Free Motion for Protective Order - District Court of Colorado - Colorado

Case 1:04-cv-00617-LTB-BNB

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Filed 09/19/2005

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 04-B-0617 (BNB) POLYROCK TECHNOLOGIES, LLC, a Colorado limited liability company, Plaintiff, v. GENERAL STEEL DOMESTIC SALES, LLC, et al. Defendants. DEFENDANTS' JOINT MOTION FOR PROTECTIVE ORDER Defendants General Steel Domestic Sales, LLC, Genstone Enterprises, LLC, Jeff Knight and Charles Demarest (collectively hereinafter "Defendants"), by and through their respective counsels, hereby bring this Joint Motion for Protective Order pursuant to Fed.R.Civ.P. Rule 26(c) and request the Court enter an order that discovery not be had to protect the Plaintiffs from undue burden and expense and oppression. As grounds therefore Defendants state as follows: CERTIFICATE OF COMPLIANCE WITH LOCAL RULE 7.1 DEFENDANTS HAVE CONFERRED IN GOOD FAITH WITH COUNSEL FOR THE PLAINTIFF REGARDING THE ISSUES RAISED HEREIN BUT HAVE BEEN UNABLE TO REACH RESOLUTION. FACTS 1. Plaintiff filed its initial complaint on March 29, 2004. In this initial complaint, Plaintiff alleged that Defendants infringed U.S. Patent No. 6,607,683 ("the `683 patent"), assigned

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to Plaintiff, which discloses "Methods and Apparatus for Producing Manufactured Articles Having Natural Characteristics." A copy of the `683 patent is attached hereto as Exhibit A. The `683 patent was published in August of 2003. It contains 14 claims, all of which are method claims relating to "methods and apparatus for producing manufactured articles or reproductions with characteristics of natural articles." Col. 2, Lines 56-58. Plaintiff did not serve this initial complaint on Defendants, which prompted the Court to issue a Notice to Show Cause why the complaint should not be dismissed. 2. Plaintiff responded to the Notice to Show Cause and eventually served its First Amended Complaint on May 6, 2005. Notably, Plaintiff dropped its claim for patent infringement, yet it kept its claim for violation of the Uniform Trade Secrets Act ("UTSA"). In support of its UTSA claim, Plaintiff attached documents signed by Defendants Kissire and Demarest in 2002, alleged to be non-disclosure agreements. 3. Plaintiff asked the Court for leave to amend its complaint again on July 19, 2005, which was granted the following day. This Second Amended Complaint included the same claims for relief, still absent a claim for patent infringement. Plaintiff's Second Amended Complaint begins, "This is an action to protect the intellectual property rights of plaintiff PolyRock Technologies, LLC in its proprietary technology for the production of molded polyurethane siding or building panels that realistically replicate, at significantly reduced cost, the appearance, color and texture of stone, brick and other natural building materials (the "Proprietary Technology"). The Proprietary Technology includes, among other things, a simple and economical process for manufacturing lightweight panels that closely resemble stone or brick masonry." Amend. Compl. § 1. Plaintiff later alleges

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"PolyRock's predecessors disclosed the manufacturing process to Demarest, Kissire and Knight (separately and together, each on one or more occasions) and also provided them with confidential financial and business information." Amend. Compl. § 23. ARGUMENTS 4. The definition of Plaintiff's Proprietary Technology set forth in its Second Amended Complaint appears to Defendants to be identical to the subject matter disclosed in the `683 patent. Plaintiff defines its Proprietary Technology in the Second Amended Complaint as a "process for manufacturing," which is exactly what Plaintiff disclosed and claimed in the `683 patent. Plaintiff also alleged in its Amended Complaint that it owns the `683 patent "and other U.S. and foreign patent applications relating to aspects of the Proprietary Technology." Amend. Compl. § 11. Defendants have now located a copy of the referenced foreign patent, a copy of which is attached hereto as Exhibit B. It is European Patent application EP0985507, which has a publication date of March 15, 2000. Although counsel for Plaintiff has repeatedly asserted that the method and

apparatus of the `683 patent was unpublished until 2003, that contention is belied by the European Patent application, which has the identical title, drawings and specifications as the `683 patent. It is therefore indisputable that Plaintiff voluntarily placed the method and apparatus later disclosed by the `683 patent into the public domain prior to the time that it allegedly disclosed its trade secrets relating to the same process to Defendants in 2002. As such, no part of those 2002 disclosures which are included in the patent can be considered trade secrets under the UTSA because they occurred after the date of publication. Colo. Rev. Stat. 7-74-102(4).

