TECNOMATIC, S.P.A. v. REMY, INC. et al

Filing 137

ORDER denying Pltf's 130 Motion to Compel (See Order). Signed by Magistrate Judge Mark J. Dinsmore on 9/27/2011. (SWM)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION

TECNOMATIC, S.P.A.,

)
)
)
) NO. 1:11-cv-00991-SEB-MJD
)
)
)
)
)
)
)
)
)
)
)
)
)

Plaintiff,
vs.
REMY, INC.,
HANSON SYSTEMS, LLC D/B/A EAGLE
TECHNOLOGIES GROUP,
ODAWARA AUTOMATION, INC.,
REMY INTERNATIONAL, INC.,
DELCO REMY MEXICO, S.R.L. DE
C.V.,
REMY COMPONENTES S. DE R.L. DE
C.V.,
1-10 DOES,
Defendants.

Order on Pending Motion
This matter comes before the Court on Tecnomatic S.p.A’s Motion to Compel Access to
All Production Components. [Dkt. 130] The Court, being duly advised, now DENIES the
motion for the reasons set forth below.
I.Background
In 2004, Remy, Inc. (“Remy”) engaged Tecnomatic S.p.A. (“Tecnomatic”) to design and
manufacture a production system for parts for an electric motor. After Tecnomatic delivered
most of the ordered components, Remy alleged that the equipment was delivered late and did not
meet specifications. Remy discontinued use of several of the components it had purchased from
Tecnomatic and replaced them with components made by other manufacturers. Remy then
brought suit against Tecnomatic for breach of contract and breach of express and implied
warranties.

1

In August, 2009, Remy and Tecnomatic moved for the entry of an agreed protective order to
preserve the confidentiality of proprietary information and trade secrets during litigation. [081227 Dkt. 44.] The protective order defined what information could be designated as
“confidential” and “highly confidential,” and outlined the procedures to be followed for
appropriately designated information in each category. [08-1227 Dkt. 45.]
The dispute resulting in Tecnomatic’s Motion to Compel Access to All Production
Components arose after Remy designated its Phase II production line as “highly confidential”
and barred one of Tecnomatic’s in-house engineers, Maurillio Micucci, from examining the line
in its entirety. An outside expert hired by Tecnomatic was, however, permitted to inspect the
equipment. Tecnomatic contends that it will be prejudiced if Mr. Micucci is not permitted to
examine the Phase II equipment. Tecnomatic also contends that Remy waived its right to
designate the line as “highly confidential” due to its belated designation and prior disclosure of
information regarding its manufacturing process.
II.Discussion
A protective order allows a party to litigation to protect trade secrets and other
confidential information in order to preserve its competitive advantage. The Federal Rules of
Civil Procedure permit the Court to enter a protective order “requiring that a trade secret or other
confidential research, development, or commercial information not be revealed or be revealed
only in a specified way.” Fed. R. Civ. P. 26(c)(1)(G).
More than two years ago, Remy and Tecnomatic voluntarily agreed to abide by an order
to protect their respective trade secrets and other confidential information during the course of
the present dispute. [08-1227 Dkt. 45.] The protective order states that “current and past …
methods, procedures, and processes relating to the manufacture or production of automotive
equipment, parts, or systems” may be designated as “highly confidential.” [Id. at 4.] The order
dictates that “highly confidential” information may be shared with certain individuals involved
in the litigation, including experts retained to assist with the litigation. [Id.] However, the order
stipulates that such an expert cannot be a current employee of the party. [Id. at 4-5.]
Remy’s current Phase II manufacturing process clearly qualifies as information which
may be designated as “highly confidential” under the protective order. Therefore, Remy is
2

