Quinn Emanuel Battles Samsung Sanctions on Eve of Retrial

, The Litigation Daily

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Julia Love writes for The Recorder, an American Lawyer affiliate.

SAN FRANCISCO — As their second showdown before a jury nears, Apple appears poised to win sanctions against Samsung for leaking its secrets.

In an order filed Friday evening, U.S. Magistrate Judge Paul Grewal asked Samsung and its lawyers at Quinn Emanuel Urquhart & Sullivan to explain why they should not be sanctioned for violating a protective order meant to guard confidential information turned over in discovery. Scores of Samsung employees apparently gained access to Apple secrets—including details of a licensing agreement with Nokia—after lawyers at Quinn Emanuel failed to redact sensitive information from an expert report, according to court papers.

As the parties probed the breaches, Samsung insisted that its own confidential information must be handled with care, citing attorney-client privilege and work-product protections. Grewal conducted an extensive in camera review of Samsung documents before ruling.

"Having finally crawled out from under the boxes, it appears to the undersigned that if anything was breached, it is the court's protective order, and that sanctions against Samsung and its attorneys are warranted," Grewal wrote.

He pointed to evidence indicating that Samsung wielded Apple's secrets in negotiations with Nokia and Ericsson. And after improperly redacting the documents, Quinn Emanuel failed to follow the steps set forth in the protective order, though it had ample notice of the violations, Grewal noted. Grewal invited lawyers for Apple and Nokia to weigh in on the appropriate penalties.

The allegations against Samsung have made for a captivating sideshow as the rivals head to trial once more to figure out how much Samsung must pay Apple for infringing several of its patents. The debacle even rose to the attention of Quinn Emanuel founder John Quinn, who apologized to Grewal for the breaches at a hearing last month but insisted that sanctions were not called for. He said the firm failed to protect just a few pieces of information in a lengthy report that was otherwise properly redacted.

Grewal wrote in the order that Samsung may conduct limited discovery to determine how closely Apple and its business partners guarded their information. But he set new ground rules, permitting lawyers for Apple, Nokia and Ericsson to attend the depositions. Lawyers for Apple and Nokia complained to Grewal at last month's hearing that Samsung and Quinn had blocked them from gauging the full extent of the breaches.

"The court will not tolerate further efforts to deny outside counsel access to discovery not truly subject to privilege or work product protections," Grewal wrote.

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