United States District Court, D. Delaware
DASSO INTERNATIONAL, INC. and EASOON USA, LLC, Plaintiffs,
MOSO NORTH AMERICA, INC. and MOSO INTERNATIONAL BV, Defendants.
Parties recently brought to my attention a discovery dispute
related to certain documents that Plaintiffs have identified
as "privileged." They submitted letters on the
topic. (D.I. 150, 151). I held a discovery dispute conference
on September 3, 2019. At the conference, I overruled
Defendants' objection to Plaintiffs' assertion of
privilege over most of the contested documents. I left
unresolved the issue of whether Plaintiffs can properly
assert privilege over approximately twenty emails exchanged
between Plaintiffs' counsel, Plaintiff Dasso
International Inc.'s CEO Avery Chua, and individuals at
Hangzhou Dasuo Technology Co. Ltd ("HDT").
Following the conference, Plaintiffs produced in
camera two of the disputed emails for my review.
the exclusive licensee of the Chinese counterpart to
Plaintiffs' U.S. Patent No. 8, 709, 578 ('"578
Patent). (D.I. 150). It also manufactures the bamboo decking
product that Plaintiffs distribute. (See D.I. 25 at
19-26). Plaintiffs have consistently denied any official
corporate relationship with HDT. (See, e.g., D.I.
90). They have emphasized that HDT is not a party to
this litigation. (Id.). Rather, they have
characterized their relationship with HDT as "limited to
a contractual right to use the dasso branded name and the
contractual right to distribute branded product."
argue that their communications with HDT are protected under
the "common interest doctrine," an exception to the
general rules governing attorney-client 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
Cal, 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 re Regents of the Univ. of
Cal, 101 F.3d at 1389 (quoting In re Grand Jury
Subpoena Duces Tecum, 406 F.Supp. 381, 386 (S.D.N.Y.
1975)); see also In re Bevill, Bresler & Schulman
Asset Mgmt. Corp., 805 F.2d 120, 126 (3d Cir. 1986).
have not carried their burden to establish that
communications with HDT are privileged. Specifically,
Plaintiffs have not shown that they share an
"identical" legal interest with HDT. It is
undisputed that HDT has no legally cognizable interest in the
'578 Patent. I do not find persuasive Plaintiffs argument
that HDT's interest in the Chinese Patent amounts to a
legal interest identical to Plaintiffs' interest in the
'578 Patent. Far from being identical, the Chinese Patent
is an entirely separate property right that is enforceable
only in China. The mere fact that HDT produces the product
that Plaintiffs sell does not amount to a shared legal
interest. Such an arrangement is the epitome of a purely
commercial interest in this litigation. Thus, as it is
undisputed that Plaintiffs disclosed the contested
communications to third party HDT, I find that any claim of
privilege over those emails is waived.
argues in the alternative that HDT is acting as a consulting
expert pursuant to Federal Rule of Civil Procedure
26(b)(4)(D). That Rule provides:
Ordinarily, a party may not, by interrogatories or
deposition, discover facts known or opinions held by an
expert who has been retained or specially employed by another
party in anticipation of litigation or to prepare for trial
and who is not expected to be called as a witness at trial.
Advisory Committee note further explains:
[Subdivision (b)(4)] does not address itself to the expert
whose information was not acquired in preparation for trial
but rather because he was an actor or viewer with respect to
transactions or occurrences that are part of the subject
matter of the lawsuit. Such an expert should be treated as an
Fed. R. Civ. P. 26 advisory committee's note to 1970
have not carried their burden to show that they meet the
requirements of Rule 26(b)(4)(D). During the discovery
dispute conference, Plaintiffs' counsel represented that
communicating with HDT was the only means he had of getting
factual information about the production of Plaintiffs'
product. That representation indicates to me that HDT cannot
be treated as an expert in this case. Rather, HDT must be
treated as an ordinary witness. Moreover, Plaintiffs have not
produced any evidence indicating that they specially employ
HDT as an expert. They have not, for example, produced any
documents indicating an employment or a retainer agreement
related to HDT serving as an expert. The record indicates,
far from any special agreement, that Plaintiffs and HDT, who
regularly do business together, engaged in conversations
about this litigation during their ordinary course of
business. Accordingly, I find that communications with HDT do
not qualify for Rule 26(b)(4)(D)'s protection from
Plaintiffs' communications with HDT are not privileged or
excepted from discovery by the Rules of Civil Procedure,
IT IS HEREBY ORDERED that communications
that were ...