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1 Gregory P. Stone (State Bar No. 078329) Rollin A. Ransom (State Bar No. 196126)
Steven M. Perry (State Bar No. 106154) SIDLEY AUSTIN LLP
2 Sean Eskovitz (State Bar No. 241877) 555 West Fifth Street, Suite 4000
MUNGER, TOLLES & OLSON LLP Los Angeles, California 90013-1010
3 355 South Grand Avenue, 35th Floor Telephone: (213) 896-6000
Los Angeles, California 90071-1560 Facsimile: (213) 896-6600
4 Telephone: (213) 683-9100 Email: rransom@sidley.com
Facsimile: (213) 687-3702
5 Email: gregory.stone@mto.com;
steven.perry@mto.com; sean.eskovitz@mto.com
6
Peter A. Detre (State Bar No. 182619) Pierre J. Hubert (Pro Hac Vice)
7 Carolyn Hoecker Luedtke (State Bar No. 207976) Craig N. Tolliver (Pro Hac Vice)
Jennifer L. Polse (State Bar No. 219202) McKOOL SMITH PC
8 MUNGER, TOLLES & OLSON LLP 300 West 6th Street, Suite 1700
560 Mission Street, 27th Floor Austin, Texas 78701
9 San Francisco, California 94105 Telephone: (512) 692-8700
Telephone: (415) 512-4000 Facsimile: (512) 692-8744
10 Facsimile: (415) 512-4077 Email: phubert@mckoolsmith.com;
Email: peter.detre@mto.com; ctolliver@mckoolsmith.com
11 carolyn.luedtke@mto.com; jen.polse@mto.com

12 Attorneys for Plaintiff

RAMBUS INC.
13

14 UNITED STATES DISTRICT COURT

15 NORTHERN DISTRICT OF CALIFORNIA
16 SAN JOSE DIVISION
17
RAMBUS INC., Case No. C 05-00334 RMW
18
Plaintiffs, RAMBUS’ NOTICE OF MOTION AND
19
MOTION TO COMPEL
vs. NANYA TECHNOLOGY CORPORATION
20
TO PRODUCE DOCUMENTS
HYNIX SEMICONDUCTOR INC., HYNIX
21 SEMICONDUCTOR AMERICA INC., HYNIX
SEMICONDUCTOR MANUFACTURING
22 AMERICA INC., PUBLIC VERSION
23 SAMSUNG ELECTRONICS CO., LTD., Date: October 2, 2008
SAMSUNG ELECTRONICS AMERICA, Time: 9:00 a.m.
24 INC., SAMSUNG SEMICONDUCTOR, INC.,
SAMSUNG AUSTIN SEMICONDUCTOR, Before: Honorable Read Ambler (Ret.)
25 L.P., Place: JAMS-San Jose (telephonic)
26 NANYA TECHNOLOGY CORPORATION,
NANYA TECHNOLOGY CORPORATION
27 U.S.A.,
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1 Defendants.

2 HYNIX SEMICONDUCTOR INC., HYNIX

SEMICONDUCTOR AMERICA INC.,
3 HYNIX SEMICONDUCTOR
MANUFACTURING AMERICA INC.,
4 HYNIX SEMICONDUCTOR U.K. LTD.,
HYNIX SEMICONDUCTOR
5
DEUTSCHLAND GmbH,
6
Counterclaim Plaintiffs,
7
vs.
8
RAMBUS INC.,
9
Counterdefendant.
10
NOTICE OF MOTION AND MOTION
11
TO DEFENDANTS NANYA TECHNOLOGY CORPORATION AND NANYA TECHNOLOGY
12
CORPORATION U.S.A. (collectively, hereinafter “Nanya”), ALL PARTIES AND THEIR
13
COUNSEL OF RECORD:
14
PLEASE TAKE NOTICE that on October 2, 2008, at 9:00 a.m., or as soon thereafter
15
as the matter may be heard, Plaintiff Rambus, Inc. (“Rambus”) will and hereby does move, pursuant
16
to Rules 26 and 37 of the Federal Rules of Civil Procedure, for an order compelling Nanya
17
Technology Corporation (“NTC”) to produce the documents described in this motion, and in the
18
Declaration of Matthew T. Powers filed concurrently herewith. Rambus’ Motion is based upon this
19
Notice of Motion, the Memorandum of Points and Authorities below, the Declaration of Matthew T.
20
Powers in Support of Rambus’ Motion to Compel (“Powers Decl.”), and upon such further written
21
or oral argument as may be received by the Court.
22
MEMORANDUM OF POINTS AND AUTHORITIES
23
I. INTRODUCTION AND BACKGROUND
24
On May 9, 2008, Rambus served its Fourth Set of Requests for Production on NTC and its
25
subsidiary, Nanya Technology Corporation USA (“NTC-USA”). Powers Decl., Ex. 1. Request 20-
26
A called for “All documents relating to any license involving any Accused Product or any license of
27
any patent covering any Accused Product, including any cross-license, sublicense, or covenant not to
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1 sue.” Powers Decl., Ex. 1, p. 10. Request 48-A called for “All documents, including royalty reports,

