Univ. of Tenn. Research Found. v. Caelum Biosciences, Inc.
Univ. of Tenn. Research Found. v. Caelum Biosciences, Inc.
2023 WL 2824901 (E.D. Tenn. 2023)
February 13, 2023
Poplin, Debra C., United States Magistrate Judge
Summary
The plaintiff designated certain documents as Technical AEO, but the court found that the plaintiff had not provided sufficient evidence to show that the documents were “non-public, sensitive, technical information” and had not explained what steps it took to maintain the secrecy of the documents. The court also found that the plaintiff had not met its burden with respect to its list of trade secrets.
Additional Decisions
UNIVERSITY OF TENNESSEE RESEARCH FOUNDATION, Plaintiff,
v.
CAELUM BIOSCIENCES, INC., et al., Defendants
v.
CAELUM BIOSCIENCES, INC., et al., Defendants
No. 3:19-CV-508-CEA-DCP
United States District Court, E.D. Tennessee, Northern Division
Filed February 13, 2023
Counsel
Daniel P. Hipskind, Pro Hac Vice, Erin E. McCracken, Pro Hac Vice, Berger & Hipskind LLP, Beverly Hills, CA, Dorian S. Berger, Pro Hac Vice, Berger & Hipskind LLP, Los Angeles, CA, Wayne A. Ritchie, II, Ritchie, Dillard, Davies & Johnson, P.C., Knoxville, TN, for Plaintiff.Anna K. Finger, Pro Hac Vice, Christopher Strongosky, Pro Hac Vice, Michael David Hynes, Pro Hac Vice, DLA Piper LLP, New York, NY, John W. Elder, Lindsey M. Collins, Thomas Howard Jarvis, Paine Tarwater & Bickers LLP, Knoxville, TN, John Wellschlager, Pro Hac Vice, DLA Piper LLP, Baltimore, MD, Leeanne S. Mancari, Pro Hac Vice, DLA Piper LLP, Los Angeles, CA, for Defendant Caelum Biosciences, Inc.
Jimmie C. Miller, Hunter, Smith & Davis, Kingsport, TN, John D. Murnane, Pro Hac Vice, Zachary L. Garrett, Pro Hac Vice, Becky E. Steephenson, Pro Hac Vice, Venable LLP, New York, NY, for Defendant The Trustees of Columbia University in the City of New York.
Poplin, Debra C., United States Magistrate Judge
MEMORANDUM AND ORDER
*1 This case is before the undersigned pursuant to 28 U.S.C. § 636, the Rules of this Court, and Standing Order 13-02.
Now before the Court is Defendants' Motion to Compel Modification of Plaintiff's Confidentiality Designations, Compel the Deposition of Dr. Alan Solomon, and Modify the Scheduling Order (“Motion to Compel”) [Doc. 182]. Plaintiff filed a response in opposition to the motion [Doc. 189], and Defendants replied [Doc. 196]. The motion is ripe for adjudication.
The parties appeared before the Court on November 15, 2022, for a motion hearing. Attorneys Daniel Hipskind, Dorian Berger, and Wayne Ritchie, II, appeared on behalf of Plaintiff.[1] Attorneys John Elder, John Wellschlager, and Michael Hynes appeared on behalf of Caelum Biosciences, Inc. (“Caelum”). Attorneys Jimmy Miller and Zachary Garrett appeared on behalf of The Trustees of Columbia University in the City of New York (“Columbia”). Defendants' Motion to Compel raises two issues: (1) whether Plaintiff's designations pursuant to the Protective Order [Doc. 219] should be removed from certain documents, and (2) whether the Court should compel the deposition of Dr. Solomon.[2] The Court has adjudicated the latter issue [Doc. 224]. This Memorandum and Order addresses the former issue. For the reasons explained below, the Court GRANTS IN PART AND DENIES IN PART Defendant's motion [Doc. 182]. Specifically, the Court finds that Plaintiff has not sufficiently supported its confidentiality designations, but the Court declines to order Plaintiff to amend its list of trade secrets in response to Caelum's Interrogatory No. 1.
I. BACKGROUND
The instant dispute relates to the Protective Order that the Court entered in this case. On August 27, 2021, the parties jointly moved “for a protective order governing the confidential treatment of certain documents and information to be exchanged by the parties during discovery in this action” [Doc. 122]. For grounds, the parties explained that “discovery in this action is likely to involve [their] confidential research, development, and commercial information” [Id. at 2]. But the parties had one disagreement: the patent prosecution bar (“PPB”) [Id.]. Plaintiff argued in favor of a PPB, and Defendants opposed.
