Qualcomm Inc. v. Broadcom Corp.

539 F. Supp. 2d 1214, 88 U.S.P.Q. 2d (BNA) 1141, 2007 U.S. Dist. LEXIS 57136, 2007 WL 2296441
CourtDistrict Court, S.D. California
DecidedAugust 6, 2007
Docket3:05-cr-01958
StatusPublished
Cited by3 cases

This text of 539 F. Supp. 2d 1214 (Qualcomm Inc. v. Broadcom Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Qualcomm Inc. v. Broadcom Corp., 539 F. Supp. 2d 1214, 88 U.S.P.Q. 2d (BNA) 1141, 2007 U.S. Dist. LEXIS 57136, 2007 WL 2296441 (S.D. Cal. 2007).

Opinion

ORDER ON REMEDY FOR FINDING OF WAIVER

RUDI M. BREWSTER, Senior District Judge.

I. INTRODUCTION

On March 21, 2007, this Court entered an Order (1) finding in favor of Defendant Broadcom Corporation (“Broadcom”) and against Plaintiff Qualcomm Incorporated (“Qualcomm”) on Broadcom’s Third Affirmative Defense that U.S. Patent Nos. 5,452,104 (Pl’s Trial Ex. 1) (“the '104 patent”) and 5,576,767 (Pi’s Trial Ex. 3) (“the '767 patent”) are unenforceable due to waiver; and (2) setting hearing on an Order to Show Cause as to what the appropriate remedy for Qualcomm’s waiver should be. (Doc. No. 528 at 2.)

Following hearing on the Order to Show Cause and careful consideration of relevant court and deposition transcripts, declarations, and other documents submitted by both parties, the Court hereby issues the following remedy for Qualcomm’s waiver: that the '104 and '767 patents, their continuations, continuations-in-part, divi *1216 sions, reissues, or any other dependent or derivative patents of either patent, shall be and are hereby ordered unenforceable.

II. BACKGROUND

Qualcomm filed the present suit against Broadcom for patent infringement of the '104 and '767 patents on October 14, 2005, based on Broadcom’s manufacture, sale, and offers to sell H.264-compliant products. (Doc. No. 1.) Broadcom filed its First Amended Answer and Counterclaims on December 8, 2006, in which it alleged (1) a counterclaim that the '104 patent is unenforceable due to inequitable conduct; and (2) a Third Affirmative Defense that the '104 and '767 patents are unenforceable due to waiver. (Doc. No. 370.)

A jury trial was held on the legal issues from January 9, 2007, to January 26, 2007. The jury unanimously returned a verdict (1) in favor of Broadcom and against Qualcomm of non-infringement of the '104 and '767 patents; and (2) in favor of Qualcomm and against Broadcom for non-obviousness of the '104 and '767 patents. (Doc. No. 499.) The jury also unanimously returned an advisory verdict on the equitable issues: (1) finding by clear and convincing evidence in favor of Broadcom and against Qualcomm that the '104 patent is unenforceable due to inequitable conduct; and (2) finding by clear and convincing evidence in favor of Broadcom and against Qualcomm that the '104 and '767 patents are unenforceable due to waiver. (Id. at 14.)

The Court held an evidentiary hearing on the equitable issues of inequitable conduct and waiver on February 9, 2007. On March 21, 2007, the Court entered an Order: (1) finding in favor of Qualcomm and against Broadcom on Broadcom’s counterclaim of inequitable conduct as to the '104 patent; (2) finding in favor of Broadcom and against Qualcomm on Broadcom’s affirmative defense that the '104 and '767 patents are unenforceable due to waiver based on Qualcomm’s conduct before the Joint Video Team (“JVT”), the standards-setting body that created the H.264 standard; and (3) setting hearing on an Order to Show Cause as to what the appropriate remedy for Qualcomm’s waiver should be. (Doc. No. 528 at 2.) The Court conducted a hearing on its Order to Show Cause on June 25, 2007.

