Fed. Cir. Weighs in on Sealing Issue in Uniloc-Apple Patent Dispute

In a precedential decision issued Wednesday, the Federal Circuit Court of Appeals opined on a procedural issue concerning the sealing of third-party patent licensing information. The collateral appeal came from Uniloc USA Inc. and Uniloc Luxembourg S.A., and argued that the district court erred in refusing to seal certain documents in five related cases between the company and Apple Inc.

The opinion notes that this is the case’s second trip to the Federal Circuit concerning a nearly identical issue. Previously, Uniloc attempted to defend requests to seal matters of public record, like quotes from court opinions and a list of patent cases Uniloc had filed. The Northern District of California rejected those requests and the Federal Circuit affirmed.

However, the appellate court also held that the district court must conduct a more detailed analysis on whether “confidential licensing information of certain third-party licensees of Uniloc’s patents should be sealed.” The opinion said that the lower court needed to make particularized determinations as to whether these potentially sensitive materials should be made public.

In the second appeal, Uniloc contested the district court’s decision to deny its motion to redact or seal information including the financial terms of 109 licenses between third-party licensees and Uniloc, the appellant’s opening brief said.

The district court reportedly declined Uniloc’s second request to seal the third-party information on the basis that “the public has a strong interest in knowing the full extent of the terms and conditions involved in the exercise of its patent rights and in seeing the extent to which the patentee’s exercise of the government grant affects commerce,” as described by Wednesday’s opinion. Notably, the Electronic Frontier Foundation (EFF) intervened in defense of the trial court’s decision.

In this week’s opinion, the Federal Circuit overturned the ruling, finding it an abuse of discretion. Specifically, the panel held that the court did not make particularized determinations as directed. Its analysis neglected to make sufficient findings, the opinion said, pointing out that “[n]owhere in the record does the district court discuss whether any of the third-party materials constitute protectable trade secrets.”

“The parties are in agreement that license information here should be sealed and protected. The only differing voice has come from an independent nonparty, appointed by the district court to advocate unsealing the information that neither party wished to unseal,” the opinion noted.

Citing concerns over protecting license information, the court once again remanded with a directive for the district court to “carry out the examination this court instructed it to do.”

Uniloc is represented by Prince Lobel Tye LLP, Apple by Wilmer Cutler Pickering Hale and Dorr LLP, and the EFF by its own counsel.