- ALJ Essex Denies Respondents’ Motion to Compel Privileged Documents in Certain Optoelectronic Devices for Fiber Optic Communications (337-TA-860)
- July 2, 2013 | Authors: Eric W. Schweibenz; Thomas C. Yebernetsky
- Law Firm: Oblon, Spivak, McClelland, Maier & Neustadt, L.L.P. - Alexandria Office
On June 12, 2013, ALJ Theodore R. Essex issued the public version of Order No. 12 (dated April 17, 2013) in Certain Optoelectronic Devices for Fiber Optic Communications, Components Thereof, and Products Containing Same (Inv. No. 337-TA-860).
According to the Order, Respondents filed a joint motion to compel Complainants Avago Technologies General IP (Singapore) Pte. Ltd. and Avago Technologies U.S. Inc. (collectively, “Avago”) to produce all communications involving non-party Agilent Technologies, Inc. (“Agilent”) that have been withheld from production on the basis of attorney-client privilege. The documents at issue all relate to the patents-at-issue, but were created while the asserted patents were owned by Agilent. Respondents argued that the decision in Certain Hardware Logic Emulation Systems and Components Thereof, Inv. No. 337-TA-383, Order No. 25 (April 17, 1996) (“Hardware Logic Emulation Systems”) dictates that the transfer of documents from Agilent to Avago waived the attorney-client privilege. According to Respondents, Hardware Logic Emulation Systems held that transferring a part of a corporation was insufficient to transfer attorney-client privilege if the part of the corporation transferred was merely a group of assets. Therefore, Respondents argued that attorney-client privilege was waived because Avago only conducted an asset purchase from Agilent.
In opposition, Avago argued that Hardware Logic Emulation Systems no longer represents the standard for determining when attorney-client privilege transfers with an asset purchase. Instead, Avago asserted that the “practical consequences” test is the proper standard. Avago stated that the “practical consequences” test turns on the “practical consequences rather than the formalities of the particular transaction.” Under this test, Avago argued that the sale of Agilent’s Semiconductor Products Group preserved the attorney-client privilege because the sale was for an entire ongoing line of business.
ALJ Essex held that attorney-client privilege transferred with the sale of the Semiconductor Products Group from Agilent to Avago. Based upon the Asset Purchase Agreement and a declaration submitted by Avago’s in-house counsel, ALJ Essex determined that Avago’s asset purchase satisfied the “practical consequences” test because Avago purchased, and continued operating, Agilent’s entire Semiconductor Products Group. Accordingly, ALJ Essex denied Respondents’ motion to compel.