`FOR THE WESTERN DISTRICT OF NORTH CAROLINA
`CHARLOTTE DIVISION
`CASE NO. 3:20-CV-021-MOC-DCK
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`PHILIPS MEDICAL SYSTEMS
`NEDERLAND B.V., PHILIPS NORTH
`AMERICA LLC, and PHILIPS INDIA LTD.,
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`Plaintiffs,
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`v.
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`TEC HOLDINGS, INC., TRANSTATE
`EQUIPMENT COMPANY, INC., and
`ROBERT A. WHEELER,
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`Defendants.
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`ORDER
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`THIS MATTER IS BEFORE THE COURT on “The Wheeler Defendants’ Motion To
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`Compel Plaintiffs’ Identification Of Misappropriated Trade Secrets And Related Contentions”
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`(Document No. 285); “Philips’ Motion To Compel Deposition Testimony And Expedite Briefing”
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`(Document No. 310); “Philips’ Motion For Protective Order” (Document No. 317); “Defendants’
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`Motion To Compel Production Responsive To Defendants’ FDA Requests” (Document No. 319);
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`and “Defendants’ Motion To Compel Production Of Electronically Stored Information And Source
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`Code And To Modify Protective Order” (Document No. 333).
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`These motions have been referred to the undersigned Magistrate Judge pursuant to 28
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`U.S.C. § 636(b), and are ripe for disposition. Having carefully considered the motions and the
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`record, the undersigned will grant the motions in part and deny the motions in part.
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`BACKGROUND
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`Plaintiffs Philips Medical Systems Nederland B.V., Philips North America LLC, and
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`Philips Electronics India Ltd. (together, “Philips” or “Plaintiffs”), initiated this action on July 28,
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`2017, with the filing of a “Complaint” (Document No. 1) in the United States District Court for
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`the Northern District of Georgia (“N.D.Ga.” or “Georgia Court”) against TEC Holdings, Inc
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`(“TEC”).
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`On September 29, 2017, Defendant TEC “filed a “…Motion to Dismiss” (Document No.
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`13) and a “…Motion To Transfer Venue” (Document No. 14) supported by the “Declaration Of
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`Daniel R. Wheeler” (Document No. 14-1). The motion to transfer sought transfer to this Court.
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`(Document No. 14). Plaintiffs filed a “First Amended Complaint” (Document No. 20) on October
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`20, 2017. Defendant TEC and Defendant Transtate Equipment Company, Inc. (“Transtate”)
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`subsequently filed motions to dismiss the Amended Complaint. (Document Nos. 27 and 34).
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`The Georgia Court denied the motion to transfer on January 2, 2018; and granted in part
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`and denied in part the motions to dismiss on March 14, 2018. (Document Nos. 39 and 42).
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`Plaintiffs’ “Second Amended Complaint” (Document No. 139) (the “Complaint”) was
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`filed on May 23, 2019. Plaintiffs name the following as Defendants in the Second Amended
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`Complaint: TEC Holdings, Inc. (“TEC”), formerly known as Transtate Equipment Company, Inc.
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`(“Transtate I”), Transtate Equipment Company, Inc., formerly known as Transtate Holdings, Inc.
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`(“Transtate II”) (collectively, “Transtate”), and Robert A. (“Andy”) Wheeler, individually and in
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`his capacity as executor and personal representative of the Estate of Daniel Wheeler (“the Estate”)
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`(Andy Wheeler and the Estate are referred to collectively as “the Wheelers” or “Wheeler
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`Defendants”). (Document No. 139).
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`According to the Complaint, Philips “develops, sells, supports, maintains, and services
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`medical imaging systems, such as X-ray systems used at hospitals and medical centers, including
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`the proprietary hardware and software used to operate, service, and repair such systems.”
