Opinion
Civ. No. 04-5108 (HAA).
November 9, 2005
E. Evans Wohlforth, Jr., Esq., Gibbons, Del Deo, Dolan, Griffinger Vecchione, P.C., Newark, New Jersey, Attorneys for Plaintiff Intelli-Check, Inc. and Non-Parties Kevin J. McKenna, Vincent E. McGeary and Gibbons, Del Deo, Dolan, Griffinger Vecchione, P.C. pro se.
Anthony J. Laura, Esq., Reed Smith LLP, Newark, New Jersey. Attorneys for Defendants,
OPINION ORDER
This case comes before the Court on a motion filed by Kevin J. McKenna, Vincent E. McGeary and Gibbons, Del Deo, Dolan, Griffinger Vecchione, P.C., pro se, to quash certain deposition subpoenas served upon them by Defendant Tricom Card Technologies, Inc. ("Tricom"). For the reasons detailed below, the motion to quash is GRANTED.
Factual Background
This matter is an offshoot of patent litigation pending in the United States District Court for the Eastern District of New York, captioned Intelli-Check, Inc. v. Tricom Card Technologies, Inc., Civ. No. 03-3706 (the "Eastern District Action"). Defendant Tricom commenced this matter by issuing third-party deposition subpoenas to two individual attorneys, Vincent E. McGeary, Esq., and Kevin J. McKenna, Esq., and their law firm, Gibbons, Del Deo, Dolan, Griffinger Vecchione, P.C. (the "Gibbons firm"), all of whom represent plaintiff Intelli-Check in the Eastern District Action. The individual attorneys and the Gibbons firm (collectively, the "Gibbons Deponents") have moved to quash the deposition subpoenas.
The underlying Eastern District Action concerns allegations by Intelli-Check that Defendants Tricom, Mark Baughman and Stephen Stone (the "Tricom Defendants") have infringed two United States Patents belonging to Intelli-Check: Patent Nos. 6,463,416 B1 ("the '416 Patent") and 6,523,741 B1 ("the '741 Patent"). The Tricom Defendants contest the allegations of infringement and raise various defenses, including the recently-alleged defense of commission of inequitable conduct in connection with the '741 Patent. In essence, Tricom's "inequitable conduct" defense and counterclaim, which has only recently been included in a formal pleading in August 2005, asserts that the '741 Patent is unenforceable because Intelli-Check's attorneys violated their duty of candor to the United States Patent and Trademark Office ("PTO") by failing to disclose relevant prior art at the time the '741 Patent was pending.
The Tricom Defendants issued deposition subpoenas to the Gibbons Deponents in September 2004, on the eve of the close of discovery in the Eastern District Action. The subpoenas were served only four days before the discovery period ended, affording less than four days for compliance.
The Gibbons Deponents moved to quash the subpoenas, asserting that: 1) the subpoenas were technically deficient; 2) they were issued for harassment and tactical advantage rather than for legitimate discovery purposes; and 3) the subpoenas were not relevant to any claim or defense then pleaded in the litigation. Significantly, at the time the subpoenas issued, the "inequitable conduct" defense had not been included in any formal pleading, though Tricom had received court permission to amend its pleading to include such a defense months before.
It was not until August 1, 2005 that Tricom amended its Answer to include such a defense.
The Gibbons Deponents emphasize that, to the extent that Tricom has sought these depositions in furtherance of its claim that Intelli-Check and its attorneys committed "inequitable conduct" in the application for the '741 Patent, Tricom has failed to seek deposition of the person most logically implicated by this claim — Richard M. Lehrer, Esq., the former Gibbons firm attorney who prosecuted the '741 Patent. The Gibbons Deponents have filed with their reply papers Lehrer's sworn declaration that he was the sole attorney from the Gibbons firm who had any "substantive involvement" in the '741 Patent. Significantly, Lehrer is no longer associated with the Gibbons firm.
