Boisselle, Armand P.

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Case Western Reserve University School of Law

Case Western Reserve Law ReviewVolume 14 | Issue 31963Evidence--Discovery--Corporate Patent Attorney-Client PrivilegeArmand P. BoisselleFollow this and additional works at: https://scholarlycommons.law.case.edu/caselrevPart of the Law CommonsThis Recent Decisions is brought to you for free and open access by the Student Journals at Case Western Reserve University School of Law ScholarlyCommons. It has been accepted for inclusion in Case Western Reserve Law Review by an authorized administrator of Case Western Reserve UniversitySchool of Law Scholarly Commons.Recommended CitationArmand P. Boisselle, Evidence--Discovery--Corporate Patent Attorney-Client Privilege, 14 W. Res. L. Rev. 607 (1963)Available at: https://scholarlycommons.law.case.edu/caselrev/vol14/iss3/331963]Recent DecisionsEVIDENCE - DISCOVERY - CORPORATE PATENTATTORNEY-CLIENT PRIVILEGEAmerican Cyanamid Co. v. Hercules Powder Co.,211 F. Supp. 85 (D. Del. 1962)In American Cyanamid Co. v. Hercules Powder Co.,1 a suit for patentinfringement, both parties moved for the production of certain documentsin accordance with Rule 34 of the Federal Rules of Civil Procedure.The plaintiff sought to obtain documents written by an attorney employedin the defendant's patent department, while Hercules moved to obtaincertain letters written by outside counsel to Cyanamid and documentswritten by members of the plaintiff's patent department. Both partiesobjected to discovery, claiming that the documents were protected by theattorney-client privilege.The court held that the defendants employee was not acting as anattorney when he executed the papers; the correspondence between out-side counsel and Cyanami d did not in any way rest on confidential in-formation;2 and since good cause was shown, the court granted bothmotions.The most significant question raised in the case is whether membersof a corporate patent department are lawyers for the purposes of theattorney-client privilege, or mere businessmen not entitled to that privi-lege.Before answering this question, the court had to determine if acorporation can take advantage of the attorney-client privilege. Whetherto apply the privilege when the client is a corporation has long been aproblem.3 In Radiant Burners, Inc. v. American Gas Ass'n4 the FederalDistrict Court for the Northern District of Illinois recently ruled thatthe attorney-client privilege does not protect information in the files ofa corporation's attorneys. But the Cyanamid court, while concurringthat the application of the privilege to corporations is difficult and prob-lematical, reasoned that full disclosures to attorneys should be encouragedwhether the client is a corporation or an individual5 and held, therefore,1. 211 F. Supp. 85 (D. Del. 1962).2. Plaintiff "apparently conceded" that the opinions rendered by members of its patent de-partment were outside the protection of the attorney-client privilege. Id. at 90.3. Simon, The Attorney-Client Privilege as Applied to Corporations, 65 YAIE LJ. 953(1956).4. 207 F. Supp. 771 (N.D. Ill. 1962).5. "In reality the rule (that the attorney-client privilege does not extend to corporations) ...penalizes the strong and favors the weak, but strength is quite irrelevant to the policy of theprivilege." American Cyanamid Co. v. Hercules Powder Co., 211 F. Supp. 85, 88 n. 12 (D.Del. 1962).WESTERN RESERVE LAW REVIEW [VoL 14:3that the attorney-client privilege can be applied even when the client is acorporation.6The problem of applying the attorney-dient privilege when the at-torneys are members of the legal or patent departments of the corporationclaiming the privilege has been widely discussed in recent years. One ofthe most extensively quoted cases in this area is United States v. UnitedShoe Mach. Corp.7  After listing the general conditions which mustbe present if the privilege is to apply,8 the court held that communicationsand memoranda (which satisfy the given requirements) between acorporation and members of its legal department and between a corpora-tion and outside counsel are protected,9 while the same disclosures tomembers of the corporate patent department are unprotected. The com-plete denial of the privilege to members of the patent department wasbased on the facts that (1) the majority of the members of the depart-ment were not members of the local bar ° and (2) members of patentdepartments spend their time primarily on business matters.In Zenith Radio Corp. v. Radio Corp. of America" the court main-tained that the privilege should not be totally denied to members ofcorporate patent departments, 2 but that the individual documents shouldbe examined to determine whether they contain statements made tothe patent department member acting as a lawyer"a or as a businessman.6. Ibid.7. 