entitled to exclude an employee of Tecnomatic, such as Mr. Micucci, from accessing
information related to that manufacturing process. This outcome is consistent with the original
objective for imposing the protective order – to protect the parties’ trade secrets and competitive
advantages.
Tecnomatic has argued that, regardless of the clear parameters for disclosure set out in
the protective order, Mr. Micucci should now be permitted to inspect the Phase II equipment to
avoid prejudice to Tecnomatic’s case. However, if Tecnomatic intended to rely on Mr.
Micucci’s testimony regarding the Phase II equipment, it should have addressed the issue in the
protective order at the time it was originally proposed. Tecnomatic agreed to the protocols set
forth in the protective order, and Remy was entitled to rely upon that agreement in enforcing that
protocol now. Tecnomatic knew as early as August, 2009, when the protective order was
entered that, if it elected to rely upon an in house expert, such as Mr. Micucci, such expert would
not be allowed access to information, such as the Plase II equipment, which met the protective
order’s definition of “highly confidential.” The risk that Remy would designate the Phase II line
as “highly confidential” was one that Tecnomatic assumed when it chose to rely upon Mr.
Micucci instead of an outside expert. In any event, it appears that Tecnomatic’s case will not be
prejudiced by Mr. Micucci’s inability to inspect the Phase II equipment, because Tecnomatic’s
outside expert has inspected the Phase II line in its entirety and may testify regarding his
impressions with regard thereto.
Tecnomatic has also argued that Remy waived its right to designate the process as
“highly confidential.” Tecnomatic bases this argument on two factors. First, Tecnomatic alleges
that Remy waived its right by waiting too long to designate the process “highly confidential.”
However, the timing of Remy’s designation is not a consideration here. It should have been
obvious from the time the parties agreed to the order that, according to the clear and
unequiviocal language of the protective order, Remy’s current manufacturing process would be
protected as “highly confidential.” Additionally, Remy made the designation at the point
Tecnomatic attempted to have Mr. Micucci analyze the equipment; the Court finds Remy’s
designation to have been timely in the circumstances.
Second, Tecnomatic alleges that Remy waived its right to designate the Phase II lines as
“highly confidential” when it allowed Mr. Micucci to be present during deposition testimony in
3

which the Phase II process was described. This argument also fails. The information relayed
during the testimony was of a general nature, and an engineer could not have replicated the
Phase II equipment merely from hearing the testimony at the deposition. In contrast, it is
plausible that an engineer could build similar equipment after completing a thorough, direct
inspection of a competitor’s machinery. Direct inspection by Tecnomatic’s in-house engineer is
much more likely to result in the loss of Remy’s competitive advantage. Therefore, Remy was
justified in allowing generalized information regarding the system to be disclosed yet barring
complete disclosure of a visual inspection of the equipment to Tecnomatic’s employee. Remy
has not waived its right to designate the Phase II equipment as “highly confidential.”
III.Conclusion
For the reasons stated above, Tecnomatic’s Motion to Compel Access to All Production
Components is DENIED. [Dkt. 130]

Dated:

09/27/2011
Mark J. Dinsmore
United States Magistrate Judge
Southern District of Indiana

Distribution List:
David M. Allen
BAKER & DANIELS LLP-Chicago
[e-mail]
Kara E. F. Cenar
BRYAN CAVE LLP
[e-mail]
Donald Cole
Byan Cave LLP.
[e-mail]
Ryan Michael Hurley
BAKER & DANIELS - Indianapolis
[e-mail]
David P. Irmscher
BAKER & DANIELS
[e-mail]
Colby Anne Kingsbury
4

BAKER & DANIELS LLP
[e-mail]
Thomas A. Knoth
THOMPSON HINE LLP
[e-mail]
S. Patrick McKey
BRYAN CAVE LLP
[e-mail]
Patrick David Murphy
BOVERI MURPHY RICE LLP
[e-mail]
Fred Anthony Paganelli
TAFT STETTINIUS & HOLLISTER LLP
[e-mail]
Charles P. Rice
BOVERI MURPHY RICE, LLP
[e-mail]
Mariangela M. Seale
BRYAN CAVE LLP
[e-mail]
Trina Kissel Taylor
BAKER & DANIELS LLP-Chicago
[e-mail]
Andrew C. Warnecke
Bryan Cave LLP
[e-mail]
Scott A. Weathers
THE WEATHERS LAW OFFICE
[e-mail]
Joseph H. Yeager Jr
BAKER & DANIELS - Indianapolis
[e-mail]
Paula L Zecchini
BRYAN CAVE LLP
[e-mail]

5