Apple Inc. v. Qualcomm IncorporatedMOTION to File Documents Under SealS.D. Cal.March 25, 2019 CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA IN RE: QUALCOMM LITIGATION, Case No. 3:17-CV-00108-GPC-MDD [Consolidated with Case No. 3:17-CV- 01010-GPC-MDD] APPLE, QUALCOMM, AND THE CONTRACT MANUFACTURERS’ JOINT MOTION TO FILE UNDER SEAL THE PARTIES’ LIST OF EXHIBITS AND SPECIFIC OBJECTIONS, PORTIONS OF THE PARTIES’ TRIAL BRIEFS, AND THE PARTIES’ OPERATIVE PLEADINGS Judge: Judge Gonzalo P. Curiel Courtroom: 2D Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112654 Page 1 of 14 -1- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiff and Counter-Defendant Apple Inc. (“Apple”), Defendant and Counter-Plaintiff Qualcomm, Inc. (“Qualcomm”), and Defendants, Counterclaimants, and Third-Party Plaintiffs Compal Electronics, Inc., FIH Mobile Ltd., Hon Hai Precision Industry Co., Ltd., Pegatron Corporation, and Wistron Corporation (collectively, the “CMs”), through the undersigned counsel, hereby move the Court for an order pursuant to Civil Local Rule 79.2 and Patent Local Rule 2.2 permitting the parties to file under seal unredacted versions of Attachments 1A-1B, 1G-1J, 2A-2B and 8 to the parties’ Final Joint Trial Notebook (“Trial Notebook Attachments”) and to file redacted or sealed versions of Trial Notebook Attachments 1A-1B, 1G-1J, 2A-2B, and 8 on the public docket. The sealing and redactions that the parties request are warranted to protect confidential, proprietary, and sensitive business information belonging to Apple, the CMs, Qualcomm, and third parties. I. Legal Standard Although there is a presumption in favor of public access to court records, the public’s right to access “is not absolute and can be overridden.” Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003). Two standards generally govern motions to seal documents, compelling reasons or good cause. The applicable standard depends on whether the records are “more than tangentially related to the merits of a case”. Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016). Where a record is more akin to discovery disclosures or is only tangentially related to the merits of the case, the Court generally applies “good cause”, pursuant to which a court may seal a record “to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense”. Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1096–97 (9th Cir. 2016) (quoting Fed. R. Civ. P. 26(c)). Where a record pertains to the merits of a case, courts apply a “compelling reasons” standard. Id. There are both compelling reasons and good cause to seal the identified information, and thus the parties’ joint Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112655 Page 2 of 14 THE PARTIES’ MOTION TO SEAL -2- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 motion to seal should be granted regardless of which standard applies. II. Discussion The parties seek to seal the Parties’ List of Exhibits and Specific Objections in this case (Trial Notebook Attachment 8), portions of each party’s trial briefs, (Trial Notebook Attachments 2A-2B), and the parties’ operative pleadings (Trial Notebook Attachments 1A-1B and 1G-1J). A. Exhibit Lists and Objection Lists Are Not Merits-Related Motions And Should Be Sealed For Good Cause. The parties are filing with the Court the Parties’ List of Exhibits and Specific Objections. Trial Notebook Attachment 8. This exhibit contains myriad references to documents designated as “HIGHLY CONFIDENTIAL – ATTORNEYS’ EYES ONLY” (“Highly Confidential”) by Qualcomm, Apple Inc. or the CMs under the Protective Order Governing Confidential Material (the “Protective Order”). (ECF No. 163.) The good cause standard applies to these lists because they are not more than tangentially related to case merits. See Ctr. for Auto Safety, 809 F.3d at 1096. The information in Trial Notebook Attachment 8 contains descriptions of roughly six thousand documents, many of which Apple, the CMs, Qualcomm, and third parties have designated as Confidential or Highly Confidential under the Protective Order. Zappala Decl. ¶ 5; Denning Decl. ¶ 5. The confidential information described in the exhibit list includes information