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`(Document No. 139, p. 2). “Transtate I provided and Transtate II provides maintenance and
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`support services for certain of such medical systems.” (Document No. 139, p. 2). “Several prior
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`employees of Philips North America LLC were previously employed by Transtate I and are
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`currently employed by Transtate II as service specialists, service technicians, or similar positions.”
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`Id. Plaintiff’s “medical imaging systems include Philips’ copyrighted and proprietary intellectual
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`property, and proprietary trade secrets, in the form of, among other things, proprietary software
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`that Philips’s technicians can use to service the medical imaging systems.” Id. Plaintiff “includes
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`proprietary access controls on the medical imaging systems to restrict access to its proprietary
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`software to authorized individuals.” Id.
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`Plaintiff alleges that: “Transtate I has used, and Transtate II continues to use,
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`misappropriated trade secret information from Philips to circumvent the access controls on Philips’
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`medical imaging systems to gain unauthorized access to proprietary and copyrighted software.”
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`(Document No. 139, pp. 2-3). “Transtate I and II have also made unauthorized copies of Philips’
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`standalone service software, circumvented access controls on the standalone software, and made
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`unauthorized use of such software.” (Document No. 139, p. 3). “Transtate I and II have also
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`decrypted and made unauthorized copies of Philips’ copyrighted service documentation.” Id.
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`“Transtate uses its unauthorized access to and copies of Philips’ proprietary software and
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`copyrighted documents to unfairly compete against Philips.” Id.
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`Plaintiffs assert claims in the Second Amended Complaint for: (1) violations of the
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`Computer Fraud and Abuse Act, 18 U.S.C. § 1030; (2) violations of the Digital Millennium
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`Copyright Act, 17 U.S.C. § 1201; (3) violations of the Defend Trade Secrets Act, 18 U.S.C.§
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`1836; (4) misappropriation of trade secrets; (5) violations of the Georgia Trade Secrets Act,
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`O.C.G.A. § 10-1-760, et seq.; and (6) copyright infringement, 17 U.S.C. § 101, et seq. (Document
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`No. 139, pp. 3, 39-89).
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`Defendants filed motions to dismiss the Second Amended Complaint on June 27, 2019,
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`and July 19, 2019. See (Document Nos. 164 and 167). “Defendant Robert A. (“Andy”) Wheeler’s
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`Motion To Transfer Venue” (Document No. 208) was filed on October 23, 2019, with
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`Defendant(s) again seeking transfer to this Court. Plaintiffs opposed transfer. See (Document No.
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`220).
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`On January 10, 2020, the Georgia Court, with a different presiding judge, issued a decision
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`transferring this case to the Western District of North Carolina. (Document No. 241); see also
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`(Document No. 244). The Georgia Court noted, inter alia, that Philips had filed three (3) actions1
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`with this Court since Defendant Transtate I’s original motion to transfer (Document No. 39).
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`(Document No. 241, p. 4).
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`
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`This Court held a Status Conference on January 29, 2020, with the Honorable Max O.
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`Cogburn, Jr. presiding. See (Document No. 269). Pursuant to Judge Cogburn’s instructions, the
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`parties filed their “Certification And Report Of F.R.C.P. 26(F) Conference And Discovery Plan”
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`(Document No. 268) on February 12, 2020.
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`In March 2020, Judge Cogburn denied the motions of TEC Holdings, Inc., Transtate
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`Equipment Co. Inc., and the Wheeler Defendants for partial dismissal. (Document Nos. 270 and
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`271); see also (Document Nos. 164 and 167). The Court then denied multiple discovery-related
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`motions on June 1, 2020. See (Document Nos. 140, 170, 213, and 216). Judge Cogburn also
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`denied “Plaintiffs’ Omnibus Motion To Dismiss Defendants’ Counterclaims And Strike
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`Affirmative Defenses” (Document No. 280). See (Document No. 305).
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`1 Philips N. Am. LLC v. Dorow, 3:19-CV-272-MOC-DSC (W.D.N.C. June 11, 2019); Philips Med. Sys.
