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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

GREEN MOUNTAIN GLASS, LLC and


CULCHROME, LLC,
Plaintiffs,
v.
SAINT-GOBAIN CONTAINERS, INC. dba
VERALLIA NORTH AMERICA,
Defendant.

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C.A. No. 14-392-GMS

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ORDER
WHEREAS, presently before the court is the defendant's Motion to Compel Concerning
Defense Counsel's Improper Possession of Plaintiffs' Privileged Documents, filed on December
5, 2014 (D.I. 48);
WHEREAS, the court having considered the parties' papers and the applicable law;
IT IS HEREBY ORDERED THAT:
1. The defendant's Motion to Compel (D.I. 48) is DENIED; 1

The plaintiffs Green Mountain Glass, LLC and Culchrome, LLC ("the Plaintiffs") filed this patent
infringement lawsuit against the defendant Saint-Gobain Containers, Inc. ("the Defendant") on March 28, 2014.
(D.1. 1.) The Plaintiffs accuse the Defendant of infringing U.S. Patent Nos. 5,718,737 ("the '737 Patent") and
6,230,521 ("the '521 Patent").
The subject of this motion concerns allegedly privileged materials that were provided to the Defendant by a
non-party, Frank Pringle ("Pringle"). Pringle was initially listed as a co-inventor on patent application 08/399,299
("the '299 Application"), which ultimately matured into the '737 Patent. The '299 Application also listed Duane
Mosch and Kevin Coffey as co-inventors, and the application was assigned to a now-defunct company EFTEK
Corporation ("EFTEK"). The '299 Application was subsequently abandoned and assigned to International Cullet
Exchange ("ICE"), which pursued and obtained the '737 Patent. ICE was the predecessor of the Plaintiffs. As
issued, the '737 Patent lists only Duane Mosch as the sole inventor, and it was also assigned to ICE. Thus, ICE (and
by extension, the Plaintiffs) possessed unbroken chain of title of ownership of the prosecution documents, but it was
not actually involved with the prosecution of the '299 Application.
The question central to this motion is whether the privilege held by EFTEK and/or Pringle during the
prosecution of the '299 Application was passed to ICE and the Plaintiffs by virtue of the assignment. If yes, then
only the Plaintiffs could waive the privilege, and the Defendant's use (if any) of the Pringle documents would be

2. The parties shall proceed with discovery and shall complete depositions for
inventors Duane Mosch and Richard Lehman.

improper. See Brigham & Women's Hosp. Inc. v. Teva Pharm. USA, Inc., 707 F. Supp. 2d 463, 469-70 (D. Del.
2010) ("Because the privilege belongs to the client, not the attorney, only the client may waive it." (citing In re
Seagate Tech., LLC, 497 F.3d 1360, 1372 (Fed. Cir. 2007))). But if the assignment of the '299 Application did not
effect a transfer of privilege, the Plaintiffs have no standing to assert such a privilege here.
Both parties discuss an Eastern District of Texas case analyzing the issue of "whether a transfer of assets
preserves a claim of privilege." See SimpleAir, Inc. v. Microsoft Corp., No. 2:1 l-cv-416-JRG, 2013 WL 4574594,
at *2 (E.D. Tex. Aug. 27, 2013). SimpleAir held that "a 'mere transfer of assets' does not also transfer the
privilege," but additional facts showing a relationship between the assignor and assignee may show that the
assignor's privilege accompanies the transfer. Id. Thus, there is no bright-line rule; the court must engage in a close
examination of the facts. Id. "If the practical consequences of the transaction result in the transfer of control of the
business and the continuation of the business under new management, the authority to assert or waive the attorneyclient privilege will follow as well." Id. (quoting Soverain Software LLC v. Gap, Inc., 340 F. Supp. 2d 760, 763
(E.D. Tex. 2004)).
The court finds that the Plaintiffs did not inherit the attorney-client privilege through assignment of the
'299 Application, and therefore the motion should be denied. Pringle was the president of EFTEK at the time of
prosecution of '299 Application. (D.I. 53 at 3-4; Ex. C.) Thus, there is little doubt that Pringle and/or EFTEK held
the privilege initially. The Plaintiffs argue that subsequent actions demonstrate that a relationship existed such that
privilege was transferred with the assignment. First, the other two original co-inventors, Mosch and Coffey, formed
ICE. (D.1. 55, Ex. 6.) But conspicuously absent from ICE's founders is Pringle-the president ofEFTEK. EFTEK
was prosecuting the '299 Application with the assistance of attorney Stephan Gribok. (D.1. 53, Ex. H.) The
Plaintiffs have offered no argument that Mosch or Coffey had any connection with EFTEK, aside from being named
inventors on the '299 Application. Thus, the formation of ICE by Mosch and Coffey does not establish a link
showing "the transfer of control of the business and the continuation of the business." SimpleAir, 2013 WL
4574594, at *2.
Second, the Plaintiffs identify a planned stock-for-stock merger, in which EFTEK would have acquired
ICE. (D.I. 55, Ex. 7.) Had such a merger taken place, the Plaintiffs could show that a continuous relationship
existed between EFTEK and ICE, and that privilege may have been transferred. But the anticipated merger did not
occur. As such, the Plaintiffs' argument has little force. The Plaintiffs assert that the planned merger is evidence
that "the named inventors always intended that ICE would be assigned the patent." (D.1. 54 at 10.) But this does
not help their case. Indeed, intent to assign the patent only supports the alternative view that this was a "mere
transfer of assets" rather than an existential business transaction. The same flaw in reasoning underlies the
Plaintiffs' third argument-that EFTEK represented that ICE was the owner of the patent. (D.I. 55, Ex. 8.) There is
no dispute that ICE came to possess full chain of title over the '299 Application. But this transaction does not
demonstrate that ICE and the Plaintiffs came to inherit the privilege held by EFTEK.
Thus, the court finds that the Plaintiffs do not hold the attorney-client privilege over the Pringle documents
and therefore cannot prevent the Defendant's use of the materials. There was no evidence that "the practical
consequences of the transaction result[ ed] in the transfer of control of the business and the continuation of the
business under new management." SimpleAir, 2013 WL 4574594, at *2. While EFTEK and ICE were certainly not
strangers to one another, the court sees no relationship that would support a transfer of privilege. Ownership of the
'299 Application alone does not confer the right to assert another's privilege. See Telectronics Proprietary, Ltd. v.
Medtronic, Inc., 836 F.2d 1332, 1338 (Fed. Cir. 1988) ("[A]ttorneys represent clients-not legal positions or
patents."). Having found no impropriety, there is no need to inquire into the Defendant's use of the Pringle
documents or entertain the possibility of disqualification of defense counsel. The parties shall continue with
discovery according to schedule.

Dated: January

4,

2015

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