Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 1 of 10 PageID# 42904
`
`IN THE UNITED STATES DISTRICT COURT
`
`FOR THE EASTERN DISTRICT OF VIRGINIA
`Richmond Division
`
`SAMSUNG ELECTRONICS CO., LTD.,
`
`Plaintiff,
`
`V.
`
`Civil Action No. 3:14cv757
`
`NVIDIA CORPORATION,
`
`Defendant.
`
`MEMORANDUM OPINION
`
`This matter is before the Court on Samsung Electronics Co.,
`
`Ltd.'s
`
`(''Samsung") oral motion, made during trial,
`
`to exclude
`
`the proposed testimony of
`
`Jay Shim about Samsung's motive for
`
`instituting this
`
`action.
`
`The
`
`proposed
`
`evidence was
`
`to
`
`be
`
`elicited by NVIDIA Corporation (''NVIDIA") as part of its defense
`
`on the issue of
`
`infringement. For
`
`the reasons stated below,
`
`and
`
`on
`
`the record set
`
`forth on
`
`January 26,
`
`2016, Samsung's oral
`
`motion to exclude motive evidence was sustained.
`
`BACKGROUND
`
`This case is about whether NVIDIA's computer chips infringe
`
`a patent owned by Samsung.
`
`On the first day of trial, Samsung
`
`objected to NVIDIA's proposed examination of
`
`a
`
`Samsung vice-
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`
`FOR THE EASTERN DISTRICT OF VIRGINIA
`Richmond Division
`
`SAMSUNG ELECTRONICS CO., LTD.,
`
`Plaintiff,
`
`V.
`
`Civil Action No. 3:14cv757
`
`NVIDIA CORPORATION,
`
`Defendant.
`
`MEMORANDUM OPINION
`
`This matter is before the Court on Samsung Electronics Co.,
`
`Ltd.'s
`
`(''Samsung") oral motion, made during trial,
`
`to exclude
`
`the proposed testimony of
`
`Jay Shim about Samsung's motive for
`
`instituting this
`
`action.
`
`The
`
`proposed
`
`evidence was
`
`to
`
`be
`
`elicited by NVIDIA Corporation (''NVIDIA") as part of its defense
`
`on the issue of
`
`infringement. For
`
`the reasons stated below,
`
`and
`
`on
`
`the record set
`
`forth on
`
`January 26,
`
`2016, Samsung's oral
`
`motion to exclude motive evidence was sustained.
`
`BACKGROUND
`
`This case is about whether NVIDIA's computer chips infringe
`
`a patent owned by Samsung.
`
`On the first day of trial, Samsung
`
`objected to NVIDIA's proposed examination of
`
`a
`
`Samsung vice-
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 2 of 10 PageID# 42905
`
`president.
`
`Jay Shim C'Shim").^ In particular, Samsung sought
`
`to
`
`prohibit NVIDIA from asking questions of Shim intended to show:
`
`that
`
`Samsung
`
`and Taiwan
`
`Semiconductor Manufacturing Company
`
`C'TSMC"),
`
`the company that
`
`fabricated NVIDIA's computer chips,
`
`were competitors
`
`for
`
`a
`
`fabrication contract
`
`from NVIDIA;
`
`that
`
`Samsung brought
`
`this action as
`
`a means of
`
`retaliating against
`
`NVIDIA after NVIDIA chose TSMC as
`
`its fabricator
`
`rather
`
`than
`
`choosing Samsung; and that
`
`this action was
`
`a way for Samsung to
`
`foreclose TSMCs manufacture of NVIDIA's chips
`
`so as
`
`to force
`
`NVIDIA to use Samsung as
`
`the fabricator of NVIDIA chips.
`
`(Tr.
`
`Jan.
`
`26,
`
`2016 173:5-182:1; 223:17-243:7).
`
`Samsung objected on
`
`the grounds
`
`that
`
`such evidence was
`
`irrelevant
`
`to infringement,
`
`and
`
`that
`
`any marginal
`
`relevance
`
`would
`
`be
`
`substantially
`
`outweighed
`
`by waste
`
`of
`
`time,
`
`confusion,
`
`delay,
`
`and unfair
`
`prejudice under Fed. R. Evid.
`
`403.
