Advanced Messaging Technologies Inc v. EasyLink Services International Corporation, No. 2:2011cv04239 - Document 138 (C.D. Cal. 2012)
Court Description: ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS MOTION TO DISQUALIFY COUNSEL PERKINS COIE AND TO COMPEL DISCOVERY 77 by Judge Dean D. Pregerson:The Motion is GRANTED as to disqualifying Perkins, but is DENIED as to compelling discovery. Accor dingly, IT IS HEREBY ORDERED: 1) Perkins is disqualified from representing Defendants in this litigation. Defendants shall have until January 11, 2013, to retain successor counsel and have such counsel appear in the action. 2) In connection with the transition to new counsel, Perkins shall have no further involvement in this action, except Perkins may transmit to successor counsel its written files concerning this action, including all documents produced by either party in this action and all pl eadings either filed with the court or exchanged with j2 in this action. 3) Defendants shall immediately screen from further participation in this action Douglas Parker.Parker who have been screened and the required affidavits.4) Successor counsel sh all not communicate with Crowell, Perkins, Douglas Parker, the Attorney, any screened person, or any other person, who had communications with the Attorney about any matter related to this action.5) Defendants shall reimburse j2s reasonable attorneys fees and costs incurred in connection with the Motion. By January 11, 2013, j2 shall submit to Defendants a statement identifying the amount of such fees, together with a breakdown, by attorney, of the amount of time spent on such matters. The parties shall make every effort to resolve any fee dispute without court action. (lc). Modified on 12/19/2012 (lc).
Download PDF
<![CDATA[
Advanced Messaging Technologies Inc v. EasyLink Services International Corporation Doc. 138 1 2 O 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 ADVANCED MESSAGING TECHNOLOGIES, INC., and J2 GLOBAL, INC., 13 Plaintiffs, 14 15 v. EASYLINK SERVICES INTERNATIONAL CORPORATION, 16 17 Defendant ___________________________ 18 ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. CV 11-04239 DDP (AJWx) ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS’ MOTION TO DISQUALIFY COUNSEL PERKINS COIE AND TO COMPEL DISCOVERY [Motion filed on Oct. 15, 2012] I. Introduction 19 Plaintiff j2 Global Communications, Inc. has filed a Motion to 20 Disqualify Counsel Perkins Coie and to Compel Discovery (“Motion”) 21 in three patent infringement cases (“the Three Current Cases”) 22 pending before this court. 23 Messaging Technologies, Inc. is a co-Plaintiff and co-movant in two 24 of the cases (9-4150 and 11-4239) (Plaintiffs are collectively 25 called “j2”). 26 corporations is a defendant: Open Text Corporation (“Open Text”) (Dkt. No. 77.)1 Plaintiff Advanced In each case, one or more of the following 27 28 1 The three case numbers are: 11-4239,9-4189, and 9-4150. As each Motion essentially implicates the same issues in each case, all cites will be to the 11-4239 case, unless otherwise noted. Dockets.Justia.com 1 EasyLink Services International Corporation (“EasyLink”), and 2 Captaris, Inc. (“Captaris”) (collectively “Defendants”). 3 owns Easy Link and Captaris. 4 the Defendants. 5 (“Crowell”) about assigning one of its attorneys to temporarily 6 serve as Open Text’s outside in-house counsel for intellectual 7 property matters. 8 fill this role, even though a conflicts check revealed the Attorney 9 formerly represented j2. Open Text Perkins Coie (“Perkins”) represents In late 2011, Open Text contacted Crowell & Moring Crowell assigned an attorney (“the Attorney”) to In fact, he worked on cases on behalf of 10 j2 that involved three of the four patents at issue in the Three 11 Current Cases. 12 Attorney had contact with Perkins. 13 disqualifies Perkins. 14 is not a molecule of evidence that Perkins did anything other than 15 act with integrity and in a manner consistent with the highest 16 traditions of the legal profession. 17 As Open Text’s outside in-house counsel, the The court therefore This outcome is unfortunate, because there In reaching its decision, the court has considered j2's in 18 camera evidence, which includes billing records of the Attorney’s 19 work for j2, and various emails that the Attorney sent and received 20 in the course of his j2 representation. 21 Billing Records and Emails (“In Camera Evidence”).) 22 I. Background (In Camera Evidence of 23 A. The Attorney’s Experience at the Time He Represented j2 24 The Attorney worked at Kenyon & Kenyon (“Kenyon”) from 2002 to 25 2005, and began representing j2 as part of a team of attorneys in 26 2004. 27 that assigning the Attorney to Open Text was appropriate in part 28 because he was only “a junior associate” when he represented j2. (Bernstein Decl. ¶¶ 4-5, Dkt. No. 77-2.) 2 Crowell maintains 1 (Sacks Decl. Ex. F at 16, Dkt. No. 77-3.) Although the Attorney 2 was an associate in 2004, by the end of that year he had many years 3 of experience as a software engineer, studied graduate-level 4 Computer Science, graduated cum laude from a reputable law school 5 (where he served as Managing Editor of the Law Review), edited a 6 publication about the International Trade Commission, co-authored 7 another about patent litigation, and delivered a speech about 8 international patent licensing. 