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`RECORD NOS. 19-1290(L), 19-1300
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`
`In The
`United States Court of Appeals
`For The Fourth Circuit
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`SAS INSTITUTE, INC.,
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`v.
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`Plaintiff – Appellee,
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`WORLD PROGRAMMING LIMITED,
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`Defendant – Appellant.
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`ON APPEALS FROM THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF NORTH CAROLINA
`AT RALEIGH
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`BRIEF OF APPELLEE
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`Pressly M. Millen
`Raymond M. Bennett
`Samuel B. Hartzell
`WOMBLE BOND DICKINSON (US) LLP
`555 Fayetteville Street, Suite 1100
`Raleigh, North Carolina 27601
`(919) 755-2158
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`Counsel for Appellee
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`THE LEX GROUP 1108 East Main Street Suite 1400 Richmond, VA 23219
`(804) 644-4419 (800) 856-4419 Fax: (804) 644-3660 www.thelexgroup.com
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 1 of 69
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`USCA4 Appeal: 19-1290 Doc: 7 Filed: 04/02/2019 Pg: 1 of 2
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`UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
`DISCLOSURE OF CORPORATE AFFILIATIONS AND OTHER INTERESTS
`Disclosures must be filed on behalf of all parties to a civil, agency, bankruptcy or mandamus
`case, except that a disclosure statement is not required from the United States, from an indigent
`party, or from a state or local government in a pro se case. In mandamus cases arising from a
`civil or bankruptcy action, all parties to the action in the district court are considered parties to
`the mandamus case.
`
`Corporate defendants in a criminal or post-conviction case and corporate amici curiae are
`required to file disclosure statements.
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`If counsel is not a registered ECF filer and does not intend to file documents other than the
`required disclosure statement, counsel may file the disclosure statement in paper rather than
`electronic form. Counsel has a continuing duty to update this information.
`
`No. 19-1290
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`Caption: SAS Institute Inc. v. World Programming Limited
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`Pursuant to FRAP 26.1 and Local Rule 26.1,
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`SAS Institute Inc.
`(name of party/amicus)
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`who is
`, makes the following disclosure:
`Appellee
`(appellant/appellee/petitioner/respondent/amicus/intervenor)
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`1.
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`2.
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`3.
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`Is party/amicus a publicly held corporation or other publicly held entity? | | YES 0NO
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`□ YES0NO
`Does party/amicus have any parent corporations?
`If yes, identify all parent corporations, including all generations of parent corporations:
`
`Is 10% or more of the stock of a party/amicus owned by a publicly held corporation or
`other publicly held entity?
`□ YES0NO
`If yes, identify all such owners:
`
`09/29/2016 SCC
`
`- 1 -
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 2 of 69
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`USCA4 Appeal: 19-1290 Doc: 7 Filed: 04/02/2019 Pg: 2 of 2
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`4.
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`5.
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`6.
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`Is there any other publicly held corporation or other publicly held entity that has a direct
`financial interest in the outcome of the litigation (Local Rule 26.1(a)(2)(B))? I I YESF^I NO
`If yes, identify entity and nature of interest:
`
`□yes □ NO
`Is party a trade association? (amici curiae do not complete this question)
`If yes, identify any publicly held member whose stock or equity value could be affected
`substantially by the outcome of the proceeding or whose claims the trade association is
`pursuing in a representative capacity, or state that there is no such member:
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`Does this case arise out of a bankruptcy proceeding?
`If yes, identify any trustee and the members of any creditors’ committee:
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`□YES0NO
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`Signature: /s/ Pressly M. Millen
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`Counsel for: SAS Institute Inc.
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`Date:
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`April 2, 2019
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`CERTIFICATE OF SERVICE
`
`'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k'k
`
`I certify that on
`the foregoing document was served on all parties or their
`April 2, 2019,
`counsel of record through the CM/ECF system if they are registered users or, if they are not, by
`serving a true and correct copy at the addresses listed below:
`
`/s/ Pressly M. Millen
`(signature)
`
`April 2, 2019
`(date)
`
`-2-
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 3 of 69
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`TABLE OF CONTENTS
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`A.
