Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 1 of 19 PageID #: 56762
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
`
`AREND! S.A.R.L.,
`
`Plaintiff,
`
`V.
`
`GOOGLELLC,
`
`Defendant.
`
`)
`)
`)
`) C.A. No. 13-919-JLH
`)
`
`)
`
`)
`)
`
`) Original Version Filed: May 18, 2023
`
`
`
`) Public Version Filed: May 25, 2023
`
`__________________
`
`AREND! S.A.R.L.'s OPPOSITION TO NON-PARTY APPLE INC.'S
`
`
`MOTION FOR SANCTIONS
`
`
`
`
`
`The Comi should deny non-paiiy Apple Inc.'s motion for sanctions because there is
`
`
`
`
`
`
`
`nothing improper-let alone sanctionable-about the way Arendi, its counsel, or its damages
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`expert handled confidential info1mation at trial. To the contraiy, as the Court saw firsthand, Arendi
`
`
`
`took special precautions throughout trial to safeguard the infonnation Apple and other entities
`
`
`
`
`
`
`
`
`
`sought to keep confidential.
`
`
`
`
`
`
`
`
`
`
`
`Apple's motion advances unfounded and haimful speculation about a single witness's
`
`
`
`
`
`inadve1ient, unsolicited, and momenta1y disclosure of two dollar figures during spontaneous
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`redirect examination. Neither disclosure violated any Comi order, and neither figure has since
`
`
`
`
`
`
`
`become public infonnation. The accusations against Arendi 's counsel are refuted by the record
`
`
`
`
`
`
`
`
`
`
`
`
`
`itself, given that the question preceding the disclosure plainly did not call for the witness to reveal
`
`
`
`
`
`
`
`
`
`
`
`any confidential info1mation. The relevant question is bolded below:
`
`
`
`
`
`
`
`
`
`Q.You were asked several questions about the difference between the actual license
`
`
`
`
`
`and Apple and hyp othetical rates you ai·e
`
`
`rates that were agreed to with Samsung
`
`
`opining on. Do you recall that?
`
`A.I do.
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 2 of 19 PageID #: 56763
`
`
`
`Q. Do the differences between the real-world rates that were agreed to and the
`hypothetical rates impact your assessment of whether your multiplier was
`conservative?
`
`A. Actually I think [it] supports my position that the multiplier was conservative.
`The analysis I did in connection with the Apple license that produced an estimate
`on my part of [Damages Figure] as the result of a hypothetical negotiations, versus
`the [Settlement Amount] license, which resulted from a real-world negotiation,
`demonstrates to me the significant differences that exist in the real-world-
`negotiation where there are other terms and other assumptions from a hypothetical
`negotiation where there are very strict rules about what’s assumed and what
`information is available to the parties.
`
`
`Decl. of Seth Ard (“Ard Decl.”), Ex. A at 641:11-642:5. That Apple seeks sanctions for the bolded
`
`question above is bewildering and worse is that it would ascribe some improper motivation to
`
`Arendi’s counsel in asking it. The question was general in nature and about the impact of
`
`differences between real-world and hypothetical negotiations. It in no way sought or intended to
`
`elicit confidential information.
`
`By contrast, every single time that Arendi anticipated a question might call for confidential
`
`information, including on two separate occasions during the direct examination of Mr. Weinstein,
`
`Arendi duly sought permission to close the courtroom. Id. at 575:24-576:1, 588:23-589:3. In its
`
`opening and closing examinations, to avoid having to seal the courtroom, Arendi’s counsel worked
`
`with Apple’s counsel, Google’s counsel and the Court on an agreed protocol: namely that
`
`demonstratives reflecting the value of the license agreements would be printed and handed out to
`
`the jury to avoid having those demonstratives placed on the screen viewable to the public. With
`
`this protocol, Arendi’s counsel could then refer the jury to the demonstrative in argument without
`
`having to say those numbers in open court. Arendi did this even though the other three licensees
`
`– Samsung, MMI and Microsoft – did not take the position that the public should be shielded from
`
`this information during an open trial. Only Apple did. Though there is a fundamental question
`
`2
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 3 of 19 PageID #: 56764
`
`
`
`about whether Apple’s position comports with the access to courts required by the Constitution,
`
`Arendi nonetheless went to great lengths to comply with Apple’s request.
