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Judge Sleet denies motion for reconsideration of order to produce documents under crime-fraud exception

In Shelbyzyme, LLC v. Genzyme Corporation, C.A. No. 09-768-GMS, Chief Judge Gregory M. Sleet had previously granted in part defendant’s request for the production of plaintiff’s privileged documents under the crime fraud exception, as detailed here. Here the Court considered plaintiff’s motion for reconsideration, and denied it. Slip op. at 1 (D. Del. June 25, 2013).

Plaintiff argued that “the court erred in drawing the inference that patent applicant knew of the abandonment [of a relevant application] by December 1999 and thus was mistaken in its subsequent finding on the ‘intent to deceive’ prong” of fraud. Id. at 3. Plaintiff argued that the Court’s finding was “predicated upon a misreading of” an email from a licensee to the related patent family to defendant, in which the licensee had explained that the application in question would become abandoned if the applicant did not pay a base issue fee. Id. at 5 n.3 (quoting the email in full). The plaintiff “now claims that [the prosecuting attorney and patent counsel] was the source of the information that the issue fee had not been paid.” Id. at 6. However, “the court continues to believe that the most reasonable interpretation of [this] email is that [the applicant] was the source of [the licensee’s] knowledge that the issue fee had not been paid and that [the licensee] conveyed that knowledge to [defendant]. A close examination of the message supports this view,” and, quoting passages from the email, the Court mapped out how the prosecuting attorney’s statement that the fee had not been paid was “conditional” and indicated that he was “unaware as to whether [the applicant] actually had paid the fee.” Id. The Court also noted that “the alternative interpretations presented in [plaintiff’s] Motion for Reconsideration suffer from serious flaws.” Id. at 7.

Plaintiff also “reference[d] a June 2, 2013 declaration [of the prosecuting attorney] in support of its position that [the attorney] was the source of [the licensee’s] knowledge that the issue fee had not been paid.” Id. at 9. The Court disregarded this declaration, explaining that “a motion for reconsideration should not be used ‘as a means to argue new facts or issues that inexcusably were not presented to the court in the matter previously decided.’ Here, [plaintiff] failed to present an equivalent to this . . . declaration in support of its initial [letter brief], making consideration of the above-quoted statement improper.” Id. at 10 (quoting Brambles USA v. Blocker, 735 F. Supp. 1239, 1240 (D. Del. 1990)). “The remaining evidence offered by [plaintiff] to challenge the court’s reading of the [email],” including testimony from various parties regarding this email and the source of information as to whether the issue fee had been paid, “[was] unpersuasive,” as it “[told] the court little about the actual source of [the] information.” Id.

Finally, plaintiff “[took] issue with the court’s characterization of a declaration attached to the Petition for Revival, which the court referenced in its discussion of the ‘reliance’ element” of fraud. Id. at 3. “While the court recognizes that its prior characterization of the [this declaration] may have oversimplified matters, conflating [the declarant’s] own knowledge with that of the applicants, it does not believe that any error resulted in its conclusion as to the reliance issue” because its prior characterization was “not required to reach [its] conclusion” that the PTO had reasonably relied on the alleged misrepresentations in the Petition for Revival. Id. at 13.

Shelbyzyme, LLC v. Genzyme Corporation, C.A. No. 09-768-GMS (D. Del. June 25, 2013)

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