Elan Microelectronics Corporation v. Apple, Inc.

Filing 161

Memorandum in Opposition re 142 MOTION to Compel James Eakin To Produce Documents Pursuant to Subpoena Duces Tecum filed byElan Microelectronics Corporation. (DeBruine, Sean) (Filed on 8/10/2010)

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Yitai Hu (SBN 248085) ([e-mail]) Sean P. DeBruine (SBN 168071) ([e-mail]) Elizabeth H. Rader (SBN 184963) ([e-mail]) Jennifer Liu (SBN 268990) ([e-mail]) ALSTON & BIRD LLP 275 Middlefield Road, Suite 150 Menlo Park, California 94025 Telephone: [phone] Facsimile: 650-838-2001 T. Hunter Jefferson (admitted pro hac vice) ([e-mail]) ALSTON & BIRD LLP One Atlantic Center 1201 West Peachtree Street Atlanta, Georgia 30309 Telephone: [phone] Facsimile: 404-881-7777 Attorneys for Plaintiff and Counterdefendant ELAN MICROELECTRONICS CORPORATION UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION ELAN MICROELECTRONICS CORPORATION, Plaintiff and Counterdefendant, v. APPLE, INC., Defendant and Counterplaintiff. AND RELATED COUNTERCLAIMS Case No. 09-01531 RS (PVT) ELAN MICROELECTRONICS CORPORATION'S OPPOSITION TO APPLE INC.'S MOTION TO COMPEL JAMES EAKIN TO PRODUCE DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM DATE: TIME: JUDGE: CTRM: September 7, 2010 10:00 p.m. Patricia V. Trumbull Courtroom 5, 4th Floor

I.

INTRODUCTION Elan is the owner of U.S. Patent No. 5,825,352 (the "'352 patent"), which it acquired,

indirectly, from the original assignee, Logitech, Inc. Logitech's communications with its patent attorney, Mr. Eakin, were protected by attorney-client privilege. Only the holder of a privilege can waive that privilege. Elan, through a chain of title, acquired not only the '352 patent but the
ELAN'S OPPOSITION TO APPLE'S MOTION TO COM PEL JAMES EAKIN TO PRODUCE DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM Case No. 09-cv-01531 RS (PVT)

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the touch pad business that was formerly Logitech's. Accordingly, Elan became the current holder of attorney-client privilege attached to the communications made in confidence during the course of relationship between Logitech, Inc. and Mr. Eakin concerning the prosecution of the '352 patent. Elan has never waived any of those privileges. Thus, Apple's request that the Court hold that objections with respect to the attorney-client privilege, and any other applicable privilege, immunity or protection, to a subpoena have been waived, due to the alleged failure on the part of Mr. Eakin to timely object, has no merit and should be denied. Elan requests an opportunity to review for privilege any documents produced by Mr. Eakin pursuant to Apple's subpoena and withhold such documents from the production to Apple. Elan does not oppose Apple's motion to compel with respect to non-privileged documents. II. STATEMENT OF FACTS Logitech Inc. was the original assignee of the '352 patent from its inventor-employees. See Declaration of Sean P. DeBruine In Support of Elan's Opposition to Apple's Motion to Compel James Eakin to Produce Documents Pursuant to Subpoena Duces Tecum, ("DeBruine Decl."), ¶ 2, and Ex. 1. Mr. Eakin is the attorney who prosecuted the '352 patent. See Exhibit A, certain pages of certified file history of the '352 patent, to the Declaration of Nathan A. Greenblatt in Support of Apple's Motion to Compel ("Nathan Decl."). On November 30, 1999, KOA T&T Corporation ("KTT"), Logitech Inc. and Logitech Far East Ltd. entered into an agreement titled "Agreement For The Sale And Purchase Of Assets" ("Asset Purchase Agreement"), in which KTT purchased the touchpad businesses, including the '352 patent and other intellectual property related to the touchpad business. See DeBruine Decl. at ¶ 3. With that purchase, KTT effectively stepped into the shoes of Logitech. The control of this ongoing touchpad business was transferred to new management under KTT. KTT later changed its name to K-Tech Devices Corp. ("K-Tech"). Id. On July 9, 2003, K-Tech formed a joint venture company with Elan, called Elantech Devices Corporation ("Elantech") by injecting its entire touchpad business into Elantech, together with the patents that KTT had acquired from Logitech and certain equipment. Id. Later, Elan bought out K-Tech's interest in Elantech. In 2008, Elantech merged into Elan. Id. Through the above chain of title, Elan obtained all the
ELAN'S OPPOSITION TO APPLE'S MOTION TO COM PEL JAMES EAKIN TO PRODUCE DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM Case No. 09-cv-01531 RS (PVT)