9 113.) (Johnson Decl. Ex. 14, Dkt. No. 10 B. The Work the Attorney Performed for j2 11 Crowell also asserts that the Attorney cleared its conflicts 12 check because he allegedly told Crowell that “he did not recall 13 having access to any confidential information,” and his 14 representation of j2 “involved primarily the review of publicly 15 available patent documents.” 16 77.) 17 (Sacks Decl. Ex. B. at 6, Dkt. No. The records before that court indicate that from 2004 until 18 2005 the Attorney represented j2 in patent litigation, and he 19 billed j2 for 234.7 hours of work. 20 Evidence.) 21 234.7 hours probably represents about ten percent of his billing 22 over the roughly fifteen months that he worked on j2 matters. 23 Specifically, the Attorney billed j2 69.8 hours for his work on j2 24 Global Communications, Inc. v. Venali, Inc. (“Venali”), 84.6 hours 25 for j2 Global Communications, Inc. v. CallWave, Inc. (“CallWave”) 26 (collectively “the Prior Cases”), and 56 hours for “Bobo” patent 27 analysis. (Id. ¶¶ 5-6; In Camera Based on the court’s knowledge of law firm practices, (Bernstein Decl. ¶¶ 2, 6-7.) 28 3 1 In the Venali and Callwave actions, j2 alleged infringement of 2 U.S. Patent Nos. 6,208,638 (“‘638 Patent”) and 6,350,066 (“‘066 3 Patent), and it also alleged infringement of U.S. Patent No. 4 6,597,688 (“‘688 Patent”) in the Venali case. 5 2.) 6 Patent is one of them. 7 ‘638 and ‘688 Patents were infringed in each of the Three Current 8 Cases, and that the ‘066 Patent was also infringed in two of those 9 cases.2 10 (Bernstein Decl. ¶ A number of patents comprise the Bobo patents, and the ‘066 (Bernstein Decl. ¶ 7.) j2 alleges that the The Attorney’s billing records from Kenyon indicate he was 11 involved in the following tasks on behalf of j2: “reviewing claim 12 charts, performing infringement analyses, searching for and 13 analyzing prior art, drafting a validity opinion, analyzing 14 documents for a settlement conference, reviewing and commenting on 15 draft pleading, discussing discovery strategies, drafting discovery 16 requests and responses, and drafting j2’s opposition to a summary 17 judgment motion in the Venali action.” 18 Camera Evidence.) 19 sometimes by forwarding), or was copied on over 120 emails to or 20 from j2's General Counsel. 21 Evidence.) 22 individuals, and sometimes involved evaluations of j2's cases. 23 Camera Evidence.) 24 possible infringement defenses. 25 Evidence.) (Bernstein Decl. ¶ 6; In The Attorney sent, received (sometimes directly, (Bernstein Decl. ¶ 9; In Camera These emails were sent to about seven or eight One email the Attorney received analyzed (Bernstein Decl. ¶ 12; In Camera That email discussed Dr. David Farber (“Dr. Farber”), 26 27 28 (In 2 Those two are case numbers 11-4239 and 9-4150. 4 1 and whether his activities are relevant to an on-sale bar defense.3 2 (In Camera Evidence.) 3 In the Three Current Cases, Defendants claim products that Dr. 4 Farber was allegedly involved in testing and analyzing give rise to 5 an on-sale defense to j2's ‘688 and ‘638 patent infringement 6 claims. 7 15:5, Dkt. No. 48.) 8 Kenyon, the United States Patent Office began a multi-year 9 reexamination of the ‘066, ‘638, and ‘688 Patents, which led to (Bernstein Decl. ¶ 12; In Camera Evidence.) (Defendant’s Answer to Amended Compl. (“Answer”) at 10:24In 2005, the year that the Attorney left 10 changes in at least the ‘066 and ‘638 Patents. 11 16-18, Dkt. No. 101; See id. Exs. E-K.) (Carmody Decl. ¶¶ 12 C. History of the Three Current Cases 13 j2 filed two of the Three Current Cases on June 26, 2008, and 14 the other on May 17, 2011.4 15 actions (“the EasyLink Cases”) (case numbers 9-4189 and 11-4239), 16 and Open Text and Captaris are defendants in the other (9-4150). 17 Open Text owns both of these other companies, acquiring Captaris in 18 2008 and EasyLink in 2012. 19 an attorney (“Lead Trial Counsel”) to represent it and Captaris in 20 2008, before Lead Trial Counsel was at Perkins. 21 ¶ 5, , Dkt. No. 100.) EasyLink is a defendant in two of the (Davies Decl. ¶ 2.) Open Text retained (See Carroll Decl. Lead Trial Counsel moved to Perkins in 22 23 24 25 26 27 3 The on-sale bar affirmative defense invalidates a patent if “(1) the invention at issue had become the ‘subject of a commercial offer for sale’ more than one year before the filing of the patent application; and (2) the invention was ready for patenting, either by, for example, having that invention reduced to practice or by preparing ‘drawings or other descriptions of the invention’ that would enable one skilled in the art to practice the invention.” Special Devices, Inc. v. OEA, Inc., 270 F.3d 1353, 1354-55 (Fed. Cir. 2001) (quoting Pfaff v. Wells Elecs., Inc., 525 U.S. 55, 67-68 (1998). 4 28 Compl., Dkt. No. 3 (case no. 9-4150); Compl., Dkt. No. 3 (case no. 94189); Compl., Dkt. No. 1 (case no. 11-4239). 5 1 February 2012, and Open Text made Perkins its counsel of record 2 when he did. 3 another Perkins attorney began advising Open Text about the 4 EasyLink acquisition in mid-February 2012. 5 unclear when Perkins began working on the EasyLink Cases, but it 6 was before Dr. Farber’s deposition, which took place on July 27, 7 2012. (Carroll Decl. ¶¶ 14-15.) Lead Trial Counsel and (Id. at ¶ 20.) It is (Id. ¶¶ 28-29.) 8 D. The Conflicts Check and the Attorney’s Open Text Assignment 9 The Attorney is now Counsel at Crowell. (Johnson Decl. Ex. 10 14.) 