`Nederlands B.V. v. TEC Holdings, Inc., 3:19-CV-373-MOC-DCK (W.D.N.C. July 30, 2019); and Philips
`N. Am. LLC v. Zimmerman, No. 3:19-CV-444-MOC-DSC (W.D.N.C. Sept. 10, 2019). See also
`Zimmerman v. Philips N. Am. LLC, 3:20-MC-141-MOC-DCK (W.D.N.C. Sept. 8, 2020).
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`The Court entered its “Pretrial Order And Case Management Plan” (Document No. 279)
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`on June 4, 2020. The case deadlines have since been revised and are currently scheduled as
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`follows: fact discovery completion – May 14, 2021; expert discovery completion – July 16, 2021;
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`mediation report – July 23, 2021; ready date for trial – October 18, 2021. See (Document No.
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`339).
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`Now pending are renewed motions for orders compelling (or seeking protection from)
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`certain discovery requests: “The Wheeler Defendants’ Motion To Compel Plaintiffs’
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`Identification Of Misappropriated Trade Secrets And Related Contentions” (Document No. 285);
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`“Philips’ Motion To Compel Deposition Testimony And Expedite Briefing” (Document No. 310);
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`“Philips’ Motion For Protective Order” (Document No. 317); “Defendants’ Motion To Compel
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`Production Responsive To Defendants’ FDA Requests” (Document No. 319); and “Defendants’
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`Motion To Compel Production Of Electronically Stored Information And Source Code And To
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`Modify Protective Order” (Document No. 333).
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`The undersigned initially attempted to resolve discovery issues between the parties through
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`an informal telephone conference on July 1, 2020. After that effort failed, the parties were directed
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`to file appropriate motions. The undersigned observes that over the two and a half (2 ½) years this
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`matter was pending before the Georgia Court it was presided over by three (3) different judges
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`who dealt with the parties’ multiple discovery disputes, including by conducting telephone
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`conferences to address such disputes. See (Document Nos. 93, 129, 206).
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`The pending motions are now ripe for review and disposition.
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`STANDARD OF REVIEW
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`Rule 26 of the Federal Rules of Civil Procedure provides that:
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`Parties may obtain discovery regarding any nonprivileged
`matter that is relevant to any party’s claim or defense and
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`proportional to the needs of the case, considering the importance of
`the issues at stake in the action, the amount in controversy, the
`parties’ relative access to relevant information, the parties’
`resources, the importance of the discovery in resolving the issues,
`and whether the burden or expense of the proposed discovery
`outweighs its likely benefit. Information within this scope of
`discovery need not be admissible in evidence to be discoverable.
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`Fed.R.Civ.P. 26(b)(1). The rules of discovery are to be accorded broad and liberal construction.
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`See Herbert v. Lando, 441 U.S. 153, 177 (1979); and Hickman v. Taylor, 329 U.S. 495, 507
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`(1947). However, a court may “issue an order to protect a party or person from annoyance,
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`embarrassment, oppression or undue burden or expense.” Fed.R.Civ.P. 26(c)(1).
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`Whether to grant or deny a motion to compel is generally left within a district court’s broad
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`discretion. See Lone Star Steakhouse & Saloon, Inc. v. Alpha of Va., Inc., 43 F.3d 922, 929 (4th
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`Cir. 1995) (denial of motions to compel reviewed on appeal for abuse of discretion); Erdmann v.
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`Preferred Research Inc., 852 F.2d 788, 792 (4th Cir. 1988) (noting District Court’s substantial
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`discretion in resolving motions to compel); and LaRouche v. National Broadcasting Co., 780 F.2d
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`1134, 1139 (4th Cir. 1986) (same).
