In-House Counsel May View “Outside Counsel Only” Documents

A federal magistrate judge in Trenton has allowed in-house counsel for a New Jersey corporation to view discovery documents designated for “outside counsel eyes only.” The ruling in Sanofi-Aventis U.S. LLC v. Breckenridge Pharmaceutical, Inc., Nos. 15-289 & 15-1836, relates to a pair of patent infringement lawsuits filed by Sanofi-Aventis against Breckenridge Pharmaceutical Inc. regarding a prostate cancer treatment drug. The parties’ stipulated confidentiality order did not specify whether Breckenridge’s in-house litigation counsel, Robert Vroom, would be permitted to review discovery designated as “outside counsel eyes only.” Sanofi objected to permitting Vroom access to the documents, contending that Vroom, one of only four in-house attorneys at Breckenridge, reported to the company’s general counsel, who was also vice president of corporate strategy. The Court disagreed with Sanofi after conducting a “case-by-case inquiry” to determine whether an in-house lawyer engages in competitive decision-making that could pose a risk of protected information being inadvertently disclosed, required by a 1984 decision from the Federal Circuit Court of Appeals, U.S. Steel v. United States. The Court held that sufficient measures were put in place to separate Vroom from his peers and competitive decision-making so as to entitle him to review the discovery items at issue. The Court found significant Breckenridge’s decision to create the position of “litigation counsel” to permit in-house counsel to function as an outside attorney. Vroom, the Court concluded, did not engage in the decision-making process for pricing, product design, patent prosecution or deciding when to seek FDA approval for production of a drug and he does not have access to Breckenridge’s network drives, reducing the risk of inadvertent disclosure to the company. The Court’s order included some protections to further ensure that competitively sensitive information is not disclosed to Breckenridge. Breckenridge was ordered to maintain separate computer facilities for Vroom, who is not permitted to review, store or access any information designated as “outside counsel eyes only” while at any Breckenridge facility. For more information on discovery confidentiality orders or the implications of the decision in Sanofi-Aventis U.S. LLC v. Breckenridge Pharmaceutical, Inc., please contact Kathleen Barnett Einhorn, Esq., Director of the firm’s Complex Commercial Litigation Group at keinhorn@genovaburns.com, or Jennifer Borek, Esq., a Partner in the Complex Commercial Litigation Group at jborek@genovaburns.com