FemtoMetrix, Inc. v. Huang
FemtoMetrix, Inc. v. Huang
2023 WL 6786776 (C.D. Cal. 2023)
September 8, 2023
Scott, Karen E., United States Magistrate Judge
Summary
The Court ordered Plaintiff to provide a chart to identify the allegedly misappropriated trade secrets within each document type, and to identify each document that is (or contains) an allegedly misappropriated trade secret by BATES number. The Court also ordered Plaintiff to produce the data in an orderly, organized fashion and to identify and/or produce a complete list of the selection of parts, design documents, and suppliers for the components alleged to comprise the trade secret.
FEMTOMETRIX, INC.
v.
CHONGJI HUANG, et al
v.
CHONGJI HUANG, et al
Case No. 8:22-cv-01624-CJC-KES
United States District Court, C.D. California
Filed September 08, 2023
Scott, Karen E., United States Magistrate Judge
PROCEEDINGS (IN CHAMBERS): ORDER GRANTING Defendants' Motion to Compel Sufficient Trade Secret Disclosures [Dkt. 90]
*1 Before the Court is a motion filed by Defendants Chongji Huang, Puxi Zhou, Weiwei Zhao, and Weichong Semiconductor Group (“Defendants”) to compel Plaintiff FemtoMetrix, Inc. (“Plaintiff”) to identify its allegedly misappropriated trade secrets with reasonable particularity. (Dkt. 90.) Defendants challenge the sufficiency of Plaintiff's July 2023 First Supplemental Trade Secret Disclosure (“1S-TSD”) filed under seal at Dkt. 89-4.
Plaintiff opposed the motion (Dkt. 102) and Defendants replied (Dkt. 105). The Court held a hearing on September 7, 2023. (Dkt. 108.) For the reasons stated herein, Defendants motion is GRANTED.
First, the parties agree that Plaintiff must identify its allegedly misappropriated trade secrets with reasonable particularity, regardless of whether that duty arises under Cal. Code. Civ. P. § 2019.210 or federal discovery rules, because Defendants propounded Interrogatory 1 asking Plaintiff to identify its allegedly misappropriated trade secrets.
The 1S-TSD lists six categories of trade secrets. For each category, there is a (1) general narrative description and (2) list of documents identified by BATES number and designated Attorneys' Eyes Only (“AEO”). Plaintiff does not contend that the narrative description, standing alone, would be sufficient to identify the allegedly misappropriated trade secrets. Rather, Plaintiff relies on the listed AEO documents to identify the claimed trade secrets.
The parties provided some of the listed documents to the Court on a thumb drive, and the Court reviewed many of the documents in connection with reading the expert declarations submitted in support of and in opposition to the motion. Defendants' expert, Dr. Minn, declares that he reviewed the documents and cannot discern what Plaintiff contends constitute its trade secrets. He gives examples from the listed documents that include emails discussing scheduling of calibration with no technical information about calibration, documents showing the use of commercially available software that do not shed light on what aspects of the software might be proprietary, draft design documents that do not appear to reflect final design specifications, etc. (Dkt. 90-2, Dkt. 105-2.)
Plaintiff counters that Dr. Minn is unqualified in the relevant field, and that its expert, Dr. James, was able to discern all the allegedly misappropriated trade secrets from the listed documents. (Dkt. 102-1.) Dr. James, however, does not list or describe the trade secrets he discerned. (Id.) The Court finds that both expert declarations are admissible and accords them appropriate weight according to the declarants' qualifications and how well they supported their testimony.
At the hearing, Plaintiff argued that so long as a qualified expert, Dr. James, declared that he could discern the trade secrets from the documents (without actually describing the trade secrets), Plaintiff had satisfied its obligation. The Court disagrees.
Certainly, a plaintiff can rely on documents to identify its trade secrets with reasonable particularly. See Forro Precision, Inc. v. Int'l Bus. Mach. Corp., 673 F.2d 1045, 1057 (9th Cir. 1982) (finding a protectable trade secret “in the form of engineering drawings and blue prints”). But this is not a case where Plaintiffs have generally described their trade secrets as “engineering drawings and blue prints” and then pointed to documents that are engineering drawings and blue prints.
*2 Rather, looking at the first category, Plaintiff claims a trade secret in calibration “settings or ‘recipes,’ ” but then lists documents that do not contain calibration settings or recipes. (Dkt. 89-4 at 64.) At the hearing, Plaintiff's counsel expressed doubt that any documents comprehensively stating the calibration recipes exist, but if that's so, then Plaintiff must describe the calibration recipes narratively to identify the claimed trade secret and not merely rely on documents.
Similarly, Plaintiff claims a trade secret in “tool design and part selection,” but the referenced documents are neither tool design drawings nor parts lists. (Id. at 67.)