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`DISCUSSION
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`A. “The Wheeler Defendants’ Motion To Compel . . . ” (Document No. 285)
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`
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`By the pending motion, the Wheeler Defendants seek to compel Plaintiffs to:
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`(1) respond to Interrogatory No. 1 to identify with particularity each
`alleged trade secret that it contends was misappropriated on an
`individual-by-individual basis, including a description of each
`allegedly misappropriated trade secret sufficient to separate the alleged
`trade secret from what is generally known in the field; (2) respond to
`Interrogatories Nos. 3-5 to adequately identify the circumstances of the
`alleged misappropriation of the identified trade secrets and to allow
`Defendants to discover Philips’ attempts to protect the allegedly
`misappropriated trade secrets; and (3) re-designate Philips’ responses
`to these interrogatories as “Confidential,” including any Philips-
`produced documents incorporated therein.
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`(Document No. 285, p. 2); see also (Document No. 285-1).
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`According to the Wheeler Defendants, “Philips has failed to identify with sufficient
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`particularity the alleged trade secrets at issue in this case.” (Document No. 292, p. 2). The Wheeler
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`Defendants summarize their argument for compelling more complete responses as follows:
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`As a legal matter, black letter law establishes that Philips must
`identify—with sufficient particularity—the basis for its alleged
`trade secret claims. Lwin Family Co. v. Aung Min Tun, No.
`3:11CV569, 2012 WL 11922875, at *1 (W.D.N.C. Oct. 11, 2012).
`As a matter of practicality, only Philips knows what information
`Philips subjectively considers a “trade secret” and that it contends
`the defendants misappropriated.
`It
`is only
`fair—indeed,
`fundamental—that Philips finally identify and describe in adequate
`detail this information in its possession, which will enable the
`parties—and the Court—to efficiently proceed with the discovery
`remaining and allow the Wheeler Defendants to prepare their
`defenses and avoid trial by ambush.
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`Id. Defendants later emphasize that they “do not seek the identification of everything Phillips
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`contends is a trade secret in its business, but merely the subset that Phillips contends has been
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`misappropriated and is at issue in this case….” (Document No. 92, p. 5).
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`
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`In addition, the Wheeler Defendants argue that Plaintiffs have “improperly designated its
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`interrogatory responses as ‘Attorneys’ Eyes Only’ (“AEO”)” under the “Protective Order”
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`(Document No. 63). (Document No. 92, p. 2). They contend that this designation further
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`prejudices their “ability to prepare a proper defense, including conferring with defendant Andy
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`Wheeler and the other individuals accused of misappropriation and knowledgeable about the
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`industry.”
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`1. Interrogatory No. 1 – Allegedly Misappropriated Trade Secrets
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`The Wheeler Defendants’ Interrogatory No. 1 requests that Plaintiffs:
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`Identify and describe in detail all Trade Secrets that Plaintiffs allege
`or contend any Defendant misappropriated or used without consent,
`including but not limited to (1) in the development or use of the
`“exploit software”/”software exploit” (see, e.g., Complaint, ¶ 59)
`and “circumvention mechanism” (see, e.g., Complaint, ¶ 72), (2) to
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`gain access to and create copies of Philips’ log files; (3) Philips’
`documents and the “trade secrets . . . expressed in such documents”
`Complaint, ¶ 82); (4) any other “Exploit Mechanisms” (Complaint,
`¶ 85); and (5) any “trade secrets” from “Former Philips Employees”
`(see, e.g., Complaint, ¶¶ 92, 127).
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`(Document No. 292-1, p. 3).
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`The Wheeler Defendants assert that Plaintiffs have identified their “alleged trade secrets
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`by vague, generic descriptors, by document categories encompassing thousands of documents and
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`by pointing to ‘thousands of pages and gigabytes of data.’” (Document No. 292, p. 11).
