Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 1 of 8
`
`
`
`
`
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`EUREKA DIVISION
`
`NEONODE SMARTPHONE LLC,
`
`Plaintiff,
`
`v.
`
`APPLE INC,
`
`
`
`Defendant.
`
`
`
`Case No. 21-cv-08872-EMC (RMI)
`
`
`ORDER RE: DISCOVERY DISPUTE
`LETTER BRIEF
`
`Re: Dkt. No. 90
`
`Now pending before the court is a discovery dispute letter brief (dkt. 90) in a patent
`
`
`
`
`
`
`
`
`
`infringement suit.1 Plaintiff, Neonode Smartphone LLC (“Neonode”), owns two patents pertaining
`
`to user interfaces for certain types of mobile handheld devices. See Compl. (dkt. 2) at 1. Neonode
`
`has accused Defendant Apple, Inc. (“Apple”) of infringing those patents – both directly and
`
`indirectly – under a number of theories. See id. at 12-41. Neonode (a Wyoming limited liability
`
`company) initially filed its suit in the Western District of Texas because of the notion that Apple
`
`maintains a branch office in that district. Id. at 3. Near the outset of the litigation, Apple moved to
`
`transfer venue to this district. See Def.’s Mot. (dkt. 27) at 5-6. Shortly after the district court in
`
`Texas denied Apple’s motion to transfer venue to this district (see dkt. 65), the Parties stipulated
`
`to stay various aspects of this case, “with the exception of any work related to discovery in
`
`Sweden.” See Stip. (dkt. 66) at 1. Thereafter, following a ruling by the Court of Appeals for the
`
`Federal Circuit, the case was transferred to this district after all (see dkts. 75, 76).
`
`
`
`More recently, on April 12, 2021, Neonode informed Apple that a Swedish court has
`
`
`1 Pursuant to Federal Rule of Civil Procedure 78(b) and Civil Local Rule 7-1(b), the Court finds the matter
`suitable for disposition without oral argument.
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 2 of 8
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`scheduled in-person depositions in Sweden for Magnus Goertz and Thomas Eriksson on May 11
`
`and May 13, 2022. See Ltr. Br. (dkt. 90) at 1. Magnus Goertz is the named inventor of both of
`
`Neonode’s patents at issue in this suit (the ’879 and ‘993 patents). See Compl. (dkt. 1) at 3.
`
`Thomas Eriksson is the CEO of Neonode Technologies AB and Neonode, Inc. See id. at 7. Mr.
`
`Goertz is not represented by Neononode’s counsel and he is not a party to this litigation; Mr.
`
`Eriksson, also a non-party, has been retained by Neonode as a consultant, “and his consultancy
`
`[reportedly] encompasses his expert opinion regarding matters at issue in this litigation.” See Ltr.
`
`Br. (dkt. 90) at 1, 4 n.2. In advance of these Swedish depositions, in order to both prepare for the
`
`depositions and to effectively cross-examine these two witnesses, Apple hastily requested
`
`production of (1) all documents that Neonode or its counsel has obtained from Messrs. Goertz and
`
`Eriksson; (2) all communications between Neonode or its counsel and Messrs. Goertz and
`
`Eriksson; and (3) all documents Neonode intends to use in the course of the Swedish depositions.
`
`Id. at 1. Neonode objects on five grounds (see id. at 3-7), and for the reasons outlined below,
`
`Neonode’s objections are overruled and Apple’s request to compel the production in question is
`
`granted.
`
`
`
`Before proceeding to Neonode’s arguments, the court will note several generally-
`
`applicable principles related to discovery in federal civil litigation. Under Federal Rule of Civil
`
`Procedure 26(b), “[p]arties may obtain discovery regarding any nonprivileged matter that is
`
`relevant to any party’s claim or defense — including the existence, description, nature, custody,
`
`condition, and location of any documents or other tangible things and the identity and location of
`
`persons who know of any discoverable matter.” Additionally, with a showing of good cause, “the
`
`court may order discovery of any matter relevant to the subject matter involved in the action.” Id.
`
`“The requirement of relevancy should be construed liberally and with common sense, rather than
`
`in terms of narrow legalisms.” Miller v. Pancucci, 141 F.R.D. 292, 296 (C.D. Cal. 1992).
`
`Furthermore, “the deposition-discovery rules are to be accorded a broad and liberal treatment.”
