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2. Steinberg Was Not a Credible Witness.

227. Steinberg's prior testimony established that his job responsibilities as outside

counsel for Rambus in 1998 included preparing for litigation involving the assertion of Rambus's

patents against SDRAM and DDR SDRAM products, and that the scope of his duties once he

joined Rambus as in-house counsel included "handling-we were preparing for litigation," and

that he continued preparing for litigation once he became Rambus's vice-president of intellectual

property. N. Steinberg Jan. 16,2001 Infineon Dep. Tr. 96-97, 102, 104 (video clip 113 played at

Hynix Trial Tr. 1448); see also J. Karp Infineon Dep. Tr. 39:18-40:19 (Jan. 8, 2001) (played at

Hynix Trial Tr. 164) (explaining that Steinberg's responsibilities at Rambus included litigation).

228. In 2001, Steinberg testified that his responsibilities for Rambus were "licensing

and preparation for litigation, and, of course, prosecution. . . related to Rambus technology andRambus patents." N. Steinberg Jan. 16,2001 Infineon Dep. Tr. 96-97 (emphasis added) (played

at Hynix Trial Tr. 1445-46). According to Steinberg, the "licensing and preparation for litigation"

to which he referred was related to Rambus's patents that were thought to relate to third parties

who used RDRAMs and third parties who used SDRAMs and DDR-SDRAMs. Id.

229. After the attorney-client and work-product privileges were pierced, and documents

were produced disclosing the nature and extent of Rambus's document destruction, Steinberg

changed his testimony and insisted that there was no anticipated litigation until almost

immediately before Rambus sued Hitachi in January 2000, and that there was no anticipation of

litigation after the Hitachi litigation settled on June 23, 2000 until almost immediately before

Rambus initiated the action against Infineon on August 8,2000. See, e.g., N. Steinberg Infneon

Dep. Tr. 293-94 (Oct. 6, 2004) (video clip 113, played at Hynix Trial Tr. 1447:16-1448:18);

Hynix Trial Tr. 1475.

230. When confronted with his earlier statements in a 2004 deposition, Steinberg

testified, with an apparent angry demeanor, that "I don't know how you're spinning these

documents or how the Court is spinning them, but I'm tellng you we did not contemplate

litigation." N. Steinberg Infneon Dep. Tr. 293-94 (Oct. 6,2004) (video clip 113, played at Hynix

Trial Tr. 1447:16-1448:18).

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1 231. 'Steinberg's candid testimony inn 2001 that he was involved in litigation planing

2 is in direct conflict with the subsequent testimony that Steinberg gave after the attorney-client

3 privilege was pierced and documents demonstrating Rambus's document destruction were

4 revealed. Steinberg retracted his statements regarding preparing litigation after the Infineon5 piercing orders revealed Rambus's shred days and he realized that he needed to move Rambus's

6 anticipation of litigation to a point much later in time.

7 232. Steinberg's January 2001 testimony is also clearly inconsistent with his testimony

8 in the Hynix unclean-hands trial that he first took steps to prepare for possible litigation on behalf

9 of Ram bus against DRAM manufacturers was in "middle of December-ish, '99." Hynix Trial Tr.

10 1475.

11 233. This conflict in his testimony before and after the attorney-client privileges were

12 pierced and the documents respecting spoliation were uncovered makes clear that Steinberg is not

13 a credible witness and that his altered testimony on this point should be disregarded.

14 234. Steinberg is also demonstrated to not be credible for a separate independent

15 reason: his violation of his ethical duties as an attorney in secretly performing unauthorized legal

16 services for Rambus while he was stil employed by Samsung as in-house legal counseL.

17 235. The fact that Steinberg was engaged by Rambus to provide legal services while he

18 was still employed by Samsung as in-house counsel is undisputed. Hynix Trial Tr. 1442-44.

19 Steinberg was employed by Samsung through August 7, 1998, and publicly began as outside

20 counsel for Rambus upon leaving Samsung. Id.

21 236. Samsung and Rambus's interests were undeniably adverse for purposes of a

22 conflict-of-interest assessment. See, e.g., Rambus Inc. v. Samsung Elecs. Co., Ltd., Nos. C-05-

23 02298 RMW, C-05-00334 RMW, 2007 WL 39374, at *5 (N.D. CaL. Jan. 4, 2007) (noting that

24 "(tJwo paries to a license agreement could reasonably be considered 'adverse parties' in the

25 context of legal representation"). In addition, there is no dispute that the dual representation was

26 not authorized by Samsung.

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1 237. Steinberg's unauthorized dual employment was a violation of his ethical duties as

3

2 an attorney, and the credibility of his testimony should be discounted for that reason as well.

238. Lastly, despite the central role of Steinberg's testimony to Rambus's arguments,

4 Rambus declined to bring Steinberg to testify in this case, notwithstanding that he was disclosed

5 to Samsung as a witness, and that he was available to testify on Thursday, September 25, 2008.

6 Sept. 22nd Trial Tr. 1087. That decision by Rambus should also be considered in assessing the

7 reliability of Steinberg's testimony.

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239. Indeed, considering the same testimony, Judge Payne of the Eastern District of

Virginia reviewed the conflcting testimony and found that Steinberg was not telling the truth

when he testified that (1) Rambus did not anticipate litigation until immediately before it sued

Hitachi, and (2) that Rambus did not anticipate litigation after it settled with Hitachi until right

before it sued Infineon:

After the attorney-client and work product privileges were pierced, anddocuments were produced disclosing the nature and extent of Rambus' documentdestruction, Steinberg changed his testimony and insisted that there was noanticipated litigation until almost immediately before Rambus sued Hitachi inJanuary 2000 and that there was no anticipation of litigation after the Hitachilitigation settled on June 23, 2000 until almost immediately before Rambusinitiated the action against Infineon on August 8, 2000. The Court believes thetestimony given by Steinberg ... in January 2001 before the attorney-clientprivileges were pierced and the documents respecting spoliation were uncovered.The Court does not believe, and thus rejects, the testimony of Steinberg given in... October 2004 in the Infineon action. .. wherein Steinberg asserts that litigationwas not anticipated until just before Rambus sued Hitachi and Infineon,respectively. As to the latter testimonies, the Court finds that Steinberg was nottellng the truth.

Samsung Elecs. Co., 439 F.Supp.2d at 549 n.20 (exhibit citations omitted).

3. Tate's Testimony Regarding Anticipation of Litigation Was NotCredible.

240. Tate's testimony was not credible. His statements in 2005 after litigation was

24 underway on multiple fronts that he would have been wiling to compromise on royalty rates is

25 not credible in light of the contemporaneous evidence. Tate had set the goal of demanding

26 royalties in excess of RDRAM from the time that Karp came on board, and this goal remained

28

27 constant. Hynix Trial Tr. 1360:11-18, 1399:9-14; HTX 094; HTX 006. Rambus offered no


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1 written evidence of a wilingness to accept anything less than a 5% running royalty for DDR

2 SDRAMs. And although acceptance of Rambus terms was a theoretical possibility, the evidence

3 supports the conclusion that Rambus believed that it was likely, even unavoidable, that its

4 demand for royalties on SDRAMs would lead to litigation. See, e.g., HTX 244.004; HTX 3955

6 Tate's self-interested testimony that Rambus was not

7 anticipating litigation beginning in 1998 should not be credited, paricularly given that his

8 contemporaneous notes undermine those assertions.

9 241. Tate is also not credible because he repeatedly denied any recollection of

10 significant events and could recall them only upon being confronted with documentar evidence.

