SanDisk 2012 Annual Report Download - page 212

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
This case, including the antitrust counterclaims asserted by Kingston, has been dismissed as part of the
overall settlement between the Company and Kingston.
Patent Infringement Litigation Initiated by SanDisk (United Kingdom). On April 4, 2011, following the
detention by Customs Authorities in the United Kingdom of several consignments of Universal Serial Bus
(“USB”) flash drive products imported by Kingston Digital Europe Limited (“KDEL”), SanDisk IL Ltd. and the
Company commenced patent infringement proceedings against KDEL in the Patents Court in the Chancery
Division of the High Court. The subject matter of the proceedings concerned Kingston USB flash drive products
suspected of infringing three Company patents. The Company sought injunctive relief, damages, costs and
associated remedies in those proceedings. KDEL filed its Defence on May 19, 2011 denying infringement and
seeking revocation of all three patents. Following SanDisk’s application in March 2012, Kingston Technology
Co., Inc. and Kingston were joined as co-defendants.
This case is a part of the overall settlement between the Company and Kingston, and a Consent Order for
discontinuance of the case has been filed at the Patents Court pursuant to standard English Court procedure.
Patent Infringement Litigation Initiated By SanDisk.On October 27, 2011, in response to infringement
allegations by Round Rock Research LLC (“Round Rock”), the Company filed a lawsuit against Round Rock in
the U.S. District Court for the Northern District of California. The lawsuit seeks a declaratory judgment that
twelve Round Rock patents are invalid and/or not infringed by flash memory products sold by the Company.
Round Rock has since withdrawn its allegations of infringement as to three of the patents. A claim construction
hearing was held on January 16, 2013. Discovery is underway and expert discovery has not yet commenced in
the case. Trial is currently scheduled for February 2014.
Patent Infringement Litigation Initiated By Round Rock Research, LLC.On May 3, 2012, Round Rock
filed an action in the U.S. District Court for the District of Delaware alleging that the Company infringed eleven
patents, and subsequently filed an amended complaint alleging that SanDisk’s infringement was willful. The
parties agreed to dismiss one patent from this Delaware lawsuit that was also being litigated in the California
case described above. Discovery is in its early phases, and the parties are scheduled to exchange claim
construction positions on July 19, 2013. Trial is currently scheduled for September 29, 2014.
Ritz Camera Federal Antitrust Class Action. On June 25, 2010, Ritz Camera & Image, LLC (“Ritz”) filed a
complaint in the U.S. District Court for the Northern District of California (the “District Court”), alleging that the
Company violated federal antitrust law by conspiring to monopolize and monopolizing the market for flash
memory products. The lawsuit captioned Ritz Camera & Image, LLC v. SanDisk Corporation, Inc. and Eliyahou
Harari, purports to be on behalf of direct purchasers of flash memory products sold by the Company and joint
ventures controlled by the Company from June 25, 2006 through the present. The complaint alleges that the
Company created and maintained a monopoly by fraudulently obtaining patents and using them to restrain
competition and by allegedly converting other patents for its competitive use. On February 24, 2011, the District
Court issued an Order granting in part and denying in part the Company’s motion to dismiss which resulted in
Dr. Harari being dismissed as a defendant. On September 19, 2011, the Company filed a petition for permission
to file an interlocutory appeal in the U.S. Court of Appeals for the Federal Circuit (the “Federal Circuit”) for the
portion of the District Court’s Order denying the Company’s motion to dismiss based on Ritz’s lack of standing
to pursue Walker Process antitrust claims. On October 27, 2011, the District Court administratively closed the
case pending the Federal Circuit’s ruling on the Company’s petition. On November 20, 2012, the Federal Circuit
affirmed the District Court’s order denying SanDisk’s motion to dismiss. On December 2, 2012, the Federal
Circuit issued its mandate returning the case to the District Court. Discovery is now open in the District Court.
Samsung Federal Antitrust Action Against Panasonic and SD-3C. On July 15, 2010, Samsung Electronics
Co., Ltd. (“Samsung”) filed an action in the U.S. District Court for the Northern District of California (the
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