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Case 1 :04-cv-01371-JJF Document 31 3 Filed 08/14/2006 Page 1 of 3 Oli O (
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Frederick P. Fish
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August 8, 2006 web site
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Th·e Honorable Joseph J. Farnan, Jr.
United States District Court
for the District of Delaware
844 King Street ~
Wilmington, DE 19801
Re: Fairchild’s waiver of privilege in reliance on opinions of counsel
® Power Integrations, Inc. v. Fairchild Semiconductor International
USDC—D. Del. - C.A. No. 04-1371 JJF
AUSTIN Dear Judge Farnan:
BOSTON Power Integrations submits this letter brief to resolve a dispute regarding the scope of
¤MLM waiver due to Fairchild’s reliance on opinions of counsel. While Fairchild has
DELAWARE produced the opinions themselves and has allowed testimony on the opinions as
Nw YORK dellivered, including four new opinions produced in .July, it is withholding documents
on the same subject matter and has instructed its witnesses not to answer questions
SAN DIEGO which are not limited to the opinions themselves. Power Integrations therefore asks
SIIICOII "IIEI the Court to compel Fairchild to (1) produce additional documents and
wm CITIES cornrnunications relating to the subject matter of its opinions of counsel (both validity
W,SHmGTON_ DC and intringement) and (2) permit unobstructed depositions with respect to these same
subjects.
I. FAIRCHILD WAIVED PRIVILEGE BY RELYING ON THE ADVICE
OF COUNSEL AS A DEFENSE TO A CHARGE OF WILLFUL
INFRINGEMENT
Fairchild waived privilege by producing thirteen (13) opinion letters in this case,l all
of which are addressed to in-house counsel Steve Schott, and twelve of which have
been provided to Robert Conrad, Fairchild Executive Vice President and General
Manager for Analog Products (the group responsibl·e for the accused Fairchild
products). Fairchild does not dispute the fact of waiver. It does, however, seek to use
the privilege as both a sword and a shield, by relying on the fonnal, written opinions
but withholding any other documents or communications that might differ from those
opinions and thus bear on the reasonableness of Fairchild’s reliance on the opinion
letters. The applicable law shows that Fairchild’s actions are improper. In Novartis
Pharmaceuticals Carp. v. Eori Labs Mfg., Iric., 206 F.R.D. 396 (D. Del. 2002), the
Court held that "where, as here, a party relies on the advice of counsel defense to a
l The four most recent Fairchild opinion letters, dated June 6, 2006 and produced to Power
Integrations on July 14, 2006, are attached as exhibits A-D.

Case 1:04-cv-01371-JJF Document 313 Filed 08/14/2006 Page 2 of 3
FISH ez RICHARDSON 1>.c.
The Honorable Joseph J. Faman, Jr.
August 8, 2006
Page 2
charge of willful infringement, the Court concludes that the party has expressly
waived its privilege with respect to attomey-client communications and work product
documentation? Novartis, 206 F.R.D. at 398. VVhen these privileges have been
waived, "everything with respect to the subject matter of counsel’s advice is
discoverable, despite the protection that is normally afforded to attomey-client
communications and work product material." Id. Earlier this year, the Federal
Circuit confirmed that when a party relies on the advice—of-counsel as a defense to
willful infringement, the party waives privilege "with regard to gg attorney—client
communications relating to the same subject matter."’ In re EchoStar Comm. Corp.,
_ 448 F.3d 1294, 1299 (Fed. Cir. May 1, 2006) (emphasis added). Under these cases,
the privilege is waived even with respect to work product communications on the
same subject matters as the opinions. See id. ("[W]hen EchoStar chose to rely on the
advice of in-house counsel, it waived the attomey-client privilege with regard to any
attomey-client communications relating to the same subject matter, including
communications with counsel other than in—house counsel."). As such, Fairchild has
no basis to assert either the attorney-client privilege or work product objections with
respect to documents and communications in its possession regarding infringement
and/or the validity of Power Integrations’ patents-in-suit.
II. FAIRCHILD IMPROPERLY WITHHELD NON-PRIVILEGED
INFORMATION AFTER THE PRIVILEGE WAIVER
Fairchild instructed its witnesses not to answer questions regarding the subject matter
of the opinion letters and continues to withhold other non-privileged information.
