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Ninth Circuit:
Order to Apple for Discovery, in Anticipation of Foreign Patent Action, Is Not Appealable
By a MetNews Staff Writer
The Ninth U.S. Court of Appeals held yesterday that an order granting a petition by an Australian company for discovery against Apple Inc. in anticipation of a yet-to-be-filed patent infringement action in Germany—under a statute providing federal judges with discretion to do so—is not an appealable final judgment where the scope of discovery remains open and hotly disputed.
Undecided the question of whether Apple might be required to turn over its source code—the fundamental blueprint of any computer program—relating to certain of the company’s security features. The District Court found that the technology company would be required to produce it if “no other information is available.”
At issue is 28 U.S.C. §1782, which provides that “[t]he district court of the district in which a person resides or is found may order him to give his testimony or statement or to produce a document or other thing for use in a proceeding in a foreign or international tribunal.”
Seeking the discovery is CPC Patent Technologies Pty Ltd., an Australian investment company focused on biometric technology including mobile device security. In April 2021, CPC filed an ex parte motion for judicial assistance seeking §1782 discovery against Apple for use in the anticipated foreign litigation arising out of allegations that the U.S. company’s security features infringe on patents in the CPC portfolio.
CPC sought to serve Apple with a subpoena for 15 categories of documents “sufficient to describe” the functionality of various aspects of Apple’s biometric security technology.
Motion Granted
After initial skirmishing by the parties, including an interim appeal decided by the Ninth Circuit, District Court Judge Jon S. Tigar of the Northern District of California granted the discovery request, concluding that CPC indisputably met the eligibility requirements and that the governing factors weighed in the Australian company’s favor.
CPC served its subpoena on Apple in October 2023. Apple responded, objecting to the requests “to the extent [they] require[d] the production of source code or other highly confidential technical documentation” and filed this appeal on Nov. 10, 2023.
Tigar granted a request by Apple to stay the proceedings pending the current appeal.
Circuit Judge Daniel A. Bress authored yesterday’s opinion dismissing the appeal for lack of jurisdiction. Bress said that in most §1782 cases, the court has “simply stated” that it has jurisdiction over such orders without providing analysis and wrote:
“In some circumstances, it may be that the granting of a § 1782 application without more concludes the litigation because it is clear what the subpoena is requesting and there is no further objection to producing it. But that is not the case here. Indeed, even if we were to affirm the district court’s § 1782 order, we would face the prospect of additional appeals raising further questions about the scope of Apple’s discovery obligations. A central purpose of the finality requirement is to avoid such piecemeal appeals.”
Fundamental Problem
The jurist elaborated:
“The fundamental problem in this case is that…the scope of discovery and type of information that Apple must produce remains undetermined. The district court’s § 1782 order allowed CPC to serve its subpoena on Apple, to which Apple has served responses and objections. The document requests asked Apple to produce materials ‘sufficient to describe’ certain information about Apple’s biometric technologies. But what those documents are or will be remains unclear, and Apple has lodged objections to the requests that remain unresolved.”
Under those circumstances, Bress opined that “it cannot be said that the district court’s § 1782 order ‘ends the litigation on the merits,’…‘places the parties effectively out of federal court,’…or results in ‘the district court disassociat[ing] itself from the case entirely…’ ” as required of orders deemed to qualify as final judgments.
Circuit Judges Milan D. Smith Jr. and Jacqueline Nguyen joined in the opinion.
The case is CPC Patent Technologies Pty Ltd. v. Apple, 23-3449.
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