On December 22, 2021, United States Magistrate Judge Bruce Guyton entered an order agreeing that a PPB was proper in this case [Doc. 128]. Judge Guyton noted, however, that “if Defendants wish to exempt one or more attorneys on a counsel-by-counsel basis from the prosecution bar, such that those counsel would be able to both view [Plaintiff's] technical information and work on Defendants' patent prosecution ... they are able to do so” [Id. at 12]. The parties did not appeal Judge Guyton's Memorandum and Order.
Following this Memorandum and Order, Judge Guyton entered the Protective Order [Doc. 129]. The Protective Order permits the parties to designate materials “Confidential” upon “a good faith belief that the documents, information or material contains confidential or proprietary information or trade secrets of the Party or a Third Party to whom the Party reasonably believes it owes an obligation of confidentiality with respect to such documents, information, or material [Id. ¶ 6]. Parties may also invoke the “Restricted Attorneys Eyes Only” designation, which is “so sensitive that its dissemination deserves even further limitation” [Id. ¶ 8]. Finally, the Protective Order allows the parties to designate materials as “Technical Restricted Attorneys' Eyes Only” meaning that the material “contains non-public, sensitive technical information, including laboratory data, clinical trial data, or information of a scientific of technical nature” [Id. at 6 n. 2]. Specifically, paragraph 11 states as follows:
*2 Any counsel representing a Party, whether in-house or outside counsel, and any person associated with a Party and permitted to receive the other Party's Protected Material that is designated TECHNICAL RESTRICTED -- ATTORNEYS' EYES ONLY who obtains, receives, has access to, or otherwise learns, in whole or in part, the other Party's TECHNICAL RESTRICTED -- ATTORNEYS' EYES ONLY under this Order shall not prepare, prosecute, supervise, or assist in the preparation or prosecution of any patent application pertaining to the field of genetically engineering monoclonal antibodies or production of monoclonal antibodies during the pendency of this Action and for one year after its conclusion, including any appeals. To “prepare, prosecute, supervise or assist in the preparation or prosecution of a patent application” under this prosecution bar (i.e., the prohibited activities) shall mean: (1) prepare and/or prosecute any patent application (or portion thereof), whether design or utility, and either in the United States or abroad on behalf of a patentee or assignee of patentee's rights; (2) prepare patent claim(s) on behalf of a patentee or assignee of patentee's rights; (3) participate in any reissue proceedings on behalf of a patentee or assignee of patentee's rights; or (4) provide advice, counsel or suggestions regarding, or in any other way influencing, claim scope and/or language, embodiment(s) for claim coverage, claim(s) for prosecution, or claim coverage for products or processes on behalf of a patentee or assignee of patentee's rights.
[Id. ¶ 11]. Further, paragraph 17 discusses how to challenge designations and provides as follows:
A Party may request in writing to the other Party that the designation given to any DESIGNATED MATERIAL be modified or withdrawn. If the designating Party does not agree to redesignation within ten (10) days of receipt of the written request, the requesting Party may apply to the Court for relief. Upon any such application to the Court, the burden shall be on the designating Party to show why its classification is proper. Such application shall be treated procedurally as a motion to compel pursuant to Federal Rules of Civil Procedure 37, subject to the Rule's provisions relating to sanctions. In making such application, the requirements of the Federal Rules of Civil Procedure and the Local Rules of the Court shall be met. Pending the Court's determination of the application, the designation of the designating Party shall be maintained.
[Id. ¶ 17].
In the instant matter, Plaintiff has designated material as Technical Restricted Attorneys' Eyes Only (“Technical AEO”), and Defendants move the Court to redesignate the materials to confidential. Specifically, Plaintiff has designated Technical AEO: (1) The Stability Report, (2) The ELISA Assay Protocol, and (3) Ch11-1F4 Biopharmaceutical Development Program Project 549 Summary Report (“Project Summary Report”).[3] Defendants argue that Plaintiff cannot establish good cause for its AEO designations, “let alone justify the additional application of the [PPB] by designating the documents Technical AEO” [Doc. 202 p. 17]. Defendants argue that Plaintiff will not suffer any injury from disclosure to at least Defendants' in-house counsel and retained experts with removal of the PPB designation. In addition, Defendants state that Plaintiff has designated the three documents as Technical AEO, despite these documents already being in Defendants' possession. Thus, Defendants assert, there is no harm in disclosing that information to them now. Defendants further argue that the burden imposed on them by the Technical AEO designation outweighs any potential harm to Plaintiff from the redesignation of the above documents. For instance, Defendants maintain Plaintiff's designations prevent them from discussing the alleged trade secrets that Defendants have allegedly misappropriated with their clients respective in-house counsel and that finding an expert is difficult in light of the PPB.
