Poster by: wolfpaclvoltare 9/17/2007(Pacer)

A party that has taken extraordinary measures to exclude attorney-client privileged evidence does not waive the privilege, as defendants suggest, by failing to seal that evidence once it has been decisively ruled inadmissible. "mplied waiver requires a careful weighing of facts and 'should not be applied cavalierly.'" United States v. Desir, 273 F.3d 39, 46 (1st Cir. 2001) quoting In re Grand Jury Proceedings, 219 F.3d 175, 186 (2d Cir. 2000). In particular, a "[c]ourt cannot justify finding a waiver of privileged information merely to provide the opposing party information helpful to its [case] or because [the] information is relevant." Remington Arms Co. v. Liberty Mutual Ins. Co., 142 F.R.D. 408, 415 (D. Del. 1992). Courts have not found a waiver where the party attacking the privilege has not been prejudiced. The great weight of authority holds that the attorney-client privilege is waived when a litigant places information protected by it in issue through some affirmative act for his own benefit, and to allow the privilege to protect against disclosure of such information would be manifestly unfair to the opposing party." Conkling v. Turner, 883 F.2d 431, 434 (5th Cir. 1989). Upon careful analysis, the district court in Northern California ruled Higgins's testimony inadmissible in 2005. The Federal Circuit affirmed that decision in 2006. Defendants have not shown anything Charles Moore has done since then--expressly or impliedly--that could fairly be interpreted as waiving the privilege that should have protected his communications with Higgins. Neither have they shown how the public's being able to read some of the statements that were ruled inadmissible in 2005 makes those statements admissible now in 2007. Finally, defendants have not shown that they would suffer a jot of prejudice if this Court required them to make their defense without resort to Higgins's improper statements and testimony.
I. DEFENDANTS HAVE NOT CITED ANY AUTHORITY THAT SUPPORTS
THEIR THEORY OF WAIVER
Having evidently searched the law of every jurisdiction, defendants have found no authority to support their argument that Charles Moore waived the privilege protecting his communications with Higgins, or acquiesced in Higgins's unilateral decision to disclose Moore's confidences or challenge his interests. Each of the three cases they cite presents a perfectly intuitive waiver scenario in which a defendant either shared his secrets with a third party who was not obliged to maintain their confidentiality (United States v. Ryans, 903 F.2d 731 (10th Cir. 1990)); divulged privileged information in one circumstance and tried to reclaim the privilege later in another circumstance (In re Lorazepam & Clorazepate Antitrust Litigation, 2001 WL 1795665 (D.D.C. July 17, 2001))1; or sat idly by while his attorney testified in open court as to 1 In re Lorazepam & Clorazepate Antitrust Litigation, 2001 WL 1795665 (D.D.C. July 17, 2001) an unpublished order of a magistrate judge in Washington, D.C., denying a motion to compel the testimony of an attorney, actually says nothing about this case. While it states "The attorneyclient privilege can be waived by any actions of the client which are inconsistent with an intention to keep the communication shielded by the privilege confidential," Id. at *2, it does not suggest what actions might waive the privilege. More illuminating--and quite unhelpful to
defendants' opposition--are the two cases the order cites to support the quoted sentence, In re Continued on the next page all manner of secrets and confidences (GFI, Inc. v. Franklin Corp., 265 F.3d 1268 (Fed. Cir. 2001)). None of those things happened here. Ryans is inapposite because Charles Moore volunteered his confidences to no one other than Higgins, who, he had every reason to believe, would maintain them in secret because the law of every jurisdiction required (and still requires) him to do so. Unfortunately for (and unbeknownst to) Moore, Higgins later purported to share Moore's confidences with third parties adverse to Moore's interests. There was nothing Moore could have done to prevent Higgins's hair-raising ethical breaches, but, upon learning of them, he not only immediately and successfully moved to prevent their propagation in court, he moved to disqualify the three law firms that had encouraged (and paid for) Higgins's misconduct. Moore's decisive action at that juncture brought the inventorship case to a screeching halt because, without Higgins's wholly improper testimony, Patriot had no "case". Defendants suggest that Moore has "not shown any interest in safeguarding the alleged confidentiality" of his communications with Higgins, Defendants' Opposition, p. 1, but they completely overlook the facts that Moore moved to bar Higgins's testimony, and he successfully litigated his claims of privilege and breach-of-fiduciaryduty all the way through judgment and appeal. In re Lorazepam is irrelevant because plaintiffs have not tried to use the privilege as a sword and shield. Rather, they maintain that none of Higgins's testimony regarding inventorship is proper or relevant to this case, and because they have never cited Higgins's statements for any Continued from the previous page Subpoena Duces Tecum, 738 F.2d 1367, 1370 (D.C. Cir. 1984) and In re Sealed Case, 676 F.2d 793 (D.C. Cir. 1982). In each of those cases, the client sought to assert the privilege selectively, waiving it "in circumstances where disclosure might be beneficial while maintaining it in other circumstances where nondisclosure would be beneficial." In re Subpoena Duces Tecum, 738 F.2d at 1371. purpose except to prove their own gross impropriety. GFI is unhelpful becausee Moore did not acquiesce in Higgins's testifying in prior litigation. Instead, on Moore's motion, Higgins's testimony was completely disallowed and the law firms intending to elicit that testimony were disqualified.
