Free Redacted Document - District Court of Delaware - Delaware

Case 1:04-cv—OO904-KAJ Document 115 Filed O9/29/2005 Page 1 of 2
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September 28, 2005
VIA E-FILING
The Honorable Kent A. Jordan PUBLIC VERSION
U.S. District Court for the District of Delaware
844 North King Street
Wilmington, Delaware l980l
Re: STATUS REPORT
WC. Herczeus GMBH & C0, KG, et al. v. ll/Imjorie Joy Lynn, et al.
Civil Action No. No. 04-904 -KAJ
Dear Judge Jordan:
I represent Defendants in the above~captioned matter and write to inform Your Honor of the present
status of this litigation in anticipation of the October 5, 2005 telephone status conference. This is an
action for breach of contract, trade secret misappropriation, and other business torts where plaintiffs
accuse the defendants of improperly transferring certain plasma spray technology to which plaintiff
alleges it had certain exclusive rights.
1. The Identification of Trade Secrets with Partieularigy
Heraeus has alleged that the Defendants misappropriated trade secrets when the Lynn Defendants sold
their plasma spray business to Nxlidge. The Defendants have contended that, before Heraeus can
conduct invasive discovery of NxEdge’s plasma spray processes and technology, Heraeus mast identify
its allegedly inisappropriated trade secrets with particularity. Defendants’ position is supported by a
number of decisions from Delaware state and federal courts. On September 26, 2005, Heraeus finally
submitted a supplemental interrogatory response addressing its alleged trade secrets in some detail. The
Defendants do not concede that the response is full and complete, having received it only recently, but it
is possible that this response may finally allow the parties to proceed with discovery on this topic.
2. Heraeus’ Failure to Adeguately Respond to Written Discovery
The parties have conducted a significant amount of written discovery in this matter. Vlfhile Hereaus
has produced a large volume of documents, its production of documents has been incomplete in at least
one category of documents. On May l2, 2005, the Lynn Defendants served Heraeus with written
discovery seeking business plans and planning process, financial reporting information, projected and

Case 1 :04-cv—OO904-KAJ Document 115 Filed O9/29/2005 Page 2 of 2
The Honorable Kent A. Jordan
September 28, 2005
Page 2
actual sales and costs of production, budgets, and other similar documents that would provide data or
infomation of a financial nature regarding the plasma spray technology at issue in the case. When
Heraeus failed to produce these types of documents, counsel for the Lynn Defendants made the request
again in a letter dated September 7, 2005. Although Heraeus finally produced a large volume of
financial information on September l3, 2005, the production lacked any of the business plan
documents or narratives relating thereto that the Defendants have been diligently trying to obtain.
Defendants know the business plan documents exist W they are regularly referenced in other Heraeus
documents and inl-leraeus deposition testimony. Moreover, because Heraeus alleges that the Lynn
Defendants misrepresented the nature of the market for the plasma technology at issue in the Amended
Complaint, the business plans and assessment of that market are highly relevant.
3. Depositions
All of the parties to this litigation have taken numerous depositions, including Rule 30(b)(6)
depositions. At least one deposition — the 30(b)(6) deposition on the plasma spray technology used by
NxEdge — has been postponed while waiting for Heraeus to identify its allegedly inisappropriated trade
secrets with particularity. Defendants expect that both sides will be taking a number of additional
depositions, including expert depositions, prior to the Court’s discovery deadline.
Nxlidge has also had difficulty getting certain answers from Heraeus’ Rule 30(b)(6) deponents on topic
areas having to do with the interpretation of the contract at issue. During the course of the deposition,
NxEdge contends that
Heraeus’ understanding of the meaning of the contract at the time it executed the contract cannot he
protected by privilege, and that Heraeus should have to answer the questions. NxEdge expects that this
issue is unlikely to be resolved among the parties, and may require intervention from the Court.
Respectfully submitted,
/s/ Kevin M. Baird
Kevin M. Baird (# 42l9)
l cc: Peter T. Dalleo, Clerk of Court (by Hand)
Karen Jacobs Louden, Esq. (by Hand)
Leslie A. Polizoti, Esq. (by Hand)
Fay Morisseau, Esq. (via Federal Express)
Dennis Duchene, Esq. (via Federal Express)