Bringing a protracted IP dispute to a close, SanDisk Corp. announced this week that a Santa Clara County jury awarded the company $28.5 million in damages for a licensing agreement breach by PNY Technologies.
SanDisk sued PNY in 2007, accusing it of infringing flash memory patents, and the companies settled in 2008. But PNY evidently didn’t cough up all the royalties it owed, prompting SanDisk to file a breach-of-contract suit in 2011.
SanDisk’s GC, Eric Whitaker, notes that the company has one of the strongest patent portfolios in the world, ranked fourth globally by th Institute of Electrical and Electronics Engineers. The trial pitted Daniel Asimow of Arnold & Porter against Allen Ruby of Skadden, Arps, Slate, Meagher & Flom. Over email, The Recorder caught up with Whitaker to see how the matter played out.
Q: What was at stake in this dispute with PNY Technologies?
A: A number of years ago, SanDisk and PNY were involved in patent litigation that was resolved when SanDisk and PNY entered into a license agreement. PNY paid almost none of the amounts it owed under the license. SanDisk brought this lawsuit against PNY to enforce the license and collect millions of dollars in unpaid royalties owed by PNY.
Q: Why did this case go to trial?
A: SanDisk is committed to safeguarding and defending its investment in intellectual property, and will enforce the terms of licenses when we are forced to. Simply put, this case went to trial because PNY refused to fulfill its royalty obligations, despite enjoying for years the benefits of its license to SanDisk’s valuable patents. Taking this action was also fair to those licensees that respect their obligations.
Q: What are your thoughts, more broadly, on having an IP dispute tried in state court?
A: Juries are amazingly capable of evaluating evidence and credibility, and juries in Silicon Valley are certainly capable of understanding and evaluating complex issues and claims such as those at issue in this case.
Q: How did the jury respond to Skadden Arps’ Allen Ruby?
A: Allen Ruby is deservedly recognized as an excellent trial lawyer. He clearly connected well with the jury and did a great job explaining difficult technical issues to them. SanDisk very much appreciates the outstanding work that he and his team did in this case.
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