LG Electronics Inc. v. Q-lity Computer Inc.

211 F.R.D. 360, 2002 U.S. Dist. LEXIS 23932, 2002 WL 31739976
CourtDistrict Court, N.D. California
DecidedDecember 4, 2002
DocketNos. C-01-0326 CW (EDL), C-01-1375 CW (EDL), C-01-1552 CW (EDL), C-01-1594 CW (EDL), C-01-2187 CW (EDL)
StatusPublished
Cited by13 cases

This text of 211 F.R.D. 360 (LG Electronics Inc. v. Q-lity Computer Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
LG Electronics Inc. v. Q-lity Computer Inc., 211 F.R.D. 360, 2002 U.S. Dist. LEXIS 23932, 2002 WL 31739976 (N.D. Cal. 2002).

Opinion

ORDER

LAPORTE, United States Magistrate Judge.

In these related patent actions brought by LG Electronics Inc. (“LGE”) against various defendants, numerous motions have been referred to this Court for resolution. First, Apple Computer Inc. (“Apple”) moves to intervene for the limited purpose of opposing LGE’s motion to amend its infringement contentions to include Apple products. For the reasons set forth below, this motion is granted.

Second, LGE moves to amend its Patent Local Rule 3-6(a) disclosures. For the reasons set forth below, this motion is granted in part, and denied in part.

Third, LGE moves to compel discovery on various topics. In opposition to part of LGE’s motion to compel, Apple moves for a protective order against the disclosure of confidential information by Q-Lity Computer, Inc., Quanta Computer, Inc., and Quanta Computer USA, Inc. (collectively, “Quanta”) and moves to quash LGE’s subpoena duces tecum against Apple. Apple has also filed a motion for a protective order and motion to quash LGE’s deposition subpoena against Apple. For the reasons set forth below, LGE’s motion to compel discovery with respect to Apple products is denied, and Apple’s motions for protective order and to quash are granted. LGE’s motion to compel discovery on the remaining topics is taken under submission until after Judge Wilken rules on the pending motions for summary judgment filed by First International Computer, Inc. and First International Computer of America, Inc. (jointly, “FIC”) and Compal Electronics, Inc., Bizcom Electronics, Inc., and Sceptre Technologies, Inc. (collectively, “Compal”).

I. BACKGROUND

LGE asserts six patents against the defendants in these cases: United States Patent Nos. 4,918,645 (the ’645 patent), 4,939,641 (the ’641 patent), 4,926,419 (the ’419 patent), 5,077,733 (the ’733 patent), and 5,379,379 (the ’379 patent). On October 26, 2001, LGE served its Patent Local Rule 3-1 initial disclosures, which identified the allegedly infringing products of the defendants that LGE had been able to identify by that time. (Morris Decl. in Support of Motion to Amend 112.) On December 28, 2001, LGE served supplemental Patent Local Rule 3-1 disclosures, in which it identified additional allegedly infringing products. (Id.)

Defendants Asustek Computer, Inc. and Asus Computer International, Inc. (jointly, “Asustek”) and Quanta moved for summary judgment that a cross license agreement between LGE and Intel precluded LGE from seeking damages for infringement with respect to five of the six patents at issue. Defendant Everex Systems, Inc. (“Everex”) joined in the motions for summary judgment filed by Asustek and Quanta. LGE opposed the motions and filed a cross-motion for summary judgment that the LGE-Intel Cross License Agreement (“LGE-Intel Cross License”) did not exhaust LGE’s rights in the five patents and did not create an implied license between LGE and Intel’s downstream customers. On August 20, 2002, the Honorable Claudia Wilken granted defendants’ motions for summary judgment, and denied LGE’s cross-motion.

According to Judge Wilken’s summary judgment order:

On September 7, 2000, LGE entered into the LGE-Intel License. Pursuant to this agreement, Intel paid to LGE a certain [363]*363sum of money and agreed to provide an additional amount in discounts in future purchases. The LGE-Intel License gives Intel the right to manufacture products that would otherwise infringe any of the patents owned by LGE, including the patents at issue here. The LGE-Intel License expressly disclaims any implied license to Intel customers who combine products covered by the LGE-Intel License with non-Intel products. Several days prior to entering into the LGE-Intel License, Intel sent a letter to all its customers, including Defendants, informing them that its license with LGE “does not extend, expressly or by implication to any product that you may make by combining an Intel product with any non-Intel product.”
Intel produces microprocessors and chip-sets that are covered by the LGE-Intel License. Defendants purchase these microprocessors and chipsets from Intel or its authorized distributors and install the licensed Intel microprocessors and chipsets into computers that they manufacture [footnote omitted], LGE contends that many of these computers infringe its patents. A number of microprocessors and chipsets disclosed in LGE’s infringement contentions are manufactured by Intel. LGE does not contend that the Intel microprocessors and chipsets, alone, infringe any of the patents at issue here. Rather, LGE’s claim charts reveal that the licensed Intel products meet many of the limitations of the patents, and when combined with other components in the accused devices, infringe five of its patents.

(Summary Judgment Order at 4-5.)

Applying the doctrine of patent exhaustion, Judge Wilken granted defendants’ motion for summary judgment, agreeing with their argument that “because LGE licensed to Intel the right to practice LGE’s patents and sell products embodying its patents — and Intel’s production and sale of its microprocessors and chipsets are covered by this agreement — LGE forfeited its potential infringement claims against those who legitimately purchase and use the Intel microprocessor and chipset.” (Id. at 9.) “Consequently, the LGE-Intel License not only exhausted LGE’s rights in the Licensed Products, but also exhausted LGE’s right to claim infringement against any device that uses the licensed microprocessor and chipset for its intended use in the manner recommended by Intel.” (Id. at 10.) The Court also noted, however, that “[t]o the extent that the allegedly infringing products do not use Intel microprocessors and chipsets that are covered by the LGE-Intel License, the patent exhaustion doctrine is not applicable.” (Id. at 16 n. 4.)

FIC and Compal have also filed motions for partial summary judgment before Judge Wilken, and LGE has filed a cross-motion for summary judgment, all of which are still pending. On November 20, Judge Wilken issued an order requesting further briefing on those motions, and indicated that she is treating LGE’s cross-motion for summary judgment as a motion for reconsideration of her August 20 summary judgment opinion.

Judge Wilken also issued a claim construction order on August 20. On September 19, 2002, a month after Judge Wilken’s summary judgment and claim construction orders, LGE served its Final Infringement Contentions, pursuant to Patent Local Rule 3-6(a), for the ’645, ’641, ’733, ’379, and ’509 patents. (Morris Decl. in Support of Motion to Amend, Ex. 10.) LGE has identified the products of the defendants that it believes infringe each patent. (Id.) In Table 1 of the contentions for each patent, LGE identifies the products that it previously has notified the defendants as allegedly infringing. (Id.) In Table 2 of the contentions for each patent, LGE identifies for the first time additional products that it believes infringe its patents. (Id.) LGE now seeks permission after the fact to amend its Patent Local Rule 3-6(a) contentions to include its infringement allegations against these newly identified products.

II. DISCUSSION

A. Apple.’s Motion for Leave to Intervene for the Limited Purpose of Opposing LG Electronics, Inc.’s Motion to Amend its Infringement Contentions to Include Apple Products

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211 F.R.D. 360, 2002 U.S. Dist. LEXIS 23932, 2002 WL 31739976, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lg-electronics-inc-v-q-lity-computer-inc-cand-2002.