson"), but it is wrong 5
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 6 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13, 2009 Page 6
as a matter of law. The factors demonstrating that issues are the identical for purposes of collateral estoppel include (1) substantial overlap between the evidence or argument, (2) application of the same rule of law, (3) similar pretrial preparation and discovery, and (4) relatedness of claims in the proceedings. See Kamilche Co. v. United States, 53 F.3d 1059, 1062 (9th Cir. 1995), amended by 75 F.3d 1391 (9th Cir. 1996). There can be no dispute that these four factors are met here. The spoliation issues that Judge Robinson adjudicated against Rambus - that Rambus acted in bad faith, that relevant evidence was intentionally destroyed, that Micron has been prejudiced, and that unenforceability is the only just remedy - are the same issues that Micron would ask this
Court to adjudicate in the third phase of the '244 Action. The rules of law - unclean hands and spoliation - are the same. Pretrial preparation and discovery are the same.
And the claims and defenses in the two proceedings are closely related. The antitrust,
unfair competition, and patent misuse claims and defenses arse from the same set of core facts, and the relief that Micron seeks in both cases from Rambus's anticompetitive
enforceability of Rambus's patents - is the same. The patents that Judge Robinson found to be unenforceable in Delaware are either identical to those in suit here or stem from the same Farwald/orowitz patent application. The spoliation of Rambus's patent application files (Decision at 18 n.42) applies equally here, because the conduct - un
spoliated files were for applications that led to the twelve patents in Delaware and the ten patents-in-suit here. The products at issue in the two cases substantially overlap, with
both DDR2 SDRAM and RLDRAM II being at issue in Delaware and California. Thus, Judge Robinson's finding that Rambus destroyed evidence relevant to Micron's antitrust, unfair competition, patent misuse, and inequitable conduct claims and defenses is fully applicable here.5
Based on the collateral estoppel effect of Judge Robinson's findings, all of the patents-in-suit in this action should be found unenforceable. The Ninth Circuit has held that findings of bad faith, prejudice, and the inadequacy of lesser sanctions are alone
sufficient to support dismissal of a lawsuit for spoliation of evidence. Leon v. IDX Systems Corp., 464 F.3d 951 (9th Cir. 2006) (affirmng lower court's dismissal of a pary's claim due to its spoliation of evidence). Based on Leon, Judge Robinson's
findings of Rambus's bad faith, the prejudice to Micron, and the inadequacy of a sanction less than un
enforceability, once given collateral estoppel effect, compel a determnation
that all the patents-in-suit are unenforceable.
5 Rambus cannot seriously claim that had the six additional patents at issue here been at
issue in Delaware, Judge Robinson would have reached a different result. Her findings and conclusions of bad faith, prejudice, and appropriate sanction apply whether those six patents had been in suit or not. 6
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 7 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13,2009 Page 7
Finally, Rambus argued during the meet and confer that the Court should exercise
its discretion not to apply collateral estoppel in this case. In makng this argument, Rambus ignores the fact that the application of collateral estoppel here is mutual. That is,
Rambus and Micron are paries to the Delaware case and are paries to the '244 Case. Given that the application of collateral estoppel here is mutual, the policy concerns over applying offensive non-mutual collateral estoppel do not apply and the Court does not have the same discretion in whether to apply collateral estoppel. See Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 331 (1979) (giving a court broad discretion only in whether to apply offensive non-mutual collateral estoppei).6 III. Procedural Impact Of The Delaware Decision
Based on the collateral estoppel effect of Judge Robinson's decision, Micron
requests that the Court enter judgment of unenforceability against Rambus in the '244 Action forthwith. Plainly, the '244 Action should be cared out of the upcoming trial proceedings and all such proceedings as to Micron should be stayed forthwith. There is
simply no reason to proceed with the patent trial against Micron in light of Judge Robinson's ruling. To the extent the Court determines that a formal motion or further briefing are necessary as to Micron, an appropriate schedule should be ente ed.
cc: Gregory P. Stone (Email: Gregory.Stoneêmto.com)
Theodore G. Brown (Email: tgbrownêtownsend.com) Ken Nissly (Email: knisslyêomm.com) Bob Freitas (Email: rfreitasêorrick.com)
Matthew D. Powers (Email: Matthew.Powersêweil.com) Steven S. Cherensky (Email: Steven.Cherenskyêweil.com) David J. Lender (Email: David.Lenderêweil.com) Sven Raz (Email: Sven.Razêweil.com)
6 In addition, because Micron is a defendant in this action and is asserting unclean hands
and spoliation as a defense, the collateral estoppel here is defensive, not offensive, which further renders Parklane's discussion of discretion inapplicable. U.S. v. Mendoza, 464 U.S. 154, 159 nA (1984).
