`Transaction ID 72753777={°\7i,.1" 2)
`Case No. 2023-0513-PAF (a7:s/
`IN THE COURT OF CHANCERYOF THE STATE OF DELAWARE3."
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`LEON GILBERT and MICHAEL
`MCGARVEY,
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`) PUBLIC VERSIONFILED:
`) April 16, 2024
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`) )
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`Plaintiffs,
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`Vv.
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`) CA. No. 2023-0513-PAF
`)
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`) )
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`)
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`UNISYS CORPORATION,
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`Defendant.
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`DEFENDANT’S MOTION
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`FOR CONTINUED CONFIDENTIAL TREATMENT
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`ROSS ARONSTAM & MORITZ LLP
`
`David E. Ross (Bar No. 5228)
`Eric D. Selden (Bar No. 4911)
`Hercules Building
`1313 North MarketStreet, Suite 1001
`Wilmington, Delaware 19801
`(302) 576-1600
`
`Attorneysfor Defendant Unisys
`Corporation
`
`OfCounsel:
`
`Martin L. Roth, P.C.
`KIRKLAND & ELLIS LLP
`300 North LaSalle
`Chicago,Illinois 60654
`(312) 862-2000
`
`Haley S. Stern (DE Bar No. 6349)
`Amanda Lamothe-Cadet
`Maylynn Chen
`KIRKLAND & ELLIS LLP
`601 Lexington Avenue
`New York, New York 10022
`(212) 446-4800
`
`April 9, 2024
`
`EFiled: Apr 16 2024 04:30PM EDT
`Transaction ID 72753777
`Case No. 2023-0513-PAF
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`INTRODUCTION
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`1.
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`Plaintiffs’ rejection of Unisys’ proposed redactions to their Pretrial
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`Brief confirms what Unisys has suspected all along: that Plaintiffs and their new
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`employer, Atos—co-defendants in the underlying trade secrets dispute (Unisys
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`Corporation v. Gilbert, et al., No. 2:23-cv-555-PD, the “Pennsylvania Action”)—
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`are improperly using this advancement proceeding as an additional avenue to obtain
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`discovery for use in the Pennsylvania Action. Just one day after this case was tried,
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`Plaintiffs filed a challenge to the confidential treatment of sensitive business
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`information that Unisys had sought to redact from their Pretrial Brief. The same
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`day, Unisys also received a letter from Atos demanding that all deposition and trial
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`testimony from Unisys in this matter be produced to Atos in the Pennsylvania
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`Action.
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`2.
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`Such gamesmanship cannot be countenanced. Plaintiffs’ inappropriate
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`and coordinated behavior with Atos—who is not a party to this action—violates the
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`parties’ stipulated protective order in this case, see Dkt. 16, and undermines the
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`integrity of both this proceeding and the Pennsylvania Action. In light of Plaintiffs’
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`suspect motivations for challenging confidential treatment, and the risk that Unisys
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`will suffer commercial harm should the internal workings of its business be exposed,
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`the Court should grant Unisys’ motion for continued confidential treatment, and
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`permit Unisys to file a revised public version of Plaintiffs’ Pretrial Brief with the
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`redactions reflected in the attached Exhibit A.
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`BACKGROUND
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`3.
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`On March 30, 2024, Defendant proposed redactions to the public
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`version of Plaintiffs’ Pretrial Brief. Plaintiffs publicly filed that version on
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`April 1, 2024. Dkt 96. On April 2, 2024, Plaintiffs filed a challenge to the
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`confidential treatment of the information redacted from Plaintiffs’ pretrial brief.
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`Dkt. 99.
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`4.
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`On April 5, 2024, Defendant proposed revised redactions in light of
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`material made public during trial, which greatly reduced the amount of information
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`subject to confidential treatment. Ex. B. On April 6, 2024, Plaintiffs rejected
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`Unisys’ proposal.
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`5.
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`Plaintiffs’ have since further refined their proposed redactions. See Ex.
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`A. These revised redactions are discrete and pertain to Unisys’ business strategies,
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`including its implementation of advice received from McKinsey & Co. related to the
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`reorganization of the company.
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`6.
