Court Opinion

ID: 4282690
Source: CourtListenerOpinion
Date Created: 2018-06-08 15:00:51.447486+00
Date Added: 2024-06-11T14:34:57.192126
License: Public Domain

NOTE: This disposition is nonprecedential.

  United States Court of Appeals
      for the Federal Circuit
                ______________________

                 XIAOHUA HUANG,
                  Plaintiff-Appellant

                           v.

       HUAWEI TECHNOLOGIES CO., LTD.,
               Defendant-Appellee
            ______________________

2017-1505, 2017-1767, 2017-1893, 2017-2092, 2017-2229
               ______________________

   Appeals from the United States District Court for the
Eastern District of Texas in No. 2:15-cv-01413-JRG-RSP,
Judge J. Rodney Gilstrap.
                 ______________________

                 Decided: June 8, 2018
                ______________________

   XIAOHUA HUANG, Campbell, CA, pro se.

    E. LEON CARTER, Carter Scholer Arnett & Mockler
PLLC, Dallas, TX, for defendant-appellee. Also repre-
sented by SCOTT W. BREEDLOVE, JOHN STEVEN
TORKELSON; GREGORY A. CASTANIAS, DANIEL KAZHDAN,
Jones Day, Washington, DC.
               ______________________

       Before REYNA, LINN, and CHEN, Circuit Judges.
2                    HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.

PER CURIAM.

    Appellant Xiaohua Huang, proceeding pro se, appeals
several rulings from the United States District Court for
the Eastern District of Texas, including the district court’s
grant of summary judgment of noninfringement and grant
of attorneys’ fees and expert costs. Mr. Huang has filed
five separate appeals in this court, all pertaining to the
district court action. 1 The five appeals have been consoli-
dated and are addressed below. Because the district court
did not err or abuse its discretion in granting summary
judgment, granting attorneys’ fees and costs, and in other
rulings challenged by Mr. Huang, we affirm.

                       BACKGROUND

                I.   Initiation of the Lawsuit

    Mr. Huang is the owner of U.S. Patent Nos. 6,744,653,
6,999,331, and RE45259 (collectively, the “Huang pa-
tents”). The Huang patents relate to ternary content
addressable memory (“TCAM”) technology in the field of
semiconductor chips.    TCAM is a type of computer
memory used in search applications that can achieve
high-speed routing and switching in networking devices.

    1   Mr. Huang filed a first appeal (2017-1505) after
summary judgment of noninfringement. Mr. Huang filed
a second appeal (2017-1767), challenging the district
court’s decision to award unquantified fees and several of
the underlying orders. Mr. Huang’s third appeal (2017-
1893) concerns the district court’s quantified fee award
and several of the same underlying orders. Mr. Huang’s
fourth (2017-2092) and fifth (2017-2229) appeals are
largely duplicative of the first three appeals.
 HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.                3

    On August 14, 2015, Mr. Huang filed the original
complaint on behalf of himself and his company, CMOS
Micro Device Inc. (“CMOS”), which develops TCAM tech-
nology. The complaint alleged that Huawei Technologies
Inc. (“Huawei”) infringed the Huang patents by making
and selling “switches.” SAppx29. Huawei filed a motion
to compel CMOS to obtain counsel on the grounds that a
corporation may not proceed pro se. In response, Mr.
Huang amended his complaint to drop CMOS from the
lawsuit.

    Early in the case, the parties jointly moved for entry
of an agreed protective order. The protective order pro-
vided that certain types of confidential information desig-
nated as “attorneys’ eyes only” would be subject to
disclosure only to counsel, including outside counsel and
“in-house counsel with no competitive decision-making
authority.” SAppx59–62. The protective order also
limited disclosure of information designated as confiden-
tial source code to “outside counsel and up to three (3)
outside consultants or experts.” Id.

