Amgen Inc. et al v. Sandoz Inc. et al

Filing 66

Discovery Order re: 64 Letter Brief. Signed by Judge Maria-Elena James on 1/3/2017. (mejlc2S, COURT STAFF) (Filed on 1/3/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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AMGEN INC., ET AL.,

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Case No. 16-cv-02581-RS (MEJ)

Plaintiffs,
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DISCOVERY ORDER

v.

Re: Dkt. No. 64

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SANDOZ INC., et al.,

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Defendants.

United States District Court
Northern District of California

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INTRODUCTION

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Plaintiffs Amgen, Inc. and Amgen Manufacturing Limited (collectively, ―Amgen‖) and

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Defendants Sandoz Inc. and Lek Pharmaceuticals d.d. 1 (collectively, ―Sandoz‖) disagree about the

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wording of a provision in their proposed protective order regarding in-house counsel‘s access to

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confidential materials. Jt. Ltr., Dkt. No. 64. Both parties agree that a protective order is

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necessary, and each has submitted a proposed protective order largely based on the one entered in

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Amgen Inc. v. Sandoz Inc., 14-cv-4741 (N.D. Cal.) (the ―filgrastim case‖). The filgrastim case is a

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related case pending before the presiding judge in this matter, the Honorable Richard Seeborg.

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The filgrastim protective order is based on the Northern District of California‘s Patent Model

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Protective Order. But Sandoz seeks to modify the filgrastim protective order by adding an

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additional tier of confidentiality: ―HIGHLY CONFIDENTIAL—OUTSIDE COUNSELS‘ EYES

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ONLY‖ (―OCO‖). Amgen opposes including this additional tier. Having considered the parties‘

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positions, the relevant legal authority, and the record in this case, the Court issues the following

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order.

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Lek Pharmaceuticals is not a party in the filgrastim case.

LEGAL STANDARD

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Federal Rule of Civil Procedure 26(c) ―confers broad discretion on the trial court to decide

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when a protective order is appropriate and what degree of protection is required.‖ Seattle Times

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Co. v. Rhinehart, 467 U.S. 20, 36 (1984). ―The court may, for good cause, issue an order to

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protect a party or person from annoyance, embarrassment, oppression, or undue burden or

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expense,‖ including by (1) prohibiting disclosure or discovery; (2) conditioning disclosure or

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discovery on specified terms; (3) preventing inquiry into certain matters; or (4) limiting the scope

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of disclosure or discovery to certain matters. Fed. R. Civ. P. 26(c)(1).
DISCUSSION

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United States District Court
Northern District of California

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Sandoz proposes that a ―HIGHLY CONFIDENTIAL – OUTSIDE COUNSELS‘ EYES
ONLY‖ designation should apply to

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extremely sensitive ―Confidential Information or Items‖ that consist
of or relate to communications with the [Food and Drug
Administration (―FDA‖)] occurring on or after June 24, 2016
relating to the approval of Biologics License Application [―BLA‖]
No. 761045 for the Sandoz pegfilgrastim product, that constitute
hyper-sensitive, competitive information that will cause irreparable
harm if disclosed to another Party, including to such Party‘s
Designated House Counsel, or Non-Party, which harm could not be
avoided by less restrictive means.

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Sandoz Prop. Protective Order ¶ 2.11, Ex. B, Jt. Ltr. The Court finds Sandoz has not shown an

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OCO designation is appropriate at this point.

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Courts may not deny access to confidential information solely on the basis of counsel‘s in-

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house or retained status. U.S. Steel Corp. v. United States, 730 F.2d 1465, 1467-68 (Fed. Cir.

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1984). ―Denial or grant of access . . . cannot rest on a general assumption that one group of

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lawyers are more likely or less likely inadvertently to breach their duty under a protective order.‖

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Id. at 1468. Rather, ―the factual circumstances surrounding each individual counsel‘s activities,

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association, and relationship with a party, whether counsel be in-house or retained, must govern

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any concern for inadvertent or accidental disclosure.‖ Id. Denial of access may be appropriate in

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some instances; for example, ―where in-house counsel are involved in competitive

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decisionmaking, it may well be that a party seeking access should be forced to retain outside
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counsel or be denied the access recognized as needed.‖ Id.
As Sandoz notes, ―Amgen has yet to identify its Designated House Counsel for [this]
matter[.]‖ Jt. Ltr. at 4. Sandoz presumes, however, that Amgen ―would . . . identify at least

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counsel who have already appeared in this matter – Wendy Whiteford (Vice President, Law) and

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Lois Kwasigroch (Senior Counsel) – whose titles indicate that they have broad responsibilities

