Willfulness & Privilege WaiverDefendants tell you that they had done the responsible thing and...

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Willfulness & Privilege WaiverAdvanced Patent Law Institute

December 2019

Willfulness impact on liability is the primary concern…not trebling

2012–17 jury trial infringement rate

(willfulness not tried)

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Willfulness accusation increases risk of infringement finding

post-Halo jury trialinfringement rate, (willfulness tried)

2012–17 jury trial infringement rate


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Willfulness increases risk of infringement

post-Halo jury trialinfringement rate, (willfulness tried)

post-Halo jury trial infringement rate


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Chris Ritter, The Focal Point LLC

Jurors are paying attention—because the rest is boring

“Willfulness and the associated issue of motive/intent are often more interesting to jurors than the highly technical issues.As a result, some jurors are going to find it easier to focus on, rely, and analyze the case based on the willfulness evidence.”

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Jury instructions parrot Halo . . .

Polara Engineering, Inc. v. Campbell Co., Case No. CV-13-0007 (C.D.Cal. Jun. 29, 2016)

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. . . and make things worse


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NDCA Model Jury Instructions

In deciding whether [alleged infringer] willfully infringed, you should consider all of the facts surrounding the infringement including: • whether [alleged infringer] intentionally copied [patent

holder’s] patented technology in developing the accused product [method];

• whether [alleged infringer knew, or should have known, that its conduct involved an unreasonable risk of infringement; and

• whether [alleged infringer] had a reasonable belief that at the time of infringement that its products did not infringe the asserted patent [or that the patent was invalid].

NDCA Model Jury Instructions (cont)

Although there was no obligation on [alleged infringer] to have obtained an opinion of counsel, you may consider

• whether [alleged infringer] relied on a legal opinion that was well-supported and believable and

• that advised [alleged infringer:] – (1) that the [product] [method] did not infringe

[patent holder]’s patent or – (2) that the patent was invalid [or unenforceable].

. . . but some courts do keep it short

Simo Holdings, Inc. v. H.K. uCloudlink Network Tech. Ltd. Case No. 1:18-cv-05427-JSR (S.D.N.Y. June 15, 2018).

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Recap—You need witnesses for . . .

1. Did you act consistent with the standards of commerce in your industry?2. Whether you intentionally copied the patented technology?3. Whether you made a good faith effort to avoid infringement upon learning

of the patent?4. Whether you reasonably believed (1) that you had a substantial defense to

infringement and (2) that the defense would be successful if litigated?5. Did you rely on a legal opinion that was well-supported and reasonable?

The new reality is about admissibleevidence at the jury phase

“Despite knowing of Plaintiff’s patents since at least April 2011, Defendants never undertook any serious investigation to form a good-faith belief as to non-infringement or invalidity.”

Imperium IP Holdings v. Samsung Electronics Co.,No. 4:14-CV-371 (E.D. Tex. Aug. 24, 2016)

(emphasis added)

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…and silence might imply willfulness?

“[T]he Court notes that [defendant] did not introduce any evidence establishing when it learned of the [Patent]…. While [defendant] was, of course, not obligated to do so... the absence of countervailing evidence is relevant to the determination of whether the jury’s [willfulness] verdict was permissible.”

Simo Holdings, Inc. v. H.K. uCloudlink Network Tech. Ltd.396 F. Supp. 3d 323 (S.D.N.Y. Aug. 28, 2019)

(emphasis added)

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Single witness can make the difference

Frustration and distrust of corporations is palpable, no matter what the case themes are and no matter what the venue–across the country people have learned you cannot trust corporations to do the right thing. Position your client as being distinct from that untrustworthy norm. Sometimes, all it takes is a single witness who is seen by the jurors as ethically solid, credible, knowledgeable and honest for them to find for that party.

Keene Trial Consulting

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Will they trust your in-house attorney?

The fourth corner lists the ambivalently perceived high-competence, low-warmth, "envied" professions: lawyers, chief executive officers, engineers, accountants, scientists, and researchers. They earn respect but not trust. Being seen as competent but cold might not seem problematic until one recalls that communicator credibility requires not just status and expertise (competence) but also trustworthiness (warmth).

Fiske and Dupree, Princeton University

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Who will the jury really trust?

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Fiske, S.T. & C. Dupree, Gaining trust as well as respect in communicating to motivated audiences about sciencetopics, Proc. of Nat. Academies of Sciences 111 Supp. 4 (2014)

Closing quotes: If they actually cared, they would have opinions of counsel

And the final question I would like to pose is: Where are opinions ofcounsel? Where are these Defendants able to show you that theyconsulted with legal counsel to get an opinion from them aboutwhether or not they infringed or whether or not they patents wereinvalid?

