Free Motion to Supplement - District Court of Colorado - Colorado

Case 1:03-cv-02579-RPM

Document 149

Filed 01/12/2007

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I N T HE U NITED S TATES D ISTRICT C OURT F OR T HE D ISTRICT O F C OLORADO Civil Action No. 03-CV-02579-RPM-BNB VARCO, L.P., Plaintiff, vs. PASON SYSTEMS USA CORP., Defendant. PLAINTIFF VARCO'S SUPPLEMENT IN SUPPORT OF ITS DESIGNATION OF DEPOSITION TESTIMONY

At 4:51 p.m. on January 10, 2006 ­ the date on which the parties were required to submit their respective designations of deposition testimony ­ Defendant Pason Systems USA Corp. ("Pason") produced redacted versions of three sets of notes listed on its privilege log ("notes"). (E-mail from Joanna L. Roman to Robert Bowick and Jane Michaels (Jan. 10, 2006), with attachments) (Ex. 1). Given Pason's last-minute disclosure, Plaintiff Varco, L.P. ("Varco") did not have an opportunity to analyze the notes in its Designation of Deposition Testimony. (Pl. Varco's Designation of Dep. Testimony, Doc. 147, at 8 n.2). Thus Varco, by its counsel, respectfully submits this Supplement addressing the notes as further support for its Designation of Deposition Testimony. Pason has redacted extensive portions of the notes on the ground that they "reflect litigation strategy and advice with respect to anticipated litigation rendered by

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[Pason's Canadian opinion counsel, Terry] Leier." (Pason's in Camara Submission and Designation of Dep. Excerpts ("Pason Br.") at 1). 1 These extensive redactions ­ as well as Pason's descriptions of the other documents that it has withheld from production, (id. at 3-5) ­ suggest that Pason defines very broadly the class of documents protected from disclosure because they discuss "litigation strategy." Pason's definition of "litigation strategy" is overbroad, encompassing documents that actually must be disclosed as a result of Pason's "reliance on advice of counsel" defense to Varco's claim of willful patent infringement. Varco's predecessor, Wildcat Automated Drilling Systems, did not contact Pason regarding Pason's infringement of the `142 patent until January 2003. (Letter from William E. Johnson to Pason Systems Corporation (Jan. 14, 2003)) (Ex. 2). Varco did not file suit against Pason until December 2003. (Complaint, Doc. 1). Yet Pason has withheld documents from as early as 2002 because the documents purportedly reflect "litigation strategy." (Pason Br. at 3) (justifying Pason's failure to produce "an October 7, 2002 letter from Mr. Leier to Pason which contains a lengthy discussion of possible litigation with Wildcat"); (id. at 4) (concerning Pason's non-production of "an October 25, 2002 . . . cover letter from Mr. Leier conveying one of his written non-infringement

Pason did not voluntarily serve Varco's counsel with a copy of the submission it made to the court on January 10, 2007. It was not until two days later, on January 12, 2007 ­ and only after Varco's counsel had made several written and telephonic requests to Pason's counsel ­ that Pason finally provided Varco's counsel with a full copy of Pason's January 10, 2007 filing (excluding the documents that were sent to the court for in camera review, which Varco specified it was not requesting). Apparently, Pason believes it has a right to file ex parte briefs with this court, without serving copies on opposing counsel.

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opinions to Pason" that addressed Mr. Leier's efforts to obtain copies of pleadings in infringement lawsuits that Wildcat had filed against other parties to protect Wildcat's rights in the `142 patent). Having reviewed the recently-produced portions of Mr. Leier's files and the redacted notes of meetings in which Mr. Leier participated, it appears that Mr. Leier was providing Pason with his patent opinions on the subject of validity and infringement of the `142 patent, based not only on his patent searches and review of the Bowden patent, but also on his investigation into Wildcat's financial and litigation history. All of Mr. Leier's notes and work product, at least prior to the filing of the litigation in December 2003, relate directly to the opinions he provided to Pason, on which Pason contends it relied in defending against Varco's claim for willful infringement. If there is any question about whether the redacted portions of the notes represent communications on the same subject matter as Mr. Leier's opinions (which must be disclosed under In re EchoStar Communications Corporation, 448 F.3d 1294, 1304 (Fed. Cir. 2006)), or litigation strategy (which need not be disclosed), those questions should be resolved in favor of disclosure. Pason ­ a sophisticated corporate client ­ should not be permitted to withhold material that it otherwise would be required to disclose merely because of Pason's unusual, ill-advised decision to rely on Mr. Leier as both opinion counsel and litigation counsel. Likewise, Pason should be required to produce Mr. Leier's invoices reflecting the work that he undertook in connection with his "opinions" on which Pason claims to

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be relying. Pason has withheld the invoices listed on Pason's privilege log, dated from February 2002 through December 2003, because they purportedly do not concern Mr. Leier's work as opinion counsel, (id. at 4) (withholding PAS 839-51), notwithstanding the fact that one of Mr. Leier's opinion letters is dated October 29, 2002 and the lawsuit was not filed until December 2003. Pason has never produced any invoices from Mr. Leier regarding his work as opinion counsel. Pason's use of a broad definition of "litigation strategy" to redact large portions of the notes stands in sharp contrast to its use of a narrow definition of "subject matter" in determining whether to produce other documents addressing the same subject matter as Mr. Leier's opinions concerning the validity and infringement of the `142 patent. For example, the U.S. Patent and Trademark Office's reexamination of the `142 patent directly addresses the patent's validity, but Pason has withheld documents discussing the status of the reexamination on the ground that it "does not address the infringement issue." (Pason Br. at 3) (withholding PAS 001-003). This is splitting hairs. In fact, Pason's gamesmanship is frustrating Varco's good faith efforts to bring this matter to a trial where the true merits of the case can be determined. For the foregoing reasons, and those in its Designation of Deposition Testimony, Varco respectfully submits that Pason should be ordered to produce all documents, whether favorable or unfavorable, that embody or discuss its communications with opinion counsel concerning whether the `142 patent is valid or infringed by the Pason AutoDriller.

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Dated this 12th day of January, 2007. Respectfully submitted,

s/ Jane Michaels Jane Michaels H OLLAND & H ART LLP 555 Seventeenth Street, Suite 3200 Post Office Box 8749 Denver, Colorado 80201-8749 Tel. (303) 295-8000 Fax (303) 295-8261 [email protected] Robert M. Bowick M ATTHEWS , L AWSON , B OWICK & A L -A ZEM , PLLC 2000 Bering Drive, Suite 700 Houston, Texas 77057 Tel. (713) 355-4200 Fax (713) 355-9689 [email protected] ATTORNEYS FOR PLAINTIFF VARCO, L.P.

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C ERTIFICATE O F S ERVICE I hereby certify that on January 12, 2007, I electronically filed the foregoing with the Clerk of Court using the CM/ECF system which will send notification of such filing to the following: [email protected] [email protected]

s/Jane Michaels

3655323_1.DOC

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