ITC Judge Issues Sanctions Against Apple Over Counsel's Misrepresentations

An International Trade Commission administrative law judge has sanctioned Apple Inc. for its counsel’s misrepresentation of facts during an opening statement and in a pre-hearing brief.

On April 24, the same day that Administrative Law Judge Thomas Pender ruled that Apple’s iPad and iPhone had infringed one of Motorola Mobility’s patents related to video game consoles, he imposed sanctions against Apple. He determined that “(1) facts were misrepresented; (2) Respondent’s counsel should have known better; (3) no satisfactory explanation for the misrepresentation exists; and (4) Complainant was harmed by Respondent’s misrepresentation.”

He went on to say, “I am not persuaded by Respondent’s excuses. In what has to be the legal equivalent to ‘the dog ate my homework excuse,’ Respondent blamed its misrepresentation upon a combination of miscommunication with a law firm associate and the press of litigation before the ITC. First, partners are responsible for effective communication with their associates. Secondly, all litigation before the ITC is compressed compared to district courts, but that is known and accepted. Even in combination, Respondent’s proffered excuses are not excuses any judge can ever accept, for if we were to do so, they would swallow accountability.”

Pender found that Apple misrepresented the facts and its intentions, which caused additional confusion, expense, delay “and increased the potential for injustice.”

According to the transcript of the Dec. 8, 2011, opening statement, Matthew Powers of Tensegrity Law Group in Redwood Shores, Calif. made those arguments.

Powers referred questions to Apple. Apple did not respond to a request for comment.

The ruling came in an ITC case captioned In the matter of Certain Wireless Communication Devices, Portable Music and Data Processing Devices, Computers and Components Thereof. 

In that ITC case, Pender ruled that Apple’s iPad and iPhone infringed one of Motorola Mobility’s patents for eliminating noise when someone is speaking or during data transmission. He also issued an order this month that found that one other Motorola Mobility patent was invalid and two patents were not infringed by Apple. The full ITC is expected to issue final orders on both matters this August.

Pender wrote that “the focus of the instant misrepresentation involves the numerous applications that are downloadable to the Accused Apple Products through the Apple App Store.…Boiled down to the essentials, I find the facts…establish Complainant was deceived by arguments made by Respondent and had to exert time and effort to rebut Respondent’s statements concerning the Apple App Store. I also find counsel’s opening statement misrepresented the evidence Respondent proffered and contradicted its own Pre-Hearing brief.”

Pender directed Motorola Mobility to determine the time and expenses it cost to respond to Apple’s position from the date of the pre-hearing brief to the cross-examination of Noble during the hearing, including expert costs. He also directed Motorola Mobility to figure out the time and expense it incurred in responding to his Dec. 15, 2011, order requiring Apple to show why it shouldn’t be sanctioned for it’s opening statement and representations in the pre-trial brief. And he ordered Apple to reimburse Motorola Mobility for “all reasonably incurred expenses.”

Motorola Mobility spokeswoman Becki Leonard said the company “is pleased that the [administrative law judge's] initial determination finds Apple to be in violation of Motorola Mobility’s intellectual property, and look forward to the full commission’s ruling in August. Our commitment to innovation is a primary reason why we are an industry-leader in intellectual property, and our focus continues to be on building on this strong foundation to enhance the user experience.”

Charles Schill, a partner at Steptoe & Johnson LLP of Washington, represented Motorola Mobility.

Sheri Qualters can be contacted at [email protected].

This article originally appeared in The National Law Journal.