`
`Arendi also followed this protocol in the direct examination of the relevant expert witness,
`
`closing the courtroom on two separate occasions when counsel anticipated that his answers might
`
`reveal confidential information. In the attached declaration, the expert witness explains what
`
`should be obvious from the context: his disclosure during a single question on spontaneous redirect
`
`was inadvertently made while the courtroom was unsealed. See Decl. of Roy Weinstein.
`
`
`
`Critically, the inadvertent disclosure was quickly remedied, and Apple has never argued
`
`otherwise: in the break following the inadvertent disclosure, the Court conditionally sealed the
`
`trial transcript without opposition from Arendi. The transcript section—including the momentarily
`
`disclosed figures at issue in this motion—has remained under seal ever since. That should have
`
`ended the matter. Notably, Apple has never identified any other remedy it thinks is appropriate to
`
`address the inadvertent reference beyond sealing the record. Apple has also not substantiated any
`
`harm from the disclosure—nor could it given the conditional sealing of the record and lack of
`
`evidence that anyone was in the courtroom who was not affiliated with the case. Cf. Trial Tr. (4/26)
`
`at 512:17-513:11 (“So based on what I’ve seen so far here, we’ve had no one from the public that
`
`is not associated with this case in some way that’s been excluded from the courtroom.”).
`
`
`
`Instead of letting the Court’s cure bring this issue to a close, in contrast to the prompt efforts
`
`Arendi’s counsel went through, Apple waited until the day after the jury rendered its verdict—a
`
`full week after the events above transpired—and then pursued a highly publicized attack against
`
`Arendi and its counsel, filing a sanctions motion premised on a wild and completely
`
`unsubstantiated allegation about “bad faith” motives of Arendi and its counsel:
`
`On the other hand, Plaintiff and its counsel have strong motivations to push the
`envelope on “inadvertently” disclosing Apple’s confidential information so that the
`
`3
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 4 of 19 PageID #: 56765
`
`
`
`public can know how much Apple paid to license Plaintiff’s patents, to the ultimate
`benefit of Plaintiff’s licensing regime and Plaintiff’s counsel’s litigation strategy in
`this and other cases.
`
`
`Dkt. 538 at 8. Apple’s accusation that Arendi and its counsel intentionally disclosed the licensing
`
`information to support their “litigation strategy in this and other cases” has no basis—Apple offers
`
`not a single citation to anything in support of this baseless claim, which is extremely dangerous
`
`and appears to be a threat to counsel who may be adverse to Apple elsewhere. It is also contradicted
`
`by Arendi’s conduct. Arendi sought to seal the courtroom on six different occasions when the
`
`licensing or other confidential information arose. See Ard Decl., Ex. A at 154:13-15, 244:1-6,
`
`245:7-16, 434:16-18, 575:24-576:1, 588:23-589:3; 1337:15-16. Arendi did not object to
`
`conditional sealing of the record above. Id. at 655:8.
`
`Apple’s argument that Arendi’s counsel improperly repeated Mr. Weinstein’s Damages
`
`Figure in a follow-up question is equally baseless. This disclosure was inadvertently made while
`
`the Court room was unsealed, in response to testimony that had just mentioned the same number.
`
`Further, the disclosure is expressly permitted by the Protective Order. This Damages Figure is not
`
`confidential Apple information, nor does it not reveal any confidential information of Apple.
`
`Rather, it is a number that Arendi’s expert reached in his own damages opinion against Apple
`
`based on his own analysis. It was simply his opinion on damages. The Protective Order does not
`
`“prevent or restrict a Producing Party’s own disclosure or use of its own Protected Material for
`
`any purpose.” D.I. 16-1 at § 4(B); see also D.I. 16-1 at § 10(F) (“Nothing in this Order shall restrict
`
`in any way a Producing Party’s use or disclosure of its own Protected Material.”).
