Jennifer Milici, D.C. Bar No. 987096

Daniel Matheson, D.C. Bar No. 502490

J. Alexander Ansaldo, Va. Bar No. 75870

Joseph R. Baker, D.C. Bar No. 490802

Elizabeth A. Gillen, Ca. Bar No. 260667

Federal Trade Commission

600 Pennsylvania Avenue, N.W.

Washington, D.C. 20580

Tel: (202) 326-2912; Fax (202) 326-3496

jmilici@ftc.gov

Lin W. Kahn, Ca. Bar No. 261387

Federal Trade Commission

901 Market Street, Suite 570

San Francisco, CA 94103

Tel: (415) 848-5115; Fax: (415) 848-5184

lkahn@ftc.gov

Attorneys for Plaintiff

FEDERAL TRADE COMMISSION

CRAVATH, SWAINE & MOORE LLP

Gary A. Bornstein (pro hac vice) 

gbornstein@cravath.com

Yonatan Even (pro hac vice)

yeven @cravath.com

825 Eighth Avenue

New York, NY 10019-7475

Telephone: (212) 474-1000

Facsimile: (212) 474-3700

 KEKER VAN NEST & PETERS LLP

 Robert A. Van Nest

 rvannest@keker.com

 633 Battery Street

 San Francisco, CA 94111-1809 Telephone: (415) 676-2289 Facsimile: (415) 397-7188

 MORGAN, LEWIS & BOCKIUS LLP Richard S. Taffet (pro hac vice) richard.taffet@morganlewis.com

 101 Park Avenue

 New York, NY 10178-0060 Telephone: (212) 309-0060 Facsimile: (212) 309-6001

 MORGAN, LEWIS & BOCKIUS LLP

 Donn P. Pickett (SBN 72257)

 Donn.pickett@morganlewis.com

 Geoffrey T. Holtz (SBN 191370)

 Geoffrey.holtz@morganlewis.com

 One Market, Spear Street Tower

 San Francisco, CA 94105-1596 Telephone: (415) 442-1000 Facsimile: (415) 442-1001

 Attorneys for Defendant

 QUALCOMM INCORPORATED

 

 Additional Counsel listed on the Signature 

 Page

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

FEDERAL TRADE COMMISSION

 Plaintiff, v.

QUALCOMM INCORPORATED,

a Delaware corporation,

 Defendant

Case No. 5:17-cv-00220-LHK-NMC

PLAINTIFF FEDERAL TRADE 

COMMISSION AND DEFENDANT 

QUALCOMM INCORPORATED’S JOINT 

DISCOVERY STATEMENT REGARDING 

ASSERTION OF PRIVILEGE

Magistrate Judge: 

Hon. Nathaniel M. Cousins

Plaintiff Federal Trade Commission (“FTC”) and Defendant Qualcomm Incorporated 

(“Qualcomm”) hereby submit this joint statement. The parties have met and conferred by 

telephone, but have been unable to reach agreement on the issues addressed herein.
1 

I. The FTC’s Position

This dispute arises out of Qualcomm’s assertion of privilege over a database of certain 

metrics Qualcomm uses to classify the perceived technical merit and relative values of 

intellectual property. These metrics, referred to as “ratings,” are used by business personnel to 

make business decisions: for example, the data sought by this motion is presented to 

Qualcomm’s Chief Technology Officer during periodic meetings held to 

, and the data is considered by Qualcomm executives in connection with 

. See infra. 

Qualcomm cannot carry its burden of showing that this data is privileged, because 

disclosing the data would not reveal the content of a confidential communication between an 

attorney and her client. Data relevant to the value of a business’s assets, which is accessed for 

business purposes, cannot be withheld on the grounds that the same data is used by lawyers to 

render legal advice. Nor can it be withheld based on an assertion that the valuation is influenced 

in part by legal advice. A contrary result would flout controlling precedent and allow businesses 

to conduct their affairs in secret: a company’s view of the value and boundaries of its real estate 

assets would be secret if based in part on a lawyer’s view regarding clarity of title or liability for 

environmental damage; and a company’s assessment of the strength and scope of intellectual 

property would be secret if based in part on a lawyer’s view regarding the likely outcome of 

patent proceedings or future litigation. This would contradict the maxim that the attorney-client 

privilege “ought to be strictly confined within the narrowest possible limits consistent with the 

logic of its principle.’” United States v. Ruehle, 583 F.3d 600, 607 (9th Cir. 2009). 

