Patent Damages

District of Minnesota Orders Production of License Negotiation Documents and Sanctions

The District of Minnesota, in Luminara Worldwide, LLC v. Liown Electronics Co. Ltd. et al., Case No. 14-3103 (Magistrate Judge Noel) (May 18, 2016), granted Defendant’s motion to compel documents related to Plaintiff’s withheld patent license.  Defendant served discovery seeking Plaintiff’s license agreements related to the asserted patent.  Plaintiff did not produce its Memorandum of Understanding or Waiver Agreement with Flipo which included Plaintiff’s agreement to release Flipo and its customer from infringement liability and Plaintiff’s waiver of its enforcement rights against Flipo.  Subsequently, Defendant’s CEO had a conversation with Flipo’s CEO at a trade show in which Flipo’s CEO said that Flipo had taken a license to Plaintiff’s patent.  After a specific request, Plaintiff produced the Memorandum of Understanding and the Waiver Agreement with Flipo, but refused to product all documents related to the those two agreements. 


NDCA allows discovery of settlement agreement

Magistrate Judge Grewal of the Northern District of California, in Good Tech. Corp. v. AirWatch, LLC, Case No. 5-12-cv-05827 (Sept. 25, 2014), issued an order denying a motion for protective order.  There is not document associated with the entry, just a text only entry from the court, which is quoted in full:   


CDCA denies motion to compel production of settlement agreements

On May 29, 2014, Magistrate Judge Mumm of the Central District of California issued a discovery order in In re Katz Interactive Call Processing Litigation, Case No. 07-ML-1816 RGK (FFMx), addressing defendant Echostar’s motion to compel production of settlement agreements by plaintiff.  The issue is a narrow one, but points out the importance of crafting damages-related discovery requests sufficiently broad to capture all kinds of agreements.  The court reviewed the document requests at issue and concluded they were intended to cover license agreements.  The court reasoned that the requests only addressed settlement agreements to the extent they included a license.  The settlement agreements at issue were related to expired patents, and the court concluded they “are not sufficiently related to license agreements to be fairly within the contemplation of the discovery requests.”  Slip op. at 2. The court thus denied Echostar’s motion.



NDCA allows discovery into defendant’s reasonable royalty claims in other actions

On April 22, 2013, the NDCA issued an opinion in Flatworld Interactives LLC v. Apple Inc., Case No. 3-12-cv-01956-JSW-EDL (Doc. No. 111).  The court addressed plaintiff’s motion to compel discovery from Apple.  Several issues were addressed, but the one relevant here involved Flatworld’s motion to compel production of documents relating to Apple’s reasonable royalty claims when asserting its patents in other litigations.  The court granted the motion.  We quote the relevant portion in full:


NDCA allows discovery into sales of non-accused items

On February 26, 2013, the NDCA issued an opinion in Positive Tech., Inc. v. Sony Elecs., Inc., Case No. 11-cv.2226 SI (KAW) (Doc. No. 427).  The court addressed defendants’ joint motion for a protective order barring discovery of sales information for non-accused, collateral products.  The court denied the motion.


DDEL approves case-by-case approach to discovery of license negotiation documents

The District of Delaware in Sciele Pharma, Inc. v. Lupin, LTD, Civil No. 09-37 (RBK/JS) (Redacted Version) (D. Del. January 31, 2013), ruled on plaintiff’s motion seeking production of certain license agreements and related negotiation documents.  The portion of the opinion concerning production of negotiation documents is most interesting.  The court granted the motion as to negotiation documents, but indicated that production in such cases should be based on a case-by-case approach.

Having determined that the defendant was required to produce some license agreements, it was compelled to address plaintiff’s request for the underlying documents, including “negotiations, forecasts and analysis.”  The court noted that there are cases going both ways on settlement negotiation documents, citing:  Tyco Healthcare Group LP v. E-Z-EM, Inc., No. 2:07-cv-262 (tjw), 2010 wl 774878, at *2 (E.D. Tex. March 2, 2010) (ordering production); High Point SARL v. Sprint Nextel Corp., C.A. No. 09-2269-CM-DJW, 2012 WL 1533213 (D. Kan. April 30, 2012) (denying production even though license agreements ordered to be produced).  The court recognized the split was not surprising given the broad discretion afforded courts in deciding discovery issues.

The court declined to adopt a blanket rule on the discoverability of negotiation documents, instead opting for a “case-by-case approach … to determine whether the requested documents were discoverable.”  The court cited Charles E. Hill & Assoc., Inc. v. ABT Elecs., Inc., 854 F. Supp. 2d 427, 429 (E.D. Tex. 2012), in support of this approach.  However, the Delaware court also agreed with Charles E. Hill that “as a general rule license negotiations are less probative and more prejudicial than the licenses themselves,” and that “negotiation documents ‘primarily add heat and not light to an already difficult judicial chore.’”  Slip op. at 10 (quoting Charles E. Hill).


CDCA compels production of IBM cross-licenses and outbound licenses

On August 3, 2012, in Richard C. Williamson v. Citrix Online, LLC, et al., CV 11-02409-AHM (JEMx) (C.D. Cal.), Magistrate Judge McDermott granted the plaintiff’s motion to compel defendant IBM to produce outbound licenses and cross-licenses incorporated into, or used in or with, the accused technology (web conferencing) in response to document requests and an interrogatory.  In an earlier ruling, the court denied plaintiff’s motion to compel, but had based its decision on cases cited by IBM for the first time in a supplemental memorandum to which plaintiff had not responded.  But the denial was without prejudice.  Plaintiff filed its own supplemental memorandum, responding to IBM’s supplement, and then IBM responded to plaintiff.  On further review, the court granted plaintiff’s motion to compel.


NDCA refuses to compel production of license negotiations and license drafts

On June 5, 2012, in Implicit Networks, Inc. v. Juniper Networks, Inc., Case 3:10-cv04234-SI (N.D. Cal.), Judge Illston considered two motions to compel regarding patent licenses.  In the first motion, Implicit argued that Juniper had failed to comply with a request to produce “all license (“in” and “out” and “cross”) regarding computer networking technology.”  The second motion, brought by Juniper, sought production, among other things, of all of Implicit’s licenses, draft licenses, and communications with actual and potential licensees for the purposes of damage calculations.  The court denied both requests.