7
Document 3105
Filed 01/13/2009
Page 1 of 7
WElL, GOTSHAL & MANGES LLP AUSTIN BOSTON
SILICON VALLEY OFFICE
20 I REDWOOD SHORES PARKWAY
BUDAPEST
REDWOOD SHORES, CALIFORNIA 94065
DALLAS
(650) 802-3000
FRANKFURT
FAX: (650) 802-3100
HONG KONG HOUSTON LONDON MIAMI
MUNICH NEW
YORK
PARIS
JARED BOBROW DIRECT LINE (650) 802-3034 E- MAl L: jared. bo brow(§weil. com
Januar 13, 2009
PRAGUE PROVIDENCE SHANGHAI WARSAW
WASHINGTON, D.C.
BY E-FILING AND E-MAIL Honorable Ronald M. Whyte United States District Court Northern District of California 280 South First Street Courtroom 6, 4th Floor San Jose, CA 95113
Re: Rambus v. Micron, et al., No. C 06 00244 (RMW) Dear Judge Whyte:
I write in response to the Court's request that the paries address the procedural and substantive impacts on this case (the '''244 Action") of Judge Robinson's decision in the related case of Micron Technology, Inc. v. Rambus Inc., Civ. No. 00-792-SLR (D.
DeL.) ("Delaware Action") that Rambus's patents are unenforceable based on bad-faith spoliation.
As set forth below, Judge Robinson's decision, and her findings of bad faith spoliation, prejudice, and inadequacy of remedies short of unenforceability, are binding
on Rambus in this action under the doctrine of collateral estoppeL. Based on Judge Robinson's decision, this Court should enter judgment of unenforceability in favor of Micron forthwith. Plainly, Micron should not be par of the upcoming patent trial and the Court should immediately stay those proceedings as to Micron.
This result is fully consistent with Rambus's representations to the Court in this lawsuit prior to the entry of Judge Robinson's order of unenforceability in Delaware. Rambus repeatedly has told this Court that "Micron's unclean hands defense is properly
left for resolution by Judge Robinson of the United States District Court for the District of Delaware, where Micron elected to try these allegations." i Indeed, during a
i E.g., Rambus Inc.'s Motion In Limine NO.5 To Preclude The Manufacturers From Introducing Evidence Related To Rambus' s Document Retention Or Document Destruction, December 7,2007 ('244 D.E. 467)
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 2 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13, 2009 Page 2
pretrial conference in this case, Rambus took the position that "everybody" should have just one shot at trying spoliation and unclean hands: We just tried unclean hands in the Micron case that Micron brought in
Delaware. In my view, that's their - they took their shot at spoliation and
unclean hands and that should be it. They should - the result of the Micron case in Delaware should bind them and they shouldn't come back trying to raise spoliation issues here or trying to retry the issues here.
Everybody should have one shot at it. Nov. 21, 2007 Hearng Tr. at 170:17-171:1; see also 151:12-152:6, 153:1-16 (questions posed by Court) ('244 D.E. 721). Rambus has had its shot. It lost. That should end its
attempts to enforce its patents against Micron. Rambus's new position - that Judge Robinson's decision is not collateral estoppel here - is comlletely lacking in credibility. It also is contrary to law and should be rejected out of hand. I. The Delaware Action
Like this case, the related Delaware Action involves allegations of antitrust, fraud, patent infringement, and spoliation. Micron alleged, among other things, that Rambus violated the Sherman Act through its unfair and anticompetitive efforts to undermne the industry standard setting process and control the high performance DRAM market. Micron seeks, among other remedies, a judgment enjoining Rambus from enforcing its patents based on that misconduct. Micron also alleged that Rambus could not enforce its patents based on unclean hands arsing from its massive and intentional campaign to destroy relevant evidence while it anticipated litigation. For its par, Rambus alleged that
Micron has infringed twelve patents, all of which claim priority to the original Farmwald/orowitz Application (U.S. Patent Application 07/510,898).3 Four of the patents that Rambus asserted against Micron in Delaware also are asserted by Rambus against Micron in this case, namely, U.S. Patent Nos. 6,324,120, 6,378,020, 6,426,916, and 6,452,863, Rambus also alleged in Delaware that Micron is infringing Rambus's
2 Through its new and untenable position, Rambus is seeking to gain tactical advantage
from its decision to file the '244 Action in this Court in 2006, rather than fie its patent claims in Delaware, where the Delaware action between Rambus and Micron had been pending since 2000. Previously, Rambus had acknowledged that it would be unfair and
unnecessary to litigate unclean hands and spoliation against Micron in this forum after those issues had been litigated in Delaware. 3 United States Patent Nos. 5,915,105; 5,953,263; 5,954,804; 5,995,443; 6,032,214; 6,032,215; 6,034,918; 6,038,195; 6,324,120; 6,378,020; 6,426,916; 6,452,863.