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`Throughout this proceeding, Plaintiffs have continuously sought access
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`to, and use of, documents and information exclusively relevant to the Pennsylvania
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`Action, where the main dispute is over the competitive harm suffered by Unisys as
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`a result of the theft of its trade secrets. See, e.g., Dkt. 37, Pls.’ Mot. to Coordinate
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`2
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`Expedited Discovery with the Pennsylvania Action (seeking to obtain access to over
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`288,000 documents even though only a small fraction hit on the agreed-upon search
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`terms in this action); Dkt. 95, Def’s Mem. Concerning Evidentiary Issues related to
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`the Pennsylvania Action; Thomson Dep. Tr. 98:19-21 (Q: “[W]hat trade secrets are
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`at issue in the Pennsylvania action?”), 130:18-22 (Q: “Unisys argued that Atos
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`avoided costs associated with the acquisition of Unify Square due to Plaintiffs’
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`misappropriation of trade secrets?”); Altabef Dep. Tr. 52:17 (Q: “Is Atos a
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`competitor of Unisys?”), 52:19-20 (Q: “Does Atos do business in the digital
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`workplace solution space?”), 54:20-22 (Q: “Unisys operates its DWS business as a
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`business unit, is that the same structure for [Atos’] DWS business?”).
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`7.
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`Unisys has maintained that such documents and attempts to elicit
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`testimony not relevant to the instant action are inappropriate. For example, Unisys
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`objected to Topic 16 from Plaintiffs’ Notice of Rule 30(b)(6) Deposition, which
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`sought testimony about “DWS’s trade secrets that Unisys alleges Plaintiffs accessed
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`by virtue of their officer-level leadership of DWS.” Dkt. 51, Schedule A at 6.
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`Unisys responded that it would not designate a witness to testify about Topic 16 on
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`the basis that it “seeks information not relevant to Plaintiffs’ claim.” Ex. C at 14.
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`8.
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`Likewise, after Peter Altabef’s deposition, where Plaintiffs engaged in
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`extensive questioning relating to the Pennsylvania Action, Unisys again informed
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`Plaintiffs that lines of questioning relating to the merits of the underlying trade
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`3
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`secrets dispute in the Pennsylvania Action were irrelevant and inappropriate to the
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`parties’ claims and defenses here. See Ex. D, Letter from E. Selden re Trade Secrets.
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`9.
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`Defendant subsequently raised this issue in the Pretrial Order, objecting
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`to the use of trial exhibits and testimony relating to the Pennsylvania Action that
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`were not relevant to the advancement case. Dkt. 84 ¶ 67. Following the Pretrial
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`Conference, on March 28, 2024, both parties submitted memoranda to the Court in
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`support of their respective views on the evidentiary issues related to the
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`Pennsylvania Action. See Dkts. 94, 95.
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`10. Despite Defendant’s repeated objections to Plaintiffs’ attempts to delve
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`into the merits of the Pennsylvania Action, on April 2, 2024, just one day after the
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`trial in this action, Atos’ counsel in the Pennsylvania Action sent a letter to Unisys,
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`demanding the production of all deposition and trial testimony from Unisys
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`witnesses in this advancement proceeding. Ex. E, Letter from G. Laufer. Atos is
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`not a party to this advancement case, but it is a party to the Pennsylvania Action.
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`Atos’ counsel insisted that “[the Unisys witnesses’] testimony is obviously relevant
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`to the [Pennsylvania] matter and must be produced.” Id.
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`11. That same day, Plaintiffs also filed the instant challenge to Unisys’
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`redactions to their Pretrial Brief. Dkt. 99.
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`4
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`LEGAL STANDARD
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`12. Rule 5.1 provides that material filed with the Court may be treated as
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`confidential and excluded from public access upon a showing of “good cause.” Ct.
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`Ch. R. 5.1(b)(1). “[G]ood cause” exists where “the public interest in access to Court
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`proceedings is outweighed by the harm that public disclosure of sensitive, non-
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`public information would cause.” Ct. Ch. R. 5.1(b)(2).
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`13. Trade secrets, sensitive proprietary information, sensitive financial,
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`business, or personal information can all qualify as Confidential Information. Ct.
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`Ch. R. 5.1(b)(2).
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`14. After an objection is filed, the party seeking to maintain confidential
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`treatment “bears
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`the burden of establishing good cause” for continued
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`confidentiality. Ct. Ch. R. 5.1(b)(3). However, the court can exercise its discretion
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`when evaluating whether certain information should remain confidential. See In re
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`John E. du Pont, 1997 WL 383008, at *2-3 (Del. Ch. June 20, 1997) (“Although
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`there is a general presumption of access to civil proceedings and records, courts have
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`the discretion and power to close hearings and keep records under seal when
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`appropriate.”); see also Kronenberg v. Katz, 872 A.2d 568, 608 (Del. Ch. 2004)
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`(noting that “reasonable limitations can be placed on public access to judicial
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`records”); Al Jazeera Am., LLC v. AT & T Servs., Inc., 2013 WL 5614284, at *7
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`(Del. Ch. Oct. 14, 2013) (permitting continued confidential treatment “when
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`5
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`confidentiality does not greatly disadvantage the public’s ability to understand the
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`nature of the dispute”) (emphasis added).