11 to work on “intellectual property and patent matters,” but was 12 “unable to fill the role even as Open Text’s intellectual property 13 and patent needs grew.” 14 provide an attorney who could temporarily assume this position 15 until a permanent candidate was selected. 16 Crowell assigned the Attorney to fill this role, even though it 17 knew that he previously represented j2 18 at 6.) In 2011, Open Text began searching for an in-house attorney 19 (Davies Decl. ¶ 6.) It asked Crowell to (Id.) As discussed, (Id. ¶ 9; Sacks Decl. Ex. B j2 was never asked to sign a conflict waiver, allowing the 20 Attorney to work for Open Text. 21 likewise knew nothing about the Attorney’s prior involvement with 22 j2. (Bernstein Decl. ¶ 13.) Perkins (See Parker Decl. ¶ 4, Dkt. No. 103; Carroll Decl. ¶ 24.) 23 The Attorney told Open Text’s General Counsel that while he 24 was at Kenyon he “performed a public art search relating to a Bobo 25 patent,” and the General Counsel states that he “did not understand 26 this to mean that [the Attorney] had worked for j2.” 27 ¶ 4.) 28 /// 6 (Parker Decl. 1 E. The Attorney’s Role in the Three Current Cases 2 In his role with Open Text, the Attorney met with Perkins on a 3 number of occasions. (Id. ¶ 6.) 4 Attorney’s work for Open Text as follows: 5 Crowell has described the He was given an initial assignment for Open Text during the fourth quarter of 2011 to familiarize himself with the company's products and pending IP litigations. That process included his introductions to Perkins Coie lawyers representing Open Text . . . . Later, he was asked to assist Open Text in collecting documents for Perkins Coie's use in responding to discovery requests. As [the Attorney] became more familiar with the j2 litigation, he followed Perkins Coie's litigation work and provided his views and comments thereon to Open Text in-house counsel, together with reports on the progress of the litigation. After j2 proposed that the parties mediate their dispute, [the Attorney] assisted Open Text with preparation for the mediation that was to have occurred in May 2012. 6 7 8 9 10 11 12 (Sacks Decl. Ex. F. at 16, Dkt. No. 77.) 13 Attorney’s role at Open Text on July 27, 2012, during the 14 deposition of Dr. Farber, when he introduced himself as Open Text’s 15 “outside in-house counsel” to one of j2's attorneys at Kenyon 16 (Bernstein Decl. ¶ 13.) 17 announced that the Attorney used to be an associate at Kenyon, and 18 that he would check whether the Attorney worked on j2 patent 19 matters. 20 informed Perkins and Open Text that the Attorney had worked for j2. 21 (Id.) 22 j2 learned of the At the Farber deposition, j2's attorney (Carroll Decl. ¶ 30.) The next week, j2's attorney Two events followed the Farber deposition, but it is unclear 23 which occurred first. 24 record at the time, King & Spaulding, “where we [King & Spalding] 25 presented to [the Attorney] our evaluation of the litigation.” 26 (Sacks Decl. Ex. J at 32.)5 The Attorney met with EasyLink’s counsel of Additionally, Perkins and Open Text 27 5 28 As discussed, Perkins began working on the EasyLink Cases sometime before (continued...) 7 1 ended communication with the Attorney. 2 Decl. ¶¶ 31-32.) 3 (Davies Decl. ¶ 15; Carroll II. Legal Standards and Analysis 4 There are five issues: (1) Whether California law governs;(2) 5 Whether the court should presume the Attorney learned confidential 6 information about j2 that is relevant to the Three Current Cases; 7 (3) Whether the court should presume that the Attorney shared j2's 8 confidential information with Perkins; (4) Whether such a 9 presumption is irrebutable; and (5) Whether disqualifying Perkins 10 11 is required. Regarding the first issue, California law governs. In re 12 County of Los Angeles, 223 F.3d 990, 995 (9th Cir. 2000). 13 the second through fifth, the California Supreme Court has stated 14 the following: 15 16 17 18 19 20 21 22 23 24 25 As to That enduring duty to preserve client confidences precludes an attorney from later agreeing to represent an adversary of the attorney's former client unless the former client provides an informed written consent waiving the conflict. If the attorney fails to obtain such consent and undertakes to represent the adversary, the former client may disqualify the attorney by showing a substantial relationship between the subjects of the prior and the current representations. To determine whether there is a substantial relationship between successive representations, a court must first determine whether the attorney had a direct professional relationship with the former client in which the attorney personally provided legal advice and services on a legal issue that is closely related to the legal issue in the present representation. If the former representation involved such a direct relationship with the client, the former client need not prove that the attorney possesses actual confidential information. Instead, the attorney is presumed to possess confidential information if the subject of the prior representation put the attorney in a position in which confidences material to the current representation would normally have been imparted to counsel. . . . When a substantial relationship between the two 26 27 28 5 (...continued) the Farber deposition, but Perkins did not appear as counsel of record on behalf of EasyLink until October 11, 2012. (See Carroll Decl. ¶ 21.) 