Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 1 of 11 PageID #: 45245
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`United States District Court
`EASTERN DISTRICT OF TEXAS
`SHERMAN DIVISION
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`CASE NO. 4:10-CV-435
`consolidated with
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`CASE NO. 4:12-CV-526
`Judge Mazzant
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`OASIS RESEARCH, LLC
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`v.
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`EMC CORP., ET AL
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`MEMORANDUM OPINION AND ORDER
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`Pending before the Court is Motion of Defendants EMC Corporation and Decho
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`Corporation to Amend the Court’s Order Compelling Production of Documents to Certify It for
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`Interlocutory Appeal (Dkt. #987). After reviewing the motion and the relevant pleadings, the
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`Court finds that the motion should be denied.
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`BACKGROUND
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`The action before the Court consists of patent infringement claims and Racketeer
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`Influenced and Corrupt Organizations Act (“RICO”) counterclaims. Plaintiff Oasis Research,
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`LLC (“Oasis”) asserts counterclaims against Defendants, Carbonite, Inc. (“Carbonite”), Decho
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`Corporation, and EMC Corporation (collectively with Decho, Corporation, “EMC”) arising
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`under RICO, 18 U.S.C. § 1961 et seq. (Dkt. #462). Specifically, Oasis contends that Defendants
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`violated 18 U.S.C. § 1962(c) and 18 U.S.C. § 1962(d) (Dkt. #462).
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`In December 2011, counsel for EMC called Chuk Campos (“Campos”), informed him of
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`the litigation, and that Christopher Crawford (“Crawford”) had applied for patents relating to
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`online backup (Dkt. #722, Ex. B, at 443:3-7; Ex. D, at 76:13-77:2). Subsequently, Campos
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`called Don Atwood (“Atwood”) to discuss the calls and litigation (Dkt. #722, Ex. A, at 227:6-10,
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`229:11-23). Both indicated an unwillingness to participate initially, and did not claim at that
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 2 of 11 PageID #: 45246
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`time that they were inventors. (Dkt. #722, Ex. E, PX 41) (Campos stating “if money were not an
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`issue for me right now, the right thing would be to focus our efforts on getting the patent
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`approvals taken away;”; Atwood stating “I agree with you, no patent should have issued,
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`however, it was, so the game becomes who are we more valuable to in this charade.”).
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`Subsequently, Campos and Atwood were again contacted by Defendants to discuss their
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`potential involvement in the litigation. Oasis argues that Defendants threatened, “badgered,” and
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`coerced Campos and Atwood to get involved. Defendants state that they informed Campos and
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`Atwood of the issues in the litigation, and notified them that they could be subpoenaed to testify
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`in the litigation, regardless of whether they cooperated or not. Campos conveyed to Atwood that
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`working with Defendants would be an “opportunity [for them] to make a few bucks.” (Dkt.
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`#722, Ex. A, at 230:23-231:1).
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`Atwood, Campos, and Teri Todd (“Todd”) were subpoenaed to testify during June and
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`July of 2012. A week before these depositions, counsel for Defendants hosted a joint conference
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`call between Atwood, Campos, and counsel for Defendants in which they reviewed the
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`documents and the testimony for the depositions. (Dkt. #722, Ex. D, at 328:19-330:22, 337:2-
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`338:11, 346:2-11; Ex. A, at 250:12-252:16, Ex. B, 649:5-13, 649:19-651:24, 832:25-834:13).
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`Oasis argues that this conference gave the witnesses a preview of each other’s testimony.
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`At Atwood’s deposition, Atwood stated that Defendants offered to pay Atwood, Campos,
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`and Todd $75,000 for their testimony approximately 45 days before their depositions (Dkt. #722,
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`Ex. A, at 232:6-234:9). Oasis argues that Atwood repeatedly testified that this amount was in
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`exchange “for testimony;” however, Defendants note that Atwood later clarified in his deposition
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`that the payment was license for his rights under the patents-in-suit. These individuals declined
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`Defendants’ “initial offer” because it was too low, “just didn’t seem appropriate,” and was not
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 3 of 11 PageID #: 45247
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`reasonable “for what [Defendants] were expecting.” (Dkt. #722, Ex. A, at 233:2-9, 234:5-9; Ex.
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`D, at 381:24-382:13, 383:23-384:6). In a written agreement, dated August 30, 2012, Defendants
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`agreed to pay Campos, Atwood, and Todd $200,000 upfront and an additional $140,000 once the
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`litigation was completed, plus expenses and legal fees (Dkt. #722, Ex. C, PX 517). At trial, the
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`three witnesses indicated that they were required by their agreement to come to trial and testify
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`that they were co-inventors.