11 For, example, he denied it was Rambus's goal in 1998 to get all infrngers to license their IP or

12 sue and denied that he hired Kar for that purpose. Hynix Trial Tr. 1247:3-1248:5; HTX 003. It

13 was not until he was shown his own e-mail describing Karp's role that he capitulated, "(iJfthat's

14 what it says in the document, assume you're reading from the document, so the document says

15 what it says." Id. at 1248:6-14. Likewise, Tate could not recall his one-on-one meetings with

16 Kar" even after being shown the entries in Karp's notebook recording the meetings, and denied

17 having instructed Karp to develop a licensing strategy to report to the board in March 1998.18 Hynix Trial Tr. 1259:10-21, 1268:18-24, 1269:17-24; HTX 395. Tate did not recall stating in a

19 January 1998 meeting with Cooley that Rambus wanted to go quickly and either get a license or

20 litigate. Only upon being shown a document recording the meeting did Tate concede some

21 recollection of the event, and very little at that. Hynix Trial Tr. 1260:24-1264:25, 1265:7-1266:4;

22 HTX395.

23 242. And during the recent trial on Samsung's MFL counterclaims, Tate could not

24 recall at what price stock warrants were issued to Samsung (a detail that is ilustrative of

25 Rambus's significant motivation in the Summer of2000 to sign a deal with Samsung), Sept. 22nd

26 Trial Tr. 745-47, or what internal discussions there may have been at the time of Rambus's

27 investor conference following the Hitachi settlement that would contradict Rambus's statements

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1 to investors regarding whether RDRAM or JEDEC-standardized SDR/DDR DRAM should be

2 Rambus's top licensing priority, id. at 745, or how it came to be in Rambus's SDR/DDR license

3 with Toshiba that Rambus's licensing of Samsung was identified as a trigger for certain royalty

4 provisions, id. at 766. Tate's inability to recall and wilingness to contradict details supported by5 the available contemporaneous documents that support Samsung's interpretation of Rambus's

6 MFL obligations by ilustrating the extent of Rambus's motivation to license Samsung in 2000

7 demonstrates that Tate is not a credible witness and that his self-serving testimony should be

8 disregarded.

9 243. In addition, Tate was previously determined to have given false sworn testimony,

10 and is not a credible witness. See Rambus, Inc. v. Infneon Techs. AG, 155 F.Supp.2d 668, 681-

11 82 (RD. Va. 2001), rev'd in part, vacated in part, 318 F.3d 108 (Fed. Cir. 2003). Judge Payne of

12 the Eastern Distrct of Virginia found that Tate gave objectively false testimony regarding his

13 direct role in Rambus's strategy to create a patent trap for the JEDEC SDRAM and DDR

14 SDRAM standard. See id. at 681 (E.D. Va. 2001) ("Rambus' Chief Executive Officer, Geoff

1 5 Tate, at his first deposition, testified that he did not believe that Rambus drafted claims to cover

16 JEDEC's standard-setting work (indeed, he stated that he did not know that it was possible to

17 amend patent claims), but, at trial he admitted, upon being prodded by reference t9 belatedly

18 obtained documents, that he knew that Rambus was amending its patent applications to cover the

19 JEDEC SDRAM standard."); Tr. of Mot. to Transfer Hearing, dated Aug. 23, 2005, Samsung

20 Elecs. Co., Ltd. v. Rambus, Inc., E.D. Va. Civil Action No. 3:05cv406, at 42:10-42:12 ("Mr. Tate

21 and Mr. Crisp have both been adjudicated in this court unappealed as having given false

22 testimony.") (attached as Ex. B to D. Powers Decl.).

234.

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Johnson's Testimony Regarding Whether Rambus Was AnticipatingLitigation Was Not Credible.

244. Johnson's testimony asserted that litigation was not in contemplation or seriously

considered by Rambus in the first quarter of 1998, or as of the time when the first wholesale

destruction of documents took place (September 1998). That testimony is not credible because it

is inconsistent with Rambus's contemporaneous business records and with Johnson's own biling

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1 records at Cooley Godward and Fenwick and West,

2

3 RTX 354 (handwritten notes from meetings with Kar reflecting litigation

4 planing and considerations); RTX 347; RTX 348.

5 245. Johnson's testimony is also inconsistent with that of Diane Savage, Johnson's then

6 law partner, who testified that Kar told her in 1998 that he needed "a litigator," and, for that

7 reason, she put him in contact with Johnson. Hynix Trial Tr. 579-80. Savage's testimony should

8 be credited over Johnson's not only because it is consistent with Rambus's business records, but

9 also because she had nothing at stake in the determination of whether or not Rambus anticipated

10 litigation when it implemented its document-retention policy. Unlike Johnson, who advised

11 Rambus that it could destroy documents until litigation begins, Savage had no interest in the

12 issues about which she testified because she was not involved in advising Rambus to adopt a

13 document-retention policy while at the same time counseling Rambus on the ins and outs of the

14 patent litigation it was planning against major DRAM manufacturers. RTX 345; RTX 347; RTX

15 348; Hynix Trial Tr. 1703-07.

16 246. For this reason it is perhaps unsurprising that Johnson's testimonial demeanor,

17 when addressing the issue of anticipation of litigation, was that of an advocate for Rambus, rather

18 than that of a professional who was disinterested in the outcome. See, e.g., Hynix Trial Tr.

19 1698:18-1699:10 (describing "horror stories" slide presented to Rambus employees in connection

20 with document-retention policy and testifying that he told Rambus that "the act of deleting

21 (emailsJ, when you are actively involved in litigation, can lead - can give rise to a claim (of

22 spoliationJ, and I was tryng to explain to the client that this was serious business") (emphasis

23 added); Id. at 1723:24-1724:15 (in response to question of whether Johnson viewed his

24 presentation at Rambus as a legal opinion that Rambus could destroy evidence relating to the

25 potential patent claims he had discussed with them, testifyng that "if the question is were they

26 free to dispose of documents after they finalized a decision to file a lawsuit, the answer is, no,

27 they were not free to do so") (emphasis added). His bias can likely be attributed to the fact that


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1 he was defending advice that he had given and undermines the credibility of his testimony,

2 especially because it is inconsistent with Rambus's contemporaneous business records and the

3 testimony of his former law partner.

4 247. Indeed, considering the same testimony, Judge Payne of the Eastern District of5 Virginia found that Johnson should not be believed with regard to: (1) his testimony that

6 Rambus's discussions with Cooley Godward in February 1998 and the presentation given to the

7 board in March 1998 were focused on licensing, rather than litigation; (2) his testimony

8 supporting the notion that in 1998, litigation was a distant prospect, which would only ensue in

9 the event that Rambus' licensing efforts were not successful; and (3) his assertions that litigation

10 was not even in contemplation or seriously considered in the first quarer of 1998 or as of

1 1 September 1998 when the first wholesale destruction of documents took place. Samsung Elecs.

12 Co., 439 F.Supp.2d at 556.

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248. Judge Payne reasoned that

Johnson's testimony is flatly at odds with that of Diane Savage, who at the timewas Johnson's law partner, and who the Court accepts as a credible witnessbecause her demeanor was convincing and she has nothing at issue in this dispute.Additionally, her testimony is consistent with Rambus' contemporaneousbusiness records and Cooley Godward's billing records. Savage testified thatKar told her that he needed 'litigation assistance,' and, for that reason, she puthim in contact with Johnson, a litigator. Licensing lawyers were involved in theearly meetings as well, but that is unremarkable given that Rambus' licensingstrategy was also under review. Karp's notes of the February 12 meeting, theLicensing and Litigation Strategy document which Karp and Johnson preparedtogether, and Karp's presentation to the board of directors refute the testimonygiven by Johnson and Kar that the focus of Rambus' efforts at this stage wasconfined to licensing and that litigation was merely an ephemeral possibility.

Id.

249. Judge Payne also rejected Johnson's testimony by reasoning that "(oJne does not

23 make oneself 'battle ready,' nor establish a discovery database, nor identifY potential venues, nor

24 identifY specific litigation targets, nor select experts, to address a vaguely anticipated litigation

25 potentiality. The efforts of Karp and Johnson to suggest that those terms mean something else

26 amount to nothing more than after-the-fact spin." Id.

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250. Judge Payne further reasoned that Johnson's testimony was strongly influenced by

a motivation to defend the advice that he had given to Rambus, and for that reason, should not be

credited:

Johnson's testimonial demeanor, when addressing the issue of anticipation oflitigation, was that of an advocate for Rambus, rather than that of a professionalwho was disinterested in the outcome. His bias is understandable, to some extent,because he was defending advice that he had given. However, Johnson's bias canhardly be thought to aid the credibility of testimony, especially when it isinconsistent with Rambus' contemporaneous business records. Johnson'sdefensive and adversaral manner might be attributed in part to the fact that hisadvice to Rambus was incomplete. In Johnson's presentations to Rambus, hefailed to explain that spoliation could occur not only on the 'eve of litigation,' ashe put it, but also if documents were destroyed when the company anticipated, orreasonably should have anticipated, litigation. That is a serious omission giventhat the test for spoliation universally includes this component. Nor did Johnson'spresentation, or anything else he claims to have said, explain that, in order to havean effective suspension of the document destrction plan during litigation,employees must be specifically instructed respecting what documents are relevantto the litigation (and thus canot be destroyed) and what documents are notrelevant (and thus can be destroyed). In sum, the fact that Johnson' testimony, inpart, is offered in defense of his less than complete advice is another reason not tocredit his testimony respecting the issue of whether and when Rambus anticipatedlitigation. When that is considered in perspective of the conflct betweenJohnson's testimony and that of Diane Savage and the Rambus business records,Johnson's testimony on the topic of Rmbus' anticipation of litigation is rejectedas lacking credibility.

