In Shelbyzyme, LLC v. Genzyme Corporation, C.A. No. 09-768-GMS (D. Del. May 22, 2013), Chief Judge Gregory M. Sleet issued an Order granting in part defendant’s request for production of documents under the crime-fraud exception. Defendant alleged that the patent applicants had committed fraud in reviving a patent application because the abandonment and/or delay in revival was intentional, but the applicants had represented to the PTO that the abandonment and delay were unintentional. Id. at 2 n.1.
“Communications that otherwise would be shielded by the attorney-client privilege or the work product doctrine forfeit such protection when they are made in furtherance of a fraud or crime.” Id. The Court concluded that defendant had not established a prima facie case for fraud as to the abandonment because its arguments were speculative. Id. However, defendant had established a prima facie case for fraud as to the delay in revival, in alleging that the applicants “knew at least as early as December 1999 that the Issue Fee had not been paid; [the prosecuting attorney] had received the Notice of Abandonment . . . in January 2000; and [the applicants] knew at least by early 2000 that the [patent application] had been abandoned.” Id. (internal quotation marks omitted). Communications in 1999 between the applicants and other individuals regarding the fact that the application’s Issue Fee had not been paid, and that failure to pay would result in abandonment, “permit the reasonable inference that [the applicants] knew . . . that the [application] had been abandoned.” Id. The Court also concluded that “[g]iven the apparent falsity of the applicants’ representation to the PTO and their demonstrated knowledge that 37 C.F.R. § 1.137(b) required the entire delay to be unintentional, an inference of intent [to deceive] is not only reasonable but effectively required here.” Id. While it would be necessary for defendant to show “clear evidence of deceptive intent,” “there is no reason that ‘clear evidence’ cannot take the form of a well-supported inference.” Id. at 3 n.1. Finally, although the PTO may have been aware that it sent the Notice of Allowance and Notice of Abandonment to the applicants, “it could not independently determine what the applicants themselves knew,” and therefore the alleged misrepresentations to the PTO established reliance and causation. Id.
The Court ordered plaintiff to produce the requested documents only within a limited time period (November 2001 – February 2001) and that related to the revival of the patent application. “Given the narrow basis articulated above for the court’s invocation of the crime-fraud exception,” the Court concluded that the only communications made in furtherance of the fraud were those relating to the revival of the patent application, and not “the otherwise protected communications made leading up to the July 1999 response to Office Action or the October 1999 Issue Fee due date.” Id. at 3 n.2.