I’ve already posted briefly on Echostar, the Federal Circuit’s May 1 order granting a mandamus petition that sought to narrow a trial court’s decision about the scope of a privilege waiver. Patently O also discusses the case, as does Patent Prospector.

Giving the case another close read, which a friendly comment prompted me to do, shows me there’s more about which to comment. If you’re interested in willfulness doctrine and the advice of counsel defense, you can read more about it below the fold.

In this case, after TiVo sued Echostar for patent infringement, Echostar obtained additional legal advice about its exposure from outside counsel Merchant & Gould. (Up to that point, Echostar had relied on the opinion of in-house counsel.) The trial court held that Echostar, by relying on the advice of its in-house counsel in defending against TiVo’s allegation of willful infringement, had waived its attorney-client privilege and work product immunity as to all materials from Merchant & Gould (including materials Merchant & Gould had never given to Echostar). Echostar produced communications from Merchant & Gould, but both it and the law firm continued to resist the surrender of things not communicated to Echostar.

The Federal Circuit acknowledges, in deciding the matter, that the trial courts have been taking varied approaches to the scope of one’s waiver … including whether it extends to materials not communicated to the client. Before balancing the need to prevent the distortions of selective waiver against the need to shield a lawyer’s mental impressions and private opinions from public view, the Federal Circuit separates the materials in question into “at least three categories” (and acknowledges, in footnote 3, there may be more):

They include: (1) documents that embody a communication between the attorney and client concerning the subject matter of the case, such as a traditional opinion letter; (2) documents analyzing the law, facts, trial strategy, and so forth that reflect the attorney’s mental impressions but were not given to the client; and (3) documents that discuss a communication between attorney and client concerning the subject matter of the case but are not themselves communications to or from the client.

The court concludes, quite comfortably, that Category 1 documents must be produced after the waiver, and that Category 2 documents need not be produced even after the waiver. As the court cautions, “[b]y asserting the advice-of-counsel defense to a charge of willful infringement, the accused infringer and his or her attorney do not give their opponent unfettered discretion to rummage through all of their files and pillage all of their litigation strategies.” My earlier post focused on the court’s conclusion as to Category 2.

Category 3 documents, however, present a more complex problem. On the one hand, such documents aren’t communications to the client and thus are similar to Category 2 materials. On the other hand, Category 3 materials could convey helpful contextual information about the communications revealed in the Category 1 materials. The court concludes that the latter characteristic predominates, observing that Category 3 materials “will aid the parties in determining what communications were made to the client and protect against intentional or unintentional withholding of attorney-client communications from the court.”

This decision about uncommunicated materials that reference attorney-client communications will doubtless present some knotty problems for lawyers providing opinion letters about patent infringement or validity issues. We all know that e-mail communications, especially within one’s company or group, can get rather loose in tone. When mixed with references to communications with the client, these e-mails are facially within Category 3. (Indeed, the court uses, as an example, a lawyer’s “e-mail to his associate referencing a phone call with the client.”) At the same time, the court itself cautions in favor of redacting as needed to protect the lawyers’ mental impressions: “Still, we must emphasize that such communications may contain work product of the second kind–legal analysis that was not communicated. In those situations, the parties should take special care to redact such information, and if necessary the district court may review such material in camera.”

I think the document review process in patent litigation just got a bit more expensive and hazardous …