In a similar vein, Defendants assert that Plaintiff should amend paragraphs 16–21 in its supplemental response to Interrogatory No. 1. Specifically, Interrogatory No. 1 requests that Plaintiff identify the trade secrets that Defendants misappropriated. Plaintiff redacted the information designated as Technical AEO, but Defendants assert such information has been extracted from Columbia's documents. Defendants state that if the redacted information is truly Plaintiff's proprietary information, then Plaintiff must be able to produce its own documents reflecting such. Otherwise, according to Defendants, the only source of the redacted information is a Columbia-produced document. Thus, Defendants request that Plaintiff amend its supplemental/redacted responses to either (1) cite an alternative source for the redacted information and modify the supplemental/redacted response to remove the associated redactions, or (2) delete ¶¶ 16–21 from Plaintiff's list of purported trade secrets [Id. at 25].
*3 Plaintiff responds that it properly designated documents as Technical AEO. According to Plaintiff, Defendants have regurgitated the arguments that they presented to Judge Guyton, which he denied, and they did not appeal. Plaintiff states that Defendants have not provided any support for their claim that experts are unwilling to help Defendants in light of the PPB and that their issue appears to be with the inclusion of the Technical AEO category in the Protective Order. Even assuming that Defendants have not waived this argument, Plaintiff asserts that Defendants' arguments fails because it properly designated documents that qualify as Technical AEO. Plaintiff denies that it must establish good cause for the level of protection selected and describe the harm it will sustain. Instead, according to Plaintiff, “the standard in this district, that an AEO designation is appropriate ‘when especially sensitive information is at issue or the information is to be provided to a competitor’ ” [Doc. 201 p. 17 (citing Diamond Resorts U.S. Collection Dev., LLC v. Wesley Fin. Grp., LLC, No. 3:20-CV-251-DCLC-DCP, 2021 WL 8443797, at *8 (E.D. Tenn. July 20, 2021))]. Plaintiff concludes that the Stability Report, the ELISA Assay Protocol and the Project Summary Report are all properly designated as Technical AEO.
With respect to its supplemental response to Interrogatory No. 1, Plaintiff asserts that Columbia designated the same information as Technical AEO. Plaintiff claims that Defendants' remaining arguments are premature merits-based arguments in the guise of a Protective Order dispute, but to the extent the Court considers such arguments, Plaintiff has established it owns the trade secrets.
Defendants deny that they are asserting a belated objection to Judge Guyton's Memorandum and Order, but instead, they are challenging Plaintiff's designations pursuant to section 17 of the Protective Order. In considering such challenges, Defendants argue “that the Court shoulder consider the balance of harms in analyzing the propriety of [Plaintiff's] confidentiality designations” [Doc. 204 p. 5 (other citation omitted)]. Defendants maintain that Plaintiff's Technical AEO Designations are unjustified, claiming that Plaintiff has not set forth proof of what constitutes its trade secrets given that its supplemental responses have not been verified. But even if Plaintiff verified its supplemental response, Defendants argue that Plaintiff's “description of its efforts to maintain the secrecy of the alleged trade secrets is identically conclusory” [Id. at 8 (citation omitted)].
With respect to Plaintiff's supplemental response to Interrogatory No. 1, Defendants claim Plaintiff's alleged trade secret is nothing more than a label, and the Columbia-document that Plaintiff relies on has been redesignated by Columbia as Restricted AEO.
II. ANALYSIS
The Court has considered the parties' arguments and the oral presentations at the hearing, and for the reasons explained below, the Court GRANTS IN PART AND DENIES IN PART Defendants' motion [Doc. 182]. The Court finds that Plaintiff has not established that The Stability Report, The ELISA Assay Protocol, the Project Summary Report, and its list of alleged trade secrets in response to Interrogatory No. 1 warrant a Technical AEO designation. The Court, however, declines to order Plaintiff to amend its trade secret list in response to Caelum's Interrogatory No. 1.
