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Important safety tip: Filing under seal is not the same as filing in camera.

By Michael C. Smith

First American CoreLogic, Inc. v. Fiserv, Inc., et. al. , 2:10cv00132 (E.D. Tex. December 2, 2010)

Judge: T. John Ward

Holding: Motion for Protective Order / Motion to Reclaim Privileged Documents DENIED

Closely behind Shakespeare in providing useful one-liners for the English language is the 1983 movie Ghostbusters.   My favorite comes from this exchange during the movie's climax.

Dr. Egon Spengler: There's something very important I forgot to tell you.
Dr. Peter Venkman: What?
Dr. Egon Spengler: Don't cross the streams.
Dr. Peter Venkman: Why?
Dr. Egon Spengler: It would be bad.
Dr. Peter Venkman: I'm fuzzy on the whole good/bad thing. What do you mean, "bad"?
Dr. Egon Spengler: Try to imagine all life as you know it stopping instantaneously and every molecule in your body exploding at the speed of light.
Dr Ray Stantz: Total protonic reversal.
Dr. Peter Venkman: Right. That's bad. Okay. All right. Important safety tip. Thanks, Egon.

So for those of us fuzzy on the whole under seal / in camera thing, here's an important safety tip for practitioners. 

In this patent infringement case Plaintiff CoreLogic filed a motion for protective order asking the Court to prevent the defendants from communicating with two of its former employees.  In CoreLogic's motion for protective order, however, when attempting to bolster its argument that its former employees were privy to privileged communications at CoreLogic, CoreLogic attached as exhibits to its motion a declaration and six emails to illustrate a sample of the privileged communications of which Walker and/or Chen had participated.  (You can see where this is going, can't you?)  But CoreLogic did not submit the exhibits in camera; instead, CoreLogic attached the exhibits under seal, and served a copy of the privileged emails and declaration to every defendant in the present lawsuit.  (Yeah, I know - it hurts to type this too).  Further, nowhere in CoreLogic's motion for protective order did it state or indicate that it intended to file the exhibits for in camera review or for the ?Court's eyes only.?

As you might expect, one of the defendants in its response pointed out that CoreLogic had waived its privilege to those documents by attaching them as exhibits and serving them on the parties.  CoreLogic then claimed that it meant to file the exhibits in camera, and filed the motion to reclaim.  Judge Ward held that CoreLogic had waived its attorney-client and/or work product protection with respect to the seven documents it disclosed to Defendants by attaching the documents under seal as exhibits to its motion for protective order and serving the documents on all parties. But he did not find a subject-matter waiver, thus CoreLogic had only waived its attorney-client privilege for the seven privileged documents it produced.  Judge Ward noted the important distinction between filing under seal and filing in camera:

Filing under seal is not the same as filing in camera. Filing under seal protects the documents from view of the public. On the other hand, filing documents in camera protects the documents from view of the public and also other parties in the case?only the Court can view the documents. Therefore, filing the documents under seal and serving them on the defendants has the same effect as disclosing documents to a third party and thus waiving the privilege.

The real analysis, however, was whether the disclosure was inadvertent, and here Judge Ward analyzed the new Federal Rule of Evidence 502 (which Judge Ward noted " is new and neither the parties nor the Court has identified any binding authority in this Circuit or District that specifically interprets Rule 502(b) as applicable to this case. Further, few appellate courts, if any, have had a chance to interpret the rule") and the prior Fifth Circuit caselaw on this point, and concluded that the disclosure could not be characterized as "inadvertent".

In this Court?s view, the unique facts of the present case are not what Congress or the Advisory Committee had in mind when drafting Rule 502(b). Rule 502(b) and the previous five factor test outlined above were designed primarily to cope with the increasingly common problem in massive discovery where thousands or millions of documents are produced and a few privileged documents are ?inadvertently? disclosed along with the millions of other documents. This case, however, does not involve the inadvertent disclosure of documents along with millions of other documents. Instead, Corelogic filed the privileged exhibits and declaration under seal and then served them on all the defendants. Hence, Defendant LPS, in essence, argues that CoreLogic advertently disclosed the documents to the defendants and thus waived its privilege.

Judge Ward went on to state that "Under the facts of this case, the Court is not willing to set a precedent allowing an exhibit to be considered as filed in camera when the party first filed the exhibit under seal (and served the other parties with the documents), and then later merely filed an affidavit claiming the exhibit was supposed to be in camera" but significantly noted that that the situation might have been different if the motion had claimed that the documents were being filed in camera, then accidentally filed them under seal and served them.

Judge Ward then ordered the parties to meet and confer for the purpose of determining an adequate solution to protect CoreLogic's privileged information while still allowing LPS to discover factual, non-privileged information from its employees Walker and Chen. Interestingly, he added that "the Court has observed from the briefing that there has been some dispute regarding what is required to satisfy the ?Meet and Confer? requirement in good faith. Before meeting and conferring as the Court has ordered above, the attorneys for the parties are ordered to read Local Court Rule CV-7(h)" and "[t]he parties ... are ordered to meet and confer for the purpose of determining an adequate solution to protect CoreLogic?s privileged information while still allowing LPS to discover factual, non-privileged information from its employees Walker and Chen. Further, the Court has observed from the briefing that there has been some dispute regarding what is required to satisfy the ?Meet and Confer? requirement in good faith. Before meeting and conferring as the Court has ordered above, the attorneys for the parties are ordered to read Local Court Rule CV-7(h)" and "[p]articularly, the parties should pay attention to the portion that states ?[i]n any discovery-related motion, the substantive component requires, at a minimum, a personal conference, by telephone or in person, between the lead trial counsel and any local counsel for the movant and the lead trial counsel and any local counsel for the non-movant.? Local Court Rule CV-7(h)" (emphasis added by Judge Ward).

Full post as published by Eastern District of Texas Federal Court Practice on December 07, 2010 (boomark / email).