The parties staked out their respective positions on the scope of waiver on the record
during the deposition of Robert Conrad (who allegedly relied on the opinions).
Specifically, Fairchild’s lawyers instructed Mr. Conrad not to answer questions
regarding whether the substance of discussions with litigation counsel regarding the
patents-in-suit differed in any way from the opinion letters Fairchild produced in this
case. (Ex. E (Conrad Tr.) at 162-63, 172-73, 179-80, 191.) Fairchild’s counsel
similarly (and improperly) instructed Gary Dolny with respect to questions regarding
his conversations with Fairchild in—house lawyer Steve Schott, allowing Mr. Dolny to
provide testimony only as to conversations regarding a specific opinion letter, rather
than the subject matter of that letter. (Ex. F (Dolny Tr.) at 34-36.)
Although Power Integrations had reiterated its position in the initial pretrial
submissions, Fairchild recently professed ignorance as to the scope of waiver, and
Power Integrations therefore reiterated its position, including providing the relevant
case law on this issue. (Ex. G (Headley ltr. of 7/21/2006).) The parties met and
conferred extensively on this issue, but in the end Fairchild maintains that Power
Integrations is only entitled to ask Mr. Conrad a single question: "Have you received
any other opinions related to the subject matter of the opinion letter, whether
consistent or inconsisten1;." (Ex. H (Feeman ltr of 7/3 1/2006, mid-dated as
7/27/2005).) Fairchild similarly refuses to allow Power Integrations to ask the
recipient of the opinion letters (Steve Schott) any questions regarding the subject

Case 1:04-cv-01371-JJF Document 313 Filed 08/14/2006 Page 3 of 3
Frsu ar RICHARDSON P.C.
The Honorable Joseph J. Farnan, Jr.
August 8, 2006
Page 3
matter of the opinion letters, instead, limiting the questioning of Mr. Schott to
"anything regarding the W ooH\/lorrill 0pinions." These limitations are inconsistent
with this COl1I'I’S rulings and the Federal Circuit’s decision in EchoStar.
In addition, Power Integrations requests the Court to compel Fairchild to produce all
relevant documents previously withheld or otherwise not produced which appear to
embody or discuss a communication to or from Fairchild concerning whether any of
Power Integrations’ patents-in-suit is valid and/or iniiinged by Fairchild. For
example, entry 180 on Fairchild’s supplemental privilege log is labeled as "legal
analysis of competitor’s patents and/or products at direction of attorney," and Mr.
Schott sent it to Fairchild opinion counsel Phil Woo (among others). (Compare Ex. I
(Fairchild Supplemental Privilege Log) with Ex. J (3/9/2004 opinion letter).) Other
entries reflect similar communications with Mr. Schott on these topics, including
entries 45, 175, 184, 209, 213, 310, 312, 316, 319-320, 322, 327, 329, 336, 340, 342,
355, 362, 364, 367-368, 370-371, 375, 383-386, 388, 390, 393, and 417-420. (Ex. I.)
As these documents are clearly directed to the subject matter of the opinion letters
Mr. Schott received (and which Fairchild produced), there is no basis for withholding
them.
Power Integrations theretbre brings this issue to the Court for resolution, as
Fairchild’s recent production of four new opinion letters and its listing of Mr. Schott
as potential trial witnesses require that the depositions of Mr. Conrad, Mr. Schott, and
Mr. Morrill2 go forward.3
Very truly yours,
’ i l' '— /*0 I FI
William J. M .
cc: Clerk of the Court
Steven J. Balick, Esq. (By Hand)
Bas de Blank, Esq. (Via Email)
2 Power Integrations will also proceed with the deposition of Robert Morrill, Fairchild’s
opinion counsel for the later opinion letters, as Fairchild appears to plan to call Mr. Morrill
as a witness at trial.
3 Power Integrations proposed on numerous occasions that these depositions go forward the I
week of September 18 to permit the parties to resolve the issue of the scope of waiver in
advance, as that timing will not disrupt the pretrial conference or trial schedule, see, e. g., Ex.
G, but Fairchild’s insistence that the depositions go forward without a ruling may
necessitate that these depositions be re-convened. However, as Power Integrations has
noted all along, it will not be a problem to review any compelled documents and, if
necessary, take any remaining testimony before trial.