A new decision out of California will be of interest to both trade secret and e-discovery lawyers: Gabriel Tech. Corp. v. Qualcomm Inc., 2013 WL 410103 (S.D.Cal. Feb. 1, 2013). The court awarded fees to the prevailing defendant under both 35 U.S.C. §285 and §3426.4 of California’s Uniform Trade Secrets Act. The amount of the total award was a whopping $12,464,331.01. (You would think they might have rounded off the penny.)

The award was made because of the plaintiffs’ “frivolous claims and misconduct during litigation.” The court found strong evidence of bad faith in e-mails between employees and former employees. The e-mails suggested “that [the p]laintiffs knew they lacked the requisite evidence,” but pursued their claims anyway. Plaintiffs bringing frivolous claims of any sort should get the message. The truth is out there, and good lawyers will find it, even when hidden in millions of e-mails.

From an e-discovery perspective, the opinion was most interesting for the award of more than $3 million for costs associated with e-discovery, especially for predictive coding services — a new kind of advanced search technique that Jackson Lewis LLP is well-known for pioneering. The defense counsel in Gabriel apparently could not do the advanced analytics work on their own. So they hired a vendor to do the advanced analytics searches for them. The court described the outside expert’s work as “computer-assisted, algorithm-driven document review.”

Here is the work-flow chart for the type of machine-learning predictive coding that Jackson Lewis uses and for which all of our e-discovery liaisons – more than 30 in all – receive training. (I would be happy to explain it to those interested at any time.)

Click here to view flowchart.

The outside experts in Gabriel did a computer-assisted search using a different method, called rule-based, that uses a team of linguistic experts. They searched one million documents to determine which were most likely relevant. The rest were put aside. This is called first-pass review. Then contract lawyers under defense counsel’s supervision made final determinations on the documents predicted to be relevant, and coded and redacted them for privilege and confidentiality. The contract lawyers were paid $391,928.91 for their work, but the predictive coding experts were paid a breathtaking $2,829,349.10. Surprisingly, the losing plaintiff did not object, and so the court awarded the full amount