any hints here?
4/22/05
order by Whyte
This court's November 24 Order acknowledged that there was identity of issues between the question of spoliation in the Infineon case and the present litigation. As set forth above, Hynix cites that order for the proposition that there has already been a binding ruling that there is sufficient identity of issues to warrant the application of collateral estoppel. However, Hynix overstates the scope of the court's ruling in that order. The court commenced its discussion by setting aside the issue of dismissal on the basis of unclean hands for Rambus's spoliation and considered whether Judge Payne's previous spoliation findings could be the basis for finding that Rambus had engaged in spoliation sufficient to pierce Rambus's attorneyclient privilege. November 24 Order at 2.
at that point, the question of the application of collateral estoppel was necessarily limited to the question of spoliation as Judge Payne had not issued a ruling on the basis of unclean hands. Thus, this court must now determine whether the issue of unclean hands was actually litigated in the Infineon action. Although it is clear that Judge Payne made his determination to dismiss based upon unclean hands,
The unclean hands doctrine "closes the doors of a court of equity to one tainted with inequitableness or bad faith relative to the matter in which he seeks relief." Jarrow Formulas, Inc. v. Nutrition Now, Inc., 304 F.3d 829, 841 (9th Cir. 2002) (citing Precision Instr. Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 814 (1945)). "Application of the unclean hands doctrine requires a finding of inequitableness or bad faith by the party to be dismissed." Rent-A-Center, Inc. v.Canyon Television and Appliance Rental, Inc., 944 F.2d 597, 602 (9th Cir. 1991).
The doctrine of unclean hands does not apply to any misconduct in the abstract, but requires that the misconduct is related to the claim to which it is asserted as a defense. Republic Molding Corp. v. B.W. Photo Utilities, 319 F.2d 347, 349 (9th Cir. 1963) ("What is material is not that the plaintiff's hands
are dirty, but that he dirtied them acquiring the right he now asserts, or that the manner of dirtying renders inequitable the assertion of such rights against the defendant"). The alleged misconduct "must pertain to the very subject matter involved." Id. (citation omitted); accord Dollar Sys., Inc., 890 F.2d at 173 (citation omitted) ("It is fundamental to the operation of the doctrine that the alleged misconduct by the plaintiff relates directly to the transaction concerning which the complaint is made."); Wash. Capitols Basketball Club, Inc. v. Barry, 419 F.2d 472, 478 -79 (9th Cir. 1969) ("The party against whom the doctrine is sought to be invoked directly 'infected' the actual cause of action before the court, and is not merely guilty of unrelated improper past conduct." (citation omitted)).
Absent findings of fact and conclusions of law, this court simply cannot glean from Judge Payne's oral ruling in Infineon the required elements to apply the doctrine of unclean hands in this litigation. Hynix must show that Rambus's misconduct is related to this litigation.
While it is clear he intended to produce a final written decision, absent Judge Payne's findings of fact and conclusions of law or some other more detailed order setting forth the basis for his ruling on spoliation, this court cannot find that Judge Payne's judgment is "supported with a reasoned decision."
Although not a prior inconsistent judgment, the FTC's Chief Administrative Law Judge, after a three-month trial, found that there was no indication that any documents relevant and material to the issues before the FTC were destroyed. In re Rambus, Inc., 2004 WL 390647 at 244 (FTC Feb 23, 2004). Hynix points out that this conclusion is not inconsistent with Judge Payne's ruling because it is the destruction of documents in anticipation of litigation that constitutes unclean hands and not whether relevant and material documents were actually destroyed. Although Hynix's argument has some merit, consideration of the relevance and materiality of any documents likely destroyed may be at least relevant to fashioning an equitable remedy for any unclean hands. See Republic Molding Corp. v. B.W. Photo Utils., 319 F.2d. 347, 350 (9th Cir. 1963).
The court also believes the circumstances surrounding the discovery of the allegedly recently discovered back up tapes, and the contents of those tapes, may shed additional light on the unclean hands issue. This evidence was not before Judge Payne.