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`Oasis alleges that “the Defense Group pursued a scheme of offering and providing
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`improper inducements to fact witnesses Atwood, Campos, and Todd in exchange for fact
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`testimony and production of ‘evidence’ that the Defense Group believed would help prove its
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`allegations” (Dkt. #462). On January 29, 2013, Defendants filed their motion for summary
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`judgment on RICO counterclaims (Dkt. #595). On April 15, 2013, Plaintiff filed its response
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`(Dkt. #722). On April 25, 2013, Defendants filed their reply (Dkt. #723). On May 6, 2013,
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`Plaintiff filed its sur-reply (Dkt. #731). On February 5, 2015, the Court denied Defendants’
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`motion for summary judgment finding “that there is a fact issue as to whether there is a pattern of
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`activity sufficient to amount to or post a threat of continued criminal activity.” (Dkt. #749 at p.
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`7).
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`On May 22, 2015, Plaintiff wrote Defendants requesting the production of documents
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`relating to Defendants’ co-inventorship claims, and the payments allegedly made or offered in
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`connection with Plaintiff’s RICO allegations (Dkt. #823 at p. 3). Specifically, Oasis requested:
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`All documents related to any payment or offer of payment to, or for the benefit of,
`Charles Campos, Don Atwood, Teri Todd, and/or their counsel, including
`communications internal to EMC/Carbonite as well as communications between
`any members of the joint Defense Group.
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`All communications relating to Charles Campos, Don Atwood, Teri Todd, Donald
`Doss, Jack Byrd, Robert Lynch, and/or any of their attorney/agents, including
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 4 of 11 PageID #: 45248
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`communications internal to EMC/Carbonite as well as communications between
`any members of the joint Defense Group.
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`All communications relating to the inventorship of the Patents-in-Suit, including
`any communications internal to EMC/Carbonite as well as communications
`between any members of the joint Defense Group.
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`All documents related to any potential causes of action against Oasis,
`[Christopher] Crawford, and/or Intellectual Venture including communications
`internal to Carbonite/EMC as well as communications between any members of
`the joint Defense Group.
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`Defendants joint defense agreement in this case and all documents related to any
`party joining or withdrawing from the joint defense group.
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`(Dkt. #823 at pp. 3-4). Defendants refused to produce the documents asserting attorney-client
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`privilege, common interest privilege, and the work product doctrine. Plaintiff alleged that the
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`documents should be produced under the crime-fraud exception of the attorney-client privilege.
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`On June 23, 2015, Plaintiff filed its Motion to Compel Defendants to Produce Documents
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`Related to Alleged Co-Inventors Under the Crime-Fraud Exception to the Attorney-Client
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`Privilege and to Compel Production of Defendants’ Joint Defense Agreement (Dkt. #823). On
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`June 30, 2015, Defendants filed their responses (Dkt. #838; Dkt. #840). On July 2, 2015,
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`Plaintiff filed its reply (Dkt. #843). On July 6, 2015, Defendants filed their sur-replies (Dkt.
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`#856; Dkt. #858). On July 13, 2015, EMC filed their Unopposed Motion to Allow for
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`Supplemental Briefing on Plaintiff’s Motion to Compel (Dkt. #870; Dkt. #871). The Court
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`granted EMC’s motion on July 14, 2015 (Dkt. #880). On July 17, 2015, Plaintiff filed its
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`response to EMC’s supplemental briefing (Dkt. #888). On July 22, 2015, the Court granted in
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`part and denied in part Plaintiff’s Motion to Compel Defendants to Produce Documents Related
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`to Alleged Co-Inventors Under the Crime-Fraud Exception to the Attorney-Client Privilege and
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`to Compel Production of Defendants’ Joint Defense Agreement (Dkt. #898). The Court required
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`Defendants to produce the Joint Defense Agreement to Plaintiff at that time, and required
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 5 of 11 PageID #: 45249
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`Defendants to produce for in camera inspection documents related to the RICO allegations (See
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`Dkt. #898). However, the Court found that the documents related to potential causes of action
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`against Oasis, Crawford, and/or Intellectual Ventures were privileged, as those communications
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`were not relevant to Plaintiff’s RICO counterclaims (See Dkt. #898).