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rights and interests in the '352 patent. On May 12, 2010, Apple served a subpoena duces tecum on Mr. Eakin for the production of certain documents related to the prosecution of the '352 patent. See Nathan Decl., Ex. B. These requests require Mr. Eakin to produce, among other things, certain documents which contain information which is subject to attorney-client privilege. See id., Request Nos. 4, 7, 8, 1417, 20. By way of example, Request No. 4 requests, "Al l doc um e nt s r e l a t i ng t o a n y
communications with L o g i t e c h o r a n y n a m e d i n v e n t o r r e l a t i n g t o t h e s u b j e c t m a t t e r o f t h e ' 3 5 2 p a t e n t , i n c l u d i n g a n y predecessor or successor in interest to an y of the foregoing"; Request No. 7 requests, "Al l docume nts an d t hin gs p repa red b y o r at t he direct ion of the nam ed inventors of the '352 patent relating to the subject matter of any claim of the '352 patent"; Request No. 14 requests, "All documents relating to the scope, validity, infringement, enforceability, i n v e n t o r sh i p o f , a n d / o r c o n s t r u c t i o n o f c l a i m t e r m s ... i n c l u d i n g a n y o p i n i o n s o f c o u n s e l , cl a i m c o n s t r u c t i o n analyses, briefs or decisions...".

Upon notice of Apple's subpoena to Mr. Eakin, Elan promptly, through its counsel, offered to assist Mr. Eakin in responding to Apple's subpoena to preserve any privilege that Elan has with respect to the documents requested. Mr. Eakin declined that offer. See DeBruine Decl. ¶¶ 5-6. Elan has never waived its privilege with respect to Logitech's communications with its attorney or agreed to the production of any privileged material by Mr. Eakin. See id., at ¶ 10. III. A. ARGUMENT Elan Has Standing To Assert Attorney-Client Privilege With Respect To A Third Party's Documents 1. Apple's Subpoena Requests Documents Containing Privileged Communications

Federal Circuit law applies when deciding whether particular written or other materials are discoverable in a patent case, if those materials relate to an issue of substantive patent law. Advanced Cardiovascular Sys. Inc. v. Medtronic, Inc., 265 F.3d 1294, 1307 (Fed. Cir. 2001); In re EchoStar Commc'ns Corp., 448 F.3d 1294, 1298 (Fed. Cir. 2006). The Federal Circuit has held that a request for legal advice or services need not be an express request, nor need the implied
ELAN'S OPPOSITION TO APPLE'S MOTION TO COM PEL JAMES EAKIN TO PRODUCE DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM Case No. 09-cv-01531 RS (PVT)

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request necessarily appear on the face of the document for the document to be covered by attorney-client privilege. In re Spalding Sports Worldwide, Inc., 203 F.3d 800, 805 (Fed. Cir. 2000) (an invention record constitutes a privileged communication, when provided to an attorney for the purpose of securing primarily legal opinion, or legal services, or assistance in a legal proceeding). The requests in Apple's subpoena to Mr. Eakin require the production of certain privileged documents. By way of examples, Request No. 4 requests, "Al l doc um e nt s r e l a t i n g t o a n y
communications with L o g i t e c h o r a n y n a m e d i n v e n t o r r e l a t i n g t o t h e s u b j e c t m a t t e r o f t h e ' 3 5 2 p a t e n t , i n c l u d i n g a n y predecessor or successor in interest to an y of the foregoing"; Request No. 7 requests, "Al l docume nts an d t hin gs p repa red b y o r at t he direct ion of the nam ed inventors of the '352 patent relating to the subject matter of any claim of the '352 patent"; Request No. 14 requests, "All documents relating to the scope, validity, infringement, enforceability, i n v e n t o r sh i p o f , a n d / o r c o n s t r u c t i o n o f c l a i m t e r m s ... i n c l u d i n g a n y o p i n i o n s o f c o u n s e l , cl a i m c o n s t r u c t i o n analyses, briefs or decisions...". These requests will likely contain privileged documents of Elan

