Fabick, Inc. v. FABCO Equipment, Inc. et al
ORDER granting in part, denying in part and reserving in part 211 Defendants' Motion to Compel. Signed by District Judge William M. Conley on 10/05/2017. (mfh)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
FABCO EQUIPMENT, INC.
and JFTCO, INC.,
Before the court is defendants FABCO Equipment, Inc., and JFTCO, Inc.’s motion
to “compel discovery or, alternatively, to preclude evidence and argument at trial and strike
plaintiff’s reliance on advice of counsel in its summary judgment briefing.” (Dkt. #211.)
The court held a telephonic hearing on this motion today, at which the parties appeared
During the hearing, the court divided the privileged documents at issue (see Defs.’
Mot. (dkt. #211) 5-6) into two categories: the first consisting of those from the July 24,
1995 letter from Jay Fabick to Joe Fabick to the November 8, 1996 notes from Jay Fabick
to Joseph Fabick, Sr.; and the second consisting of those documents from the July 8, 2002
Assignment sent from Richard Glesner to Jay Fabick to the December 9, 1999 Letter and
Agreement from Jay Fabick to Joe Goode. With respect to the second set of documents,
for the reasons provided during the hearing and set forth in further detail below, the court
will deny the motion to compel, but will strike any statements in plaintiff’s summary
judgment submissions that Jay Fabick relied on attorney advice in signing a declaration in
support of the trademark application and transferring the FABICK marks to another entity,
as well as preclude plaintiff from offering similar testimony at trial, including without
limitation that Jay Fabick “relied upon,” “acted on” or “acted because of” the advice or
recommendation of counsel. As for the first set of documents, the court will reserve a
ruling pending further briefing by the parties and in camera inspection by the court.
Defendants FABCO Equipment, Inc., and JFTCO, Inc., assert an “unclean hands”
defense in response to plaintiff Fabick, Inc.’s trademark infringement claims, which centers
around two events: (1) Jay Fabick’s transfer of the FABICK marks to J.G. Fabick, LLC,
before the transfer of Fabick, Inc., stock to Jay and then the subsequent transfer of the
marks back to Fabick, Inc., after resolution of a lawsuit against FABCO; and (2) Jay
Fabick’s declaration to the USPTO as part of the trademark application that he had no
knowledge of use of the FABICK marks use in commerce in a manner that would be likely
to cause confusion.
Defendants contend that in response to defendants’ motion for summary judgment
and in Jay Fabick’s deposition, plaintiff put the advice of its counsel in issue and, therefore,
waived the attorney-client privilege. Specifically, defendants contend that plaintiff waived
the privilege with respect to the following three subject areas:
1. Documents and communications relating to the transfer of the FABICK
registrations between plaintiff and J.G. Fabick, LLC, which defendants
characterize as a shell corporation.
2. Preparation and prosecution of the trademark and service applications for the
3. Documents and communications on which plaintiff relies to argue that FABCO
had knowledge of the FABICK trademark registration.
In response to defendants’ motion, plaintiff principally denies placing advice of counsel at
issue in this litigation and, therefore, denies waiving the attorney-client privilege.
With respect to the first two subject areas, plaintiff argues that advice of counsel is
not even mentioned in plaintiff Fabick, Inc.’s opposition to the motion for summary
judgment. Instead, Jay Fabick testified at his deposition that he followed the advice of
counsel in: (1) signing the declaration submitted with the trademark applications; and (2)
transferring the marks to J.G. Fabrick, LLC. (Pl.’s Opp’n (dkt. #213) 8-9 (excerpting
relevant portions of deposition text).) As to the latter, plaintiff further argues that simply
mentioning that he consulted with an attorney does not place the defense in issue. (See
Pl.’s Opp’n (dkt. #213) 11-15 (discussing cases distinguishing between placing advice of
counsel defense at issue and simply mentioning that a party consulted with an attorney.)
After briefly reviewing the parties’ summary judgment submissions, the court agrees
that plaintiff has not asserted an advice of counsel defense and, therefore, finds no waiver
to date. See State v. Hydrite Chem. Co., 220 Wis. 2d 51, 68-69, 582 N.W.2d 411, 418 (Ct.