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`The law requires Philips to identify its trade secrets with
`particularity for the Defendants to understand (1) “exactly what they
`are alleged to have done,” Lwin Family, 2012 WL 11922875 at *1;
`and (2) to “separate [the alleged trade secrets] from ‘matters of
`general knowledge in the trade or of special knowledge of those
`skilled in the trade,’” Silicon Knights, 2008 WL 2414046 at *8
`(quoting Imax Corp. v. Cinema Techs., Inc., 152 F.3d 1161, 1164–
`65
`(7th Cir. 1998)). Philips’
`responses
`to Defendants’
`interrogatories do neither, and instead improperly shift the burden
`to the Wheelers to perform the impossible task of deciphering
`Philips’ contentions by improper reliance on Rule 33(d).
`
`
`Id.
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`Defendants further assert that “it is critical for Philips to provide specific identification of
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`alleged trade secret ‘information’ within any document it contends is at issue so Defendants can
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`reasonably investigate and rebut Philips’ contentions with evidence, including testimony from
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`Philips itself.” (Document No. 292, p. 15) (citing Structural Pres. Sys. V. Andrews, 2013 WL
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`12244886, at *6 (D.Md. Dec. 17, 2004)). The Wheeler Defendants add that bare identification of
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`software tools or databases is inadequate – “Philips is required to provide a description of the
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`alleged trade secret sufficient to separate it from knowledge and processes known in the field.”
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`(Document No. 292, pp. 16-17).
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`Finally, Defendants suggest that Plaintiffs are improperly using Fed.R.Civ.P. 33(d) to
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`avoid identifying their trade secrets. (Document No. 292, p. 17). Defendants acknowledge that in
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`some instances, parties may answer interrogatories with “business records,” but argue that such a
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`response is not appropriate here because the “burden of deriving the answer from the documents
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`is [not] equal among the parties.” Id. Defendants note that “unlike patent or copyright litigation,
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`there is no government-registered document disclosing the intellectual property at issue in a trade
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`secret case.” Id.
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`In response, Plaintiffs argue that they have identified their “contentions with sufficient
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`particularity” and that “Wheeler knows what trade secrets are at issue in this litigation, even if he
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`disputes whether such information constitutes trade secrets. No further identification is required.”
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`(Document No. 301, p. 2). Plaintiffs acknowledge that they “must identify a trade secret with
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`sufficient particularity so as to enable a defendant to delineate that which he is accused of
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`misappropriating.” (Document No. 301, p. 8) (quoting Olympus Managed Health Care, Inc. v.
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`Am. Housecall Physicians, Inc., 853 F.Supp.2d 599, 572 (W.D.N.C. 2012)).
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`Plaintiffs then assert that their response to Interrogatory No. 1 includes “sufficient detail to
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`inform defendants of what they are accused of misappropriating and to allow them to mount a
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`defense.” Id. (citing Document No. 286-1, pp. 2-12). They further assert that they have complied
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`with their “discovery obligation by describing discrete categories of information” and “identifying
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`for defendants documents produced by defendants to Philips that Philips contends evidence
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`misappropriation of its trade secrets.” (Document No. 301, p. 9) (citing Bridgetree Inc. v. Red F.
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`Marketing LLC, 2013 WL 443698, at *4 (W.D.N.C. Feb. 5, 2013)) (emphasis added). Plaintiffs
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`also assert that their incorporation of responses provided to Transtate’s Interrogatories satisfies
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`their burden to respond to the Wheeler Defendants. (Document No. 301, pp. 9-10).
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`Philips Plaintiffs contend, inter alia, that they do not need to identify portions of documents
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`to satisfy their burden of production because “the entire documents it identifies are trade secrets
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`misappropriated by defendants.” (Document No. 301, p. 14). Plaintiffs assert that “documents
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`and software categorically” are entitled to trade secret protection. (Document No. 301, pp. 15-16).
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`In reply, the Wheeler Defendants argue that it is “insufficient for Philips to merely identify
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`categories of information and types of documents.” (Document No. 302, pp. 4-5). Defendants
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`argue that documents and software are not themselves trade secrets. (Document No. 302, pp. 10-
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`13) (citations omitted). Defendants persuasively argue that Philips Plaintiffs must identify what
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`information within each document and category is a misappropriated trade secret, and where the
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`information appears in the documents. (Document No. 302, p. 11).