    On December 1, 2015, Mr. Huang served his in-
fringement contentions pursuant to local patent rules,
accusing seven Huawei switches and routers of infringe-
ment on the basis that they contained certain third-party
chips that allegedly infringed the Huang patents. On
January 20, 2016, Mr. Huang filed a third amended
complaint following additional early motion practice. The
amended complaint also included contentions that
Huawei products infringed on the basis of products from
third-party suppliers.
4                  HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.

           II.   Discovery and Rule 11 Motions

    After serving invalidity contentions, Huawei served a
Rule 11 safe-harbor letter 2 on Mr. Huang on March 22,
2016. The letter asserted that Mr. Huang’s claims were
baseless and that a pre-suit investigation would have
revealed that some of the accused products were never
sold in the United States. Huawei also made various
documents available, including documents from third-
party suppliers designated as attorneys’ eyes only pursu-
ant to the protective order. Huawei contended that the
documents showed that the accused products did not
infringe the Huang patents and requested that Mr.
Huang hire an attorney who could have access to the
designated information to evaluate Huawei’s contentions.
Mr. Huang refused Huawei’s request, and on May 23,
2016, Huawei filed a Rule 11 motion.

    A few days later, Mr. Huang filed motions to amend
the complaint and his infringement contentions in order
to add seventy-four additional Huawei products. All of
the additional products were listed on Huawei’s public
website on December 1, 2015, when Mr. Huang initially
served his infringement contentions.

    On July 8, 2017, Mr. Huang filed the first of several
motions to compel access to information designated as
attorneys’ eyes only and confidential source code. Mr.
Huang took no depositions and served no interrogatories
during discovery.

    2   Pursuant to Federal Rule of Civil Procedure 11,
Huawei’s letter attached its intended motion for Rule 11
sanctions and gave Mr. Huang notice of Huawei’s intent
to move at least twenty-one days in advance of filing.
 HUANG    v. HUAWEI TECHNOLOGIES CO., LTD.                5

   III.     The July 2016 Hearing and Stay of the Case

    In lieu of a planned Markman hearing, the magistrate
judge set a hearing for July 27, 2016, on several pending
motions, including Mr. Huang’s first motion to compel, his
motions to amend the infringement contentions and the
third amended complaint, and Huawei’s Rule 11 motion.
The court denied Mr. Huang’s motion to compel the
designated confidential information on the basis that Mr.
Huang was prohibited from personally gaining access to it
under the terms of the protective order. The court denied
the motion without prejudice, instructing Mr. Huang that
he could re-file it after retaining counsel who could seek
access to the designated information. The court also
denied Mr. Huang’s motions to amend the infringement
contentions and the complaint for lack of good cause.

    At the hearing, the court explained the difficulties Mr.
Huang would face in satisfying the burden of proof in his
case without access to designated confidential information
and encouraged him to obtain counsel. Mr. Huang repre-
sented that he had tried to retain counsel and would
continue to do so. Mr. Huang also asserted that he could
prove his case without personally gaining access to the
confidential information by hiring a third party to reverse
engineer the accused chips, a process that he acknowl-
edged would cost hundreds of thousands of dollars.
SAppx1066–75. Despite Mr. Huang’s assertion that he
did not need access to confidential information, the court
stayed the case for sixty days to allow Mr. Huang time to
seek assistance of counsel and deferred ruling on
Huawei’s Rule 11 motion.

    About two weeks after the July hearing, during the
stay, Mr. Huang filed the first of several more motions to
compel the same type of designated confidential infor-
mation he previously sought. Mr. Huang also filed addi-
tional motions to amend the complaint and to amend
6                    HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.

infringement contentions—the same motions denied by
the court at the July hearing. The court denied all of Mr.
Huang’s renewed motions without prejudice in light of the
stay.

    At this point, Mr. Huang filed a separate patent in-
fringement suit, alleging infringement of the Huang
patents by the same seventy-four Huawei products he
attempted to add to his first case. Mr. Huang then filed a
motion to consolidate the two cases.

