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Apple accuses Samsung of destroying evidence in patent suit

post #1 of 24
Thread Starter 
Apple has alleged that Samsung intentionally destroyed e-mail evidence relating to its ongoing patent infringement suit.

The claim was revealed in a motion filed by Apple earlier this month in the Northern District of California. As revealed by Network World, Apple has asked the judge to instruct the jury that Samsung had a duty to preserve evidence relevant to the ongoing case, yet failed to do so.

Apple's filing asserts that Samsung destroyed "vast quantities of relevant evidence in blatant disregard of its duty to preserve all such evidence."

At issue is Samsung's company policy of automatically deleting e-mails from custodian computers every two weeks, even if the company is required to keep e-mail evidence relevant to an ongoing case.

"Samsung's ad hoc, unmonitored email "preservation" methods have resulted in the irretrievable loss of unknown volumes of relevant e-mails," Apple wrote.

In the filing, Apple cited an e-mail from the head of Samsung's product strategy team, Won Pyo Hong, in which "side-by-side comparisons of Apple and Samsung products" were ordered for design presentations.



"Apple and the Court cannot possibly know how many more emails Dr. Hong sent or received that would have supported Apple's claims that Samsung copied Apple products had they not been deleted," the filing reads. "The same is true for many of the other Samsung witnesses who only produced a handful of emails, or none at all."

In the same case, Apple has also accused Samsung of failing to produce source code relevant to the trial. United States District Court Magistrate Judge Paul S. Grewal sided with Apple and penalized Samsung for refusing to provide evidence in a timely fashion.

And in April, Grewal also found Samsung in violation of a court order requiring the company to produce documents mentioning Apple's products. In that order, Grewal also imposed monetary sanctions on Samsung.

The accusations leveled by Apple come just as the company's chief executive, Tim Cook, is set to meet with Samsung CEO Gee-Sung Choi on May 21 and 22 in San Francisco, Calif. The court-moderated settlement talks were ordered by Judge Lucy Koh in an effort to resolve the legal dispute between the two companies, which now includes 50 lawsuits across 10 countries.

The legal battle began in April of 2011, when Apple sued Samsung for allegedly copying the look and feel of the iPhone and iPad. Samsung has shot back with its own patent infringement complaints against Apple, though it has not found any success in such litigation thus far, while Apple has managed to win some temporary injunctions on certain Samsung products.
post #2 of 24
"At issue is Samsung's company policy of automatically deleting e-mails from custodian computers every two weeks, even if the company is required to keep e-mail evidence relevant to an ongoing case."
 
Emails are purged every two weeks? I work at a large software company and our best friend is leaving an email paper trail to cover our ass in projects in the event of a "this isn't what I requested" dispute from a producer or another team.
post #3 of 24

I have heard it is a good idea for businesses to keep email's stored along the same lines as you would all other archived documents. At least 2 years is a safe bet but 2 weeks is ridiculous. Given the circumstances that looks very suspicious to me. 

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post #4 of 24

We keep a rolling 5 years of archived emails for our customers and have 10+ years for our legal customers.  These customers are miniscule compared to Apple and Samsung.

post #5 of 24
Quote:
Originally Posted by AppleInsider View Post
At issue is Samsung's company policy of automatically deleting e-mails from custodian computers every two weeks, even if the company is required to keep e-mail evidence relevant to an ongoing case.


Isn't this illegal on the face of it? They're a public company. Even if they weren't, they should be legally required to keep all e-mail.

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post #6 of 24
Quote:
Originally Posted by Tallest Skil View Post


Isn't this illegal on the face of it? They're a public company. Even if they weren't, they should be legally required to keep all e-mail.

 

Maybe they should switch to gmail.

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post #7 of 24
Quote:
Originally Posted by jeffreytgilbert View Post
Maybe they should switch to gmail.

 

Just do all corporate business through Facebook. They NEVER delete anyone's stuff, even after they've been told to. lol.gif

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post #8 of 24

And Judge Koh recently filed a decision that grants Apple the right to re-file any and all patent infringement complaints that were dropped from the two current cases against Samsung.  At any time in the future.  She didn't grant Samsung the same right.  So Apple can and will sue Samsung in the future.