`
`Notwithstanding the lack of any actual public disclosure or harm to Apple, Apple has
`
`improperly moved for sanctions against Arendi. The motion should be summarily denied as
`
`procedurally improper: Apple did not move to intervene in this action in which it is not a party; it
`
`4
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 5 of 19 PageID #: 56766
`
`
`
`did not obtain leave of Court to do so; and it did not even give notice to Arendi of this motion or
`
`seek to meet and confer. Aside from those concerning procedural flaws, Apple’s motion lacks any
`
`merit. The motion appears to be driven by other goals and motivation (particularly given its
`
`extensive coverage in the press), not evidence. Apple’s unsupported and false allegations about
`
`the motives of Arendi and its counsel should be the real focus of improper conduct.
`
`I.
`
`BACKGROUND
`
`Nearly ten years ago, the Court entered an Agreed Protective Order in this case. D.I. 16. It
`
`allows information to be designated “CONFIDENTIAL OUTSIDE COUNSEL ONLY” only if it
`
`is “extremely confidential and/or sensitive in nature” and “the Producing Party reasonably
`
`believes” its disclosure outside of a narrowly-defined group “is likely to cause economic harm or
`
`significant competitive disadvantage.” D.I. 16-1 at § 6(D)(1). The Protective Order does not
`
`“prevent or restrict a Producing Party’s own disclosure or use of its own Protected Material for
`
`any purpose.” D.I. 16-1 at § 4(B); see also D.I. 16-1 at § 10(F) (“Nothing in this Order shall restrict
`
`in any way a Producing Party’s use or disclosure of its own Protected Material.”).
`
`In September 2021, Arendi and Apple entered into a Settlement and License Agreement
`
`(hereafter, the “Apple Agreement”) to resolve a separate lawsuit between Arendi and Apple. The
`
`Apple Agreement included a dollar figure payment term (the “Settlement Amount”). PX0066
`
`(Apple Agreement). As publicly disclosed in Apple’s motion, Section 7.1 of the Agreement
`
`required both parties to keep the Agreement’s terms confidential; however, Section 7.1 permitted
`
`disclosure “during the course of litigation,” so long as the disclosure was subject to a protective
`
`order, limited to outside counsel, and followed written notice. Id. Arendi complied with those
`
`terms and disclosed the Apple Agreement to Google’s outside counsel on November 17, 2021.
`
`Before Arendi and Apple settled in 2021, Arendi had served an expert damages report by
`
`Roy Weinstein in its case against Apple. In that report, Mr. Weinstein had opined that a reasonable
`5
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 6 of 19 PageID #: 56767
`
`
`
`royalty for Apple to pay Arendi would be a certain dollar figure (the “Damages Figure”). Ard
`
`Decl., Ex. A at 625:5-7. This Damages Figure is not confidential Apple information. It is a number
`
`that Mr. Weinstein opined on based on his own analysis of a reasonable royalty as to that entity.
`
`Standing alone, the Damages Figure does not convey any confidential Apple information. Nor
`
`does it permit anyone to calculate confidential Apple information.
`
`At trial, Apple voluntarily allowed the Settlement Amount to be made available to its
`
`competitor, Google, without consulting Arendi. Ard Decl., Ex. A at 1490:8-12 (Google’s Counsel:
`
`“So I do believe both sides are going to end up talking about the settlement terms from those
`
`various agreements ... [W]e do have the permission from Apple that our corporate representative,
`
`Mr. Choc, can stay in the courtroom for the closings regardless of whether they are sealed or not.”).
`
`Before trial in this matter, Arendi took precautions regarding the potential use of
`
`confidential information at trial. On March 27, 2023, Arendi moved in limine to exclude from the
`
`trial any reference to the Damages Figure. D.I. 442, Ex. 8P (Arendi’s first motion in limine).
`
`Google opposed the motion, and the Court denied it. D.I. 455 at ¶ 9.
