Companies Aligned Against Court in Apple-Samsung Record-Sealing Spat

The Recorder, By Vanessa Blum
October 24, 2012

Discovery is closed and the jury trial is over in Apple Inc.'s smartphone showdown with Samsung Electronics Co. But with U.S. Magistrate Judge Paul Grewal and U.S. District Judge Lucy Koh taking pains to keep the record as transparent as possible, some third-party companies caught up in the San Jose patent suit are still fighting to stop public disclosure of proprietary information.

In an emergency motion filed Tuesday, Motorola Mobility asked Koh to overrule two recent orders from Grewal unsealing a summary of licensing negotiations between Motorola and Samsung in 2000. Apple submitted the three-page document in February to support a discovery motion.

Motorola lawyers in the Houston and San Francisco offices of Winston & Strawn insist in court pleadings that financial demands and offers reflected in the document are "highly sensitive and confidential" and "would be harmful to Motorola's ongoing licensing program negotiations."

Grewal, who is building a reputation as an advocate for open access to court records, has not been convinced. On Sept. 18 and again on Oct. 10, Grewal denied motions to keep the record sealed, noting it concerns decade-old negotiations over an expired agreement.

And now the magistrate seems peeved. "Despite this court's two orders requiring the parties to file the document unsealed and unredacted, the court has observed that the parties have not yet filed a proper version," Grewal wrote Tuesday in an order setting a deadline of Friday for the parties to comply.

Motorola took the matter up with Koh, the Article III judge presiding over the case. They asked her to stay Grewal's order.

Tussles over secrecy have been a continuing theme in the blockbuster patent case and are the subject of a pending appeal before the U.S. Court of Appeals for the Federal Circuit.

In August, Apple and Samsung each petitioned the Federal Circuit to overturn an order by Koh that would make public documents containing financial information the companies contend is highly confidential.

Last week, the First Amendment Coalition and the Reporters Committee for Freedom of the Press filed amicus curiae briefs supporting Koh's ruling.

"Private litigants like Apple and Samsung typically prefer to keep their internal documents — including those containing financial information — from the public and the press," states the coalition's brief. "Once a private party becomes engaged in the judicial system, however, it is a participant in a public institution that is presumptively open to the public."

That leaves third-party companies, like Motorola, caught in the crosshairs.

The public interest in transparency "should be less compelling as to information of a third party, particularly when the document at issue was submitted only in connection with a discovery motion," Motorola's lawyers state in their motion.

Motorola's lead attorney, Peter Chassman in the Houston office of Winston & Strawn, referred a request for comment to Google Inc., which purchased Motorola in May.

Motorola's dispute began with a 21-page order from Grewal in September that addressed a backlog of requests to file documents under seal. Some of the requests pertained to filings from early 2012, leading Grewal to bemoan the burden placed on the court.

"Requests for sealing continue to consume the resources of both the parties and the court," Grewal wrote. "Perhaps this is inevitable in a case of this scope and technical complexity, but the court cannot again but wonder at whether there is a better way."

The sealing requests addressed documents attached to discovery motions, which have a lower standard for secrecy than records related to dispositive motions.

Still, Grewal denied the majority of petitions, finding the parties did not offer sufficient justification that harm would result from disclosure. Some of the sealing requests pertained to information already in the public record, he wrote.

Sprint Nextel also took issue with Grewal's order and requested redactions to a document describing problems Sprint had with Samsung's products. Like the Motorola document, the record was filed by Apple to support a discovery motion.

Grewal agreed the parties could black out references to the prices Sprint pays for Samsung handsets. Sprint had described those figures as "extremely confidential trade secrets."