841 F.3d 1327
Fed. Cir.2016Background
- The dispute concerns ownership of MOVA Contour Reality Capture technology (patents, source code, hardware) between petitioners (Rearden LLC, Rearden MOVA LLC, MO2, LLC, MOVA, LLC) and respondents (SHST and later VGHL).
- Petitioners contend Rearden/Perlman formed the original MO2 and thus acquired/controlled the MOVA assets; respondents contend LaSalle (a former Rearden employee) acquired the assets for MO2 and later sold them to SHST.
- SHST sued in 2015 seeking a declaration of ownership and asserting state-law false-advertising/unfair-competition claims; petitioners counterclaimed for patent infringement and declaratory relief asserting they own the patents.
- During discovery, the magistrate ordered production of communications between original MO2 and the corporate attorney introduced by Perlman, finding petitioners could not assert attorney-client privilege on behalf of original MO2 and that LaSalle waived privilege by sharing documents.
- The district court denied petitioners’ objections and refused to consider an additional Perlman declaration submitted for the first time on review; petitioners sought mandamus from the Federal Circuit to overturn the discovery order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Federal Circuit jurisdiction over mandamus petition | VGHL argued mandamus would not be "in aid of" Federal Circuit jurisdiction | Petitioners did not dispute appellate jurisdiction over compulsory patent counterclaims | Court held it has jurisdiction because petitioners’ patent counterclaims are compulsory and thus fall under 28 U.S.C. § 1295(a) |
| Whether petitioners’ counterclaims are compulsory (affecting jurisdiction) | Counterclaims arise from same transaction and patents as plaintiff’s claims | Plaintiff argued counterclaims were related to state-law ownership claims | Court held counterclaims are compulsory under Rule 13(a): same patents/factual issues, overlapping evidence, logical relationship |
| Right to withhold documents via corporate attorney-client privilege | Petitioners argued Rearden/Perlman (not LaSalle) controlled original MO2 and could assert privilege; asserted district court should defer resolution until full ownership determination | Respondents argued petitioners lacked standing to assert privilege for original MO2 and LaSalle waived privilege | Court denied mandamus — upheld district court’s preliminary factual findings that petitioners failed to show they could assert the privilege and that waiver occurred; factual disputes better resolved at trial |
| District court’s refusal to admit supplemental Perlman declaration and to hold evidentiary hearing | Petitioners argued the district court abused discretion by excluding new declaration and failing to hold an evidentiary hearing | Respondents argued district court acted within discretion; no rule requires supplementation or additional hearing | Court held denial of supplementation/hearing was not an abuse of discretion and not mandamus-worthy; petitioners had alternative remedies at trial/appeal |
Key Cases Cited
- Kerr v. U.S. Dist. Court, 426 U.S. 394 (mandamus standard and narrow availability of relief)
- Mohawk Indus., Inc. v. Carpenter, 558 U.S. 100 (privilege orders reviewable, but mandamus relief limited when trial provides adequate review)
- Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826 (limitations on federal-question jurisdiction pre-America Invents Act)
- Vermont v. MPHJ Tech. Invs., LLC, 803 F.3d 635 (Federal Circuit jurisdiction over compulsory patent counterclaims)
- Nasalok Coating Corp. v. Nylok Corp., 522 F.3d 1320 (tests for whether counterclaim arises from same transaction or occurrence)