Court Finds that Lucent and Its Attorneys Tried to “Hide the Ball” and Engaged in Sanctionable Conduct

Tantivy Communications, Inc. v. Lucent Techs. Inc., 2005 WL 2860976 (E.D. Tex. Nov. 1, 2005)

Tantivy Communications, Inc. (“Tantivy”) filed a Motion to Exclude in this patent infringement matter, alleging that Lucent Technologies, Inc. (“Lucent”) withheld documents and data, misrepresented the existence of documents and data, allowed the destruction of documents, and produced documents for the first time in an expert report.

The documents and data at issue relate to interoperability testing, and had been unsuccessfully pursued by Tantivy in various ways on several occasions. In Septempber, 2004, “Interoperability testing…” had been requested. All documents on the Internet related to Lucent cdma2000 products had also been requested. In November, Bates numbers for documents regarding maintenance and testing procedures delivered to a customer (such documents would address interoperability testing) were requested in interrogatories.

In December, a broad discovery order was issued by the Court requiring the production of all documents and data relevant to claims or defenses involved in this case.

Tantivy discovered references to interoperability testing in Lucent documents and learned from Lucent’s web site that such testing was apparently being performed at Lucent facilities. However, despite Tantivy providing specific references to facilities and documents, in January 2005 Lucent still maintained that it did not know of any related documents.

Beginning in August 2005, 30(b)(6) depositions of Lucent employees revealed that documents related to interoperability testing did in fact exist. Furthermore, it was revealed that Lucent had allowed many of these documents to be destroyed through normal document destruction practices.

On September 13, 2005 Tantivy produced Dr. Rhyne’s Rebuttal Expert Report on Non-Infringement, which contained four documents heavily relied upon by Dr. Rhyne which had never been produced to Tantivy. Tantivy had asked for facts related to Lucent’s contentions of non-infringement, but Lucent’s responses did not reference these documents and Lucent never produced these materials prior to submitting the report. Tantivy thus didn’t have access to these materials until discovery was mostly completed and expert reports had been produced.

The Court held that Lucent violated Fed.R.Civ.P. 26 and the Court’s discovery order by not producing the documents. Also, Lucent’s failure to retain relevant documents allows for a strong adverse inference given that litigants are supposed to suspend routine document destruction and establish litigation holds.

Several explanations were offered by Lucent, but the Court found none of them persuasive. Lucent argued that Dr. Rhyne relied upon documents which Lucent had not previously produced because he was responding to new infringement theories brought by Tantivy and Lucent had no obligation to produce the documents prior to the assertion of these new theories under P.R. 3-4(a). The Court responded that its discovery order exceeded what is required under the Federal Rules and Lucent could have challenged the mandatory disclosure but did not. Furthermore, Lucent had responded to requests for such documents by claiming the documents did not exist, not by claiming that the materials were irrelevant or beyond the scope of P.R. 3-4(a).

Lucent argued that the documents were public and thus did not have to be produced. The Court disagreed, pointing out that one of the disputed documents was in a Lucent publication, written by Lucent employees, and written about Lucent equipment – its public availability is irrelevant and it should have been produced.

This Court will simply not allow lawyers or their clients to lay behind the log and disregard their discovery obligations. Parties have an affirmative obligation in this Court to search for and produce relevant documents early in the case. This includes searching the records of related companies or any other company whereby a party to the litigation has a legal right to the documents. Further, technical document production is not limited solely to P.R. 3-4(a) production. The parties are under an obligation to produce all relevant documents.

Lucent and Lucent’s attorneys behavior in hiding documents, misrepresenting the existence of documents, and allowing the destruction of documents is sanctionable conduct-both as to Lucent and to Lucent’s attorneys.