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`15. This Court has previously looked at the challenger’s “unique goals”
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`when balancing these competing interests. See In re Lordstown Motors Corp.
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`S’holders Litig., 2022 WL 601120, at *1, *7 (Del. Ch. Feb. 28, 2022) (holding that
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`a court can consider “the challenger’s identity or motivations in conducting a
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`Rule 5.1 analysis” and finding that a challenger’s “unique goal” of end-running the
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`discovery process in a related action was “not indicative of a broader public
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`interest”); see also GKC Strategic Value Master Fund, LP v. Baker Hughes Inc.,
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`2019 WL 2592574, at *2 (Del. Ch. June 25, 2019) (noting that “gamesmanship” can
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`be considered in a Rule 5.1 analysis).
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`16. Nonpublic details about corporate business strategies—and information
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`that a company’s competitors could leverage to their benefit, in particular—can
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`warrant confidential treatment under Rule 5.1 when such information is not material
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`to understanding the nature of the dispute. See Reid v. Siniscalchi, 2014 WL
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`6486589, at *1 (Del. Ch. Nov. 20, 2014) (confidential treatment appropriate for
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`“information regarding business strategies, product development, and perhaps
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`governmental relationships”); see also Uvaydov v. Fenwick-Smith, 2023 WL
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`4614766, at *4 (Del. Ch. July 18, 2023) (maintaining confidential treatment of board
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`discussions regarding organizational planning and product projections where
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`6
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`“[disclosure] could allow” a company’s “competitors to identify [its] business
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`development strategies and impair [its] market competitiveness”).
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`ARGUMENT
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`A. Disclosing
`Information Would
`the Confidential
`Particularized Harm on Defendant.
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`Inflict
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`17. Unisys’ proposed redactions to Plaintiffs’ Pretrial Brief reveal details
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`about Unisys’ internal operations and business plans that would, if revealed to
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`competitors, cause Unisys commercial harm.
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`18. The proposed redactions pertain chiefly to Unisys’ plans and processes
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`for the reorganization of its internal structure in late 2020 to early 2021. Unisys
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`engaged McKinsey and other consulting firms to assist with this internal
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`restructuring and to develop business strategies for Unisys following that
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`reorganization. This project was referred to by insiders as “Project Minerva.”
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`19. Unisys proposes redacting quotes from documents and depositions that
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`would reveal its business strategies for growth and development upon the
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`completion of that project (such as on which markets and which products it intends
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`to focus). This information reflects the strategic thinking of, and deliberations
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`between, Unisys’ management, its board of directors, and its advisors. Public
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`revelation of such strategies “could undercut the effectiveness of those efforts, or
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`provide competitors with value information they could exploit to their own
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`advantage.” Genentech, Inc. v. Amgen, Inc., 2020 WL 9432700, at *6 (D. Del. Sept.
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`7
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`2, 2020), report and recommendation adopted, 2020 WL 9432702 (D. Del. Oct. 1,
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`2020).
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`20. Further, Unisys’ concern that the material could be used against it is not
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`only founded, Atos has already indicated that it will attempt to use any disclosed
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`materials against Unisys at least in the Pennsylvania Action.
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`B.
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`The Public Interest in the Confidential Information, If Any, Is
`Minimal.
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`21.
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`Implementation of Unisys’ proposed redactions to Plaintiffs’ Pretrial
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`Brief will not interfere with, let alone “greatly disadvantage,” the public’s ability to
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`understand this advancement dispute. See Al Jazeera, 2013 WL 5614284, at *7.
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`22. The parties dispute whether Plaintiffs were officers of Unisys
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`Corporation and whether the DWS business unit was an “enterprise” under the
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`indemnification provision of Unisys’ Certificate of Incorporation.1 The history,
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`plans, and analyses that led Unisys to restructure its business in 2020 bears little on
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`those issues, if at all. There is no dispute that DWS became a reportable segment of
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`Unisys in January 2021; rather, the only point of contention is whether DWS’ status
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`as a reportable segment is relevant to whether it constitutes an “enterprise.” To
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`evaluate this issue, the public does not need specific knowledge of documents
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`1 The parties also dispute whether Plaintiff Gilbert’s involvement in the trade secrets
`dispute occurred “by reason of the fact” of his brief tenure as President of Unify Square.