regarding confidential contract negotiations; the existence, structure, and timing of confidential licensing and product agreements; the subject and timing of internal business planning and communications; and code names. Zappala Decl. ¶¶ 4; Denning Decl. ¶ 6; Rho Decl. ¶ 4. This information is kept confidential by Qualcomm, Apple, and the CMs, respectively. Zappala Decl. ¶ 8; Denning Decl. ¶ 6; Rho Decl. ¶ 8. With respect to third party documents, the parties are not permitted to disclose publicly the confidential information of third parties under Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112656 Page 3 of 14 THE PARTIES’ MOTION TO SEAL -3- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the protective order, without individual authorization from each third party. (ECF No. 163 § 7.1.) Public disclosure of this information, including the timing and type of agreements entered between various parties, could lead to competitive harm to the parties. Zappala Decl. ¶ 7; Denning Decl. ¶ 6; Rho Decl. ¶ 8. If this information were available publicly, the parties would likely suffer competitive harm in future negotiations, especially those involving patent licensing or product procurement, and disclosure of the parties’ confidential information would allow competitors and business partners to gain insight into the parties’ internal business operations, potentially compromising their competitive standing. Id. The parties respectfully request that the Court seal Trial Notebook Attachment 8 in its entirety. In order to file Trial Notebook Attachment 8 publicly, the parties would each have to review roughly six thousand entries to identify which entries involve their own confidential information. The parties would also have to individually review each of the roughly six thousand entries to determine which third parties’ confidential information is implicated by which entry, and for each such third party, contact and negotiate redaction or disclosure of the information, or provide the third parties the opportunity to move the Court for further relief. This onerous task would yield little consequent gain for the public—the mere description of six thousand documents which may be used at trial provides virtually no public benefit, and is closely analogous to information exchanged in discovery subject to the “good cause” standard. The Parties’ List of Exhibits and Specific Objections is a pretrial disclosure document, not a merits-related motion. In light of the substantial burden that redacting all confidential information from this exhibit would impose, and the minimal or non-existent public benefit from making this exhibit publicly available, the Court should find good cause exists to Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112657 Page 4 of 14 THE PARTIES’ MOTION TO SEAL -4- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 seal Trial Notebook Attachment 8 in its entirety.1 See Fed. R. Civ. P. 26(c)(1) (“The court may, for good cause, issue an order to protect a party or person from . . . undue burden or expense”). Courts routinely permit sealing of the types of information sought to be sealed in this motion, which reflect business strategy, negotiating steps, and competitively sensitive information such as various contractual agreements. Rainbow Bus. Sols. v. Merch. Servs., 2013 WL 12308205, at *2 (N.D. Cal. May 10, 2013) (finding compelling reasons to seal “particular information about the party’s contractual agreements . . . the public disclosure of which would impede its ability to negotiate with business partners and to stay competitive in the marketplace”). In addition, sealing is appropriate for documents that are “sources of business information that might harm a litigant’s competitive standing.” Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 598 (1978) (citations omitted). Courts also routinely enter protective orders permitting sealing under the “good cause” standard for discovery-related disclosures and disputes. See, e.g., Antoninetti v. Chipotle Mexican Grill, Inc., 2011 WL 8831149, at *1 (S.D. Cal. Mar. 17, 2011) (“It is appropriate to grant a protective order where commercially sensitive information is involved.”). B. Compelling Reasons Exist to Seal Portions of the Parties’ Pretrial Briefs. The parties also respectfully request that the Court seal portions of the parties’ trial briefs, Trial Notebook Attachments 2A-2B, and permit the parties to file public redacted versions on the public docket. The trial briefs contain references to information that has been designated as Highly Confidential under the Protective Order. (ECF No. 163.) These references include Apple, Qualcomm, and the CMs’ confidential business strategies; contract 1 This same reasoning supports a finding that compelling reasons to seal the information as well, in the event the Court determines that standard applies. Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112658 Page 5 of 14 THE PARTIES’ MOTION TO SEAL -5- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 negotiations; the existence, structure, and timing of confidential licensing and product agreements; contractual incentives; the subject and timing of internal business planning and communications; patent licensing practices; internal market intelligence; and nonpublic financial information. Zappala Decl. ¶ 6; Denning Decl. ¶ 7; Rho Decl. ¶ 6. Public disclosure of this information would likely cause competitive harm to Apple, Qualcomm, and/or the CMs, respectively. The parties affirm that they have taken diligent efforts to maintain the confidentiality of the materials to be sealed. The confidential information in the trial briefs and the documents from which that information is derived are not publicly available, and the parties take extensive measures to ensure that the contents of these documents remain confidential. Zappala Decl. ¶¶ 7-8; Denning Decl. ¶ 8; Rho Decl. ¶ 9. There are compelling reasons to seal documents containing confidential business strategies and information and communications containing financial terms, incentives, and negotiations over contract terms where such information could cause competitive harm if disclosed publicly. See In re Elec. Arts, Inc., 298 F. App’x 568, 569 (9th Cir. 2008) (finding compelling reasons existed for sealing “the pricing terms, royalty rates, and guaranteed minimum payment terms” of a license agreement); In re Qualcomm Litig., No. 3:17-CV-0108-GPC-MDD, 2017 WL 5176922, at *2 (S.D. Cal. Nov. 8, 2017) (“[T]he Court is satisfied that compelling reasons exist to seal the unredacted portions of the pleadings and briefing that concern licensing terms, royalties paid or owed under license agreements, financial terms, details of confidential licensing negotiations, and business strategies.”); Velasco v. Chrysler Grp. LLC, 2017 WL 445241, at *2 (C.D. Cal. Jan. 26, 2017) (noting courts in the Ninth Circuit have found compelling reasons to seal records containing “information about proprietary business operations, a company’s business model or agreements with clients” and “internal policies and strategies” (internal citations omitted)); Cohen v. Trump, Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112659 Page 6 of 14 THE PARTIES’ MOTION TO SEAL -6- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2016 WL 3036302, at *5 (S.D. Cal. May 27, 2016) (“Where . . . the material sought to be sealed contained confidential business material, such as marketing strategies, product development plans, licensing agreements, and profit, cost, and margin data, courts have been willing to find that information confidential.”). Thus, the Court should grant this motion under the compelling reasons standard and permit the parties to file the redacted versions of their respective trial briefs, Trial Notebook Attachments 2A-2B, on the public docket. C. The Court Previously Granted the Parties’ Requested Redactions of the Operative Pleadings. The Court has previously granted the parties’ requested redactions of the operative pleadings in this case. Trial Notebook Attachments 1A-1B and 1G-1J. The parties’ requested redactions here are identical to the redactions the Court has already granted. Therefore, the parties submit that there is good cause to seal unredacted versions of the operative pleadings and to allow the parties to file redacted versions of the operative pleadings on the public docket. The chart describes the attachments that the parties request to file under seal: Attachment Description of Attachment Confidentiality Interests 1A Apple’s First Amended Complaint against Qualcomm, filed on June 20, 2017. (No. 3:17- cv-0108-GPC-MDD, ECF No. 83.) Identical redactions previously granted by the Court. ECF No. 132. 