2 that relate to the payment of royalties or other consideration associated with any Accused Product

3 made by Nanya to another entity for use of any technology in any Accused Product.” Powers Decl.,

4 Ex. 1, p. 13.

5 On June 11, 2008, NTC and NTC-USA served responses and objections to the foregoing

6 requests. Powers Decl., Ex. 2. In response to Rambus’ Request 20-A, NTC agreed to “produce non-

7 privileged, non-cumulative documents relating to any license, cross-license, sublicense, or covenant

8 not to sue related to any United States patent in its possession, custody or control that can be located

9 through a diligent search and reasonable inquiry, responsive to this request.” Powers Decl., Ex. 2, p.

10 21. In response to Rambus’ Request 48-A, NTC agreed to “produce non-privileged, non-cumulative

11 documents relating to royalties and consideration paid for technology used in the United States in its

12 possession, custody or control that can be located through a diligent search and reasonable inquiry,

13 responsive to this request.” Powers Decl., Ex. 2, p. 32. NTC has produced numerous licenses and

14 documents responsive to these requests. These licenses (and the withheld licenses which are the

15 subject of this motion) are directly relevant to expert reports on damages and royalty rates which are

16 now being exchanged.

17 The Court has set a trial date in January, 2009 for this case, and a fact discovery cutoff of

18 August 29, 2008. In order to ensure that NTC had properly supplemented its production of sales and

19 licensing information, Rambus’ counsel wrote to NTC’s counsel, requesting any additional

20 documents not previously produced by NTC responsive to Requests 20-A and 48-A. Powers Decl.,

21 Ex. 3. In response, NTC’s counsel indicated that “NTC and NTC-USA have produced all non-

22 privileged documents responsive to Rambus’ requests for production Nos. 20-A and 48-A that could

23 be located after a reasonable search.” Powers Decl., Ex. 4. NTC therefore never objected to

24 production of patent and technology agreements, but agreed to produce such documents.

25 On July 9, 2008, Rambus served a Rule 30(b)(6) deposition notice on NTC. Powers Decl.,

26 Ex. 5. Topic 3 of the notice required testimony regarding NTC’s licenses. This deposition was

27
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1 subsequently set to take place on September 8 and 9, 2008, at the request of NTC. Powers Decl.,

2 ¶14.

3 On September 2, 2008, Nanya and Fujitsu Microelectronics Ltd. announced that they had

4 entered into a patent licensing agreement. Powers Decl., Ex. 6 (public announcement of agreement).

5 According to the public announcements of this license, the agreement settled various patent disputes

6 between Nanya and Fujitsu, and related to DDR SDRAM, one of the products at issue in this case.

7 The agreement is therefore directly relevant, is responsive to Rambus’ document requests, and

8 should be produced. On September 3, 2008, counsel for Rambus e-mailed counsel for NTC and

9 requested production of the Nanya-Fujitsu license agreement. Powers Decl., Ex. 7. Counsel for

10 NTC did not respond to that request prior to the deposition scheduled for September 8 and 9.

11 On April 21, 2008, Nanya and Micron Technology, Inc. (“Micron”), a defendant in this case,

12 publicly announced that they had signed a DRAM joint venture agreement. Powers Decl., Ex. 8

13 (copy of an exemplary public announcement taken from NTC’s website). Micron has produced to

14 Rambus a royalty spreadsheet which refers to license revenue received from NTC. Powers Decl.,

15 ¶10, Ex. 9. Specifically, that royalty spreadsheet, entitled “Royalty Revenue for Intellectual

16 Property Rights”, contains an entry recording “License fee revenue related to the Micron/Nanya JV”

17 of $8,264,546. This indicates that Micron has collected over $8 million in licensing fees related to

18 the joint venture.

19 On September 8, 2008, Rambus took the deposition of NTC’s 30(b)(6) witness on sales and

20 licensing issues, Dr. Pei Lin Pai. Powers Decl., Ex. 10 (excerpts of Dr. Pai’s deposition). Dr. Pai

21 confirmed the existence of the Nanya-Fujitsu license agreement and the Nanya-Micron joint venture

22 agreement. Powers Decl., Ex. 10, pp. 85-86 (Micron), 94-95 (Fujitsu). Dr. Pai also initially testified

23 that the Nanya-Micron joint venture agreement contained patent cross-licenses. Powers Decl., Ex.