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`The Underlying Action, Judgment, and Appeal ................................... 3
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`Page
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`TABLE OF AUTHORITIES .................................................................................... iv
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`INTRODUCTION ..................................................................................................... 1
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`STATEMENT OF THE CASE .................................................................................. 3
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`i.
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`SAS’s Litigation in the U.S. and U.K. against WPL .................. 3
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`ii.
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`The Appeal .................................................................................. 5
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`
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`1.
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`SAS’s Appeal of the Permanent Injunction Denial .......... 5
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`2. WPL’s Appeal on Preclusion and Evidentiary
`Grounds ............................................................................. 6
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`B. After Appeal, Evidence of WPL’s Financial Position and Intent
`to Avoid the Judgment in the U.K. Becomes Clear .............................. 8
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`C.
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`SAS Initiates Enforcement Proceedings in California .......................... 8
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`D.
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`Proceedings in the U.K. Court ............................................................ 11
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`i.
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`ii.
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`The U.K. Court Refuses to Enforce Any Portion of SAS’s
`Judgment ................................................................................... 11
`
`The U.K. Court Orders SAS to Return Two-Thirds of All
`Collections, Including the Bond and Escrow Payments
`Imposed as Security for WPL’s Appeal ................................... 13
`
`
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`iii.
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`The U.K. Court’s Ex Parte Injunction against SAS ................. 13
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`E. WPL Changes Its License Agreement to Thwart the U.S.
`Judgment ............................................................................................. 16
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`i
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 4 of 69
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`F.
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`SAS Seeks Relief under the All Writs Act and Rule 60 ..................... 17
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`G.
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`The District Court’s Order and Opinion ............................................. 18
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`i.
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`The Anti-Clawback Injunction ................................................. 19
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`ii.
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`The U.S.-Expansion Injunction................................................. 19
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`1.
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`2.
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`Under the AWA .............................................................. 19
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`Under Rule 60(b)(6) ....................................................... 21
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`SUMMARY OF ARGUMENT ............................................................................... 24
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`ARGUMENT ........................................................................................................... 26
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`H.
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`SAS’s Collections................................................................................ 22
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`I.
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`THE ALL WRITS ACT AUTHORIZED THE ANTI-
`CLAWBACK AND U.S.-EXPANSION INJUNCTIONS ................. 26
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`A.
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`The District Court Did Not Abuse Its Discretion When
`Defending Its Judgment from Being Undermined by the
`U.K. Clawback .......................................................................... 27
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`i.
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`ii.
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`The District Court Had Authority under the AWA
`to Issue the Anti-Clawback Injunction ........................... 27
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`Comity Did Not Require the District Court to Defer
`to WPL’s Collateral Attack ............................................ 31
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`iii. WPL’s Notice and Vagueness Objections to the
`Anti-Clawback Injunction Are Inconsistent with the
`Record and Would Not Justify Reversal in Any
`Event ............................................................................... 33
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`B.
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`The District Court Acted within Its AWA Discretion by
`Enjoining WPL’s Expansion in the U.S. Market while the
`Judgment Remains Unsatisfied ................................................. 35
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`ii
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 5 of 69
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`i. WPL Frustrated the District Court’s Judgment by
`Obtaining the U.K. Injunction against Judgment-
`Enforcement Proceedings in the U.S .............................. 36
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`ii. WPL Collaterally Attacked the District Court’s
`Judgment in the U.K ....................................................... 39
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`iii.
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`Its
`The District Court Reasonably Tailored
`Injunction to Expansion in the U.S. Market ................... 40
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`II.
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`RULE 60 IS AN INDEPENDENT BASIS FOR THE U.S.-
`EXPANSION INJUNCTION ............................................................. 43
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`A.
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`B.