1B Apple’s Answer and Affirmative Defenses to Qualcomm’s Counterclaims, filed on June 20, 2017. (No. 3:17-cv-0108-GPC-MDD, ECF No. 84.) Identical redactions previously granted by the Court. ECF No. 132. 1G Qualcomm’s Answer to Apple’s First Amended Complaint and Qualcomm’s Second Amended Counterclaims, filed on May 2, 2018. (No. 3:17-cv- 00108-GPC-MDD, ECF Identical redactions previously granted by the Court. ECF No. 488. Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112660 Page 7 of 14 THE PARTIES’ MOTION TO SEAL -7- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Attachment Description of Attachment Confidentiality Interests No. 469.) 1H Qualcomm’s Complaint against the CMs, filed on May 17, 2017. (No. 3:17- cv-01010-GPC-MDD, ECF No. 1.) Identical redactions previously granted by the Court. ECF No. 132. 1I Qualcomm’s Answer and Defenses to the CMs’ Counterclaims and Defenses, filed on August 8, 2017. (No. 3:17-cv-01010- GPC-MDD, ECF No. 117.) Identical redactions previously granted by the Court. ECF No. 145. 1J The CMs’ Answer, Defenses and Counterclaims to Qualcomm’s Complaint, filed on July 18, 2017. (No. 3:17-cv-01010-GPC-MDD, ECF No. 84.) Identical redactions previously granted by the Court. ECF No. 132. 2A Contains references to information that has been designated as Highly Confidential under the Protective Order. 2B Contains references to information that has been designated as Highly Confidential under the Protective Order. 8 The Parties’ List of Exhibits and Specific Objections Describes documents that Apple, the CMs, Qualcomm, and third parties have designated as Confidential or Highly Confidential under the Protective Order. The confidential information described in the exhibit list includes information regarding confidential contract negotiations; the existence, structure, and timing of confidential licensing and product agreements; the subject and timing of internal business planning and communications; and code names Apple and the CMs' Trial Brief. Qualcomm's Trial Brief. Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112661 Page 8 of 14 THE PARTIES’ MOTION TO SEAL -8- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 III. Conclusion Accordingly, there is good cause and compelling reasons, as applicable, for sealing the Parties’ List of Exhibits and Specific Objections, Attachment 8, to seal portions of the parties’ trial briefs, Attachments 2A-2B, to seal portions of the parties’ operative pleadings, Attachments 1A-1B and 1G-1J, and permit the parties to file redacted versions of the trial briefs and operative pleadings on the public docket. The parties therefore respectfully request that the Court grant their Motion to File Under Seal. Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112662 Page 9 of 14 THE PARTIES’ MOTION TO SEAL -9- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated: March 24, 2019 Respectfully submitted, By: /s/ Evan R. Chesler Evan R. Chesler, N.Y. Bar No. 1475722, pro hac vice, echesler@cravath.com Keith R. Hummel, N.Y. Bar No. 2430668, pro hac vice, khummel@cravath.com Richard J. Stark, N.Y. Bar No. 2472603, pro hac vice, rstark@cravath.com Antony L. Ryan, N.Y. Bar No. 2784817, pro hac vice, aryan@cravath.com Gary A. Bornstein, N.Y. Bar No. 2916815, pro hac vice, gbornstein@cravath.com J. Wesley Earnhardt, N.Y. Bar No. 4331609, pro hac vice, wearnhardt@cravath.com Yonatan Even, N.Y. Bar No. 4339651, pro hac vice, yeven@cravath.com Vanessa A. Lavely, N.Y. Bar No. 4867412, pro hac vice, vlavely@cravath.com CRAVATH, SWAINE & MOORE LLP Worldwide Plaza, 825 Eighth Avenue New York, NY 10019 Telephone: (212) 474-1000 Facsimile: (212) 474-3700 David A. Nelson, Ill. Bar No. 6209623, pro hac vice, davenelson@quinnemanuel.com Stephen Swedlow, Ill. Bar No. 6234550, pro hac vice, stephenswedlow@quinnemanuel.com QUINN EMANUEL URQUHART & SULLIVAN, LLP 500 West Madison St., Suite 2450 Chicago, Illinois 60661 Telephone: (312) 705-7400 Facsimile: (312) 705-7401 Alexander Rudis, N.Y. Bar No. 4232591, pro hac vice, alexanderrudis@quinnemanuel.com QUINN EMANUEL URQUHART & SULLIVAN, LLP 51 Madison Ave., 22nd Floor New York, New York 10010 Telephone: (212) 849-7000 Facsimile: (212) 849-7100 Sean S. Pak, SBN 219032, Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112663 Page 10 of 14 THE PARTIES’ MOTION TO SEAL -10- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 seanpak@quinnemanuel.com QUINN EMANUEL URQUHART & SULLIVAN, LLP 50 California St., 22nd Floor San Francisco, CA 94111 Telephone: (415) 875-6600 Facsimile: (415) 875-6700 Karen P. Hewitt, SBN 145309), kphewitt@jonesday.com 4655 Executive Drive, Suite 1500 JONES DAY San Diego, California 92121 Telephone: (858) 314-1200 Facsimile: (858) 345-3178 Attorneys for Defendant and Counterclaim- Plaintiff Qualcomm Incorporated By: /s/ William A. Isaacson Juanita R. Brooks, SBN 75934, brooks@fr.com Seth M. Sproul, SBN 217711, sproul@fr.com FISH & RICHARDSON P.C. 12390 El Camino Real San Diego, CA 92130 Phone: 858-678-5070 / Fax: 858-678-5099 Ruffin B. Cordell, DC Bar No. 445801, pro hac vice, cordell@fr.com Lauren A. Degnan, DC Bar No. 45421, pro hac vice, degnan@fr.com FISH & RICHARDSON P.C. 1000 Maine Avenue, S.W., Suite 1000 Washington, DC 20024 Phone: 202-783-5070 / Fax: 202-783-2331 William A. Isaacson, DC Bar No. 414788, pro hac vice, wisaacson@bsfllp.com Karen L. Dunn, DC Bar No. 1002520, pro hac vice, kdunn@bsfllp.com BOIES SCHILLER FLEXNER LLP 1401 New York Avenue, N.W. Washington, DC 20005 Phone: 202-237-2727 / Fax: 202-237-6131 Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112664 Page 11 of 14 THE PARTIES’ MOTION TO SEAL -11- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Attorneys for Plaintiff and Counterclaim Defendant Apple Inc. By: /s/ Jennifer J. Rho Theodore R. Boutrous, Jr., SBN 132099, tboutrous@gibsondunn.com Richard J. Doren, SBN 124666 rdoren@gibsondunn.com Daniel G. Swanson, SBN 116556, dswanson@gibsondunn.com Michele L. Maryott, SBN 191993 mmaryott@gibsondunn.com Jason C. Lo, SBN 219030, jlo@gibsondunn.com Jennifer J. Rho, SBN 254312, jrho@gibsondunn.com Melissa Phan, SBN 266880, mphan@gibsondunn.com GIBSON, DUNN & CRUTCHER LLP 333 South Grand Avenue Los Angeles, CA 90071 Tel: (213) 229-7000; Fax: (213) 229-7520 Cynthia Richman, DC Bar No. 492089, pro hac vice crichman@gibsondunn.com GIBSON, DUNN & CRUTCHER LLP 1050 Connecticut Avenue, N.W. Washington, DC 20036 Tel: (202) 955-8500; Fax: (202) 467-0539 Attorneys for Defendants, Counterclaimants, and Third-Party Plaintiffs Compal Electronics, Inc., FIH Mobile Ltd., Hon Hai Precision Industry Co., Ltd., Pegatron Corporation, and Wistron Corporation Hugh F. Bassanger, pro hac vice hugh.bangasser@klgates.com Christopher M. Wyant, pro hac vice chris.wyant@klgates.com J. Timothy Hobbs, pro hac vice tim.hobbs@klgates.com K&L GATES LLP 925 Fourth Avenue, Suite 2900 Seattle, Washington 98104 Tel: (206) 623-7580; Fax: (206) 370-6371 Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112665 Page 12 of 14 THE PARTIES’ MOTION TO SEAL -12- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Caitlin C. Blanche, SBN 254109, caitlin.blanche@klgates.com K&L GATES LLP 1 Park Plaza Twelfth Floor Irvine, CA 92614 Tel: (949) 253-0900; Fax: (949) 253-0902 Attorneys for Defendant, Counterclaimant, and Third-Party Plaintiff Wistron Corporation Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112666 Page 13 of 14 THE PARTIES’ MOTION TO SEAL -13- CASE NO. 17-CV-00108-GPC-MDD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CERTIFICATE OF SERVICE The undersigned hereby certifies that a true and correct copy of the above and foregoing document has been served on March 24, 2019, to all counsel of record who are deemed to have consented to electronic service via the Court’s CM/ECF system per Civ. L.R. 5.4(d). Any other counsel of record will be served by electronic mail, facsimile and/or overnight delivery. Executed on March 24, 2019. /s/ Evan R. Chesler Evan R. Chesler Case 3:17-cv-00108-GPC-MDD Document 1052 Filed 03/25/19 PageID.112667 Page 14 of 14