After the verdict was entered, Broadcom again demanded discovery of Qualcomm’s records that previously had been concealed, but whose possible existence was only revealed during Broadcom’s cross-examination of Qualcomm witness Viji Raveendran on one of the last days of trial. Thereafter, after over three more months of denials, refusals, and opposition, Qualcomm reversed its position, allegedly to avoid further dispute over the matter, and produced on April 13, 2007, over 110,000 pages of emails, company correspondence, and memoranda, and on May 15, 2007, over 120,000 more pages, some of which have now been filed with the Court, none of which have been disputed by Qualcomm.

III. DISCUSSION

A. STANDARD OF LAW

As the Court found in its March 21 Order, Broadcom has the burden of proving its affirmative defense of waiver and remedy therefor by clear and convincing evidence. (Doc. No. 528 at 13.)

A district court may in its discretion hold a patent unenforceable in considering an affirmative defense of inequitable conduct by inventors and/or their agents before the United States Patent and Trademark Office (“PTO”), but the remedy depends on equitable considerations arising from the circumstances involved. See Refac Int’l, Ltd. v. Lotus Dev. Corp., 81 F.3d 1576, 1581, 1585 (affirming a finding of unenforceability based on an inequitable *1217 conduct affirmative defense and holding that a “district court must ... weigh the threshold findings of materiality and intent in fight of all the circumstances to determine whether they warrant a conclusion” of inequitable conduct).

As the Court stated in its Order finding waiver, “[i]n that context, the Court here considers with respect to waiver the extent of the materiality of the omitted information and the circumstances surrounding [Qualcomm’s] omissions in connection with the proceedings in the JVT.” (Doc. No. 528 at 33.) While the Court is still unable to find, nor have the parties presented, case guidance for an equitable remedy to a finding of waiver by a patentee or assignee as an affirmative defense, it appears to the Court, as it stated in its Order, that “the remedy should not be automatic, but should be fashioned to give a fair, just, and equitable response reflective of [Qual-comm’s] offending conduct.” (Id.)

The Court has not found a patent decision assessing the remedy for a finding of waiver based upon conduct of silence in the face of a duty to speak. The Rambus case, in which the Federal Circuit established the obligation to speak, did not involve a remedy for a breach of that obligation, because the party which allegedly violated the rule had not possessed intellectual property rights that read on or directly applied to the activities of the standards development process. See Rambus Inc. v. Infineon Techs. AG, 318 F.3d 1081, 1102-05 (Fed.Cir.2003). Therefore, this Court, by analogy to the available remedies for redressing inequitable conduct before the United States Patent and Trademark Office (“PTO”), holds that the remedy available here may vary from no remedy to declaring the involved patents totally unenforceable.

Qualcomm argues that Broadcom may not have any remedies beyond itself, because it raised the waiver issue only by a separate affirmative defense and not by a counterclaim or cross-claim. This contention is without merit. The Federal Circuit has upheld the unenforceability of a patent to the world due to inequitable conduct before the PTO even when pled as an affirmative defense by the defendant. See McKesson Info. Solutions, Inc. v. Bridge Med., Inc., 487 F.3d 897, 908, 926 (Fed.Cir.2007); Semiconductor Energy Lab. Co., Ltd. v. Samsung Elecs. Co., Ltd.,

Related

Qualcomm Incorporated v. Broadcom Corp.
548 F.3d 1004 (Federal Circuit, 2008)
Broadcom Corp. v. Qualcomm Inc.
501 F.3d 297 (Third Circuit, 2007)

Cite This Page — Counsel Stack

Bluebook (online)
539 F. Supp. 2d 1214, 88 U.S.P.Q. 2d (BNA) 1141, 2007 U.S. Dist. LEXIS 57136, 2007 WL 2296441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/qualcomm-inc-v-broadcom-corp-casd-2007.