As others have reported (see, e.g., several good pieces on Wired’s Epicenter blog posted by Ryan Singel on August 6, August 10 and August 11, 2011 [post-publication note: see also Ryan's August 15 post]), Paul D. Ceglia’s claim that he is entitled to part ownership of Facebook, Inc. now involves allegations by Facebook that Mr. Ceglia is trying to deny defendants access to critically important ESI — including what Facebook characterizes as the “authentic contract” as well as information about certain storage devices — by designating the ESI as privileged and/or designating it as confidential under the protective order filed on July 13, 2011.
Last Friday, following her in camera review of documents provided by Mr. Ceglia’s counsel, U.S.M.J. Leslie G. Foschio issued a Decision and Order (docket no. 107, filed Aug. 12, 2011) granting in part and denying in part the motion of defendants Mark Zuckerberg and Facebook, Inc. to reject Mr. Ceglia’s assertions (1) that certain documents found on his computers are protected by the attorney-client privilege and (2) that 120 documents plaintiff designated as confidential under the protective order were properly designated. Ceglia v. Zuckerberg, 10-CV-569A(F) (W.D.N.Y. Aug. 12, 2011). Magistrate Judge Foschio held that all four assertedly privileged documents were not privileged, and that the majority of the 120 items designated by plaintiff as confidential were improperly designated.
1. Attorney-Client Privilege.
At issue on the privilege argument were four items on plaintiff’s privilege log:
- Item 1. The court held that this unaddressed email transmitting a copy of a contract (the contract purportedly at the heart of plaintiff’s claims) was not privileged — even if (as plaintiff maintained) plaintifff’s attorney was the intended recipient — because “it neither seeks confidential legal advice nor constitutes a confidential communication relating to such advice.”
- Item 2. The court also held that this purported excerpt from the alleged Ceglia-Zuckerberg contract was not privileged, given the lack of evidence that it was “submitted on a confidential basis to an attorney from whom Plaintiff was seeking advice or legal services such as reviewing or drafting the contract”.
- Items 3 and 4. For similar reasons, the court found that neither the purported March 3, 2004 email from plaintiff to his attorney (item 3) nor the purported excerpt of the allegedly signed Ceglia-Zuckerberg contract (item 4) was covered by the attorney-client privilege.
Judge Foschio ordered plaintiff to produce items 1-4 to defendants by 10:00 A.M. on August 17, 2011.
2. Confidentiality Designations.
Defendants also challenged plaintiff’s designation of 120 documents as confidential under the parties’ Joint Stipulated Protective Order (docket no. 86, filed July 13, 2011). Focusing on whether plaintiff’s designations were (as required by ¶ 3 of the protective order)
based on a good faith belief that the designated material contains confidential information that is not publically available “such as proprietary or confidential business, technical, sales, marketing, financial, commercial, private, or sensitive information, or information that is otherwise reasonably designable as confidential,”
the court found that some designations were properly made while others (a majority of the items in issue) were not. Among the court’s findings:
- Items 1-4 (mentioned above regarding plaintiff’s assertion of privilege). Not properly designated as confidential — among other things, “the document [the purportedly signed agreement] was allegedly executed by Zuckerberg” and “a copy of the executed agreement was attached by Plaintiff to the Complaint in this action.”
- Items 5-11: unsigned versions of the agreement. Same conclusion based on similar rationale.
- Items 12-38: electronic communications among Ceglia, Zuckerberg and others involved in the StreetFax software development project. Confidentiality designation sustained, given that the communications “addressed . . . a variety of personal and technical matters arising as the parties attempted to develop the StreetFax software and website called for by their contract.”
- Items 39-45: computerized results of development-related testing. Designation sustained.
- Items 47-75: metadata of overwritten deleted files associated with documents properly designated as confidential. Designation rejected:
[A]s the metadata by definition does not reveal the substance of the document to which they are related, designating them as confidential is not based on a good-faith belief in the confidential nature of the information to which they relate, e.g., the author of the document or the date of its creation.
- Items 76-91: link files to documents on removable media. Link files contain “no confidential personal, technical or proprietary information” and thus there was no good-faith basis for the designation.
- Items 92-112: registries to USB mass-storage devices attached to plaintiff’s computers. Designation rejected: items reveal no confidential information.
- Item 113: EnCase® Forensic software product. Designation rejected: item represents no confidential information.
- Items 114-15: system event logs. Designation rejected: “the court fails to see how [these activity-based logs] . . . may reveal confidential information”.
- Items 116-19: metadata for system restore points. Not properly designated as confidential.
- Item 120: forensic artifacts, i.e., “fragments of data from a partially overwritten computer file likely located by the EnCase® Forensic tool.” Held: “to the extent the fragment file is from one entitled to be treated as confidential, it is also a confidential document; if not, it is not confidential.”
A hearing is set for August 17 on the parties’ respective motions to compel production of withheld materials. Stay tuned.
