A Blog About Intellectual Property Litigation and the District of Delaware

Entries for tag: Privilege

An AI rendering of an object that is both a sword and a shield. I can't argue with it.
An AI rendering of an object that is both a sword and a shield. I can't argue with it. AI-Generated, displayed with permission

There are certain exclusion arguments that stand out as tending to work more often than others—things like a Rule 702 motion for failure to apportion, a motion to exclude a Doctrine of Equivalents argument offered for the first time in a reply expert report, or a motion to exclude an exhibit not on the exhibit list. It's not that they win every single time, but parties often seem to have an uphill battle against them.

Another argument on that list is "using privilege as a sword and a shield." It's not uncommon for a party to get …

David von Diemar, Unsplash

Today Judge Burke unsealed an opinion with a great discussion of what it takes to make a "prima facie" showing, at least as to the crime/fraud exception to attorney-client privilege (that's something you don't see every day).

According to the Court, the rules require it to hold a hearing on the crime/fraud exception, but only if the plaintiff first makes a prima facie showing that the exception applies.

The Court first reviewed plaintiff's evidence, and found that plaintiff had showed that the exception applied. The Court also found, however, that defendant's additional, different evidence that showed that the exception did not apply. On the whole, the Court sided with the defendant, finding that, in light of all of the evidence, the crime/fraud exception does not apply.

But that wasn't the end! The Court still found that it must hold an evidentiary hearing on the crime/fraud exception. Why? Because none of the defendant's additional evidence matters in determining whether plaintiff made a prima facia showing that a hearing must be held. Instead, the Court must ignore the non-movants' evidence and look just at the movant's evidence:

With the Court having said all of the above, the question then becomes: In resolving the instant Motion, what is the Court’s proper role? Is the Court supposed to look only at the evidence put forward by Plaintiffs and determine whether that evidence, standing alone, would make out a prima facie case? Or is it supposed to take into account all of the evidence provided to it, including that submitted by Defendants, in making a decision on the issue at this stage?
In Haines, the Third Circuit explained that the prima facie case inquiry is one where the court asks “[H]as the party seeking discovery presented evidence which, if believed by the factfinder, supports plaintiff’s theory of fraud?” 975 F.2d at 95 . . . . In doing so, the Haines Court cited approvingly to a decision from the United States Court of Appeals for the Fifth Circuit, which explained that “prima facie evidence” in this context is “[evidence] [s]uch as will suffice until contradicted and overcome by other evidence . . . [a] case which has proceeded upon sufficient proof to that stage where it will support [a] finding if evidence to the contrary is disregarded.” Id. . . .
In the Court’s view, these portions of Haines make clear that in determining whether a movant has made out a prima facie case, the Court must only assess the strength of the evidence presented by the movant. . . . Or, to put it differently, the Court’s job at this point is not to take the movant’s evidence and consider it alongside with any contrary evidence put in the record by the non-movant, and then to make a decision as to whether a prima facie showing has been made (or whether a preponderance of the evidence supports Plaintiffs’ claim).

ECB USA, Inc. v. Savencia, S.A., C.A. No. 19-731-GBW-CJB (D. Del. January 4, 2024).

Fascinating! It's always enlightening when the Court parses the meaning of a term like "prima facie" this closely. I have to wonder if this logic could apply in other contexts, such as a prima facie showing of authenticity at trial.

I'm definitely making a mental note to refer back to this next time I need to make a prima facie showing of something—although we'll have to see if the opinion ends up being cabined exclusively to the crime-fraud exception.

The privileges of working in the gig economy are too numerous to recount here. There's the freedom to set your own hours, the joy of being constantly rated on how cheerful (yet obsequious) you appear, and avoiding all of the complicated headaches that go with having health insurance and a retirement plan.

Hold it together Hoeschen, if you cry on the job again its back in the chokey
Hold it together Hoeschen, if you cry on the job again its back in the chokey AI-Generated, displayed with permission

Well I have even more good news for you! Judge McCalla held just last week that at least some of you also enjoy the attorney-client privilege.

The defendant in Torvent LLC v. Techtronic Industries Co., Ltd. C.A. No. 21-853-JPM, D.I. 208 (D. Del. Jan. 11, 2024) was a startup with only a token staff of actual employees. In lieu of a permanent staff, they retained a large number of contractors for "various accounting and secretarial functions" and "consultants relat[ing] to licensing and damages issues." Id. at 6.

The dispute here arose because the defendant claimed privilege over a few thousand communications with these contractors. The plaintiff argued that these communications were not privileged because these were with third parties, rather than employees. The parties agreed that many of these contractors were functionally identical to employees. They disputed whether communications with these "functional equivalents" are entitled to the same privilege protections as actual employees.

Judge McCalla held that ...