A. Qualcomm’s Patent Ratings Data Are Based on an Idea’s “Technical Merit”

and Used for Non-Privileged Business Purposes

Qualcomm Senior Vice President Baaziz Achour explained at his deposition

Each “Patent Review Board” consists of 

. The ratings are driven by technical 

merit, not legal analyses. Id. at 425:13-18. That the ratings are technology-centric is confirmed 

by Qualcomm’s formation of multiple, different Patent Review Boards across different technical 

areas of Qualcomm’s engineering operations (e.g., the modem group). Id. at 417:2-9, 418:13-16. 

Sworn testimony and documentary evidence shows the database containing ratings data is 

available for – and used by – various executives within Qualcomm’s management team. E.g., 

Achour Dep. Tr. at 411:19-412:13, 412:25-413:5, 414:2-8; Martin Dep. Tr. at 558:6-11, 60:20-

61:6, 94:19-95:14; Q2014FTC04774115 at 1-2 (Qualcomm’s CTO, Mr. Grob, when asked “Do 

we have fundamental/killer IPR in 802.11 vs other key players[,]” responded “best to ask patent 

group / Roger Martin those questions – they have the compilation of data like that”) (emphasis 

added). Qualcomm has not established that the primary purpose for which these executives use 

this information relates to legal advice. To the contrary, the evidence shows the rating 

information in the database is used for business purposes. 

Specifically, Qualcomm’s Strategic IP Department (“Strat IP”) created the ratings in part 

for use by Qualcomm’s licensing business unit (“QTL”). Martin Dep. Tr. at 37:14-17; see also 

id. at 65:5-8, 86:15-19. QTL uses the ratings to assess

 

1

 The FTC is happy to provide the deposition transcripts and documents cited herein upon request.
2 

Hence, these ratings and metrics are business tools, and are fairly discoverable.

2

Qualcomm’s use of ratings data in this context precisely aligns with TCL Communication 

Technology Holdings Ltd. v. Telefonaktenbologet LM Ericsson, No. 14–cv–341, 2016 WL 

6921124 (C.D. Cal. May 3, 2016), in which the Court ordered Ericsson to provide discovery on 

the “Relevancy Rankings” of its standard-essential patents. Just like Qualcomm, Ericsson argued 

that in-house attorneys had a primary role in assigning the ratings and that the ratings aided in 

patent prosecution efforts.3 TCL, 2016 WL 6921124, at *2; see also Ex. 1 (TCL Magistrate Judge 

Order) at 4. But the Court rejected this argument, because the Relevancy Rankings contained 

“information that [is] used for management purposes,” including “how [Ericsson] value[s] the 

different patents” and “this value is intended to govern future investments in those patents.” Ex. 

1 at 3. Inevitably, how Ericsson valued the different patents incorporated its attorneys’ views on 

patent validity and enforceability, but that happenstance could not protect the Relevancy 

Rankings, because the Court concluded “that the primary purpose of the [Relevancy Rankings] is 

not legal advice.” Id.; see also TCL, 2016 WL 6921124, at *3. 

This Court should reach the same conclusion. Just as in TCL v. Ericsson, the rating 

system developed by Strat IP is a tool used for business purposes. For example,

. Qualcomm argues that Mr. Martin and other 

attorneys within Strat IP do not formulate views on patent monetization. But that is precisely the 

point: Strat IP creates an assessment based on an idea’s technical merit and commercial 

importance, and QTL uses that data to make business decisions.

Accordingly, even if Qualcomm’s ratings and metrics were solely used to identify the 

highest value intellectual property, the ratings still would not constitute legal advice. See 

SanDisk Corp. v. Round Rock Research, No. 11–cv–5243, 2014 WL 691565, at *3 (N.D. Cal. 

