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LG Electronics, Inc. v. Motorola

August 5, 2010

LG ELECTRONICS, INC. AND LG ELECTRONICS USA, INC., PLAINTIFFS,
v.
MOTOROLA, INC., DEFENDANT.



The opinion of the court was delivered by: Young B. Kim U.S. Magistrate Judge

Magistrate Judge Young B. Kim

MEMORANDUM OPINION and ORDER

Before the court is the motion of LG Electronics, Inc. and LG Electronics USA, Inc. (collectively "LG" or the "LG Defendants") to compel nonparty Motorola, Inc. ("Motorola") to produce documents and a witness for deposition. For the following reasons, LG's motion is granted in part and denied in part:

Background and Procedural History

The LG Defendants are parties in an underlying patent infringement case captioned Vizio, Inc. v. LG Electronics, Inc.,Case No. 1:09-cv-1481, pending in the United States District Court for the District of Maryland. Motorola is a third-party to the dispute between Vizio, Inc. ("Vizio") and LG. In the underlying lawsuit, Vizio alleges that LG infringed seven patents (the "Vizio patents" or the "patents") that Vizio purchased from Motorola in April 2009. Motorola acquired the patents through the purchase of General Instrument Corporation ("GI") in January 2000.

On January 12, 2010, LG served Motorola with a subpoena issued by the United States District Court for the Northern District of Illinois requesting the production of documents for 47 categories pertaining to the patents at issue in the underlying case.*fn1 (LG's Ex. 1.) Fourteen days later, on January 28, 2010, Motorola served comprehensive objections to LG's subpoena. (LG's Ex. 7.) LG and Motorola then met and conferred by telephone and via written correspondence approximately 30 times to resolve their disputes related to the subpoena.

Motorola contends that in its initial telephone conversation, LG narrowed the scope of the subpoena and identified four categories of documents for which it sought production. (Motorola's Resp. at 2.) These four categories of documents included: (1) the prosecution files for the Vizio patents as well as any reduction to practice; (2) GI's communications and involvement with two television standards setting organizations, including ANSI*fn2 /SCTE*fn3 07 (formerly SCTE DVS031) titled "Digital Video Transmission Standard for Cable Television" ("SCTE 07") and the ITU-T*fn4 Recommendation J.83 Annex B, titled "Series J: Transmission of Television Sound Programme and Other Multimedia Signals" ("ITU-T J.83"); (3) communications between Motorola and Vizio regarding the purchase of the Vizio patents and any due diligence; and (4) licenses referenced in the Motorola-Vizio Patent Purchase Agreement ("purchase agreement") pertaining to the Vizio patents. (Id.)

Motorola claims that it provided LG with all non-privileged documents responsive to these four categories, and a privilege log for those documents withheld. (Motorola's Resp. at 2.) But despite Motorola's understanding that it had complied with the narrowed scope of the subpoena, Motorola asserts that LG subsequently demanded additional categories of documents. (Id. at 3.) As a result, Motorola engaged in extensive telephone, e-mail and written communications with LG, and ultimately produced an additional 500 or so pages of non-privileged documents. (Id.) Motorola asserts that its ability to respond to the subpoena is limited by the fact that: (1) Motorola transferred its patent files to Vizio and did not retain a copy of those files; (2) the events at issue took place 15 years ago which was well before Motorola acquired GI; (3) the underlying lawsuit is centered around the development of two industry standards which were drafted and promulgated in the mid-1990's; and (4) LG either already has the documents in its possession or they are available directly from Vizio. (Id.) Motorola also objects to producing those documents that are available from Vizio, but that the parties themselves had chosen not to pursue as part of the discovery plan in the underlying lawsuit, including e-mail communications. (Id. at 3-4.)

LG, on the other hand, asserts that despite its willingness to narrow the scope of the subpoena to address Motorola's concerns, Motorola "barely produced any responsive documents." (LG's Mem. at 4.) Specifically, LG points out that Motorola only produced certain documents which include several press releases, a one-page letter, and various licensing agreements between Motorola and other companies. (Id. at 4-5.) LG filed the instant motion on May 24, 2010, asking the court to compel Motorola to produce the responsive documents. This matter was referred to this court on June 8, 2010. Motorola filed its response on July 9, 2010, and LG filed its reply on July 21, 2010.*fn5

Analysis

LG's motion to compel is granted in part and denied in part. Federal Rule of Civil Procedure 26 governs the scope of discovery in civil cases. Pursuant to Rule 26, "[p]arties may obtain discovery regarding any non-privileged matter that is relevant to any party's claim or defense . . . . Relevant information need not be admissible at the trial if the discovery appears to be reasonably calculated to lead to discovery of admissible evidence." Fed.R.Civ.P. 26(b)(1). With respect to motions to compel, the Seventh Circuit has instructed that a "district court may grant or deny the motion in whole or in part, and similar to a ruling on a request for a protective order under Rule 26(c), the district court may fashion a ruling appropriate for the circumstances of the case." Gile v. United Air Lines, Inc., 95 F.3d 492, 496 (7th Cir. 1996). District courts are afforded broad discretion in resolving discovery disputes. See Peals v. Terre Haute Police Dep't, 535 F.3d 621, 629 (7th Cir. 2008).

A. Documents Pertaining to Standards-Setting Organizations*fn6

LG first contends that Motorola should be compelled to produce documents related to GI and Motorola's activities with standards-setting organizations ("SSOs"). (LG's Mem. at 6-10.) LG contends these documents are relevant to LG's standards estoppel affirmative defense because, in the underlying lawsuit, Vizio alleges that LG's compliance with SCTE 07 and ITU-T J.83 amounts to infringement of the Vizio patents. (Id. at 7.) LG raises its affirmative defense on the basis of the Federal Circuit's ruling in Qualcomm, Inc. v. Broadcom Corp., 548 F.3d 1004 (Fed. Cir. 2008), holding that the enforcement of a patent is precluded where an SSO member is subject to a disclosure duty and subsequently breaches that duty. Thus, LG contends that because GI and Motorola participated in the development of the SCTE 07 and ITU-T J.83 industry standards, its understanding and treatment of these patent policies are highly relevant to LG's defense. (Id.) LG points out that it first sought discovery on this issue from Vizio, but Vizio claimed it did not know whether GI and Motorola had a duty to disclose or actually disclosed any of the patents at issue to the relevant SSOs, including SCTE 07 or ITU-T J.83. (Id.)

Motorola, however, contends that contrary to LG's unsupported contention, it did not participate in the development of the two industry standards that form the basis of Vizio's claims in the underlying lawsuit because these standards were promulgated before Motorola acquired GI. (Motorola's Resp. at 6-7.) Motorola represents that it provided LG with all of the non-privileged documents pertaining to SCTE 07 and ITU-T J.83 that it has in its possession, custody, and control after conducting a reasonable search of its records. (Id. at 7.) Furthermore, Motorola informed LG that it did not make any intellectual property rights ("IPR") disclosures regarding the Vizio patents to ANSI, SCTE, or ITU, and produced a number of documents ...


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