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`On July 24, 2015, the Court held a telephone conference with the parties to clarify its
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`Order. On July 28, 2015, EMC filed notice with Court that it complied with the Court’s Order,
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`and produced the Joint Defense Agreement to Plaintiff (Dkt. #922). On August 11, 2015, EMC
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`filed notice with the Court that it complied with the Court’s Order, and produced the relevant
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`documents for in camera review by the Court (Dkt. #936).
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`On August 28, 2015, after reviewing the in camera submissions, the Court ordered that
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`EMC produce 357 documents to Plaintiff, as they met the criteria under the crime-fraud
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`exception of the attorney-client privilege, by September 4, 2015 (Dkt. #968). On September 3,
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`2015, the Court received a letter from EMC’s counsel informing the Court that they did not agree
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`with the Court’s ruling, and intended to seek appellate review of the Court’s Order (Dkt. #989,
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`Exhibit E).
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`On September 4, 2015, EMC filed the instant motion arguing that the Court’s Order
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`compelling the production of documents should be certified to the Federal Circuit for
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`interlocutory appeal (Dkt. #987). Specifically, EMC asserts that the Court should submit the
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`following questions to the Federal Circuit:
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`(a) [W]hether the crime-fraud exception to the attorney-client privilege may be
`invoked on the basis of a patent Assignment Agreement, in light of the
`Federal Circuit’s express recognition that such agreements are “very
`common” and do not demonstrate that a party has paid for witnesses’
`testimony (See Dkt. #840 at p. 9) (quoting Ethicon, Inc. v. U.S. Surgical
`Corp., 135 F.3d 1456, 1459 (Fed. Cir. 1998)); and
`(b) [W]hether the common-place investigatory steps undertaken here by EMC
`(including interviewing witnesses, asking them documents, and informing
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 6 of 11 PageID #: 45250
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`them that they can be subpoenaed) support the application of the crime-fraud
`exception to attorney-client privilege?
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`(Dkt. #987 at pp. 1-2). On September 8, 2015, Plaintiff filed its response (Dkt. #989). On
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`September 9, 2015, EMC filed their reply (Dkt. #993).
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`Under 28 U.S.C. § 1292(b), the Court may certify its order compelling document
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`ANALYSIS
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`production for interlocutory appeal if it determines “that such order involves a controlling
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`question of law as to which there is substantial ground for difference of opinion and that an
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`immediate appeal from the order may materially advance the ultimate termination of the
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`litigation[.]” EMC alleges that they have met this standard, and the Court should certify its
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`Order.
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`As stated above, an order is appropriate for certification if (1) it involves a controlling
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`question of law, (2) as to which there is substantial ground for difference of opinion, and (3) an
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`immediate appeal may materially advance the ultimate termination of the litigation. 28 U.S.C. §
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`1292(b); Litton Sys., Inc. v. Raytheon Co., 979 F.2d 215, 1992 WL 276681, at *2 (Fed. Cir. Aug.
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`4, 1992). Interlocutory appeals under 28 U.S.C. § 1292(b) “are rarely granted.” Nystrom v.
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`TREX Co., Inc., 339 F.3d 1347, 1351 (Fed. Cir. 2003); Jang v. Bos. Sci. Corp., 767 F.3d 1334,
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`1339 (Fed. Cir. 2014). (“[O]ur court grants interlocutory review in [] multi-faceted patent cases
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`only rarely.”). “Both the legislative history of Section 1292(b) and the case law emphasize that
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`appellate courts should only grant interlocutory appeals under rare circumstances.” Fujitsu Ltd.
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`v. Tellabs Inc., 539 F. App’x 1005, 1006 (Fed. Cir 2013); see also Clark-Dietz & Assocs. –
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`Eng’rs, Inc. v. Basic Constr. Co., 702 F.2d 67, 69 (5th Cir. 1983) (“Section 1292(b) appeals are
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`exceptional.”). “Satisfying these three statutory criteria is not always sufficient, ‘as district court
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 7 of 11 PageID #: 45251
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`judges have unfettered discretion to deny certification even when all three are satisfied.”
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`Commil USA, LLC v. Cisco Sys., Inc., No. 2:07-cv-341, 2011 WL 738871, at *4 (E.D. Tex. Feb.
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`23, 2011) (internal citation omitted), judgment vacated on other grounds by Commil USA, LLC v.
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`Cisco Sys., Inc., 135 S.Ct. 1920 (May 26, 2015).
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`Plaintiff first argues that EMC’s motion is untimely because it was filed months after the
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`Court’s original decision to apply the crime-fraud exception was entered (Dkt. #989 at p. 8).