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`The undersigned has carefully considered the parties’ arguments, and reviewed Plaintiffs’
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`response to Interrogatory No. 1. See (Document No. 286-1, pp. 2-12). In short, the undersigned
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`finds the Wheeler Defendants’ arguments more persuasive. Contrary to Plaintiffs’ arguments, and
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`acknowledging the parties are far more familiar with the facts and underlying technology than the
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`Court, the undersigned does not find that Plaintiffs’ response provides sufficient detail to inform
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`Defendants (or a finder of fact) of what Defendants are accused of misappropriating and to mount
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`a defense. At least in this case, identifying categories of information and thousands of pages of
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`documents, without more explanation, does not seem to be sufficient.
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`Plaintiffs’ responses to Interrogatory No. 1 commit to supplementing in accordance with
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`Fed.R.Civ.P. 26(e). See (Document No. 286-1, p. 13). The undersigned finds that a robust
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`supplementation is long over-due. Such supplementation should begin with counsel for the parties
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`conferring at length about the details of such production, including what kind of additional
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`descriptions are needed and whether “incorporating” other responses is appropriate and helpful.
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`Moreover, it seems that counsel and/or the parties need to focus on what information Defendants
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`had appropriate access to, and then more specifically identify the information that was
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`misappropriated. At least with opposing counsel, named parties, and certain other individuals,
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`Plaintiffs need to be more explicit and precise about the alleged wrongdoing.
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`As noted above, “[t]he rules of discovery are to be accorded broad and liberal
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`construction.” The undersigned expects counsel to work diligently and swiftly to clarify the
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`information Defendants have allegedly misappropriated – the admissibility of such information
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`will be a question for another day.
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`2. Interrogatory Nos. 3-5 – Supplementation
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`Next, Defendants contend that supplementation of Interrogatory Nos. 3-5 will be
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`appropriate after supplementation of Interrogatory No. 1, and that it is necessary to identify the
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`circumstances of the alleged misappropriation and to understand Plaintiffs’ attempts to protect the
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`allegedly misappropriated trade secrets. (Document No. 292, p. 23).
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`In response, Plaintiffs conclude that Defendants’ only criticism of Philips’ responses to
`
`Interrogatory Nos. 3-5 is that they will require supplementation if/when Interrogatory No. 1 is
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`supplemented. (Document No. 301, p. 16). Plaintiffs agree to “timely supplement its interrogatory
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`responses in accordance with its obligations under the federal and local rules and this Court’s
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`orders.” Id.
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`
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`According to Defendants,
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`Philips must supplement its responses to Interrogatory Nos. 3-5 to
`address for all contentions the specific alleged instances of
`misappropriation or use of the particular trade secret information
`(No. 3), all persons who have or have had rights or access to the
`particular trade secret information (No. 4), and Philips’ efforts to
`maintain secrecy of the particular trade secret information (No. 5).
`
`(Document No. 302, p. 15).
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`11
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`The undersigned finds that Plaintiffs should supplement their responses to Interrogatory
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`Nos. 3-5, after supplementing responses to Interrogatory No. 1 and conferring with Defendants’
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`counsel.
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`3. Designation of Discovery Responses
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`The Wheeler Defendants’ motion to compel also seeks to have Plaintiffs re-designate their
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`supplemental discovery responses. (Document No. 292, pp.23-26). Defendants note that the
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`entirety of the supplemental discovery responses are currently designated “Confidential-Attorneys
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`Eyes Only” and such designation has prevented “Defendants’ counsel from sharing the responses
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`with their clients who are accused of misappropriating the very information Philips will not now
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`permit them to see again during discovery.” (Document No. 292, p. 23); see also (Document No.
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`286-1).