In opposition to the motion to quash, Tricom asserts that the subpoenas' procedural deficiencies are curable. Moreover, Tricom asserts that McGeary and McKenna were "associated with" the application process for the '741 Patent, as allegedly evidenced by entries in a privilege log prepared by the Gibbons firm. Tricom argues that McGeary and McKenna are subject to the inequitable conduct standard, and because they allegedly failed to disclose relevant information to the PTO, their omission constitutes "inequitable conduct" in the application for a patent, rendering the '741 patent unenforceable. Finally, Tricom asserts that it was not too late for Tricom to revise its pleadings to include an "inequitable conduct" defense, a position that obviously is confirmed by the later filing of Tricom's amended pleading containing the "inequitable conduct" defenses and counterclaim.
Analysis
The Gibbons Deponents' motion to quash is governed by Federal Rules of Civil Procedure 26(c) and 45(c). Rule 26(c) provides, in relevant part, that "for good cause shown, . . . the court in the district where the deposition is to be taken may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression or undue burden or expense." Rule 45(c) permits a court to quash or modify a subpoena if it "subjects a person to an undue burden." Fed.R.Civ.P. 45 (c)(3)(A)(iv). "There is no general prohibition against obtaining the deposition of adverse counsel regarding relevant, non-privileged information." Johnston Dev. Group, Inc. v. Carpenters Local Union No. 1578, 130 F.R.D 348, 352 (D.N.J. 1990). The Gibbons Deponents, as the parties seeking the protective order to preclude their depositions, bear the burden under Rule 26(c) of demonstrating good cause to preclude the testimony. Cipollone v. Liggett Group, Inc., 785 F.2d 1108, 1121 (3d Cir. 1986).
The preclusion of attorney depositions is to be analyzed under the same standards as any other protective order motion, with the movant bearing the burden of persuasion under Rule 26(c). The request for preclusion must be weighed by balancing "the necessity for such discovery in the circumstances of the case against its potential to oppress the adverse party and burden the adversary process itself." Johnston Dev., 130 F.RD. at 352. The Johnston Development court explained the requirements for securing a motion to quash or modify the subpoena of an attorney:
The party seeking to block its attorney's deposition concerning relevant information will succeed if it establishes undue burden or oppression measured by (1) the relative quality of information in the attorney's knowledge, that is, whether the deposition would be disproportional to the discovering party's needs; (2) the availability of the information from other sources that are less intrusive into the adversarial process; and (3) the harm to the party's representational rights of its attorney if called upon to give deposition testimony.
First, any discovery must pass the proportionality test of Rule 26(b)(1). It must concern relevant information which is within the inquiring party's legitimate discovery needs when assessed against the lawsuit's "nature and complexity, the importance of the issues at stake in a case seeking damages, . . . and the significance of the substantive issues. . . ." The deposition of an adverse attorney on central factual issues, rather than peripheral concerns, would weigh more heavily for the proportionality of the discovery sought[.]
Second, availability from other sources, and its corollary concern of avoiding cumulative or duplicative discovery, are also factors favoring limitation of discovery under Rule 26(b)(1)(I). A recollection of an event witnessed by fifty other persons would be readily obtainable from many others, and the attorney's testimony would likely be duplicative; the attorney's conversation with one or two other persons, however, gives rise to a more unique perspective.
Third, the prospect of oppression is ever present in the examination of adverse counsel. Various courts have seemingly given this factor controlling weight, making the unexamined assumption that oppressive motivations are at work in the party seeking the discovery. For example, the Shelton court believed that the "harassing practice of deposing opposing counsel (unless that counsel's testimony is crucial and unique) appears to be an adversary trial tactic that does nothing for the administration of justice but rather prolongs and increases the costs of litigation, demeans the profession, and constitutes an abuse of the discovery process," [ Shelton v. American Motors Corp., 805 F.2d 1323, 1330 (8th Cir. 1986)]. . . . The graver concern is that an attorney's deposition will deflect the attorney's efforts in case preparation on behalf of the client and inject an unproductive dynamic into the litigation, perhaps poisoning the necessary chemistry between professionals. The court is well-advised to assess this risk if the deposition is otherwise justified, for the discovery may extract a dear price from the healthy adversary process upon which our system places heavy reliance.Id. at 353 (citations omitted).