Feb. 21, 2014) (holding IP valuation documents not privileged where purpose was to analyze a 

potential licensing target, not primarily legal advice). Nor does the fact that one use of the ratings 

is to inform legal decisions transform the ratings into legal advice. Cf. United States v. Richey, 

632 F.3d 559, 567 (9th Cir. 2011) (appraisal for an IRS submission not privileged where it was 

made “for the purpose of determining the value of the Easement”).

B. Qualcomm Cannot Withhold Its Patent Ratings and Metrics Because 

Qualcomm Intends to Offer Evidence of the Value of Its Patents at Trial

Qualcomm’s Rule 26 Disclosures make clear that Qualcomm intends to offer evidence at 

trial that Qualcomm’s royalty rates are reasonable in light of the value of Qualcomm’s 

contributions to cellular technologies, listing multiple Qualcomm witnesses who may testify on 

this topic. Qualcomm witnesses have indeed testified that Qualcomm has made valuable 

 

2 Qualcomm argues that the FTC has not shown these ratings were primarily used for business purposes. 

But it is Qualcomm’s burden to show that the primary purpose of the ratings was legal advice. TCL, 2016 

WL 6921124, at *5. Qualcomm has not done so. At best, the evidence is conflicting. Compare

Q2014FTC04774115 at 1-2 (noting the patent group maintains data to compare IPR to competitors) with 

infra note 6 (citing attorney declaration stating the data is not used for such purposes). Furthermore,

Qualcomm claims privilege over the potentially relevant evidence. See, e.g., Mar. 28, 2018 Ltr. from 

James Carlson (clawing back QNDCAL04937515 to redact a discussion about Samsung’s “IP strength”). 

3 Here, Qualcomm cites declarations and an interrogatory response making similar statements regarding 

how the assessments are used for patent prosecution and litigation strategies. See infra.
3 

contributions to such technologies, which are monetized in the form of Intellectual Property 

Rights (“IPR”). See Grob Dep. Tr. at 150:8-151:17 (testifying Qualcomm has an “extensive 

portfolio of IP that relates to LTE” and that Qualcomm’s IP has “value” and is “high quality”). 

In order to probe the bases for these claims, the FTC needs access to the data relied on by 

Qualcomm’s business personnel to make business decisions related to the technical merits of its 

intellectual property. The Court has not “previously addressed” this issue: the only issue 

presented to the Court in connection with Mr. Martin’s Declaration (ECF No. 279) was one slide 

that Mr. Martin insisted was “prepared at the request of” Qualcomm’s General Counsel “so that 

he could provide legal advice.” ECF No. 279 at 1. The Court had no occasion to consider the 

privilege status of the underlying data relied on by Qualcomm’s business executives.4

Accordingly, the FTC asks that Qualcomm immediately produce the contents of its patent 

rating database, and any related documents concerning its patent-related ratings and metrics 

which Qualcomm has withheld. In addition, Qualcomm should be ordered not to instruct 

witnesses to refuse to answer related questions during depositions, and Qualcomm should 

reproduce witnesses who have refused to answer questions on this topic at past depositions. 

II. Qualcomm’s Position

A. The Patent Ratings Reflect Attorneys’ Judgments and Are Used for Legal 

Purposes. 

The FTC’s argument that Qualcomm’s patent ratings are not privileged is based on at 

least two significantly erroneous premises: (1) that Qualcomm’s internal patent ratings are 

created by non-legal personnel and reflect “technical” rather than legal judgments, and (2) that 

the patent ratings are primarily used for business purposes. The FTC’s motion disregards 

extensive evidence contradicting these premises, including a verified interrogatory response and 

sworn declarations by two Qualcomm IP lawyers who have overseen its patent ratings systems. 

Instead, the FTC relies on deposition testimony of a witness who disclaimed personal knowledge 

of the relevant facts and on mischaracterizations of Qualcomm documents. Both of the FTC’s 

premises are wrong, and the ratings are privileged. 

