Qualcomm Cites Client Confidentiality in Discovery Mess
The Recorder
August 17, 2007
In a case marred by discovery errors, Qualcomm's trial counsel are in a place no lawyers want to be.
The Day Casebeer Madrid & Batchelder and Heller Ehrman lawyers face the very real prospect of individual sanctions -- and possible California State Bar discipline -- for their mistakes in a San Diego patent case. But they have yet to explain to the judge how, exactly, those discovery blunders came to pass.
That's because Qualcomm has told the magistrate judge in the case that such an explanation would violate attorney-client privilege, according to a transcript from a hearing held last month.
The company, now represented by DLA Piper, argued in a July 26 hearing that the company is facing related litigation in state court against the same adversary, Broadcom. Waiving privilege in the federal case would destroy it in the other litigation, giving Broadcom an unfair advantage there, DLA Piper partner William Boggs told the court.
But federal Magistrate Judge Barbara Major, who will ultimately render the decision on formal sanctions, has not easily swallowed that argument. In the July hearing, Boggs advised her: "If Qualcomm is asserting attorney-client privilege, you cannot draw adverse inferences against them." She replied: "No, but I'm not willing to make inferences in their favor on that basis."
Throughout that hearing, Boggs contended that Qualcomm attorneys made a slew of bad judgment calls during trial but never withheld evidence intentionally or in bad faith. But Major complained several times that Boggs had not produced any evidence to back up his arguments.
Major followed up the frustration she expressed during the July hearing this week by ordering 14 Day Casebeer and Heller attorneys to explain themselves at a special hearing set for Aug. 29.
Specifically, Major has asked them to show cause as to why they should not be subject to sanctions such as fines, State Bar referral, and disclosure of their conduct to all of their firm's current clients.
"They're really between a rock and a hard place," said Francis Morrison III, a longtime intellectual property litigator with Axinn, Veltrop & Harkrider in Connecticut. "It's a very tough place to be because the client owns the privilege and not the lawyers."
Major has asked for explanations from Day Casebeer partners James Batchelder and Lee Patch, as well as Heller partner Stanley Young, in addition to other partners and associates from both firms. Day Casebeer was lead counsel in the case.
During the trial, Patch had directly questioned a Qualcomm witness who, on cross-examination, first revealed the existence of relevant e-mails Qualcomm had not produced in discovery. Broadcom alleges that Patch knew about the e-mails -- Qualcomm's lawyers have since acknowledged learning of their existence 10 days before the witness took the stand -- and crafted his questions so the witness would not reveal their existence.
Major's order comes a week after the trial judge in the case determined that the company committed "gross litigation misconduct" when it failed to turn over hundreds of thousands of relevant documents.
U.S. District Judge Rudi Brewster ordered Qualcomm to pay Broadcom's attorneys fees in the case -- which could be close to $10 million, according to Broadcom, which is represented by Wilmer Cutler Pickering Hale and Dorr.
Day Casebeer attorneys declined to comment through a spokesperson Thursday, saying the firm's "professional and ethical obligations preclude" them from commenting. In an e-mailed statement, Heller Ehrman managing partner Robert Hubbell said "it would not be appropriate" for the firm to speak publicly when a court is preparing to hold a forum on the subject.
"We respect and share [the] Court's desire to protect the integrity of the judicial process and welcome the opportunity to address the Court's concerns," Hubbell wrote. "We will do so in the manner directed by the Court."
Major has given the attorneys until next Wednesday to file written declarations in advance of the hearing. Judging from the July hearing,
Major may be running out of patience.
"Qualcomm has had numerous opportunities, both in front of me and in front of Judge Brewster, to file a declaration if they chose to, and I think the fact that they chose not to speaks volumes.
"With no declarations or evidence in front of me," she added, "I think the evidence that's in the record does lend itself to a finding that Qualcomm either intentionally withheld or intentionally failed to produce all of the documents that are at issue in front of me, or they were grossly negligent or reckless."
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