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In-House Counsel May View 'Outside Counsel Only' Discovery

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By Jonathan R. Tung, Esq. on February 19, 2016 2:59 PM

There are times when even best attempts to obtain a particular outcome fail, and the case of Sanofi-Aventis v. Breckenridge represents that fact in spades. Federal Magistrate Judge Lois Goodman ruled that in-house counsel may view "outside counsel only" documents because the lawyer in question was sufficiently walled-off from conflict.

In-House Attorney Access

Drug maker Sanofi-Aventis brought a couple of suits against defendant Breckenridge Pharmaceutical alleging patent infringements on its drug Jevtana. Breckenridge had filed a new drug application for a generic version of Jevtana, according to court papers. Sanofi-Aventis is also suing other companies too.

In the case with Breckenridge, Sanofi-Aventis agreed to all the terms of a discovery confidentiality order except on the issue of how much access one of Breckenridge's in-house counselor Robert Vroom would be allowed. Vroom is one of four of Breckenridge's in-house attorneys. He also reports directly to the company's general counsel who also happens to be Breckenridge's VP of corporate strategy.

"Chinese Wall"

Vroom contends that Breckenridge created the position of "litigation counsel" to satisfy rules first outlined in the 1984 case of U.S. Steel v. United States. In that case, it was found that the status of in-house counsel cannot -- by itself -- serve as a basis for denial of access to discovery and that a case-by-case analysis would be performed to determined if the subject lawyer engaged in competitive decision making that would pose a conflict.

If this all seems somewhat familiar, it is very similar to the notion that imputation does not contaminate an entire firm for conflict so long as a sufficient "Chinese Wall" is in place. There is some debate of course as to how effective this practice is.

Judge Goodman bought Breckenridge's theory and observed that "it would be difficult to imagine how Breckenridge might further isolate Vroom in order to reduce the risk of inadvertent disclosure."

In-house lawyers in Sanofi-Aventis' position will have to keep in mind that the plain language of any discovery confidentiality order may be subject to U.S. Steel v. United States. Further measures will have to included in order to compensate for this possibility.

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