First, the patent ratings assigned to Qualcomm’s patents and patent applications (whether 

as color codes or numerical) are assigned by IP lawyers and reflect legal analyses. As Roger 

Martin, Qualcomm’s then Chief IP Strategist, explained in the declaration he submitted in 

connection with a prior FTC motion opposing the clawback of an analysis reflecting 

Qualcomm’s patent ratings, Qualcomm IP attorneys assigned “color” ratings to patents or patent 

applications based on 

Qualcomm attorneys also have assigned numerical ratings to patents; a subset of those 

numerical ratings was determined by Qualcomm’s outside counsel, whereas the remainder were 

determined by Qualcomm attorneys in its IP Department. (Resp. to Interrogatory No. 2 at 13-16 

(“Resp. No. 2”).) And although the criteria used to rate patents has evolved, those criteria 

themselves were developed by Qualcomm IP attorneys to accomplish legal purposes. (Id.) 

 

4 Qualcomm implies the Southern District of California has ruled that this data is not used to value patents

(and is therefore privileged). In fact, however, that court held only that the data was not called for by 

Apple’s interrogatories, and specifically declined to rule on whether the data was protected by privilege. 

Order (ECF No. 381), No. 17-cv-00108 (S.D. Cal. Mar. 20, 2018) (“[T]he Court will not rule on whether 

the rating system properly is the subject of attorney-client privilege or work-product protection.”).
4 

The FTC’s reference to Qualcomm’s Patent Review Boards (“PRBs”) is a red herring. 

The PRBs do not determine patent ratings. 

 To erroneously 

claim that PRBs assign patent ratings based on an invention’s “technical merit” instead of legal 

analyses, the FTC relies exclusively on testimony by Dr. Baaziz Achour, an engineer who leads 

Qualcomm’s modem development efforts, but who takes no part in PRBs or in patent ratings. 

Indeed, Dr. Achour repeatedly testified that he was not involved in rating patents, did not even 

know what his own patents had been rated, did not know who the members of the PRBs are, and 

had not so much as interacted with any PRB in “15 years”. (Achour Tr. at 411:7-18; 415:7-11; 

416:16-23; 420:17-22.) In any event, it is well-settled that technical discussions with lawyers 

concerning patent and patentability issues, like those that occur in connection with the PRBs, are 

privileged. In re Spalding Sports Worldwide, Inc., 203 F.3d 800, 805 (Fed Cir. 2000); 

Games2U, Inc., v. Game Truck Lic., LLC, 2013 WL 4046655, *3 (D. Ariz. Aug. 9, 2013); see 

also California Inst. of Tech. v. Broadcom Ltd., No. CV 16-3714-GW (AGRX), 2018 WL 

1468371, at *3 (C.D. Cal. Mar. 19, 2018) (“The fact that attorneys on [a Patent Review 

Committee] required engineers or technical experts to assist them in evaluating the invention for 

purposes of determining whether to pursue a patent does not disqualify [a submission to the 

Committee] from being covered by the attorney client privilege.”).

Second, the evidence demonstrates that ratings are primarily used for legal purposes: to 

develop patent prosecution and litigation strategies, including to assess the suitability of patents 

for assertion in litigation. (E.g., Resp. No. 2 at 12-13, 15; ECF No. 279 at 7; Wadryzk Decl. at 

3-5, 8.) The FTC’s assertion that the evidence on this issue is “at best, conflicting” is based on 

mischaracterizations of the documents and testimony it cites. For example, the cited testimony 

by Mr. Martin shows that members of the IP Department, not Qualcomm’s management team, 

can access the database containing information about Qualcomm’s patents; and that only on 

certain occasions has he provided ratings-related information to QTL. (Martin Tr. at 37:3-18; 

61:4-6; 94:9-95:14.) Importantly, no QTL witness has suggested that ratings were used in 

license negotiations, and, contrary to the FTC’s assertion, the ratings are not an attempt to 

