Free Letter - District Court of Delaware - Delaware

Case 1:04-cv—O1373-KAJ Document 268 Filed 05/O9/2006 Page 1 of 3
MORRIS, NICHOLS, ARSHT gt TUNNELL LLP
1201 NORTH MARKET STREET
P.O. Box 1347
WILMINGTON, DELAWARE 19899-1347
302 658 9200
302 658 3989 FAX
JACK B. BLUMENFELD
302 251 9291
202 425 2012 FAX
[email protected] May 9,
BY ELECTRONIC FILING
The Honorable Kent A. Jordan
United States District Court
844 King Street
Wilmington, DE 19801
RE: Ampex v. Eastman Kodak, C.A. No. 04-1373-KAJ
Dear Judge Jordan:
I write on behalf of Plaintiff Ampex Corporation in connection with the May ll,
2006 conference call.
The issues are the scope of defendants' waiver of the attorney client privilege and
work product, and the scope of defendants' duties in submitting a log for withheld materials, by
virtue of defendants' decision to assert the advice of counsel defense to Ampex's charge of
willful infringement. Ampex seeks an order compelling defendants: 1) to disclose all
infomation communicated to the clients (Kodak, Altek, and Chinon), or reflecting
communications to the clients, on the same subject matter as their September 2, 2005 opinion of
counsel; and 2) to provide a log of all materials withheld on privilege or work-product grounds
dated on or before April 11, 2006, the expiration date of the 'l21 patent in suit.
Background
On April 17, 2006, the Court permitted defendants to amend their answers to
assert the defense of advice of cotmsel and permitted limited additional discovery on the same
subject matter. Pursuant to a Stipulated Order (D.I. 255), the parties tried to resolve all issues
with respect to the scope of the defendants' waiver. The parties accordingly have agreed that: 1)
the scope of the waiver does not include core work product of any outside attorney (i.e.,
information neither referring nor relating to a communication with the client); and, 2) the scope
of the waiver does include communications between trial counsel and the clients referring
expressly to the opinion of counsel. Upon resolution of the remaining scope of waiver issues, the
parties will commence remaining discovery on defendants' advice of counsel defense.

Case 1:04-cv—O1373-KAJ Document 268 Filed 05/O9/2006 Page 2 of 3
The Honorable Kent A. Jordan
May 9, 2006
Page 2
Defendants have produced a single opinion of counsel dated September 2, 2005,
and drafts of that opinion. The opinion was written by an attorney based in Washington, D.C.,
and relates to the issue of infringement. lt was received by defendants approximately a year after
the commencement of this litigation in October, 2004.
Defendants have produced opinion counsel materials, but have not produced trial
counsel materials on the subject matter of infringement other than docrunents referring expressly
to the opinion. Defendants have not produced a privilege log for any trial counsel materials.
Defendants' Withholding of Trial Counsel Materials on the Same Subject
Matter as the September, 2005 opinion
The principal dispute between the parties relates to the extent to which defendants
may withhold communications between trial counsel and defendants on the same subject matter
as the opinion upon which defendants rely for their advice of counsel defense. Defendants have
refused to produce any materials referring or relating to such communications, other than those
that expressly mention the opinion. Thus defendants have produced only a fraction of the
infringement information or advice provided to them — the fraction provided by opinion counsel.
Where, as here, defendants seek to rely on an opinion of counsel received almost
a year after the commencement of litigation — and more than four years after receiving notice of
the '121 patent-in-suit from Ampex — the scope of the waiver includes trial counsel's materials
and advice. Unless defendants produce trial counsel's communications on the same subject
matter — infringement — Ampex will not be able to fully assess, or fairly cross-examine on,
defendants’ state of mind at the time they received the September 2005 opinion of counsel, as
well as their state of mind before and after that time. See, e. g., In re EchoStar Communications
Corp., Misc. Nos. 803, 805, slip op. at 14 (Fed. Cir. May 1, 2006) (infringer's state of mind
detennines scope of waiver) (attached as Ex. A); Chimie v. PPG Indus., Inc. 218 F.R.D. 416, 420
(D. Del. 2003) (same). Defendants should not be able to selectively disclose the advice it
received on the issue of infringement. EchoStar, slip op. at 9; Akeva L.L. C. v. Mizuno Corp., 243
F.Supp.2d 418, 423 (M.D.N.C. 2003).
There are cases in which courts have limited the scope of the waiver to materials
produced by opinion counsel, but they do not apply here. Typically, they involve the receipt of
an opinion of counsel prior to the commencement of litigation. The theory behind foreclosing
discovery of trial counsel materials in these cases is temporal: that the waiver cuts-off when the
litigation is filed. See, e. g., Dunhall Pharmaceuticals, Inc. v. Discus Dental, Inc., 994 F.Supp.
1202 (C.D. Cal. 1998) (limiting discovery of trial counsel materials to those generated prior to
commencement of suit).
In EchoStar, the Federal Circuit squarely rejected the notion that the waiver
should be cut off at the commencement of litigation. Echostar, slip op. at 13 & n.4. This
holding comports with district court decisions rejecting the Dunhall line of cases. See Convolve,
Inc. v. Compaq Computer Corp., 224 F.R.D. 98 (S.D.N.Y. 2004); Akeva, supra. In Convolve,

Case 1:04-cv—O1373-KAJ Document 268 Filed 05/O9/2006 Page 3 of 3
The Honorable Kent A. Jordan
May 9, 2006
Page 3
the court stated that limiting discovery until the time of commencement of suit was "particularly
unworkable" and that the only way to evaluate the infringer's state of mind was to review the
infomation the infringer received afterwards. Id The court found that the subject matter waiver
applies until the time the infringer ceases infringing activity. Canvalve, 224 F.R.D. at 104. The
Akeva court went even further, and refused to put any temporal limit on the waiver. Akeva, 243
F.Supp.2d at 423.
Ampex does not ask for "unfettered discretion to rummage through all of
[defendants'] files and pillage all of their litigation strategies." EchoStar, slip op. at 13. Ampex
does not seek core work product, does not seek information outside of the infringement subject
matter addressed by the opinion, and agrees to limit the waiver to materials received, or relating
to communications made, before April 11, 2006, when the '121 patent expired.
Defendants' Refusal t0 Log Trial Counsel Materials
Defendants refuse to provide a privilege log of trial cotmsel materials, apparently
because it would be burdensome to do so. Defendants brought that upon themselves, however,
by relying on an opinion of counsel received more than a year after the commencement of
litigation. Unless defendants produce complete logs, Ampex — and the Court — will have no way
of knowing whether discoverable material even exists and no way of determining whether a
document fairly falls within the scope of the waiver, no matter what that scope is. For the
reasons stated above, Ampex agrees that Kodak would not have to log documents created after
April 11, 2006.
Respectfully,
Jack B. Blumenfeld
Jack B. Blumenfeld (#1014)
JBB/bls
cc: Peter T. Dalleo. Clerk (By Hand)
Paul M. Lukoff, Esquire (By Hand)
Michael J. Summersgill, Esquire (By Fax)
Norman H. Beamer, Esquire (By Fax)