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`Extraordinary Circumstances Warrant Rule 60(b)(6)
`Relief ......................................................................................... 44
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`The District Court Did Not Abuse Its Discretion in
`Granting the U.S.-Expansion Injunction................................... 47
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`i.
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`The Injunction Is Necessary to Prevent Irreparable
`Harm ............................................................................... 48
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`ii. Monetary Damages Are Inadequate ............................... 50
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`iii.
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`The Balance of Hardships Favors the Injunction ........... 53
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`iv.
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`The Public Interest Supports the Injunction ................... 55
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`CONCLUSION ........................................................................................................ 57
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`CERTIFICATE OF COMPLIANCE
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`CERTIFICATE OF FILING AND SERVICE
`
`
`
`iii
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 6 of 69
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`TABLE OF AUTHORITIES
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`
`Page(s)
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`
`CASES
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`Aikens v. Ingram,
`652 F.3d 496 (4th Cir. 2011) ......................................................................... 44
`
`
`Buck v. Davis,
`137 S. Ct. 759 (2017) ......................................................................... 44, 45, 46
`
`
`Caldwell v. Smith,
`
`692 S.E.2d 483 (N.C. App. 2010) ................................................................. 31
`
`Cromer v. Kraft Foods N. Am., Inc.,
`390 F.3d 812 (4th Cir. 2004) ......................................................................... 35
`
`
`eBay Inc. v. MercExchange, LLC,
`547 U.S. 388 (2006)........................................................................... 21, 48, 50
`
`
`Gonzalez v. Crosby,
`545 U.S. 524 (2005)....................................................................................... 44
`
`
`Goss Int’l Corp. v. Man Roland Druckmaschinen Aktiengesellschaft,
`491 F.3d 355 (8th Cir. 2007) ......................................................................... 28
`
`
`Grupo Mexicano de Desarrollo S.A. v. All. Bond Fund, Inc.,
`527 U.S. 308 (1999)....................................................................................... 42
`
`
`Hoxworth v. Blinder, Robinson & Co., Inc.,
`903 F.2d 186 (3d Cir. 1990) .................................................................... 48-49
`
`
`In re Gledhill,
`76 F.3d 1070 (10th Cir. 1996) ....................................................................... 46
`
`
`In re March,
`
`988 F.2d 498 (4th Cir. 1993) ......................................................................... 40
`
`
`
`iv
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 7 of 69
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`
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`Karaha Bodas Co. v. Perusahaan Pertambangan
`Minyak Dan Gas Bumi Negara,
`500 F.3d 111 (2d Cir. 2007) .................................................................... 29, 30
`
`
`Kokkonen v. Guardian Life Ins. Co. of Am.,
`511 U.S. 375 (1994)....................................................................................... 26
`
`Laker Airways Ltd. v. Sabena, Belgian World Airlines,
`731 F.2d 909 (D.C. Cir. 1984) ................................................................passim
`
`
`Link v. Wabash R.R. Co.,
`370 U.S. 626 (1962)....................................................................................... 33
`
`
`Local Loan Co. v. Hunt,
`292 U.S. 234 (1934)....................................................................................... 30
`
`
`Paramedics Electromedicina Comercial, Ltda v.