`
`On April 4, 2023, Arendi expressly notified Apple that the Settlement Agreement would
`
`be discussed during trial, and made clear that “the courtroom will be sealed during discussion of
`
`its terms other than the total payment amount.” Ard Decl., Ex. B at 7. Arendi offered to discuss
`
`the matter with Apple in emails sent on April 4, April 7, April 12, April 18, and April 21, 2023.
`
`Id. Counsel for Arendi and Apple spoke on April 21, and Apple objected to Arendi’s proposal. Id.
`
`Apple stated: “If Arendi still intends to use the existence and amount of the Apple-Arendi license
`
`in its opening statement, Apple will raise it with the Court on Monday morning.” Id. Counsel for
`
`Arendi also notified Arendi’s other licensees, including Microsoft and Samsung, of its intent to
`
`6
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 7 of 19 PageID #: 56768
`
`
`
`disclose information from those license agreements during trial, and none requested that the
`
`courtroom be sealed.
`
`Given Apple’s concerns, during trial, Arendi repeatedly requested that the courtroom be
`
`sealed whenever it expected to discuss terms of the Apple Agreement. E.g., Ard Decl., Ex. A at
`
`575:21-576:5; 588:23-589:11. To avoid disclosing the Settlement Amount in open court during
`
`opening and closing statements, Arendi distributed physical demonstratives to the jurors (which
`
`the Courtroom Deputy subsequently collected). Indeed, during Mr. Weinstein’s examination—
`
`which is the only examination at issue in Apple’s motion—Arendi twice requested to seal the
`
`courtroom. Id.
`
`Apple’s motion is singularly focused on a moment during Mr. Weinstein’s examination on
`
`April 26, 2023, when the courtroom was not sealed and information relating to the Settlement
`
`Amount and Damages Figure were divulged. This took place during Mr. Weinstein’s redirect
`
`examination, after counsel for Arendi asked, “Do the differences between the real-world rates that
`
`were agreed to and the hypothetical rates impact your assessment of whether your multiplier was
`
`conservative?” Id. at 641:17-19. In a spontaneous response, Mr. Weinstein mentioned the
`
`Settlement Amount and Damages Figure. Id. at 641:20-642:5. Arendi’s question did not call for
`
`Mr. Weinstein to divulge either amount. Two questions later, Arendi’s counsel restated the
`
`Damages Figure but not the Settlement Amount. Id. at 642:15-19.
`
`At the next break, counsel for Apple requested that the Court conditionally seal the
`
`transcript. Ard Decl., Ex. A at 654:23-655:3. Arendi did not object. Id. at 655:8. The Court
`
`immediately granted that request and asked Apple to file a motion and application for redaction.
`
`Id. at 655:11-14. Only a brief period (equivalent to 13 pages of transcript) separated Mr.
`
`Weinstein’s disclosure from the Court’s conditional sealing of the transcript. There is no evidence
`
`7
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 8 of 19 PageID #: 56769
`
`
`
`that any member of the public was present in the courtroom at the time of the disclosure. Indeed,
`
`as the Court observed during trial, sealing the courtroom generally only had the effect of excluding
`
`a handful of personnel associated with Apple and Google. Id. at 512:17-513:11 (“So based on what
`
`I’ve seen so far here, we’ve had no one from the public that is not associated with this case in some
`
`way that’s been excluded from the courtroom. . . . I’ll put on the record that when we’ve sealed
`
`the courtroom, my understanding is that there were only a couple of people excluded that were
`
`related to in-house people who weren’t permitted to see confidential information . . . .”).
`
`On April 26, 2023, after Mr. Weinstein’s testimony, Apple’s counsel emailed Arendi’s
`
`counsel that it intended to file a motion to seal portions of the trial transcript and asked Arendi to
`
`join the request. Ard Decl., Ex. C. Arendi responded that evening, writing “thanks for reaching
`
`out. Please send us a draft of the motion you’d like us to join.” Id. Arendi, though it had no
`
`objection regarding sealing, could not join a motion it had not seen or which might have
`
`representations which Arendi rightfully wanted to review in advance. Apple did not respond to
`
`provide a draft of the motion, and instead filed its motion unilaterally. D.I. 491. Apple then filed a
`
`renewed motion to seal on May 3, 2023. D.I. 537. Both motions noted, correctly, that Arendi did
`
`not oppose the sealing request. D.I. 491 at 1; D.I. 537 at 1 (incorporating D.I. 491).