“monetize” Qualcomm’s patent portfolio. (Id. at 36:14-20 (“I haven’t spent any time trying to 

think about relationships between color codes and monetary value to Qualcomm.”); see also 

Resp. No. 2 at 16; Wadrzyk Decl. at ¶ 10.)5

 Finally, the FTC suggests that ratings are used at 

R&D meetings “to evaluate research and development projects”, but the cited testimony by 

Dr. Achour was only that ratings were “sometimes mention[ed]” at those meetings. (Achour 

Tr. at 411:19-412:9.) That does not a primary purpose make. Even if legal advice may assist the 

evaluation of a potential business transaction, like an acquisition or a corporate restructuring, 

 

5 The FTC refers to several documents generally concerning the IP Department, but none of the cited 

documents, including the clawed-back document the FTC refers to, concern patent ratings, and ratings are 

not used to compare Qualcomm’s portfolio to others’ (Wadzryk Decl. ¶ 9). Qualcomm does not claim 

that all of the IP Department’s documents are privileged, and has in fact produced responsive, nonprivileged IP Department materials. The issue here is limited to a specific set of information—the patent 

ratings—and the documents cited by the FTC do not relate to them. The FTC’s suggestion that 

Qualcomm “claims privilege over the potentially relevant evidence” is wrong; Qualcomm has provided 

extensive information concerning the nature and purposes of the ratings. Qualcomm will provide any of 

the documents to the Court upon request. 
5 

“advice on transactional matters” is “just the sort of lawyerly thing one would expect of an inhouse lawyer”. Exxon Mobil Corp. v. Hill, 751 F.3d 379, 382 (5th Cir. 2014). 

The TCL decision, relied upon by the FTC, confirms that Qualcomm’s patent ratings are 

privileged. In TCL, unlike in this case, Ericsson’s witnesses testified that its ratings were “used 

for management purposes, such as how we value the different patents”. (Ex. 1 at 3.) Further, 

Ericsson refused to provide any information concerning “what factors influence” its ratings. The

court therefore was unable to conclude that the ratings reflected Ericsson attorneys’ legal 

judgments or served primarily a legal purpose. (Ex. 1 at 4.) Here, Qualcomm has offered two 

declarations and an extensive interrogatory response establishing the legal purpose and content 

of the patent ratings.6

 The FTC simply chooses to disregard such evidence. 

B. Qualcomm Does Not Rely on the Privileged Ratings in This Litigation. 

Privilege is not waived unless a party places the privileged information itself at issue. 

Rock River Comms. v. Universal Music Group, 745 F.3d 343, 353-54 (9th Cir. 2014); Dukes v. 

Wal-Mart Stores, Inc., No. 01-cv-2252 CRB (JSC), 2013 WL 1282892, at *6 (N.D. Cal. Mar. 26, 

2013). Here, Qualcomm does not intend to offer any evidence based on its patent ratings. 

Although Qualcomm intends to offer evidence concerning its contributions to cellular 

technologies, such evidence will be based on witnesses’ own expertise or knowledge, not on 

privileged patent ratings. (E.g., Grob Tr. at 153:11-13.) Further, the patent ratings do not assess 

the monetary value of Qualcomm’s inventions. Indeed, in the coordinated action in the Southern 

District, Apple moved to compel Qualcomm to respond to interrogatories asking Qualcomm to 

describe the value it attributes to its patents. Although the Court did not reach the privilege 

issue, Magistrate Judge Dembin denied Apple’s request for patent ratings, concluding: “The 

Court is not persuaded that Qualcomm’s internal patent rating system, as discussed in this 

motion, values the patents within the meaning of these interrogatories.” (No. 17-cv-0108, 

ECF 381 at 3 (S.D. Cal.).) 

C. The FTC’s Renewed Attempt To Obtain Qualcomm’s Privileged Patent 

Ratings Should Be Denied.