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`While there is no statutory deadline for the filing of the request for certification, there is a
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`nonstatutory requirement that the request for certification “be filed in the district within a
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`reasonable time after the order sought to be appealed.” Ahrenholz v. Bd. of Tr. of Univ. of Ill.,
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`219 F.3d 674, 675-76 (7th Cir. 2000) (citing Richardson Elecs., Ltd. v. Panache Broad. of Pa.,
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`Inc., 202 F.3d 957, 958 (7th Cir. 2000) (emphasis in original)). Without good reason for delay,
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`“a district judge should not grant an inexcusably dilatory request” for interlocutory certification.
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`Richardson Elecs., Ltd., 202 F.3d at 958 (holding that “delay alone was sufficient grounds for us
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`to refuse our permission to appeal” because “no excuse for the defendants’ taking two months to
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`appeal has been offered except the patently inadequate one that the case had been ‘largely
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`dormant’ for nine years, requiring the defendant’s lawyer to refamiliarize himself with it…”).
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`Other courts that have considered this issue have found a delay of two months or more to be
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`untimely. See Weir v. Propst, 915 F.2d 283, 287 (7th Cir. 1990); Ferraro v. Sec’y of HHS, 780
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`F. Supp. 978 (E.D.N.Y. 1992) (denying motion to certify as untimely after plaintiff’s two-and-
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`one-half-month delay); Green v. City of New York, No. 05-CV-0429, 2006 WL 3335051, at *2
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`(E.D.N.Y. Oct. 23, 2006) (denying motion for certification of interlocutory appeal where no
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`justification was offered for two-month delay); Fabricant v. Sears Roebuck & Co., No. 98-1281-
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`Civ, 2001 WL 883303 (S.D. Fla. Jan. 26, 2001) (denying motion to certify as untimely after
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`forty-six day delay). EMC first informed the Court that they would not comply with the Court’s
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`Order, and of their intent to seek appellate review on September 3, 2015, one day before their
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`production deadline. EMC has offered no explanation or justification for their delay.
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`Additionally, EMC was well-aware that the RICO trial was scheduled to begin on October 26,
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`2015, seven weeks after they filed their motion. Therefore, the Court finds that the motion is
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`untimely.
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`Additionally, the Court finds that the elements for certification of interlocutory appeal are
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`not met here. First, the Court’s order compelling production of documents under the crime-fraud
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`exception to attorney-client privilege does not raise a controlling question of law. An order may
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`only be certified for interlocutory appeal under § 1292(b) if it turns on “a pure issue of law, i.e., a
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`question the appellate court can efficiently rule on without making an intensive inquiry into the
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`record.” Software Rights Archive, LLC v. Google, Inc., No. 2:07-CV-511, 2009 WL 1797996, at
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`*2 (E.D. Tex. June 24, 2009) (citations omitted); see also IP Innovation LLC v. Google Inc., No.
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`2:07-CV-503-RRR, 2010 WL 691130 (E.D. Tex. Jan. 6, 2010) (Rader, J. sitting by designation)
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`(denying certification because the question was not a “pure issue of law”). “1292(b) appeals
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`were intended, and should be reserved, for situations in which the court of appeals can rule on a
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`pure, controlling question of law without having to delve beyond the surface of the record in
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`order to determine the facts.” McFarlin v. Conseco Servs., LLC, 381 F.3d 1251, 1259 (11th Cir.
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`2004). EMC contends that there are two controlling issues of law: whether the crime-fraud
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`exception may be invoked (1) on the basis of a patent Assignment Agreement or (2) on the basis
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`of common-place investigatory steps (Dkt. #987 at pp. 1-2). The Court agrees with Plaintiff that
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`neither of those questions is “controlling,” or an issue of pure law. “[A] question of law is
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`‘controlling’ within the meaning of Section 1292(b) only if [the] resolution of that issue could
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 9 of 11 PageID #: 45253
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`have an immediate impact on the course of the litigation.” Fujitsu, 539 F. App’x at 1007. In its
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`in camera review, the Court did not rely on any particular action or any singular act to justify its
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`application of the crime-fraud exception, but rather the totality of Defendants’ actions, the
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`alleged co-inventor testimony, and the record evidence before the Court. Therefore, even if the
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`appellate court were to conclude that the particular actions identified in isolation by Defendants
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`do not justify the application of the crime-fraud exception, it would not change the Court’s
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`conclusion because the Court did not view the evidence in isolation, but rather in totality of
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`Defendants’ actions. Therefore, the Court finds that EMC’s questions do not present an issue of
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`controlling law.
