SAN FRANCISCO--A U.S. appeals court Friday (May 13) found that IP vendor Rambus Inc. wrongly destroyed documents and sent to cases involving Rambus back to lower courts for review, according to reports.
The U.S. Court of Appeals for the Federal Circuit said it was clear that Rambus had destroyed documents, but it was not clear that the destruction was so serious that a lower court should have tossed out a case involving Rambus and Micron Technology Inc., according to a report by the Reuters news service.
The court also found that Rambus destroyed documents related to a successful patent infringement suit against South Korea’s Hynix Semicondcutor Inc. and asked a California court to review the decision in light of the finding of document destruction, according to the Reuters report.
"We are very disappointed with the decisions in these cases," said Thomas Lavelle, senior vice president and general counsel at Rambus, in a statement issued by the company following the ruling.. "We are hopeful when the district courts reconsider these decisions, they will find, as we believe, there was no bad faith and no prejudice."
Rambus said at issue in both cases is when the company reasonably expected litigation. Both district court judges in these matters identified different dates, with the U.S. District Court for the Northern District of California determining Rambus did not engage in bad faith, while the Delaware Court determined that Rambus executed its document retention policy during a time when it reasonably foresaw litigation, Rambus said.
The appeals court said it was not a clear error for the Delaware court to conclude that Rambus' document policy was to further its litigation strategy by frustrating the fact-finding efforts of parties adverse to Rambus, according to the Reuters report.
Hynix and Micron accused Rambus of improperly shredding documents as Rambus laid out plans to sue both companies for infringement, according to the Reuters report. The lower courts were divided on the issue, with Micron winning in Delaware because a judge invalidated 12 Rambus patents, citing the document destruction and Rambus winning against Hynix in a separate California triall, Reuters reported.
"We are pleased that the Federal Circuit panel unanimously agreed with Judge Robinson's decision in Delaware that Rambus wrongfully destroyed evidence," said Rod Lewis, Micron's vice president of legal affairs and general counsel, in a statement issued by Micron. "We believe the record before Judge Robinson provides more than ample support for the Federal Circuit's request for findings regarding Judge Robinson's decision that Rambus acted in bad faith and, therefore, the only appropriate sanction was to declare Rambus' patents unenforceable against Micron."
Reuters reported that trading of Rambus’s stock was halted six times on Friday as the stock hit circuit breakers after rapidly rising and then falling more than 10 percent in a matter of minutes.