               IV.     Summary Judgment

    On September 29, 2016, Huawei moved for summary
judgment of noninfringement as to all three Huang pa-
tents. Huawei asserted that summary judgment was
warranted for lack of infringement evidence and because
its own evidence established noninfringement. In re-
sponse to Huawei’s motion, Mr. Huang submitted exhibits
of purported reverse-engineering images and drawings,
including hand-drawn figures, that he had not produced
in discovery. His exhibits also included declarations from
previously undisclosed witnesses.      Huawei moved to
strike several of Mr. Huang’s exhibits on various grounds,
including failure to produce or disclose them during
discovery.

    On November 22, 2016, the magistrate judge issued a
combined order and report and recommendation on sum-
mary judgment and several other motions. The magis-
trate judge recommended granting summary judgment,
finding that Mr. Huang had not raised a triable issue of
fact, and noted that Mr. Huang chose not to hire an
attorney that would have been able to access protective
order information on the Huawei products. The magis-
trate judge granted Huawei’s motion to strike on the basis
that Mr. Huang failed to produce or disclose during dis-
covery the exhibits that he submitted with his response.
 HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.               7

    In the same order, the court denied third and fourth
motions to compel filed by Mr. Huang. Mr. Huang had
recently retained experts and asserted that they should
have access to the designated information he sought in his
prior motions to compel. The court reasoned that provid-
ing the experts with the designated information would be
of no use to Mr. Huang, referring to the reasons explained
at the July hearing. Four days after the magistrate
judge’s order, Mr. Huang filed a fifth motion to compel
similar information, which the court denied.

    On December 7, 2016, the district judge adopted the
magistrate judge’s November 22 order and report and
recommendation, overruling objections filed by Mr.
Huang. The next day, Mr. Huang filed a second challenge
to the magistrate judge’s ruling, which the district judge
again denied while confirming that Mr. Huang’s claims
were dismissed.

              V.    Attorneys’ Fees and Costs

     On January 31, 2017, Huawei moved for fees and ex-
pert costs under 35 U.S.C. § 285 and the court’s inherent
power. In support, Huawei submitted declarations stat-
ing that Mr. Huang repeatedly contacted Huawei’s in-
house counsel about settlement, despite Huawei’s outside
counsel’s repeated instructions to Mr. Huang not to do so.
The declarations asserted that Mr. Huang had stated that
he sued Huawei because he believed the case would
quickly settle for $1.5 million, that he did not want to
share revenue with a lawyer, and that he would continue
filing motions to force Huawei to incur legal fees.
Huawei’s fees motion also pointed to Mr. Huang’s allega-
tions that Huawei, its attorneys, and its third-party
declarants had purportedly made perjured statements in
8                  HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.

Huawei’s summary judgment declarations. 3 Mr. Huang
responded by making additional unsupported perjury
allegations.

     After a hearing, the magistrate judge granted
Huawei’s fees motion, finding that the case was excep-
tional under § 285 and worthy of granting expert costs
under the court’s inherent power. The court found that
Mr. Huang “offered no satisfactory explanation for his
litigation conduct,” which the court determined was in
bad faith and an abuse of the judicial process. Xiaohua
Huang v. Huawei Techs. Co., No. 2:15-CV-1413, 2017 WL
1133201, at *3–4 (E.D. Tex. Mar. 27, 2017). The court
found that Mr. Huang’s motion practice corroborated the
statements about Mr. Huang’s litigation motives in
Huawei’s declarations in support of its fees motion. The
court noted it had given Mr. Huang ample opportunity to
retain assistance of counsel and that Mr. Huang’s pro se
status did not relieve him from the consequences of frivo-
lous litigation conduct. On these grounds, the court
awarded attorneys’ fees and costs to Huawei.