8 1 2 3 4 representations is established, the attorney is automatically disqualified from representing the second client. . . . Vicarious disqualification rules are a product of decisional law. Normally, an attorney's conflict is imputed to the law firm as a whole on the rationale that attorneys, working together and practicing law in a professional association, share each other's, and their clients', confidential information. 5 City & County of San Francisco v. Cobra Solutions, Inc., 38 Cal. 6 4th 839, 847-48 (2006) (internal citations and quotation marks 7 omitted). 8 disqualification motions generally because the Attorney worked as 9 Open Text’s outside in-house counsel, not as a Perkins attorney. The facts in this Motion are not typical of 10 However, the court holds the above-quoted rule applies here. 11 Attorney’s prior representation involved three of the four patents 12 at issue in the Three Current Cases, as well as an on-sale bar 13 defense related to Dr. Farber’s activities. 14 representation is, thus, substantially similar to the Three Current 15 Cases. 16 Text on IP matters, and because of his contact with Perkins, 17 Perkins must be disqualified. The The prior Because the Attorney was outside in-house counsel for Open 18 A. 19 Defendants argue that while federal courts in California look 20 to California law in deciding a disqualification motion, state law 21 does not bind them in the way that a diversity case would, because 22 federal courts are governed by their own rules of professional 23 conduct. 24 Disqualify (“Opp’n”) at 12:26-13:7, Dkt. No. 97.) 25 Circuit, however, has made clear that a federal court in California 26 must apply California law in a disqualification motion. 27 County of Los Angeles, 223 F.3d at 995 (“[W]e apply state law in 28 determining matters of disqualification.”). California Law Governs (Defendant’s Opposition to Plaintiffs’ Motion to 9 The Ninth In re 1 Defendants’ argument relies principally on a footnote from an 2 unpublished Northern District of California case. Openwave Sys., 3 Inc. v. 724 Solutions (US) Inc., No. C 09-3511 RS, 2010 WL 1687825, 4 at *5 n.6 (N.D. Cal. Apr. 22, 2010). 5 applied California law, because its local rule required attorneys 6 to adhere to “California State Bar standards.” 7 District similarly requires attorneys to “comply with the standards 8 of professional conduct required of members of the State Bar of 9 California and contained in the State Bar Act, the Rules of However, even that case Id. The Central 10 Professional Conduct of the State Bar of California, and the 11 decisions of any court applicable thereto.” 12 3.1.2. 13 “statutes, rules and decisions.” 14 governs. 15 16 17 B. Cent. Dist. L.R. 83- The Central District rule “adopt[s]” such California Id. California law, therefore, The Court Presumes the Attorney Possesses Confidential Information about j2 It is presumed that an attorney has relevant confidential 18 information about a client if there is a substantial relationship 19 between the prior representation and the current one. 20 Solutions, 38 Cal. 4th at 847. 21 substantial relationship, the court should first analyze whether 22 there was a direct relationship between an attorney and the former 23 client, and whether that relationship touched issues related to the 24 present litigation. 25 determining whether there was a direct relationship. 26 Farhang v. Indian Inst. of Tech., No. C-08-02658RMW, 2009 WL 27 3459455, at *2 (N.D. Cal. Oct. 27, 2009). 28 time representing j2, he and j2's General Counsel were part of a Id. Cobra In determining whether there is Courts emphasize shared communications in 10 See e.g. During the Attorney’s 1 group of about seven or eight attorneys that regularly sent emails 2 to each other. (Bernstein Decl. ¶ 9; In Camera Evidence.) 3 the Attorney and j2's General Counsel were parties to over 120 4 emails. 5 to an on-sale bar defense, which is also at issue in the Three 6 Current cases. 7 on the Prior Cases, where three of the four patents currently at 8 issue were litigated. (Id.) 9 Prior Cases shared drafts of papers that would later be filed with (Id.) In total One email concerned Dr. Farber, and his relevance (In Camera Evidence.) Many of these emails focused Some of the emails relating to the 10 the court, and others assessed the strength of j2's cases. 11 In light of these exchanges, the court finds that a direct 12 relationship between the Attorney and the client existed. 13 When an attorney had direct contact with a client, a (Id.) 14 substantial relationship exists if “the subject of the prior 15 representation put the attorney in a position in which confidences 16 material to the current representation would normally have been 17 imparted to counsel.” 18 substantial relationship test is “necessarily fact-dependant.” UMG 19 Recordings, Inc. v. MySpace, Inc., 526 F. Supp. 2d 1046, 1060 20 (C.D. Cal. 2007). 21 “subject-matters, facts or issues” to determine whether there is a 22 substantial relationship. 23 Salomon Brothers, Inc., 229 Cal. App. 3d 1445, 1453 (1991)). 24 Subject matter similarity is the most important. 25 Hartford Cas. Ins. Co., 111 Cal. App. 4th 698, 711 (2003) 26 (suggesting that the California Supreme Court has decided that “a 27 ‘substantial relationship’ exists whenever the ‘subjects’ of the 28 prior and the current representations are linked in some rational Cobra Solutions, 38 Cal. 4th at 847. The Courts look to the degree of overlap in See id. (quoting H.F. Ahmanson & Co. v. 11 Jessen v. 1 manner”) (citing Flatt v. Superior Court, 9 Cal. 4th 275, 283 2 (1994)). 