Key insights
- Broadcom is suing EU regulators over document requests related to the VMware acquisition, citing legal privilege concerns. While the lawsuit itself has limited direct impact, the underlying antitrust investigation into Broadcom's practices following the VMware acquisition could create uncertainty and potentially weigh on Broadcom's stock if the EU Commission takes adverse action.
Investing.com -- Broadcom filed a lawsuit on Wednesday against European Union antitrust regulators over requests for documents containing legal advice from its U.S. lawyers in a case related to VMware, which the chip company acquired in 2023.
The company brought its case to the Luxembourg-based General Court, Europe’s second-highest court, stating it is acting on principle to protect legal professional privilege.
Broadcom said the filing is a procedural action solely to protect its rights under recognized rules on legal professional privilege in non-EU countries, including the U.S. The company added it is otherwise cooperating with the European Commission’s requests for information, according to a Reuters report on Wednesday.
Attorney-client privilege protects confidential communications between lawyers and their clients made for the purpose of requesting or rendering legal advice. Rules pertaining to this privilege vary across different jurisdictions.
In the EU, this status covers only communications between a company and its external lawyers but not in-house lawyers.
The European Commission, which acts as the EU competition enforcer, said it is ready to defend all its decisions in court.
Lobbying group CISPE filed an EU antitrust complaint against Broadcom in March, calling on regulators to temporarily stop the company from ending its VMware Cloud Service Provider programme in Europe.
CISPE said Broadcom cannot demand complete disclosure from its members affected by its practices while maintaining opacity around its own internal communications and relevant evidence in the ongoing antitrust investigation.
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