App. 1998) (adopting “restrictive” view of the “at issue” doctrine, where privilege is only
waived “when the privilege holder attempts to prove a claim or defense by disclosing or
describing an attorney-client communication,” but not when “the privilege holder places a
claim or defense at issue and the document in question has a direct bearing on that claim
or defense, regardless of whether the privilege holder intends to use the document to prove
the claim or defense”).
While Jay Fabick testified at his deposition that he consulted with attorneys
regarding the declaration and transfer of the marks and relied on their advice and plaintiff
propose certain findings of facts in its summary judgment briefing consistent with this
testimony, Fabick neither disclosed the substance of the communications nor has plaintiff
otherwise waived any privilege that might attach to the withheld documents by attempting
to prove a claim or defense by describing those communications. See id. at 67, 582 N.W.2d
at 418 (quoting Rhone-Poulenc Rorer Inc. v. Home Indem. Co., 32 F.3d 851, 863 (3d Cir.
1994) (“Advice is not in issue merely because it is relevant, and does not necessarily
become in issue merely because the attorney’s advice might affect the client’s state of mind
in a relevant manner. The advice of counsel is placed in issue where the client asserts a
claim or defense, and attempts to prove that claim or defense by disclosing or describing
an attorney client communication.”)).
Having now affirmatively asserted the privilege as to the substance of his oral and
written communications with counsel and those documents, however, Jay Fabick (and
other plaintiff’s witnesses privy to their content, if any) are precluded from relying in
anyway on the advice of counsel in explaining plaintiff’s actions with respect to signing the
1994 declaration or transferring its trademarks to a separate company in 1997.
Specifically, Jay Fabick will be precluded from indicating that, with respect to both actions,
he “reached that determination after consulting with legal counsel,” that he “relied on the
advice of counsel,” or that “a course of action was recommended by counsel,” or any similar
The court also can find no waiver of any privilege requiring disclosure of the
attorney-client communications regarding the first set of documents described above -those involving Foley & Lardner’s apparent joint representation of FABCO and Fabick,
Inc., from roughly 1993 through 1996, for purposes of securing the FABICK trademarks.
However, by defendant FABCO (or as its counsel referred to that defendant, the company
formerly known as FABCO) the communications may be discoverable for another reason:
defendant FABCO shares in that privilege jointly and is entitled to review those documents.
(Defs.’ Br. (dkt. #212) 14; Pl.’s Opp’n (dkt. #213) 22-24.)
Of course, as discussed during the hearing, there is a third party involved in this
lawsuit, defendant JFTCO, Inc., which complicates any order by the court to disclose these
documents, as well as FABCO’s right to do so upon receipt without Fabick, Inc.’s consent.
These issues, however, were not fully anticipated or briefed by the parties. As such, the
court directed defendants to file a brief by October 9, 2017, describing any basis for
disclosure to JFTCO, Inc., and plaintiff has until October 11, 2017, to brief its continued
opposition to disclosure to JFTCO, Inc., as well as any practical or legal impediments to
disclosure of the documents solely to FABCO and its counsel.
At the time of filing,
plaintiff should also file the first category of privileged documents ex parte for in camera
inspection by the court.
IT IS ORDERED that:
1) Defendants FABCO, Equipment, Inc., and JFTCO, Inc.’s motion to compel
discovery or, alternatively, to preclude evidence and argument at trial and strike
plaintiff’s reliance on advice of counsel in its summary judgment briefing (dkt.
#211) is GRANTED IN PART, DENIED IN PART and RESERVED IN PART
a. The motion to preclude Fabick, Inc., from relying on an advice of counsel
defense at summary judgment or at trial is GRANTED. The parameters
of Jay Fabick’s or other Fabick, Inc., witnesses’ testimony at trial is
described in the opinion above.
b. The motion to compel is, therefore, DENIED with respect to the “second
category” of documents described on pg. 1 of the opinion above.
c. The motion to compel is RESERVED with respect to the “first category”
of documents described on pg. 1 of the opinion above.
2) On or before October 9, 2017, defendants may file a further brief describing any
basis for disclosure of the documents to defendant JFTCO, Inc.
3) On or before October 11, 2017, plaintiff may file a response brief. At the same
time, plaintiff shall submit ex parte a copy of those documents in the first category
for in camera inspection.
Entered this 5th day of October, 2017.
BY THE COURT:
WILLIAM M. CONLEY
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