`
`Apple has not communicated with Arendi about the disclosure of the Settlement Amount
`
`or Damages Figure at any time since April 26. Apple did not inform Arendi of its instant motion
`
`for sanctions before filing it.
`
`II.
`
`ARGUMENT
`A.
`
`AN INADVERTENT DISCLOSURE THAT WAS PROMPTLY
`CORRECTED DOES NOT WARRANT SANCTIONS.
`
`Apple identifies several factors that guide courts’ imposition of sanctions, but Apple fails
`
`to apply them or identify the limitations on the Court’s sanction authority that Apple’s own cases
`
`8
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 9 of 19 PageID #: 56770
`
`
`
`emphasize. Mot. 5-6. The Court’s authority to impose sanctions “is not a broad reservoir of power,
`
`ready at an imperial hand, but a limited source; an implied power squeezed from the need to make
`
`the court function.” In re Intel Corp. Microprocessor Antitrust Litig., 562 F. Supp. 2d 606, 611
`
`(D. Del. 2008) (quoting Chambers v. NASCO, Inc., 501 U.S. 32, 45 (1991)).
`
`“In order for the court to utilize its inherent power to impose sanctions, the existence of bad
`
`faith is generally required.” Novartis Pharm. Corp. v. Par Pharm., Inc., No. 11-1077-RGA, 2014
`
`U.S. Dist. LEXIS 39704, at *5-6 (D. Del. Mar. 26, 2014) (collecting cases); see also In re Intel,
`
`562 F. Supp. 2d at 611 (sanctions power extends to cases “when a party has acted in bad faith,
`
`vexatiously, wantonly, or for oppressive reasons” (quoting Chambers, 501 U.S. at 43); Citrix Sys.,
`
`Inc. v. Workspot, Inc., No. CV 18-588-LPS, 2020 WL 5884970, at *6 (D. Del. Sept. 25, 2020)
`
`(same). Before imposing sanctions, courts consider “whether there is a pattern of wrongdoing, the
`
`severity of the wrongdoing, and whether the wrongdoing causes prejudice to the opponent or
`
`hampers the administration of justice.” Novartis, No. 11-1077-RGA, 2014 U.S. Dist. LEXIS
`
`39704, at *6; see also Republic of Philippines v. Westinghouse Elec. Corp., 43 F.3d 65, 74 (3d Cir.
`
`1994). Finally, “the court must evaluate the array of possible sanctions and explain why a lesser
`
`sanction to the one selected is inadequate or inappropriate.” Id.
`
`Sanctions are not remotely warranted here because there was no wrongdoing—let alone a
`
`pattern of it—and no bad faith. With rare exception, courts treat a showing of bad faith as a
`
`threshold requirement to sanctions. E.g., Novartis, No. 11-1077-RGA, 2014 U.S. Dist. LEXIS
`
`39704, at *8-12 (denying sanctions due to lack of showing of bad faith); Nova Chems. Corp. (Can.)
`
`v. Dow Chem. Co., No. 13-1601, 2015 U.S. Dist. LEXIS 132383, at *11-13, *20 (D. Del. Sep. 30,
`
`2015) (same); Dow Chem. Canada, Inc. v. HRD Corp., 2012 U.S. Dist. LEXIS 108251, at *10-13
`
`9
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 10 of 19 PageID #: 56771
`
`
`
`(D. Del. Aug. 2, 2012) (vacating Court’s own sanctions order on motion for reconsideration due
`
`to failure to find necessary element of bad faith).
