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Huang v. Huawei Technologies Co., Ltd.

United States District Court, E.D. Texas, Marshall Division

March 25, 2017

XIAOHUA HUANG, pro se Plaintiff,
v.
HUAWEI TECHNOLOGIES CO., LTD., Defendant.

          MEMORANDUM OPINION AND ORDER

          ROY S. PAVNE, UNITED STATES MAGISTRATE JUDGE

         Mr. Xiaohua Huang, acting pro se, sued Huawei Technologies Co., LTD. (Huawei) for infringement of U.S. Patent Nos. 6, 744, 653, 6, 999, 331, and RE45, 259, which are generally related to circuits for content addressable memory (CAM). After the Court granted summary judgment of noninfringement and entered final judgment, Huawei moved for attorneys' fees under 35 U.S.C. § 285 and under the Court's inherent power. See Huawei Br., ECF No. 179. For the following reasons, Huawei's motion is GRANTED.

         BACKGROUND

         Mr. Huang owns CMOS Micro Device, Inc. (CMOS), a company headquartered in Silicon Valley. Compl. ¶ 2, ECF No. 1. According to the complaint, CMOS develops and markets CAM technology. Id. The patents-in-suit all relate to CAM circuits and name Mr. Huang as the sole inventor. See ECF No. 1-1. The Complaint alleges that Huawei sells products known as “switches” that include chips covered by the patents-in-suit. Compl. ¶ 3, ECF No. 1.

         Huawei initially responded to the lawsuit by emailing Mr. Huang to request an extension of time to answer the complaint. Li Pengyan Decl. ¶ 3, Jan. 26, 2017, ECF No. 179-1. A few days later, Mr. Huang called Huawei's offices in China and indicated that resolution of the lawsuit was not his goal. Id. ¶ 4. Rather, Mr. Huang asked for an offer from Huawei to purchase the patents-in-suit. Id. Huawei told Mr. Huang that it was not interested. Id. ¶ 5.

         Early motion practice followed. Mr. Huang's original complaint was filed both on behalf of Mr. Huang personally and CMOS, Mr. Huang's company. See Compl., ECF No. 1. But because Mr. Huang is not licensed to practice law, Huawei filed a motion to compel CMOS to obtain legal counsel given the long-standing rule precluding a corporation from proceeding pro se in federal court. See Rowland v. Calif. Men's Colony, 506 U.S. 194, 201-02 (1993); Huawei Mot. 2-3, ECF No. 8. Mr. Huang thereafter filed an amended complaint on behalf of only himself. See Am. Compl., ECF No. 12. Huawei filed additional motions to dismiss, all of which were ultimately rendered moot by Mr. Huang's third amended complaint. See Order dated Sept. 21, 2016, ECF No. 103.

         About six months into discovery, Huawei sent Mr. Huang a Rule 11 safe harbor letter explaining that Mr. Huang's infringement allegations were baseless. See Huawei Rule 11 Br. 2, ECF No. 52. Discovery had revealed that Huawei has never imported into the United States or sold a router or switch containing the particular type of chip that formed the basis of Mr. Huang's claim. Id. This Rule 11 motion (in addition to numerous motions filed by Mr. Huang to compel discovery) prompted the Court to set a hearing on July 27, 2016.

         It became clear during the July hearing that Mr. Huang would not likely establish a basis for infringement because Mr. Huang could not access necessary technical details concerning Huawei's products. See Hr'g Tr. 3-13, Jul. 27, 2016, ECF No. 183. Huawei had properly designated this technical information “confidential” and “attorneys' eyes only” under the (agreed) protective order. See Id. The protective order precludes Mr. Huang from personally viewing such information because Mr. Huang designs and markets his own CAM technology to Huawei's competitors in China. See, e.g., Huawei Resp. Br. 1-2, ECF No. 117. Mr. Huang would also likely be prevented from viewing related third-party product information that would be necessary to support Mr. Huang's infringement contentions. See Hr'g Tr. 3-13, ECF No. 183.