`
`
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`According to Defendants:
`
`Philips has not established good cause for an Attorneys’ Eyes Only
`designation. In order for Philips to have any basis for making its trade secret
`misappropriation allegations, the implicated individuals necessarily must
`have seen the allegedly AEO materials already—this includes named
`defendant Andy Wheeler who will be present for the entire trial, as well as
`the other individuals named in the interrogatory responses. See Ex. B at 11
`(“e.g., Dorow, Peterson, Griswold, Zimmerman, Little”); id. at 57 (“By
`way of further response, Philips identifies Dale Dorow, William Griswold,
`Darryl Dancy, Charles Peterson, Robert David Rendfeld, James M. Froman,
`Robert J. Bostdorf, and Scott Dow as the Former Philips Employees whom
`Plaintiffs are presently aware and from whom Defendants have obtained
`Philips’ trade secrets and confidential or proprietary information”). Thus,
`there can be no undue harm from these individuals seeing the materials
`again and understanding Philips’ contentions against them. Defendants do
`not object to the responses and any referenced document being re-
`designated “Confidential,” which would still protect the information but
`permit the disclosure the Wheelers and other defendants must have to fairly
`defend against the allegations against them.
`
`(Document No. 292, p. 25).
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`
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`12
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`Plaintiffs’ response notes that it has “already provided Defendants with a redacted copy of
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`its interrogatory responses that does not redact any information from Philips’ response to
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`Interrogatory No. 1 and offered to allow defendants to share it with Wheeler, Dorow G[r]iswold,
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`and Zimmerman if defendants agreed to the reasonable terms.” (Document No. 294-1, p. 17)
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`(citing Document No. 295-2, pp. 3-4).
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`
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`In reply, the Wheeler Defendants ask the Court to re-designate Philips’ responses to
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`Transtate Interrogatories as “Confidential,” and to direct that Philips’ redaction of “its
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`parenthetical contentions” be removed. (Document No. 302, pp. 15-16).
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`It appears to the undersigned that the parties have made some progress (as of August 2020)
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`on this issue. The undersigned is persuaded that Attorneys’ Eyes Only designation has been
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`overused and encourages Plaintiffs to continue to redact and/or re-designate its discovery
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`production so that Defendants’ counsel can include their clients and certain other individuals in its
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`review. The Court expects counsel to continue to work in good faith to make appropriate
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`designations.
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`B. “Philips’ Motion To Compel Deposition Testimony . . . ” (Document No. 310)
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`Plaintiffs’ “… Motion To Compel Deposition Testimony And Expedite Briefing” seeks to
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`compel Defendants to participate in depositions without delay, including Dale Dorow, Bill
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`Griswold, and Andy Wheeler. (Document No. 310); see also (Document No. 311). Plaintiffs
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`argue that Defendants are flouting the Scheduling Order and that delay threatens the parties’ ability
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`to complete discovery by Court-imposed deadlines. Id.
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`“Defendants’ Response In Opposition…” argues that this motion is “both premature and
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`unwarranted.” (Document No. 315, p. 1). Defendants contend that Plaintiffs failed to meet-and-
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`confer before raising this issue with the Court and filing the instant motion. Id. Moreover,
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`Case 3:20-cv-00021-MOC-DCK Document 340 Filed 03/31/21 Page 13 of 23
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`13
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`Defendants assert that they have not prevented Plaintiffs from taking depositions, but that they
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`have raised discovery concerns they believe should be addressed along with scheduling
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`depositions. Id.
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`“Plaintiffs’ Reply…” notes that methods of discovery may be used in any sequence and
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`discovery by one party does not require any other party to delay its discovery. (Document No.
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`316, p. 1) (quoting Fed.R.Civ.P. 26(d)(3)). Plaintiffs contend that Defendants have now avoided
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`depositions for more than two years. (Document No. 316, p. 5).
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`Unlike the first motion discussed above, the issue here seems fairly simple and clear cut.
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`The parties’ failure to confer and work out an appropriate deposition schedule is disappointing,
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`but there does not seem to be any meaningful dispute that these depositions should proceed.
