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Samsung's Claims of Juror Misconduct Revealed in Unredacted Filings ~pj Updated 2Xs
Tuesday, October 02 2012 @ 11:37 PM EDT

Samsung has now filed an unredacted version [PDF] of its motion for judgment as a matter of law, a new trial, and/or remittitur. That's the one that was originally filed with a redacted section we figured out was about the foreman, Velvin Hogan. The judge ordered it filed unsealed, and so now we get to read all about it.

It's pretty shocking to see the full story. I understand now why Samsung tried to seal it. They call Mr. Hogan untruthful in voir dire (and I gather in media interviews too), accuse him of "implied bias" and of tainting the process by introducing extraneous "evidence" of his own during jury deliberations, all of which calls, Samsung writes, for an evidentiary hearing and a new trial with an unbiased jury as the cure.

Were you wondering how Samsung found out about the lawsuit that Hogan failed to mention in voir dire, the litigation between Seagate and Hogan that Samsung dug up? Apple was, as I'll show you. You wouldn't believe it if it was in a movie script. The lawyer who sued Mr. Hogan on behalf of Seagate back in 1993 is now married to a partner at Quinn Emanuel, the lawyers for Samsung.

What are the odds?

And did you read in Reuters [PDF, the B part] the story Hogan told about that litigation? Samsung shows that his story to Reuters is not the way it was in real life. There are, of course, materials in support, and they too are now unsealed.

The filings, first:

2012 - Filed & Entered: 10/01/2012
Declaration in Support
Docket Text: Declaration of Susan R. Estrich in Support of [1819] Samsung's Motion for Judgment as a Matter of Law, New Trial, and/or Remittitur Pursuant to Federal Rules of Civil Procedure 50 and 59 filed bySamsung Electronics America, Inc., Samsung Electronics Co. Ltd., Samsung Telecommunications America, LLC. (Attachments: # (1) Exhibit)(Estrich, Susan) (Filed on 10/1/2012) Modified on 10/2/2012 linking entry to document #1819 (dhmS, COURT STAFF).

2013 - Filed & Entered: 10/02/2012
Notice (Other)
Docket Text: NOTICE by Samsung Electronics America, Inc.(a New York corporation), Samsung Electronics Co. Ltd., Samsung Telecommunications America, LLC re [2009] Order on Administrative Motion to File Under Seal Samsung's Rules 50 and 59 Motion; Estrich Declaration in Support; Exhibits A-O to the Estrich Declaration; Exhibits 13 and 18 to the Pierce Declaration (Un-redacted) (Attachments: # (1) Declaration of Susan Estrich in Support of Samsung's Rules 50 and 59 Motion, # (2) Exhibit A to the Estrich Declaration, # (3) Exhibit B to the Estrich Declaration, # (4) Exhibit C to the Estrich Declaration, # (5) Exhibit D to the Estrich Declaration, # (6) Exhibit E to the Estrich Declaration, # (7) Exhibit F to the Estrich Declaration, # (8) Exhibit G to the Estrich Declaration, # (9) Exhibit H to the Estrich Declaration, # (10) Exhibit I to the Estrich Declaration, # (11) Exhibit J to the Estrich Declaration, # (12) Exhibit K to the Estrich Declaration, # (13) Exhibit L to the Estrich Declaration, # (14) Exhibit M to the Estrich Declaration, # (15) Exhibit N to the Estrich Declaration, # (16) Exhibit O to the Estrich Declaration, # (17) Exhibit 13 to the Pierce Declaration, # (18) Exhibit 18 to the Pierce Declaration)(Estrich, Susan) (Filed on 10/2/2012)

Exhibit A to 2013 is the Seagate v Hogan complaint filed in 1993 by Seagate, and Exhibit B is the bankruptcy filing. Seagate filed a claim in that bankruptcy. Note that Seagate did a kind of deal with Samsung in 2011 (see Exhibit C [PDF]), buying the hard drive unit and Samsung becoming a major shareholder in Seagate, in fact the largest single shareholder in Seagate, and I would suspect that Samsung's thinking is that Mr. Hogan might have a teensy bug up his nose about Samsung as a result of that connection to Seagate.