 

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post #9 of 24

Samsung has obviously learned from Microsoft, and recently Google, that damning internal emails can come back to bite you on the backside.
 

The emails are probably backed up somewhere for Cover-Your-Butt purposes but good luck finding them.

post #10 of 24

Do people and practices in South Korea have a 'duty' to accommodate a court half way around the globe in Northern California with no jurisdiction over them? I would be curious to know what requirements US law imposes upon foreign corporations when selling their products here.

post #11 of 24
Quote:
Originally Posted by Tallest Skil View Post


Isn't this illegal on the face of it? They're a public company. Even if they weren't, they should be legally required to keep all e-mail.

I doubt it is illegal.  Whenever my company is involved in a lawsuit, we just get an company-wide email informing employees to not deliberately delete any emails that might be pertinent to the lawsuit.

post #12 of 24
Quote:
Originally Posted by SockRolid View Post

And Judge Koh recently filed a decision that grants Apple the right to re-file any and all patent infringement complaints that were dropped from the two current cases against Samsung.  At any time in the future.  She didn't grant Samsung the same right.  So Apple can and will sue Samsung in the future.


EFF YES. I like the sound of that.

 

Quote:
Originally Posted by Negafox View Post
I doubt it is illegal.  Whenever my company is involved in a lawsuit, we just get an company-wide email informing employees to not deliberately delete any emails that might be pertinent to the lawsuit.

 

To me that sounds like code for, "We're in a lawsuit; now's the time to go through and delete all e-mails relevant to this suit." If the e-mails were needed for a case, they should be not only the FIRST things picked up by the court, they should be retrieved silently.

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post #13 of 24
Quote:
Originally Posted by e_veritas View Post

Do people and practices in South Korea have a 'duty' to accommodate a court half way around the globe in Northern California with no jurisdiction over them? I would be curious to know what requirements US law imposes upon foreign corporations when selling their products here.

Yes, they do, as they have businesses and employees here in the US. If Samsung were to non-comply with a federal mandate, the US could theoretically ban all Samsung devices, freeze company assets and prevent them from conducting business within the US and its territories, and I am willing to bet they could pressure Canada and certain European companies to do the same.
Not saying this would ever happen, but it isn't out of the rhelm of the possible. I would never want to see this happen though. I like my Samsung Skyrocket, soon to be S3, and my 8.9 Tab too much.
post #14 of 24
Quote:
Originally Posted by Tallest Skil View Post


Isn't this illegal on the face of it? They're a public company. Even if they weren't, they should be legally required to keep all e-mail.

Various laws require retention periods for certain departments and communication so these emails coud be exempt. HOWEVER, if that policy changed after the complaints started then the whole 'even if it could relate to a lawsuit' part could get them zinged. Because it will read like they purposefully destroyed those items and why do that unless they are totally guilty of intentionally trying to copy Apple instead of the accident Samsung is claiming it was

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post #15 of 24
Quote:
Originally Posted by e_veritas View Post

Do people and practices in South Korea have a 'duty' to accommodate a court half way around the globe in Northern California with no jurisdiction over them? I would be curious to know what requirements US law imposes upon foreign corporations when selling their products here.

 

Perhaps Samsung should reconsider doing business in the United States, if they don't want to be obligated to obey US law or allow US courts to have jurisdiction over them..

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post #16 of 24
Quote:
Originally Posted by Tallest Skil View Post


Isn't this illegal on the face of it? They're a public company. Even if they weren't, they should be legally required to keep all e-mail.
The two-week deletion period, in and of itself, is not out of the ordinary. Imagine the retention costs on a company that size! The issue, as you have surmised, is automatic deletion in the face of a duty to preserve evidence. There is no ambiguity that Samsung was required to preserve relevant e-mails, even if that required suspending the automatic deletion process. What Samsung may argue is that it did not reasonably know/believe that it was required to keep the e-mails of some particular custodians, or that it tried but failed, or any number of things (I haven’t read its opposition in the ITC matter). This will require investigation and maybe experts, reasons Samsung requested more time according to the article. Who knows what the truth is, but the judge will sort it out.
Quote:
Originally Posted by e_veritas View Post