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`The motion will be granted, and the parties are directed to immediately schedule the
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`Dorow, Griswold, and Wheeler depositions if they have not already been conducted or scheduled.
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`In fact, with the revised discovery deadline approaching in May, counsel should promptly schedule
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`any remaining depositions they think are necessary.
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`C. “Philips’ Motion For Protective Order” (Document No. 317)
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`By the instant motion, Plaintiffs seek “a protective order that forbids discovery relating to
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`21 C.F.R. § 1020.30(g) (the “FDA Regulation, or, when referenced by Defendants, the “AIAT
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`Regulation”).”2 (Document No. 317, p. 1). Plaintiffs assert that a protective order is required
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`because “Defendants have taken contradictory and confusing positions on whether or not they seek
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`to litigate Philips compliance with the FDA Regulation.” Id. Plaintiffs contend that Defendants’
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`counterclaims allege Philips has violated its disclosure obligations, but argue that the FDA has
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`2 The Second Amended Complaint notes that “Philips provides tools to allow performance of assembly,
`installation, adjustment, and testing (“AIAT”) services on Philips Systems . . . Philips provides an AIAT
`access level to allow customers or third-party service providers of their choosing to access tools to perform
`AIAT services.” (Document No. 139, p. 10) (emphasis added).
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`Case 3:20-cv-00021-MOC-DCK Document 340 Filed 03/31/21 Page 14 of 23
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`exclusive authority to determine if a manufacturer has violated the FDA Regulation. (Document
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`No. 317, pp. 1-2). According to Philips, although Defendants have disclaimed reliance on the
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`FDA Regulation, they persist in dozens of discovery requests that directly relate to the FDA
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`Regulation. (Document No. 317, p. 2).
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`Plaintiffs go on to argue that discovery related to the FDA Regulation is “irrelevant
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`background.” (Document No. 318, p. 11) (citing Fed.R.Civ.P. 26). In the alternative, they argue
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`that inquiry into the FDA Regulations is barred as a matter of law. (Document No. 318, p. 13).
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`“Defendants’ Joint Response In Opposition…” notes that “the Court has already
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`considered and rejected the exact argument in Philips’ motion to dismiss that it now re-deploys as
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`a protective order dispute.” (Document No. 323, p. 1). In addition, Defendants aver that the “Court
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`need not interpret or apply the FDA Regulation, because, at a minimum, what Philips deems, or
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`has deemed in the past, to be AIAT material – rightly or wrongly – and how it has behaved
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`regarding that material is relevant to all parties claims and defenses.” (Document No. 320, p. 2).
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`Further, Philips’ conflation of specific AIAT-related issues with
`FDA discovery, generally, should be rejected. Just because
`Defendants seek FDA-related discovery, which includes matters
`related to the AIAT Regulation, does not mean that Defendants are
`seeking to enforce the AIAT Regulation. Nor does it make
`“irrelevant,” the FDA-related discovery Defendants seek in support
`of their defenses and counterclaims.
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`(Document No. 323, pp. 3-4).
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`Plaintiffs filed a “… Notice Of Intent Not To Reply…” citing reliance on its motion and
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`memorandum, as well as the “…Memorandum Of Law In Opposition To Defendant’s Motion To
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`Compel” (Document No. 325).
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`Even accepting that Plaintiffs are correct that only the FDA is empowered by Congress to
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`interpret or enforce the FDA Regulation, the undersigned is still not persuaded that a party should
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`be forbidden from conducting discovery that relates to the FDA Regulation and AIAT. Moreover,
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`Case 3:20-cv-00021-MOC-DCK Document 340 Filed 03/31/21 Page 15 of 23
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`Plaintiffs sought to dismiss or strike counterclaims or affirmative defenses related to the FDA
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`Regulation and/or AIAT and Judge Cogburn specifically acknowledged such arguments and
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`denied Plaintiffs’ motion to dismiss – pending further developmen