`
`(Tr. 173:5-174:18). On the
`
`same basis,
`
`Samsung
`
`also
`
`sought
`
`a
`
`curative
`
`instruction to
`
`address
`
`a
`
`thinly
`
`veiled
`
`implication
`
`in
`
`NVIDIA's
`
`opening
`
`statement
`
`that
`
`Samsung
`
`brought
`
`this
`
`action
`
`a
`
`means
`
`of
`
`retaliation
`
`against
`
`NVIDIA.
`
`(Tr.
`
`17 3:5-174:23;
`
`176:14-21,
`
`245:12-255:25). Neither party introduced case law in support of
`
`its respective position on the admissibility of evidence about
`
`permitted, NVIDIA
`the Court
`and
`to,
`agreed
`parties
`^ The
`conducting its direct examination of Shim for NVIDIA's case at
`the beginning of
`trial and thus during Samsung's case-in-chief
`on infringement
`so that Shim could return to Korea.
`(Tr.
`Jan.
`26, 2016 177:12-179:1).
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 3 of 10 PageID# 42906
`
`the motive for bringing a patent
`
`infringement action. Following
`
`a proffer
`
`on Shim's
`
`testimony on motive
`
`(Tr.
`
`180:21-181:1;
`
`223:23-238:16)
`
`and in the continued absence of
`
`any decisional
`
`law that would make
`
`such evidence relevant
`
`to this case,
`
`the
`
`Court
`
`ruled in favor of Samsung on Shim's preferred testimony
`
`and on the statements made during NVIDIA's opening statement.
`
`(Tr. 242:19-243:7; 24 5:12-255:25). The Court subsequently gave a
`
`curative instruction as
`
`to the
`
`implications made
`
`in NVIDIA's
`
`opening
`
`statement.
`
`(Tr.
`
`245:12-255:25;
`
`298:21-299:4).
`
`This
`
`opinion outlines the reasoning for that decision.
`
`A.
`
`As A General Matter, Motive For Bringing Suit Is Irrelevant
`
`LEGAL ANALYSIS
`
`The rule generally prevailing is that, where
`a suitor is entitled to relief in respect
`to
`the matter
`concerning which
`he
`sues,
`his
`motives
`are
`immaterial;
`that
`the
`legal
`pursuit of his
`rights,
`no matter what his
`motive
`in bringing the
`action,
`cannot
`be
`deemed either
`illegal or
`inequitable;
`and
`that
`he may
`always
`insist
`upon his strict
`rights and demand their enforcement.
`
`Johnson
`
`v. King-Richardson Co.,
`
`36 F.2d
`
`675,
`
`677
`
`(1st Cir.
`
`1930) . See also Innovation Ventures, LLC v. N2G Distrib.,
`
`Inc.,
`
`763 F.3d 524,
`
`542
`
`(6th Cir. 2014)
`
`(''Defendants assert
`
`that
`
`they
`
`should
`
`have
`
`been
`
`permitted
`
`to
`
`introduce
`
`evidence
`
`about
`
`Plaintiff's business
`
`strategy of protecting its trademark and
`
`trade
`
`dress
`
`through
`
`litigation
`
`.... Plaintiff's motive
`
`in
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 4 of 10 PageID# 42907
`
`bringing this case was all but
`
`irrelevant — what mattered what
`
`whether Defendants' products were confusingly similar to FHE.");
`
`Caldwell v. Wal-Mart Stores,
`
`Inc.,
`
`229 F.3d 1162
`
`(10th Cir.
`
`2000)
`
`("Absent
`
`some evidence of
`
`fraud on Caldwell's part
`
`(and
`
`none was proffered),
`
`evidence of his
`
`financial motivation to
`
`bring the suit was not
`
`relevant
`
`to any of
`
`the issues in this
`
`case"); Krakover v. Mazur^.
`
`48 F.3d 341, 344
`
`(8th Cir. 1995)
`
`('"As
`
`long as
`
`a plaintiff
`
`is seeking the remedy requested, his bad
`
`motives
`
`for pursuing the suit are irrelevant" to a
`
`state law
`
`abuse of process claim); Lee v. Kucker & Bruh, LLP, No. 12 CIV.
`
`4662 BSJ
`
`JCF,
`
`2013 WL 680929, at
`
`*2
`
`(S.D.N.Y. Feb. 25, 2013);
`
`Piontek v.