`
`See Hickman v. Taylor, 329 U.S. 495, 507 (1947). The Hickman Court explained that a policy
`
`favoring liberal discovery facilitates proper litigation (see id.), and this policy is evidenced by
`
`Rule 26(b)(1)’s allowance for discovery of any matter, not privileged, that is relevant to the claim
`
`2
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 3 of 8
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`or defense of any party. Relevant information need not even be admissible at the trial and would
`
`still be subject to discovery so long as the discovery demand appears reasonably calculated to lead
`
`to the discovery of admissible evidence – in which regard, district courts have broad discretion in
`
`resolving whether the information sought is relevant for discovery purposes. See Surfvivor Media,
`
`Inc. v. Survivor Prods., 406 F.3d 625, 635 (9th Cir. 2005).
`
`
`
`The attorney-client privilege excepts from discovery any communications concerning legal
`
`advice sought from an attorney in his or her capacity as a professional legal advisor, where the
`
`communication is made in confidence, is intended to be maintained in confidence by the client,
`
`and is not disclosed to a third party. See United States v. Sanmina Corp., 968 F.3d 1107, 1116 (9th
`
`Cir. 2020). The privilege extends to a client’s confidential disclosures to an attorney in order to
`
`obtain legal advice, as well as an attorney’s advice in response to such disclosures. United States
`
`v. Ruehle, 583 F.3d 600, 607 (9th Cir. 2009) (citations and quotations omitted). “Because it
`
`impedes full and free discovery of the truth, the attorney-client privilege is strictly construed.” Id.
`
`On the other hand, the work product doctrine protects from discovery materials that are prepared
`
`by, or for, a party or its representative in anticipation of litigation. Fed. R. Civ. P. 26(b)(3). Unlike
`
`privileges, the work product doctrine provides only a limited and qualified protection against the
`
`discovery of trial preparation materials that “reveal an attorney’s strategy, intended lines of proof,
`
`evaluation of strengths and weaknesses, and inferences drawn from interviews.” See Hickman, 329
`
`U.S. at 511. Its purpose is to prevent attorneys from obtaining an unfair advantage “on wits
`
`borrowed from the adversary.” Id. at 516 (Jackson, J., concurring); see also Upjohn Co. v. United
`
`States, 449 U.S. 383, 390-91 (1981). A voluntary disclosure of work product waives the protection
`
`where such disclosure is made to an adversary in litigation or where the disclosure is made in a
`
`manner that substantially increases the opportunities for potential adversaries to obtain the work
`
`product. Sanmina Corp., 968 F.3d at 1121. The party asserting attorney-client privilege or work
`
`product protection bears the burden of proving that the privilege or protection applies. See Ruehle,
`
`583 F.3d at 607-08; see also In re Appl. of Republic of Ecuador, 280 F.R.D. 506, 514 (N.D. Cal.
`
`2012).
`
`
`
`Unlike the attorney-client privilege, the work product privilege is governed, even in
`
`3
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 4 of 8
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`diversity cases, by a uniform federal standard embodied in Fed. R. Civ. P. 26(b)(3), which
`
`essentially codifies the rule of Hickman. See United Coal Cos. v. Powell Const. Co., 839 F.2d 958,
`
`966 (3d Cir. 1988); see also PepsiCo, Inc. v. Baird, Kurtz & Dobson LLP, 305 F.3d 813, 817 (8th
`
`Cir. 2002) (similar); Baker v. General Motors Corp., 209 F.3d 1051, 1053 (8th Cir. 2000)
`
`(similar); FDIC v. Fidelity & Deposit Co. of Maryland, 196 F.R.D. 375, 381 (S.D. Cal. 2000)
`
`(quoting from and adopting United Coal). As mentioned above, unlike a true privilege, the work
`
`product doctrine provides only a qualified and limited degree of immunity from discovery – as the
`
`Rule codifying the doctrine itself indicates – even after a party resisting discovery has met its
`
`initial burden of showing that material is protected, the material nevertheless must be disclosed
`
`“upon a showing that the party seeking discovery has substantial need of the materials in the
`
`preparation of the party’s case and that the party is unable without undue hardship to obtain the
`
`substantial equivalent of the materials by other means.” See Fed. R. Civ. P. 26(b)(3).
`
`
`
`Given that understanding, the court can now proceed to addressing the objections at bar.
`
`Neonode’s first justification for opposing the discovery sought by Apple is to state that Apple has
`
`not yet formally “served discovery requiring disclosure of the materials they now demand,” and
`
`that Apple “cannot simply send Plaintiff’s counsel an email demanding documents.” See Ltr. Br.