`GE Med. Sys. Info. Techs., Inc.,
`369 F.3d 645 (2d Cir. 2004) .................................................................... 31-32
`
`
`Pashby v. Delia,
`709 F.3d 307 (4th Cir. 2013) ......................................................................... 35
`
`
`Peacock v. Thomas,
`516 U.S. 349 (1996)....................................................................................... 26
`
`
`Marino v. Pioneer Edsel Sales, Inc.,
`349 F.3d 746 (4th Cir. 2003) ......................................................................... 26
`
`
`Nat’l Credit Union Admin. Bd. v. Gray,
`1 F.3d 262 (4th Cir. 1993) ............................................................................. 44
`
`
`Roland Mach. Co. v. Dresser Indus., Inc.,
`
`749 F.2d 380 (7th Cir. 1984) ......................................................................... 51
`
`SAS Inst. Inc. v. World Programming Ltd.,
`874 F.3d 370 (4th Cir. 2017) ..................................................................passim
`
`
`Scardelletti v. Rinckwitz,
`68 F. App’x 472 (4th Cir. 2003) .................................................................... 42
`
`v
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 8 of 69
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`
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`United States ex rel. Rahman v. Oncology Assocs.,
`198 F.3d 489 (4th Cir. 1999) ......................................................................... 42
`
`
`United States v. Christie Indus., Inc.,
`465 F.2d 1002 (3d Cir. 1972) ........................................................................ 35
`
`
`United States v. Cohen,
`152 F.3d 321 (4th Cir. 1998) ......................................................................... 39
`
`United States v. Fuller,
`919 F.2d 139 (table), 1990 WL 190495 (4th Cir. 1990) ............................... 34
`
`
`United States v. N.Y. Tel. Co.,
`434 U.S. 159 (1977)................................................................................. 26, 42
`
`
`United States v. Welsh,
`879 F.3d 530 (4th Cir. 2018) ................................................................... 46, 47
`
`
`STATUTES
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`28 U.S.C. § 1651(a) ................................................................................................. 26
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`Cal. Civ. Proc. Code § 708.510 ................................................................................. 9
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`RULES
`
`Fed. R. Civ. P. 59(e)................................................................................................. 33
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`Fed. R. Civ. P. 60(b)(6) .....................................................................................passim
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`Fed. R. Civ. P. 65(d)(2) ............................................................................................ 33
`
`OTHER AUTHORITIES
`
`Michael J. Danaher, Anti-Antitrust Law: The Clawback and Other Features
`of the U.K. Protection of Trading Interests Act, 1980, 12 Law & Pol’y Int’l
`Bus. 947 (1980) ........................................................................................................ 31
`
`Br. for United States as Amicus Curiae, Goss Int’l Corp. v. Tokyo Kikai
`Seisakusho, 2008 WL 2185728 (U.S. 2008) (No. 07-618) ...................................... 28
`
`vi
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 9 of 69
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`
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`INTRODUCTION
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`In its earlier appeal in this case, Appellant World Programming Limited
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`(“WPL”) argued that the $79 million judgment against it for breach of contract,
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`fraud, and violation of the North Carolina prohibition against unfair trade practices
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`(the “UDTPA”) should be reversed because of WPL’s status as an English company
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`operating under the protections of English and E.U. laws. This Court rejected that
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`argument because “[n]o principle of international comity requires” an outcome that
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`“would frustrate [U.S.] policy goals by barring a North Carolina company from
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`vindicating its rights under North Carolina law on the basis of the E.U.’s contrary
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`policies.” SAS Inst. Inc. v. World Programming Ltd., 874 F.3d 370, 379-80 (4th Cir.
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`2017).
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`After the appeal, Appellee SAS Institute Inc. (“SAS”) registered the judgment
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`in the Central District of California, which assigned WPL’s non-U.K. receivables to
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`SAS. WPL, which has evaded paying the judgment, responded by seeking
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`protection from the U.K. courts. WPL did more than persuade a U.K. court to refuse
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`recognition of the district court’s judgment; WPL convinced that court to enjoin
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`SAS’s enforcement efforts in the U.S. courts and to order SAS to return two-thirds
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`of every dollar collected in the U.S., rendering SAS a debtor to WPL even though
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`WPL owes SAS tens of millions of dollars on the unpaid judgment.
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 10 of 69
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`Faced with those extraordinarily changed circumstances that frustrated its
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`judgment, the district court entered two injunctions. First, the court prohibited WPL
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`from clawing back amounts that SAS collects in the U.S. (the “Anti-Clawback
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`Injunction”). This prevents WPL from converting the $79 million judgment into a
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`$26 million judgment and essentially wiping out the UDTPA liability judgment that
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`compelled the larger award.