The issue, then, is juror misconduct, not that they just didn't know what they were doing during deliberations. Hogan did not mention the case brought against him by Seagate in voir dire, significantly enough, even though he was specifically asked by the judge, as were all the prospective jurors, to list all cases any of them was ever involved in as a witness or a party. Hogan told Reuters (see 2012 [PDF]) that he wasn't asked about all cases. But he was, as you can see for yourself in the transcript [PDF] of the voir dire. If he was on a crusade to get back at Seagate/Samsung, he might logically not wish to reveal this litigation, knowing he'd likely be cut from the jury. One has to wonder if he always tells the truth, the whole truth and nothing but the truth. Did he fail to answer fully and truthfully because he was so eager to be on the jury? If he had revealed the Seagate issue, no doubt Samsung would have objected to him being on the jury. As Samsung points out, there is a case, United States v. Colombo [PDF], that held that "A juror’s failure to answer truthfully also may constitute a 'prejudicial impairment' of a party’s 'right to the exercise of peremptory challenges.'” So Samsung was robbed of that opportunity.

Let me show you Samsung's unredacted section in full on juror misconduct, because that is exactly what they say:

I. JUROR CONDUCT REQUIRES A NEW TRIAL

A new trial is warranted based on a finding of implied bias if a juror “lies materially and repeatedly in response to legitimate inquiries,” and a court should “presume bias where a juror lies in order to secure a seat on the jury.” Dyer v. Calderon, 151 F.3d 970, 982 (9th Cir. 1998) (en banc). “Statements which tend to show deceit during voir dire are not barred by [Fed. R. Evid. 606(b)(1)].” Hard v. Burlington N. R.R., 812 F.2d 482, 485 (9th Cir. 1987). A juror’s failure to answer truthfully also may constitute a “prejudicial impairment” of a party’s “right to the exercise of peremptory challenges.” United States v. Colombo, 869 F.2d 149, 151 (2d Cir. 1989); see United States v. Gonzalez, 214 F.3d 1109, 1114 (9th Cir. 2000).

The jury foreman, Velvin Hogan, failed to answer truthfully during voir dire. Asked by the Court whether “you or a family member or someone very close to you [has] ever been involved in a lawsuit, either as a plaintiff, a defendant, or as a witness?” (Reporter’s Transcript (“RT”) 148:18-21), he disclosed one such lawsuit but failed to disclose two others, including one in which he was sued by his former employer, Seagate, for breach of contract after he failed to repay a promissory note (RT 148:22-150:12; Seagate Tech., Inc. v. Hogan, Case No. MS-93-0919 (Santa Cruz Mun. Ct. June 30, 1993), Declaration of Susan Estrich (“Estrich Decl.”) Ex. A), and filed for personal bankruptcy six months later (In re Velvin R. Hogan and Carol K. Hogan, Case No. 93-58291-MM (Bankr. N.D. Cal. Dec. 27, 1993); Estrich Decl., Ex. B). Samsung has a substantial strategic relationship with Seagate (Estrich Decl. Ex. C), which culminated last year in the publicized sale of a division to Seagate in a deal worth $1.375 billion, making Samsung the single largest direct shareholder of Seagate (id. Exs. D-G). The attorney who sued Mr. Hogan on Seagate’s behalf is the husband of a Quinn Emanuel partner. Id. ¶3. Mr. Hogan’s failure to disclose the Seagate suit raises issues of bias that Samsung should have been allowed to explore in questioning and that would have triggered a motion to strike for cause or a peremptory strike.

Moreover, Mr. Hogan’s public statements suggest that he failed to answer the Court’s question truthfully “in order to secure a seat on the jury,” in which case bias is presumed, Dyer, 151 F.3d at 982-83 (“The individual who lies in order to improve his chances of serving [on a jury] has too much of a stake in the matter to be considered indifferent.”). He stated he “expected to be dismissed from the jury because of [his] experience” and was “grateful” to be selected (Estrich Decl. Ex. H), and that, “[e]xcept for my family, it was the high spot of my career. You might even say my life.” Id., Ex. I. During voir dire, Mr. Hogan remained silent when asked if he had “strong feelings or strong opinions about either the United States patent system or intellectual property laws” (RT 167:1-6) and would be able to follow the Court’s instructions “even if it may not completely correspond to what you may know about the patent system or the intellectual property laws.” RT 159:25-160:11; 165:13-18. After the verdict, however, he said he wanted to be satisfied that the verdicts “protected copyrights and intellectual property rights” in order “to send a message to the industry at large that patent infringing is not the right thing to do” and “make sure the message we sent was not just a slap on the wrist.” Estrich Decl. Exs. I, J. K.

