United States District Court, N.D. Illinois, Eastern Division
September 30, 2004.
BLACKHAWK MOLDING CO., INC., Plaintiff,
PORTOLA PACKAGING, INC., a Delaware corporation, Defendant.
The opinion of the court was delivered by: MARTIN ASHMAN, Magistrate Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Blackhawk Molding Co., Inc. ("Blackhawk") moves this
Court to compel Defendant Portola Packaging, Inc. ("Portola") to
produce all documents relating to the subject matter of an
October 28, 1999 Opinion Letter ("Opinion Letter") that Portola
disclosed to Blackhawk during the discovery phase of this patent
infringement suit. This matter comes before this Court pursuant
to 28 U.S.C. § 636(b)(1)(A) and Local Rule 72.1.
Blackhawk brings suit against Portola alleging infringement on
its U.S. Patent No. 5,904,259 ("the '259 patent"). Blackhawk
seeks to show that Portola willfully infringed Blackhawk's
patent, i.e., Portola lacked a reasonable belief that its actions
would avoid infringement. Portola raises an advice-of-counsel
defense and claims that it acted in good faith reliance on
counsel and never intentionally infringed the '259 patent. As
part of its advice-of-counsel defense, Portola disclosed to Blackhawk the
Opinion Letter prepared by its counsel, which opines that
Blackhawk's patent is invalid and fraudulently procured.
Principles of fairness support waiving attorney-client
privilege and work product privilege where a party relies on an
advice-of-counsel defense. See Thermos Co. v. Starbucks Corp.,
No. 96 C 3833, 1998 WL 781120, at *1 (N.D. Ill. Nov. 3, 1998).
Principles of fairness also prevent a party from disclosing those
opinions that support its position while simultaneously
concealing those opinions that do not. Id. Thus, a party who
relies on an advice-of-counsel defense waives attorney-client
privilege with respect to the subject matter of the legal advice
relied upon. See In re Pioneer Hi-Bred Int'l, Inc.,
238 F.3d 1370, 1375 (Fed. Cir. 2001); Motorola, Inc. v. Vosi
Technologies, Inc., No. 01 C 4182, 2002 WL 1917256, at *1 (N.D.
Ill. Aug. 19, 2002). Portola relies on an advice-of-counsel
defense and disclosed the Opinion Letter in support of that
defense, so Portola has waived its attorney-client privilege. All
that is left to determine is the scope of Portola's waiver, i.e.,
the scope of the subject matter of the legal advice relied upon.
Blackhawk argues that the subject matter of Portola's Opinion
Letter is the asserted patent, and not a particular legal issue
or phase of the case. According to Blackhawk, the subject matter
of the Opinion letter specifically includes: (1) the extent to
which claims of the '259 patent are "used by Portola" (i.e.,
infringement); (2) the extent to which the claims of the '259
patent are "invalid because they are obvious" (i.e., validity);
and (3) the extent to which statements made during prosecution of
the '259 patent were "knowingly false" (i.e., enforceability).
(Pl.'s Reply Def.'s Opp'n Pl.'s Mot. Compel at 7.) Blackhawk
moves this Court to compel Portola to produce all documents that relate to these issues, including but not
limited to those documents listed on Portola's privilege log.
Portola rejects Blackhawk's argument and claims that the
subject matter of the Opinion Letter includes invalidity and to
some extent enforceability, but nothing more. Portola also argues
that, because Portola's state of mind is the real issue,
documents and/or claims construction that its counsel relied on
but did not communicate to Portola are irrelevant to this case.
Thus, Portola concludes that it has waived its attorney-client
privilege only with regard to documents that: (1) concern
opinions regarding invalidity and/or fraudulent procurement of
the '259 patent, and which (2) contain information that was
actually communicated to Portola, and were (3) generated before
the commencement of this lawsuit. (Def.'s Opp'n Pl.'s Mot. Compel
The Court finds the subject matter of Portola's Opinion Letter
to be broader than invalidity and enforceability. The Opinion
Letter does discuss invalidity and enforceability in great
detail. That discussion includes; the obviousness of the patent's
claims, (Op. Letter at 2, 7), prior uses of the patent's claims
by Portola and Liqui-Box Corporation, (id. at 2), prior art, such
as U.S. Patent Nos. 5,370,270 and 5,392,939 (id. at 7, 12), and
alleged misrepresentations by Blackhawk during the application
process. (Id. at 15.) In addition to opining on the invalidity
and unenforceability of the '259 patent, the Opinion Letter also
analyzes the claims of the '259 patent and compares them to
Portola's product. In several instances, including Claims 4, 6
and 12, the Opinion Letter opines that Portola's product does not
use the same techniques or methodologies described in the claim.
(Id. at 1.) Blackhawk argues that when the Opinion Letter
describes the methods utilized by a claim in detail and then
opines that Portola's product does not "use" that claim it is giving an opinion on infringement. The
Court agrees. Additionally, the Court finds that comparing the
'259 patent to Portola's product and analyzing prior art, namely
the claims of U.S. Patent Nos. 5,370,270 and 5,392,939, requires
claims construction of the '259 patent.
It would be unfair to limit the scope of Portola's waiver of
attorney-client privilege to validity and enforceability alone.
As an initial matter, the Court finds the subject matter of the
Opinion Letter extends to infringement. Furthermore, though it
purports to address validity and enforceability alone, the
Opinion Letter clearly relies on claims construction of the '259
patent. In Motorola, a plaintiff seeking to rely on legal
opinions concerning the "validity" of a patent asked the court to
limit the scope of its waiver of attorney-client privilege by
defining the subject matter of the opinions as "validity" alone.
Motorola, Inc., 2002 WL 1917256, at *1. The court refused to so
limit the subject matter of the opinions and held that, "opinions
that involve issues other than validity but that include a
construction of the patent concern, to that extent, the same
subject matter as opinions regarding validity." Id. at *2.
Because it would be unfair to permit a selective disclosure of
opinions bearing on the validity issue, the Motorola court
ruled that, if the plaintiff "chooses to rely on its counsel's
opinions regarding validity, it must disclose all pre-suit
communications of counsel on subjects other than validity insofar
as they include a construction of the same patent or patents that
are the subject of any validity opinion." Id.
The content of the Opinion Letter and the holding in
Motorola, persuade this Court to grant Blackhawk's motion (in
part) and require Portola to produce all pre-suit communications
of counsel insofar as they relate to the '259 patent. By relying
on the Opinion Letter, Portola waived its attorney-client
privilege with regard to all written and oral communications
relating to infringement, validity and enforceability of the '259 patent,
including any relevant documents listed on the privilege log.
This waiver extends to all relevant documents and communications
whether or not they were conveyed to Portola and whether or not
they support the positions outlined in the Opinion Letter. See
id.; Beneficial Franchise Co. v. Bank One, N.A.,
205 F.R.D. 212, 218 (N.D. Ill. 2001) ("The practical reality is that if
negative information was important enough to reduce to a
memorandum, there is a reasonable possibility that the
information was conveyed in some form or fashion to the
client."). Accordingly, Portola must produce any and all
documents and communications, including those listed on the
privilege log, that relate to infringement, validity and
enforceability of the '259 patent, up until the filing of this
Portola does not need to produce documents prepared or
communications transmitted after the filing of this lawsuit. The
willfulness of a party's conduct logically depends on the advice
it received before the suit was filed. Motorola, Inc., 2002 WL
1917256 at *2.
Blackhawk's Motion to Compel is granted in part.
© 1992-2004 VersusLaw Inc.