Put yourself into the position of the judge in the Qualcomm legal action with Broadcom which is lost, who is trying to decide what sanctions to bring against either 19 of Qualcomm’s lawyers and their employers or the company itself.
The lawyers either knew about, but decided not to produce a number of crucial emails and around 200,000 pages of documents in the Broadcom trial, or they never new about them or were prevented from sharing them, as they were legally bound to, with the Broadcom camp and the court.
If the lawyers were simply trying to pull the wool over the court’s eyes without instruction from their client, then it’s a minor issue as far as we’re concerned and will have no bearing on the forces shaping digital media marketplaces. But if on the other hand the Judge decides that Qualcomm was the culprit, then this could have a bearing on the way in which other judges in other cases treat Qualcomm’s evidence, resulting in a huge negative impact on the company in its wars with Nokia and others over its much vaunted intellectual property mountain.
The problem is that much of what would help the judge decide is protected under client attorney privilege, and so the lawyers are unable to testify even to defend themselves.
Effectively this silence is Qualcomm’s way of trying to pass the blame for what the case judge called ‘gross misconduct on a massive scale’ onto its legal team. It is the job of US Judge Barbara Major to decide whether to blame either one, neither or both and she is currently deliberating the outcome and may announce it any day.
Our guess is that it is Qualcomm that will take the fall here and get itself fined, and coincidentally it has just been let off half of the penalty from the original case because damages were doubled, and the criteria for damages doubling has just been shifted due to another case in front of an appeal court. So the $39.3 million award will now fall back to $19.6 million. The criteria used to be simply that the act was deliberate, but this has now been altered subtly in another, unrelated case.
Qualcomm has said all along that the omission of the evidence was an unintentional mistake but still will not release its two law firms from client privilege to discuss it. The assumption of the judge might be that there was a clear chain of command leading to Qualcomm that denied the court access to these documents, and it is likely that this will have been evident based on just what’s in them. If it was damning evidence then the Judge might conclude that it was deliberate on Qualcomm’s part.
Given that the entire case hinged on the idea, now proven, that Qualcomm withheld information on patents it had applied for from the H.264 compression standards body, in a deliberate attempt to hold the mobile industry to ransom over royalties, it seems that hiding evidence from the discovery process might be considered too advantageous to have been unintentional.
Already Qualcomm has had to pay the full legal costs of Broadcom, a move which is quite unusually in US cases compared to other countries, and if there are further penalties incurred due to the manner of its defense, then Qualcomm may have to re-evaluate how much money it has put aside for all of its ensuing legislation. There is also the matter of whether or not a top legal firm will now take on a Qualcomm case, unless it has some waiver in client attorney privilege agreed ahead of time, or the full support of senior management to put what evidence it must on the table. Either way Qualcomm is going to have to play its remaining litigation issues straight.