Dec 1 (Reuters) - The biggest legal battle for the
technology industry is playing out in a federal court in
Silicon Valley, where Apple is trying to stop Samsung from
selling Galaxy phones and tablets in the United States.
In the lawsuit, filed in April, Apple accuses Samsung of
"slavishly" ripping off its designs for the iPad and iPhone.
Although there is worldwide interest in the case, the
proceedings have largely been shrouded behind a veil of
secrecy: most of the court papers are sealed, meaning they
can't be viewed by the public.
Filing documents under seal has become almost standard
procedure in many intellectual-property cases -- like Apple
versus Samsung -- as companies claim their trade secrets and
confidential information could come out during litigation.
Judges have surprisingly wide latitude in deciding what should
be kept under wraps and what shouldn't.
Some courts, like the U.S. District Court for the Northern
District of California, where the case is being heard, have
rules requiring that judges specifically sign off on every
request to seal a document -- but these rules set no deadline.
In the Apple/Samsung case, some secrecy requests have
languished for months while investors, academics and tech
bloggers struggled to piece together whatever bits of
information were available.
In every instance that she did issue a ruling on a sealing
motion, U.S. District Judge Lucy Koh in San Jose granted the
request. Just this week she approved six more motions to seal.
Samsung's most crucial legal brief became available after
months of delay -- and then only in redacted form.
The stakes here are high: Samsung had 23.8 percent of the
global smartphone market in the third quarter, nine points
higher than Apple. Yet Samsung's holiday sales could be
jeopardized if Koh, who is expected to rule any day, grants
Apple's motion to halt Samsung's sales of Galaxy.
Lack of transparency in the courts troubles many
"For the judicial system as a whole, we want transparency
so the public can have confidence in the judicial
decision-making process," said Bernard Chao, a professor at the
University of Denver's Sturm College of Law. "When things
aren't transparent, that view is undercut."
In an email on Thursday, Koh declined a Reuters request for
an interview on her sealing decisions in the Apple/Samsung
case, or about her general policies. However, shortly after the
inquiry from Reuters, Koh issued new guidelines governing
sealed documents in her courtroom.
Koh's guidelines, posted on her official website, mandated
that parties file a redacted, publicly available version of
every document that they seek to seal -- at the same time they
make the sealing request.
Koh and U.S. Magistrate Judge Paul Grewal, who oversees
certain procedural motions in the case, are newcomers to the
federal bench and were both previously intellectual property
lawyers representing companies at large law firms. They have
not only granted many of Apple and Samsung's sealing motions,
in some cases, they've gone a step further.
During an October hearing on the proposed injunction, Koh,
unprompted, asked Apple and Samsung if they wanted to seal the
courtroom. When the lawyers said such a step wouldn't be
necessary and that they would not mention confidential material
during the hearing, Koh commented, "I guess if you all can be
careful not to disclose anything that requires sealing, then we
can still have that with the open public."
Representatives from Samsung did not respond to a request
for comment on Thursday, and an Apple spokeswoman declined to
Secrecy in the courts is an ongoing concern. The policy
body of the federal courts recently reminded judges to limit
broad sealing of cases, and interest groups such as Public
Citizen and the American Civil Liberties Union frequently
intervene in cases where major records are sealed.
For their part, investors look at briefs and filings to see
what kind of effect a patent is having on the marketplace,
professors study them for novel legal theories, and lawyers
track them for developments in intellectual property law.
Like Koh, many federal judges routinely grant requests to
seal documents. In the Eastern District of Texas, where the
docket is always clogged with patent cases, lawyers don't even
need permission from the judge to file documents under seal,
said Michael Smith, an IP attorney who practices there.
"The court has made it as easy as they possibly can," Smith
Judges say it's a balancing act.
"It comes down to: 'how do you see the interplay between
transparency and protecting the interests of the party,'" said
U.S. District Judge Jeremy Fogel, director of the Federal
Judicial Center, in an interview. "Transparency sounds so
noble, so apple pie, but the interests of the parties are
The release of Samsung's redacted brief this week
demonstrates some of the inconsistencies in what gets sealed,
Previously, Koh had sealed a separate document because,
according to Samsung, it contained "unreleased product launch
dates, and information relating to Samsung's total number of
employees, and the number of employees involved in the design
and marketing of the products at issue."
Samsung said references to other confidentially-filed
motions in the case justified its sealing, and Apple did not
But in the key Samsung brief released this week, even the
redacted version revealed not only numbers of Samsung employees
(more than 8,500 engaged in telecommunications research and
development projects), but also the dollar amount of its
research and development costs (over $35 billion for
electronics product lines from 2005 to 2010).
When there isn't pushback from one of the parties, judges
typically grant sealing requests without much scrutiny, said
Chao, the University of Denver professor.
"I think at times they are just overwhelmed," Chao said.
Even contemplating closing a courtroom, as Koh did, shows
an unusual level of accommodation to the parties, said Richard
Marcus, a professor at University of California Hastings
College of the Law, and can also erode trust in the courts.
"Locking the courthouse doors in a trial-like situation is
extremely rare and requires exceptional circumstances," he
In fact, 50 miles from the Samsung/Apple battle, U.S.
District Judge William Alsup in San Francisco has taken the
opposite tack in the monster IP fight between Oracle and Google
over the Android operating system.
Since Oracle brought suit in August 2010, Alsup has
rejected more than a half-dozen requests from the companies to
keep material secret and issued a number of harsh warnings.
Among other documents, Alsup unsealed an email drafted by a
Google engineer saying Google needed to negotiate a license for
Java -- the programming language Oracle has accused Google of
Google investigated alternatives to Java for Android and
concluded "they all suck," the email said. Alsup even read the
email aloud during a July hearing. (Google has asked an appeals
court to overturn the unsealing).
"The United States district court is a public institution,
and the workings of litigation must be open to public view,"
Alsup wrote in an October order. Alsup declined to comment, as
did an Oracle spokeswoman. Google representatives did not
respond to a request for comment.
For David Sunshine, a New York lawyer who tracks technology
cases for hedge fund investors, judges like Alsup who challenge
companies on sealing requests make the job much easier. "I
love those guys," Sunshine said.
The Apple/Samsung case in U.S. District Court, Northern
District of California is Apple Inc v. Samsung Electronics Co
Ltd et al, 11-1846.
The Oracle case in U.S. District Court, Northern District
of California, is Oracle America, Inc v. Google Inc, 10-3561.
For Apple: Morrison & Foerster; Wilmer Cutler Pickering
Hale and Dorr; Taylor & Company Law Offices; Bridges &
For Samsung: Quinn Emanuel Urquhart & Sullivan.
(Reporting by Dan Levine and Carlyn Kolker)
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