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5. Plaintiff also claims that it disclosed "confidential financial and business information" to certain Defendants. Amend. Compl. § 23. However, the documents produced by Plaintiff and signed by Defendants Kissire and Demarest unambiguously define the confidential subject matter as "information relating to the development and manufacturing" of Plaintiff's products. Amend. Compl. § 22. Nowhere do the two documents produced by Plaintiff state anything about confidential financial and business information. Therefore, the two Defendants who signed the documents were under no duty to keep confidential matters they observed which fell outside of the scope of the subject matter described by the documents themselves. 6. Plaintiff has not identified with any greater specificity than it has in the Second Amended Complaint precisely what it claims its trade secret to be, despite the request of Defendants' counsels that it do so. At best, counsel for Plaintiff has verbally described the trade secret as being composed of three categories: (a) the combination of every step in the entire manufacturing process observed by the Defendants in 2002, (b) additional trade secrets not included in the `683 patent (e.g. the method for coloring its artificial stone products) and (c) financial and economic data related to plaintiff's manufacturing process. 7. Based on their review of the European patent, defendants contend that category (a) is not a trade secret, because it was previously published in the European patent in 2000, as has been addressed already in detail above. Also as discussed above, category (c) was not part of the subject matter Plaintiff alleges the two Defendants agreed to by signing the alleged non-disclosure agreements and thus cannot support a UTSA claim. That leaves

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category (b), characterized as additional trade secrets not included within the patents, which Plaintiff has refused to disclose in any way with the exception of its colorization process. This failure and refusal to define its trade secrets with specificity is what has caused the difficulty facing Defendants in responding to the Plaintiff's discovery requests. Because plaintiff has not provided any specific description of what the

additional trade secrets are that are not part of the `683 patent, other than the process of adding color to the artificial stone products, (which in fact is also disclosed in the European patent and the `683 patent), Defendants simply cannot determine the specific nature of Plaintiff's alleged trade secrets. Without further specifying or identifying what trade secret existed in 2002 that was not disclosed by publication of Plaintiff's European Patent application, it is impossible to identify the scope of Plaintiff's UTSA claim. 8. It is well-established law that discovery requests that are overbroad, ambiguous or otherwise do not describe the request with reasonable particularity are objectionable and regularly stricken. St. Paul Reinsurance Co., Ltd. v. Commercial Financial Corp., 198 F.R.D. 508, 514 (N.D.Iowa 2000). See also, Jewish Hospital Ass'n of Louisville,

Kentucky, Inc. v. Struck Construction Co., Inc., 77 F.R.D. 59, 60 (W.D.Ken. 1978). In addition, parties are not required to answer interrogatories that call for legal conclusions. Jewish Hospital Ass'n, 77 F.R.D. at 60. 9. Courts have also commented on the requisite specificity before making a determination on responsiveness to discovery requests. See Carlson v. Freightliner LLC, 226 F.R.D. 343 (D.Neb.2004); Leucadia, Inc. v. Intermas Nets USA, Inc., 2003 WL 366590 (D.Minn.2003) (unpublished opinion) (discovery sought information on competing

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products that did not involve trade secrets). In Carlson, the court stated, "The failure to `identify the trade secrets with sufficient specificity renders the Court powerless to enforce any trade secret claim.'" 226 F.R.D. at 364. Because Plaintiff has failed to provide even the slightest amount of specificity in the pleadings or upon subsequent requests by Defendants in preparing their responses, Defendants are unable to determine whether the information sought has even the slightest bearing on the Plaintiff's claims for misappropriation of trade secrets. 10. In discovery, Plaintiff makes overly broad requests for information concerning "any process or method...by which General Steel, Genstone or any person or entity acting for or on behalf of either of them, has ever manufactured or produced any product made from polyurethane or including polyurethane as an ingredient and designed, intended or marketed as achieving the look of rock, stone, stucco or brick." See Exhibit C, Plaintiff's First Combined Discovery Requests to Defendants General Steel, Genstone and Knight, Interrogatory No. 2. Plaintiff has made similar overbroad requests to defendant