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with competitive impact.‖ Id. Given that Amgen has not named its designated in-house counsel,

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the Court cannot conduct the counsel-by-counsel, fact-specific analysis necessary to determine if

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Amgen‘s in-house counsel engages in competitive decisionmaking. The U.S. Steel court defined

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―competitive decisionmaking‖ as ―counsel‘s activities, association, and relationship with a client

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that are such as to involve counsel‘s advice and participation in any or all of the client‘s decisions

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United States District Court
Northern District of California

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(pricing, product design, etc.) made in light of similar or corresponding information about a

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competitor.‖ 730 F.2d at 1468 n.3; see also Barnes & Noble, Inc. v. LSI Corp., 2012 WL 601806,

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at *2 (N.D. Cal. Feb. 23, 2012) (quoting id.). Although Sandoz identifies Ms. Whiteford and Ms.

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Kwasigroch, their titles alone do not provide sufficient information regarding their responsibilities

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toward or their relationship with Amgen such that the Court can determine if these attorneys are

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involved in any competitive decisionmaking. That Ms. Whiteford and Ms. Kwasigroch are

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involved in such activity is, at this point, speculation.

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In Brown Bag Software v. Symantec Corp., the Ninth Circuit reviewed a protective order

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that shielded the plaintiff‘s in-house counsel from viewing documents that contained the

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defendant‘s trade secrets, but allowed an independent consultant access to them to advise the

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plaintiff as to the documents‘ relevancy. 960 F.2d 1465, 1469-72 (9th Cir. 1992). The Brown Bag

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Court noted that ―proper review of protective orders in cases such as this requires the district court

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to examine factually all the risks and safeguards surrounding inadvertent disclosure by any

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counsel, whether in-house or retained.‖ Id. at 1470. The Ninth Circuit found the district court did

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just that: it issued the protective order after conducting ―a comprehensive evidentiary hearing.‖ Id.

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at 1470. At the hearing, the district court heard testimony regarding both parties‘ interest in the

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confidential information. Id. at 1470-71. The district court also questioned the plaintiff‘s in-house

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counsel about his responsibilities. Id. at 1741. In-house counsel testified that ―he was responsible
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for advising his employer on a gamut of legal issues, including contracts, marketing, and

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employment.‖ Id. The district court thus ―reasonably concluded that [in-house] counsel‘s

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employment would necessarily entail advising his employer in areas relating to [the defendant‘s]

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trade secrets.‖ Id. This ―would place in-house counsel in the ‗untenable position‘ of having to

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refuse his employer legal advice on a host of contract, employment, and competitive marketing

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decisions lest he improperly or indirectly reveal [the defendant‘s] trade secrets.‖ Id. After

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weighing the hardship a protective order may have on the plaintiff‘s prosecutions of its claims, the

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district court issued a protective order that the Ninth Circuit held ―str[uck] a reasonable balance

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between those interests by shielding [the plaintiff‘s] in-house counsel from personal knowledge of
a competitor‘s trade secrets, but allowing access to information through an independent

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United States District Court
Northern District of California

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consultant.‖ Id. ―The order did not arbitrarily distinguish [between] outside and in-house counsel.

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Rather, in reaching its decision, the court considered the particular circumstances of [the

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plaintiff‘s] counsel then before it. The same considerations could have applied equally to outside

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counsel.‖ Id.

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In contrast, Amgen‘s in-house counsel‘s identities in this matter are still unknown. The

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Court is therefore unable to consider the specific responsibilities of those attorneys, and is unable

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to evaluate whether they are engaged in competitive decisionmaking for their client. Cf. Pinterest,

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Inc. v. Pintrips, Inc., 2014 WL 5364263, at *2 (N.D. Cal. Oct. 21, 2014) (relying on in-house

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counsel‘s declarations stating they do not engage in competitive decisionmaking and describing

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counsel‘s responsibilities); Barnes & Noble, Inc., 2012 WL 601806, at *2 (same). Adopting

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Sandoz‘s OCO provision at this point would be to arbitrarily distinguish between counsel solely

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on the basis of their in-house and retained status.
CONCLUSION

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At this time, the Court will not adopt Sandoz‘s OCO designation. Sandoz may move to

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modify the protective order once Amgen identifies its designated in-house counsel, provided

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Sandoz can point to factual circumstances of each counsel that suggest the risk of inadvertent

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disclosure of confidential information.

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IT IS SO ORDERED.
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Dated: January 3, 2017
______________________________________
MARIA-ELENA JAMES
United States Magistrate Judge

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United States District Court
Northern District of California

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