With respect to the first prong of the Johnston Development test, regarding the proportional relevance and importance of the testimony sought, Tricom's opposition papers assert that the depositions of McGeary and McKenna are necessary because "the intent of the person committing the inequitable conduct is an element of the defense, and thus is always at issue." (Defs.' Br. in Opp'n to Mot. to Quash Subpoenas ("Defs.' Br.") 1.) If Tricom is correct that McGeary and McKenna validly can be implicated in an inequitable conduct defense, their testimony will be both relevant and central to that issue.
The inequitable conduct defense arises from the duty of candor that patent applicants owe to the PTO regarding information material to the patentability of the invention in question. Federal regulations codify the duty, and describe the persons to whom the duty extends. See 37 C.F.R. § 1.56(a) (1992) ("Each individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the [PTO], which includes a duty to disclose to the [PTO] all information known to that individual to be material to patentability."). The regulations define "individuals associated with the filing or prosecution of a patent application" as (1) each inventor named in the application; (2) each attorney or agent who prepares or prosecutes the application; and (3) every other person who is substantively involved in the preparation or prosecution of the application and who is associated with the inventor, with the assignee or with anyone to whom there is an obligation to assign the application. 37 CFR § 1.56(c) (1992) (emphasis supplied). The regulations further state that persons other than the inventor, the attorney, or the agent may comply with the duty of candor by "disclosing information to the attorney, agent or inventor." 37 C.F.R. § 1.56(d) (1992).
Tricom asserts that McGeary and McKenna are subject to the duty of candor because these individuals "have knowledge of the prosecution of the '741 patent application, and accordingly, the standard for inequitable conduct extends to them." (Defs.' Br. 3.) This glib assertion is a misstatement of the law that glosses over the fact that neither McGeary nor McKenna fall within the defined classes of persons recognized by federal regulations to have a duty of candor to the PTO. Tricom has not disputed the fact that neither McGeary nor McKenna were attorneys who "prepare[d] or prosecute[d]" the '741 Patent application. The file wrapper of the patent, which had been provided to Tricom in discovery prior to the issuance of the subpoenas, identifies Lehrer as the prosecuting attorney. (2d Certif. of E. Evans Wohlforth, Ex. C at 2.) Moreover, the Gibbons Deponents have offered Lehrer's sworn declaration that "neither Kevin J. McKenna nor Vincent E. McGeary had any substantive involvement with the '741 Patent." (See Decl. of Richard M. Lehrer ("Lehrer Decl.") ¶¶ 2, 5.)
Tricom has attempted to support its assertion that "Messrs. McGeary and McKenna were involved in the prosecution of the application of the '741 patent" with citations to correspondence referenced in a privilege log provided by the Gibbons firm in response to discovery requests. (Defs.' Br. 3.) Tricom asserts that McGeary and McKenna were involved in prior litigation on behalf of Intelli-Check against a company called Identiscan, and as a result of this litigation, Intelli-Check purchased the assets of Identiscan, including Identiscan's then-pending pending application for the '741 Patent. Tricom claims that the privilege log provided in the instant litigation "indicates that Mr. McGeary was involved in the assignment of the Identiscan patents to Intelli-Check, presumably including the assignment of the 741 patent application." ( Id.) Upon review, the cited privilege log entry states "Correspondence with attorney re: IntelliCheck assignments." (Certif. of Gregory M. Murphy, Ex. A at 2.) This entry is wholly unenlightening as to McGeary's role, if any, in the assignment of the '741 Patent. But even if this entry were conclusive proof that McGeary was responsible for the assignment of the patents, this Court agrees with the Gibbons Deponents that assigning a patent application is not substantive involvement in prosecuting the application sufficient to impose a duty of candor under 37 C.F.R. § 1.56.