Finally, this Court has previously addressed, and rejected, the FTC’s arguments regarding 

analyses by Qualcomm lawyers of Qualcomm’s patent portfolio. On October 30, 2017, the FTC 

moved to oppose Qualcomm’s clawback of an analysis by Mr. Martin that was based on 

Qualcomm’s patent ratings. (ECF No. 249.) Mr. Martin explained in a declaration that the 

patent ratings summarized in the clawed-back document 

 This Court was “persuaded by 

Qualcomm’s assertion of the attorney-client privilege” and denied the FTC’s motion on 

November 13, 2017. (ECF No. 290.) The FTC appealed this Court’s ruling (ECF No. 334), and 

that appeal was denied (ECF No. 456). The FTC’s renewed attempt to seek discovery of 

Qualcomm’s privileged patent ratings should likewise be denied. The FTC has not sought or 

obtained leave to move for reconsideration of the Court’s prior order. (See Civil L.R. 7-9.) And, 

as described above, the discovery record in this case confirms that Qualcomm’s patent ratings 

are privileged. 

// 

 

6

 In SanDisk Corp., the documents at issue did “not contain any legal advice”. SanDisk Corp., 

2014 WL 691565, at *3 (N.D. Cal. Feb. 21, 2014). 
6

 Respectfully submitted,

/s/ Jennifer Milici

Jennifer Milici, D.C. Bar No. 987096

jmilici@ftc.gov

Daniel Matheson, D.C. Bar No. 502490

dmatheson@ftc.gov

J. Alexander Ansaldo, Va. Bar No. 75870

jansaldo@ftc.gov

Joseph R. Baker, D.C. Bar No. 490802

jbaker@ftc.gov

Elizabeth A. Gillen, Ca. Bar No. 260667

egillen@ftc.gov

Federal Trade Commission

600 Pennsylvania Avenue, N.W.

Washington, D.C. 20580

Tel: (202) 326-2912; Fax (202) 326-3496

Lin W. Kahn, Ca. Bar No. 261387

lkahn@ftc.gov

Federal Trade Commission

901 Market Street, Suite 570

San Francisco, CA 94103

Tel: (415) 848-5115; Fax: (415) 848-5184

Attorneys for Plaintiff

FEDERAL TRADE COMMISSION

/s/ Gary Bornstein

CRAVATH, SWAINE & MOORE LLP

Gary A. Bornstein (pro hac vice) 

gbornstein@cravath.com

Yonatan Even (pro hac vice)

yeven @cravath.com

825 Eighth Avenue

New York, NY 10019-7475

Telephone: (212) 474-1000

Facsimile: (212) 474-3700

KEKER VAN NEST & PETERS LLP

Robert A. Van Nest

rvannest@keker.com

Asim M. Bhansali

abhansali@keker.com

Eugene M. Paige

epaige@keker.com

633 Battery Street

San Francisco, CA 94111-1809

Telephone: (415) 676-2289

Facsimile: (415) 397-7188
7

MORGAN, LEWIS & BOCKIUS LLP

Richard S. Taffet (pro hac vice)

richard.taffet@morganlewis.com

101 Park Avenue

New York, NY 10178-0060

Telephone: (212) 309-0060

Facsimile: (212) 309-6001

MORGAN, LEWIS & BOCKIUS LLP

Donn P. Pickett (SBN 72257)

donn.pickett@morganlewis.com

Geoffrey T. Holtz (SBN 191370)

geoffrey.holtz@morganlewis.com

One Market, Spear Street Tower

San Francisco, CA 94105-1596

Telephone: (415) 442-1000

Facsimile: (415) 442-1001

MORGAN, LEWIS & BOCKIUS LLP

Willard K. Tom

willard.tom@morganlewis.com

1111 Pennsylvania Avenue, N.W.

Washington, D.C. 20004-2541

Telephone: (202) 739-3000

Facsimile: (202) 739-3001

Attorneys for Defendant

QUALCOMM INCORPORATED
FILERS ATTESTATION

I, Jennifer Milici, am the ECF user whose identification and password are being used to 

file this Joint Discovery Statement. In compliance with Civil Local Rule 5-1(i)(3), I hereby attest 

that the signatories of this document have concurred in this filing.

/s/ Jennifer Milici

Jennifer Milici