Id. at 556-57.

5. Crisp Was Not a Credible Witness.

251. Richard Crisp, a former Rambus executive and Rambus's JEDEC representative,

19 also lacks credibility as a witness and has previously been adjudged to have given false

20 testimony. He testified in a deposition that he "never, ever" participated in Rambus's patent

21 drafting efforts. See Rambus, 155 F.Supp.2d at 681 ("For example, Richard Crisp (a former

22 executive, now a consultant to Rambus) testified in his first deposition that he 'never, ever'

23 participated in Rambus' s patent drafting efforts. However, when he was confronted with

24 documents obtained after the piercing' of the attorney-client privilege, Crisp was forced to admit

25 that he directed which claims should be filed in response to the technology discussions at

26 JEDEC."), Tr. of Mot. to Transfer Hearing, dated Aug. 23, 2005, Samsung Elecs. Co., Ltd. v.

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1 Rambus Inc., E.D. Va. Civil Action No. 3:05cv406, at 42:10-42:12 ("Mr. Tate and Mr. Crisp have

2 both been adjudicated in this court unappealed as having given false testimony.").

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5

252. Crisp's testimony should not be given credence.

N. Rambus Destroyed Documents in Bad Faith.253. Rambus's intentional planing of document destruction as part of its litigation

6 planning demonstrates bad faith. A company's obligation to preserve documents once it

7 anticipates litigation is well-established. To plan document destruction hand-in-hand with

8 litigation evidences bad faith.

9 254. Rambus's only basis for asserting that it acted in good faith was that its document-

10 retention policy is purportedly content-neutral and in keeping with other similar corporate

11 policies. See, e.g., Rambus's Pretrial FF/CL at pp. 35-42. Those facts, however, utterly fail to

12 address its conduct in failing to institute litigation holds. An appropriate policy is irrelevant once

13 Rambus anticipates litigation.

14 255. Although Rambus formally disavowed reliance on advice of counsel at the Hynix

15 trial, it presented evidence of such advice and argued extensively that it followed that advice in

16 adopting its document-retention policy. But Rambus has apparently abandoned that approach in

17 this case and has utterly failed to rely on advice of counsel in any form. See, e.g., Rambus's18 Pretrial FF at irir 123-25, 127, 130, CL ir 48 (arguing only.that it acted in good faith based on the

19 purported neutrality and typicality of its document retention policy); Sept. 22nd Trial Tr. 28-29

20 (assertion by Rambus's counsel that Rambus has not interjected the issue of advice of counsel

21 into this case).

22 256. As such, Rambus has waived any defense of advice of counsel in this case as

23 justification for its document destruction.

24 257. To the extent that Rambus does rely on the advice of Daniel Johnson, or other of

25 its attorneys, to justify its conduct as being in good faith, it failed to car its burden of proof to

26 demonstrate that it relied on the advice of counsel in developing and implementing its document-

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1 the contention that advice from its attorney(s) created a good-faith basis for its document

2 destruction.

3 258. Daniel Johnson testified that Rambus never told him about plans to litigate or

4 about their strategy, Hynix Trial Tr. 1792, so Rambus lacks any basis to contend that it was

5 advised by counsel that its document-retention policy could be implemented in good faith despite

6 its litigation and licensing plan.

7 259. Moreover, Karp had significant experience with litigation from his work with

8 Samsung and was familiar with the discovery process. Hynix Trial Tr. 143-44; Hynix Trial Tr.

9 138:2-22, 155:14-16, 157:9-19 (Karp had worked on litigation at Samsung involving Mitsubishi,

10 Fujitsu, Fortel, SEL, Hitachi, Hars, and Texas Instruments).

11 260. In addition, Rambus was on notice that any document-retention policy must be

12 developed and executed with the informed advice of counseL. When Karp approached Savage

13 about developing a document retention program, Savage knew nothing about Rambus's planned

14 litigation strategy, and Karp did not provide her with information necessary to evaluate whether

15 Rambus could properly destroy documents without making reasonable provision to preserve

16 relevant documents. When she sent the generic template of a document-retention policy to Karp,

17 Savage specifically alerted Karp that he should consult with her colleague David Lisi about

18 litigation concerns, but Karp did not contact either Savage or Lisi for further advice. Hynix Trial

19 Tr. 583:4-584:22; 591:10-592:2. Indeed, Savage testified that she expected to hear back on

20 tailoring the policy to Rambus's specific circumstances. Hynix Trial Tr. at 593.

21 261. In addition, Cecilia Gonzalez, counsel in the Hitachi litigation, had advised

22 Rambus not to destroy documents. Gonzalez Feb. 22, 2005 Infineon Tr. at 132-33 (see Hynix

23 Trial Tr. 1536:3- 1 7).

24 262. And when Alan Brill, a nonlawyer, made his security audit presentation, he

25 advised that Rambus should work with its lawyers in adopting a document retention policy.

26 Hynix Trial Tr. 369:13-374:10; RTX 160.

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1

2 documents if it was anticipating litigation. Hynix Trial Tr. 1721: 1 8- 1 722: 11. Cooley, Godward

263. Moreover, Johnson testified that he explicitly told Rambus that it could not destroy

3 did not list document retention or purging of attorneys' files in its February 23, 1998 "proposed

4 licensing and litigation strategy for Rambus." Karp added these tactics by hand, reflecting the

5 intention to use the document retention recommendation as an excuse for disposing of relevant

6 evidence. HynixTrial Tr. 188:3192:11; HTX 098.

7 264. Johnson's March 27, 1998 transmittal to Rambus of "a standard set of document

8 requests" makes it clear that Kar was concerned about "the type of information requested in

9 patent cases." Hynix Trial Tr. 1715:21-1716:9; HTX 368. Despite this knowledge, Rambus took

10 no action to revise its document-retention policy to assure that relevant documents would not be

11 destroyed. Moreover, it is reasonable to infer that Rambus used Johnson's indication "of the type

12 of information requested in patent cases" as a means of identifying, and ultimately destroying,

1 3 documents likely to be requested of Rambus in its contemplated DRAM patent litigation.

14 265. The evidence shows that after Shred Day 1998, it became a standing joke among

15 some Rambus employees that the real purpose of the document-retention policy was to eliminate

16 relevant evidence. Hynix Trial Tr. 1177:8-1180:8; HTX 152; Hynix Trial Tr. 1331:24-1333:18;

18

17 HTX255.

266. Rambus also attempted to cover up evidence of its deliberate document

19 destruction. When the SDRAM patent litigation began, Rambus did not inform its litigation

20 counsel about its 1999 and 2000 Shred Days. Witnesses told outside counsel that there was a

21 document-retention policy, but did not reveal Shred Day, and, in particular, did not reveal that

22 Shred Days were held in 1999 and 2000. Hynix Trial Tr. 742:1-743:8, 777:25-779:10. During the

23 course of representing Rambus in the Hitachi action, Gonzalez met with Karp, Steinberg, Tate,

24 Crisp, Mooring and Roberts, but no one from Rambus informed Gonzalez that Rambus held

25 Shred Days in 1999 and 2000. Gonzalez Feb. 22, 2005 Infineon Trial Tr. at 125:11-131:6,

26 136: 1 0- 15 (played at Hynix Trial Tr. 1536:3-17).

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1 267. The issue of spoliation was first uncovered and pursued in the Infineon case. The

2 most significant evidence demonstrating Rambus's spoliation was withheld from production

3 under claims of privilege or work-product protection. This evidence was ultimately revealed only

4 because of piercing orders entered in the Infineon case. Rambus used its best efforts to restrict5 the availability of evidence released under the piercing orders.

6 268. Developments in the Infineon case prompted Micron to seek a Rule 30(b)(6)

7 deposition from Rambus concerning its document-retention policy and the destruction of

8 documents. Steinberg was designated to testify on the company's behalf. Although it was under

9 a duty imposed by the Federal Rules to prepare its witnesses to testify to the full extent of the

10 corporation's knowledge, Steinberg testified that he was not aware of Shred Days in 1999 and

11 2000, and testified on behalf of Rambus that the Shred Day in 1998 was a one-time event. This

12 testimony was objectively false. Steinberg insisted that no one at Rambus informed him of a

13 second Shred Day in 1999. Hynix Trial Tr. 1471: 1 6- 1 473:21.