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`Additionally, even if EMC’s questions were controlling, they are not pure issues of law.
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`Rather, EMC’s interlocutory review involves the Court’s fact-specific evaluation of the patent
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`Assignment Agreement, and any of a number of EMC, and other Joint Defense Group, actions to
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`purportedly induce the alleged co-inventors to come forward and testify in support of
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`Defendants’ inventorship defense. See, e.g., Mae v. Hurst, No. 14-60864, 2015 WL 3463001, at
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`*3 (5th Cir. June 2, 2015) (affirming the district court’s refusal to certify an interlocutory appeal
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`since “[a]ppelants’ argument amount[ed] to a fact-specific dispute over the application of the
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`discovery rules”). Those are not issues of “pure law,” but would require an appellate court to
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`make a fact-intensive inquiry into a large evidentiary record, which is not the purpose of
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`interlocutory review. The Court finds that any difference of opinion as to the importance of
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`EMC’s predicate acts would require an intensive analysis of the underlying facts of the RICO
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`allegations; and therefore, do not present an issue of pure law.
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`Finally, an immediate appeal will not “materially advance the ultimate termination of the
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`litigation.” 28 U.S.C. § 1292(b). The RICO trial is set to begin in seven weeks on October 26,
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`Case 4:10-cv-00435-ALM Document 999 Filed 09/11/15 Page 10 of 11 PageID #: 45254
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`2015, and EMC now asks the Court to certify fact-intensive questions for interlocutory review.
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`The resolution of those questions would not advance the ultimate termination of Oasis’ RICO
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`claims. In its motion for a stay, EMC argues that even if it were successful in its order regarding
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`the Court-ordered production, Oasis’ claims would still go forward, and “Oasis has the
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`information it needs to litigate the case.” (See Dkt. #986 at p. 8). Therefore, the Court finds that
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`an appeal of the Court’s discovery order would not advance the ultimate termination of the
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`litigation.
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`EMC cites Mohawk Indus. v. Carpenter, 558 U.S. 100 (2009), for the proposition that
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`interlocutory review is appropriate in this case. However, the Court agrees with Plaintiff that
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`Mohawk does not support that proposition. In Mohawk, the Supreme Court confirmed that there
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`was no collateral appellate review of a district court’s application of the crime-fraud exception.
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`558 U.S. at 105, 114. Although the Supreme Court stated that interlocutory review was among
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`several possible remedies for reviewing a novel issue of law decided by a trial court, it also
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`stated that “[m]ost district court ruling on [matters of privilege] involve the routine application of
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`settled legal principles [and] are unlikely to be reversed on appeal, particularly when they rest on
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`factual determinations for which appellate deference is the norm.” Mohawk Indus., 558 U.S. at
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`110. Although EMC argues that “Oasis’ underlying RICO allegations, and its resulting theory
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`under the crime-fraud exception, are novel, and have huge ramifications, because they call into
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`question whether ordinary litigation activities, and common types of agreements, can vitiate the
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`attorney-client privilege[,]” they have not presented evidence demonstrating that the Court’s
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`application of the crime-fraud exception presents a novel question of law (Dkt. #987 at p. 2).1
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`Therefore, the Court finds that interlocutory review is not appropriate in this case.2
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`1 EMC seems to be arguing about whether the RICO allegations that Plaintiff has asserted against Defendants can
`stand. EMC cites Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456, 1459 (Fed. Cir. 1998), as its source for why
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`CONCLUSION
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`It is therefore ORDERED that Motion of Defendants EMC Corporation and Decho
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`Corporation to Amend the Court’s Order Compelling Production of Document to Certify It for
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`Interlocutory Appeal (Dkt. #987) is hereby DENIED.
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`the Court should certify its questions to the Federal Circuit. However, Ethicon does not pertain to the crime-fraud
`exception of the attorney-client privilege. The Court finds that EMC is attempting to appeal the ultimate issue of the
`RICO case—whether Defendants’ conduct was permissible or fraudulent. That is not the purpose of a limited
`interlocutory appeal.
`2 In Mohawk Industries, the Supreme Court stated that “appellate courts can remedy improper disclosure of
`privileged material in the same way they remedy a host of other erroneous evidentiary rulings: by vacating an
`adverse judgment and remanding for a new trial in which the protect material and its fruits are excluded from the
`evidence.” 558 U.S. at 109. Because the Court’s disclosure order does not deal with a novel issue of law, the Court
`finds that the appellate court could remedy an improper disclosure of privilege material, if any, upon review of the
`final judgment.
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