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Computer Associates International, Inc. v. Simple.com

September 25, 2007

COMPUTER ASSOCIATES INTERNATIONAL, INC. PLAINTIFF,
v.
SIMPLE.COM, INC., WIRED SOLUTIONS, LLC., A REVOKED NEVADA LLC, DEFENDANTS.



The opinion of the court was delivered by: Hurley, Senior District Judge

MEMORANDUM & ORDER

Presently before the Court is the motion of Plaintiff CA, Inc. ("CA" or "Plaintiff") for (1) a protective order staying discovery on willful infringement pending the disposition of CA's motion for summary judgment of non-infringement and (2) bifurcation of the trial on liability from the trial on damages and willful infringement and bifurcations of and a stay of further discovery on willful infringement. Both forms of relief are opposed by Defendants Simple.com, Inc. and Wired Solutions, LLC (collectively "Simple" or "Defendants"). For the reasons set forth below, the both motions are denied.

Background

CA "is a provider of software solutions and services for the management of information technology infrastructure, business information, and application development." (3d Amended Complaint ¶ 2.) Defendants are the current owners of three patents: U.S. Patent Nos. 6,272,493 ("493"), 6,434,563 ("563"), and 6,535,882 ("882"). In its complaint, as amended, CA seeks a declaratory judgment that the three patents are invalid, unenforceable, and "not infringed" by Plaintiff's products. (See id. ¶ 34.) Simple has counterclaimed against CA for willful infringement. (Amended Answer and Counterclaims ¶¶ 11-25 and Prayer for Relief ¶ 5.)

On September 1, 2004, CA notified Simple that it elected to invoke the advice of counsel defense to rebut the accusation of willful infringement. CA produced two opinions of Cooper & Dunham, LLP relating solely to the validity of the patents in suit. The first opinion is dated September 5, 2003 and relates to the '493 patent. The second opinion is dated March 3, 2004 and relates to the '882 and '563 patents.

CA has produced documents in response to Simple's document request for "[a]ll attorney's opinions upon which you intend to rely in asserting any defense against a claim of willful infringement in this case and all documents related to any such opinion." However, CA did not produce any communications between it and its Litigation Counsel claiming attorney-client privilege. Simple then moved before the Special Master for an order to compel.

By Order dated November 24, 2004 (the "Discovery Order"), the Special Master granted the motion, rejecting CA's claims that it did not waive the attorney-client privilege as to Litigation Counsel. (Special Master's Discovery Order at p. 23.) Further, the Special Master rejected CA's proposed temporal limitation limiting the waiver of privilege vis-a-vis trial counsel to the period prior to the commencement of the suit. (Id. at pp. 23-24.) Nonetheless, in order to protect litigation or trial strategy, the Special Master provided that any materials concerning the subject matter of the Cooper & Dunham opinions that also relate to trial or litigation strategy should be submitted for in camera review.

CA filed objections to the Special Master's Discovery Order. By Order dated October 26, 2006, this Court upheld the Special Master's Discovery Order and granted Defendants' motion to compel. Thereafter CA filed a petition for a writ of mandamus with the Federal Circuit asking that Court to vacate this Court's October 26, 2006 Order. On January 29, 2007, the Federal Circuit ordered that CA's petition be held in abeyance pending resolution of an earlier petition filed in another case entitled In re Seagate Technology, LLC. On August 20, 2007, the Federal Circuit issued a decision in Seagate, --- F.3d ---, 2007 WL 2358677 (Aug. 20, 2007) and held that, in general, relying on an opinion counsel's work product does not waive work product immunity with respect to trial counsel. On September 17, 2007, the Federal Circuit granted CA's petition for a writ of mandamus, vacated this Court's October 23, 2006 decision and remanded for this Court to reconsider its discovery order in view of Seagate.

While CA's objections to the Special Master's Discovery Order were pending before this Court, the Special Master issued, inter alia, a Report and Recommendation on CA's motion for summary judgment on infringement in which he concluded that CA has not infringed any of the claims of the patents at issue (the "Infringement R&R"). Objections to the Infringement R&R (as well as other of the Report and Recommendations issued by the Special Master with respect to the motions for summary judgment) have been filed and are currently pending before this Court.

While its petition for a writ of mandamus was pending, CA made the instant motion to stay discovery related to the issue of willful infringement, more specifically discovery regarding CA's opinion of counsel defense, pending the Court's ruling on the Special Master's Infringement R&R. In addition, CA seeks to bifurcate discovery and trial of willfulness and damages from liability.

Discussion

I. The Motion to Bifurcate

In its motion CA seeks bifurcation of the liability trial from the trial of willfulness and damages and bifurcation and stay of further discovery on willful infringement. According to CA the motion should be granted because it will promote judicial efficiency and avoid jury confusion. Simple opposes the motion on the grounds that there is overlap in evidence between liability on the one hand and damages and willfulness on the other hand. Thus, Simple contends using ...


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