Falana v. Kent Displays, Inc. et al
Filing
135
Memorandum Opinion and Order regarding 128 Olusegun Falana's request for discovery related to attorney fees. The original binder and supplemental materials submitted to the Court for in camera review have been scanned. The Clerk is directed to electronically file these materials UNDER SEAL. Plaintiff and the Kent State University shall cooperate to complete this discovery by January 31, 2013. If plaintiff desires to file a supplemental brief after completing discovery, he should do so by February 15, 2013. Any response by defendants must be filed by February 28, 2013. (SEE Opinion for specifics). Signed by Judge David D. Dowd, Jr. on 12/6/2012. (M,De)
DOWD, J.
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
Olusegun Falana,
Plaintiff,
v.
Kent State University, et al.,
Defendants.
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CASE NO. 5:08 CV 720
MEMORANDUM OPINION AND
ORDER
The Court previously ruled that plaintiff Olusegun Falana was an inventor with respect to
the patent at issue in this case, and that ruling was upheld on appeal. A brief summary of the
procedural history in this case may be helpful in understanding the present dispute before the
Court regarding plaintiff’s request for discovery related to attorney fees. ECF 128.
The complaint in this case sought the addition of plaintiff as a named inventor on
U.S. Patent No. 6,830,789 (the ‘789 Patent). The complaint was filed against defendants Kent
Displays, Inc. (KDI), Joseph Doane (Doane), Asad Khan (Khan), Kent State University (KSU)
and Alexander Seed (Seed). Doane, Khan and Seed are the named inventors on the ‘789 Patent.
After the case was filed, Doane and Khan filed affidavits with the Court stating that they
had no objection to adding plaintiff as a named inventor on the ‘789 Patent. As a consequence,
the KDI, Doane and Khan were dismissed from the lawsuit approximately nine months after the
case was filed.
(5:08 CV 720)
After a lengthy bench trial, the Court issued its Findings of Facts and Conclusions of Law
(ECF 92). The Court concluded that plaintiff is an inventor of the ‘789 Patent, and ordered the
Director of the United States Patent and Trademark Office to add the plaintiff as a named
inventor and issue a certificate of correction for the ‘789 Patent. ECF 92, 93 and 94. In that
same opinion, the Court determined that this case was exceptional within the meaning of
35 U.S.C. § 285 and that an attorney fee award was justified and warranted. ECF 92. Plaintiff
submitted an application for attorney fees, but the Court deferred action on plaintiff’s fee
application pending appeal of the Court’s judgment on inventorship.
Defendants appealed the Court’s judgment that the plaintiff was a joint inventor of the
‘789 Patent to the Federal Circuit, as well as the Court’s exceptional case determination.1 The
Court’s judgment regarding inventorship was affirmed by the Federal Circuit. The Court’s
exceptional case finding and determination that an attorney fee award was justified was not final,
and therefore not properly before the Federal Circuit on appeal. The Federal Circuit nevertheless
commented in dicta that they found defendants’ arguments opposing the Court’s exceptional
case determination to be “persuasive.”
The issue of plaintiff’s attorney fee application has followed an unusual path. The
Court’s original conclusion that this case is exceptional and an attorney fee award is justified, as
well as the Federal Circuit’s dicta, were issued without the benefit of complete briefing by the
parties on that subject. At a status conference conducted on April 19, 2012, both sides expressed
the desire to fully brief the issues in support of their respective positions. The Court concluded
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Counsel are requested to provide the Court with a copy of the briefs filed on appeal.
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that the parties should be permitted to brief the issue, and advised the parties that the question of
whether this case is exceptional would be reconsidered.
The parties fully briefed the issues, and after the benefit of the parties’ briefs and
reconsideration, the Court advised the parties in an Order scheduling a status conference that
Court was of the view that this case is exceptional within the meaning of § 285 and that an award
of attorney fees is appropriate. ECF 126. However, the Court has not yet issued its written
reconsideration opinion.
The Court’s Order then went on to state: “Before determining the amount of fees to be
awarded, however, the Court will conduct a status conference. At the status conference, counsel
should be prepared to discuss whether either side wishes to conduct discovery on the issue of
fees, including discovery of defendants’ counsel’s fees.” ECF 126.
Plaintiff requested discovery, defendants did not. Defendants oppose plaintiff’s
discovery request. This discovery dispute is the matter presently under consideration by the
Court. For the reasons discussed below, plaintiff’s request for discovery is GRANTED IN
PART AND DENIED IN PART.
A.
Plaintiff’s Discovery Request
Plaintiff requests the following discovery in connection with his fee application
(ECF 128):
1.
The joint defense agreement referred to in the deposition of Paul Serbinowski.2
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Mr. Serbinowski’s deposition was taken on October 9, 2008. ECF 128-1. Mr.
