SK Hynix Inc. v. Rambus, Inc., 2013 WL 1915865 (N.D. Cal. May 8, 2013).
In this complex set of patent-infringement cases, the plaintiffs sought spoliation sanctions against the defendant—who prevailed in the underlying suit but participated in three “shred days” to destroy harmful documents before impending litigation. In an earlier opinion on remand, the court held that the patents were valid, but that spoliation had nonetheless occurred. The court further chose to strike from the record evidence supporting non-discriminatory royalty payments from the plaintiffs to the defendant as a sanction, and ordered the parties to brief the court on what a reasonable royalty rate would be. Reviewing the rates submitted, the court concluded that a monetary sanction calculated from the royalty rates paid by the plaintiffs’ primary competitors was a “more appropriate way to mitigate prejudice” to the plaintiffs. Using the rates negotiated with the plaintiffs’ competitors during the time period under question, the court calculated a $250 million total. The court further found that the calculated total struck “the appropriate balance” between recognizing the defendant’s valid patents and its spoliation without utilizing dismissal, and levied that amount against the $349 million in damages previously awarded to the defendant.