89 F. Supp. 357 (D. Mass. 1950).8. "The privilege applies only if (1) the asserted holder of the privilege is or sought to be-come a client; (2) the person to whom the communication was made (a) is a member of thebar of the court, or his subordinate and (b) in connection with this communication is actingas a lawyer; (3) the communication relates to a fact of which the attorney was informed (a)by his client (b) without the presence of strangers (c) for the purpose of securing primarilyeither (i) an opinion of law or (ii) legal services or (iii) assistance in some legal proceeding... and (4) the privilege has been (a) claimed .. . ." Id. at 358-59.9. For a recent discussion of the privilege as applied to corporate legal departments, see Hunt,Corporate Law Department Communications - Privilege and Discovery, 13 VAND. L. REV.287, 307 (1959), where the author concludes: "House counsel's legal papers receive essentiallythe same judicial treatment as outside counsel's file."10. Eight of the persons in the patent department were not members of any bar, and thirteenother persons in the department were not members of the federal or Massachusetts bars butwere members of other judicial bars. United States v. United Shoe Mach. Corp., 89 F. Supp.357, 360 (D. Mass. 1950).11. 121 F. Supp. 792 (D. Del. 1954).12. Id. at 793.13. The court ruled that the attorney-employees of the defendants' patent departments actas lawyers when "they are engaged in applying rules of law to facts known only to themselvesand other employees of their client-companies, and in preparing cases for and prosecuting ap-peals in the Court of Customs and Patent Appeals and other like courts of record. They donot 'act as lawyers' when not primarily engaged in legal activities . . . when drafting or com-paring patent specifications and claims; when preparing the application for letters patent oramendments thereto and prosecuting same in the Patent Office; when handling interferenceproceedings in the Patent Office concerning patent applications." Id. at 794.This arbitrary classification has been criticized. See 23 GEO. WASH. L. REv. 786 (1955).In Ellis-Foster Co. v. Union Carbide & Carbon Corp., 159 F. Supp. 917 (D.N.J. 1958), theCORPORATE PATENT ATTORNEY CLIENT PRIVILEGEIn the former instance, the document is privileged, but in the latter, it isnot.'4In the Cyanamid case the court followed the decision of the Zenithcase since it could not justify extending the privilege to members ofcorporate legal departments while totally denying it to members of cor-porate patent departments. However, this court did not go so far asthe court in the Zenith case in specifying when a member of the patentdepartment acts as a lawyer. 5 The court felt that "each case shouldturn on its own facts."'"Decisions which hold that communications between a corporate clientand its patent department attorneys are automatically excluded from theprivilege are not in keeping with the theory of the privilege.' If theattorney-client privilege is a reasonable one and is necessary "in theinterest and administration of justice,"" one has difficulty visualizing howthe privilege can be totally denied to the corporate clients of attorneyswho happen to be members of the corporate patent department.The decision in the Cyanamid case is significant because the courtrefused to deny the privilege to corporations as recently suggested by asister court.'" It is also significant that the court did not rely on anyset rules to determine when a member of the patent department actedas a lawyer, but decided that each document should be read carefullyto determine if it is to be protected by the attorney-client privilege.ARMAND P. BOISSELLEcourt recognized that correspondence regarding the prosecution of patent applications may infact be legal in nature.14. The court disposed of the bar membership requirement by concluding that "bar member-ship should properly be of the court for the area wherein the services are rendered, but this isnot a sine qua non, e.g., visiting counsel . . . 'house counsel' who practice law only for thecorporate client and its affiliates ... for which local authorities do not insist on admission tothe local bar." Zenith Radio Corp. v. Radio Corp. of America, 121 F. Supp. 792, 794 (D.Del. 1954). Accord, International Minerals & Chems. Corp. v. Golding-Keene Co., 162 F.Supp. 137 (W.D.N.Y. 1958) (privilege of non-disclosure extended to communications be-tween client and a patent agent who is under the immediate supervision of an attorney of a barof any jurisdiction); Georgia-Pacific Plywood Co. v. United States Plywood Corp., 18 F.R.D.463 (S.D.N.Y. 1956).15. See note 13 supra.16. American Cyanamid Co. v. Hercules Powder Co., 211 F. Supp. 85, 89 (D. Del. 1962).17. 8 WIGMORE, EVIDENCE § 2292 (3d ed. 1940).18. Hunt v. Blackburn, 128 U.S. 464, 470 (1888).19. See Radiant Burners, Inc. v. American Gas Ass'n, 207 F. Supp. 771 (N.D. Ill. 1962).19631

Evidence--Discovery--Corporate Patent Attorney-Client Privilege

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Evidence--Discovery--Corporate Patent Attorney-Client Privilege

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