Finally, Mr. Hogan’s self-reported conduct during the jury deliberations presents the “reasonable possibility” that extraneous material “could have affected the verdict.” Sea Hawk Seafoods, Inc. v. Alyeska Pipeline Serv. Co., 206 F.3d 900, 906 (9th Cir. 2000). In post-verdict interviews with the media, Mr. Hogan said that he told his fellow jurors an accused device infringes a design patent based on “look and feel” (Estrich Decl. Ex. N), that an accused device infringes a utility patent unless it is “entirely different” (id. Ex. M), that a prior art reference could not be invalidating unless that reference was “interchangeable” (id. Exs. L, N), and that invalidating prior art must be currently in use (id. Ex. O). These incorrect and extraneous legal standards had no place in the jury room. See Hard, 812 F.2d at 485; Gibson v. Clanon, 633 F.2d 851, 853, 855 (9th Cir. 1981); United States v. Perkins, 748 F.2d 1519, 1530-33 (11th Cir. 1984); Casanas v. Yates, 2010 WL 3987333, at *6 (N.D. Cal. Oct. 12, 2010) (approving for cause dismissal where juror “was applying his experience to question the law, not using his experience to determine the facts”).

For all these reasons, Mr. Hogan’s conduct during voir dire and jury deliberations must be fully examined in a hearing with all jurors and can be cured only by a grant of new trial.

Reuters' Alison Frankel reported that Hogan claimed (see #2012 [PDF], p. 2, paragraphs 4 and 5 and Exhibit B, that he'd sued Seagate for fraud and then Seagate countersued:
In an exclusive interview Tuesday about Samsung's secret new allegations, Hogan, an engineer, confirmed that he was a party in two cases cited in Samsung's brief, a 1993 case from municipal court in Santa Cruz titled Seagate Technology v. Hogan and a 1993 federal bankruptcy case titled In re Velvin R. Hogan. According to Hogan, when Seagate hired him in the 1980s and he moved from Colorado to California, his new employer agreed to split the cost of paying off the mortgage on his Colorado home. But after Hogan was laid off in the early 1990s, he told us, Seagate claimed he owed the company that money. Hogan said he sued Seagate for fraud, Seagate countersued, and he ultimately declared personal bankrupty to protect his house.
The materials Samsung filed do not include any confirmation of any such tale, and instead show that it was Seagate that brought the action, with a claim for breach of contract by Hogan. On page 32 of Exhibit B to #2013, the bankruptcy materials, the filing describes the reason for the claims filed by Seagate against Hogan like this:
On or about April 19, 1992, defendant breached the agreement by the following acts: Failure to repay plaintiff the principal sum of $25,000.00, together with accrued interest thereon, within 270 days of defendant's termination of employment with plaintiff which occurred on or about July 19, 1991.
Seagate was claiming damages of the principal sum of $25,000 plus prejudgment interest at the "agreed rate" of ten percent, from July 19, 1991 to the filing of the lawsuit. Agreed in what sense? On page 33, you see the actual 1989 agreement, whereby Hogan agreed to pay Seagate those sums in the event his employment was terminated, which it was. During his employment, it was a loan, and he only paid a portion of bonuses received each year to payment of principal and any interest. He filed for bankruptcy instead of paying Seagate back, after his employment was terminated. There is no sign of any issue of fraud being raised. Nor was the loan tied to any Colorado house, at least it's not mentioned in the loan agreement.

That's a strange way to get a house. Of course he owed more than $25,000 on the house in California he had bought, and looking at the forms, it looks like that debt to a company named Corstan is also listed in the bankruptcy.

The parties' lawyers have been in communication about all this, the charge of juror misconduct, with one email from Apple indicating they wonder if Samsung preserved arguments concerning juror misconduct. Samsung in #2012 therefore says this:

3. In response to Samsung’s motion detailing Velvin Hogan’s failure to reveal his litigation with Seagate during voir dire and its impact on the integrity of the trial and the verdict, Apple demanded that Samsung disclose the timing of its knowledge regarding those facts. A true and correct copy of Apple’s email, along with further correspondence between counsel for the parties that resulted in Apple’s agreement that any such disclosures would not constitute a waiver of any privilege, is attached hereto as Exhibit A. By way of separate declaration, Samsung is confirming to Apple that it did not know of Mr. Hogan’s undisclosed litigation against Seagate until after the verdict. To date, Apple has not revealed whether it was aware of Mr. Hogan’s litigation against Seagate prior to the verdict or prior to Samsung’s Motion.
This exhibit [PDF] is where you can find the emails between the parties' lawyers in the first part, Exhibit A. One thing is clear. These lawyers dislike each other, or at least they are playing serious hardball. Note Apple refusing to give Samsung until Friday AM after Yom Kippur, insisting they must receive by Thursday noon "a sworn declaration from Samsung disclosing how and when it learned of the facts underlying its allegation that the judicial process was tainted". That gave Samsung just that morning to get it all pulled together. I assume Apple is asking when Samsung learned about the Seagate v. Hogan case because of Samsung stating in the JMOL: "The attorney who sued Mr. Hogan on Seagate’s behalf is the husband of a Quinn Emanuel partner." (See Declaration of Susan R. Estrich, paragraph 3: "Diane M. Doolittle, a partner in the Silicon Valley office of Quinn Emanuel Urquhart & Sullivan, LLP, is married to Michael F. Grady, the attorney who filed the complaint, Exhibit A, against Velvin Hogan on behalf of Seagate.")

So that is how they found out. But the operative question is, when?

What does all this mean? It means that this claim by Samsung isn't about jury thought processes, the kind of issue that the judge mentioned as being not something that can be questioned. This is instead about juror *misconduct*, which absolutely is the kind of thing that can undo jury verdicts. There have been a couple of those just this week that I put in News Picks.

Samsung is accusing Hogan of the voir dire failure but it also says that the jury "improperly considered extraneous evidence during deliberations" -- which is about Hogan's Aha moment and that he misstated the law about prior art. So we were on target at Groklaw to highlight that.

If Hogan was on a mission to get back at Seagate, obviously that could tie in to why he felt so urgent about coming up with an aha moment, after the first day's deliberations when he felt, or so he told the media, that the jury was going to go Samsung's way. I think you can see how these two issues could indeed be related to the verdict. I don't know if they are or not; nor do I know if the judge will find it so. But I know she ought to have a hearing to get to the bottom of it. My question, I confess, is will answers to questions be truthful? I suppose that is why Samsung says the only real cure is a new trial.

Many of the rest of the exhibits to #2013 are media interviews with Hogan. Interestingly, comments to the articles are included. All I can say is, if you ever comment on an online legal news story, think before you write, because you may go down in history.

And finally, the now-unredacted Exhibit 18 [PDF] to the Pierce Declaration is a letter from Apple to Samsung back in May, claiming that it was already licensed to Samsung's FRAND patents, even though they hadn't yet agreed to a price and hadn't paid anything at all. Some license that is. Apple is following in Microsoft's FRAND footsteps, and they both are marching to the same drummer, that the license is more or less automatically in place as soon as either of them wants it to be, and the price can be worked out post-license. Of course, Samsung disagrees, as does Motorola, but so far some courts seem to be going along with the argument, which is deeply puzzling, in that a contract that includes monetary terms can't really be in place, unless I missed something in school, without consideration and both sides agreeing to the terms. So I expect to see a lot more on this theme in appeals.

Update: Joe Mullin at ars technica highlights one other point from Samsung's juror misconduct arguments that is significant but that I failed to mention specifically:

Samsung also suggests that Hogan didn't disclose how pro-patent he was when asked in court whether he had "strong feelings" about the U.S. patent system. The new motion argues that Hogan's silence didn't sync up with his later statements to The Verge that "except for my family, it [jury service] was the high point of my career... you might even say my life," and that he wanted to be satisfied "that this trial was fair, and protected copyrights and intellectual property rights, no matter who they belonged to."
And Bloomberg has asked Mr. Hogan about the charges, and he again tells the story about a 10-year limit to the judge's question. Does he not realize that courts do transcripts? Or is he hoping he can excuse his conduct as a misunderstanding? Here's what Bloomberg reports:
Hogan, in a phone interview yesterday, denied that there was any misconduct, saying the court instructions for potential jurors required disclosure of any litigation they were involved in within the last 10 years -- and that the 1993 bankruptcy and related litigation involving Seagate fell well outside that time range.

