Netlist, Inc. V. Samsung Electronics Co, Ltd Et Al

Case Background

On August 1, 2022, Plaintiff Netlist, Inc. filed a Patent Infringement lawsuit in the United States District Court for the Eastern District of Texas, Marshall Division(Case number: 2:22cv293). District Judge Rodney Gilstrap presided over this case.

Cause

Netlist, Inc., a leading innovator in high-performance memory technology, filed a patent infringement lawsuit on August 1, 2022, against Samsung Electronics Co., Ltd., Samsung Electronics America, Inc., and Samsung Semiconductor, Inc. (collectively referred to as Samsung) in the U.S. District Court for the Eastern District of Texas. Netlist accused Samsung of infringing U.S. Patent No. 7,619,912 (“’912 patent”), which pertains to advanced memory module technology, specifically rank multiplication.

This technology enhanced memory module capacity by enabling multiple physical ranks of memory devices to present as fewer virtual ranks. This is critical for high-performance computing, cloud-based applications, and data-intensive operations. Netlist claimed that Samsung manufactured, used, sold, offered for sale, and imported DDR4 Load-Reduced Dual In-line Memory Modules (LRDIMMs) and DDR4 Registered Dual In-line Memory Modules (RDIMMs). These products employed the patented technology without authorization. Netlist further emphasized that Samsung knowingly engaged in these activities in the U.S. This occurred particularly in Texas, where Samsung operated facilities and conducted business through its subsidiaries.

Injuries

Netlist suffered substantial harm due to Samsung’s patent infringement. Samsung’s unauthorized use of the ‘912 patent directly undermined Netlist’s competitive advantage and limited its ability to license the patented technology. By introducing infringing DDR4 LRDIMMs and RDIMMs into the market, Samsung deprived Netlist of significant licensing revenue and customer opportunities.

Moreover, Netlist experienced reputational damage within the memory technology industry as Samsung’s infringement misled consumers into associating Samsung’s products with Netlist’s proprietary innovations. The ongoing patent infringement further exacerbated financial losses, eroding Netlist’s market share and hindering potential partnerships that would have emerged from its exclusive ownership of the rank multiplication technology.

Damages

Netlist sought significant financial compensation for the damages caused by Samsung’s patent infringement. These damages included lost sales, diminished market opportunities, and the loss of licensing revenue from its groundbreaking memory technology. Netlist argued that Samsung’s continued infringement, despite awareness of the ’912 patent, constituted willful misconduct.

The infringement had ongoing financial consequences, placing strain on Netlist’s research and development and its ability to innovate in the competitive memory market. Netlist demanded not only compensatory damages for its financial losses but also enhanced damages to account for Samsung’s willful violation of patent laws. Furthermore, Netlist sought reimbursement for attorneys’ fees, interest, and other legal costs incurred in the patent infringement lawsuit to mitigate the financial burden caused by Samsung’s actions.

Key Arguments and Proceedings

Legal representation

  • Plaintiff(s): Netlist, Inc.
    • Counsel for Plaintiff: Jason G Sheasby | Alvin Matthew Ashley | Andrew Henderson | Andrew J. Strabone | Anthony Q Rowles | Benjamin Monnin | Dovid Z. Kahn | Ericka DiMeglio | Hong Annita Zhong | Jennifer Leigh Truelove | Jonathan Michael Lindsay | Justin Kurt Truelove | Kevin Lee Burgess | Lisa Sharrock Glasser | Michael David Harbour | Michael William Tezyan | Nora Isabella Chestney | Philip J Warrick | Rebecca L. Carson | Stephen M Payne | Thomas C Werner | Yanan Zhao | Samuel Franklin Baxter
  • Defendant(s): Samsung Electronics Co, Ltd | Samsung Electronics America, Inc. | Samsung Semiconductor Inc
    • Counsel for Defendants: Ruffin B. Cordell | Alice Juwon Ahn | Amy Riley Lucas | Anton Metlitsky | Brian Livedalen | Brian R. Nester | Bryan James Cannon | Christopher William Dryer | Daniel Aaron Tishman | Francis J. Albert | Grant K. Schmidt | James Lee Huguenin-Love | James Travis Underwood | Jon Bentley Hyland | Jonathan Benjamin Bright | Karolina Jesien | Katherine Reardon | Kathryn Ann Quisenberry | Lauren A. Degnan | Marc J. Pensabene \ Matthew Mosteller | Melissa Richards Smith | Michael J. McKeon | Mike Yoder | Thomas Howard Reger II

 Claims

Netlist asserted that Samsung directly infringed at least one claim of the ’912 patent by manufacturing, using, selling, and importing infringing DDR4 LRDIMMs and RDIMMs into the United States without permission. Netlist sought a declaration from the court that Samsung’s actions amounted to patent infringement and requested monetary compensation under 35 U.S.C. § 284 for all resulting damages. Additionally, Netlist demanded enhanced damages based on Samsung’s willful infringement and attorneys’ fees under 35 U.S.C. § 285, contending that this case was exceptional due to Samsung’s deliberate violation of patent law.

Netlist also requested an injunction to prevent further infringement. Additionally, they sought an accounting of all infringing activities. This accounting would be used to calculate supplemental damages. Netlist also requested pre- and post-judgment interest. They aimed to ensure that Samsung would be held fully accountable for its unauthorized use of Netlist’s technology.

Defense

The Samsung US Defendants denied infringing any valid or enforceable claims of the Patents-In-Suit under any theory of infringement. They maintained that they had not directly or indirectly infringed the patents, either literally or under the Doctrine of Equivalents, and that they had not committed any violations of 35 U.S.C. § 271.

The defendants argued that each asserted claim of the Patents-In-Suit was invalid. They claimed the patents failed to meet various requirements of U.S. patent law. This included non-compliance with sections 35 U.S.C. §§ 101, 102, 103, and/or 112, along with associated rules, regulations, and laws. Samsung further contended that Netlist’s attempt to enforce the Patents-In-Suit was barred by doctrines such as laches, estoppel, and waiver. They claimed that if the patents were essential to JEDEC standards, Netlist was estopped from enforcing them. This was due to Netlist’s failure to comply with RAND obligations. They also argued that Netlist would be prevented from seeking an injunction or lost profits because of these same RAND obligations.

In addition, the defendants raised several other defenses, asserting that Netlist’s claims were barred by prosecution history estoppel based on statements made during the patent application process. They contended that Netlist’s complaint failed to state a claim upon which relief could be granted and that Netlist lacked standing to assert the Patents-In-Suit. They also challenged Netlist’s potential damages, arguing that Netlist had failed to properly mark products and that the claims were statutorily restricted under patent law.

The defendants reserved the right to amend their defenses as more information became available through the discovery process.

Jury Verdict

The jury found that Netlist did not prove by a preponderance of the evidence that Samsung infringed claims 1, 2, and/or 8 of the ‘419 Patent, claims 1 and/or 5 of the ‘908 Patent, and claims 1, 2, and/or 5 of the ‘912 Patent. However, the jury awarded Netlist $94,000,000 in damages for Samsung’s infringement of claims 1, 2, and 8 of the ‘419 Patent, $13,000,000 for infringement of claims 1 and 5 of the ‘417 Patent, and $12,000,000 for infringement of claims 1, 2, and 5 of the ‘608 Patent. The total damages awarded to Netlist amounted to $119,000,000.

Court Documents:

Available Upon Request