`
`3-4. The court finds that this argument places form over substance. While it is possible for the
`
`court to force Apple to serve formal document requests on Neonode in the manner suggested, the
`
`court can conceive of no reason to make Apple jump through that hoop at this time and under
`
`these circumstances. Given the truncated timeframe attending the Swedish depositions, forcing
`
`Apple to undertake the empty formality of serving these document requests in the manner
`
`demanded by Neonode would serve no purpose other than delaying Apple’s access to these
`
`documents, a spectacle which would inure to the benefit of no party. Neonode already knows what
`
`documents Apple seeks, and Neonode has already lodged its objections to producing those
`
`documents. Given these circumstances, the court sees no reason to put Apple to the trouble of
`
`engaging in a hollow formality for no legitimate reason other than to perhaps obstruct Apple’s
`
`access to discovery in advance of the rapidly-approaching dates for the Swedish depositions. Nor
`
`has Neonode cited to any authority for the proposition that the manner in which Apple’s discovery
`
`4
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 5 of 8
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`demands are brought to Neonode’s attention are to be so rigid and inflexible as to fall outside of
`
`this court’s discretion as to the manner in which they might be enforced. As mentioned above,
`
`Neonode’s first objection to producing the discovery in question unreasonably places form over
`
`substance and is therefore OVERRULED.
`
`
`
`Neonode’s second argument in opposing the discovery demands in question complains that
`
`Apple’s requests are overly broad to the extent that they seek all communications between Messrs.
`
`Goertz or Eriksson and Plaintiff without any limitation. See Ltr. Br. (dkt. 90) at 4. More
`
`specifically, Neonode submits that Apple “fail[s] to explain how emails with Goertz concerning an
`
`unconsummated consulting agreement might be relevant to any party’s claim or defense, or even
`
`to impeachment.” Id. However, given that Magnus Goertz is the named inventor of both patents in
`
`suit (see Compl. (dkt. 1) at 3), and given the liberal approach to relevancy described above, the
`
`court finds merit in Apple’s explanation to the effect that “[t]hese documents and communications
`
`are relevant at least to conception and reduction of practice of the alleged inventions (or lack
`
`thereof), validity of the claims, and credibility of the witnesses.” See Ltr. Br. (dkt. 90) at 1.
`
`Notably, Neonode has not asserted that producing these communications would be burdensome or
`
`disproportional to the needs of the case (see id. at 4), instead, the argument is that the breadth of
`
`the request (all communications) renders some of its sweep potentially irrelevant; however, for the
`
`reasons advanced by Apple, the undersigned disagrees. Accordingly, Neonode’s second objection
`
`is OVERRULED.
`
`
`
`Neonode’s third argument asserts that “any communications between Eriksson and
`
`Plaintiff, and identification of documents provided by Eriksson to Plaintiff, after the execution of
`
`the consulting agreement are work product.” Id. More specifically, Neonode contends that because
`
`of “the fact that Eriksson provided [certain documents and communications] to counsel [the
`
`documents would necessarily] reflect[] counsel’s requests for particular documents and categories
`
`of documents, which in turn reflects counsel’s opinions and evaluation of the importance to the
`
`case of certain types of documents.” Id. The court finds this concern to be exaggerated. First,
`
`while it is possible that some such communications may fall under the aegis of the work product
`
`doctrine, it is certainly far from clear at this juncture that the entirety of those communications
`
`5
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 6 of 8
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`would fit that rubric. Second, rather than to assert this argument in categorical form at this
`
`premature juncture, the court finds that a better method is for Neonode to detail such concerns as
`
`to specific and individual documents or communications in a privilege log; and, if a further
`
`dispute arises about the propriety of one or more of Neonode’s work product immunity assertions
`
`as to specific documents and communications, the Parties can present such a dispute to the
`
`undersigned for in camera review and resolution. Additionally, as described above, the work
`
`product doctrine is merely a limited and qualified immunity doctrine, not an absolute privilege –
`
`meaning that even when a document may fall fully within the ambit of the doctrine, circumstances
`
`may be present that would nevertheless dictate its production anyway. Accordingly, for these
`
`reasons, the court finds that Neonode’s third argument is both overblown (in that the argument is
`
`asserted in a manner as to have a scope that is excessively broad) and premature. The undersigned
`
`is willing to review and rule upon work product assertions in a specific and focused manner (as
`
`might relate to individual documents and communications that the court will have reviewed in
`
`camera), not in a generalized, abstract, and wholesale manner as Neonode appears to suggest.
`
`Accordingly, Neonode’s third objection is likewise OVERRULED.
`
`
`
`Neonode’s fourth argument substantially overlaps with its third argument. In this regard,
`
`Neonode contends that “[t]he selection of documents that counsel intends to use at deposition is
`
`protected by the work product privilege, because it reflects counsel’s strategy and opinions
`
`regarding the particular evidence that may be most supportive (or adverse) to his client’s position .