         The Court explained to Mr. Huang that his pro se status would likely impair if not prevent a successful opposition to summary judgment. Id. Mr. Huang expressed a contrary view. When the Court asked Mr. Huang if he had “any ideas to offer about how to get around the problem of sharing confidential information with your side of the case without an outside lawyer, ” Mr. Huang responded, “In fact, I do not need to see any so-called confidential information from Huawei.” Id. 13:19-14:9. According to Mr. Huang, a contract between Huawei and a supply company and various Huawei chip model numbers would be enough. Id. 14:1-9. The Court sought clarification: “And you're saying that you believe that you can prove your case with just the model number of the chip and a copy of the contract between Huawei and [the supply company]?” Id. 16:7-10. “Yes, your Honor, that's enough.” Id. 16:11. Mr. Huang intended to reverse engineer the accused chips, an endeavor that Mr. Huang acknowledged would be very costly. Id. 20:1-22.

         The Court took Mr. Huang's representations that he did not require confidential information with caution and stayed the case for 60 days to allow Mr. Huang time to find legal counsel, while deferring Huawei's Rule 11 motion. Id. 26:9-13. Mr. Huang never attempted to hire counsel as far as the record reflects. Rather, Mr. Huang proceeded undeterred. Only about two weeks after the July hearing-while the case was stayed-Mr. Huang began filing numerous motions to compel Huawei to produce the very type of information the Court had determined to be properly designated as “attorneys' eyes only.” See ECF Nos. 94, 95, 96. Mr. Huang's discovery motions were denied without prejudice in light of the stay, see ECF No. 99, prompting Mr. Huang to appeal that denial to the district judge, see ECF No. 100. The appeal was unsuccessful. See ECF No. 101. Still undeterred, Mr. Huang filed another civil action based on the same asserted patents along with a motion to consolidate the newly-filed case with the stayed case. See ECF No. 104; Compl. in Case No. 2:16-cv-947, Aug. 26, 2016, ECF No. 1.

         At the conclusion of the 60-day stay, Mr. Huang had not obtained counsel, and Huawei moved for summary judgment. ECF No. 105. The Court recommended granting summary judgment upon finding no evidence to support Mr. Huang's infringement claims. ECF No. 134. After considering Mr. Huang's objections to that recommendation, the District Judge granted summary judgment and dismissed Mr. Huang's case. ECF No. 146. Mr. Huang continued to object to the Court's dismissal Order, ECF No. 148, 163, and eventually filed a notice of appeal to the Federal Circuit on January 19, 2017, ECF No. 173.

         A declaration submitted by Huawei's in house counsel provides a possible explanation for Mr. Huang's persistent litigation conduct. Li Pengyan Decl., ECF No. 179-1. Despite having been asked to only communicate with Huawei through their outside counsel, Mr. Huang has been in constant contact with Huawei's in house counsel throughout the case. Id. ¶ 7. Mr. Huang told Huawei's counsel that he sued Huawei because one of his (lawyer) friends told him that if he were to represent Mr. Huang in a lawsuit against Hauwei, the case would quickly settle for $1.5 million. Id. Mr. Huang said that he nevertheless decided not to hire an attorney because he did not want to share revenue with a lawyer. Id. Even after the Court granted Huawei's motion for summary judgment and dismissed the case, Mr. Huang told Huawei's in house counsel that he would continue filing motions-forcing Huawei to reply and incur further legal fees. Id.

         Among the barrage of documents filed by Mr. Huang are motions and other papers suggesting that Huawei's corporate representatives and Huawei's counsel have not been truthful and that Huawei has engaged in improper behavior. See, e.g., Huang Mot. for Perjury Charges, Jan. 18, 2017, ECF No. 170. As early as the July hearing, Mr. Huang began characterizing Huawei's declarations as “not truthful.” Hr'g Tr. 24:21-23, ECF No. 183. Indeed, Mr. Huang's response to Huawei's Rule 11 motion was that “it is completely baseless; and I'm going to file a motion for Rule 11 to sanction Huawei's improper [conduct].” Id. 23:14-16. Mr. Huang's allegations of untruthfulness culminated with a “motion for perjury charges” filed on January 18, 2017. ECF No. 170.

         Huawei thereafter filed their motion for attorneys' fees. See Huawei Br., ECF No. 179. In part because Mr. Huang continues to represent himself, the Court scheduled a hearing to determine whether Mr. Huang could explain his conduct, why he had chosen not to hire an attorney, and why the Court should not award fees and costs. Mr. Huang appeared at the hearing but offered no satisfactory explanation for his litigation conduct. In fact, Mr. Huang continued to maintain that Huawei's witnesses and lawyers were being untruthful, and that they were committing perjury. In response to these accusations, one of Huawei's attorneys explained that he had personally considered filing a libel or ...


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