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January 07, 2013

Remanded 'Rambus' Returns to Dismissal Sanction

Shred_me400The hangover from Rambus "shredding party" in the the late 1990s continues for the manufacturer and patentee of dynamic random access memory (DRAM) chips in the U.S. District Court for the District of Delaware.

As reported by Jan Wolfe in Law Technology News' sibling publication The Am Law Litigation Daily, Judge Sue Robinson "tossed a patent case Rambus brought against Micron Technologies Inc. more than a decade ago, concluding that the company deliberately destroyed evidence ahead of its litigation campaign." Mark this as a flashback for Rambus: as Wolfe notes, Robinson four years earlier made the same ruling, reversed by the Federal Circuit in 2011 finding further explanation was warranted due to the severity of the sanction.

Rambus sued Micron for patent infringement of its technology to speed computer memory as a counterclaim to a suit filed by Micron August 28, 2000, seeking decalaratory judgment for non-infringement on the grounds that Rambus' patents were unenforceable and invalid. According to the opinion, Micron's suit was filed in reaction to an email from Rambus CEO Geoff Tate to Micron chief Steve Appleton threatening litigation.

Robinson argues that Rambus destruction of evidence constitutes bad-faith spoliation and prejudices Micron's case to the extent that dispositive sanctions rendering Rambus' patents unenforceable are the appropriate remedy — and will act as a deterrent to similar misconduct. Robinson finds that although Rambus did institute a document retention policy, which included three "shred days" in 1998, 1999, and 2000, it was "selective" to seek an advantage in litigation. Examples that indicate bad-faith spoliation include:

• after ordering the destruction of 1,270 backup tapes, one was saved that could establish the date of conception of a Rambus invention;

• in a presentation on the company's "Document Destruction/Document Retention" policy, Joel Karp, VP of Intellectual Property, had written on several slides "LOOK FOR THINGS TO KEEP";

• although the court found that Rambus' duty to preserve arose in December 1998 when Micron was identified as a potential target of litigation, making litigation "reasonably forseeable," two "shred days" occured after December;

• drafts of Quarter 3 goals identify a "1999 shredding party at Rambus" beneath the heading "Licensing/Litigation Readiness" — changed to "a document retention compliance event" under "Database Maintenance" on the advice of outside counsel.

Whether the judge's decision holds that "Any lesser sanction would, in effect, reward Rambus for the gamble it took by spoliating and tempt others to do the same," organizations implementing document retention policies as part of general litigation readiness may prefer to forgo the phrase "shred day" for the safer "defensible deletion day."

Image by CarbonNYC

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