3 and factual issues involved in the compared representations,” as 4 it includes “information material to the evaluation, prosecution, 5 settlement or accomplishment of the litigation or transaction 6 given its specific legal and factual issues.” 7 App. 4th at 712-13. 8 9 A “subject” is “broader . . . than the discrete legal Jessen, 111 Cal. Defendants argue that there is no substantial relationship because the Three Current Cases “involve different defendants, 10 claims and evidence,” and they emphasize that “[i]n the 11 intervening years between [the Attorney’s j2 representation and 12 his representation of Open Text], the patents have been reexamined 13 by the PTO and their claims have been substantially altered.” 14 (Opp’n at 22:7-10.) 15 altered, but to different degrees. 16 the reexamination process required “extensive changes to the ‘066 17 patent” and “significant changes to the ‘638 patent,” but not 18 noting any level of change in the ‘688 patent); see also Carmody 19 Decl. ¶¶ 16-18 (describing the changes similarly).) 20 It is true that the patents have been (See Opp’n 10:13-21 (claiming More importantly, nothing requires the court to extensively 21 analyze the patents’ modifications, nor to do an in-depth 22 comparison of the products. 23 between the subject matter of the two cases will suffice. 24 111 Cal. App. 4th at 711 (2003); Knight v. Ferguson, 149 Cal. App. 25 4th 1207, 1213 (2007).6 To the contrary, a rational link Jessen, In addition to other matters the Attorney 26 6 27 28 Anything more than a “rational link” test would effectively require a mini-trial on the merits, entailing a comparison of the patents as they existed initially with any subsequent modifications. Expert testimony would then likely (continued...) 12 1 billed to j2, he billed j2 154.4 hours for work on the Prior 2 Cases, which involved three of the four patents at issue in the 3 Three Current Cases. 4 (See Bernstein Decl. ¶¶ 2, 6.) Additionally, the on-sale bar defense was at issue in the 5 cases the Attorney worked on as j2's attorney, and as j2's 6 attorney he received an email evaluating Dr. Farber’s relevance to 7 this defense. 8 relevant to a possible on-sale bar defense in the Three Current 9 Cases, as well. (In Camera Evidence.) Dr. Farber’s activities are (See Answer at 10:24-15:5.) In fact, j2 learned 10 of the Attorney’s work with Open Text in the Three Current Cases, 11 when he attended Dr. Farber’s deposition. 12 In disputing Dr. Farber’s importance to the disqualification 13 analysis, Defendants argue that they knew about him, along with 14 his import to an on-sale bar defense, before the Attorney became 15 involved with Open Text. 16 Bellows Decl. ¶ 2, Dkt. No. 104.) 17 could have provided additional useful to Perkins concerning Dr. 18 Farber. 19 Three Current Cases the court presumes that the Attorney possessed 20 confidential information. 21 847-48. 22 23 (Bernstein Decl. ¶ 13.) (Opp’n at 8:6-11; Carmody Decl. ¶¶ 9-12; However, the Attorney still Because the Prior Cases are substantially related to the See Cobra Solutions, 38 Cal. 4th at At times, Defendants refer to the Attorney as a “junior associate,” and assert that there is a “lack of evidence” about 24 6 25 26 27 28 (...continued) have to be presented and evaluated. Such a time-consuming process would add little value. The court would still not know whether the former attorney may have, even unwittingly, communicated important information about, for example, the financial strength of the former client, the former client's settlement strategy, the former client’s perceived strengths or weaknesses of its claims or defenses, and other information that might give counsel an unfair advantage in the litigation. 13 1 both the “nature of the work” he did for j2 and whether he 2 acquired confidential information about j2. 3 Supplemental Brief in Support of Defendant’s Opposition to j2's 4 Motion to Disqualify Perkins Coie and Compel Discovery (“Supp. 5 Opp’n.”) at 10:22-11:5, Dkt. No. 122.) 6 level of involvement with a prior case is sufficient for presuming 7 that an attorney acquired confidential information about that 8 prior case. 9 70, 73-74 (2005) (finding that a one-hour phone call about a case (Defendants’ However, a de minimis See Pound v. DeMera DeMera Cameron, 135 Cal. App. 4th 10 three years earlier was sufficient to presume that an attorney 11 acquired confidential information). 12 Regardless, both the Attorney’s professional experience and 13 the extent of his work for j2 were significant. 14 was representing j2, he had authored and edited publications about 15 intellectual property, done graduate work in computer science, and 16 worked for many years as a software engineer. 17 14). 18 Prior Cases included: “reviewing claim charts, performing 19 infringement analyses, [reviewing] prior art . . . analyzing 20 documents for a settlement conference, reviewing and commenting on 21 draft pleading, discussing discovery strategies, drafting 22 discovery requests and responses, and drafting j2’s opposition to 23 a summary judgment motion . . .” 24 Evidence.) 25 strategies and participating in the creation and editing of 26 motions and pleadings, the likelihood that he learned confidential 27 information is readily apparent. 