`
`I.C. Sys., No. CIV. 1:08-1207, 2009 WL 1044596, at *1
`
`(M.D.
`
`Pa. Apr.
`
`17,
`
`2009); Louisiana Envtl. Action Network v.
`
`Cintas Corp., No. CIV.A.
`
`03-711-C-M2,
`
`2004 WL
`
`6225390, at
`
`*2
`
`(M.D. La. Oct. 1, 2004); Nat'1 Football League Properties,
`
`Inc.
`
`V. Prostyle,
`
`Inc.,
`
`16 F. Supp. 2d 1012, 1021
`
`(E.D. Wis. 1998);
`
`Rhone-Poulenc Rorer
`
`Inc.
`
`v. Home
`
`Indem. Co., No. CIV. A.
`
`88-
`
`9752,
`
`1991 WL 183842, at *2
`
`(E.D. Pa. Sept. 16, 1991); Digital
`
`Equip. Corp. v. Sys.
`
`Indus.,
`
`Inc., 108 F.R.D. 742, 743 (D. Mass.
`
`1986); Sharon v. Time,
`
`Inc.,
`
`599 F. Supp.
`
`538,
`
`586
`
`(S.D.N.Y.
`
`1984) .
`
`However,
`
`this general
`
`rule has been held not
`
`to apply when
`
`a defendant pleads certain equitable defenses such as laches or
`
`estoppel, when there are questions about whether
`
`a plaintiff is
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 5 of 10 PageID# 42908
`
`an appropriate representative of
`
`a class, or when
`
`a plaintiff
`
`seeks
`
`attorneys'
`
`fees
`
`for
`
`bad
`
`faith multiplication
`
`of
`
`proceedings. See, e.g., Lee v. Kucker & Bruh, LLP, No.
`
`12 CIV.
`
`4662 BSJ
`
`JCF,
`
`2013 WL 680929, at
`
`*2
`
`(S.D.N.Y. Feb.
`
`25, 2013);
`
`Parsons v.
`
`Jefferson-Pilot Corp.,
`
`141 F.R.D. 408,
`
`414
`
`(M.D.N.C.
`
`1992)
`
`{"[i]t
`
`is well-established that
`
`in ordinary litigation,
`
`not
`
`involving the clean hands defense,
`
`the plaintiff's motive in
`
`bringing suit
`
`is not
`
`relevant
`
`to the
`
`subject matter of
`
`the
`
`litigation"); Denny v. Carey, 73 F.R.D. 654, 656 (E.D. Pa. 1977)
`
`(finding plaintiff's motive irrelevant
`
`in seeking to certify a
`
`securities litigation class in the absence of evidence tending
`
`to
`
`show
`
`that
`
`named
`
`plaintiff
`
`was
`
`not
`
`suitable
`
`class
`
`representative). Under certain circumstances motive
`
`has
`
`been
`
`found to be admissible for purposes of assessing the credibility
`
`of the testifying witness. Montoya v. Vill. of Cuba, No. CIV 11-
`
`0814 JB/SMV,
`
`2013 WL 6504291, at *1
`
`(D.N.M. Nov. 30, 2013);
`
`Texas Utilities Co. v. Texas Elec. Serv. Co.,
`
`470 F. Supp. 798,
`
`814 (N.D. Tex. 1979).
`
`Although the Court has not
`
`identified any decisions
`
`from
`
`the Courts of Appeals
`
`for
`
`the Fourth Circuit or
`
`the Federal
`
`Circuit
`
`on
`
`this point,
`
`the decisions
`
`of other circuit
`
`and
`
`district courts present
`
`a general rule:
`
`a plaintiff's motive for
`
`bringing suit
`
`is
`
`irrelevant,
`
`except
`
`in the
`
`face of certain
`
`equitable defenses,
`
`bad faith,
`
`or questions of witness bias.
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 6 of 10 PageID# 42909
`
`None of
`
`these exceptions
`
`is present
`
`in this case.^ The Court
`
`accordingly finds
`
`that
`
`the general
`
`rule applies,
`
`and Samsung's
`
`motive is irrelevant
`
`to the underlying questions of infringement
`
`and validity.
