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McAirlaids, Inc. v. Kimberly-Clark Corp.

United States District Court, Fourth Circuit

May 31, 2013

MCAIRLAIDS, INC., Plaintiff,


Robert S. Ballou United States Magistrate Judge

This matter is before the court on the Motion of Plaintiff McAirlaids, Inc. ("McAirlaids") to Compel Un-Redacted Copies of Defendants‘ Documents (Dkt. No. 44). A hearing was held, the issues have been briefed, and the documents were reviewed in camera. For the reasons set forth below, McAirlaids‘ motion is DENIED.


This is an action for federal trade dress infringement under Section 32(1)(a) of the Lanham Act, 15 U.S.C. § 1114(1)(a) and the common law, and for unfair competition and false designation of origin in violation of Section 43 of the Lanham Act, 15 U.S.C. § 1125(a) and the common law. Compl. ¶ 1, Dkt. No. 1. Defendants Kimberly-Clark Corporation, Kimberly-Clark Worldwide, Inc. and Kimberly-Clark Global Sales, LLC (collectively, "Kimberly-Clark" or "K-C") filed a counterclaim seeking cancellation of the trademark at issue in the trade dress infringement action, U.S. Trademark Registration No. 4, 104, 123. The core issue of this action is whether the embossing of certain material on bed mats affected the functionality of the product or violated the trade dress of the embossing pattern utilized by McAirlaids in its product.

The court has entered an agreed protective order governing the production of documents during discovery, which allowed the designation of documents as "Confidential Information, " and "Confidential Attorney Eyes Only Information." Dkt. No. 22. The protective order also contained a provision allowing a producing party to "claw back" a document (or portion thereof) which inadvertently or unintentionally produced otherwise privileged information. K-C produced in discovery a seven page strategic memorandum titled "Intellectual Assets Strategy, " prepared by a project leader employed by K-C, and disseminated to certain employees within the company ("the IAS document"). K-C marked the IAS document as "Confidential- Attorneys Eyes Only, " and redacted two portions of the document as attorney-client privileged communications prior to producing it in discovery.

McAirlaids now seeks an unredacted version of the IAS document, claiming that the redactions do not rise to the level of attorney-client communications because the IAS document is a business document; the IAS document was not drafted by an attorney or conveyed to an attorney; and, the IAS document was not drafted for the purpose of obtaining or conveying legal advice. McAirlaids further argues that any privilege that applied to the IAS document was waived by the dissemination of the document to other K-C employees beyond a "need to know" basis.

At the hearing on this matter, the court ordered that K-C produce the unredacted IAS document for an in camera review, and present information with regard to whom the document was disseminated. K-C produced an unredacted copy of the document at issue for in camera review, as well as a Declaration by Jon Rooyakkers, the author of the document, claiming that the redacted statements consisted of information provided either directly by K-C‘s legal counsel, or by Marci Ruman, the product technical leader, who obtained the information directly from legal counsel. Decl. Jon Rooyakkers, ¶ 8, Dkt. No. 61, Ex. B. Mr. Rooyakkers included the redacted information in the IAS document, which was treated as a confidential and highly sensitive business document. Decl. Jon Rooyakkers, ¶ 4, Dkt. No. 61, Ex. B. The IAS document was distributed within K-C to a "limited" number of people, including the Director of Research and Engineering, the Product Technical Leader, a Research and Engineering Specialist, a Patent Strategist, and a Research and Engineering Senior Manager. Decl. Jon Rooyakkers, ¶ 6, Dkt. No. 61, Ex. B.

Both parties filed briefs explaining their position with respect to the redactions. In its reply brief on the motion at issue, K-C asserted that there are additional statements in the IAS document that constitute attorney-client privileged information, which were inadvertently produced to McAirlaids without redaction. K-C now requests that the court order that McAirlaids return the current version of the IAS document to K-C so that it may redact the additional statements that fall within the attorney-client privilege.


A proper analysis of privilege questions must begin with a determination of the applicable law. Federal Rule of Evidence 501 provides that, for claims and defenses for which federal law applies, federal common law governs a claim of privilege, unless the Constitution, federal statutory law, or the Federal Rules provide otherwise. Fed.R.Evid. 501. Conversely, when State law "supplies the rule of decision" for an element of a claim or defense, the privilege "shall be determined in accordance with State law." Id. Here, the claims McAirlaids asserts pose a federal question based on the Lanham Act, as well as supplemental state law claims. When both federal and state substantive laws apply, "Rule 501 would seem to require that federal privilege law control the federal claims, and state privilege law control the supplemental state law claims." Cont'l Cas. Co. v. Under Armour, Inc., 537 F.Supp.2d 761, 767 n. 3 (D. Md. 2008). Yet, "the majority of courts … have held that federal privilege trumps state law, because were it otherwise, the jury would be faced with a hopelessly confusing task." Id (collecting cases). Thus, federal privilege law applies to the privilege issues in this case.

The attorney-client privilege is the oldest privilege for confidential communications known to the common law. Upjohn Co. v. U.S., 449 U.S. 383, 389, 101 S.Ct. 677, 682, 66 L.Ed.2d 584 (1981). The purpose of the attorney-client privilege is to "promote broader public interests in the observance of law and administration of justice ... [t]he privilege recognizes that sound legal advice or advocacy serves public ends and that such advice or advocacy depends upon the lawyer's being fully informed by the client." Id Where the attorney-client privilege applies, "it affords confidential communications between lawyer and client complete protection from disclosure." Hawkins v. Stables, 148 F.3d 379, 383 (4th Cir. 1998). It applies to individuals and corporations, and to in-house and outside counsel. See Upjohn, at 394, 101 S.Ct. at 685. "Because the attorney-client privilege 'impedes the full and free discovery of the truth, it must be narrowly construed and recognized only to the very limited extent that excluding relevant evidence has a public good transcending the normally predominant principle of utilizing all rational means for ascertaining truth.‘" Deel v. Bank of America, N.A., 227 F.R.D. 456, 457 -458 (W.D.Va. 2005)(quoting In re Grand Jury Subpoena, 341 F.3d 331, 335 (4th Cir. 2003).

A party asserting that a communication is protected by the attorney-client privilege has the burden of showing that it applies. Deel 227 F.R.D. at 458. (citing In re Grand Jury Subpoena, 341 F.3d 331, 336 (4th Cir. 2003). "'The proponent must establish not only that an attorney-client relationship existed, but also that the particular communications at issue are privileged and that the privilege was not waived. Any disclosure inconsistent with maintaining the confidential nature of the attorney-client relationship waives the privilege.‘" Id (quoting United States v. Jones, 696 F.2d 1069, 1072 (4th Cir. 1982).

The Fourth Circuit applies the "classic test" of the attorney-client privilege:

(1) the asserted holder of the privilege is or sought to become a client; (2) the person to whom the communication was made (a) is a member of a bar or court, or his subordinate and (b) in connection with this communication is acting in his capacity as a lawyer; (3) the communication relates to a fact of which the attorney was informed (a) by his client (b) without the presence of strangers (c) for the purposes of securing primarily either (i) an opinion on law or (ii) legal services or (iii) assistance in some legal proceeding, ...

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