On April 2, 2010, United States Magistrate Judge Barbara Major issued a decision which may end a two-year discovery battle about whether sanctions should be imposed on six attorneys in Qualcomm v. Broadcom, Case No. 05cv1958-B (BLM), 2010 WL 1336937 (S.D. Ca. April 2, 2010).
Kevin Brady, a Delaware litigator and nationally-recognized electronic discovery expert, prepared this synopsis.
Judge Major found that there was insufficient proof that the six attorneys who were responding to the January 7, 2008 Order granting in part Broadcom Corporation’s motion for sanctions (the “Responding Attorneys”) acted in bad faith. As a result, the Court dissolved the order to show cause that initiated the proceedings in January 2008.
While Judge Major found that “Qualcomm improperly withheld from Broadcom tens of thousands of documents that contradicted one of its key legal arguments” and that there were “significant errors” by some of the attorneys, that was not enough to warrant sanctions, and proof of “bad faith” was missing. The Court stated:
There still is no doubt in this Court’s mind that this massive discovery failure resulted from significant mistakes, oversights, and miscommunication on the part of both outside counsel and Qualcomm employees. The new facts and evidence presented to this Court during the remand proceedings revealed ineffective and problematic interactions between Qualcomm employees and most of the Responding Attorneys during the pretrial litigation, including the commission of a number of critical errors. However, it also revealed that the Responding Attorneys made significant efforts to comply with their discovery obligations. After considering all of the new facts, the Court declines to sanction any of the Responding Attorneys.
Court Finds Problems With Communication and Candor
While the Court elected not to summarize the facts in its 12-page decision, it did identify the following errors as the reasons for the document debacle during and after trial:
1) the lack of meaningful communications between and among Qualcomm’s engineers, its in-house legal staff, and outside legal counsel;
2) the failure of Qualcomm’s counsel to meet in person with the appropriate Qualcomm engineers at the beginning of the case to discuss document collection;
3) the failure of outside counsel to obtain sufficient information and understand Qualcomm’s information systems; and
4) the failure to properly supervise the collection of relevant information especially electronic information.
The Court also found “an incredible lack of candor on the part of the principal Qualcomm employees who had relevant information but did not disclose it to Qualcomm’s lawyers. The Court noted that there were also problems of inadequate follow-up in response to “contradictory, or potentially contradictory evidence.”
No Sanctions Under Federal Rules or Court’s Inherent Power
Citing Fed. R. Civ. P. 26, the Court found that “[w]hile some of the interrogatory responses were not accurate and the document productions were not complete, after considering all of the evidence presented to the Court during the remand proceedings … the Court finds that his discovery responses were made after a reasonable, although flawed, inquiry and were not without substantial justification.”
As a result, the Court declined to order sanctions under the Federal Rules of Civil Procedure. The Court also noted that while it has “inherent power” to issue sanctions upon a finding that the attorney acted in bad faith:
. . . the evidence presented during these proceedings clarified that, although a number of poor decisions were made, the involved attorneys did not act in bad faith. While [two of the Responding Attorneys] did not pursue several discovery paths that seem obvious, at least in hindsight, they did make repeated efforts to verify that Qualcomm’s discovery responses were accurate.
SUPPLEMENT: An interview with one of the attorneys involved in this case was posted today here on the blog called Above The Law.