`
`In Patent Cases, Absent Violation Of
`B. Motive Is Irrelevant
`Fed. R. Civ. P. 11 Or Patent Misuse
`
`As
`
`a general matter, bringing an infringement action is not
`
`the sort of bad faith that makes motive relevant. Virginia Panel
`
`Corp. V. MAC Panel Co.,
`
`133 F.3d 860,
`
`873
`
`(Fed. Cir. 1997)
`
`("A
`
`patentee may
`
`lawfully police
`
`a market
`
`that
`
`is
`
`effectively
`
`defined
`
`by
`
`its
`
`patent.");
`
`Concrete
`
`Unlimited
`
`Inc.
`
`v.
`
`Cementcraft,
`
`Inc.,
`
`776
`
`F.2d
`
`1537,
`
`1539
`
`(Fed. Cir.
`
`1985)
`
`(''Concrete Unlimited
`
`had
`
`the
`
`right
`
`to
`
`exclude
`
`others
`
`from
`
`making, using,
`
`and selling the invention and to enforce those
`
`rights
`
`until
`
`the
`
`'028
`
`patent
`
`was
`
`held
`
`invalid.
`
`Concrete
`
`Unlimited did only what any patent owner has the right
`
`to do to
`
`enforce
`
`its
`
`patent,
`
`and
`
`that
`
`includes
`
`threatening
`
`alleged
`
`infringers with suit.").
`
`That
`
`is not
`
`to say that
`
`the right
`
`to bring an infringement
`
`action is completely unbounded. For example,
`
`a patentee may not
`
`bring a suit that
`
`is so unreasonable as to run into the regional
`
`circuit's governing law on Fed. R. Civ.
`
`P. 11. Raylon,
`
`LLC v.
`
`the
`these issues as a predicate for
`^ NVIDIA identified none of
`admissibility of Shim's motive testimony (or any like it). The
`sole relevance predicate posited by NVIDIA was
`infringement.
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 7 of 10 PageID# 42910
`
`Complus Data
`
`Innovations^
`
`Inc.^
`
`700 F.3d 1361,
`
`1367-68
`
`(Fed.
`
`Cir. 2012) . However, whether Rule 11 applies is not
`
`a matter to
`
`be decided by the jury. As
`
`such,
`
`it is improper
`
`to raise that
`
`issue before the jury.
`
`Additionally,
`
`a patentee may not engage in patent misuse by
`
`bringing suit for the purpose of perpetuating an anticompetitive
`
`market. E.g., C.R. Bard,
`
`Inc. v. M3 Sys.,
`
`Inc.,
`
`157 F.3d 1340,
`
`1368
`
`(Fed. Cir.
`
`1998). The antitrust underpinnings of patent
`
`misuse,
`
`however,
`
`only prohibit
`
`"bringing suit
`
`to enforce
`
`a
`
`patent with
`
`knowledge
`
`that
`
`the
`
`patent
`
`is
`
`invalid
`
`or
`
`not
`
`infringed,
`
`and the litigation is conducted for anti-competitive
`
`purposes." C.R. Bard,
`
`Inc.,
`
`157 F.3d at 1368.
`
`In Prof'l Real
`
`Estate Inv'rs,
`
`Inc. v. Columbia Pictures Indus.,
`
`Inc.,
`
`508 U.S.
`
`49
`
`(1993),
`
`the
`
`Supreme Court
`
`established
`
`a
`
`two-part
`
`test
`
`applicable in such ''sham"
`
`litigation:
`
`(1)
`
`the lawsuit must be
`
`objectively meritless
`
`such that
`
`''no reasonable
`
`litigant
`
`could
`
`expect
`
`success on the merits;" and
`
`(2)
`
`it must be
`
`found that
`
`"the baseless lawsuit conceals
`
`'an attempt
`
`to interfere directly
`
`with the business
`
`relationships of
`
`a competitor.'"
`
`NVIDIA has
`
`not
`
`raised patent misuse violative of
`
`the antitrust
`
`laws either
`
`as
`
`a
`
`defense or
`
`a
`
`counterclaim.
`
`Thus,
`
`as
`
`this
`
`action is
`
`configured, Samsung's motives are irrelevant,
`
`and are,
`
`rather,
`
`within the bounds of
`
`a patentee's
`
`lawful
`
`right
`
`to "police a
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 8 of 10 PageID# 42911
`
`market
`
`that
`
`is effectively defined by
`
`its patent." Virginia
`
`Panel Corp., 133 F.3d at 873.