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`Second, the court enjoined WPL from licensing its fraudulently created
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`software to new customers for use in the U.S. while the judgment remains unsatisfied
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`(the “U.S.-Expansion Injunction”). This injunction against sales to new customers
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`(not existing customers) is much narrower than the injunction against all U.S. sales
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`the district court denied years ago when it entered the damages judgment. The
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`injunction is also far less disruptive to WPL’s business than the ongoing enforcement
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`proceedings in California that WPL persuaded the U.K. court to block: whereas the
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`California district court held that WPL should be ordered under California law to
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`turn over its non-U.K. revenue, the U.S.-Expansion Injunction permits WPL to keep
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`licensing – and profiting from – its software worldwide; the only limitation is on
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`WPL’s ability to expand its U.S. market share before it satisfies the judgment. That
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`limitation is a measured, rational response to WPL’s extraordinary efforts to
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`undermine U.S. judgment-collection law.
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`2
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 11 of 69
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`
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`The district court did not abuse its discretion. To rule otherwise would mean
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`that a judgment debtor may use foreign courts to overrule U.S. public policy and to
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`collaterally attack federal court judgments. The district court was right to exercise
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`its jurisdiction under the All Writs Act and Federal Rule of Civil Procedure 60(b)(6)
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`in response to those attacks.
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`STATEMENT OF THE CASE
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`A. The Underlying Action, Judgment, and Appeal.
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`i.
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`SAS’s Litigation in the U.S. and U.K. against WPL.
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`As stated in this Court’s earlier opinion, “SAS filed lawsuits against WPL in
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`the U.K. and in the Eastern District of North Carolina.” SAS, 874 F.3d at 376. Both
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`cases “contained claims for copyright infringement and breach of the license
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`agreement,” but the U.S. case “additionally asserted claims for fraudulent
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`inducement…and violation of the North Carolina [UDTPA].” Id.
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`WPL prevailed in the U.K. action, mainly because the U.K. court determined
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`that WPL’s behavior was “protected by [an E.U. Software] Directive,” and therefore
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`SAS “could not enforce any contractual provisions that prohibited it.” Id. at 377.
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`In the U.S., WPL first contested personal jurisdiction but later filed a “Notice
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`of Consent to Personal Jurisdiction,” JA0118-19, because it could no longer “on a
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`commercial basis stay out of the United States.” JA0132-33. The jury eventually
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`rendered its verdict in favor of SAS for $26,376,635 on claims for breach of contract,
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`3
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 12 of 69
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`fraud, and violation of the UDTPA. JA0365-67. The damages award was based on
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`27 customers WPL had lured away from SAS, JA0713-18, JA0844-45, as to which
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`SAS had suffered $13.5 million in lost profits “by the time of trial,” with the balance
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`of the award “based on SAS’s expected damages after trial” related to those same
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`customers, SAS, 874 F.3d. at 386.
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`SAS moved for a permanent injunction against all licensing of WPL’s
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`software for use within the U.S., JA1589-1607, arguing that this injunction was
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`necessary because of (1) the lack of WPL’s
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`, (2) WPL’s
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`
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`, (3) the fact that the U.K. courts would not enforce the trebled amount
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`of the judgment, and (4) SAS’s belief that WPL would resist enforcement in the U.K.
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`JA1643-47.
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`WPL dismissed SAS’s collectability arguments. In a section of its brief
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`entitled “Collectability Is Not An Issue,” WPL ridiculed what it called SAS’s “vague
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`and conclusory claim that it may face difficulty in collecting its judgment.” JA1620.
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`In the end, the district court denied SAS’s request for a permanent injunction
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`against all U.S. licensing, holding that SAS had not met its burden “at this juncture.”
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`JA0500.1 The court concluded that SAS had not shown “that WPL is without the
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`means to pay the judgment in this case or that it will be uncollectible because of the
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`1 All emphases are added unless otherwise noted.
