John Quinn, Quinn Emanuel Urquhart & Sullivan
John Quinn, Quinn Emanuel Urquhart & Sullivan (Jason Doiy)

SAN JOSE — Quinn Emanuel Urquhart & Sullivan escaped the most severe sanctions sought by its adversaries for a discovery leak that placed details of Apple’s licensing deal with Nokia in the hands of client Samsung. But the firm, known for its swagger, emerges from a bruising six-month sanctions fight with a chink in its reputation as a lean fighting machine.

Quinn’s famously spare structure, where associates work with minimal supervision, opened the door to a breach that went unremedied for more than a year and exposed Apple’s confidential business information to hundreds of unauthorized individuals, U.S. Magistrate Judge Paul Grewal concluded in a 19-page order sanctioning both the firm and Samsung for violating a court protective order.

The San Jose-based judge ordered Quinn to cover the expenses that Apple, Nokia and their lawyers ran up litigating the matter. Grewal also laid new ground rules for Apple and Samsung’s long-running patent brawl, requiring lawyers for each company to exchange redacted documents for approval before distributing them more widely.

The discovery breach arose in March 2012 when a Quinn Emanuel associate failed to omit confidential licensing terms from a lengthy expert report while working late one night.

“A junior associate missing one redaction among many in an expert report is not exactly a historical event in the annals of big-ticket patent litigation,” Grewal opened his order. “But when such an inadvertent mistake is permitted to go unchecked, unaddressed and propagated hundreds and hundreds of times by conscious­—and indeed strategic—choices by that associate’s firm and client alike, more significant and blameworthy flaws are revealed.”

After Quinn Emanuel shared the improperly redacted expert report with Samsung, it reached more than 200 people, many of whom had little involvement in the Apple case, Grewal wrote. In late 2012, another junior associate detected the redaction error and reported it to a senior associate, but the firm took no further action.

For that, Grewal placed blame on Quinn Emanuel’s lean structure, which firm founder John Quinn has described as “650 lawyers wide and one lawyer deep.”

“In cases of this complexity, relying on such a structure to manage highly confidential information from both parties and non-parties is akin to a trapeze artist flying high without a net,” Grewal wrote.

The sanctions fell short of the penalties requested by Apple and Nokia, which included an injunction against Samsung in the South Korean company’s upcoming patent trial with Apple and an order barring Quinn Emanuel from representing parties going up against Nokia. Grewal wrote that many of those proposals were “ludicrously overbroad.”

The leak came to light after a Samsung executive referenced the confidential licensing figures in negotiations with Nokia. According to a declaration filed in the case, the Samsung executive admitted he had received the information through his attorneys.

However, Grewal said after reviewing more than 20,000 pages of documentary evidence he was not persuaded that Samsung used the unredacted report for an advantage in litigation or negotiations. “His opinion should put an end to the unsupported accusations that fueled this inquiry,” John Quinn wrote in an email to The Recorder. “We welcome the final resolution of these issues.”

Even so, Grewal criticized Quinn Emanuel for waiting to notify Apple of the breach, writing that the firm had acted “as though hoping that would make the problem go away.”

To ensure a uniform approach to litigation, Samsung circulates documents among employees across the globe, Grewal wrote. That strategy can be dangerous if something slips through, he noted.

“Having adopted this attitude of share-and-share-alike which allowed the leaked information to spread so far, Samsung is as culpable for this debacle as Quinn Emanuel,” he wrote.

Grewal also questioned why Quinn Emanuel did not treat documents it fought so hard to keep under seal with more care. Throughout their fiercely fought litigation, Apple and Samsung stood united in a push to shield sensitive information and won a ruling from the U.S. Court of Appeals for the Federal Circuit last August that blocked the disclosure of several court filings.

“If keeping this information from the public is worth all of that,” Grewal wrote, “then surely, logically, it would be worth a second, or even a third, round of review before producing it to a competitor corporation, who would know exactly how to exploit it.”

Contact the reporter at jlove@alm.com.