The Software IP Report
Attorney-Client Privilege Granted to Canadian In-House Counsel on U.S. Law
By Peter Keros
06/01/2020
Categories: Attorney-client privilege, The Software IP Report
The District of Kansas held that documents produced by a Canadian attorney working as in-house counsel on U.S. patent infringement matters qualify for attorney-client privilege in a U.S. patent infringement case. Sudenga Indus., Inc. v. Global Industries, Inc., No. 18-2498-DDC (D. Kan. May 15, 2020).
Plaintiff Sudenga Industries sent a cease and desist letter alleging patent infringement to Defendant Global Industries. Defendant is based in Canada, and their General Counsel is licensed in Canada, but not in any U.S. state.
Plaintiff filed a motion to compel documents from Defendant drafted by the Canadian General Counsel regarding the cease and desist letter. Plaintiff argued that the Canadian attorney did not have attorney-client privilege for this U.S. matter. Defendant argued that privilege attached because Canadian privilege would attach in this situation if it involved a Canadian patent and no U.S. case has held that communications from Canadian counsel on U.S. patent matters were not privileged.
Privilege is a matter of common law, so the Court looked to Kansas law. In Kansas, an attorney includes “a person authorized…to practice law in any state or nation, the law of which recognizes a privilege against disclosure of confidential communications between client and attorney” (emphasis added) Canada has attorney-client privilege, similar to the U.S. The in-house attorney is admitted to practice in Alberta and Manitoba and is a member of the Legal Societies (analogous to state bar associations). While Plaintiff argued that U.S. privilege law should apply because the dispute is about U.S. patents and U.S. alleged infringement, the Court noted that Canadian privilege standards were relevant.
The broad definition of “attorney” in Kansas seems to include any country that recognizes attorney-client privilege, such as Canada. Based on this definition, the Court held that communications between the Canadian in-house counsel and Defendant that were “given in a professional legal capacity” were privileged. The Court seemed persuaded by a policy argument presented by the Defendants that requiring non-U.S. companies to immediately hire U.S. counsel to address a cease and desist letter would lead to undue costs and complexity. The Court then ordered Defendant to clarify in the privilege log what documents were “given in a professional legal capacity,” and thus qualified for attorney-client privilege, and other unprivileged business documents.
Lessons for Practice
A while ago, we discussed privilege concerns with patent agents and foreign counsel in one of our monthly webinars, and we noted that most Commonwealth nations have equivalents to attorney-client privilege. In the intervening time, the USPTO has codified patent agent privilege before the PTAB, echoing the Federal Circuit, and even extending privilege to foreign equivalents to U.S. patent agents, such as Canadian patent agents (who do not have privilege under Canadian law), Japanese benrishi (an IP solicitor that is not an attorney at law), and foreign in-house counsel even if they would otherwise not have privilege. It’s also important to note that this relies on Kansas’s specific definition of “attorney” for privilege matters, and it’s not clear whether the rest of the Tenth Circuit or other states will follow suit if this rare situation arises again.