Serbinowski is a lawyer who, according to his deposition, has represented both defendant Kent
(continued...)
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2.
All correspondence exchanged between/among the original defendants in
accordance with that joint defense agreement.
3.
The opportunity to depose the representatives who executed the joint defense
agreement, and the authors and recipients of that correspondence.
4.
The identity of all those who charged the defendants for their services, which
defendants were charged, by whom, how much, and for what services.
Defendants oppose plaintiff’s request for discovery on two grounds - relevance and
attorney work-product. ECF 130. First, defendants contend that plaintiff’s discovery requests
are not relevant to the fee application, and that the only relevant information to the fee
calculation is the number of hours expended and a reasonable hourly rate. Therefore,
defendants argue that plaintiff’s discovery requests do not satisfy the relevance requirement of
Fed.R.Civ.P. 26(b)(1). Defendants also oppose plaintiff’s discovery request on the basis of Rule
26(b)(3), arguing that the requested discovery is protected by the attorney work-product doctrine
and that plaintiff cannot make the required showing of substantial need and undue hardship
pursuant to Rule 26(b)(3)(A)(i) and (ii) that is necessary to overcome the protections of Rule
26(b)(3). See ECF 130.
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Displays, Inc. and defendant Kent State University in various matters over the years. Mr.
Serbinowski testified at his deposition that there was a written joint defense agreement in this
case. Mr. Serbinowski’s firm, Pearne & Gordon, represented KDI in this case, and also
represented KSU through the joint defense agreement. Serbinowski Depo., ECF 128-1, p. 9.
Mr. Serbinowski’s opinion regarding inventorship of the ‘789 Patent was provided to KDI and
KSU’s in-house counsel, Constance Hawke, after the joint defense agreement was executed, “at
which time she would have been a client - the University would have been a client of ours.”
Serbinowski Depo., ECF 128-1, p. 9-11. The joint defense agreement between KDI and KSU
preceded the filing of this lawsuit. Serbinowski Depo., ECF 128-1, p. 10-12.
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In reply, plaintiff asserts that defendants’ objections to the exceptional nature of this case
have made the discovery sought by plaintiff relevant. Specifically, defendants argue that the
Court “unfairly lumped the testimony of two non-party witnesses together with defendants’
testimony” as a basis for concluding this case is exceptional. Plaintiff contends that this
argument has made the requested discovery relevant because the joint defense agreement, and
communications among defendants and counsel, could demonstrate coordination of the original
defendants up to and through the trial, thereby calling into question the distance the KSU and
Seed now seek to insert between themselves and the testimony of Doane and Khan, who were
dismissed as defendants prior to trial.
With respect to amount of attorney fees, defendants have argued that the total amount of
fees requested by plaintiff is not reasonable. Plaintiff contends that this argument makes
relevant the requested discovery as to amount of defendants’ attorney fees.
With respect to defendants’ objection to discovery on the grounds that the joint defense
agreement and other documents are protected by the work-product doctrine, plaintiff points out
that defendants do not assert that the joint defense agreement discloses the thoughts and opinions
of counsel, which the work-product doctrine was developed to protect. Rather, plaintiff states
that the joint defense agreement would be evidence of a joint defense or common interest
privilege. The joint defense or common interest privilege is not a privilege itself but an
exception to waiver of the attorney-client privilege, and plaintiff contends that the joint defense
agreement must be examined to determine if an underlying attorney-client relationship exists
among the original defendants and their respective counsel. See ECF 131. Defendants filed a
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sur-reply, now asserting that plaintiff’s discovery request is “irrelevant and an impermissible
invasion of the attorney client and work product privileges . . . .” ECF 134, p. 2.
B.
Court’s in camera review
The Court directed the defendants to produce the information requested by plaintiff to the
Court for in camera review. Defendants timely produced the documents in a white three-ring
binder. The binder contains a two-page cover letter dated November 15, 2012, a six-page index
of the documents contained in the binder, and fifty-seven (57) numbered tabs dividing the fiftyseven documents listed on the document index. Some of the documents are e-mail strings.
Under separate cover by letter dated November 21, 2012, defendants supplemented the
documents submitted for in camera review with two additional documents numbered fifty-eight
(58) and fifty-nine (59). In addition, defendants provided an updated document index which
includes the two additional documents provided.
For each of the documents, the index reflects the date of the document, title and subject
matter. In addition, the index contains a column that identifies the “privilege” that the
defendants assert for each document. For each document provided for in camera review,
defendants assert the “common interest privilege” and “work product doctrine.”
The original binder and supplemental materials submitted to the Court for in camera
review have been scanned. The Clerk is directed to electronically file these materials UNDER
SEAL.