14 269. When Hynix thereafter noticed a Rule 30(b)(6) deposition, and Robert Kramer was

15 designated to testify to the company's knowledge, Kramer, again, was not informed that Shred

16 Days were held in 1999 and 2000, and gave objectively inaccurate testimony. Hynix Trial Tr.

17 1075:23-1078:6,1131:14-19.

18 270. This conduct by Rambus after questions were raised about the motivation for its

19 document-retention policy as part of its litigation strategy further shows a consciousness of guilt.

20 And Karp and Tate gave contrived explanations for Rambus's actions that are not credible.

21 271. Rambus used its best efforts to cover up the fact of spoliation. The remedy for

22 Rambus's conduct must consider the need for deterrence of similar conduct and the risk that this

23 or similar conduct would go undetected in other litigation. Rambus has consistently and

24 forcefully relied on the attorney-client privilege and work-product protection to screen the

25 important evidence of spoliation from its adversaries, and evidence of spoliation was uncovered

26 only by piercing orders. The risk that spoliation would have gone undiscovered was high, which

27






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1 emphasizes the need for a remedy with a deterrent effect. Any remedy short of dismissal would

2 not contribute to deterrence oflike conduct.

3 272. Moreover, without the remedy of dismissal, Rambus would benefit from its

4 spoliation because Samsung's ability to challenge the validity and enforceability of Rambus

5 patents has been irrevocably compromised.

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

o. The Spoliated Materials Were Relevant to This Litigation and Samsung WasMaterially Prejudiced by the Document Destruction.

273. Rambus kept no records of the documents that it destroyed. Hynix Trial Tr. 334:2-

12, 524:22-525:1, 11 18:15-19. Nevertheless, it is clear that Rambus destroyed documents

pursuant to its document-retention policy that had a nexus to the patent claims at issue. See

Hynix, 2006 WL 565893, at *27.

1. No Records Show Exactly What Rambus Destroyed, But theWholesale Destruction Encompassed Documents That Would HaveBeen Discoverable in Litigation.

274. There is no way to determine the specific documents that were destroyed, but it is

beyond doubt that based on the evid~nce of wholesale destruction and based on the evidence that

did survive that relevant and material evidence was destroyed. Moreover, prejudice can only be

presumed based on the record's demonstration of deliberate destruction of documents by Rambus

in order to rid itself of documents discoverable in litigation, and documents of the type that likely

would be relevant in litigation. Rambus's document-retention policy targeted "discoverable"

documents, including email messages, files on individual computers, network servers or floppy

disks, corporate databases, backup tapes, system records and logs, and computers and disks. See,

e.g., HTX 111.

275. Attention to "discoverable" documents was emphasized in the presentation of the

policy to the Rambus managers. HTX 111. Discoverability is a concept that exists only within

the context of litigation. To target, and then destroy, documents that are considered discoverable

is to identify and destroy documents that would be relevant or lead to the discovery of admissible

evidence in litigation.

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1 276. Pursuant to its document-retention policy, Rambus destroyed virtally all historic

2 internal correspondence, negotiating documents, engineering commentary on the scope of the

3 alleged Farmwald-Horowitz "inventions," and JEDEC materials. HTX 152; HTX 255; HTX 330;

4 HTX 331; Hynix Trial Tr. 289:14-290:4, 294:1-8, 332:15-23, 270:4-271:8, 1481:7-1483:25,5 806:5-807:5, 826:6-834:5, 895:3-899:3, 1076:24-1077:4, 1106, 608:10-610:25, 611, 614, 628,

6 630-31. There can be no doubt that Rambus destroyed discoverable documents pursuant to its

7 document-retention policy, and Samsung's inability to discover and use these documents is per se

8 prejudiciaL.

9 277. Rambus knew before it began destroying documents that document discovery in

10 any litigation over its patent claims would be extensive. HTX 368; Hynix Trial Tr. 137:6-144:6.

11 278. This litigation is not a typical patent case in which the transactional evidence is of

12 limited relevance. The DRAM manufacturers have asserted antitrust and equitable defenses

13 based on communications and other dealings with Rambus over the period 1990 through 2000.

14 Rambus knew that the DRAM manufacturers would be likely to raise such defenses when it

15 began planning to assert patent claims against manufacturers of SDRAM. HTX 078; HTX 085;

16 HTX 192; HTX 199; HTX 225; Hynix Trial Tr. 593:19-599:6, 802:7-15, 1160:5-1161:1.

17

18

19

20

21

22

2324

25

26

27

28

Rambus's Elimination of the Company's Records in 1998 PrejudicedSamsung.

279. As of 1998, Rambus was a document and email-intensive company. Hynix Trial

2.

Tr. 1582:11-1583:13. Rambus employees kept extensive paper files, and many archived

electronic data on their laptop computers, zip disks, and on other removable media. Hynix Trial

Tr. 274:22-275:5, 1187:23-1188:5,532:21-533:6. Rambus IP managers had followed the practice

of preserving backup tapes for most data stored in Rambus's computer system. Hynix Trial Tr.

195:18-196:4,1431:1-7.

280. As of 1998, Rambus used its archive of backup tapes to obtain data needed for

business purposes. It was "quite common" to retrieve information from the backup tapes. Hynix

Trial Tr. 1431:8-10. Indeed, Karp resorted to information from the backup tapes about a

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1 conception date for a patent before causing the erasure of Rambus's backup-tape archive. Hynix

2 Trial Tr. 224:4-226:5.

3 281. From 1990 until shortly before Karp arrved on the scene in October 1997, the

4 company had used Macintosh computers. Hynix Trial Tr. 1439:4-6, 1440:2-11. Rambus

5 maintained backup tapes of some of the data created on these computers. When Karp decided to

6 dispose of documents in 1998, he saw to it that the backup tapes were erased or otherwise

7 destroyed. HTX 013.097; Hynix Trial Tr. 208:19-218:14,250:14-16; HTX 013.097

8

9

10

11 282. It is impossible to determine which records these tapes contained, or what could

12 have been retrieved from such tapes at reasonable expense. Labels on the tapes indicate that

13 "full" back-ups of Rambus servers were erased, as well as tapes seeming to include records

14 attributable to key witnesses including Crisp and Tate. HTX 285; HTX 029.

15 283. In the Hynix litigation, although Rambus discovered some of the back up tapes, see

16 Hynix, 2006 WL 565893, at *13, the backup tapes did not include files on UNIX and Macintosh

17 workstations during the period from 1998 to 2000. Hynix Trial Tr. 1574:9-22. The discovery of

18 some of those tapes during the Hynix litigation does not negate the impact of the numerous others

19 that were destroyed, but instead further suggests the breadth of destruction intended by Rambus's

20 plans. See HTX 090 (failing to adequately explain the tapes' disappearance and reappearance).

21 The material preserved on the backup tapes could not replace records that existed as of 1998,

22 1999 or 2000 on UNIX and Macintosh workstations. Hynix Trial Tr. 1574:9-22.

23 284. Without any of this historical information available in discovery, Samsung was

24 prejudiced in its ability to defend against Rambus's claims.

25 3. Destruction of Electronic Files Prejudiced Samsung.

26 _ambus destroyed e-mails and other electronic files. HTX 013.001-013.097; HTX

27 112; Hynix Trial Tr. 332:16-23. By virte of the document-retention policy, backup tapes for

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1 emails were destroyed every three months from the policy's inception II September 1998

2

3

4

5

6

7

8 286. Email backup tapes were eliminated and employees were told to purge their own

9 individual email files uness it was necessar to keep an email for some purose in which case it

10 should be saved to a paricular file or reduced to hard copy. HTX 100; Hynix Trial Tr. 196:24-

11 197:7, 261 :20-265:1. The Rambus destruction policy also mandated the destruction of countless

12 zip drives, floppy disks, and data recorded on the hard drives of individual computers. RTX

13 091.003; Hynix Trial Tr. 532:8-533:6. There is no record of the data lost.

14 287. Prejudice must be presumed in light of document destruction of such an all-

15 encompassing swath; moreover, it is beyond doubt that relevant information was never available

16 to Samsung in its defense of this litigation.

17 4. Rambus's Destruction of Relevant Patent-Prosecution File MaterialsPrejudiced Samsung.

288. Rambus destroyed attorney notes, correspondence, and other documents from18

19Rambus's patent-prosecution files. Hynix Trial Tr. 895:3-899:3

20

21

22

23

24

289. Rambus also destroyed notes, fies, and other records from the files of the

inventors ofthe patents-in-suit. HTX 267; Hynix Trial Tr. 608:10-610:25, 616:9-20.

