Opinion ID: 209477
Heading Depth: 2
Heading Rank: 3

Heading: Breach of Disclosure Duty

Text: Having concluded that the proper scope of the disclosure duty requires JVT participants to disclose patents that reasonably might be necessary to practice the H.264 standard, we next address the question of whether Qualcomm breached this disclosure duty. It is undisputed that Qualcomm did not disclose the '104 and '767 Patents to the JVT prior to the release of the H.264 standard. Thus, Qualcomm breached its disclosure duty if, as the district court found by clear and convincing evidence, the '104 and '767 Patents reasonably might be necessary to practice the H.264 standard. As previously mentioned, the district court found clear and convincing evidence that the '104 and '767 Patents reasonably might be necessary to practice the H.264 standard. [6] In reaching this conclusion, the district court relied on the testimony from several Qualcomm witnesses. For example, the district court relied on testimony from Qualcomm's H.264 expert, who testified at trial that the claims of the ['104] patent map onto the H.264 standard, so that devices or systems that practice H.264 actually practice claims of the 104 patent. Waiver Order at . Additionally, inter alia, the district court relied on an email from a Qualcomm employee discussing the coverage of the '767 Patent, and describing it as a core patent relevant to H.264. Id. at . Qualcomm argues that the finding of non-infringement here refutes any finding that it breached a disclosure duty. Broadcom responds, however, that it is inconsistent for Qualcomm to now argue that the asserted patents do not meet the reasonably might be necessary standard, when Qualcomm accused Broadcom's products of infringement in this case solely because they practiced the H.264 standard. Broadcom also points to testimony of Qualcomm's own JVT participants in support of its claim that JVT participants considered that the asserted patents reasonably might be necessary to practice the H.264 standard. On appeal, Qualcomm does not present any arguments comparing the asserted claims to the H.264 standard in an attempt to show that they do not meet the reasonably might be necessary formulation. Indeed, Broadcom argues that if Qualcomm truly believes that the asserted patents do not meet the reasonably might be necessary standard, then it necessarily lacked a Rule 11 basis to bring this litigation in the first place. Appellee's Br. 48 (citing Fed. R.Civ.P. 11 (By presenting to the court a pleading ... an attorney ... certifies that... (2) the claims, defenses, and other legal contentions are warranted by existing law ... [and] (3) the factual contentions have evidentiary support....)). We are not persuaded by Qualcomm's arguments on this point, and are unable to reconcile its ex post argument that the asserted patents do not meet the reasonably might be necessary standard with its ex ante arguments regarding infringement. Based on the foregoing, we conclude that the district court did not err in finding clear and convincing evidence that the '104 and '767 Patents fell within the reasonably might be necessary standard. Thus, the district court properly determined that Qualcomm breached its disclosure duty by failing to disclose the '104 and '767 Patents to the JVT prior to the release of the H.264 standard in May 2003. Accordingly, we turn to the question of whether it was within the district court's equitable authority to enter an unenforceability remedy in this case.