28 prior art, the risk may seem less likely. At the time he (Johnson Decl. Ex. Additionally, in camera evidence shows that his work in the (Bernstein Decl. ¶ 6; In Camera In some of this work, such as discussing discovery In others, such as reviewing 14 However, confidential 1 information may guide prior art reviews—such as an instruction 2 from a partner or client about the weaknesses of certain features. 3 C. 4 5 The Court Presumes that Perkins has the Same Confidential Information about j2 as the Attorney The general rule is that presuming an attorney possesses 6 confidential information requires presuming the same for his law 7 firm (“the Vicarious Presumption Rule”). 8 of Corporations v. SpeeDee Oil Change Sys., Inc., 20 Cal. 4th 9 1135, 1146 (1999) (ruling that “a presumption that an attorney has See People ex rel. Dept. 10 access to privileged and confidential matters relevant to a 11 subsequent representation extends the attorney's disqualification 12 vicariously to the attorney's entire firm”); see id. at 1153-54 13 (explaining that, “[t]he vicarious disqualification rule 14 recognizes the everyday reality that attorneys, working together 15 and practicing law in a professional association, share each 16 other's, and their clients', confidential information”). 17 Attorney, however, does not work at Perkins. Rather, he was 18 outside in-house counsel for Open Text on intellectual property 19 matters. 20 court is not aware of any case analyzing whether the Vicarious 21 Presumption Rule applies to such a situation. However, some cases 22 have analyzed whether presuming an attorney at one law firm has 23 confidential information requires making the same presumption 24 about another firm that is co-counsel with the tainted attorney. 25 These cases come out different ways, but the cases applying the 26 Vicarious Presumption Rule to co-counsel have the better argument. 27 Three Northern District of California cases suggest that 28 (Davies Decl. ¶¶ 6, 9; Bernstein Decl. ¶ 13.) The This presuming co-counsel possesses confidential information is 15 1 inappropriate. In re Airport Car Rental Antitrust Litig., 470 F. 2 Supp. 495, 506 (N.D. Cal. 1979); see also Canatella v. Krieg, 3 Keller, Sloan, Reilley & Roman LLP, No. C 11-05535 WHA, 2012 WL 4 847493, at *2 (N.D. Cal. Mar. 13, 2012) (making no mention of a 5 presumption, and relying on Airport Car Rental to suggest that a 6 multi-factor analysis is required to determine whether co-counsel 7 has confidential information); 8 Tech. Distributors, LLC, No. 11-CV-01043-LHK, 2011 WL 2940313, at 9 *6 (N.D. Cal. July 20, 2011). Oracle Am., Inc. v. Innovative Other cases have applied the 10 Vicarious Presumption Rule and presumed that co-counsel received 11 confidential information. Pound, 135 Cal. App. 4th at 77 (noting 12 the Vicarious Presumption Rule, and holding that “there is no 13 logical or substantive manner to distinguish” between a firm 14 employing a tainted attorney and a firm serving as co-counsel with 15 a tainted attorney); 16 2d 1068, 1078, 1084 (C.D. Cal. 2012) (stating the Vicarious 17 Presumption Rule, and applying it against co-counsel, because 18 “[i]t is also reasonable to assume that the two law firms engaged 19 in fairly extensive discussions about the case and Plaintiff's 20 litigation strategy before filing their complaint and prior to the 21 erection of an wall ethical segregating [the tainted attorney] 22 from the case”). Beltran v. Avon Products, Inc., 867 F. Supp. 23 This court concludes that the Vicarious Presumption Rule 24 should be applied here (i.e., that it should be presumed that 25 Perkins has relevant confidential information about j2.) 26 three Northern District cases that did not apply the Vicarious 27 Presumption Rule to co-counsel are not persuasive. 28 consider applicable California law. 16 The They do not Oracle and Canatella rely 1 heavily on Airport Car, which was decided in 1979. Canatella, 2012 2 WL 847493, at *2, Oracle,, 2011 WL 2940313, at *5. 3 neither Oracle nor Canatella considered Pound, a California 4 appellate case that presumed co-counsel possessed the tainted 5 attorney’s confidential information. 6 77 (2005). 7 either case. 8 incorrectly declares that on “the issue of disqualification of co- 9 counsel . . . no California . . . cases [are] directly on point.” It seems Pound, 135 Cal. App. 4th 70, And Pound does not appear to have been briefed in (Johnson Decl. Exs. 6-11.) Canatella even 10 Canatella, , 2012 WL 847493, at *2. 11 courts have generally ignored these three cases. 12 the only one cited in any California opinion, and a single case 13 from 1980 is the only one that cites its holding approvingly. 14 Chadwick v. Superior Court, 106 Cal. App. 3d 108, 117 n.9 (1980). 15 Additionally, California Airport Car is More importantly, the reasoning behind the Vicarious 16 Presumption Rule indicates that it should also be applied against 17 Perkins: “Normally, an attorney's conflict is imputed to the law 18 firm as a whole on the rationale that attorneys, working together 19 and practicing law in a professional association, share each 20 other's, and their clients', confidential information.” 21 Solutions, 38 Cal. 4th at 847-48. (internal quotation marks 22 omitted.) 23 counsel for intellectual property matters, and the Three Current 24 Cases are high-stakes, complex patent matters. 25 in-house counsel effectively cooperating, coordinating, and 26 communicating with their company’s attorneys is self-evident. 27 Defendants’ argument that the Attorney “played a limited 28 Cobra The Attorney served as Open Text’s outside in-house role” in the Three Current Cases is unavailing. 