25

290. Rambus instructed its outside patent counsel, Vincent, to purge the patent-

prosecution files so as to make them conform to the file wrapper and thereby to eliminate much

information that typically is useful in patent litigation in addressing validity and infrngement

issues, as well as the conduct of the applicant before the PTO. Several of the prosecution fies26

27

28

that Vincent purged in 1999 were directly related to the patents-in-suit. See HTX 327 at 4, entry





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1 no. 95 (U.S. Pat. No. 5,841,580 files purged by Vincent on June 29, 1999); Hynix Trial Tr. 806:5-

2 815:6; see also HTX 335; Hynix Trial Tr. 830:3-25 (identifyng the files cleaned out by Vincent).

3 291. The documents that Vincent destroyed pursuant to Rambus's instructions included

4 drafts of" patent applications and amendments, correspondence to and from Rambus, and

5 drawings. Hynix Trial Tr. 895:3-899:3.

6 292. Many of the documents from patent prosecution files that Vincent destroyed

7 directly relate to the patents-in-suit. Compare HTX 005A with HTX 327; Hynix Trial Tr. 826:6-

8 834:5.

9 293. Not only are documents ofthe sort destroyed by Vincent clearly relevant to patent

10 litigation, they are, at a minimum, reasonably calculated to lead to the discovery of admissible

11 evidence. It is not possible that the destruction of such documents did not har Samsung's

12 ability to defend in this litigation. Although Rambus has contended that certain of the "cleansed"

13 patent files possessed by Blakely Sokoloff were copied before "cleansing," and that certain

14 destroyed documents from those files were privileged and would not have been available in

15 discovery, the pervasive and largely uncontrolled destruction of Rambus documents makes it

16 impossible to identify precisely what was destroyed. It is impossible to determine whether

17 copying some portion of Blakely's patent files before "cleansing" did not deprive Samsung of

18 relevant evidence or conclude that all the patent-prosecution file documents that were

19 destroyed-which are unavailable for the Court's review-were privileged.

20

21

Rambus's Destruction of Prior Art and Inventor Materials PrejudicedSamsung.

294. Rambus's production of prior ar materials was deficient. The only prior art

5.

22produced by Rambus consisted of references cited to the Patent Office. Hynix Trial Tr. 949:15-

950: 1. Prior art materials not cited to the Patent Office would be relevant to defenses of23

24

25

26

27

28

invalidity, inadequate written description, and possible inequitable conduct.

295. Prior-art documents were discarded by Rambus. Jose Moniz began working on

Rambus matters at Steinberg's law firm in Virginia in January 1999. Hynix, 2006 WL 565893, at

*19 (citing Hynix Trial Tr. 1626:15-1627:3; 1628:7-12). As part of his duties while working for






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1 Steinberg in early 1999, Moniz conducted a search for prior ar relating to Rambus patent

2 applications claiming priority to the original '898 application. Hynix, 2006 WL 565893, at *19

3 (citing Hynix Trial Tr. 1629:12-25). In March through May 1999, Steinberg and Moniz did an

4 extensive review of possible prior ar. Steinberg and Moniz destroyed working copies of their

5 notes and working copies of prior art references. Hynix Trial Tr. 1459:6-1455:4, 1481:7-1483:25;

6 Hynix Trial Tr. 1660:5-11; Hynix Trial Tr. 1452:1-8; 1454:23-1455:4; 1641 :3-12. Had Steinberg

7 and Moniz consulted with Johnson on this point, he would have advised them that this destruction

8 would be improper. See Hynix Trial Tr. 1727:2-12 (Johnson stating, "Oh no. You don't get rid

9 of prior art").10 296. Moniz failed to preserve a spreadsheet he prepared that listed prior art collected on

11 behalf of Rambus and how it was used. Hynix Trial Tr. 1659:13-25.

12 297. Horowitz did an extensive search of possible pnor art in advance of the April 1990

13 filing of the Farmwald-Horowitz application. Hynix Trial Tr. 603:22-608:25. No documents

14 reflecting this search were produced. Hynix Trial Tr. 603:22-608:9,611: 13-25,614:5-10.

15 298. It must be presumed that Samsung has been prejudiced by the deficiency in

16 Rambus's production of prior art materials. Notes made on or about prior art materials by

17 Horowitz, Vincent, Rambus engineers, Steinberg or Moniz would be material to the validity and

18 enforceability of the patents in suit. Rambus has not proven the absence of prejudice.

19 299. In addition, as of 1995, Farmwald had a notebook, a model and detailed diagrams

20 relating to the alleged "inventions" dating from his work at the University of Ilinois. HTX 267.

21 Horowitz admitted that he kept notes on scraps of paper prior to starting an engineering notebook

22 some time after the original patent application was filed. Hynix Trial Tr. 610: 1 5-611: 1 6. These

23 materials were not produced, and no adequate explanation was provided. Hynix Trial Tr. 939:13-24 940:15; see also id. at 938:20-25, 939:8-12 (acknowledging that no documents produced that

25 present technology in the level of detail included in the Farmwald-Horowitz application).

26 300. It must be presumed that Samsung has been prejudiced by the destruction of

27 inventorship documents. Inventor documents would be highly material to issues of invalidity,






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1 inventorship, and adequacy of the written description of the alleged "inventions." Rambus has

2 failed to prove the absence of prejudice.

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

Rambus's Across-the-Board Destruction of License NegotiationDocuments Prejudiced Samsung.

301. It is clear that documents relevant to Samsung's contract claims were also

6.

destroyed. Materials relevant to contract negotiations and license terms were destroyed on a

wholesale, across-the-board basis. Rambus destroyed correspondence, meeting presentations

with third parties, and other documents generated during Rambus's licensing negotiations with

DRAM manufacturers. HTX 114; HTX 178. Testimony demonstrated that all contract and

negotiation documents, other than final executed copies, were directed to be destroyed and were

destroyed, and that would include drafts and materials used during negotiations such as notes of

meetings and telephone conversations, presentation slides, memoranda, and checklists. Hynix

Trial Tr. 641:5-13, 1402:3-10,609:6-616:20; HTX 178.

302. The document destruction was continuing when Samsung became a licensee to the22

2324

25

26

27

28

SDR/DDR License agreement at issue in this litigation in October 2000. Sept. 22nd Trial Ex.

4226. Negotiations for that license took place beginning in March 2000 and were ongoing at the

time that Steinberg sent his July 17, 2000 email reminder to executives to destroy all drafts of

contract negotiation documents once the final agreement was executed. Sept. 22nd Trial Ex.

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1 303. In addition, the SDR/DDR License had been executed by the time of the

2 December 2000 shredding event. See Sept. 22nd Trial Ex. 4226. There is no record of what was

3 destroyed in the December 2000 purge.

4304. These kind of documents have particular relevance to the contract issues in this

5 case and the damages aspect of patent litigation, and of course, they can also lead to the discovery

6 of other admissible evidence.

7

8

9

7. The Types of Documents That Escaped Document Destriiction and theActivities of Rambus During 1998-2000 Confirm the Types ofDocuments That Were Spoliated.

305. Rambus kept no record ofthe documents it destroyed. Hynix, 2006 WL 565893, at

10 *17 (citing Hynix Trial Tr. 334:2-12; 524:22-525:1; 1118:15-19). Yet some documents that

11 fortitously escaped Rambus's document-destruction efforts and have been produced by Rambus

12 employees from their own personal files after their departe from Rambus, such as by Robert

13 Kramer and Karp, offer some clue as to types of documents that may no longer exist. Several

14 such documents were produced as recently as in 2008 from Joel Karp's personal files confirming

15 that Rambus had obtained and reverse engineered a Samsung DDR SDRAM by December 1998.

16

17 Trial Ex. 4406 (enclosing two copies of a report entitled: A Preliminary Design Analysis of the

306. Rambus had reverse-engineering reports completed by December 1998, Sept. 22nd

19

18 Samsung KM416H403IT-G10 4Mx16 DDR SDRAM); see also Hynix Trial Tr. 284-85.

20 that Samsung discovered recently in this litigation that Kar retained a few documents on a

307. It was only happenstance and as a result of dogged efforts on the part of Samsung

21 computer that he had relocated to his home. See also Sept. 22nd Trial Ex. 4281. The reverse-

22 engineering reports of Samsung products were never produced by Rambus-rather, they were

23 produced for the first time in 2007 from Joel Karp's personal files kept at his home only after the

24 Court ordered their production. Sept. 22nd Trial Tr. 670:5-9.

25 308. These reports and similar documents that are unavailable as a result of the

26 document destruction are supportive of Samsung's invalidity defenses, including enablement,

28

27 best mode, and written description under 35 U.S.C. 112, by highlighting Rambus's inability to


CONCLUSIONS OF LAW REGARING SPOLIATION AND UNCLEANHADS (CONFIDENTIAL VERSION: FILED UNDER SEAL)

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1 wrte claims that it believed to cover SDRA until having a Samsung DDR SDRAM reverse-

2 engineered more than eight years after the '898 specification that purportedly supports those

3 claims was filed with the PTO. Rambus's document destruction has materially prejudiced

4 Samsung's ability to defend by precluding it from obtaining all of the evidence relevant to its5 invalidity defenses.

6 309. Samsung cannot be expected to know what other destroyed documents it might

7 have been able to use in tryng its case. It is certainly clear that relevant documents existed that

8 would have been available if not for Rambus's document destruction.

