December 01, 2009

In the latest edition of the Litigation Spotlight, we highlight a number of developments that may be helpful to your practice.  For example, continuing a recent trend regarding electronic discovery, we discuss two cases in Electronic Discovery regarding courts’ frustration with e-discovery efforts.  (Capitol Records, Mirbeau).

We also discuss a series of cases that concern the scope of protections afforded by the attorney-client privilege.  In Securities Litigation, we discuss how the United States Court of Appeals for the Second Circuit expressly refused to apply the “fruit of the poisonous tree” doctrine to the administrative investigatory arena when it declined to quash an investigative subpoena based on allegedly privileged information (SEC v. Finazzo).  In Professional Responsibility, we discuss a case where the Department of Labor Administrative Review Board held that an in-house attorney could use privileged information to support a retaliation claim under the Sarbanes-Oxley Act’s whistleblower protection provisions (Jordan).  In Privilege Issues, we discuss a number of other privilege decisions, including a court’s limitation of a privilege waiver under the new Federal Rules of Evidence 502(a) (SEC v. Bank of Am.) and a holding that bondholders could introduce evidence that they had consulted with counsel without waiving the attorney-client privilege so long as they did not seek to introduce evidence that they had reasonably relied on the advice (Aristocrat Leisure).

We also discuss a number of cases involving the expanding scope of government prosecutions and enforcements.  The SEC recently brought its first civil enforcement action under Regulation G (Securities Litigation: SEC v. SafeNet).  The former CEO of InterMune, Inc., was convicted of wire fraud related to a press release touting the efficacy of one of InterMune’s drugs (Health Care Litigation: United States v. Harkonen).  We also note the Department of Justice’s trend of cooperating with foreign authorities in bringing civil and criminal charges (White Collar Defense & Investigations: United States v. Agco Ltd.).

In addition, we  discuss how several Justices of the Supreme Court of the United States noted that a New Jersey statute allowing allocation of the cost for the class notice to defendants raises serious due process concerns, although the Justices did not dissent from the denial of certiorari in this case (Appellate & Supreme Court, Class Action: DTD Enterprises).  The United States Court of Appeals for the Ninth Circuit also held that only courts, not arbitrators, may decide the threshold question of whether a clause requiring arbitration is unconscionable (Arbitration: Rent-a-Center).  An Oregon court of appeals reversed a punitive damages award as violating due process because it was 20 times the amount of actual damages (Wieber).

Regards, David J. Bradford and Craig C. Martin

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