Quinn Fights Back Against Leak Accusations in Apple Case
SAN JOSE — Quinn Emanuel is in such a tight spot over its apparent mishandling of confidential documents that the firm's founder, John Quinn, came to its defense at a hearing on Tuesday.
As Apple and Samsung prepare to take their long-running patent spat to a jury once more, Apple accuses lawyers at Quinn Emanuel Urquhart & Sullivan of sharing confidential terms of its licensing agreements with Samsung and is seeking sanctions for the breach. Apple contends Samsung then used the information to gain an upper hand in negotiations with other companies and in disputes before other courts.
Quinn apologized to U.S. Magistrate Judge Paul Grewal of the Northern District of California for the disclosures, acknowledging that the firm's reputation is at stake. But he insisted that sanctions are not called for because the firm did not intentionally leak Apple's secrets, and there is no evidence that Samsung made improper use of the information. He chided Apple for seeking to exploit the firm's error.
"For them, it's a free shot," he said. "They can keep us occupied, run up the expenses and at some point ask your honor, 'Make them pay our fees.'"
Quinn noted that his firm has failed to redact just a few lines of confidential information in a sprawling expert report.
But Apple lawyer William Lee of Wilmer Cutler Pickering Hale and Dorr insisted that those missteps constituted a "massive unauthorized disclosure of highly confidential information." He urged Grewal to preserve the integrity of protective orders.
"We are getting phone calls and emails from our other license partners that say, 'Did you produce our information during discovery? What has Samsung done with it?'" Lee said. "We don't have an answer."
Grewal said he is not yet convinced that sanctions are warranted but would like more information. He ordered Samsung to produce documents related to the communications for in camera review.
In early October, Grewal ordered the company's lawyers to turn over communications related to the breach and make a Samsung executive available for deposition. But Lee argued that Samsung's response fell far short as much of the documents were heavily redacted. Lee argued that because the documents at issue concern violations of a protective order, the crime-fraud exception bars Quinn Emanuel from using attorney-client privilege to shield them.
"It's also remarkable that the answer to all of this is, 'We're not going to give you the documents,'" Lee said.
Lee said Apple's confidential information has now been shared with more than 220 people, including more than 90 Samsung employees who were not authorized to receive the materials. Quinn Emanuel has been on notice about the violations since at least December 2012, he argued, when an associate mistakenly sent the expert report to a Samsung official, Lee said. But the firm did not take action for months.
But Quinn argued that law firms are prone to such errors, particularly when dealing with thousands of confidential documents. He questioned whether the associate's misstep late last year should have prompted the firm to "blow the whistle."
"Should we have gone through the provisions of the protective order?" Quinn asked. "I think reasonable people could differ."
Terms of a 2011 licensing agreement between Apple and Nokia were revealed as a result of the breach. Samsung executive Seungho Ahn allegedly recited the terms of the agreement to better his position in licensing negotiations with Nokia, the company contends.
Ahn stated in a sworn declaration that he did not recall seeing any confidential Apple documents and must have learned about the company's licensing agreements from the news and other public sources of information. Quinn noted that none of the participants in the meeting were native English speakers.
"I prefer to think there's a miscommunication here rather than somebody's lying," Quinn said.
But Lee decried Ahn's explanation as implausible. He insisted that Samsung executives bring Apple's secrets to the table in negotiations to resolve the companies' global intellectual property disputes.
"That information is in the head of every single Samsung licensing executive now," he said. "We need to come up with a remedy that will address that."