Rambus wins again as Supreme Court denies Samsung's appeal

In an effort to avoid embarrassment, Rambus sought to end a high-profile patent infringement squabble with competitor Samsung. A district court judge ruled Samsung couldn't let it go, but today the highest court says it must.

The US Supreme Court refused yesterday to hear memory maker Samsung's appeal in a case involving competitor Rambus -- an appeal which would have had wider ramifications on the market at large had it been heard.

Patent infringement cases can become weird just by design, but they can get weirder when there are several of them that share disputes over the same technology. Since 2005, Rambus has been trying to put one such case to rest, conceding defeat on this count and even offering to pay attorneys' fees for plaintiff Samsung.

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But Rambus had a higher purpose in mind: A Virginia district court judge was likely to find against Rambus in a case that would have extremely embarrassing ramifications for the memory design innovator and manufacturer. Samsung claimed that Rambus managed a malicious campaign of litigation that involved evidence control, allegedly crossing into the territory of illegality -- what the law calls spoliation of evidence.

"At issue is some of the most remarkable litigation misconduct to have become the subject of litigation in recent memory," reads Samsung's petition of certiorari to the Supreme Court. "The district court found that respondent [Rambus], in planning an extensive litigation campaign against leading semiconductor manufacturers, including petitioner [Samsung], developed a 'document retention program [as] an integral part of its litigation strategy' that would 'target for destruction documents that are discoverable in litigation.' Respondent sought to get, in its words, 'battle ready' for litigation against the semiconductor industry by shredding millions of pages of documents, holding 'shredding part[ies],' and destroying contract and patent prosecution files directly relevant to the patent litigation respondent pursued."

Rambus was willing to put this case behind it, and in so doing, offered to pay Samsung's attorneys' fees. What that would have done, of course, is precluded District Court Judge Robert E. Payne from rendering a decision; and that decision would have had the effect of collateral estoppel with respect to the other IP suits it was managing, including a major one with Hynix Semiconductor. In other words, if Judge Payne found Samsung's claim to be accurate, no other court would have to prove its accuracy -- the fact could be used elsewhere, including by Hynix, against Rambus.

What happened instead was that Judge Payne ruled that his court retained jurisdiction in the matter of attorneys' fees. That appeared to have the effect of keeping the case open, so that Payne could then render a decision against Rambus -- a decision that would impact Rambus' other pending cases -- even if all Samsung won was attorneys' fees.

But the Federal Circuit Court of Appeals last April ruled in favor of Rambus, on the theory that when Rambus offered to pay Samsung all costs and effectively concede, Judge Payne's decision in that case was rendered moot.

"After Rambus offered the entire amount of attorney fees in dispute, the case became moot," wrote the three-judge panel last April. "The district court had no case or controversy to continue to consider. Thus, the trial court lacked subject matter jurisdiction to perpetuate an attorney fees dispute that was complete...Accordingly, the district court in this case lacked jurisdiction to issue any further opinions in conjunction with an attorney fees dispute that has ceased to exist. Because the district court's writing is an impermissible advisory opinion, this court vacates that advisory opinion as issued without jurisdiction."

In its response to Samsung's petition to the Supreme Court, Rambus defended its legal tactics, saying, "This Court has noted the obvious fact that document destruction is itself routine and legitimate...Only in certain circumstances is document destruction improper. As to Rambus, two of the three judges that have held trials on and independently rendered decisions on the charge of 'spoliation' have rejected it."

But that may not have even played a role here; instead, the fact of Rambus' complete concession in the Samsung matter should render any judgment about Rambus' conduct in that matter moot. In denying Samsung's petition, the Supreme Court effectively upheld the Federal Circuit's findings.

A very short statement from Rambus this morning reads, "With today's Supreme Court order, all appeals have been exhausted and the matter is now closed."

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