24 10, pp. 86-87. Dr. Pai testified that NTC was obligated to pay Micron a percentage royalty on

25 DRAM products sold by NTC – specifically, DDR2 and DDR3, each of which are at issue in this

26 case. Powers Decl., Ex. 10, pp. 87-92. On September 9, 2008, after speaking with NTC’s legal

27 department, but without reviewing any agreements, Dr. Pai contradicted that testimony and
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1 characterized the Nanya-Micron joint venture agreement as a technology transfer with no patent

2 licenses. Powers Decl., Ex. 10, pp. 119-122. Dr. Pai also testified initially that Nanya had recently

3 renewed its license agreement with Samsung, then stated he would have to check to see if that was

4 true. Powers Decl., Ex. 10, pp. 101-102.

5 On September 10, 2008, Rambus again requested production of the Nanya-Fujitsu license

6 agreement by NTC, requested production of the Nanya-Micron joint venture agreement, and

7 requested production of any new Samsung license. Powers Decl., Ex. 11. On September 11, 2008,

8 NTC refused to produce either the Nanya-Fujitsu license agreement or the Nanya-Micron agreement.

9 Powers Decl., Ex. 12. NTC’s only basis for refusing to produce the Nanya-Fujitsu agreement (or

10 any Samsung renewal signed after August 29, 2008) is that it was signed after the discovery cutoff

11 date – NTC has stated no other objection to production of these two items. With respect to the

12 Nanya-Micron joint venture agreement, NTC’s sole objection is that it is “not relevant” because it

13 involves “technology licensing.” This motion followed.

14 Because NTC’s objections are meritless, and because the Fujitsu, Micron, and Samsung

15 licenses are discoverable and relevant, the Court should grant Rambus’ Motion to Compel.

16 II. ARGUMENT

17 A. LEGAL STANDARD

18 Parties may obtain discovery regarding any matter, not privileged, that is relevant to the

19 claim or defense of any party. Fed. R. Civ. P. 26(b)(1). Upon a showing of “good cause” the Court

20 may order discovery of any relevant matter. Id. Rambus’ document requests 20-A and 48-A sought

21 discovery of license agreements involving any accused product or any patent covering any accused

22 product; and royalty documents associated with any accused product made by NTC, where such

23 payments were made to another entity for use of any technology in an accused product. Powers

24 Decl., Ex. 1, at pp. 10, 13. These documents are directly relevant to the determination of a

25 “reasonable royalty” in this case. See 35 U.S.C. §284 (patentee entitled to no less than a reasonable

26 royalty); Georgia-Pacific Corp. v. U.S. Plywood-Champion Papers, Inc., 318 F.Supp. 1116, 1120

27
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1 (S.D. N.Y. 1970) (factor in determination of reasonable royalty is “The rates paid by the licensee for

2 the use of other patents comparable to the patent in suit.”).

3 Any objection to the production of documents must be made within the time specified by

4 Federal Rule of Civil Procedure 34; failure to object to such requests results in a waiver of those

5 objections. Fed. R. Civ. P. 34(b)(2)(A); Richmark Corp. v. Timber Falling Consultants, 959 F.2d

6 1468, 1473 (9th Cir. 1992); Schwarzer, et al., California Pratice Guide, Federal Civil Procedure

7 Before Trial (2008 Ed.), p. 11-262, §11:1905 (failure to object waives objections). Here, NTC never

8 objected to producing patent license or agreements relating to payment of royalties with respect to

9 the accused products; rather, NTC agreed to produce such documents. Powers Decl., ¶¶2-3, Ex. 2,

10 pp. 21, 32.

11 Documents discovered or coming into a party’s possession after an earlier document request

12 for such documents must be disclosed. U.S. v. Boyce, 148 F.Supp. 2d 1069, 1088 (S.D. Ca. 2001)

13 (documents post-dating discovery fall under “continuing duty to supplement” under Rule 26(e)).

14 Accordingly, NTC has a duty to supplement or correct prior discovery responses that extends

15 beyond fact discovery. F. R. Civ. P. 26(e). A party who has served discovery responses must

16 supplement or correct its response if the party learns that the response is “incomplete or incorrect,

17 and if the additional or corrective information has not otherwise been made known to the other

18 parties during the discovery process or in writing.” As a matter of law, this duty extends beyond the

19 discovery period. See Schwarzer, et al., California Pratice Guide, Federal Civil Procedure Before

20 Trial (2008 Ed.), p. 11-152, §11:1241 (“The duty to supplement or correct earlier discovery

21 responses continues even after the close of scheduled discovery.”), citing Adv. Comm. Notes on

22 1993 Amendments to F. R. Civ. P. 26(e) (“Supplementations…should be made…with special

23 promptness as the trial date approaches.”).