`None of the proposed redactions touch on this issue.
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`8
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`discussing McKinsey’s and others’ analyses, which ultimately caused Unisys to
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`adopt its current business unit-focused model. Nor would specifics regarding
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`Unisys’ planned areas of future growth aid the public in understanding the issues
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`relevant to this advancement dispute. Such “discrete information is of modest
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`importance to the public’s understanding of this dispute and has the potential to
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`cause commercial harm” to Unisys. Lordstown, 2022 WL 601120, at *1. As such,
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`it should remain redacted.
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`C.
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`Plaintiffs’ Reasons for Challenging Confidentiality Give Rise to an
`Inference of Gamesmanship.
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`23. Finally, the Court should consider Plaintiffs’ “unique goals” in
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`challenging confidential treatment, which “are not indicative of a broader public
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`interest.” Id.
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`24. Throughout this litigation, Plaintiffs have sought discovery—through
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`document requests, depositions, and even testimony at trial—that is clearly not
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`relevant to the issues in this advancement proceeding, yet very relevant to the merits
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`of the Pennsylvania Action. Unhappy with the fruits of the discovery process in the
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`Pennsylvania Action, which revealed that Plaintiffs downloaded tens of thousands
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`of documents from Unisys servers to their personal devices upon their departure
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`from the company, Plaintiffs (and Atos) are now engaged in a last-ditch effort to
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`obtain favorable testimony in this action to minimize their damages in the
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`Pennsylvania Action. That much was made clear when Atos’ counsel demanded,
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`one day after trial, that all deposition and trial testimony from this action be produced
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`to them. See Ex. E, Letter from G. Laufer (insisting that Unisys witnesses’ testimony
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`in the Chancery Court “encompassed topics relevant to the [Pennsylvania] matter
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`rendering that testimony subject to production”). As Atos is not a party to this
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`advancement proceeding, such production would be inappropriate and in
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`contravention of the terms of the parties’ confidentiality stipulation, which allows
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`confidential discovery material to be disclosed only “to the extent deemed
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`reasonably necessary . . . for the purpose of assisting in the prosecution or defense”
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`of the instant action. Dkt. 16 (Confidentiality Order) § 5(a).
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`25. As in Lordstown, the Court should see Plaintiffs’ challenge to
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`confidentiality here for what it is: a naked attempt to end-run the discovery process
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`in the Pennsylvania Action and “fulfill [their] need for information” to use in that
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`litigation. 2022 WL 601120, at *7. The Court can and should consider Plaintiffs’
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`suspect motivations in its balancing of the public and private interests under Rule
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`5.1. See id.
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`CONCLUSION
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`Accordingly, the Court should grant Defendant’s motion to continue to treat
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`the requested information as confidential.
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`10
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`ROSS ARONSTAM & MORITZ LLP
`
`/s/ Eric D. Selden
`David E. Ross (Bar No. 5228)
`Eric D. Selden (Bar No. 4911)
`Hercules Building
`1313 North MarketStreet, Suite 1001
`Wilmington, Delaware 19801
`(302) 576-1600
`
`Attorneysfor Defendant Unisys
`Corporation
`
`Words: 2,168/3,000
`
`OfCounsel:
`
`Martin L. Roth, P.C.
`KIRKLAND & ELLIS LLP
`300 North LaSalle
`Chicago,Illinois 60654
`(312) 862-2000
`
`Haley S. Stern (DE Bar No. 6349)
`Amanda Lamothe-Cadet
`Maylynn Chen
`KIRKLAND & ELLIS LLP
`601 Lexington Avenue
`New York, New York 10022
`(212) 446-4800
`
`April 9, 2024
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`PUBLIC VERSION FILED:
`April 16, 2024
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`ll
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`CERTIFICATE OF SERVICE
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`I, Eric D. Selden, hereby certify that on April 16, 2024, I caused a true and
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`correct copy of the Public Version of Defendant’s Motion for Continued Confidential
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`Treatment to be served through File & ServeXpress on the following counsel:
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`John M. Seaman
`E. Wade Houston
`Joseph A. Sparco
`ABRAMS & BAYLISS LLP
`20 Montchanin Road, Suite 200
`Wilmington, Delaware 19807
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`/s/ Eric D. Selden
`Eric D. Selden (Bar No. 4911)
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