Hold on for this shocker: Samsung's outside counsel provided Samsung executives, internal attorneys, and even external attorneys working on other cases with details of a highly confidential licensing agreement between Apple and Nokia despite a court order not to do so. Better yet, Samsung then further shared those details, on several occasions, with more than 50 internal employees.
This could lead to sanctions for Samsung.
Orders and Secrecy
At the heart of the issue is a licensing deal reached between Nokia and Apple. Terms of the deal are confidential, meaning that neither Apple nor Nokia want them disclosed lest it be used by competitors to aid their own negotiations. This is fairly typical for licensing agreements, but its de rigueur for Apple, which keeps everything it can secret.
Those terms, however, became involved in Apple's patent battle with Samsung, and the way the courts handled the situation was to give Samsung's outside attorneys at Quinn Emmanuel access to the terms. A protective order accompanied that access prohibiting the firm from sharing those details with Samsung's internal executives and attorneys.
Opposite Day
According to court documents first reported by Florian Mueller, precisely the opposite happened. Outside counsel posted documents to an internal Samsung FTP server that was accessible by a host of executives and attorneys. Those documents included all manner of information that should have been redacted.
In addition, “On at least four occasions between March 24, 2012 and December 21, 2012, Samsung's outside counsel emailed a copy of some version of the report to Samsung employees, as well as various counsel representing Samsung in courts and jurisdictions outside the United States,” the court documents stated.
All told, “The information was then sent, over several different occasions, to over fifty Samsung employees, including high-ranking licensing executives.”
Also—and I know this will shock you—Samsung has not been cooperating with the efforts of Magistrate Judge Paul S. Grewal of the United States District Court for the Northern District of California to uncover what happened. The company has not turned over discovery ordered by the judge or made Dr. Seungho Ahn, the Samsung executive who told Nokia he knew the terms of the Apple licensing deal, available for deposition.
Perhaps, then, it shouldn't be a surprise that Dr. Ahn dismissed any concern about that by blithely saying, “All information leaks.”
Yes, because that makes it OK.
Values
As Mr. Mueller opined, “All of this is really, really bad.” I'll add that it's indicative of Samsung's corporate values. This is, after all, the company caught red-handed deliberately copying Apple's intellectual property and designs, and more recently faking benchmarking results for some of its Android devices to make them appear faster than they are.
At every turn, Samsung reveals itself to be a company desperate for unearned recognition, a company willing to do anything to “win,” including copying the work of even its partners. The company even resorted to proving that Apple invented something to get Apple's patent over that invention invalidated in Germany, something I find repellent.
It's been one thing after another in recent weeks, and it has really turned me off of Samsung. In the court of public opinion, Samsung has a strong base of supporters who bizarrely defend the company as an innovator while calling Apple the copyist. It's perplexing to understand how a rational person could arrive at that opinion.
In the court of U.S. law, things have gone differently. Samsung has been convicted of copying, and the company and/or its outside attorneys could face sanctions for this latest stunt. U.S. judges don't tend to be happy about people or companies violating their orders or resisting the discovery process, especially when that discovery process was ordered by the judge.
It's possible that this will turn out to be some kind of giant misunderstanding, but considering Samsung's track record, I expect further revelations about Samsung mishandling evidence and using that information to its advantage elsewhere.
It remains to be seen what Judge Grewal does about it, but I hope it's significant.
[Update: The article was corrected to refer to Quinn Emmanuel as Samsung's outside lawfirm. A hat tip to @FloridaLegal for catching that for me. – Bryan]