As initial matter, Plaintiff asserts that Defendants have waived any challenges to the Protective Order by not filing an objection to Judge Guyton's Memorandum and Order [Doc. 128]. Defendants, however, represent that their motion is not an objection to Judge Guyton's ruling and is merely a challenge pursuant to paragraph 17 of the Protective Order [Doc. 129]. In light of Defendants' representation, the Court will not consider whether the Protective Order should be modified. Thus, the primary question before the Court is simply whether Plaintiff's Technical AEO designations are appropriate.[4]
*4 Here, the parties entered a blanket protective order, although they disputed the PPB provision. “A blanket protective order allows the parties to designate certain information as confidential without the need for the Court to review each piece of information before that designation.” N.T. by & through Nelson v. Children's Hosp. Med. Ctr., No. 1:13CV230, 2017 WL 3314660, at *5 (S.D. Ohio Aug. 3, 2017) (citation omitted). Similar to many blanket protective orders, the burden is on the designating party to justify the designation [Doc. 129 ¶ 17]. Accord Brown v. Tellermate Holdings Ltd., No. 2:11-CV-1122, 2014 WL 2987051, at *22 (S.D. Ohio July 1, 2014) (“As the producing party, Tellermate had the burden of demonstrating entitlement to the designation.”), adopted as modified, No. 2:11-CV-1122, 2015 WL 4742686 (S.D. Ohio Aug. 11, 2015)). Any application to challenge a confidentiality designation “shall be treated procedurally as a motion to compel pursuant to Federal Rules of Civil Procedure” [Doc. 129 ¶ 17.]. The parties agreed to invoke designations only good faith [Id. at ¶ 6].
The Court notes that the issue before it is certainly unique given that much of the information Plaintiff designated Technical AEO is in Defendants' possession or produced by Defendants [See, e.g., Doc. 202 p. 18 (“Caelum already has possession of the data reflected in [The Stability Report]”); Doc. 202 p. 19 (explaining that Plaintiff admits that identical information in the ELISA Assay Protocol can be found in the documents that Columbia produced); Doc. 202 p. 22 and Doc. 204 p. 10 (noting that Defendants already have the Assay Profile and Milestone Reports contained in the Project Summary Report and that Defendants have had much of the information in the Project Summary Report for over five years)]. Plaintiff does not dispute this point [Doc. 212 p. 12].
Even so, however, the Protective Order places the burden on Plaintiff, the designating party, to establish that the designations are appropriate. As outlined above, the Protective Order establishes three designations: (1) confidential, (2) AEO, and (3) Technical AEO. Confidential documents contain “confidential or proprietary information or trade secrets of a party or third party to whom the party reasonably believes it owes an obligation of confidentiality with respect to such documents, information or materials” [Doc. 129 ¶ 6]. AEO is information that “is so sensitive that its dissemination deserves even further limitation” [Id. ¶ 8]. Technical AEO means that the information is “non-public, sensitive, technical information, including laboratory data, clinical trial data, or information of a scientific or technical nature” [Id. ¶ 11 n.2]. Plaintiff argues that The Stability Report, the ELISA Assay Protocol, and the Summary Report, and its list of trade secrets in response to Interrogatory No. 1 are appropriately designated as Technical AEO.
The Court finds that Plaintiff has not established that its designations are appropriate pursuant to the Protective Order. Plaintiff asserts that “[w]here that qualifying information is technical information, including laboratory data, clinical trial data, or other information of a scientific or technical nature, the Technical AEO designation applies” [Doc. 201 p. 17]. But Plaintiff's assertion omits the first criteria of Technical AEO—that is, “non-public, sensitive technical information” [Doc. 129 at 6 n. 2]. In other words, simply because a document contains “laboratory data, clinical trial data, or information of a scientific or technical nature” does not make such information Technical AEO.[5] Here, the Court finds that there is not sufficient evidence in the record establishing that the documents are “non-public, sensitive, technical information.”