9 310. Rambus failed to show that Samsung was not prejudiced by the massive document

10 destruction.

11

12

8. Samsung's Abilty To Elicit Information from Witnesses WasPrejudiced by the Absence of the Materials That Would Have BeenAvailable Had Rambus Not Destroyed Them.

13 311. Samsung is also prejudiced by Rambus's destruction of documents because

14 Rambus employees and agents have repeatedly claimed that they have no independent

15 recollection of the relevant events, and without documents, full discovery of the facts is

16 impossible. It is evident that many relevant documents were destroyed as a result of Rambus's

17 document destruction in 1998, 1999 and 2000. Without documents, there is no effective way fori

18 Samsung to lear important admissions or events or challenge witnesses' lack of recollection of

19 material facts.

20 312. Even with documents, witnesses have professed a lack of recollection. For

21 example, Leal, a former Cooley Godward attorney, had no recollection of his Januar 13, 1998

22 meeting with Karp and Tate. All he could testify to was that his notes were a record of that

23 meeting. Peter Leal Dep. Tr., 10129/05 (played at Hynix Trial Tr. 1531:23-1533:7, 1535:25-

24 1536:4). Vincent did not recall the content or timing of his meetings with Rambus engineers to

25 amend the Farwald-Horowitz application, including that Rambus asked him to amend the

26 application so that it would read on JEDEC-standard DRAMs. Hynix Trial Tr. 818:1-819:23.

27


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1 313. These examples show that the documents were essential to recover eviden

2 concerning material events. In these ilustrations, even though documents surived, it was

3 difficult or impossible to refresh the recollection of the witnesses. Absent these documents, there

4 would have been no evidence to establish the facts indicated because the witnesses denied5 recollection. Samsung was of course prejudiced by the unavailability of other documents, which

6 were destroyed.

7 314. For instance, during the recent trial on Samsung's MFL counterclaims, Tate could

8 not recall what internal discussions there may have been at the time of Rambus' s investor

9 conference following the Hitachi settlement that would contradict Rambus's statements to

10 investors regarding whether RDRAM or JEDEC-standardized SDR/DR DRAM should be

11 Rambus's top licensing priority, Sept. 22nd Trial Tr. 745,

12

13 The absence of documentar evidence hampered14 Samsung in its ability to develop this evidence and to examine Tate on these points.

15

16

17

18

19

II. PROPOSED CONCLUSIONS OF LAW ON SAMSUNG'S UNCLEAN-HANDS CLAIM

A. Rambus Committed Spoliation in Destroying Documents Relevant toPotential Litigation with Samsung.

1. A Party Anticipates Litigation When Litigation Is Reasonably Possibleor Contemplated.

The majority of courts are in agreement that litigation is anticipated, and thus the.

20 obligation to preserve reasonably related documents is triggered, when litigation is reason

21 possible. See John B. v. Goetz, 531 F.3d 448, 459 (6th Cir. 2008) ("As a general matter,

22 beyond question that a party to civil litigation has a duty to preserve relevant informa

23 including (electronically stored information), when that party 'has notice that the evide

24 relevant to litgation or . . . . should have known that the evidence may be relevant to

25 litigation."') (citation omitted); Silvestri, 271 F.3d at 591 (finding that obligation to preserve the

26 evidence "extends to that period before the litigation when a pary reasonably should know

27 the evidence may be relevant to anticipated litigation," and defining spoliation as "the destru




CASE NO. C OS 00334RMWCASE NO. C OS 02298 RMW


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1 or material alteration of evidence. . . in pending or reasonably foreseeable litigation") (emphasis

2 added); Kronisch v. United States, 150 F.3d 112, 126 (2d Cir. 1998) ("This obligation to preserve

3 evidence arises when the pary has notice that the evidence is relevant to litigation-most

4 commonly when suit has already been filed, providing the pary responsible for the destrction5 with express notice, but also on occasion in other circumstances, as for example when a pary

6 should have known that the evidence may be relevant to future litigation."); Loveless v. John's

7 Ford, Inc., 232 Fed. Appx. 229, 236 (4th Cir. 2007) ("When a party either fails to preserve or

8 destroys potential evidence in a foreseeable litigation, it can be deemed to have engaged in the

9 'spoliation of evidence''') (emphasis added); Shamis v. Ambassador Factors Corp., 34 F.Supp.2d

10 879, 888-89 (S.D.N.Y. 1999) (asking whether the party "knew or should have known that the

1 1 destroyed evidence was relevant to pending, imminent, or reasonably foreseeable litigation")

12 (emphasis added).

13 2. The undisputedly seminal case in this area is Zubulake v. UBS Warburg LLC,

14 which states, consistent with the courts cited above, that "( s Jpoliation (of evidence J is 'the

15 destruction or significant alteration of evidence, or the failure to preserve property for another's

16 use as evidence in pending or reasonably foreseeable litigation.''' Zubulake, 220 F.R.D. at 216

17 (emphasis added) (quoting West v. Goodyear Tire & Rubber Co., 167 F.3d 776, 779 (2d Cir.

18 1999)). Under this standard, a duty to preserve evidence arises when someone "anticipates being

19 a party or is a pary to a lawsuit" or "recognize(esJ the threat oflitigation." See, e.g., id. at 217.

20

21

22

23

24

25

26

27

28

Litigation Is Anticipated When Litigation Is Reasonably Possible orContemplated, Even When on a Delayed or Long-Term Basis.

3. The duty to preserve potential evidence is triggered by the anticipation of

2.

litigation, regardless of whether a party plans for business reasons to delay that litigation until the

occurrence of far-off events.

4. Documents destroyed years before suit was filed have been found to have been

destroyed in anticipation of litigation. See, e.g., Kronisch, 150 F.3d at 126 (duty to preserve

documents arose ten years before suit was filed); MT&T Mortgage Corp. v. Miler, No. CV 2002-

5410 (NG) (MDG), 2007 WL 2403565, at *6 (E.D.N.Y. Aug. 17, 2007) (duty to preserve






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1 evidence arose three years before suit was filed); see also Byrnie v. Town of Cromwell, Bd. of Ed.,

2 243 F.3d 93,108 (2d Cir. 2001) (citing Kronisch for proposition that "documents destroyed years

3 before suit (wasJ brought could reasonably be found to have been destroyed in anticipation of

4 litigation where fear of potential future litigation plausibly motivated the spoliation."). Indeed,5 litigation does not need to be certain or imminent to give rise to the duty to preserve evidence.

6 See, e.g., Scott v. IBM Corp., 196 F.R.D. 233, 249 (D.N.J. 2000) (finding spoliation because

7 "while litigation was not guaranteed, it could be viewed as reasonably foreseeable"); In re

8 Weschler, 121F.Supp.2d 404, 415 (D. DeL. 2000) (finding spoliation where there is "pending,

9 imminent, or reasonably foreseeable litigation" and noting that "a party who has reason to

10 anticipate litigation has an affirmative duty to preserve evidence which might be relevant to the

11 issues in the lawsuit") (citation omitted); Howell v. May tag, 168 F.R.D. 502, 507 (M.D. Pa. 1996)

12 ("(TJhe knowledge of a potential subrogation claim is deemed sufficient to impose a duty to

13 preserve evidence.") (citation omitted).

14 5. A would-be plaintiff "anticipates or contemplates litigation," when it is

1 5 consciously considering the option of bringing litigation, even if it has not made a firm or

16 irrevocable decision to do so. See, e.g., Struthers Patent Corp. v. Nestle Co., Inc., 558 F.Supp.