`
`. . [and therefore] [a]dvance disclosure of Plaintiff’s counsel’s selection of documents that he
`
`intends to use at deposition would of necessity reveal counsel’s evaluation of which documents he
`
`believes may be most useful with respect to these particular witnesses.” Id. at 5. On the other
`
`hand, Apple submits that it “needs such documents and communications in advance of the
`
`depositions in order to adequately prepare for cross-examination of the witness[es].” Id. at 2. First,
`
`the court is persuaded by Apple’s suggestion that preparation for an effective cross-examination of
`
`these witnesses would require Apple to have prior access to the documents and communications
`
`that Plaintiff’s counsel intends to use in the course of those direct examinations. Without such
`
`access to those documents, Apple’s efforts in the course of such cross-examinations would be
`
`6
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 7 of 8
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`severely hamstrung to say the least. Furthermore, notwithstanding Neonode’s mislabeling of the
`
`work product doctrine as a “privilege” – the court has already explained above that the doctrine is
`
`one of qualified and limited immunity that may be overlooked and bypassed given the right set of
`
`circumstances. As to those circumstances, Neonode would have to nevertheless produce such
`
`documents “upon a showing that [Apple] has substantial need of the materials in the preparation of
`
`the party’s case and that the party is unable without undue hardship to obtain the substantial
`
`equivalent of the materials by other means.” See Fed. R. Civ. P. 26(b)(3). Given that Neonode
`
`appears to be under a misapprehension that work product is an absolute privilege, when it is not –
`
`and given that the court cannot undertake the Rule 26(b)(3) analysis in the abstract, Neonode’s
`
`objections are once again presented in a wholesale and premature manner. To the extent that
`
`Neonode wishes to lodge such an objection, the place to do so would be in a privilege log such
`
`that if Apple wishes to challenge such a designation, that dispute can be brought to the court in a
`
`manner that is amenable to an intelligent ruling (that is, one that would be based on an in camera
`
`review of the document in question, and attended by full-throated briefing and/or argument
`
`regarding the Rule 26(b)(3) factors). Accordingly, Neonode’s fourth argument is OVERRULED.
`
`
`
`Lastly, Neonode’s fifth argument contends that “plaintiff has already produced all
`
`documents provided to plaintiff by [Mr.] Goertz [], and Eriksson provided no documents to
`
`plaintiff at any time prior to the execution of his consulting agreement [meaning that] [Apple’s]
`
`continued pursuit of this issue is a waste of time and resources.” See Ltr. Br. (dkt. 90) at 5. This
`
`statement overlooks several facts: (1) it does not address the documents that Neonode intends to
`
`use during the Swedish depositions; (2) it does not address communications between Plaintiff’s
`
`counsel and Messrs. Goertz and Eriksson; (3) it does not address documents provided by Mr.
`
`Eriksson after the execution of his consulting agreement (some of which might conceivably not be
`
`covered by the work-product doctrine at all, and others of which might need to be produced under
`
`Rule 26(b)(3) notwithstanding the work product doctrine). As stated above, without a privilege log
`
`and in camera review, and without being able to entertain focused and document-specific
`
`arguments from the Parties about the Rule 26(b)(3) factors as to each challenged document, the
`
`court cannot intelligently or fairly render work-product rulings under the doctrine. Accordingly,
`
`7
`
`Northern District of California
`
`United States District Court
`
`

`

`Case 3:21-cv-08872-EMC Document 91 Filed 04/29/22 Page 8 of 8
`
`
`
`Neonode’s fifth objection is similarly OVERRULED.
`
`
`
`Therefore, on or before 12:00 noon on May 4, 2022, Neonode is ORDERED to produce
`
`(1) all documents Neonode Smartphone or its counsel has obtained from Messrs. Goertz or
`
`Eriksson, including the consulting agreement with Mr. Eriksson; (2) all communications between
`
`Neonode Smartphone or its counsel and Messrs. Goertz or Eriksson; (3) all documents Neonode
`
`Smartphone may use at the depositions of Messrs. Goertz or Eriksson; and (4) to the extent
`
`Neonode Smartphone intends to withhold any of the above-mentioned documents or
`
`communications based on any assertion of privilege or the work product doctrine, Neonode shall
`
`prepare and produce a privilege log of all withheld documents and communications.
`
`IT IS SO ORDERED.
`
`Dated: April 29, 2022
`
`
`
`
`
`
`
`ROBERT M. ILLMAN
`United States Magistrate Judge
`
`8
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`