Law Firms' Discovery Dispute Could Prove Costly

Rejecting King & Spalding's claims that Duane Morris lawyers lied in discovery dispute, judge passes fees, potential costs to K&S, its client

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Refereeing a discovery dispute between lawyers from King & Spalding and Duane Morris, a federal judge said the only way he'd ever sort out the problem was by combing through the record himself.

"And then," he added, according to a hearing transcript, "I am going to be really mad at somebody."

That somebody turned out to be King & Spalding, which had said Duane Morris could not be trusted and had made "plainly false" statements to the court.

Judge Thomas W. Thrash Jr. of the U.S. District Court for the Northern District of Georgia said King & Spalding's claims "are just not true" -- and said the firm's "invective" could cost the firm or its client nearly $387,000.

Thrash ordered King & Spalding or its client, Cordele, Ga.-based CBT Flint Partners LLC, to pay 75 percent of the attorney fees racked up by the Duane Morris lawyers -- about $87,000 -- for billings generated by the bitter, protracted discovery dispute.

The Aug. 7 order came two months after Thrash put a hefty tab on CBT's request for a half-million potentially privileged documents from its opponent, San Bruno, Calif.-based Cisco IronPort. Thrash said King & Spalding's client was entitled to the documents -- but only if it paid $300,000 to conduct a privilege review.

The discovery dispute stems from a suit filed by CBT accusing Cisco IronPort of infringing on two of its patents related to e-mail certification services and billing. Cisco IronPort, part of technology giant Cisco, denies those allegations.

CBT's counsel, King & Spalding partners A. Shane Nichols and Anthony B. Askew, declined to comment on the judge's statements because the case is pending. Both said their client had not yet decided whether it would pay $300,000 to get the privilege review.

Asked whether the firm or its client would be writing the $86,786.95 check to pay Duane Morris's fees, Askew said, "I don't know that -- and again, I don't think it's appropriate to respond to matters that are pending before the court."

Ironically, Cisco IronPort's lawyer, L. Norwood "Woody" Jameson of Duane Morris, used to practice law at King & Spalding with some of the attorneys who leveled the accusations of stonewalling and dishonesty against him and his firm. Jameson referred a request for comment to his client.

Terry Alberstein, a spokesman for Cisco, said in an e-mail message that, "Cisco is gratified by the court's sanction orders. ... We hope that King & Spalding will use the Court's order as an opportunity to reflect upon their professionalism."

FOOT-DRAGGING ACCUSATIONS

Discovery problems came to a head in April, apparently, when CBT and its lawyers, led by Nichols and Askew, filed a 29-page emergency motion to compel discovery accompanied by 343 pages of exhibits. The motion alleged that Cisco IronPort tried to delay discovery until Thrash could rule on a pending summary judgment motion. It also claimed that after being served with discovery requests late last year, Cisco IronPort spent five months dragging its feet and produced only 4,400 pages -- little more than a single bankers' box of documents.

According to briefs filed by King & Spalding, Duane Morris had met -- and missed -- some interim production deadlines. But by mid-May, before the close of the discovery period, the record indicates that Cisco IronPort and its counsel at Duane Morris had produced more than 1.4 million documents, from electronic searches of 102 search terms selected by CBT, as well as six versions of source code and more than 1,400 pages of other information and prior art.

After noting that the record in the discovery dispute contained 212 pages of briefing and 147 exhibits, Thrash dispatched the debate with his orders in June and earlier this month that together totaled 11 1/2 pages. They show a series of unusual moves by a federal judge who is clearly unhappy with how King & Spalding attempted to muscle its way through discovery.

Thrash minces no words in either order. He wrote that complaints by King & Spalding's client about Cisco IronPort's document production are "substantially much ado about nothing" and that he is "baffled" by CBT's "failure to engage in a meaningful discussion with Cisco IronPort regarding these discovery issues." He also rapped CBT and its counsel for wasting the court's time by making unjustified accusations against Duane Morris which forced him to review the entire record -- and conclude that the accusations "are just not true."

SEEKING ALL DOCUMENTS

Thrash wrote that CBT "made no effort" to identify the specific categories of documents that were relevant, noting that CBT's discovery requests were so broad they "essentially called for every document at Cisco IronPort that deals with the accused products in this case, which means, in effect, every document in the company."

Thrash added that CBT did not tell Cisco IronPort it intended to seek sanctions and that if CBT had engaged in meaningful discussion with its opposing counsel, the entire discovery dispute could have been avoided.

He then castigated CBT and King & Spalding for the accusations they made against their opposing counsel at Duane Morris. CBT "filled the record with invective in both challenging the motives of Cisco IronPort with respect to allegedly delaying discovery and challenging the honesty of Cisco IronPort's counsel with respect to their representations to the Court," he wrote.

Thrash goes on to cite language from some of King & Spalding's filings for CBT, which allege that Cisco IronPort's "behavior is inexcusable and should be sanctioned," and accuse the company of "mischaracterizing and misrepresenting the course of discovery and the communications between the parties." In another brief, CBT's counsel accused the Duane Morris lawyers of being willing to say "anything to avoid being held liable for the failure to meaningfully engage in discovery in this case."

The judge quoted from the transcript of a hearing in which one of the King & Spalding lawyers -- who is not named -- described Cisco IronPort's document production as a "document dump if I have ever heard of one." But, Thrash noted, CBT defined the search terms that produced the massive amount of documents.

"In light of this record, the Court finds that the above-quoted statement from Plaintiff's counsel is extremely disturbing," Thrash concluded.

He summed up his view of King & Spalding and CBT's attempt to compel discovery by writing that the plaintiff lacked "an adequate basis for provoking this enormously costly (to the parties) and enormously burdensome (to the Court) discovery dispute and motions practice."