Intellectual Ventures I, LLC et al. v. Lenovo Group Ltd. et al. (16-cv-10860).

Judge Cabell granted in part Defendants’ motion to supplement the existing protective order to permit the designation of documents as subject to a patent acquisition bar. This designation would mean that any party or attorney with access to such a document would be prohibited for acquiring patents or applications relating to the same subject matter as the patents in suit, or advising client regarding the same, for a period of two years following the conclusion of the litigation. The motion was allowed as relates to defendant EMC Corporation, but denied as to Lenovo and NetApp. Judge Cabell identified Intellectual Ventures as being in the business of “monetizing patents through litigation and licensing campaigns,” and noted that the business had acquired close to 100,000 patents in its lifetime. After deciding that Federal Circuit law governed the issue, Judge Cabell rejected the majority approach, which required the moving party to first show an unacceptable risk of inadvertent disclosure of confidential information, on a counsel-by-counsel basis, if no bar is put in place, finding that this placed an unrealistic burden on the moving party and contradicted Federal Circuit case law. Instead, he determined that the burden of demonstrating the existence or absence of risk should be on the party who possesses that information, such that once a bar is in place, it is up to the non-moving party to seek exemptions from the bar on a counsel-by-counsel basis. Applying this standard, Judge Cabell found the risk that Intellectual Ventures’ counsel would be unable to compartmentalize the confidential information of EMC when subsequently advising their client on future patent acquisition and litigation. Judge Cabell limited the information that could qualify for this designation to confidential technical information, such as source code and schematics, and excluded confidential financial information from this protection. As to the Lenovo and NetApp defendants, Judge Cabell determined that they had failed to show good cause or a significant risk of inadvertent disclosure of their confidential information, and he denied them the use of the designation.

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