Do people and practices in South Korea have a 'duty' to accommodate a court half way around the globe in Northern California with no jurisdiction over them? I would be curious to know what requirements US law imposes upon foreign corporations when selling their products here.
The California federal court has established jurisdiction over the Samsung entities involved (or else they wouldn’t still be in the case). Also, if Samsung filed counterclaims, then it availed itself of the court's jurisdiction.
post #17 of 24
Quote:
Originally Posted by hill60 View Post

 

Perhaps Samsung should reconsider doing business in the United States, if they don't want to be obligated to obey US law or allow US courts to have jurisdiction over them..

Much like any multi-national company including Apple. 

post #18 of 24
Quote:
Originally Posted by SockRolid View Post

And Judge Koh recently filed a decision that grants Apple the right to re-file any and all patent infringement complaints that were dropped from the two current cases against Samsung.  At any time in the future.  She didn't grant Samsung the same right.  So Apple can and will sue Samsung in the future.

 

Great time to be a Korean arsonist.  Bad time to be a Korean offsite backup provider.

 

Actually what happened was that when both Samsung and Apple voluntarily dropped claims when Judge Koh told them the amount both had claim would amount to "cruel and unusual punishment" for jurors, Samsung's lawyers took the chance and filed a request that the claims that Apple dropped be dismissed with prejudice. Apple never made such a request on Samsung's claims, Samsung retains their rights to re-file if they want in the future.  Had Apple file the same request against Samsung I'm guessing she would've done the same. My guess based on her decisions is that she would rather have as many claims as possible by either parties decided by a jury rather than by her and/or have those claims come up in someone elses court not hers.

post #19 of 24
Quote:
Originally Posted by e_veritas View Post

Do people and practices in South Korea have a 'duty' to accommodate a court half way around the globe in Northern California with no jurisdiction over them? I would be curious to know what requirements US law imposes upon foreign corporations when selling their products here.
No. Unless they want to sell their products there.

Samsung can very well choose to ignore US law, but then they should also be prepared to withdraw their products from US markets.
post #20 of 24
Quote:
Originally Posted by Law Talkin' Guy View Post

The two-week deletion period, in and of itself, is not out of the ordinary. Imagine the retention costs on a company that size! The issue, as you have surmised, is automatic deletion in the face of a duty to preserve evidence. There is no ambiguity that Samsung was required to preserve relevant e-mails, even if that required suspending the automatic deletion process. What Samsung may argue is that it did not reasonably know/believe that it was required to keep the e-mails of some particular custodians, or that it tried but failed, or any number of things (I haven’t read its opposition in the ITC matter). This will require investigation and maybe experts, reasons Samsung requested more time according to the article. Who knows what the truth is, but the judge will sort it out.
The California federal court has established jurisdiction over the Samsung entities involved (or else they wouldn’t still be in the case). Also, if Samsung filed counterclaims, then it availed itself of the court's jurisdiction.

 

Sarbanes-Oxley requires a minimum 5 year retention policy for all company data that may have any relation to financial performance and customer interactions, for all companies that do business in the United States.  Note that isn't "based" in the United States.  Email immediately falls under this, typically all of it since it would be considered too difficult to filter which is and is not required.  If a two week arbitrary email deletion policy is true Samsung just set themselves up for a major sanction from the SEC.  Failure to comply with the law may also add to what the judge can use to determine if Samsung is in contempt for destroying evidence should the judge determine that they actually did.

 

As far as volume storage costs, that's the cost of doing business.  There are companies that store just as much as Samsung would need to and they comply with the SOX act, so there is no excuse it the actually are out of compliance.

