It's Crabbering time!!
Long slumbering, but always alert, the Mavexar saga moved step closer to its inevitable conclusion today when Chief Judge Connolly issued a memorandum order in Swirlate IP LLC v. Quantela, Inc., C.A. No. 22-235-CFC (D. Del. Aug. 29, 2024) (Mem. Order).
This order dealt with a pair of cases that have largely flown under the radar, being stayed during the pendency of the Nimitz appeals. But the story here is similar in the broad strokes to that in Backertop and Nimitz. The putative plaintiff is an LLC with a sole owner who was assigned the patent in suit by IP Edge or Mavaxar. The attorneys in the case largely communicated through Mavexar. Following a hearing on the issue, Judge Connolly order Swirlate to produce documents to help determine if Swirlate's counsel had complied with their ethical duties to represent Swirlate. The order specifically permitted Swirlate to file the documents under seal or for in camera review if they were privileged.
Apparently, the documents submitted under seal were nevertheless redacted to some extent. The production was accompanied by a letter explaining that "Documents that contain attorney-client privilege and/or work product are therefore being withheld or redacted to remove attorney-client privilege and/or work product, and all withheld or redacted documents will be identified on the concurrently submitted privilege log."
This Order was the Court's response to that production. To begin, Judge Connolly noted that disclosure to the Court could not constitute a "waiver" of the privelege:
It is axiomatic that the compelled disclosure of privileged material by a court does not constitute a waiver of the privilege. And so, when I first read Swirlate's letter-especially in light of Swirlate's express request for leave to submit privileged materials under seal and my granting of that request-I was concerned that Swirlate and Mr. Bennett were simply flouting the February Document Production Order. But it also occurred to me that perhaps Mr. Bennett believed that Swirlate could avoid waiving the attorney-client privilege and/or work product immunity for produced documents only if it produced those documents in response to another compulsion order issued after Swirlate had asserted the privilege and work product immunity with respect to those specific documents.
Id. at 23 (internal citations omitted).
Accordingly, the Court went on to order the production of unredacted copies of these documents and set a hearing for September 18, 2024 "to address its concerns that counsel for Swirlate may have failed to comply with the Rules of Professional Conduct; that real parties in interest, such as IP Edge and Mavexar, may have been hidden from the Court and the defendants; and that Swirlate, its counsel, and those real parties in interest may have perpetrated a fraud on the Court." Id. at 26.
Mark your calendars folks, it should be a fun one.
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