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C.
Analysis
Defendants object to plaintiff’s discovery request on two grounds: 1) attorney client
privilege and work-product doctrine; and 2) relevance.
1. Attorney-client privilege (common interest privilege) and work-product doctrine
Defendants’ have asserted the attorney-client privilege/common interest privilege and
work-product doctrine as a basis for preventing discovery of the joint defense agreement3
between KDI and KSU as well as correspondence exchanged between/among the KDI, Doane,
Khan, KSU, Seed and their counsel in accordance with the joint defense agreement. The Court’s
in camera review of the joint defense agreement confirms Mr. Serbinowski’s deposition
testimony that the parties to the joint defense agreement are KSU and KDI. As the name of the
agreement suggests and Mr. Serbinowski’s deposition testimony reflects, the Court’s in camera
review confirms that the joint defense agreement was executed to facilitate KSU’s and KDI’s
common defense interests with respect to plaintiff’s inventorship claims and to allow sharing of
“Defense Materials” and communications between and among KSU, KDI and their respective
counsel without waiving the attorney-client privilege. By its terms, the joint defense agreement
is “governed by federal common law as to the existence and scope of the joint interest and other
privileges protected by the Agreement and, as to all other matters, by the law of Ohio . . ..”
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The actual title of the document submitted for in camera review is Joint Defense and
Confidentiality Agreement.
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Entirely absent from the joint defense agreement is any provision related to the payment
of KDI’s and KSU’s attorney fees. Therefore, documents and information regarding attorney
fees is not protected by the any privilege or common interest pursuant to the joint defense
agreement.
The common interest privilege asserted by defendants to oppose plaintiff’s discovery
requests is not an independent privilege, but an exception to the general rule that the
attorney-client privilege is waived when privileged information is disclosed to third parties,
and assumes the existence of an underlying privilege. Broessel v. Triad Guaranty Insurance
Corp., 238 F.R.D 215, 219 (W.D. Kentucky 2006). One of the situations where the common
interest exception applies is when the parties share a common defense interest and enter into a
written joint defense agreement to assure that shared information remains privileged. Id.
As a result of its in camera review, the Court concludes that, for purposes of plaintiff’s
discovery request, the correspondence sought by plaintiff is protected from disclosure on the
basis of attorney-client privilege/common interest privilege and work-product doctrine as
asserted by defendants, except as hereinafter provided. The joint defense agreement itself is, by
its terms, part of the “Defense Materials.” On that basis only, the Court concludes that for the
purpose of plaintiff’s discovery request the document is not subject to disclosure. However, this
conclusion has no effect on the public record status, if any, of the joint defense agreement.
Accordingly, plaintiff’s request for discovery of the joint defense agreement and related
correspondence is DENIED, except as hereinafter provided.
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2.
Relevance
The amount of attorney fees charged to and/or paid by the KSU is not protected by
privilege, and defendants’ objection to this discovery is based on relevance. Relevance is
liberally construed for discovery purposes pursuant to Rule 26(b)(1). Guinn v. Mount Carmel
Health Systems, 2010 WL 2927254 (S.D. Ohio). KSU has opposed plaintiff’s fee application on
the grounds of reasonableness.
Originally, plaintiff was required to prosecute this case against both KDI and KSU. KDI
and KSU are represented by separate counsel and different law firms, except to the extent they
were jointly represented under the terms of the joint defense agreement. Discovery regarding
defendants’ attorney fees may provide information relevant to the Court in determining the
reasonableness of plaintiff’s attorney fee application, for example with respect to hours
expended and hourly rate.
Therefore, the Court concludes that plaintiff’s request for discovery with respect to
attorney fees and services falls within the broad scope of relevance outlined in Rule 26.
Accordingly, plaintiff’s request for discovery with respect to defendants’ fees and/or costs,
including fees and costs charged to and/or paid by KSU and/or Seed, and the specifics related
thereto, is GRANTED.
During its in camera review of correspondence provided by defendants, the Court
observed that some correspondence contains privileged and work-product information protected
under the joint defense agreement, as well as non-privileged information related to the payment
of attorney fees. If document(s) containing both privileged and non-privileged information
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regarding attorney fees are requested by plaintiff in discovery, defendants shall provide the entire
document(s) to plaintiff, but may redact the privileged information.
D.
Conclusion
Plaintiff and the KSU shall cooperate to complete this discovery by January 31, 2013.
If plaintiff desires to file a supplemental brief after completing discovery, he should do so by
February 15, 2013. Any response by defendants must be filed by February 28, 2013.
IT IS SO ORDERED.
December 6, 2012
Date
s/ David D. Dowd, Jr.
David D. Dowd, Jr.
U.S. District Judge
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