II. IT MAKES NO DIFFERENCE THAT HIGGINS ATTENDED HIS DEPOSITION
UNDER SUBPOENA
Defendants argue that while Higgins's duty of loyalty to Moore was dispositive of the prior case, in this case his duty to testify trumps the duty of loyalty because here, Higgins was subpoenaed to appear for deposition whereas in the prior case, he offered his testimony voluntarily. (“TPL’s fiduciary duty argument is a red herring – in this case, Mr. Higgins was compelled to testify pursuant to a subpoena.” Opp. at 5.) But this distinction is indefensible. The routine issuance of a subpoena does not decide the ethical issues that surround an attorney's testifying about matters that concern a client. In fact, those issues are commonly litigated after a subpoena has issued. Defendants completely ignore In re Au Clair, 961 F.2d 65, 67 (5th Cir. 1992), which plaintiffs briefed in their motion. In that case, the Fifth Circuit reversed a district
court order compelling the testimony of a defense attorney who was subpoenaed to appear before a grand jury. As the court explained, "the controlling law in this area is 'little more than a reinforcement of the Code of Professional Responsibility, Ethical Considerations, and Disciplinary Rules, promulgated by the American Bar Association and adopted by the [local jurisdictions]." Id., 961 F.2d at 69, quoting Wilson P. Abraham Constr. Corp. v. Armco Steel Corp., 559 F.2d 250, 253 (5th Cir. 1977). As Au Clair makes clear, those ethical rules are not
abrogated as defendants suggest by the issuance of a subpoena. Defendants are simply attempting to “piggyback” on Mr. Higgins’ prior breach of fiduciary duty in order to introduce this same improper evidence. (See Thirteenth Affirmative Defense: Inequitable Conduct in the proposed Answers of Matsushita Electrical Industrial Corp., Ltd., JVC Americas Corp. and Panasonic Corporation of North America filed September 13, 2007 (Dkt. No. 318-2.)
III. THE DISTRICT COURT'S AND THE FEDERAL CIRCUIT'S ANALYSIS OF
THE ISSUES PRESENTED IN THIS CASE REMAIN VALID
Defendants claim that Judge Fogel's and the Federal Circuit's careful analysis of the issues presented in this motion have been somehow vitiated by the fact that the public has had access to some of Higgins's improper statements in the year since those courts examined these issues. But as both the Fifth and Ninth Circuits have explained, "[t]he attorney-client privilege is evidentiary …" Doe v. A Corp., 709 F.2d 1043, 1046 (5th Cir. 1983); United States v. Rogers, 751 F.2d 1074, 1077 (9th Cir. 1985). It "prevent[s] the forced disclosure in a judicial proceeding of certain confidential communications between a client and a lawyer." Rogers, 751 F.2d at 1077 (emphasis added). Thus, the relevant question is not whether the client's information is known or has been improperly revealed so that claiming the privilege is now somehow futile. If that were the rule, then defendants would win just by doggedly repeating statements that should never have been uttered, and suggesting that the repetition has made plaintiffs' protestations futile. This is what defendants are trying to do here. Higgins's improper
statements are no more admissible as evidence in the Eastern District of Texas in 2007 than they were in the Northern District of California in 2005. By protesting Higgins's and former counsel's misconduct in 2004, and successfully litigating his ethics claims against them all the way to judgment and through appeal, Charles Moore has done all that he must to maintain the privilege. Neither the passage of time nor plaintiffs' failure to call the Discovery Hotline before defendants convened Higgins' deposition in 2007 has "laundered" Higgins improper statements. Defendants must make their inventorship case using evidence that is admissible.
IV. CONCLUSION
For all of the foregoing reasons, the Motion of TPL and Moore to strike Higgins's deposition testimony and related exhibits should be granted.
DATED: September 14, 2007
By: Roger L. Cook
TOWNSEND and TOWNSEND and CREW LLP
Roger L. Cook, CA State Bar No. 55208
Lead Counsel

CERTIFICATE OF SERVICE
I hereby certify that counsel of record who are deemed to have consented to electronic service are being served this 14th day of September 2007, with a copy of this document via the Court’s CM/ECF system per Local Rule CV-5(a)(3). Any other counsel of record will be served by electronic mail, facsimile transmission and/or first class mail on this same date.

Roger L. Cook

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