Qualcomm Lawyers Taken to the Woodshed Over Discovery Conduct

It may take a while to erase the black mark two San Francisco law firms -- and their client, Qualcomm Inc. -- received Monday courtesy of a San Diego federal judge, but the company and firms have all vowed to fight.
In a strongly worded 54-page ruling, San Diego federal Judge Rudi Brewster accused Qualcomm and its trial counsel of committing "gross litigation misconduct" by withholding crucial evidence in Qualcomm's patent infringement case against Broadcom Corp. Though the judge did not identify the law firms by name, he specifically referred to Qualcomm's representation up until the spring of this year, a time when the company was represented by Heller Ehrman and Day Casebeer Madrid & Batchelder.
Heller partner Stanley Young and Day Casebeer partner James Batchelder were among the outside counsel representing Qualcomm.
Brewster criticized "Qualcomm's constant stonewalling, concealment and repeated misrepresentations" during discovery, scolded the company's "presentation of numerous witnesses who steadfastly testified falsely" and condemned its counsel, which "adamantly denied the obvious, and then, when the truth was discovered and exposed by the document production, sequentially contended denial of relevance, justification, mistake, and finally non-awareness."
Brewster ordered Qualcomm to pay all Broadcom's litigation fees, which David Rosmann, vice president of intellectual property litigation for Broadcom, said could be around $10 million. The judge also disqualified two of Qualcomm's patents.
He is expected to issue a ruling in the next couple of weeks on possible sanctions against Qualcomm and its attorneys.
Wilmer Cutler Pickering Hale and Dorr represented Broadcom in the litigation.
Broadcom is seeking an evidentiary hearing to find out how the evidence came to be concealed, Rosmann said. The company is also asking for a discovery master to monitor Qualcomm's conduct in other litigation. "I think they've proven they really can't be trusted," Rosmann said.
After Qualcomm was found to be infringing on a Broadcom patent in a separate case, the International Trade Commission issued a ban in June on the importation of cell phones using Qualcomm chips that infringe on the patent. On Monday, the Bush administration declined to reverse that ban.
In a statement on Brewster's ruling, Qualcomm said it "respectfully disagrees with the court's findings" and intends to appeal them.
"Qualcomm acknowledges the seriousness of the court's findings and reiterates its previous apology to the court for the errors made during discovery and for the inaccurate testimony of certain of its witnesses," the statement read.
Qualcomm originally accused rival chip maker Broadcom of infringing on several of its patents that dealt with transmission of video data. Broadcom prevailed in a January trial, yet sought additional relief when it was revealed during trial that Qualcomm engineers had participated in industrywide meetings to set a common standard for video transmission.
If Qualcomm participated in such standards-setting, then its patents could be voided.
Before and throughout most of the trial, Qualcomm denied that its engineers had consulted with the standards body during the relevant years and resisted turning over more information about its involvement.
"Qualcomm counsel produced none of the over two hundred thousand pages of emails and electronic documents ... which were clearly within the scope of the requests and that were finally produced four months post-trial," Brewster wrote. Those e-mails detailed Qualcomm's involvement with the standards-setting group.
The judge rejected an apparent contention that Qualcomm had misled its lawyers about what evidence was available.
"Qualcomm counsel's indefensible discovery conduct belie counsel's later implied protestation of having been 'kept in the dark' by their client," the judge wrote.
Day Casebeer's Batchelder and Qualcomm's general counsel, Louis Lupin, sent letters of apology to the court in April, saying they failed to do a detailed enough keyword search of Qualcomm e-mails.
Batchelder was out of town Tuesday and was not available to comment. His colleague Craig Casebeer declined to comment Tuesday and referred to Qualcomm's released statement.
Although Brewster didn't name him, the judge accused Heller's Young of first telling the court that the relevant e-mails did not exist. But Young then changed his stance, Brewster wrote, saying he was somehow "not cognizant" of the e-mails -- even though Young admitted "there was fleeting mention" of e-mails in his presence.
Young released a statement on behalf of his firm denying any allegations that it knowingly misled the court.
"The arguments that Heller Ehrman made during the course of the Qualcomm litigation were based on the facts as Heller Ehrman understood them," the statement read. Young also said the firm was not in charge of responding to requests for evidence about Qualcomm's consulting in the standard-setting body.
According to State Bar of California rules, judges are required to notify the Bar of sanctions against an attorney -- but not if those sanctions are imposed only because of failure to comply with discovery orders.