17 747, 765-66 (D.N.J. 1981) (plaintiffs conduct while "contemplating" litigation "constituted

18 wilfull (sicJ destruction of documents in anticipation of litigation"); Baliotis v. McNeil, 870

19 F.Supp. 1285, 1290 (M.D. Pa. 1994) (holding that insurer owed a duty to preserve evidence as

20 soon as it identified a potentially responsible party); In re Wechsler, 121 F.Supp.2d at 415 ("A

21 party who has reason to anticipate litigation has an affirmative duty to preserve evidence which

22 might be relevant to the issues in the lawsuit.").

23 6. It is not unusual that the anticipation of litigation is quite concrete, notwithstanding

24 that the events giving rise to the litigation have not yet occurred. See, e.g., United States v.

25 Adlman, 68 F.3d 1495, 1501 (2d Cir. 1995). Indeed, courts have recognized that litigation

26 planning can involve contingencies, delays, or be of an extended duration. See, e.g., United

27 States v. Mass. Inst. of Tech., 129 F.3d 681,687 (lst Cir. 1997) ("MIT doubtless hoped that there

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1 would be no actual controversy between it and the Department of Defense, but the potential for

2 dispute and even litigation was certainly there."); Grinnell Corp. v. ITT Corp., 222 F.R.D. 74, 78

3 (S.D.N.Y. 2003) (rejecting contention that company did not anticipate litigation because at the

4 time the internal documents were created, testimony suggested that "we didn't know (in June

5 1998J that a suit would automatically follow. I mean, I guess we expected it, kind of, but that's

6 something we had to see, whether it would happen or not" and concluding that the testimony

7 established the contrary, that is, that the company viewed litigation "as a very real possibility,

8 albeit not 'automatically"').

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3. A Party's Anticipation of Litigation Is Evaluated Under an Objective-Person Standard.

7. A party's anticipation of litigation is assessed ac.cording to an objective standardby considering whether a reasonable person would have anticipated litigation under like

circumstances. In Zubulake, the court held that a client's duty to preserve evidence in the pre-

litigation context arises "when a party should have known that the evidence may be relevant to

future litigation." 220 F.RD. at 216 (quotation and citation omitted); see also Goetz, 531 F.3d at

459 ( ("(IJt is beyond question that a party to civil litigation has a duty to preserve relevant

information, including electronically stored information, when that party 'has notice that the

evidence is relevant to litigation or . . . should have known that the evidence may be relevant to

future litigation. "') (emphasis added); Silvestri, 271 F.3d at 591 ("The duty to preserve material

evidence arises not only during litigation but also extends to that period before the litigation when

a party reasonably should know that the evidence may be relevant to anticipated litigation.")

(emphasis added); Kippenhan v. Chaulk Servs., Inc., 428 Mass. 124, 127 (1998) (holding that

duty to preserve evidence triggered when a party or its expert "knows or reasonably should know

that the evidence might be relevant to a possible action").

8. Given this objective standard, even if this Court were to accept Rambus's

contention that it subjectively did not "anticipate" litigation before December 1999-because

Rambus allegedly did not "desire" to litigate and thought it would be able to execute licenses with

all the manufacturers-that would not mean that litigation was not reasonably foreseeable. In

SAMSUNG'S POST-TRIAL PROPOSED FINDINGS OF FACT ANDCONCLUSIONS OF LAw REGARING SPOLIATION AND UNCLEAN

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1 fact, the Court concludes otherwise from the contemporaneous documents, which contradict the

2 self-serving trial testimony of Rambus's witnesses.

3 9. Spoliation can occur even in the absence of bad faith. See Glover v. Bic Corp., 6

4 F.3d 1318, 1329 (9th Cir. 1993) (stating that "bad faith" is not a prerequisite to permitting an5 adverse inference from spoliation, and that simple notice of "potential relevance to the litigation"

6 is sufficient) (internal quotation marks and citation omitted); Reily v. Natwest Mkts. Group Inc.,

7 181 F.3d 253, 268 (2d Cir. 1999) (holding "that a finding of bad faith or intentional misconduct is

8 not a sine qua non to sanctioning a spoliator with an adverse inference instruction"). Spoliation

9 of evidence occurs where, as here, a party (Rambus) failed to properly preserve property for

10 another's use as evidence in reasonably foreseeable litigation. See, e.g., Zubulake, 220 F.R.D. at

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4. Rambus Anticipated Litigation with Samsung Beginning in Early1998.

10. Rambus contemplated litigation against Samsung and other manufacturers no later

than February 1998, when it employed the Cooley Godward firm and instructed that firm to help

develop a licensing and litigation strategy for assertion of Rambus patents against JEDEC

standard SDRAMs.

1 1. Rambus therefore came under a duty to take reasonable steps to preserve and not

to destroy evidence that was likely to be relevant should such litigation occur. As demonstrated

by the many contemporaneous business documents and by the testimony of involved individuals,

Rambus anticipated litigation with several DRAM manufacturers, including specifically

Samsung, beginning in early 1998.

12. As a result, Rambus's duty to preserve evidence that was relevant to the

anticipated litigation with Samsung arose by at least February 1998.

13. Rambus actually expected and anticipated that the following contingencies would

come to pass and lead Rambus into litigation with DRAM manufacturers: (1) awaiting the direct

RDRAM ramp to be sufficiently developed so as not to jeopardize RDRAM production;

(2) issuance of Rambus's patents covering non-RDRAM technology; (3) availability of product

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1 samples from potentially infrnging DRAM manufacturers in the market; (4) reverse engineering

2 and creation of claim charts showing coverage of the actual products; (5) approval by Rambus's

3 board to commence negotiations with a DRAM manufacturer; and (6) rejection by the targeted

4 DRAM manufacturer of Rambus's licensing terms.5 14. Rambus developed its document-retention policy expressly for the purpose of,

6 preparng for this coming litigation. Its anticipation of litigation was quite concrete,

7 notwithstanding that the events giving rise to the litigation had not yet occurred. Indeed, the fact

8 that Rambus was planing for such litigation contingencies confirms that Rambus reasonably

9 foresaw the litigation.

10 15. The "hiring of litigation counselor actually filing suit is certainly not necessar to

11 demonstrate that a company anticipates litigation." Hynix, 2006 WL 565893, at *24.

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Inconsistent, Misleading or False Testimony of Witnesses, Which AlsoConflcts with Contemporaneous Documents, Should Not be Credited.

16. A witness's prior testimony is informative on the issue of credibility. It is well-

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established that a witness places his credibility at issue when he takes the stand. United States v.

Reid, 634 F.2d 469,473-74 (9th Cir. 1980). Moreover, "it is axiomatic that the defendant may

employ the witness's prior inconsistent statements in order to impeach the credibility of the

witness." United States v. Adamson, 291 F.3d 606, 612 (9th Cir. 2002); United States v. Arteaga,

11 7 F.3d 388, 397 n.18 (9th Cir. 1997) ("If a witness says 'X' on the stand, his out-of-court

statement 'not-X' impeaches him, whether X is true or not."); United States v. Bao, 189 F.3d 860,

866 (9th Cir. 1999) ("(a J prior inconsistent statement is admissible to raise the suggestion that if a

witness makes inconsistent statements, then his entire testimony may not be credible"). ' The

testimony of witnesses who have given inconsistent, misleading, or false testimony should not be

credited.

17. The testimony of witnesses whose testimony is contradicted by contemporaneous

documents should not be credited. See, e.g., United States v. us. Gypsum Co., 333 U.S. 364, 396

(1948) (overtrning trial-court decision for relying on testimony of over two dozen witnesses

instead of contradictory contemporaneous documentary evidence and reasoning that "( w Jhere





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1 such testimony is in conflict with contemporaneous documents we can give it little weight,

2 particularly when the crucial issues involve mixed questions of law and fact"); Purex Corp. v.

3 Procter & Gamble Co., 664 F.2d 1105, 1108 (9th Cir. 1981) (affirming district court's decision to

4 discount testimony of witness since it found contemporaneous documents persuasive); Doe v.

5 Menefee, 391 F.3d 147, 168 (2d Cir. 2004) (fiding the distrct cour clearly erred in ruling

6 witness's testimony credible in its entirety since district court did not consider previous

7 inconsistent admissions and testimony).

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6. As an Attorney, Neil Steinberg Committed Ethical Violations ThatUndermine His Trustworthiness as a Witness.

18. Steinberg was an untrustworthy witness as a matter of law based on his dual

unauthorized representation of Rambus and Samsung while he was stil in-house counsel forSamsung. When Rambus first retained Steinberg, he was in-house counsel for Samsung and

owed Samsung, as a current client, the utmost duty of good faith and loyalty. See generally D.C.