`
`Apple has put forward no evidence of bad faith in this case, nor could it. Arendi’s good
`
`faith treatment of confidential information was on display throughout trial. Arendi and its counsel
`
`consistently and repeatedly took special precautions to keep the Damages Figure and Settlement
`
`Amount confidential. Arendi repeatedly requested to seal the courtroom and, when the courtroom
`
`was unsealed, twice handed out demonstratives to jurors to avoid stating confidential information
`
`out loud.1 The momentary disclosure that Apple’s motion targets was the unintended result of a
`
`broad question Arendi’s counsel asked during spontaneous redirect examination that in no way
`
`called for confidential information in response. The Court promptly sealed the transcript a few
`
`minutes later, without objection from Arendi. Ard. Decl., Ex. A at 655:8. Because Arendi and its
`
`counsel acted in complete good faith to protect confidential information throughout the trial—as
`
`the Court saw firsthand—there is no basis for imposing sanctions.
`
`Sanctions are also inappropriate in view of the fleeting nature of the alleged infraction.
`
`Apple targets a one-time disclosure of two figures. Despite being briefly mentioned in open court,
`
`there is no evidence that either figure has since become public information. See id. at 512:17-
`
`513:11. The Court promptly sealed the trial transcript after disclosure. Id. at 655:11-14. Apple has
`
`
`1 Even before opening statements, Arendi’s counsel informed the Court of Apple’s request to seal
`the courtroom when discussing Apple’s license agreement. Ard. Decl., Ex. A at 51:1-8 (“[T]here
`are some third-party licenses that are referenced in opening, and at least one of those third parties
`[i.e., Apple] has made a request for sealing”); id. at 54:7-13 (“[W]e probably will need to seal the
`courtroom so that [Mr. Hedløy] can talk about the terms of those agreements”). Arendi’s counsel
`agreed not to mention the Settlement Amount during opening or closing arguments to respect
`Apple’s confidentiality concerns. Id. at 52:8-53:4; 1491:19-22. To avoid disclosure during
`examination of its first witness, Mr. Hedløy, Arendi’s counsel repeatedly asked to seal the
`courtroom when discussing the Apple Agreement. Id. at 154:13-20 (on direct); 245:7-13 (on
`redirect). And Arendi’s counsel did the same during the examination of Mr. Weinstein. Id. at
`575:24-576:3 (on direct); 588:23-589:3 (same).
`10
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 11 of 19 PageID #: 56772
`
`
`
`identified no injury to itself or the Court from the disclosure, and Apple has not identified a single
`
`case in which any court has imposed sanctions under similar circumstances. Indeed, Apple’s
`
`motion does not seek a remedy—it simply requests attorneys’ fees for filing a needless motion.
`
`The factors for evaluating the appropriateness of sanctions, as identified in In re Intel
`
`Corp., 562 F. Supp. 2d at 611, likewise make clear that they are not appropriate here. First, the
`
`“nature and quality of the conduct” was an unsolicited, one-time disclosure of two figures—which
`
`Arendi had otherwise protected from public view. Second, neither the “attorney [n]or the client is
`
`responsible” for the disclosure, as the Settlement Amount was disclosed by an expert witness in
`
`response to a question that did not call for it. The Damages Figure is not Apple confidential
`
`information, and its unsolicited disclosure preceded counsel’s restatement of the Damages Figure.
`
`Third, because the disclosure was an isolated event, there was no “pattern of wrongdoing requiring
`
`a stiffer sanction.” Fourth, Apple has advanced no evidence regarding ability to pay. Fifth, Apple
`
`was not “actually prejudiced” by the disclosure because there is no record demonstrating that
`
`members of the public were present in the courtroom and the transcript was promptly sealed. Sixth,
`
`“mitigating factors,” including Arendi and counsel’s otherwise assiduous efforts to keep the
`
`information confidential, and immediate agreement to conditional sealing, further weigh against
`
`sanctions. Apple offers no contrary analysis of these factors in its brief.
`
`The only case Apple advances as supporting its request for sanctions is completely
`
`inapposite. In re Apple Inc. Device Performance Litigation concerned repeated and flagrant
`
`violations of a protective order by counsel. At a motion to dismiss hearing, the lawyer “quot[ed]
`
`directly from the Confidential documents.” No. 5:18-md-02827-EJD, D.I. 350 at 3 (N.D. Cal. June
`
`14, 2019). Then, at a hearing on the motion for sanctions, the lawyer again “disclose[d] Protected
`
`Material by reading from the [motion to dismiss] hearing transcript”—despite having been asked
`
`11
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 12 of 19 PageID #: 56773
`
`
`
`to give notice at hearing if he intended to refer to confidential materials. Id. The lawyer then
`
`proceeded to characterize the dispute as “silliness.” Id. The Court found that the lawyer’s actions,
`
`“if not willful, display a fundamental lack of understanding of the Protective Order.” Id.
