Samsung strongarmed Nokia with insider Apple info, says Nokia

Apple has asked a US court for sanctions against Samsung, alleging that Samsung executives illegally had access to confidential information on an Apple-Nokia deal. Nokia, meanwhile, has alleged that Samsung execs used that information to gain an unfair advantage when negotiating a license deal with Nokia.

According to a legal filing by US Magistrate Judge Paul S Grewal, obtained by intellectual property analyst Florian Mueller, Samsung executives allegedly had access to contracts that were meant to be seen only by the company’s outside counsel for the purposes of litigation with Apple.

While Apple is pursuing sanctions against Samsung, Nokia is not.

The story is still developing and more details will emerge as the court examines further evidence.

But the court has some idea of the story so far.

The filing says that as part of fact discovery in an ongoing court battle between Apple and Samsung, Apple produced copies of a number of its patent license agreements, including agreements with Nokia, Ericsson, Sharp and Philips. These were all marked “Highly Confidential - Attorney Eyes’ Only”, as permitted by a protective order from the court.

Samsung’s outside counsel later sent Samsung a draft expert report by Dr David J Teece, which concerned damages to be awarded for Apple’s alleged infringement of Samsung’s asserted declared-essential patents.

The report addressed highly confidential, attorneys’ eyes only information, and according to Grewal, the report should have been fully redacted of that information before it was sent to Samsung.

“However, intentionally or inadvertently, it was not,” Grewal said in the filing.

Instead, it contained key terms of each of the license agreements Apple had with Nokia, Ericsson, Sharp and Philips.

Samsung’s outside counsel posted the report on an FTP site.

“An email providing instructions to access the FTP site was addressed to the regular client distribution list used by counsel to provide Samsung personnel updates regarding [the Apple-Samsung case],” Grewal said.

“The information was then sent, over several different occasions, to over 50 Samsung employees, including high-ranking licensing executives. Specifically, 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,” Grewal said.

“Unfair advantage”

Grewal’s filing details a declaration from Nokia Chief Intellectual Property Officer Paul Melin.

Melin declared that in June 2013, at a meeting between Samsung and Nokia licensing executives, Samsung exec Dr Seungho Ahn told Nokia that he knew the terms of an Apple-Nokia license.

Ahn allegedly said Apple had produced the license in its litigation with Samsung and Samung’s outside counsel had shared the terms of the license with Ahn’s team.

Melin said Ahn in fact recited the terms of the license to prove he knew them and told Nokia that “all information leaks”.

According to the court document, “Mr. Melin also reports that Dr. Ahn and Samsung then proceeded to use his knowledge of the terms of the Apple-Nokia license to gain an unfair advantage in their negotiations with Nokia, by asserting that the Apple-Nokia terms should dictate terms of a Samsung-Nokia license.”

“It is possible that Dr Ahn’s encounter with Mr Melin occurred very differently [but] unfortunately, the court cannot say, because Samsung has elected not to provide the court with any sworn testimony from Dr Ahn or anyone else at the meeting,” Grewal said.

Samsung also remained tight lipped about other uses of the Apple-Nokia license, or the other three confidential licenses, Grewal said.

In fact, despite acknowledging that “many dozens of individuals at Samsung and its other counsel have knowledge of confidential license terms that they had no right to access … Samsung’s counsel repeatedly denied even one violation of the protective order, asserting that such a violation can only occur wilfully”, he said.

The full text of the legal filing, available at Mueller’s blog, is well worth a read.

Mueller also has further detail on the situation.

The court ordered that Samsung produce specific evidence including emails pertaining to the four Apple licenses. It also ordered Samsung to make several individuals available for deposition, including Ahn.

The next hearing regarding this motion will be held on 22 October.