“Had I been asked an open-ended question with no time constraint, of course I would’ve disclosed that,” Hogan said, referring to the bankruptcy and related litigation. “I’m willing to go in front of the judge to tell her that I had no intention of being on this jury, let alone withholding anything that would’ve allowed me to be excused.”

Hogan said once he was selected as a juror he “took it as an honor” because the suit was related to his job as an electrical engineer, which he’s done for almost 40 years.

“I answered every question the judge asked me” and Samsung “had every opportunity to question me,” Hogan said. He added that he’s surprised Samsung didn’t know about the history it’s now citing given the relationship the lawyer Samsung refers to in its filing has with another lawyer at Quinn Emanuel Urquhart & Sullivan LLP, the firm representing the company.

Hogan said yesterday’s filing has him wondering whether Samsung “let me in the jury just to have an excuse for a new trial if it didn’t go in their favor.”

I see. It's all Samsung's fault. But he's not biased. My bogometer is ringing off the wall. Perhaps I may be excused for assuming from his response that Apple has now contacted Mr. Hogan?

In any case, he was asked an open-ended question. He was asked by the judge to tell her about any litigation he had *ever* been involved in, as a party or a witness. And given that he knows about the charges, I think he has to know that by now, which makes his answer rather questionable.

The trouble with not telling the whole truth is that later when you tell people some new things, they may not believe you.

Here's precisely what he was asked, as evidenced by the transcript of voir dire:

THE COURT: Okay. Welcome back. Please take a seat. We had a few more departures in your absence. Let's continue with the questions. The next question is, have you or a family member or someone very close to you ever been involved in a lawsuit, either as a plaintiff, a defendant, or as a witness?
Open-ended as the wind.

Update 2: To test Hogan's claim that the jury was only asked about the last ten years, I went back to the transcript, the full PDF itself, and I note one juror gives the lie to that claim, because in answering the same question from the judge, he or she mentioned a 1998 case:

PROSPECTIVE JUROR: YES. BACK IN 1998, I HAD A SURGERY. I DIDN'T HAVE INSURANCE. I WAS PURSUED BY THE DOCTOR AND I WENT TO THE JUDGE AND WE AGREED TO -- I AGREED TO PAY THE FEES IN INSTALLMENTS. THAT'S ALL I HAVE.
Even if it were true, which I doubt, that he thought he was being asked only about ten years of time, when that answer happened, he would have had reason to understand that the question was not about only ten years but included the '90s as well, and in fact ever.

By the way, there is a reason why judges ask this question, and it too gives the lie to the idea that a judge would only be interested in ten years. I'll show you how the judge explained it to this jury pool, from the transcript again:

THE COURT: ALL RIGHT. AND THIS IS FOR EVERYONE. WE'LL TALK FURTHER ABOUT WHO'S BEEN ON JURY DUTY, BUT THERE ARE DEFINITELY DIFFERENT, YOU KNOW, STANDARDS OF PROOF IN DIFFERENT CASES, AND I JUST WANTED TO MAKE SURE -- YOU ALL HAD CIVIL CASES, SO I WOULD ASSUME THAT YOU ALSO HAD, YOU KNOW, PREPONDERANCE OF THE EVIDENCE. DOES THAT SOUND FAMILIAR? AND WE'LL TALK ABOUT THIS A LITTLE BIT LATER ON, BUT IN DIFFERENT TYPES OF CASES, THERE MAY BE DIFFERENT STANDARDS OF PROOF, AND ALSO THE LAW MAY HAVE CHANGED SINCE WHENEVER YOU WERE A LITIGANT. SO I WANT TO MAKE SURE THAT BOTH MR. HOGAN, AND MS. ROUGIERI, THAT YOU WOULD APPLY THE LAW AS I INSTRUCT YOU AND NOT BASED ON YOUR UNDERSTANDING OF THE LAW BASED ON YOUR OWN CASES. FIRST ROW?

IS THAT CORRECT, MR. HOGAN?

PROSPECTIVE JUROR: YES.

The judges are interested in all cases, because, as she explained -- even asking Hogan if he understood it -- the law doesn't stand still. Even if his experience in a civil case was remembered perfectly, what he learned about the law could have changed since or it could be a matter with a different standard of proof.

So, for example, when he explained to his fellow jurors about his experience in getting his own patents through the approval process at the USPTO, that was about a decade ago. The law has changed since, so whatever he learned, it's not proof about how the law is today, and yet, after telling the judge "Yes", he understood, he did exactly what he said he would not do.


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