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`4
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 13 of 69
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`U.K. courts.” Id. And the court regarded SAS’s concerns about WPL opposing
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`U.K. enforcement “as pure speculation.” Id. & n.6.
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`ii.
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`The Appeal.
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`On appeal, WPL challenged the money judgment while SAS appealed the
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`injunction denial. Rather than require a full supersedeas bond, the district court ruled
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`that WPL had to post only a
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` bond and to accumulate another
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`
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`in an escrow account. JA1685.
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`1.
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`SAS’s Appeal of the Permanent Injunction Denial.
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`This Court held that the district court’s rejection of the permanent injunction
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`against all U.S. sales was not an abuse of discretion. SAS, 874 F.3d at 384-89. The
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`Court reasoned that “SAS’s award of over $79 million is already going to catch
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`WPL’s attention in any future calculation of risk irrespective of an injunction.” Id.
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`at 386.
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`Responding to SAS’s concerns about collectability, this Court recognized that
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`injunctions have “sometimes been deemed appropriate based on barriers to
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`collectability after judgment,” but agreed with the district court’s holding that SAS
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`had “offered only vague concerns on this front” and had “little but speculation
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`regarding both WPL’s financial status and the U.K.’s unwillingness to enforce
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`portions of its damages award.” Id. at 387. This Court concluded that there “would
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`5
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 14 of 69
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`have to be a stronger evidentiary foundation in this action to justify the strong
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`medicine of injunctive relief.” Id.
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`As for balance of hardships and public interest, this Court emphasized its
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`concerns for “concrete harms to WPL’s existing customers” because those
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`“customers would have to expend significant time and money to replace their
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`existing [WPL] systems.” Id. at 388. This Court also observed that while SAS’s
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`“rule of law concerns” were “certainly legitimate, the award of compensatory and
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`punitive damages in this case already serves them well.” Id. This Court highlighted
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`the size of the damages award it believed SAS stood to collect, declaring, “To hold
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`that the possessor of a $79 million judgment has received an inadequate remedy
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`would be astonishing in the absence of firm evidence of that judgment’s illusory
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`character, which was not presented here.” Id. at 387.
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`2. WPL’s Appeal on Preclusion and Evidentiary
`Grounds.
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`On cross-appeal, WPL contended that “the proceedings below never should
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`have moved forward, as this action was barred by res judicata due to the U.K.
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`litigation.” Id. at 378. This Court rejected that argument, holding that the “many
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`legal and factual differences between the U.K. litigation and the present suit mean
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`that applying res judicata would have the practical effect of preventing SAS from
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`having its claims heard in any adequate forum,” thus “undermin[ing] [U.S.] and
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`North Carolina policies in favor of the policies of the U.K. and European Union.”
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`6
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`SAS Institute Inc.
`EXHIBIT 2012
`Page 15 of 69
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`Id. at 379. WPL had not “shown that SAS could have chosen to pursue the claims
`
`ultimately adjudicated in the U.S. in the U.K.” Id. “Similarly, the U.S. suit focused
`
`only on sales of [WPL’s software] within the United States, and WPL has not
`
`established that SAS could have recovered for these sales in the U.K.” Id.
`
`Although the “U.K. courts were bound to, and ultimately did, declare portions
`
`of the contract unenforceable based on E.U. law,” this Court held that “SAS’s claims
`
`for fraudulent inducement and UDTPA violations, which were brought only in the
`
`U.S. action, could not have been adequately addressed in the U.K. due to the same
`
`aspects of E.U. law.” Id.
`
`This Court explicitly recognized that “North Carolina public policy and E.U.
`
`public policy are in clear conflict in this case” because the “E.U. Directive that was
`
`dispositive of the contract claims in the U.K.” had “no equivalent” in U.S. law, which
`
`“is more protective of intellectual property [and] the sanctity of contract.” Id. Thus,
`
`this Court ruled that U.S. courts “may refuse...to recognize a foreign judgment on
`
`the ground that it conflicts with the public policy of [the] state.” Id. (internal
`
`quotation omitted, emphasis and alterations in original).