We saw testimony from a lawyer inside Dell. He didn’t tell you that hehad formed any opinion at all and informed his superiors at Dell: “Don’tworry; it’s okay; we don’t infringe.” He didn’t say that.

And you never heard anybody from D-Link or NETGEAR or any of theseDefendants tell you that they had done the responsible thing andconsulted attorneys to study the patents to advise them that theydidn’t infringe.

Ericsson v. D-Link22

Closing quotes: They did nothing after being sued

But more, the point here on willfulness is also, whathappened after Interactive Media was sued? AfterIOENGINE filed the complaint in this case, as theevidence showed, Interactive Media took no action,no action to change its products, no action to avoidinfringement, no action to even analyze whetherinfringement was occurring. And that, we submit,supports a conclusion of willfulness as well.

Ioengine v. Interactive Media

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Closing quotes: They just don’t care

You can’t stick your head in the sand, and then say: “Oh, we don’tinfringe.”

Because Mr. Kennelly said he hadn’t bothered to look at the patents uptill two weeks ago when he had his deposition taken. The CEO, whothey brought in here to testify said he had not even bothered to look atthe patents.

He looked at them a week before trial because he knew he would beasked that question again, and then he kept saying: “Oh yeah, I lookedat the patents, and ladies and gentlemen, I can tell you we don’tinfringe.” Looked at them a week before trial. This lawsuit has beenpending for two years.

Realtime v. Actian

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Closing quotes: If they did not willfully infringe, they would have told you that

Their origin story is completely unknown.

And where are uCloudlink’s witness to defend their actions? The onlytwo witnesses you saw were highly paid consultants.

UCloudlink cannot bring one person to talk about how its infringinghotspots came to be. None of them were brave enough to come hereand face cross-examination from our team.

None of them said we didn’t copy. None of them said, we didn’twillfully infringe. Their only defense to this action has been that patentsare invalid.

Simo Holdings Inc. v. uCloudlink25

Closing quotes: The kitchen sink

This is an issue you reach if you find infringement, because thequestion is not only do they infringe, but did they really know and notcare that they infringed? What’s the evidence of that?

Their defenses in this case don’t line up with the prelitigation evidence.

They have tried for years to wipe these patents out many times. Failed.Okay? And yet, it’s business as usual.

No witness for Fairchild took the stand and said “You know what? Weassessed these patents. We took these patents seriously. And webelieve we don’t infringe. Or we really believe these patents areinvalid.” Not a single Fairchild witness.

Power Integrations v. Fairchild26

The kitchen sink (continued)

Why not? Why not? In fact, they didn’t even bring a businessrepresentative to this trial. Their representative is a lawyer.Nothing wrong with lawyers, but they’re not the decision-makersin the company. They did not bring before you a person withauthority to decide or not decide whether to keep infringingthese patents to say “Hey, let me tell you, we looked at this. Wetook it seriously. And Here’s why we did what we did.” Youdidn’t hear it.

He had never seen either patent until the day before hisdeposition in the case, which was taken many years after thelawsuit was filed. Didn’t even – he hadn’t even seen the patents.

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What is the scope of waiver for trying to prove these issues?

1. Did you act consistent with the standards of commerce in your industry?2. Whether you intentionally copied the patented technology?3. Whether you made a good faith effort to avoid infringement upon

learning of the patent?4. Whether you reasonably believed (1) that you had a substantial

defense to infringement and (2) that the defense would be successful if litigated?

5. Did you rely on a legal opinion that was well-supported and reasonable?

Consider the waiver scope associated with a formal opinion


of the patent?4. Whether you reasonably believed (1) that you had a substantial defense to

infringement and (2) that the defense would be successful if litigated?5. Did you rely on a legal opinion that was well-supported and

reasonable?

Expansive production requirements when asserting advice of counsel

3-7. Advice of CounselNot later than 30 days after service by the Court of its Claim Construction Ruling, each party relying upon advice of counsel as part of a patent-related claim or defense for any reason shall:(a) Produce or make available for inspection and copying any written advice and documents related thereto for which the attorney-client and work product protection have been waived;

Expansive production requirements when asserting advice of counsel (continued)

3-7. Advice of CounselNot later than 30 days after service by the Court of its Claim Construction Ruling, each party relying upon advice of counsel as part of a patent-related claim or defense for any reason shall:(b) Provide a written summary of any oral advice and produce or make available for inspection and copying that summary and documents related thereto for which the attorney-client and work product protection have been waived; and

Expansive production requirements when asserting advice of counsel (continued)

3-7. Advice of CounselNot later than 30 days after service by the Court of its Claim Construction Ruling, each party relying upon advice of counsel as part of a patent-related claim or defense for any reason shall:(c) Serve a privilege log identifying any other documents, except those authored by counsel acting solely as trial counsel, relating to the subject matter of the advice which the party is withholding on the grounds of attorney-client privilege or work product protection.