that require protection. 2. Elan Is The Holder Of Privilege

When control of a corporation passes to new management, the authority to assert and waive the corporation's attorney-client privilege passes as well. See, e.g., Commodity Futures Trading Comm'n. v. Weintraub, 471 U.S. 343, 349, (1985); Tekni-Plex, Inc. v. Meyner and Landis, 674 N.E.2d 663, 668 (NY. 1986); Ramada Franchise Sys. v. Hotel of Gainesville Assocs , 988 F. Supp. 1460, 1463 (N.D. Ga. 1997); Soverain Software LLC v. Gap, Inc., 340 F. Supp. 2d 760, 763 (E.D. Tex. 2004). Whether the attorney-client relationship transfers to the new owners turns on the practical consequences rather than the formalities of the particular transaction. See Soverain Software, 340 F. Supp. 2d at 763 (citing Tekni-Plex, Inc. v. Meyer and Landis, 674 N.E.2d at 668; Ramada Franchise, 988 F. Supp. at 1464). In Soverain, the court held that "if the practical consequences of the transaction result in the transfer of control of the business and the continuation of the business under new management, the authority to assert or waive the attorney-client privilege will
ELAN'S OPPOSITION TO APPLE'S MOTION TO COM PEL JAMES EAKIN TO PRODUCE DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM Case No. 09-cv-01531 RS (PVT)

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follow as well." Id. at 763. Here, similarly to Soverain, KTT through the Asset Purchase Agreement acquired "all of Logitech's touchpad business," which is the commercial embodiment of certain intellectual property rights including the '352 patent. The practical consequences of the transactions by which Elan acquired the touchpad business and the '352 patent were to the transfer control of the business and the continuation of the business under new management. As such, the authority to assert or waive the attorney-client privilege followed and passed to Elan as well. B. Elan Has Not Waived Attorney-Client Privilege With Respect To Documents, If Any, In Mr. Eakin's Possession. Elan has not waived any privilege attached to the communications between Logitech and Mr. Eakin during the prosecution of the '352 patent. Upon notice of Apple's subpoena to Mr. Eakin, Elan promptly through its counsel offered to assist Mr. Eakin in responding to Apple's subpoena to preserve Elan's privilege and withhold and log any privileged responsive documents requested. Mr. Eakin declined that offer. Elan has no control over the actions or inaction of Mr. Eakin, a third party, regarding what, when and how objections to Apple's subpoena should be made. Elan has made every attempt to preserve its privilege. In no event has Elan waived its privilege or agreed to Mr. Eakin's production of any privileged material, if indeed he has responsive documents. IV. CONCLUSION For the reasons discussed above, the Court should deny Apple's request to hold that objections with respect to the attorney-client privilege, and any other applicable privilege, immunity or protection, to a subpoena have been waived with respect to any documents in Mr. Eakin's possession that are responsive to Apple's subpoena. DATED: August 10, 2010 Respectfully submitted, ALSTON & BIRD LLP By: /s/ Sean P. DeBruine Sean P. DeBruine Attorneys for Plaintiff ELAN MICROELECTRONICS CORPORATION
Case No. 09-cv-01531 RS (PVT)

LEGAL02/32035595v4

ELAN'S OPPOSITION TO APPLE'S MOTION TO COM PEL JAMES EAKIN TO PRODUCE DOCUMENTS PURSUANT TO SUBPOENA DUCES TECUM

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