`
`Because of the clear public policy conflict, this Court refused WPL’s
`
`invitation to grant “the U.K. judgment preclusive effect,” holding that “[n]o principle
`
`of international comity requires this outcome.” Id. at 379-80. “For similar reasons,”
`
`7
`
`SAS Institute Inc.
`EXHIBIT 2012
`Page 16 of 69
`
`
`
`the Court found that “WPL’s arguments based on issue preclusion are unavailing.”
`
`Id. at 380.
`
`WPL separately took aim at the fraud verdict, contending that the district court
`
`erred in its “decision to exclude relevant evidence regarding the U.K. litigation and
`
`the E.U. Software Directive.” Id. at 384. This Court agreed with the district court’s
`
`determination. Id.
`
`This Court thus rejected WPL’s appeal in its entirety. Id. at 384. The Supreme
`
`Court later denied WPL’s petition for certiorari, which reiterated WPL’s preclusion
`
`arguments. 139 S. Ct. 67 (2018).
`
`B. After Appeal, Evidence of WPL’s Financial Position and Intent to
`Avoid the Judgment in the U.K. Becomes Clear.
`
`After escaping the injunction based on representations that SAS’s money
`
`judgment was sufficient, WPL, post-appeal, confessed it had no
`
`, JA2235,
`
`and finally revealed that it
`
`
`
` JA1822. And after SAS initiated enforcement proceedings in the U.K.,
`
`see Part D, infra, WPL reversed its position and revealed its contention that “SAS
`
`should not be permitted to ‘enforce’ its US judgment” in any respect in the U.K.,
`
`JA0914-15.
`
`C.
`
`SAS Initiates Enforcement Proceedings in California.
`
`In December 2017, SAS registered the judgment against WPL for
`
`enforcement in the Central District of California in order to use an assignment order
`
`8
`
`SAS Institute Inc.
`EXHIBIT 2012
`Page 17 of 69
`
`
`
`procedure available under California Civil Procedure Code § 708.510. Unlike other
`
`state collection laws, this procedure allows a judgment creditor to obtain assignment
`
`not only of rights to payment now due but also those “to become due” from the
`
`judgment debtor’s customers. JA3133. That assignment is useful in enforcing
`
`judgments against judgment debtors, such as WPL, with no physical assets in the
`
`U.S.
`
`On September 5, 2018, the California court granted SAS’s motion by issuing
`
`an order (the “Assignment Order”) assigning to SAS the rights to payment from a
`
`list of WPL’s non-U.K. customers “until such a time as the North Carolina judgment
`
`in the amount of $79,129,905.00 is fully satisfied.” JA3127-36. WPL appealed to
`
`the Ninth Circuit from the Assignment Order. JA1808.
`
`About the same time, WPL began a campaign to thwart the Assignment
`
`Order’s enforcement by making false statements to its customers designed to
`
`convince them to pay WPL rather than SAS. JA3328-40. For example, one WPL
`
`customer received a communication from WPL falsely claiming that “the case has
`
`been vacated” and “all judgments from this case are no longer valid.” JA2082-83.
`
`WPL provided other factually incorrect information designed to keep its customers
`
`from paying SAS, claiming that the “California district court has accepted that it was
`
`mistaken in making this order of assignment.” JA2087. WPL also disparaged the
`
`district court’s judgment affirmed by this Court, telling its customers the judgment
`
`9
`
`SAS Institute Inc.
`EXHIBIT 2012
`Page 18 of 69
`
`
`
`was “the result of a grotesque abuse of internationally recognised judicial process.”
`
`JA2087. It even offered to indemnify its customers who violated the Assignment
`
`Order by paying WPL directly. Id.
`
`Moreover, WPL refused to turn over payments subject to the Assignment
`
`Order. JA2088-92. As the district court found, “WPL had received directly from
`
`US customers over $1.1 million since September 5, 2018,” and WPL “had not shown
`
`any justification” for not turning those amounts over to SAS. ECF 28 at 12.