`
`In stark contrast, counsel for Arendi took steps throughout trial to seal the courtroom
`
`whenever it anticipated discussing the Settlement Amount or the Damages Figure. See supra.
`
`Arendi had no objection to sealing the transcript when Apple’s counsel raised the issue at the next
`
`break. Ard. Decl., Ex. A at 655:8. Arendi’s counsel neither stated nor intentionally elicited the
`
`Settlement Amount. And, although Arendi’s counsel restated the Damages Figure, this statement
`
`occasioned no further disclosure (and itself does not represent a disclosure of Apple confidential
`
`information). Apple’s motion fails to identify any improper conduct by Arendi, its counsel, or Mr.
`
`Weinstein.2
`
`Apple claims Arendi did not do enough to remedy the disclosure once it happened, but
`
`Apple has not identified anything else that Arendi should have done. The transcript has been
`
`sealed—with Arendi’s assent—since shortly after the disclosure occurred. Ard. Decl., Ex. A at
`
`655:11-14. The Court invited Apple to file its motion to seal the testimony and asked Apple to
`
`apply to redact the transcript. Id.; see also id. at 511:22-512:4; In re Avandia Mktg., Sales Pracs.
`
`& Prod. Liab. Litig., 924 F.3d 662, 670 (3d Cir. 2019). Apple suggests Arendi should have joined
`
`
`2 Apple’s motion does not seek an imposition of civil contempt, yet includes case law regarding
`contempt. Apple has not carried, and its motion does not appear to try to carry, the exacting burden
`to establish civil contempt. Apple’s motion does not even set forth the elements of civil contempt.
`See Mot. 5. “Contempt is a ‘severe remedy,’ and the movant bears a heavy burden to show that
`the charged party is guilty of civil contempt.” INVISTA N. Am. S.a.r.l. v. M & G USA Corp., No.
`CV 11-1007-SLR-CJB, 2014 WL 1908286, at *4 (D. Del. Apr. 25, 2014). Thus, “courts should
`hesitate to adjudge a defendant in contempt when there is ground to doubt the wrongfulness of the
`conduct.’” Id. (quoting F.T.C. v. Lane Labs-USA, Inc., 624 F.3d 575, 582 (3d Cir. 2010)); see also
`Quinter v. Volkswagen of Am., 676 F.2d 969, 974 (3d Cir. 1982) (“[W]here there is ground [t]o
`doubt the wrongfulness of the conduct of the defendant, he should not be adjudged in contempt.”).
`Just as there is no basis for sanctioning Arendi, there is no basis for finding civil contempt.
`12
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 13 of 19 PageID #: 56774
`
`
`
`its motion for sealing; however, Apple fails to mention that it did not provide Arendi a meaningful
`
`opportunity to do so. On the night of Mr. Weinstein’s testimony, Arendi responded to Apple’s
`
`request to join the motion, writing “thanks for reaching out. Please send us a draft of the motion
`
`you’d like us to join.” Ard Decl., Ex. C. Apple never responded—and has not communicated with
`
`Arendi since. Arendi could not join a motion it had never seen. As Apple admits, Arendi had
`
`immediately said it did not oppose the relief that Apple sought (i.e., conditional sealing of the
`
`transcript), and that is all that is relevant. Notably, Apple still has not identified any other relief it
`
`seeks.
`
`Lacking evidence of any impropriety, let alone wrongful acts or bad faith conduct, Apple
`
`retreats to unfounded accusations. Apple ascribes to Plaintiff and its counsel “strong motivations”
`
`to violate the Protective Order. Mot. 8. Apple intimates that the disclosures were intentional and
`
`designed to further “Plaintiff’s licensing regime and Plaintiff’s counsel’s litigation strategy.” Id.
