Court rules Apple, Samsung do not have to disclose financial information
A U.S. appeals court overturned a lower court ruling requiring Apple (NASDAQ: AAPL) and Samsung to disclose financial information submitted to the court as part of their smartphone patent litigation.
"We recognize the importance of protecting the public's interest in judicial proceedings and of facilitating its understanding of those proceedings. That interest, however, does not extend to mere curiosity about the parties' confidential information where that information is not central to a decision on the merits," the three-judge appeals panel ruled.
"We hold that the district court abused its discretion in refusing to seal the particular documents that Apple and Samsung challenge in these appeals," the appeals court concluded.
A number of media groups, including the First Amendment Coalition, had sought disclosure of the financial information and other evidence from the patent trial, which netted Apple more than $1 billion for patent infringement on the part of Samsung, an award that was subsequently reduced by $450 million by the judge.
The judge in that case had ruled that financial information submitted by Apple and Samsung related to the case could be disclosed to the public. The two firms put aside their patent dispute and joined in appealing the judge's ruling, arguing that trade-secret law protected their information.
One of the media groups, Reporters Committee for Freedom of the Press, submitted a friend-of-the-court brief in which it argued that the two firms' interpretation of trade-secret law was too broad.
"If the parties had their way, a blanket prohibition on unsealing trade secrets, grounded in a broad definition of the term, would carry the day. Demonstrable trade secrets can in appropriate circumstances provide a compelling reason for a court to seal documents, and this principle has echoed through intellectual property cases. This court should reject unchecked use of trade-secret protection to deny public access to judicial documents in high-profile, big-money litigation," the brief argued.
The appeals court disagreed, ruling that Apple and Samsung "could suffer competitive harm if this information is made public ... In particular, it seems clear that if Apple's and Samsung's suppliers have access to their profit, cost and market data, it could give the suppliers an advantage in contract negotiations."