2
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 3 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13,2009 Page 3
patents through the manufacture and sale of DRAMs, including DDR2 SDRAM and RLDRAM II. Both of those products also are accused of infringement in this action.
Like this Court, the Court in Delaware trifurcated the proceedings. Under this framework, the Delaware Court decided to try unclean hands and spoliation issues first. The Delaware Court scheduled the patent and conduct phases for trial after the unclean hands and spoliation phase. 3/1612006 Scheduling Order Re-Setting Case for Trial in Delaware Action at 6 (Attachment A to letter).
The unclean hands and spoliation trial commenced before Judge Robinson in November 2007. The five-day bench trial concluded on November 15, 2007. Almost three hundred exhibits were admitted into evidence and the Court heard the testimony of
more than 20 witnesses (many of them live) during the triaL. After the trial was completed, the paries submitted the equivalent of four additional hours of prior testimony from 22 witnesses. Based on this extensive record, and after two rounds of post-trial briefing and two rounds of closing arguments, Judge Robinson issued her
opinion and order that Rambus's patents were unenforceable based on bad-faith spoliation. As par of her ruling, Judge Robinson made specific findings and conclusions that mandate unenforceability in this case, including that (1) Rambus spoliated
documents relevant to Micron's antitrust, unfair competition, patent misuse, and inequitable conduct claims and defenses in bad-faith, (2) Micron has been prejudiced as the result of Rambus's bad faith spoliation, and (3) sanctions other than unenforceabilty were "impractical, bordering on meaningless, under these circumstances." Among her findings and conclusions, Judge Robinson held (at paragraphs 56 and 57 of her opinion):
56. In determning the degree of prejudice suffered by Micron as a result of spoliation of evidence, Micron has cared its burden under Schmid to prove that the documents destroyed were discoverable and the type of
documents that would be relevant to the instant litigation. More specifically, Micron asserts unenforceability due to patent misuse and violation of the antitrust and unfair competition laws (based in part on Rambus' conduct at JEDEC), as well as inequitable conduct. These are defenses that are iluminated by evidence of a non-public nature, e.g., by internal Rambus documents. Because the record demonstrates that there were documents relevant to these defenses, the court concludes that Micron has been prejudiced by Rambus' conduct. That prejudice has been compounded by Rambus' litigation conduct, which has been obstructive at best, misleading at worst.
57. In determning which of the potential sanctions for spoliation should be imposed, the court is directed to find the least harsh sanction that serves both to avoid substantial unfairness to Micron but deter such conduct in 3
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 4 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13, 2009 Page
4
the future. In reviewing the record, the court concludes that the showing of bad faith is so clear and convincing that the showing of prejudice can be proportionally less. The spoliation conduct was extensive, including
within its scope the destruction of innumerable documents relating to all aspects of Rambus' business; when considered in light of Rambus'
litigation conduct, the very integrity of the litigation process has been impugned. Sanctions such as adverse jury instructions and preclusion of evidence are impractical, bordering on meaningless, under these
circumstances and in the context of a typical jury triaL. Therefore, the court concludes that the appropriate sanction for the conduct of record is to declare the patents in suit unenforceable against Micron. II. Under Collateral Estoppel, The Court Should Enter Judgment Of
Unenforceabilty Against Rambus In This Action Micron and Rambus had a full and fair opportunity to litigate the issues related to
Rambus's bad faith spoliation in Delaware. Judge Robinson's decision on the issue, based on a lengthy record after five full days of trial and supported by 33 pages of findings and conclusions, renders Rambus' s patents asserted against Micron in the '244 Action unenforceable under the doctrine of mutua14 collateral estoppeL.
