Discovery

Replacing the Words “Trade Secrets” with “Confidential Information” Does Not Allow a Party to Bypass Its Obligations Under California Code of Civil Procedure Section 2019.210

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In a recent discovery dispute before the Northern District of California,[1] Plaintiff Monolithic Power Systems, Inc. (“Monolithic”) unsuccessfully attempted to bypass California Code of Civil Procedure section 2019.210 which requires the party making a claim of trade secret misappropriation under the California Uniform Trade Secrets Act (“CUTSA”) to identify the trade secret “with reasonable particularity” before “commencing discovery relating to the trade secret.”

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From Corn-Gate to You-Stole-My-Trade-Secrets-Gate (Maybe): Defendant Beer Maker Moves to Add a Counterclaim for Trade Secrets Misappropriation in False Advertisement Litigation

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MillerCoors (beer maker of Coors Light and Miller Lite) and Anheuser-Busch (“AB”) (competing beer maker of Bud Light) have been embroiled in a contentious federal district court litigation in the W.D. of Wisconsin since March 2019. MillerCoors filed a lawsuit against AB for false advertising and trademark dilution shortly after AB aired an ad during Super Bowl LIII saying that MillerCoors uses corn syrup during brewing. MillerCoors’ lawsuit alleges that this ad was part of a “false and misleading advertising campaign” designed to deceive consumers into thinking they will consume corn syrup if they drink Coors Light and Miller Lite, which MillerCoors denies. READ MORE →

Global Reach: U.S. Federal Rules Provide Assistance for Discovery in Foreign Matters

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Imagine the following scenario: Your company has filed several lawsuits around the world, all concerning generally the same subject matter, but against different parties because of jurisdictional limitations. The litigation overseas is subject to discovery rules that are far more limited than those available in the United States. The U.S. litigation has been stayed pending the result of the foreign matter. However, important information and witnesses that are useful in prosecuting the foreign litigation are located in the U.S., outside of the foreign court’s jurisdiction and applicable discovery rules. In this complex situation, is there any way to obtain that critical bit of information? Or can the U.S. witnesses evade all production and testimony because of jurisdictional bounds? READ MORE →

Spring Cleaning: Tidying Up Your “Reasonable Efforts” to Maintain Trade Secrets

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It’s among an in-house counsel’s worst nightmares. A former business partner, ex-employee, consultant, or competitor has stolen your company’s trade secret information. Company management demands swift action. You hire outside counsel who, after reviewing your company policies and interviewing stakeholders, tells you that he or she is concerned about being able to establish that your company took “reasonable efforts” to protect the information. Listening to the feedback, you realize with a sinking feeling that these were steps that you, as in-house counsel, may have been able to implement if you had only thought about the issue sooner. READ MORE →

Fishing for ESI

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When National Fish and Seafood’s (NFS) head of research left for a new opportunity at Tampa Bay Fisheries, she may not have taken just her talents to the competition.  According to NFS’ lawsuit, the former employee transferred thousands of files containing confidential and proprietary information prior to her departure from the company.  NFS also alleges that the CEO of Tampa Bay Fisheries conspired with NFS’s former employee to steal trade secrets involving its proprietary clam production process.

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Revised Trade Secrets Disclosures May Be Costly

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In some cases, there may be a severe cost – even a monetary cost – for plaintiffs who seek to materially amend their trade secrets disclosure following discovery.  This is what happened to the plaintiff, Swarmify, in its lawsuit against Cloudflare, now pending in the U.S. District Court for the Northern District of California.

As we reported previously, on February 27, 2018, the court in this case denied Swarmify’s motion for a preliminary injunction for failure to show irreparable harm.  At that time, the court commented that Swarmify’s trade secrets disclosure, produced pursuant to California Code of Civil Procedure Section 2019.210, was severely overbroad and “ever-shifting,” which the court characterized as a “blatant abuse of the system.” READ MORE →

In the Ninth Circuit, Your Fate (and Documents) May Not Be Sealed

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Judge Vince Chhabria of the Northern District of California handed down a strongly worded order denying a motion to seal alleged trade secret information, and sanctioning counsel for defendant for the frivolous request. The order is a stern reminder to the sanctioned attorneys and to trade secret litigants in federal court generally that federal litigation is traditionally a public process, and that parties seeking to remove documents from the public’s access often face an uphill battle in order to do so. READ MORE →

Mine Your Own Business: Multinational Mining Company Seeks Protection of Alleged Trade Secrets During Discovery

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Last week, multinational mining giant Rio Tinto asked a federal court in Manhattan to shield its document disclosures to the Securities and Exchange Commission (SEC) from the public eye. Unlike the typical cases we discuss involving former employees working for competitors, Rio Tinto is defending against fraud claims brought by the SEC that implicated the company and two of its former top executives. READ MORE →

Defining Trade Secrets: Texas Supreme Court May Soon Decide How Particular Trade Secrets Owners Must Be in Court

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In every trade secrets case, the plaintiff faces the same fundamental dilemma:  In order to enforce their rights in court, they must identify (at least to some degree) the trade secrets at issue. Although California has adopted a reasonable particularity requirement by statute, how much detail plaintiffs must provide when identifying their trade secrets in litigation continues to vary state-by-state.  The answer is no clearer under federal law, as the Defend Trade Secrets Act is silent as to this issue.

Notwithstanding, the level of particularity required is an ongoing issue that courts continue to grapple with.  For example, Texas’s highest court may weigh in for the first time on the degree of specificity plaintiffs must provide when identifying trade secrets allegedly misappropriated under the Texas Uniform Trade Secrets Act (TUTSA). READ MORE →

AEO Designations: A Balance Between Protecting Trade Secrets And Allowing Defendants To Defend Themselves

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Whenever a trade secret owner asserts its rights in court against a party alleged to have misappropriated the trade secret, there is always a risk that the trade secret will be publicly disclosed during discovery or during trial, thereby resulting in a further uncontrollable dissemination of the trade secret.  The owner also faces a risk that information not included in the originally misappropriated information, will be disclosed during discovery, thereby possibly giving the adversary a free peak at new information.  One way to guard against the risk of such disclosure is the use of “AEO” or Attorneys’ Eyes Only designations in litigation protective orders for highly confidential materials, which limits the parties who can review such highly confidential information to attorneys only.  But as a recent case reminded us, the right to designate documents as AEO is not automatic; this protection of the plaintiff’s trade secrets and other highly confidential materials must also be balanced against the right of defendants to assist in their own defense. READ MORE →