Appeals Court Throws Out Rambus Patent Ruling

angry tapir writes "A US appeals court has ruled on two patent lawsuits that pit Rambus against two competing DRAM makers, sending both cases back to district courts for reconsideration. The US Court of Appeals for the Federal Circuit vacated a lower court ruling requiring Hynix Semiconductor to pay Rambus damages and fees totaling US$397 million for the use of its patents in DRAM chips." Here's the issued opinion (PDF) in Hynix v. Rambus. The opinion in the other case (PDF), pitting Rambus against Micron, contains this juicy snippet: "On August 26, 1999, Rambus held the 'shredding party' it had planned as part of its third-quarter intellectual property litigation readiness goals. Rambus destroyed between 9,000 and 18,000 pounds of documents in 300 boxes."

Comments

Good

[jheath314]

Senior Judge Ronald Whyte's ruling in the Hynix case was bizarre anyway... I'm glad it got overturned. (He had concluded that Rambus wasnâ(TM)t anticipating litigation when the shredding took place.) Under Whyte's ruling the bar for being convicted as a spoilator of evidence was set impossibly high.

Re:Good

[icebike]

Wait, so the penultimate ruling (the one before this one) was in favor of Rambus?

Also, I thought the courts were supposed to view a party as guilty by default if they destroy evidence.

Yes to your question.

No to your destruction statement. They are not "Guilty" by default unless they were required to retain the
documents. Rambus would be required to retain these documents and the 1200+ email backup tapes
if they were planning litigation, or where a reasonable person could forsee litigation.
Since they were clearly planning litigation as early as 1998, they can't come along in 2006
and say that litigation was unanticipated.

Still, you have to wonder why this company was in such a rush to flush.

Re:Good

[Rich0]

Well, it was around that time when my own company started pushing more on records retention. Probably one of those general management trends of the day - probably some companies got creamed in discovery (consider that this wasn't long after the whole Microsoft email fiasco).

Love all the conflicting management recommendations that this led to. Legal would send out emails like "meet in person, rather than using email" and finance would send out "use electronic tools like email instead of having expensive in-person meetings."

I think the way it ended up shaking out is that most bottom-line employees use email, and most high-level managers that make the kinds of decisions that get companies sued tend to do it all in meetings without minutes.

Legally it is best for a company to have a policy and stick to it - what gets you in trouble is when one division shreds on a perfect schedule, and another doesn't. Then if the first gets sued the second gets used as an example to suggest that the first was planning something nefarious. That may or may not be true.

I almost wonder if this is something that should be the subject of government guidelines. I know that in many industries particular types of documentation have a retention schedule mandated by law (almost always short compared to most litigation). When you think about technology - is there really any reason to ever throw out a document? You could probably build a machine that sits next to a photocopier and which coverts a document to PDF, does OCR, uploads it to a server, and then dumps into a shredder. The server could then do deduplication and index everything (where it originated, where it was tossed, etc). Your document management system would send clean electronic PDFs to the same server, so in the ideal case where the document was printed and then tossed the scanned version never gets retained unless it has writing on it.

Re:Good

[nomadic]

Outside counsel should be disbarred for what was described in the Micron v. Rambus opinion.

Re:As Caruso would say...

[Alex Belits]

This brings up some...

bad memory.

YEEEAAAHHHHH!

Re:Still going?

[cdrudge]

I can count 397m ways why it still counts. While the technology may gave moved on, the effects of the lawsuit are still around.

Re:The real reason for all the litigation

[Sun]

This case is about hardware patents, not software ones. The economics controlling those are difference.

For one thing, the costs of producing chips is so high, that if you can afford those, you can afford to go to court over patents. The main problem with software patents is that it costs your own time for so many months in your mom's basement (which amounts to about $70K if you count lost wages, less if you just count the food and lodging you consume) to produce a decent, market worthy software product. Compare that with the ~$5 million it costs to defend against a patent suite, and you see how that is a problem. It costs $1 million just to create a tape-out for ASIC production, which is just one part of the production chain, and does not include the development and testing costs.

This particular case is not about "dummy" patents. It is about a party signing RAND and participating in a committee that develops new technology, while at the same time discreetly patenting that very same technology. This is a simple case of misdirection and theft. The patents in this case are just the tool with which this misdirection took place.

Shachar

Good

[Trogre]

Anything that shuts down those litigious Rambus bastards is likely a positive move.

Does it even matter anymore?

[overshoot]

If you had ever done any standards work in the past ten years, you wouldn't have to ask.

And, yes, I speak from painful experience -- I worked on the JEDEC committees that Rambus abused.

Re:The real reason for all the litigation

[Sun]

This is the fantasy, of course.

Someone should let Sergei Brin, Bill Gates, Gil Schwed and not so few others that. They all started with miniscule software companies paying their initial employees mostly with equity, while these companies are, today, worth billions.

But how many real - marketable - patentable - software products come straight out of Mom's basement?

That is the wrong question for this thread. The right question is how many real, marketable software products that come from Mom's basement (or equivalent funding strain on the individual) are in danger of never making it due to inability to protect themselves from junk patents held by trolls. This thread isn't about the chances of the "mom's basement" business model producing products (which is indisputably low). This is about the ratio between the amount of equity required to form a software company and the amount needed to defend against patent trolls.

Shachar