On March 10, 2016, Magistrate Judge Sherry R. Fallon issued a report and recommendation denying plaintiff Intellectual Ventures I LLC’s (“IV”) motion to compel defendant Ricoh Electronics, Inc. (“REI”) to produce certain documents in the possession of Ricoh Company, Ltd. (“RCL”), and to produce 30(b)(6) witnesses to testify regarding certain RCL documents that had been produced. Intellectual Ventures I LLC v. Ricoh Americas Corporation, et al., C.A. No. 13-474-SLR-SRF (D. Del. Mar. 10, 2016) (public version published Mar. 17, 2016). Defendant REI is a U.S. company and wholly owned subsidiary of the other defendant to this action, Ricoh Americas Corp. (“RAC”). RCL is Japanese company that is the parent of RAC, REI, and other Ricoh entities. RCL designs and manufactures the products accused of infringement in this action, and exports them to REI in the U.S., who transfers the accused products to RAC for distribution and sales in the U.S. In September 2014, Judge Robinson dismissed RCL as a party for lack of personal jurisdiction. Following RCL’s dismissal, REI did not provide discovery regarding the design, structure, and operation of the accused products, asserting that those documents were in RCL’s control. REI eventually produced a Technical Assistance Agreement (“TAA”) between RCL and REI, and a number of other RCL documents, but IV still found the production deficient. IV thus moved to compel REI after a motion for issuance of letters rogatory was denied by Japanese authorities. Id. at. 1-2.
Denying IV’s motion to compel document production, Judge Fallon first found that “REI does not have control over the missing documents in RCL’s possession under the terms of the TAA.” Id. at 4. Judge Fallon further explained that “IV . . . failed to establish the existence of an agency relationship between REI and RCL in accordance with Third Circuit precedent.” Id. at 5. Denying the motion to compel the production of a 30(b)(6) witness, Judge Fallon noted that “REI has shown that its ability to prepare witnesses to discuss documents from another corporate entity is substantially limited. Specifically, REI does not design the products, and employees of REI do not have personal knowledge of the technical details set forth in the documents produced by RCL.” Id. at 6. Judge Fallon explained that although “[t]he duty of preparation goes beyond the designee’s personal knowledge and matters in which the designee was personally involved, . . . a corporate subsidiary cannot be expected to acquire all of the knowledge of the parent company and testify on that information in a manner that would effectively result in an end-run around Judge Robinson’s ruling on the motion to dismiss and the denial of the Hague Convention request by the Japanese authorities.” Id.
On May 23, 2016, Judge Robinson concluded that there were no legal errors in Judge Fallon’s analysis and therefore adopted the Report & Recommendation. Intellectual Ventures I LLC v. Ricoh Americas Corporation, et al., C.A. No. 13-474-SLR (D. Del. May 23, 2016). Judge Robinson further explained, however, that “[i]t was not until October 2015 that REI produced [the] Technical Assistance Agreement (“TAA”) between RCL and REI. The TAA was executed in October 2005 and, therefore, was known or should have been known to REI before this litigation commenced (March 2013). The TAA limits the flow of information from RCL to REI in several ways, from the narrow scope of products to the nature of the information provided.” Id. at 2. According to Judge Robinson, pursuant to the TAA, “RCL has agreed to provide only information related to REI’s non-infringement defenses, as opposed to all relevant core technical information.” Id. Judge Robinson continued:
The court understands that litigation in this country is much more intrusive than elsewhere in the world, including Japan. However, the fact remains that the parent company of the defendants has relevant information critical to a fair and just resolution of this patent infringement case, and has erected legal barriers to the production of such information through its subsidiaries, barriers that were known but not disclosed to the court when considering dismissal. It is a defendant’s obligation under this court’s rules to provide all relevant, non-privileged information. The court declines to allow RCL and defendants to use the TAA as both a sword and a shield.
Id. at 3. Judge Robinson thus ordered defendants to show cause as to “why defendants should not be precluded from using any information provided by their parent RCL in their defense.” Id.