Tricom also attempts to bolster its claim that McGeary was involved in the '741 Patent application by asserting that the privilege log indicates that "Mr. McGeary received a U.S. Patent Office communication regarding the application for the '741 patent. Receipt of this Patent Office communication concerning the examination of the '741 patent application clearly `associated' Mr. McGeary with the prosecution of the application for the '741 patent." (Defs.' Br. 3.) Again, Tricom seeks to prove too much with its citation to unenlightening references in the privilege log. The actual privilege log entry indicates that McGeary received correspondence from one Mr. Volpe (the private practitioner whose firm previously handled the prosecution of the '741 Patent before it was assigned to Intelli-Check) and not the PTO (Lehrer Decl. ¶ 4). As noted by the Gibbons Deponents, any "communication to McGeary from the PTO would be reflected in the file wrapper, which defendants do not cite." (Pl.'s Reply Br. in Supp. of Mot. to Quash Subpoenas 11.) Tricom's recourse to the privilege log thus proves wholly unpersuasive.
In sum, Tricom has failed to muster any evidence to indicate that McGeary or McKenna were in any way "substantively involved" in the preparation or prosecution of the '741 Patent. The Gibbons Deponents' submissions could not be clearer: it is undisputed that the file wrapper for the '741 Patent indicates that the prosecuting attorney is Richard Lehrer. In turn, Lehrer's sworn declaration confirms that McGeary and McKenna had no substantive involvement in the patent application.
Because Tricom has failed to show that McGeary and McKenna were "substantively involved" in the '741 Patent application, Tricom cannot demonstrate that McGeary and McKenna were bound by a duty of candor to the PTO in connection with the '741 Patent application. Thus their alleged nondisclosure of relevant prior art cannot give rise to an inequitable conduct charge, and there is no valid basis for exploring McGeary's or McKenna's "intent" or "mental impressions" in a deposition in furtherance of this flawed "inequitable conduct" defense. See Schreiber Foods, Inc. v. Beatrice Cheese, Inc., 92 F. Supp. 2d 857, 882 (E.D. Wis. 2000) ("Even if defendants establish that plaintiff's high-level executives had material information and intentionally concealed it, such evidence is irrelevant to the inequitable conduct charge if the executives (1) were not substantively involved in the preparation or prosecution of the application, and (2) did not disseminate the information to members of the applicant group.") (emphasis added); see also Johnston Dev., 130 F.R.D. at 353 n. 2 ("Naturally, if the anticipated scope of the attorney's deposition does not concern relevant issues, no deposition may be taken under Rule 26(b)(1).") Accordingly, the deposition subpoenas issued to McGeary and McKenna must be quashed as irrelevant.
Tricom also issued a deposition subpoena directed to the Gibbons firm, which is also subject to the motion to quash. Tricom's counsel has made no reference to this subpoena in the opposition to the motion to quash, and the Gibbons firm has requested that the motion to quash be considered unopposed with respect to the Gibbons firm subpoena. This Court agrees, in light of this Court's decision to quash the individual subpoenas and in view of the Gibbons firm's representation that it has complied with the document requests contained in the subpoenas. Accordingly, the subpoena directed to the Gibbons firm is also quashed.
Even if the lack of relevance of the McGeary and McKenna subpoenas were not readily apparent, this Court would grant the motion to quash due to the suspect nature of Tricom's subpoenas, evidenced by Tricom's questionable failure to seek the deposition of Lehrer, the prosecuting attorney for the '741 patent. The second prong of the Johnston Development test requires an examination of whether the information sought in the deposition of adverse counsel may be secured from other sources, less disruptive to the adversarial process. Johnston Dev., 130 F.R.D. at 353. Lehrer is no longer associated with the Gibbons firm, and is not involved in the Eastern District Action. Lehrer's deposition is the obvious first step in fleshing out a claim of "inequitable conduct" in the '741 Patent application, due to Lehrer's role as the patent prosecutor. His deposition could have been subpoenaed without fear of disruption of plaintiff's trial preparations, and without raising the specter of disqualification of Intelli-Check's trial counsel inherent in Tricom's effort to depose McGeary and McKenna. However, for some undisclosed reason, Tricom has declined to seek Lehrer's deposition.