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post #21 of 24
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post #22 of 24
Quote:
Originally Posted by Hiro View Post

 

Sarbanes-Oxley requires a minimum 5 year retention policy for all company data that may have any relation to financial performance and customer interactions, for all companies that do business in the United States.  Note that isn't "based" in the United States.  Email immediately falls under this, typically all of it since it would be considered too difficult to filter which is and is not required.  If a two week arbitrary email deletion policy is true Samsung just set themselves up for a major sanction from the SEC.  Failure to comply with the law may also add to what the judge can use to determine if Samsung is in contempt for destroying evidence should the judge determine that they actually did.

 

As far as volume storage costs, that's the cost of doing business.  There are companies that store just as much as Samsung would need to and they comply with the SOX act, so there is no excuse it the actually are out of compliance.

Is Samsung a Level 3 ADR in the US? Only those would be expected to. Even then, the jurisdiction of S-Ox over foreign companies is still a bit up in the air (although many of them voluntarily submit to its key guidelines).

post #23 of 24
Quote:
Originally Posted by Negafox View Post

"At issue is Samsung's company policy of automatically deleting e-mails from custodian computers every two weeks, even if the company is required to keep e-mail evidence relevant to an ongoing case."
 
Emails are purged every two weeks? I work at a large software company and our best friend is leaving an email paper trail to cover our ass in projects in the event of a "this isn't what I requested" dispute from a producer or another team.

Yes, a 2 week purge process is ridiculous. It's something like 5 years for relevant documents for Sarb-Ox and every company I've ever dealt with retained documents for YEARS, not weeks.

Heck, if I had to delete documents after 2 weeks, nothing would ever get done. It often takes much longer than that to simply get a response to something I send out.

Quote:
Originally Posted by e_veritas View Post

Do people and practices in South Korea have a 'duty' to accommodate a court half way around the globe in Northern California with no jurisdiction over them? I would be curious to know what requirements US law imposes upon foreign corporations when selling their products here.

Wrong about 'no jurisdiction'. The US courts do have jurisdiction. By having offices and employees in the US, Samsung is bound by US law with respect to those offices and employees. This entire lawsuit is based on the fact that Samsung sells their products in the U.S. and is therefore bound by US law wrt to selling those products. If it wasn't so, a foreign country could do whatever they want in the US, including anything that is blatantly unsafe or illegal.

Furthermore, a claim of 'no jurisdiction' needs to be the first thing filed. If you are sued by a court which you believe doesn't have jurisdiction, you immediately respond by telling the court that it doesn't have jurisdiction and why. The court needs to settle the jurisdictional issue first. If you file a response to the motion, you are agreeing to the court having jurisdiction. So by filing responses, Samsung agreed to jurisdiction.

Quote:
Originally Posted by Law Talkin' Guy View Post

The two-week deletion period, in and of itself, is not out of the ordinary. Imagine the retention costs on a company that size! The issue, as you have surmised, is automatic deletion in the face of a duty to preserve evidence. There is no ambiguity that Samsung was required to preserve relevant e-mails, even if that required suspending the automatic deletion process. What Samsung may argue is that it did not reasonably know/believe that it was required to keep the e-mails of some particular custodians, or that it tried but failed, or any number of things (I haven’t read its opposition in the ITC matter). This will require investigation and maybe experts, reasons Samsung requested more time according to the article. Who knows what the truth is, but the judge will sort it out.
The California federal court has established jurisdiction over the Samsung entities involved (or else they wouldn’t still be in the case). Also, if Samsung filed counterclaims, then it availed itself of the court's jurisdiction.

I disagree with the bolded. I've worked for a number of companies and record retention is always in the years, not weeks, when the company bothers to spell it out. A 2 week retention policy is absurd on many levels. As stated above, it would be impossible to do business with that short of a records retention policy.
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post #24 of 24
Quote:
Originally Posted by anantksundaram View Post

Is Samsung a Level 3 ADR in the US? Only those would be expected to. Even then, the jurisdiction of S-Ox over foreign companies is still a bit up in the air (although many of them voluntarily submit to its key guidelines).

Leve 2 and 3 are required to comply with SOX. Samsung has a NASDAQ quote, that means they are at least level 2.  They also have some individual Korean divisions with rule 114A ADRs, I guess that may make for a tangled web of convenience.

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