24 B. NTC HAS A DUTY TO PRODUCE THE REQUESTED DOCUMENTS

25 1. The Fujitsu and Samsung Agreements Must be Produced.

26 The Nanya-Fujitsu agreement is a patent license agreement related to some of the same

27 products at issue in this case – SDR and DDR SDRAM products. Powers Decl., Ex. 10, pp. 94-96.
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1 NTC’s sole objection to production is that it was executed after the discovery cutoff date of August

2 29, 2008. Powers Decl., Ex. 12. As a matter of law, this objection is meritless, since NTC has a

3 duty to supplement or correct its earlier responses which extends beyond the cutoff. The same is

4 true of any renewal of the Nanya-Samsung license, if it exists. The sole basis for withholding this

5 agreement asserted by NTC was its possible execution after the discovery cutoff. Powers Decl., Ex.

6 12.

7 2. The Micron Joint Venture Agreement Must be Produced.

8 The Nanya-Micron joint venture agreement requires NTC to pay Micron royalties on

9 products made by the joint venture using Micron’s technology. Powers Decl., Ex. 10, pp. 86-87.

10 Dr. Pai, NTC’s 30(b)(6) deposition witness on licenses, testified initially that he believed there were

11 patent cross-licenses in that agreement. Powers Decl., Ex. 10, p. 87. He later contradicted that

12 testimony and stated that there was “only technology licensing”, not patent licenses. Powers Decl.,

13 Ex. 10, p. 120. The Nanya-Micron joint venture agreement will produce DDR2 and/or DDR3

14 products, and NTC will pay Micron a lump sum royalty and running royalty rate on these products.

15 Powers Decl., Ex. 10, p. 89-91. Micron has produced a royalty summary to Rambus which describes

16 a payment made by NTC to Micron as “license fee revenue related to the Micron/Nanya JV” of

17 $8,264,546 in 2008. Powers Decl., Ex. 9.

18 NTC’s argument that the Micron agreement is not relevant is meritless. Both NTC and

19 Micron have characterized that agreement as containing royalty obligations payable by NTC based

20 on sales of products that are accused in this case – DDR2 and DDR3 products. Neither NTC nor

21 Micron ever objected to producing that agreement in their discovery responses. Instead, NTC agreed

22 to produce documents “relating to royalties and consideration paid for technology used in the United

23 States”. Powers Decl., Ex. 2, at p. 32. This response is clearly not limited to patent license

24 agreements, but extends to documents relating to royalty obligations pertaining to technology.

25 Moreover, Rambus requested documents “relating to any license involving any Accused Product” –

26 not just patent licenses; and NTC responded that it would produce “documents relating to any

27 license, cross-license, or covenant not to sue related to any United States patent…”. Powers Decl.,
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1 Ex. 2, at p. 21.

2 Rambus is entitled to “any nonprivileged matter that is relevant to any party’s claim or

3 defense” – and for good cause, the Court may permit discovery of information relevant to the

4 “subject matter involved in the action.” F. R. Civ. P. 26(b)(1). There is no question that the Micron

5 agreement involves the same accused products in this action, and contains royalty provisions for

6 NTC’s use of Micron technology to be used to make such products, and for NTC’s sales of the

7 resulting products. Moreover, it is highly unlikely that a comprehensive technology transfer

8 agreement (such as the Nanya-Micron joint venture agreement) does not address the use of Micron’s

9 patents and Nanya’s patents in some way.1 NTC is not entitled to refuse to produce a clearly

10 relevant document by characterizing its contents as irrelevant. Rambus is entitled to determine for

11 itself what use can be made of this document during the expert report period now underway, and at

12 trial.

13 III. CONCLUSION

14 For the foregoing reasons, the Court should grant Rambus’ Motion to Compel NTC to

15 produce documents.

16 DATED: September 12, 2008 Respectfully submitted,

17

18 SIDLEY AUSTIN LLP

19

20 By: /s/
Matthew T. Powers
21
Attorneys for Plaintiffs
22 RAMBUS INC.
23

24

25

26
1
See MacLaren, Eckstrom’s Licensing in Foreign and Domestic Operations (Thomson-West 2002), §1:41 (discussing
27 importance of articulating all intellectual property rights in any technology joint venture).
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