The defense of inequitable conduct is frequently invoked in patent infringement cases, and is likewise frequently abused. FMC v. Manitowoc Co., 835 F.2d 1411, 1415 (Fed. Cir. 1987) (stating that "[I]nequitable conduct is not, or should not be, a magic incantation to be asserted against every patentee."); Preemption Devices, Inc. v. Minn. Mining Mfg. Co., 732 F.2d 903, 908 (Fed. Cir. 1984) (commenting that fraud on patent office defense is a "much-abused and too often last-resort allegation"). Courts are cognizant of the potential for abuse inherent in the assertion of the inequitable conduct defense, in particular as a precursor to a motion to disqualify plaintiff's trial counsel:
The Federal Circuit's concern over the use of the inequitable conduct defense is justifiable, given the many dangers inherent in such a defense. . . . [I]f the attorneys representing the party accused of inequitable conduct are the same attorneys who represented the client in the patent prosecution, then the party asserting inequitable conduct will often move to disqualify those attorneys. Specious allegations of inequitable conduct can thus be deployed as a delaying tactic, as an attempt to confuse the issues or mislead the court, or as a tool to generate more fees or make the case more expensive for an opponent to try or settle.Chiron Corp. v. Abbot Labs, 156 F.R.D. 219, 221 (N.D. Cal. 1994) (emphasis added); see also Sun Microsystems, Inc. v. Dataram Corp., Civ. No. 96-20708, 1997 U.S. Dist. LEXIS 4557, at *12-13, 1997 WL 50272, at *4 (N.D. Cal. Feb. 4, 1997) (recognizing "delay, confusion, attorney disqualification, and wasted resources" as the "inherent dangers of such a defense" and requiring specificity of pleading to weed out frivolous claims of inequitable conduct) (emphasis added).
This Court is mindful of the potential for frivolous invocation of an inequitable conduct defense as grounds for seeking oppressive and harassing depositions of adverse counsel. The circumstances surrounding the issuance of the disputed subpoenas suggest that such motives are at work with respect to Tricom's subpoenas of McGeary and McKenna. This Court finds it extremely incongruous, if not downright suspicious, that Tricom has advanced an inequitable conduct defense premised on the actions of Intelli-Check and its patent attorneys, without pursuing the deposition of the prosecuting patent attorney, a person whose testimony would be crucial to such a defense. Lehrer may no longer be associated with Intelli-Check or the Gibbons firm, but as a third-party witness, he is as subject to subpoena power as are his former colleagues McGeary and McKenna. The only difference that this Court can perceive is that Lehrer's deposition would not offer Tricom the same opportunity for harassment, disruption and risk of attorney disqualification as would depositions of Intelli-Check's active counsel, McGeary and McKenna.
Moreover, the regulations concerning the duty of candor to the PTO suggest that Lehrer, as a conduit for information to the PTO, should have been a key witness, inasmuch as the regulations provide that persons (such as McGeary and McKenna) other than the prosecuting attorney, the patent agent, or the inventor may comply with the duty of candor by "disclosing information to the attorney, agent or inventor." 37 CFR § 1.56(d).
In sum, after being sued for patent infringement by McGeary and McKenna on behalf of Intelli-Check, Tricom waited until the close of discovery in this case to issue subpoenas to those very attorneys, ignoring the primary significance of Lehrer's role in any inequitable conduct claim. It does not require a great stretch of imagination for this Court to infer that Tricom's true purpose in seeking the depositions of McGeary and McKenna is an effort to lay the groundwork for their eventual disqualification as trial counsel, rather than for any legitimate discovery purpose. This Court will not indulge Tricom in such improper and oppressive use of the subpoena power in the absence of a showing of the proposed depositions' relevance to a viable claim or defense in the Eastern District Action.
Conclusion
For the aforementioned reasons it is hereby ORDERED on this 9th day of November 2005 that the Gibbons Deponents' Motion to Quash Subpoenas issued by Tricom is GRANTED. The deposition subpoenas served upon Vincent E. McGeary, Kevin J. McKenna, and the law firm of Gibbons, Del Deo, Dolan, Griffinger Vecchione, P.C., are hereby quashed.