`
`This innuendo makes no sense and itself violates the Court’s rules requiring that factual
`
`contentions be supported by evidence. Cf. Fed. R. Civ. P. 11(b) (deeming attorney’s signature on
`
`filings as certification that motion’s “factual contentions have evidentiary support”).
`
`
`
`There was no such agenda. Arendi and its counsel tried to keep the Damages Figure out of
`
`the trial entirely. Arendi moved in limine to preclude any reference to the Damages Figure during
`
`trial. D.I. 442, Ex. 8P (Arendi’s first motion in limine). Google, not Arendi, insisted on injecting
`
`the Damages Figure into the trial. Furthermore, Apple does not explain how disclosing the
`
`Settlement Amount would advantage Arendi and its counsel. Apple settled for less than other
`
`entities, and Arendi was seeking higher damages in its ongoing trial against Google. In any case,
`
`the Apple Agreement had already been disclosed (with notice to Apple) to outside counsel for the
`
`other entities against whom Arendi has brought claims.
`
`13
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 14 of 19 PageID #: 56775
`
`
`
`B.
`
`THE DISCLOSURE DID NOT VIOLATE ANY COURT ORDER.
`
`Apple’s motion fails for another independent reason: it incorrectly assumes that the
`
`inadvertent disclosure violated a Court order. It did not. The Protective Order in this case permitted
`
`disclosure of the Settlement Amount and Damages Figure. The Protective Order provides,
`
`“Nothing in this Protective Order shall prevent or restrict a Producing Party’s own disclosure or
`
`use of its own Protected Material for any purpose.” D.I. 16-1 at § 4(B). The same rule is reiterated
`
`in section 10(F): “Nothing in this Order shall restrict in any way a Producing Party’s use or
`
`disclosure of its own Protected Material.” D.I. 16-1 at § 10(F). Arendi, as a party to the Apple
`
`Agreement, had independent knowledge and possession of that agreement. The amount that Apple
`
`paid Arendi pursuant to the agreement is as much Arendi’s confidential information as Apple’s.
`
`There is also no basis on which to conclude that the Damages Figure was Apple confidential
`
`information. It was original work product of Mr. Weinstein, Arendi’s damages expert. Arendi was
`
`the “Producing Party” of both the Apple Agreement and Damages Figure in this Google case.
`
`Accordingly, Arendi was free to use that information—its own information, of which it was the
`
`Producing Party—at trial in accordance with the Protective Order.3
`
`The Protective Order also provides that “any person may be examined as a witness at
`
`depositions and trial and may testify concerning all Protected Information of which such person
`
`has prior knowledge independent of this matter.” D.I. 16-1 at § 10(B). Mr. Weinstein necessarily
`
`had knowledge of his own Damages Figure in the Apple case independent of the Google matter.
`
`
`3 Even if Apple were considered the Producing Party, which it is not since it did not produce the
`information, the Protective Order would still permit Arendi to disclose its own Settlement
`Agreement and Damages Figure. Section 10(F) further provides, “Nothing in this Order shall
`restrict in any way the use or disclosure of Discovery Material by a Receiving Party . . . (ii) that is
`lawfully acquired by or known to the Receiving Party independent of the Producing Party.” D.I.
`16-1 at § 10(F). Once again, both the Settlement Agreement and Damages Figure were
`independently known to Arendi before they were produced in this case.
`14
`
`
`
`

`

`Case 1:13-cv-00919-JLH Document 553 Filed 05/25/23 Page 15 of 19 PageID #: 56776
`
`
`
`Thus, section 10(B) also authorized his testimony. Because Arendi did not violate a court order,
`
`sanctions are inappropriate.
`
`
`
`Apple’s motion also cites the confidentiality provisions in Section 7.1 of the Apple
`
`Agreement as a basis for finding that Arendi breached confidentiality obligations. This putative
`
`contract claim is not before the Court. Apple, a non-party, cannot seek sanctions as a remedy for
`
`an unpled contract c