Demarest, asking, e.g., that defendant Demarest identify "any products" that he has designed or manufactured that contain polyurethane and are designed or intended as achieving the look of rock, stone, stucco or brick. See,Exhibit D, Plaintiff's First

Combined Discovery Requests to Defendant Demarest, Interrogatory No. 2. 11. These requests are extremely overbroad given the fact that they ask about every product relating to polyurethane siding products, without regard to whether those products related in any way to the alleged theft of Plaintiff's alleged, but undisclosed trade secrets.1
1

Defendants concede that Plaintiff is entitled to discovery specifically related to polyurethane foam wall panels manufactured by Defendant Demarest in 2003 pursuant to a contract with Defendant GenStone, which contract was
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These open-ended and unlimited requests are repeated almost verbatim in other interrogatories and also in Plaintiff's Requests for Production. Specifically, with regard to Defendants General Steel, GenStone and Knight, the objectionable discovery is found in Exhibit C, Interrogatory Nos. 1-4 and 6-9, and in Requests for Production Nos. 4, 6, 810, 12-18, and 20. With regard to Defendant Demarest, the objectionable discovery is found in Exhibit D, Interrogatory Nos. 1-4 and 6-7, and in Requests for Production Nos. 6, 7, 9, 12, 13, 14, 16-20, and 22. 12. The information sought by these discovery requests is overbroad, ambiguous, and not relevant to Plaintiff's UTSA Act claim because: (a) the information relates to the subject matter of the `683 patent, which was voluntarily published with the European Patent Office (App. No. EP0985507) on March 15, 2000, over two full years prior to any disclosure to Defendants; and (b) Defendants cannot divine at this point what Plaintiff's alleged trade secrets were composed of in 2002. 13. In the first instance, the subject matter of Plaintiff's method and apparatus was not a trade secret at the time it was disclosed to the Defendants, and is therefore not relevant to Plaintiff's claim brought under the UTSA. In the second instance, if the Defendants were made aware of confidential information that is protectable as a trade secret during their 2002 meetings with Plaintiff, they have had no notice of what those trade secrets were. By making overly broad and ambiguous discovery requests, Plaintiff puts Defendants at a serious risk of producing information (to a competitor) that is completely irrelevant to any of their claims, and which may in and of itself be protected by various trade secrets.
terminated in August of 2003 (hereinafter the "GenStone Project"). Defendants have provided discovery responses and Rule 26 disclosures related to the GenStone Project and do not seek a protective order for such matters.
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This will cause Defendants great prejudice.

To require responses to the requests

enumerated in paragraph 11 would cause greater harm to Defendants than it would benefit Plaintiff, especially where the burden of specifying the trade secrets of Plaintiff is so small. WHEREFORE, Defendants request that the Court grant their Motion for Protective Order pursuant to Fed.R.Civ.P. 26 and 33 with respect to the discovery requests specified in ¶ 11 above, and order that discovery not be had to protect Defendants from undue burden and expense and oppression, and for such further and other relief as the Court deems just and proper. DATED: September 19, 2005 Respectfully submitted, {Original signature on file at Lewis Scheid LLC} Kurt S. Lewis Attorneys for General Steel, Genstone and Jeff Knight Lewis Scheid, LLC 2300 15th Street, Suite 320 Denver, CO 80202 Telephone: 303-534-5040 Facsimile: 303-534-5039 Email: [email protected] {Original signature on file at Pendleton, Friedberg, Wilson & Hennessey, P.C.} ________________________________________________ Susan M. Hargleroad Attorneys for Charles Demarest Pendleton, Friedberg, Wilson & Hennessey, P.C. 1875 Lawrence St., 10th Floor Denver, CO 80202 Telephone: 303-839-1204 Facsimile: 303-831-0786 Email: [email protected]

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CERTIFICATE OF SERVICE
I hereby certify that on this 19th day of September, 2005, I electronically filed the foregoing DEFENDANTS' JOINT MOTION FOR PROTECTIVE ORDER with the Clerk of court using the CM/ECF system which will send notification of such filing to the following email addresses:

John A. DeSisto E-mail: [email protected] Susan M. Hargleroad E-mail: [email protected]

{Original signature on file at Lewis Scheid LLC} ________________________________________ Kurt Lewis Lewis Scheid LLC Attorney for Defendants General Steel, Genstone and Jeff Knight

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