17 The importance of (Carroll Decl. ¶ 1 25.) It is probably a stretch to characterize Open Text’s outside 2 in-house counsel for intellectual property matters–an experienced 3 attorney who was also Counsel at Crowell—as playing an 4 inconsequential role in three major patent cases. 5 concern aside, though, cases do not analyze how much work a 6 tainted attorney performed in the cases for which disqualification 7 is sought. 8 plaintiff’s firm after it and the tainted outside counsel “briefly 9 discussed the case” and met with plaintiffs “a few times.”) Leaving that See Pound, 135 Cal. App. 4th at 74 (disqualifying Under 10 the Vicarious Presumption Rule, once an attorney is presumed to 11 have confidential information, her law firm is presumed to have 12 it, too. 13 Cal. 4th at 283. 14 15 16 Cobra Solutions, 38 Cal. 4th at 847-48; See Flatt, 9 D. The Presumption Against Perkins Is Irrebutable and Thus Disqualification Is Mandatory Once there is a presumption that a firm possesses 17 confidential information, generally that presumption is 18 irrebutable and disqualification is compelled. 19 Supreme Court has said: 20 21 22 23 As the California Where the requisite substantial relationship between the subjects of the prior and the current representations can be demonstrated, access to confidential information by the attorney in the course of the first representation (relevant, by definition, to the second representation) is presumed and disqualification of the Attorney's representation of the second client is mandatory; indeed, the disqualification extends vicariously to the entire firm. 24 Flatt, 9 Cal. 4th at 283 (emphasis in original); see generally 25 Pound, 135 Cal. App. 4th 70 (applying mandatory disqualification 26 rule to law firm with tainted co-counsel); In re County of Los 27 Angeles, 223 F.3d at 995 (noting that “[t]he [California] courts 28 18 1 of appeal developed a general rule that the presumption is not 2 rebuttable”). 3 However, in one case the California Supreme Court held that 4 it “need not consider whether an attorney can rebut a presumption 5 of shared confidences, and avoid disqualification, by establishing 6 that the firm imposed effective screening procedures.” 7 Oil, 20 Cal. 4th at 1151; see also In re County of Los Angeles, 8 223 F.3d at 997 (interpreting SpeeDee Oil as suggesting that the 9 California Supreme Court “may be inclined” to allow law firms to 10 erect ethical walls to avoid disqualification); but see Beltran, 11 867 F. Supp. 2d 1068, 1083 (C.D. Cal. 2012) (doubting that ethical 12 screening can prevent disqualification); 13 at 1061 (questioning the same). 14 court has decided that a law firm’s ethical screening permitted it 15 to attempt rebutting the presumption. Kirk v. First Am. Title Ins. 16 Co., 183 Cal. App. 4th 776, 801 (2010) (holding that 17 disqualification is the “general rule,” and that courts “should 18 presume knowledge is imputed to all members of a tainted 19 attorney’s law firm,” but that “in the proper circumstances, the 20 presumption is a rebuttable one, which can be refuted by evidence 21 that ethical screening will effectively prevent the sharing of SpeeDee MySpace, 526 F. Supp. 2d At least one California appellate 22 23 24 25 26 27 28 19 1 confidences in a particular case”) (emphasis in original).7 2 screening must be implemented in a “timely” manner. 3 Such Id. at 810. In the Three Current Cases, the Attorney was not screened 4 until after Dr. Farber’s deposition, approximately eight months 5 after he began serving as Open Text’s outside in-house counsel. 6 (See Parker Decl. ¶¶ 4-5 .) 7 Attorney’s conflict, it did not initiate a timely screen. 8 Kirk., 183 Cal. App. 4th 9 wall must be in place “before undertaking the challenged Since Perkins was unaware of the See at 810 n.31 (suggesting that the ethical 10 representation or hiring the tainted individual” (internal 11 quotation marks omitted); In re County of Los Angeles, 223 F.3d at 12 996 13 individual joined the firm). 14 presumption is irrebutable. (emphasizing screening measures taken before tainted For Perkins, therefore, the 15 E. No Remedy Short of Disqualification Will Suffice 16 Defendants argue that the court should fashion a remedy less 17 drastic than disqualification. 18 No. 122.) 19 20 21 22 (Supp. Opp’n at 8:17-10:10, Dkt. The leading case on point for this issue held: [E]ven when the court has misgivings about the conduct of the challenged attorney, it is not obligated to disqualify that lawyer merely because he has run afoul of the applicable ethical rules. The court is encouraged instead to examine the specific facts and circumstances peculiar to the individual case to decide whether disqualification, or some lesser sanction, would be an appropriate remedy. In other words, even when counsel has been shown to have committed an ethical rule infraction the 23 24 25 26 27 28 7 Defendants argue that Kirk forbids automatically disqualifying a law firm merely because of its association with a tainted attorney, and requires proof that the Attorney shared confidences with the firm before disqualification is appropriate. (See Opp’n at 14:2-12.) Defendants offer declarations from Perkins attorneys and others as proof that they never acquired confidential information from the Attorney. (See Dkt. Nos. 98-105.) However, Kirk only allowed timely ethical screening to rebut the presumption, and further held that “it is not sufficient to simply produce declarations stating that confidential information was not conveyed.” 