Plaintiff Global Tubing, LLC (“Global”) filed a motion to compel production of documents withheld as privileged by Defendant Tenaris Coiled Tubes, LLC (“Tenaris”). As explained by the district court, in its motion to compel, Global claimed that Tenaris obtained its patents by deceiving the Patent and Trademark Office (“PTO”), withholding prior art in prosecuting the main patent, and then altering and withholding a key piece of the prior art. Global contended that Tenaris’ actions withholding the material from the PTO amounted to fraud, vitiating any attorney-client privilege under the crime-fraud exception. Global sought to compel documents withheld as privilege that were in the possession of the prosecution counsel relating to the prior art materials and those relating to inventorship of the three patents at issue. Global also sought to compel production of an affidavit submitted in support of the patent that Tenaris clawed back asserting that the privilege, if any, was waived and the affidavit contained direct evidence of Tenaris’ fraud on the PTO, vitiating any privilege under the crime-fraud exception to the attorney-client privilege.
In support of the motion to compel the affidavit, Global presented evidence of Tenaris’ knowledge of the prior art materials, the inventors’ review and discussion of those materials and the overlapping specifications with the patent-in-suit. As explained further by the district court, Global also showed that Tenaris tendered the materials to prosecuting counsel, and counsel reorganized the material, removing the title page, divider pages, and entire specifications section, which purportedly contained information on overlapping chemistries, particularly significant in light of the PTO’s previous rejection of the patent based on obviousness that included overlapping chemistries.
The district court found this evidence sufficient to merit an in camera review of the affidavit. After that review, the district court determined that the affidavit. which contained a statement questioning whether it is a good idea to disclose the prior art material, “is a rare example of direct evidence of an intent to defraud. See Therasense, Inc., 649 F.3d at 1290 (direct evidence of deceptive intent is rare, allowing courts to infer intent from circumstantial evidence); GFI, Inc. v. Franklin Corp., 265 F.3d 1268, 1274 (Fed. Cir. 2001) (‘facts in inequitable conduct cases rarely include direct evidence of admitted deceitful conduct’). Not only is it evidence of intent to commit fraud, but it is also not a privileged communication because communications regarding future fraudulent conduct are not protected. Zolin, 491 U.S. at 562-63.”
Accordingly, the district court granted the motion to compel the affidavit and all documents relating to the prior art that were withheld under a claim of privilege.
Global Tubing, LLC v. Tenaris Coiled Tubes, LLC, Case No. 4:17-CV-3299 (S.D. Tex. March 26, 2021)
The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. For more information about this case, contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.