`
`After WPL filed its Ninth Circuit appeal, the California district court declared
`
`its willingness to enter two indicative orders. The first would require WPL itself to
`
`execute an assignment for the customer payments. JA3273-82, JA3309. The second
`
`indicative order – based on WPL’s obstructionist conduct and its refusal to forward
`
`any of the assigned payments to SAS – would require WPL to turn over to the U.S.
`
`Marshals any assigned payments from non-U.K. customers (the “Turnover Order”).
`
`JA3763-65.
`
`Two motions filed by SAS in the Ninth Circuit seeking remand for entry of
`
`those indicative orders remain unresolved because, as discussed below, WPL
`
`obtained a U.K. court order freezing the proceeding. JA3783-801, JA4052-73,
`
`JA1035-36.
`
`10
`
`SAS Institute Inc.
`EXHIBIT 2012
`Page 19 of 69
`
`
`
`D.
`
`Proceedings in the U.K. Court.
`
`i.
`
`The U.K. Court Refuses to Enforce Any Portion of SAS’s
`Judgment.
`
`In December 2017, SAS filed an enforcement proceeding in a U.K. court
`
`seeking to collect only the compensatory (not treble) damages award for fraud and
`
`violation of the UDTPA. JA0903-12. WPL, in the words of the U.K. court,
`
`contended that enforcement of the U.S. judgment in the U.K. “would be contrary to
`
`public policy.” JA0972. WPL also counterclaimed for “re-payment” of “money
`
`constituting punitive/multiple damages” that WPL claimed it had been “compelled
`
`to pay SAS under US enforcement procedures.” JA0967.
`
`Following a short trial in October 2018, the U.K. court issued its decision on
`
`December 13, 2018, adopting virtually every argument advanced by WPL. JA0966-
`
`1030. The U.K. court ruled that even though “WPL submitted to the jurisdiction of
`
`the US District Court and participated in the process before it,” JA0970, the U.S.
`
`proceedings were “a collateral attack” on the earlier U.K. judgment, “plainly an
`
`attempt to impeach the English judgment,” and “an abusive claim.” JA0997.
`
`WPL persuaded the U.K. court that enforcement of the U.S. judgment in the
`
`U.K. “would be contrary to public policy” on several grounds, JA0972, and the court
`
`“refuse[d] enforcement” of the judgment because it “conflict[s] with the [E.U.]
`
`Software Directive” – an “absolute overriding statutory defense” that “enshrines
`
`rules of English public policy,” JA0970, JA1008, JA1013.
`
`11
`
`SAS Institute Inc.
`EXHIBIT 2012
`Page 20 of 69
`
`
`
`While this Court had ruled on U.S. public policy grounds that neither claim
`
`nor issue preclusion applied to bar the U.S. judgment, SAS, 874 F.3d at 378-80, the
`
`U.K. court – on U.K. public policy grounds – accepted WPL’s preclusion arguments
`
`and found the U.S. proceedings and judgment to be an “abuse of process” under
`
`U.K. law. JA0997. Similarly, the U.K. court came to an opposite conclusion from
`
`this Court about the district court’s evidentiary ruling regarding the Software
`
`Directive. JA0970.
`
`The U.K. court further agreed with WPL that Section 5 of the U.K. Protection
`
`of Trading Interests Act 1980 (“PTIA”) prevents recovery on all parts of SAS’s
`
`claim under the UDTPA, not just the multiple damages portion. JA1025. The U.K.
`
`court concluded that it “makes [no] difference,” JA1024, that the U.S. court
`
`structured its judgment to separate the compensatory and non-compensatory awards
`
`specifically because of the PTIA. JA0483-84. The U.K. court held that its holding
`
`followed the wording and “forceful policy” of this “remarkable Act,” which “was
`
`enacted to discourage the U
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