R. OF PROF. CONDUCT; N.D. CAL. Civ. LOCAL R. 11-4(a)(1) (mandating compliance with

standards of professional conduct for State Bar of California). All attorneys owe their clients a

fiduciary duty, requiring them to "serve the client's interest with the utmost loyalty and

devotion." Herbin v. Hoeffel, 806 A.2d 186, 197 (D.C. 2002) (quotation and citation omitted);

see also First Am. Corp. v. Al-Nahyan, 17 F.Supp.2d 10,27 (D.D.C. 1998) ("Lawyers owe their

clients certain fiduciary duties. Like other agents, they owe both a duty of loyalty and a duty of

care."). This obligation is "one of 'uberrma fides, which means, most abundant good faith,

requiring absolute and perfect candor, openness and honesty, and the absence of any concealment

or deception.''' Herbin, 806 A.2d at 197 (quotation and citation omitted). Steinberg's

unauthorized dual representation violated the ethical obligations that Steinberg owed to Samsung

as a current client.

19. Steinberg's duties also precluded him from working for anyone adverse to

Samsung's interests while he was an attorney for Samsung. See generally D.C. RULE PROF.

CONDUCT 1.6, 1.7, and 1.9; CAL. R. OF PROF. CONDUCT 3-300,3-310,3-100; Hendry v. Pelland,

73 F.3d 397, 401 (D.C. Cir. 1996) (explaining that rule prohibiting representation of differing






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1 interests is "equivalent to a breach of an attorney's fiduciary duty" and that "a basic fiduciary

2 obligation of an attorney is the duty of 'undivided loyalty,' which is breached when an attorney

3 represents clients with conflicting interests.) (citing Griva v. Davison, 637 A.2d 830, 837-41

4 (D.C. 1994)); see also Avianca, Inc. v. Harrison, 70 F.3d 637, No. 94-7053, 1995 WL 650232, at

5 *2 (D.C. Cir. Oct. 24, 1995). Samsung's and Rambus's interests were undeniably adverse for

6 puroses of a conflict-of-interest assessment. See, e.g., Rambus Inc. v. Samsung, 2007 WL

7 39374, at *5 (noting the paries' adverse positions). Steinberg's dual representation was a further

'8 violation of Steinberg's ethical duties for this reason as well.

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7. Rambus's Claims of Work-Product Protection for Documents Dated in1998 and 1999 Further Demonstrate That Rambus AnticipatedLitigation in That Time Frame and Thus Had a Duty to PreserveRelevant Evidence.

20. Rambus's assertions of work-product protection for 1998 and 1999 documents

further show that Rambus anticipated litigation at that time and had a duty to preserve evidence.

One accepted analytical tool for determining when litigation is anticipated is the widely

developed standard for anticipation of litigation under the work-product doctrine. The work-

product doctrne provides that documents and tangible things prepared in anticipation of litigation

or for trial are only discoverable upon a showing that the party seeking them has substantial need

of them in preparation of its case and that the materials cannot be obtained by other means

without undue hardship. See FED. R CiV. P. 26(b)(3); Hickman v. Taylor, 329 U.S. 495 (1947).

Work-product precedent provides a helpful guide for assessing when a pary anticipates litigation

in the spoliation context because the scope of the duty to preserve evidence is defined by when a

party anticipates litigation or recognizes the prospect oflitigation on an actual or potential claim.

21. In order for a document to receive protection as attorney work product, it "must be

prepared because of the prospect of litigation when the preparer faces an actual claim or a

potential claim following an actual event or series of events that reasonably could result in

litigation." Natl Union Fire Ins. Co. of Pittsburgh, Pa. v. Murray Sheet Metal Co., Inc., 967

F .2d 980, 984 (4th Cir. 1992) (emphasis added). The Second Circuit explained that "(a Jlthough

the non-occurence of the events giving rise to the anticipated litigation is a factor that can argue






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1 against application of the work product doctrne, especially when the expected litigation is merely

2 a vague abstract possibility without precise form. . . there is no rule that bars application of work

3 product protection to documents created prior to the event giving rise to litigation." Adlman, 68

4 F .3d at 1501. Indeed, in many instances, the expected litigation is quite concrete, notwithstanding

5 that the events giving rise to it have not yet occurred. Id.

6 22. Documents dated in 1998 and 1999 were claimed by Rambus in Rambus v.

7 Infineon to be protected by the work-product doctrine. See Hynix, 2006 WL 565893, at *24.

8 These claims of work product demonstrate that Rambus did anticipate litigation in relation to

9 these documents and had a duty to preserve relevant evidence during this time.

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23. The fact that the privilege log was prepared by California lawyers and that

California law might be interpreted to differ from federal law to protect a lawyer's work product

prepared in a nonlitigation capacity does not affect the conclusion that Rambus anticipated

litigation at the time it claimed work-product protection. Federal law governs claims of work-

product protection and attorney-client privilege in federal cases. See FED. R. Civ. P. 26(b)(3);

FED. R EVID. 501. Rambus's patent-infrngement claims are federal-question claims, and there

can be no suggestion that any lawyer working with Rambus on its licensing and litigation strategy

might not be aware that the litigation contemplated was patent litigation governed by federal law.

Federal Rule of Civil Procedure 26(b )(3) clearly requires anticipation of litigation with respect to

the work-product doctrine:

(A J pary may obtain discovery of documents and tangible things otherwisediscoverable under subdivision (b)(1) of this rule and prepared in anticipation oflitigation or for trial by or for another pary or by or for that other party'srepresentative (including the other party's attorney, consultant, surety, indemnitor,insurer, or agent) only upon a showing that the party seeking discovery has

substantial need of the materials in the preparation of the party's case and that the

party is unable without undue hardship to obtain the substantial equivalent of thematerials by other means.

FED. R Civ. P. 26(b)(3); see also In re EchoStar Commc'ns Corp., 448 F.3d 1294, 1301 (Fed.

Cir. 2006) (applying Rule 26(b)(3)).






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8. Rambus Continued to Anticipate Litigation with Samsung Even Afterthe Parties' SDRlDR License Was Executed in 2000.

2 24. Spoliation can occur while two paries are in settlement negotiations or even after

3 an agreement for a limited term is reached if one of those paries nevertheless has reason to

4 believe that litigation is reasonably foreseeable. Spoliation can occur any time that litigation is5 anticipated, which may be years before suit is filed and even if litigation depends on contingent

6 events in the future. See, e.g., Kronisch, 150 F.3d at 126; Adlman, 68 F.3d at 1501. Furthermore,

7 because Rambus was actively litigating the same claims and defenses against Samsung's largest

8 competitors during the entire term of the license, Rambus was under a duty to preserve

9 documents relevant to those litigations-evidence that would have been relevant to Samsung's

10 claims and defenses as well.

11 25. Whether a party anticipates litigation is necessarily a fact-specific inquiry and,

12 therefore, it is possible for one pary involved in contract or settlement negotiations to anticipate

13 litigation-so that pary reasonably foresees that litigation could ultimately ensue notwithstanding

14 the settlement or contract negotiations, while the other party to the negotiations does not.

15 Rambus determined from at least as early as 1998 to embark on a campaign to enforce its patents

16 with a plan that included licensing and, when licensing efforts failed to meet Rambus's demands,

17 litigation. That plan explicitly contemplated litigation with Samsung. In addition, Rambus's

18 actions following execution of the license (e.g., its claim that evolutionary products were not

19 covered, its refusal to abide by its MFL obligations, and its failure to negotiate in good faith)

20 demonstrate Rambus did not intend to abide by its representations and obligations to Samsung

21 thereunder. As a result, Rambus continued to anticipate litigation even after the parties'

22 negotiations in 2000 resulted in the execution of the 2000 license, and throughout the duration of

23 the paries' license and its amendments until Rambus unilaterally terminated the license and sued

24 Samsung in June 2005.

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9. Spoliation Occurs Whenever Relevant Documents Are DestroyedDespite the Obligation to Preserve, Not Just When DamagingDocuments or Specific Categories of Documents Are SelectivelyDestroyed.

Spoliation occurs when the destrction of evidence in anticipation of litigation is

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4 wilful, or when that destruction is the result of inadvertent, albeit negligent, conduct. See, e.g.,5 Silvestri, 271 F.3d at 593-95; Residential Funding, 306 F.3d at 108 ("(TJhe 'culpable state of

6 mind' factor is satisfied by a showing that the evidence was destroyed 'knowingly, even if

7 without intent to (breach a duty to preserve itJ, or negligently''') (citation omitted); United States

8 ex reI. Koch v. Koch Indus., Inc., 197 F.R.D. 488, 490 (N.D. Okla. 1999) ("Spoliation includes

9 the intentiona

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