Discovery Sanctions: Professor Georgene Vairo on Qualcomm Inc. v. Broadcom Corp.

Discovery Sanctions: Professor Georgene Vairo on Qualcomm Inc. v. Broadcom Corp.

In Qualcomm Inc. v. Broadcom Corp., a magistrate judge in the United States District Court for the Southern District of California has awarded one of the highest monetary sanctions awards ever for misconduct relating to e-discovery. The district court subsequently vacated and remanded the magistrate’s ruling. Law Professor Georgene Vairo outlines the court's reasoning and notes the relationship between retained and corporate attorneys when conducting broad e-discovery. Professor Vairo writes:
 
     The magistrate judge in the United States District Court for the Southern District of California sanctioned both a party and its counsel when it was discovered through trial testimony that the party failed to disclose thousands of e-mails and other documents relevant to the case. The court ordered the plaintiff to pay all the defendant's attorneys' fees and costs, $8.5 million, for "monumental and intentional discovery violation." In addition, the court found that six Qualcomm attorneys engaged in "intentionally hiding or recklessly ignoring relevant documents . . . and blindly accepting Qualcomm's unsupported assurances that its document search was adequate."
 
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     The district court noted that the retained attorneys had filed a Motion for an Order Determining that the Federal Common law Self-Defense Exception to Disclosing Privileged and/or Confidential Information Applies to the sanctions motion before the magistrate judge. The motion was denied. Thereafter . . . the magistrate judge imposed the sanctions on Qualcomm, some of its attorneys and six retained counsel. The district court, on appeal from the sanctions order, confirmed that the magistrate judge had jurisdiction to award the sanctions. However, it ruled that on remand, the retained attorneys should be permitted to pierce the attorney client privilege on the grounds of self-defense. After Qualcomm refused to waive the privilege before the sanctions proceeding before the magistrate judge, it filed declarations that were critical of the retained counsel. “This introduction of accusatory adversity between Qualcomm and its retained counsel regarding the issue of assessing responsibility for the failure of discovery changes the factual basis which supported the court's earlier order denying the self-defense exception to Qualcomm's attorney-client privilege.” Accordingly, it vacated and remanded the sanctions order with respect to the six retained attorneys.
 
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    It is notable that the district court [order vacating and remanding the magistrate’s sanction order] did not suggest that the magistrate judge was incorrect in originally denying the motion to pierce the privilege. Rather, changed circumstances dictated their right to pierce. Similarly, the district court’s comment about the magistrate judge’s discretion demonstrates that the retained attorneys are not necessarily out of the woods. [T]he magistrate judge imposed sanctions against the retained attorneys after finding that they had failed to conduct a reasonable inquiry and had blindly accepted the client’s assertions. According to the magistrate judge, they recklessly ignored relevant documents and numerous warning signs that Qualcomm's document search was inadequate, and they blindly accepted unsupported assurances that Qualcomm's document search was adequate.
 
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