    In quantifying the fees and costs awarded, the magis-
trate judge limited the amount to those incurred from the
date of Huawei’s Rule 11 safe-harbor letter to the grant of
summary judgment on December 7, 2016. The court
awarded a total of $604,036.71. 4

    3    Mr. Huang’s unsupported perjury allegations be-
gan after dismissal of his claims and Huawei’s rejection of
a five-figure settlement offer, and included filing a motion
requesting that Huawei’s declarants be criminally prose-
cuted.
    4    Mr. Huang objected to the magistrate judge’s de-
cision by making additional accusations of perjury and
characterizing the magistrate judge’s ruling as “deliber-
 HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.                  9

    This court     has    jurisdiction   under   28   U.S.C.
§ 1295(a)(1).

                         DISCUSSION

                  I.     Summary Judgment

     Huawei moved for summary judgment of nonin-
fringement on the basis that Mr. Huang presented no
evidence showing the structure or operation of the ac-
cused Huawei products to support his allegations of
infringement. Huawei also contended that it presented
affirmative evidence of noninfringement through its own
documents and declarations from Huawei employees and
a technical expert. The district court granted Huawei’s
motion for summary judgment and dismissed Mr. Huang’s
claims. Mr. Huang argues that the district court erred
because he presented evidence of infringement through
several exhibits attached to his opposition to Huawei’s
summary judgment motion. We agree with the district
court.

    We review a grant of summary judgment under the
law of the regional circuit, in this case, the Fifth Circuit.
See Travel Sentry, Inc. v. Tropp, 877 F.3d 1370, 1376
(Fed. Cir. 2017). The Fifth Circuit reviews a grant of
summary judgment de novo. Triple Tee Golf, Inc. v. Nike,
Inc., 485 F.3d 253, 261 (5th Cir. 2007). On appeal from a
grant of summary judgment of noninfringement, we
determine whether no reasonable jury could find in-
fringement after resolving reasonable factual inferences

ately an abuse of discretion.” Appx6. In overruling the
objections, the district judge warned that he “may issue
further sanctions for [Mr. Huang’s] flagrant abuse of the
judicial process” and unsupported allegations against
Huawei and the magistrate judge. SAppx24.
10                 HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.

in favor of the patentee. IMS Tech., Inc. v. Haas Automa-
tion, Inc., 206 F.3d 1422, 1429 (Fed. Cir. 2000).

    Mr. Huang failed to produce any evidence showing the
structure or operation of Huawei’s accused products or
how the limitations of the claims of the Huang patents
were met by such accused products. Without Mr. Huang
having access to information on the accused Huawei
products, he could not show how they purportedly in-
fringed the Huang patents. Moreover, Huawei presented
unrebutted evidence of noninfringement. Even consider-
ing the evidence in the light most favorable to Mr. Huang,
it does not establish a genuine dispute of material fact
such that a reasonable jury could find infringement. See
Appx13, 20–21. Accordingly, we affirm the district court’s
grant of summary judgment of noninfringement.

     Mr. Huang also challenges the district court’s decision
to grant Huawei’s motion to strike several exhibits at-
tached to his response in opposition to Huawei’s motion
for summary judgment, including purported reverse-
engineering records. Mr. Huang contends that because he
filed his opposition with the attached exhibits on the last
day of discovery, the district court erred in granting
Huawei’s motion to strike. Huawei responds that the
district court properly struck Mr. Huang’s exhibits be-
cause they consisted of declarations from previously
undisclosed witnesses and were based on purported
reverse-engineering records that were never produced, in
violation of Mr. Huang’s discovery obligations.

    “A district court’s rulings regarding evidence it will
consider in deciding a motion for summary judgment are
reviewed for abuse of discretion.” Tex. E. Transmission
Corp. v. Amerada Hess Corp., 145 F.3d 737, 741 (5th Cir.
1998); see also United States v. Phillips, 219 F.3d 404, 409
(5th Cir. 2000) (“We review the district court’s admission
of evidence for an abuse of discretion.”). We agree that
HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.                 11

Mr. Huang’s failure to meet his discovery obligations by
not producing information5 central to his case provides a
sufficient basis for striking Mr. Huang’s exhibits. Thus,
the district court did not abuse its discretion in granting
Huawei’s motion to strike.

