Dell Claims LCD Maker Duped Court About Defense Witness

, The Litigation Daily

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Class action plaintiffs lawyers may be busy tallying up the settlements they've won in the sprawling San Francisco antitrust litigation over flat panel liquid crystal displays, but the fight is still in full swing for the many LCD purchasers, like Dell Inc., that opted out of the class to pursue their own price-fixing claims. Earlier this month Recorder sibling publication The Am Law Daily described Dell's attack on a class action settlement with Toshiba Corp. On Friday Dell and its lawyers at Alston & Bird and Farella Braun & Martel set their sights on another defendant, AU Optronics Corp., accusing its lawyers at Nossaman and Sedgwick of misleading the court about AUO's dealings with a potential key witness.

In a motion seeking sanctions, Dell alleges that partners at Nossaman and Sedgwick falsely claimed for a year that they couldn't locate a former Dell employee, only to spring the witness on Dell's lawyers at the last possible moment. According to Dell, emails show that during the period when the witness supposedly couldn't be found, AUO's lawyers met him for pricey dinners to discuss litigation strategy.

Following in the footsteps of the Department of Justice and class action lawyers, Dell sued AUO and four other Asian LCD manufacturers for price-fixing in 2010. The lawsuit was lumped into the massive multidistrict litigation before U.S. District Judge Susan Illston in San Francisco. Defense lawyers convened in Austin and Palo Alto in late 2011 to depose a prearranged list of 12 witnesses over two weeks. In the middle of that marathon deposition session, the defendants jointly announced that they wanted to add former Dell employee Eric Korman to its list of witnesses. Dell's lawyers called the move an ambush, and urged the special master overseeing discovery to block the deposition. The special master agreed at first, but later allowed Korman to testify. That decision was based on assertions by AUO's lawyers that they had only recently tracked down Korman's address, and that they didn't realize until late 2011 that he would be a useful defense witness.

In Friday's motion, Dell alleges that recently produced emails show that Nossaman partners Christopher Nedeau and Carl Blumenstein and Sedgwick partner Micheal Healy concealed a relationship with Korman that dates back to February 2010. "For more than two years, counsel for AUO knew Mr. Korman's address and multiple phone numbers, met with Mr. Korman in the United States and Taiwan dozens of times, [and] strategized with Mr. Korman about whom to depose at Dell and potential witnesses in the litigation," the motion asserts. "They nevertheless led the special master and this court to believe that they had been unable to locate Mr. Korman. The misrepresentations are material and manifold."

Dell's lawyers urged Illston to either block Korman's testimony at trial or instruct the jury about "Korman's relationship with defendants and the misrepresentations made to the court and Dell in an attempt to conceal that relationship." They also encouraged Illston to refer the matter to a disciplinary committee.

Nedeau, Blumenstein and Healy didn't respond to requests for comment. An AUO spokesperson also didn't immediately respond to a request for comment.

Nossaman and Sedgwick also represented AUO in a criminal price-fixing case brought by the DOJ. A jury convicted AUO and two of its officials in March, but acquitted two others. On Friday Illston ordered the company to pay a $500 million criminal fine.

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