United States District Court, D. Delaware
before the Court are Plaintiffs objections to Special Master
Order No. 13 (No. 16-453, D.I. 361; No. 16-454, D.I. 327, No.
16-455, D.I. 322). The parties have submitted briefing. (D.I.
379; D.I. 394). For the reasons that follow, I overrule
Plaintiffs objections (D.I. 379) and adopt the Special
Master's Order No. 13 (D.I. 361).
explained by the Special Master, this Order concerns
"emails" and "documents that Plaintiff
provided to Hamilton Capital and/or [Hamilton Capital's]
counsel, Reed Smith, during their negotiation of a litigation
financing agreement in 2014 and 2015." (D.I. 361 at 4).
Plaintiff asserts that these communications were provided to
Hamilton Capital in "connection with diligence for the
funding of this litigation. (D.I. 379 at 2). The
communications were exchanged "before any agreement was
reached between Plaintiff and Hamilton Capital, and before
any litigation was filed." (D.I. 361 at 7).
seek to exclude these communications on three grounds: the
communications are "non-discoverable attorney work
product;" Plaintiff and Hamilton Capital "share a
common legal interest in the successful enforcement of the
asserted patents" such that the communications are
subject to attorney-client privilege; and the communications
are not relevant. (D.I. 379 at 1-2). The Court reviews the
Special Master's order de novo as to factual
findings and legal conclusions, and for abuse of discretion
as to procedural matters. Fed.R.Civ.P. 53(f).
Work Product Privilege
work product doctrine, codified in Federal Rule of Civil
Procedure 26(b), provides that "a party may not discover
documents and tangible things that are prepared in
anticipation of litigation or for trial by or for another
party or its representative." Fed.R.Civ.P. 26(b)(3). The
party asserting work product immunity bears the burden of
showing that the sought documents were prepared "in the
course of preparation for possible litigation."
Holmes v. Pension Plan of Bethlehem Steel Corp., 213
F.3d 124, 138 (3d Cir. 2000). If the party claiming work
product immunity meets this burden, then the party seeking
production may obtain discovery "only upon a showing
that the party . . . has a substantial need of the materials
in preparation of the party's case and that the party is
unable without undue hardship to obtain the substantial
equivalent of the materials by other means."
Id.; Fed.R.Civ.P. 26(b)(3). The test employed by
courts is whether "in light of the nature of the
document and the factual situation of the case, the document
can fairly be said to have been prepared or obtained because
of the prospect of litigation." U.S. v. Rockwell
Int'l, 897 F.2d 1255, 1265-66 (3d Cir. 1990). A
document will be granted protection from disclosure if the
court finds that the "primary" purpose behind its
creation was to aid in possible future litigation.
Id. at 1266.
Plaintiff has characterized the communications as being
created "for the purpose of obtaining funding to assert
[the] patents." (D.I. 379 at 3). The communications were
exchanged before Hamilton Capital had agreed to fund
Plaintiffs litigation, and before Plaintiff filed any
litigation. (D.I. 361 at 7; D.I. 380-1, Exh. C).
documents were thus prepared with a "primary"
purpose of obtaining a loan, as opposed to aiding in possible
future litigation. For that reason alone, the communications
are not work product.
if a document sought "is prepared for a nonparty to the
litigation, work product protection does not apply, even if
the nonparty is a party to closely related litigation."
6 James Wm. Moore et al., Moore's Federal
Practice § 26.70 (3d ed. 2015); see also In re
Cal. Pub. Utils. Comm 'n, 892 F.2d 778, 781 (9th
Cir. 1989). Here, Hamilton Capital is not a party to the
litigation. For that separate reason, the communications are
not work product.
accordingly overrule Plaintiffs objection to the Special
Master's Order on the ground that the communications are
non-discoverable attorney work product. (D.I. 379 at 1).
Common Interest Privilege
attorney-client privilege" is a common-law privilege
that "protects communications between attorneys and
clients from compelled disclosure." In re Teleglobe
Commc'ns Corp., 493 F.3d 345, 359 (3d Cir. 2007). In
order for the privilege to apply, there must be "(1) a
communication (2) made between privileged persons (3) in
confidence (4) for the purpose of obtaining or providing
legal assistance for the client." Id. (quoting
Restatement (Third) of the Law Governing Lawyers § 68
(Am. Law. Inst. 2000)). The party asserting the privilege
bears the burden of establishing the requisite elements.
In re Grand Jury, 705 F.3d 133, 160 (3d Cir. 2012).
A communication is only privileged if made in confidence.
Teleglobe, 493 F.3d at 361. Therefore, if
"persons other than the client, its attorney, or their
agents are present, the communication is not made in
confidence." Id. Further, "if a client
subsequently shares a privileged communication with a third
party, then it is no longer confidential, and the privilege
ceases to protect it." Id.
common interest doctrine is an exception to the general rule
that voluntary disclosure to a third party of purportedly
privileged information waives the privilege. Leader
Techs., Inc. v. Facebook, Inc.,719 F.Supp.2d 373, 376
(D. Del. 2010); see also Corning Inc. v. SRU Biosystems,
LLC,223 F.R.D. 189, 190 (D. Del. 2004). The privilege
protects "all communications shared within a proper
'community of interest."' Teleglobe,
493 F.3d at 364 (internal citations omitted). To show that
there is a proper community of interest, the interests
"must be 'identical, not similar, and be legal, not
solely commercial.'" Leader Techs., 719
F.Supp.2d at 376 (quoting In re Regents of the Univ. of
Cat,101 F.3d 1386, 1390 (Fed. Cir. 1996)).
Additionally, to show that the members of the community are
"allied in a common legal cause, " the party
asserting the privilege bears the burden of showing
"that the disclosures would not have been made but for
the sake of securing, advancing, or supplying legal
representation." See In ...