              II.   Attorneys’ Fees and Costs

     The district court found that this was an exceptional
case and granted attorneys’ fees to Huawei under § 285.
We agree. An “exceptional” case “stands out from others
with respect to the substantive strength of a party’s
litigating position (considering both the governing law
and the facts of the case) or the unreasonable manner in
which the case was litigated.” Highmark Inc. v. Allcare
Health Mgmt. Sys., Inc., 134 S. Ct. 1744, 1748 (2014).
“[T]he exceptional-case determination is to be reviewed
only for abuse of discretion.” Id. We give deference to the
district court as it “is better positioned to decide whether

   5    The record indicates that Mr. Huang withheld
this information from Huawei, despite its repeated re-
quests to produce it. While Mr. Huang claims that he
provided the information at issue with his summary
judgment opposition on the last day of discovery, the
record shows that he relied on declarations from witness-
es who had never been previously disclosed. See e.g.,
SAppx755, 883–85. Moreover, the record indicates that
he never produced the raw data underlying several exhib-
its to his summary judgment opposition. See SAppx884.
Mr. Huang’s amended initial and additional disclosures,
filed after the close of discovery, indicated that he had
information “ready to be released to Defendant upon [sic]
the Defendant provides the information which Plaintiff
required [sic]” and listed the same types of confidential
information subject to his motions to compel that he
requested from Huawei. SAppx 776.
12                  HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.

a case is exceptional . . . because it lives with the case over
a prolonged period of time.” Id. (internal quotation marks
omitted).

     The record reflects that Mr. Huang presented no evi-
dence to support his litigation position and that Mr.
Huang litigated the case in a frivolous manner. Mr.
Huang submitted no evidence of pre-suit investigation
and no evidence of infringement. Huawei submitted
evidence that Mr. Huang’s intent from the outset of the
litigation was to force Huawei to incur legal fees in hopes
that it would quickly settle. Mr. Huang did not attempt
to refute this evidence except with baseless allegations of
perjury against Huawei’s declarants and counsel. Fur-
ther, Mr. Huang’s accelerating motion practice as the case
progressed, including filing repetitive and nearly identical
motions, was unreasonable litigation conduct and con-
sistent with the declarations submitted by Huawei in
support of its fees motion.

     As the district court observed, pro se plaintiffs have
been held liable for attorneys’ fees simply because their
patent infringement actions had no evidentiary basis,
even without similar litigation misconduct as in this case.
See, e.g., Yufa v. TSI Inc., No. 09-CV-1315, 2014 WL
4071902, at *4 (N.D. Cal. Aug. 14, 2014); Comora v.
Thermo Cardiosystems, Inc., No. 91-CV-5620, 1992 WL
315226, at *4 (C.D. Cal. May 5, 1992). Accordingly, we
affirm the district court’s award of attorneys’ fees under
§ 285.

    The district court also granted expert costs under its
inherent power. Several times, the district court found
that Mr. Huang’s litigation behavior constituted bad faith
and an abuse of the judicial process. Appx6, 14. We
review the district court’s grant of sanctions under its
inherent power de novo. F.D.I.C. v. Maxxam, Inc., 523
F.3d 566, 590 (5th Cir. 2008). Upon review of the record,
HUANG   v. HUAWEI TECHNOLOGIES CO., LTD.                 13

we agree with the findings of the district court. Accord-
ingly, the district court did not err in invoking its inher-
ent authority to award expert costs.

                        CONCLUSION

    Mr. Huang challenges several other rulings made by
the district court. We have reviewed Mr. Huang’s remain-
ing arguments and consider them to be without merit.
For the foregoing reasons, the court affirms the district
court’s grant of summary judgment of noninfringement,
grant of attorneys’ fees and expert costs, and the other
district court rulings challenged by Mr. Huang.

                        AFFIRMED

                           COSTS

   Costs to Appellee.