The Climate Reality Project, Unsplash

We've written before about the risks of a deponent consulting with counsel during a deposition. This week, visiting Judge Wolson ordered a deposition reopened after counsel did just that:

AND NOW, this 27th day of November, 2023, upon consideration of Stragent’s Motion For Sanctions Against VCUSA Pursuant To Fed. R. Civ. P. Rule 30(d)(2) For VCUSA’s Violation Of Local Rule 30.6 And Established Law (D.I. 100), and for the reasons set forth on the record during a hearing with the Parties, it is ORDERED that the Motion is GRANTED IN PART and DENIED IN PART as follows:
1. The Motion is GRANTED, to the extent Stragent seeks to reopen the deposition of [the deponent] …

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愚木混株 cdd20, Unsplash

We got a good "what not to do" example today, relayed in an opinion by Judge Williams.

In the opinion, the Court addressed objections to a magistrate judge ruling on a privilege issue (remember—you can object to non-dispositive magistrate judge rulings in addition to R&Rs. Good luck.).

As the Court explained, the defendants initially argued to the magistrate judge that Third Circuit law governed, and that Federal Circuit law was grounded in the same principles as Third Circuit law anyway. The magistrate judge agreed:

In briefing submitted to the Magistrate Judge, Defendants state that, "Federal Circuit [law] does not differ [from Third Circuit law] in that it 'is grounded in principles of fairness. '" D.I. 224 at 3. The Magistrate Judge credited Defendants' argument to conclude Third Circuit law applies. See D.I. 232 at 3 n.2 ("Because Defendants themselves initially relied on Third Circuit caselaw here (as did Plaintiff) and because Defendants assert that the Third Circuit's approach to this issue is no different from that of the Federal Circuit, the Court will herein apply Third Circuit law regarding the 'at issue' doctrine to this patent case." ).

Then, in objecting to the magistrate judge's ruling, the defendants apparently reversed position, arguing that Federal Circuit law differed, and that the magistrate judge had erred by relying on

Douglas Lopez, Unsplash

How, in the 8,000 year history of law, have we not come up with a better name than the "at issue" doctrine? I hesitate to call it the shame of our profession, but it's firmly in the running.

I pose some alternatives below. To make it clear, any highlighted words refer to the doctrine formerly known as "at issue." Feel free to use going forward -- creative commons or whatever.

This Will Go On For Longer Than You Think

Judge Burke had an interesting case regarding the sneaky peak doctrine. In Sensormatic Electronics, LLC v. Genetec (USA) Inc., the issue arose in the context of an inequitable conduct allegation, where defendants sought evidence about what exactly …

Something is missing here.
Something is missing here. Pawel Czerwinski, Unsplash

A recent privilege decision from Judge Fallon became public this week, after the redactions period expired, and it has some interesting conclusions about communications between patent prosecution and patent litigation counsel.

In Huber Engineered Woods LLC v. Louisiana-Pacific Corp., C.A. No. 19-342-GBW-SRF (D. Del.), the defendant accused infringer brought an inequitable conduct counterclaim, alleging that plaintiff knowingly submitted five false "Substitute Statements in Lieue of Oath or Declaration" to the PTO.

As the Court explains, the defendant apparently relied on testimony from the person who signed the statements, and from the inventors, to allege that they were false:

These Substitute Statements, which were signed by [plaintiff] HEW employee Dave …

Illustration of the stone wall plaintiff will face when they actually depose this person.
Illustration of the stone wall plaintiff will face when they actually depose this person. eberhard grossgasteiger, Unsplash

In The United States of America v. Gilead Sciences, Inc., C.A. No. 19-2103-MN (D. Del.), plaintiff moved to compel defendant to produce a 30(b)(6) witness on various topics, including on "[a]ll bases" for certain statements by defendant's CEO, including statements about a decision not to challenge the validity of certain patents.

As to two of those topics, the defendant argued in its responsive letter that the CEO's statements were "based entirely on communications and memoranda prepared by Gilead’s in-house counsel and outside counsel," which are privileged. The Court generally agreed:

[T]he Court definitely acknowledges Defendants' point[, ]i.e., …

Not this kind of camera
Not this kind of camera Jakob Owens, Unsplash

Judge Hall issued a detailed privilege opinion last week, finding no privilege or work product protection for a number of documents after an in-camera review (while also finding that some others were privileged).

There are a number of useful holdings in the opinion. Some of the disputes arose in part because the custodian of the documents in question was unavailable, which means that the producing party lacks context for many of the documents.

For that reason, the producing party was unable to defend against production by offering a declaration that a document was prepared in anticipation of litigation, and the opinion resolves many of the disputes based purely on the text …

Hans Reniers, Unsplash

On Friday, Judge Andrews issued an opinion adopting a Special Master opinion, which held that certain pre-litigation testing documents were not covered by attorney privilege.

Pre-Litigation Testing Not Protected by Attorney-Client Privilege If Not Provided to Attorneys

The Court found that the pre-litigation scientific testing was not covered by attorney-client privilege, even though they may have been done "at the direction of" a law firm, because the core purpose was for the client's understanding rather than for facilitating legal advice:

I do not think [plaintiff] First Quality has shown that the attorney-client privilege applies to any of the [relevant] disputed . . . documents. Plaintiff's position is that everything [the expert] Dr. Malburg did falls "well …