Acting solely as trial counsel?

3-7. Advice of CounselNot later than 30 days after service by the Court of its Claim Construction Ruling, each party relying upon advice of counsel as part of a patent-related claim or defense for any reason shall:(c) Serve a privilege log identifying any other documents, except those authored by counsel acting solely as trial counsel, relating to the subject matter of the advice which the party is withholding on the grounds of attorney-client privilege or work product protection.

Consider what happens when you rely on litigation counsel for your “substantial defense”


of the patent?4. Whether you reasonably believed (1) that you had a substantial

defense to infringement and (2) that the defense would be successful if litigated?

5. Did you rely on a legal opinion that was well-supported and reasonable?

Consider what happens when you rely on “good faith effort”

1. Did you act consistent with the standards of commerce in your industry?2. Whether you intentionally copied the patented technology?3. Whether you made a good faith effort to avoid infringement upon

learning of the patent?4. Whether you reasonably believed (1) that you had a substantial defense to

infringement and (2) that the defense would be successful if litigated?5. Did you rely on a legal opinion that was well-supported and reasonable?

BAKER BOTTS

Three common tests for determining whether a communication is at issue

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Hearn v. Rhay In re County of Erie

Rhone-Poulenc Rorer Inc. v.

Home Indemnity

BAKER BOTTS

Hearn

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(1) assertion of the privilege was a result of some affirmative act by the asserting party;

(2) through this affirmative act, the asserting party put the protected information at issue by making it relevant to the case; and

(3) application of the privilege would have denied the opposing party access to information vital to the defense

BAKER BOTTS

In re County of Erie

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Hearn test

+A party must rely on privileged advice from

his counsel to make his claim or defense

BAKER BOTTS

Rhone-Poulenc Rorer

Inc.

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(1) assert a claim or defense, and

(2) attempt to establish that claim or defense by describing or disclosing an otherwise privileged attorney-client communication.

What would your privilege log look like?

When a party withholds information otherwise discoverable by claiming that the information is privileged or subject to protection as trial-preparation material, the party must:

(i) expressly make the claim; and

(ii) describe the nature of the documents, communications, or tangible things not produced or disclosed—and do so in a manner that, without revealing information itself privileged or protected, will enable other parties to assess the claim.

FRCP 26(b)(5)

Best practices for intentional waiver

Advanced planning is key Identify players and limit number of players Implement plan to manage documents

Document management can make or break scope issue Management of draft documents, conversations, and notes Have standard for identification of documents on same issue Enforce single-purpose communications Keep distribution lists tight Preserve materials that could be potentially at-issue after litigation is anticipated

Again—do NOT mix in-house, trial counsel, and opinion counsel communications

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EDUCATION/HONORS

Wayne Stacy

• J.D., George Washington University Law School, 1998

• B.S., Computer Engineering, Southern Methodist University, 1995

Partner, IP Litigation, Baker Botts LLP

• Adjunct professor teaching IP courses at 4 law schools, including UC Berkeley

• Over 20 years of high stakes and competitor-against-competitor patent litigation experience

• First chair trial attorney in district court and Patent Trial and Appeal Board (PTAB) cases

• Trial Instructor for the National Institute of Trial Advocacy

• National Law Journal “Trailblazer of the Year,” • "[A] strong trial lawyer" and "a renowned patent

litigator“ -- Chambers and Partners• Ranked by Chambers USA and Intellectual Asset

Manager (IAM)

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EDUCATION/HONORS

Deanna Kwong

• HPE IP Litigation team manages all IP-related litigation disputes for the company globally

• 2019 California Leaders in Tech Law and Innovation Award--Women Leaders in Tech

• J.D., UC Berkeley School of Law

Senior IP Litigation Counsel, Hewlett Packard Enterprise

EDUCATION/HONORS

Steven Carlson

• Adjunct lecturer at Berkeley Law, teaching patent litigation

• Former clerk to the Hon. Roderick McKelvie (D. Del.)• Former clerk to the Hon. Paul Michel (CAFC)• 20 years of litigation experience focused on patent

litigation, in high technology, biotech, and pharmaceuticals

• Co-Author: Patent Case Management Judicial Guide, 3rd Edition

• Co-Author: Patents in Germany and Europe: Procurement, Enforcement and Defense

• Conversant in French, Arabic, Berber

• J.D., Yale Law School• B.A. in Chemistry, Reed

College

Partner, IP Litigation, Robins Kaplan LLP

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