In re Seagate Technology, L.L.C.
497 F.3d 1360 (Fed. Cir. 2007)
Seagate wanted to market a
product that was similar to a patent held by a company called Convolve.
They asked an independent attorney, Sekimura, to write an opinion
letter about whether their product
would infringe Convolve.
Sekimura wrote several opinion
letters saying that Convolve's patents
were unenforceable and even if they were, Seagate was not infringing.
Convolve sued Seagate for
infringing on one of their patents.
Convolve argued that Seagate
was a willful infringer.
A willful infringer is someone who actively knows that they are
copying someone else's patent. In cases of willful
infringement, attorney's fees can be
awarded, per 35 U.S.C. §285.
Seagate argued that they
weren't a willful infringer
because they had relied on Sekimura's opinion letter.
Seagate introduced
Sekimura's letters into evidence.
At trial, Convolve asked for
discovery of all of Seagate's lawyers' written opinions of Sekimura's
conclusions. Seagate opposed the request.
Seagate argued that the
information was not discoverable because of attorney-client privilege.
Convolve argued that Seagate
waived their attorney-client privilege (and work product privilege) by introducing Sekimura's letter.
Generally, under the rules
of evidence, you can't waive part
of attorney-client privilege.
If you want to disclose part of it to your advantage, you have to
disclose all of it.
The Trial Court ordered
Seagate to turn over the information. Seagate appealed.
The Appellate Court reversed.
The Appellate Court
overruled Underwater Devices Inc. v. Morrison-Knudsen Co. (717 F.2d 1380 (1983)) and found that the
standard for proving willful infringement was objective recklessness.
Underwater had held that that where a potential
infringer has actual notice of another's patent rights, he has an
affirmative duty to exercise due care to determine whether or not he is
infringing. This duty includes seeking out competent legal advice
before making a potentially infringing product.
That was similar to a negligence standard.
Under the new recklessness standard, you had to prove by clear and
convincing evidence that the infringer acted despite an objectively high
likelihood that they were infringing a patent.
The standard for punitive
damages in tort law is recklessness,
not negligence, so if you
think of §285 damages as being a form of punitive
damages, then this make more sense than the Underwater standard.
The Court found that
Seagate's opinion counsel (Sekimura) and their trial counsel (who
prepared the case for trial) were different, and so releasing Sekimura's opinion
letter did not constitute a blanket
waiver of attorney-client privilege.
The Court found that
extended to work product as well.
But, if you commission a
bunch of opinion letters from a
bunch of independent lawyers, and just try to introduce the most
favorable one, the other less favorable letters are probably also
discoverable.