*5 In support of its designations, Plaintiff states that it has “maintained the secrecy of the Stability Report pursuant to the efforts that far exceed the applicable standard, which constitute reasonable efforts under the circumstances” [Doc. 201 p. 18 (citation omitted)]. Plaintiff offers the same reason in support of its designations of the ELISA Assay Report and the Project Summary Report [Doc. 201 pp. 21 and 23]. Plaintiff relies on its response to Interrogatory No. 9 to Columbia's First Set of Interrogatories to support this assertion [Doc. 189-4 SEALED]. Interrogatory No. 9 asks Plaintiff to describe the steps it took to maintain the secrecy of all its alleged trade secrets [Id. at 55 SEALED]. But in reviewing Plaintiff's response, the Court cannot discern how the Stability Report, the ELISA Assay Report, and the Project Summary Report warrant a Technical AEO designation. The response does not specifically identify several of the documents at issue here. Even so, Plaintiff does not explain what steps it took to maintain this secrecy, what is the applicable standard, or how its efforts exceed the applicable standard. Thus, it remains unclear to the Court what specific reasonable efforts Plaintiff took to maintain the secrecy of the Stability Report, ELISA Assay Report, and the Project Summary Report under the circumstances.[6] Plaintiff's response is not sufficient to support the Technical AEO designations.
With respect to Plaintiff's list of trade secrets in response to Interrogatory No. 1, the Court also finds that it has not met its burden for similar reasons.[7] Other than its assertion that the list contains trade secrets, Plaintiff does not put forth any basis to retain its Technical AEO designation. Trade secrets alone do not warrant a restrictive designation. Penn, LLC v. Prosper Bus. Dev. Corp., No. 2:10-CV-0993, 2012 WL 5948363, at *4 (S.D. Ohio Nov. 28, 2012) (“The mere presence of “trade secrets” does not automatically entitle the producing party to an AEO protective order. The burden remains on the producing party to show that AEO protection is warranted.”). The Protective Order in this case states that a party may designate their trade secrets as confidential [Doc. 129 ¶ 6]. Thus, Plaintiff must show why a more restrictive designation is appropriate, and the Court finds it has not done so.
Finally, Defendants assert that certain information should be removed from Plaintiff's list of trade secrets given that Plaintiff did not cite information from its own document production. The Court finds their argument goes to the merits of this case and is not appropriate for a motion to compel. Yoe v. Crescent Sock Co., No. 1:15-CV-3-SKL, 2017 WL 11479991, at *7 (E.D. Tenn. May 25, 2017) (“Parties asserting a trade secret allegation, however, are not required – during discovery – to establish the existence of a trade secret by a preponderance of the evidence.”).[8]
V. CONCLUSION
For the reasons explained below, the Court GRANTS IN PART AND DENIES IN PART Defendants' Motion to Compel Modification of Plaintiff's Confidentiality Designations [Doc. 182]
IT IS SO ORDERED.
ENTER:
Footnotes
Attorneys Hipskind and Berger also appeared on behalf of Dr. Solomon.
In addition, Defendants originally requested that the Court modify the deadlines in the Scheduling Order, but they later withdrew this request [Doc. 198].
These documents are under seal as [Docs. 184-3, 184-4, and 184-10 SEALED].
The parties dedicate a significant portion in their briefs arguing whether Defendants' challenge is a belated objection to Judge Guyton's Memorandum and Order [Doc. 128]. In his Memorandum and Order, Judge Guyton noted that the information that the parties intended to exchange is the “kind of information that triggers patent prosecution bars” [Id. at 11]. Given that both parties have since designated information as Technical AEO, [see Doc. 201-1 ¶ 2], there does not appear to be a dispute that this case does involve confidential, sensitive information, which justifies Judge Guyton's Memorandum and Order [Doc. 128]. However, the issue before the Court is not whether the case involves confidential, sensitive information but whether specific documents warrant the most restrictive designation pursuant to the parties' Protective Order [Doc. 129].
Further, to the extent Plaintiff argued at the hearing that the parties negotiated the Protective Order, other than the PPB, this does not change the Court's analysis [Doc. 212 pp. 20–21]. Penn, LLC v. Prosper Bus. Dev. Corp., No. 2:10-CV-0993, 2012 WL 5948363, at *5 (S.D. Ohio Nov. 28, 2012) (disagreeing with the defendant's argument that the plaintiff should be held to the negotiated terms of the protective order explaining that the terms of the protective order allow the parties to challenge AEO designations).
The Court observes that given the nature of this case, if Technical AEO was defined as simply laboratory data, clinical trial data, or information of a scientific or technical nature, then most of the discovery in this case would likely warrant the most restrictive designation.
The Court observes that Plaintiff refers to certain confidentiality agreements in its response to Interrogatory No. 9, but such agreements were with Columbia [Doc. 189-4 pp. 56–61 SEALED].
The Court notes, however, that Columbia has designated this information as AEO [Doc. 201 p. 12].
The Court addressed a similar argument in its Memorandum and Order entered on July 13, 2022 [Doc. 179 p. 4 n.2].