Plaintiff claims a trade secret in the Corona Gun “module,” but does not identify what components, parts, software, etc. make up the “module.” (Id. at 72.) As a result, the Court finds persuasive Dr. Minn's testimony that he is unable to discern what aspects of the Corona Gun are allegedly trade secrets, as opposed to technology protected by Plaintiff's Corona Gun-related patents.
In categories 4 and 5, Plaintiff claims a trade secret in data related to the Harmonic F-series, as well as methods of collecting that data and methods of processing that data, such as software, models, and algorithms. (Id. at 73-70.) But the “data” at issue is not identified sufficiently through the listed documents. The software, models, and/or algorithms are identified neither by name nor by narrative description.
Category six is a “catchall” category for “technical specifications” set forth in various documents described to be of the following general kinds: “(1) 3D Schematics; (2) Customer Requirement & Goals; (3) Data Collection / Reports; (4) Engineering Bill of Materials (BOM); (5) Images of Tool, Parts, Sub-systems Laboratory Notes; (6) Manufacturing Instructions; (7) Maintenance Procedures; (8) Roadmaps for Projects; (9) Software Code & Programs; (10) Spec. Sheets for Components; and (11) Technical Drawings.” (Id. at 81.) Dr. Minn reviewed Plaintiff's listed documents looking for these kinds of documents and declared that he did not find them; “the documents referred to have not been produced.” (Dkt. 89-2 ¶ 54.)
For these reasons, for good cause shown and in order to inform the relevant scope of discovery and expert analysis, the Court hereby GRANTS Defendant's motion. The Court orders Plaintiff to provide, within 14 days, a second supplemental trade secret disclosure identifying its alleged trade secrets with reasonable particularity, providing for each alleged trade secret sufficiently detailed information to distinguish the subject information from general knowledge or knowledge of skilled persons in the relevant fields of technology.
1. With respect to Alleged Trade Secret 1, the Court orders Plaintiff to describe the entire scope of the Harmonic F-Series alignment and calibration techniques, recipes, and/or processes that Plaintiff claims to be its trade secret(s), making clear each step of each claimed processes.
2. With respect to Alleged Trade Secret 2, the Court orders Plaintiff to identify and/or produce a complete list of the selection of parts, design documents, and suppliers for the components alleged to comprise this trade secret.
3. With respect to Alleged Trade Secret 3, the Court orders Plaintiff to describe any allegedly secret “manner of use” of the Corona Gun; identify all “design, calibration, and application in surface metrology” techniques for using the Gun claimed as trade secrets; and provide sufficient information to distinguish the alleged trade secrets from prior art and Plaintiff's patent disclosures.
*3 4. With respect to Alleged Trade Secret 4, the Court orders Plaintiff to identify data alleged to be trade secret by file name (either a computer file name or BATES number), and to provide a narrative description, including how the data is used. Plaintiff must produce the data in an orderly, organized fashion so that any documents relied upon to disclose the data can be easily correlated with the descriptions provided.
5. With respect to Alleged Trade Secret 5, the Court orders Plaintiff to describe the allegedly trade secret data processing techniques and state which software implements the processing techniques. To identify trade secret software, Plaintiff shall provide a computer file name (or state that none exists, in which case Plaintiff shall state the directory, folder, and/or file locations where the software can be found), describe the form of the software (e.g., original source code, a script that runs over commercially available software, etc.), and describe what the software does.
8. With respect to Alleged Trade Secret 6, the Court orders Plaintiff to provide a chart to identify the allegedly misappropriated trade secrets within each document type: “(1) 3D Schematics; (2) Customer Requirement & Goals; (3) Data Collection / Reports; (4) Engineering Bill of Materials (BOM); (5) Images of Tool, Parts, Sub-systems Laboratory Notes; (6) Manufacturing Instructions; (7) Maintenance Procedures; (8) Roadmaps for Projects; (9) Software Code & Programs; (10) Spec. Sheets for Components; and (11) Technical Drawings.” Each document that is (or contains) an allegedly misappropriated trade secret and that is also one of these document types shall be identified in the chart by BATES number. The chart must also contain a description (either for each document or for groups of documents, if logically appropriate) stating what about the documents is the claimed trade secret.
Defendants asked the Court to order that Plaintiff not be permitted to further supplement its trade secret identification after its second supplemental disclosure without a noticed motion establishing good cause and a lack of undue delay. The Court declines to order such relief now. As the parties' briefs made clear, Plaintiff is still conducting discovery to learn the extent of the alleged theft of proprietary documents by its former employees. Information learned during discovery may provide Plaintiff with a good reason for later supplementing its trade secret disclosures. The Court need not decide that issue now, and the Court expects the parties to meet and confer in good faith about any proposed supplementation.
To the extent this Minute Order repeats general descriptions from the 1S-TSD, the parties' briefs, or evidence filed under seal, the Court has independently determined that there is no “good cause” to seal any information in this Minute Order.
MINUTES FORM 11