`
`That conclusion is further supported by a handful of cases
`
`explicitly stating that motive is irrelevant
`
`in similar,
`
`though
`
`not
`
`identical, situations. See Holmes Grp.,
`
`Inc. v. Vornado Air
`
`Circulation Sys.,
`
`Inc.,
`
`535 U.S.
`
`826,
`
`837-38
`
`(2002)
`
`(finding
`
`that
`
`a defendant's motive
`
`for bringing a
`
`compulsory and non-
`
`frivolous
`
`counterclaim is
`
`irrelevant
`
`to
`
`determining
`
`the
`
`appellate jurisdiction of
`
`the Federal Circuit); Mikohn Gaming
`
`Corp. V. Acres Gaming,
`
`Inc., 165 F.3d 891,
`
`897
`
`(Fed. Cir. 1998)
`
`(finding that
`
`a patentee has
`
`a
`
`right
`
`to enforce its patent,
`
`including threatening alleged infringers with suit,
`
`so long as
`
`the patentee
`
`has
`
`a
`
`good
`
`faith belief
`
`that
`
`its patents
`
`are
`
`infringed);
`
`SGS-Thomson Microelectronics,
`
`Inc.
`
`v.
`
`Int'1
`
`Rectifier Corp.,
`
`31 F.3d 1177
`
`(Fed. Cir.
`
`1994)
`
`(finding that
`
`a
`
`motive
`
`for
`
`patent
`
`assignment
`
`is
`
`irrelevant
`
`to
`
`assigning's
`
`standing to enforce the patent, and that
`
`''[e]ven a motive solely
`
`and expressly to facilitate litigation ^is of no concern to the
`
`defendant
`
`and
`
`does
`
`not
`
`bear
`
`on
`
`the
`
`effectiveness
`
`of
`
`the
`
`assignment'")
`
`(internal citation omitted); AMP
`
`Inc.
`
`v. United
`
`States,
`
`389 F.2d 448,
`
`451
`
`(Ct. Cl.
`
`1968)
`
`(holding that motive
`
`for patent acquisition has no weight as
`
`to the legal
`
`issue of
`
`implied license);
`
`see also McNeil-PPC,
`
`Inc. v. L. Perriqo Co.,
`
`337 F.3d 1362, 1373 (Fed. Cir. 2003)
`
`(finding that ^'motives
`
`for
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 9 of 10 PageID# 42912
`
`making and attempting to patent new inventions of lesser medical
`
`value" are irrelevant); Rite-Hite Corp. v. Kelley Co.,
`
`56 F.3d
`
`1538, 1548 (Fed. Cir. 1995)
`
`(''The motive, or motivation,
`
`for the
`
`infringement
`
`is irrelevant if it is proved that
`
`the infringement
`
`in fact caused the loss."). The
`
`thrust of
`
`these cases
`
`is that
`
`the parties'
`
`intentions are generally irrelevant: what matters
`
`is whether
`
`the patent was actually infringed or
`
`is actually
`
`invalid.
`
`Thus,
`
`as
`
`in non-patent
`
`law, motive
`
`for bringing suit
`
`is
`
`irrelevant
`
`to the trial of
`
`a patent
`
`infringement suit,
`
`absent
`
`circumstances not present here. Fed. R. Evid. 402. Moreover, as
`
`is true generally, motive evidence can be quite a complicated
`
`topic. Therefore,
`
`admitting motive evidence would of necessity
`
`open the door
`
`to countervailing evidence that would necessarily
`
`detract
`
`from the real
`
`issues,
`
`that would cause delay and waste
`
`of time,
`
`and that would confuse the jury. All of that would be
`
`unfairly
`
`prejudicial
`
`and would
`
`substantially
`
`outweigh
`
`any
`
`marginal
`
`relevance of
`
`the motive evidence offered here. Fed. R.
`
`403.
`
`
`
`Case 3:14-cv-00757-REP-DJN Document 822 Filed 02/24/16 Page 10 of 10 PageID# 42913
`
`CONCLUSION
`
`For
`
`the
`
`reasons
`
`stated above,
`
`Samsung's oral motion to
`
`exclude motive evidence was sustained and a
`
`limiting instruction
`
`was given.
`
`I t is so ORDERED.
`
`/s/
`
`Robert E. Payne
`Senior United States District Judge
`
`Richmond, Virginia
`Date:
`February Z-T, 2016
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