Collateral estoppel serves to "relieve paries of the cost and vexation of multiple lawsuits, conserve judicial resources, and, by preventing inconsistent decisions,
encourage reliance on adjudication." United States v. Mendoza, 464 U.S. 154, 158 (1984) (quoting Allen v. McCurry, 449 U.S. 90, 94 (1980)). Collateral estoppel applies where (1) there was a full and fair opportunity to litigate the issue in the previous action; (2) the issue was actually litigated in that action; (3) the issue was lost as a result of a
final judgment in that action; and (4) the person against whom collateral estoppel is asserted in the present action was party or in privity with a pary in the previous action, Pena v. Gardner, 976 F.2d 469, 472 (9th Cir. 1992). Collateral estoppel precludes relitigation both of findings of fact and conclusions of law. Segal v. American Tel. & TeL.
Co., 606 F.2d 842, 845 (9th Cir. 1979) (collateral estoppel, or issue preclusion, bars relitigation, even in an action on a different claim, of all "issues of fact or law that were actually litigated and necessarly decided" in the prior proceeding); see also Dodd v. Hood River County, 59 F.3d 852, 863 (9th Cir. 1995).
4 The situation for Micron is distinguishable from the instances of collateral estoppel previously considered by the Court in Hynix I, because here there is mutuality of paries. In other words, both Rambus and Micron are paries to both proceedings. 4
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 5 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13,2009 Page 5
Here, Micron and Rambus had a full and fair opportunity to litigate unclean hands and spoliation issues in Delaware. Judge Robinson has issued a final decision on those issues after a bench trial and extensive briefing and argument. The spoliation issues that were litigated in Delaware are the same as those to be litigated in this case. E.g., Apr. 24,
2007 Joint Case Management Order at 1-2 ("any claim or defense ... that is based on allegations of Rambus's destruction of documents, litigation misconduct, or spoliation of evidence... shall be adjudicated separately from the Januar 22 (Conduct) Trial and the
05-06 Patent trial(s).") ('244 D.E. 70) Moreover, her findings and conclusions of bad faith, prejudice, and inadequacy of remedies other than unenforceabilty are binding here as welL. Judge Robinson specifically found that Rambus intentionally destroyed evidence relevant to Micron's antitrust, unfair competition, patent misuse, and inequitable conduct claims and defenses - many of the very issues that Micron was forced to try in early 2008
without relevant evidence from Rambus. Plainly, Micron is entitled to a judgment of unenforceability in this action. As noted above, Rambus agreed - before Judge Robinson entered her findings and conclusions - that Rambus and Micron should be bound in this case by the result in
the Delaware case. During the paries' meet and confer last night, Rambus changed its tune and now argues that collateral estoppel should not apply. Rambus's self-serving change in position should be rejected.
First, Rambus argued that Judge Robinson's decision is not final for purposes of collateral estoppeL. Rambus is wrong as a matter of law. In the Ninth Circuit, a "final judgment" "includes any prior adjudication of an issue in another action that is determned to be sufficiently firm to be accorded conclusive effect." In re Lockard, 884 F.2d 1171, 1175 (9th Cir. 1989). A decision is "sufficiently firm" to constitute a final judgment, even if it cannot yet be appealed, where the order is supported by a reasoned opinion that is not "avowedly tentative" and where "the paries were fully heard." Sec. People, Inc. v. Medeco Sec. Locks, Inc., 59 F. Supp. 2d 1040, 1045-46 (N.D. CaL. 1999)
(holding order was "suffciently firm"); see also Robi v. Five Platters, Inc., 838 F.2d 318, 327 (9th Cir. 1988) (finding judgments "suffciently firm"). Here, as explained above, Judge Robinson's decision is based on an extensive record. Judge Robinson's ruling is supported by 33 pages of detailed factual findings and legal conclusions. She has entered enforceabilty confirmng that the ruling is not tentative. There is nothing remaining to litigate on these issues. As such, Judge Robinson's ruling constitutes a final an order of un
judgment for collateral estoppel purposes.
Second, Rambus argued that the issues in Delaware are not identical to the issues here because the two actions do not involve identical patents and products. Not only is this position contrar to Rambus's earlier representations to the Court that the Delaware case would resolve the unclean hands issues between the paries (e.g., that "Micron's unclean hands defense is properly left for resolution by Judge Robinson"), but it is wrong 5
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 6 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13, 2009 Page 6
as a matter of law. The factors demonstrating that issues are the identical for purposes of collateral estoppel include (1) substantial overlap between the evidence or argument, (2) application of the same rule of law, (3) similar pretrial preparation and discovery, and (4) relatedness of claims in the proceedings. See Kamilche Co. v. United States, 53 F.3d 1059, 1062 (9th Cir. 1995), amended by 75 F.3d 1391 (9th Cir. 1996). There can be no dispute that these four factors are met here. The spoliation issues that Judge Robinson adjudicated against Rambus - that Rambus acted in bad faith, that relevant evidence was intentionally destroyed, that Micron has been prejudiced, and that unenforceability is the only just remedy - are the same issues that Micron would ask this
Court to adjudicate in the third phase of the '244 Action. The rules of law - unclean hands and spoliation - are the same. Pretrial preparation and discovery are the same.