183 Cal. App. 4th at 801, 810. 20 1 court retains discretion to decline to order disqualification, and, in many cases, courts have done just that. 2 MySpace, Inc., 526 F. Supp. 2d at 1063 (citation omitted). 3 MySpace, however, involved very different facts. That case 4 concerned a law firm that obtained a conflict waiver from its 5 former client, enacted an ethical wall around the attorneys who 6 worked for the prior client before engaging in work for the 7 current client, and whose current client waived the affirmative 8 defense that triggered the conflict—an affirmative defense that 9 was “collateral to what this case is about.” Id. at 1063-65. 10 None of these factors are present here. 11 IV. Conclusion 12 Perkins is disqualified. The court denies the request for 13 further discovery, because the order disqualifies Perkins, screens 14 Open Text’s General Counsel, Douglas Parker, and screens all in15 house attorneys who substantively discussed the Three Current 16 Cases with the Attorney. (See Parker Decl. ¶ 6 (attesting to 17 having been “a participant in many of the instances in which [the 18 Attorney] had an opportunity to communicate with and interact with 19 attorneys from Perkins Coie”). 20 The court finds that none of Perkins’ attorneys had knowledge 21 of the Attorney’s prior j2 representation. Indeed, during oral 22 argument the court characterized Perkins as a victim of Crowell’s 23 inexplicable decision to approve the Attorney to work for Open 24 Text. The court affirms Perkins’ innocence in this matter, and 25 appreciate the professionalism its attorneys have exhibited. 26 Perkins’ innocence though, does not prevent its disqualification. 27 Motions to disqualify are not about punishing guilty parties. 28 21 1 Kirk, 183 Cal. App. 4th at 815. 2 “preserv[ing] public trust in the scrupulous administration of 3 justice and the integrity of the bar.” 4 at 1145. 5 V. Remedies 6 They are primarily about SpeeDee Oil, 20 Cal. 4th The Motion is GRANTED as to disqualifying Perkins, but is 7 DENIED as to compelling discovery. 8 ORDERED: 9 Accordingly, IT IS HEREBY 1) Perkins is disqualified from representing Defendants in 10 this litigation. 11 retain successor counsel and have such counsel appear in the 12 action. 13 Defendants shall have until January 11, 2013, to 2) In connection with the transition to new counsel, Perkins 14 shall have no further involvement in this action, except Perkins 15 may transmit to successor counsel its written files concerning 16 this action, including all documents produced by either party in 17 this action and all pleadings either filed with the court or 18 exchanged with j2 in this action. 19 public documents (collectively “non-public documents”) prepared 20 after November 1, 2011, that contain or otherwise reflect thoughts 21 of disqualified or screened firms or individuals may not be 22 transmitted, unless they are accompanied with a declaration, 23 signed under penalty of perjury, from a partner (“the Partner”) at 24 Perkins with substantial familiarity with this case, attesting as 25 follows: 26 evaluating the propriety of transmitting the non-public documents 27 to successor counsel, and attests to the best of such Partner’s 28 information and belief that the Attorney did not provide, directly However, notes and other non- That the Partner has exercised due diligence in 22 1 or indirectly, any information contained within the non-public 2 documents. 3 3) Defendants shall immediately screen from further 4 participation in this action Douglas Parker. Any other internal 5 counsel or external counsel need not be screened, provided they 6 submit a declaration signed under penalty of perjury, attesting 7 that they have not had substantive communications with the 8 Attorney or with any one else whom they reasonably believe may 9 have received information from the Attorney concerning this 10 action. 11 court with both a list identifying all persons in addition to Mr. 12 Parker who have been screened and the required affidavits. By January 11, 2013, Defendants shall provide j2 and the 13 4) Successor counsel shall not communicate with Crowell, 14 Perkins, Douglas Parker, the Attorney, any screened person, or any 15 other person, who had communications with the Attorney about any 16 matter related to this action. 17 5) Defendants shall reimburse j2’s reasonable attorneys’ fees 18 and costs incurred in connection with the Motion. By January 11, 19 2013, j2 shall submit to Defendants a statement identifying the 20 amount of such fees, together with a breakdown, by attorney, of 21 the amount of time spent on such matters. 22 every effort to resolve any fee dispute without court action. 23 The parties shall make Nothing contained herein is intended to prevent any party, 24 person, or firm from communicating about ministerial or logistical 25 issues required to transition to new counsel. 26 /// 27 28 23 Nothing contained 1 herein is intended to preclude the parties or attorneys from 2 stipulating to additional exceptions to this order in connection 3 with any collateral dispute. 4 5 IT IS SO ORDERED. 6 7 8 Dated: December 19, 2012 DEAN D. PREGERSON United States District Judge 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 24
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