And the claims and defenses in the two proceedings are closely related. The antitrust,
unfair competition, and patent misuse claims and defenses arse from the same set of core facts, and the relief that Micron seeks in both cases from Rambus's anticompetitive
enforceability of Rambus's patents - is the same. The patents that Judge Robinson found to be unenforceable in Delaware are either identical to those in suit here or stem from the same Farwald/orowitz patent application. The spoliation of Rambus's patent application files (Decision at 18 n.42) applies equally here, because the conduct - un
spoliated files were for applications that led to the twelve patents in Delaware and the ten patents-in-suit here. The products at issue in the two cases substantially overlap, with
both DDR2 SDRAM and RLDRAM II being at issue in Delaware and California. Thus, Judge Robinson's finding that Rambus destroyed evidence relevant to Micron's antitrust, unfair competition, patent misuse, and inequitable conduct claims and defenses is fully applicable here.5
Based on the collateral estoppel effect of Judge Robinson's findings, all of the patents-in-suit in this action should be found unenforceable. The Ninth Circuit has held that findings of bad faith, prejudice, and the inadequacy of lesser sanctions are alone
sufficient to support dismissal of a lawsuit for spoliation of evidence. Leon v. IDX Systems Corp., 464 F.3d 951 (9th Cir. 2006) (affirmng lower court's dismissal of a pary's claim due to its spoliation of evidence). Based on Leon, Judge Robinson's
findings of Rambus's bad faith, the prejudice to Micron, and the inadequacy of a sanction less than un
enforceability, once given collateral estoppel effect, compel a determnation
that all the patents-in-suit are unenforceable.
5 Rambus cannot seriously claim that had the six additional patents at issue here been at
issue in Delaware, Judge Robinson would have reached a different result. Her findings and conclusions of bad faith, prejudice, and appropriate sanction apply whether those six patents had been in suit or not. 6
Case 5:05-cv-00334-RMW
Document 3105
Filed 01/13/2009
Page 7 of 7
WElL, GOTSHAL & MANGES LLP
Honorable Ronald M. Whyte January 13,2009 Page 7
Finally, Rambus argued during the meet and confer that the Court should exercise
its discretion not to apply collateral estoppel in this case. In makng this argument, Rambus ignores the fact that the application of collateral estoppel here is mutual. That is,
Rambus and Micron are paries to the Delaware case and are paries to the '244 Case. Given that the application of collateral estoppel here is mutual, the policy concerns over applying offensive non-mutual collateral estoppel do not apply and the Court does not have the same discretion in whether to apply collateral estoppel. See Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 331 (1979) (giving a court broad discretion only in whether to apply offensive non-mutual collateral estoppei).6 III. Procedural Impact Of The Delaware Decision
Based on the collateral estoppel effect of Judge Robinson's decision, Micron
requests that the Court enter judgment of unenforceability against Rambus in the '244 Action forthwith. Plainly, the '244 Action should be cared out of the upcoming trial proceedings and all such proceedings as to Micron should be stayed forthwith. There is
simply no reason to proceed with the patent trial against Micron in light of Judge Robinson's ruling. To the extent the Court determines that a formal motion or further briefing are necessary as to Micron, an appropriate schedule should be ente ed.
cc: Gregory P. Stone (Email: Gregory.Stoneêmto.com)
Theodore G. Brown (Email: tgbrownêtownsend.com) Ken Nissly (Email: knisslyêomm.com) Bob Freitas (Email: rfreitasêorrick.com)
Matthew D. Powers (Email: Matthew.Powersêweil.com) Steven S. Cherensky (Email: Steven.Cherenskyêweil.com) David J. Lender (Email: David.Lenderêweil.com) Sven Raz (Email: Sven.Razêweil.com)
6 In addition, because Micron is a defendant in this action and is asserting unclean hands
and spoliation as a defense, the collateral estoppel here is defensive, not offensive, which further renders Parklane's discussion of discretion inapplicable. U.S. v. Mendoza, 464 U.S. 154, 159 nA (1984).
7
Related Documents
Powers Letter
December 2019 26
Powers Letter A
December 2019 27
Powers
October 2019 48
Powers
November 2019 36
Powers
December 2019 35
