Regal Beloit America, Inc. et al v. Broad Ocean Motor LLC et al
MEMORANDUM AND ORDER IT IS HEREBY ORDERED that Plaintiffs Motion for Entry of a Protective Order (ECF No. 27) is GRANTED in part, and DENIED in part. A separate Protective Order shall issue. 27 Signed by District Judge Jean C. Hamilton on 1/4/17. (CLA)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
REGAL BELOIT AMERICA, INC., et al., )
BROAD OCEAN MOTOR LLC, et al.,
Case No. 4:16-CV-00111-JCH
MEMORANDUM AND ORDER
This patent infringement matter is before the Court on Plaintiffs Regal Beloit America,
Inc.’s and Jakel Motors Incorporated’s Motion for Entry of a Protective Order. (ECF No. 27.)
The Motion is fully briefed and ready for disposition. The Parties have agreed on all terms of the
proposed protective order except for three issues (1) whether the parties may file confidential
documents under seal without leave from the Court; (2) whether the protective should include a
provision requiring use of Hague Convention procedures; and (3) whether the protective order
should include a patent prosecution bar. The Court will discuss these issues in turn.
Filing Documents under Seal
Federal Rule of Civil Procedure 26(c)(1) authorizes the Court to enter a protective order
restricting discovery, and specifically identifies “confidential research, development, or
commercial information” as examples of the type of information for which good cause exists to
order that it “not be revealed or be revealed only in a specific way.” Rule 26(c) “confers broad
discretion on the trial court to decide when a protective order is appropriate and what degree of
protection is required.” Seattle Times Co. v. Rhinehart, 467 U.S. 20, 36 (1984). Local Rule 8313.05 states that “[u]pon a showing of good cause the Court may order that documents filed in a
civil case be received and maintained by the Clerk under seal.”
Plaintiffs request that the Court enter an order allowing the parties “to file confidential
documents under seal, rather than requiring the parties to seek permission piecemeal.”
Defendants on the other hand request that the Court enter an order requiring the Parties to seek
leave of Court each time they wish to file a document under seal. Upon consideration of the
Parties arguments, the Court will grant Defendants’ request.
Hague Convention Procedures
The Supreme Court has “decline[d] to hold as a blanket matter that comity requires resort
to Hague Evidence Convention procedures.” Societe Nationale Industrielle Aerospatiale v. U.S.
District Court, 482 U.S. 522, 544 (1987). A party seeking to include a provision requiring use of
Hague Convention procedures has the burden to “‘demonstrate appropriate reasons for
employing Convention procedures in the first instance, for some aspects of the discovery
process.’” See In re Auto. Refinishing Paint Antitrust Litig., 358 F.3d 288, 305 (3d Cir. 2004)
(quoting Societe Nationale, 482 U.S. at 547). Although the Court in Societe Nationale did not
“articulate specific rules to guide” whether adoption of Hague Convention procedures is proper,
a district court should consider “the particular facts, sovereign interests and likelihood that resort
to [Hague Convention] procedures will prove effective.” Societe Nationale, 482 U.S. at 544-46.
Defendants, as the proponents for inclusion of a provision requiring use of Hague
Convention procedures, bear the burden of showing that the adoption of such procedures is
Defendants concede, however, that “[a]t this early stage, and based upon their
investigation to-date,” they have not identified any documents or information requested by
Plaintiffs that would subject Defendant Zhongshan Broad Ocean Motor Co., Ltd. (“BOM”) to
potential civil or criminal liability, or that would otherwise be inconsistent with China’s
Declaration on accession to the Hague Convention. Defendants nevertheless contend that their
proposed provision should be included in the protective order, in effect as a contingency, because
Defendants do not “know what issues may arise in the future regarding Plaintiffs’ intended
litigation and discovery strategies,” and because BOM “desires to avoid potential civil or
criminal liability in China in connection with discovery.”
Since Defendants are unable at this juncture to identify any documents or information
requested by Plaintiffs that pose any civil or criminal lability issues in China, the Court finds that
Defendants’ proposed provision is premature at this stage in the litigation. See Autodesk, Inc. v.
ZWCAD Software Co. Ltd., No. 5:14-cv-01409-EJD, 2015 WL 1928184, at *7 (N.D. Cal. Mar.
27, 2015) (“ZWSoft’s concerns about the potentially overly broad nature of discovery Autodesk
may make in the future are not sufficient to justify imposition of the Hague Convention
procedures here.”) Therefore, the Court will deny Defendants’ request, without prejudice.
Patent Prosecution Bar
Patent prosecution bars address the concern over inadvertent disclosure arising in patent
infringement cases when trial counsel also represents the same client in prosecuting other,
usually related, patent applications before the United States Patent and Trademark Office
(“PTO”). See In re Deutsche Bank Trust Co. Americas, 605 F.3d 1373, 1377-78 (Fed. Cir.
The Federal Circuit has explicitly held that “the determination of whether a protective
order should include a patent prosecution bar” is an issue unique to patent law and therefore
governed by Federal Circuit law. Id.
The party seeking a patent prosecution bar bears the burden of showing good cause for its
inclusion in a protective order. See id. at 1378 (citing Fed. R. Civ. P. 26(c)). The proponent of
the bar must show that counsel’s representation of the client in matters before the PTO is likely
to implicate “‘competitive decisionmaking related to the subject matter of the litigation so as to
give rise to a risk of inadvertent use of confidential information learned in litigation.’” Clayton
Corp. v. Momentive Performance, Materials, Inc., No. 4:12CV1349 AGF, 2013 WL 2099437, at
*1 (E.D. Mo. May 14, 2013) (quoting Deutsche Bank, 605 F.3d at 1381). Competitive decision
making has been defined “counsel’s activities, association, and relationship with a client that are
such as to involve counsel’s advice and participation in any or all of the client’s decisions
(pricing, product, design, etc.) made in light of similar or corresponding information about a
competitor.” Deutsche Bank, 605 F.3d at 1378 (quotation omitted). It is “specific evidence—not
an inflexible rule—that supports a finding of competitive decision making.” Pfizer Inc. v.
Apotex Inc., 744 F. Supp. 2d 758, 765 (N.D. Ill. 2010) (citing Deutsche Bank, 605 F.3d at 1380).
Therefore, it is incumbent upon a party seeking a prosecution bar to provide such evidence. See
Clayton Corp., 2013 WL 2099437 at *2.
Defendants, as the proponents of the bar, bear the burden of persuasion here. Defendants
assert that the proposed patent prosecution bar is required because Plaintiffs directly compete
with Defendants; because discovery in this case will require that Defendants produce highly
confidential, proprietary, and trade secret documents related to the design and construction of the
accused products; and because Plaintiffs’ counsel seeks to handle future patent prosecution
regarding like technology and has worked on Plaintiffs’ patent applications, strategy, and
counseling in the past.
Plaintiffs assert that the language they present in their proposed protective order
prohibiting the use of any confidential information for purposes other than litigating this case and
any appeals is adequate to protect Defendants’ interests here, and that Defendants make no
showing that there is an unacceptable risk of inadvertent disclosure of confidential information.
Plaintiffs further argue that the proposed bar is overbroad and ambiguous, and that they will be
prejudiced by the imposition of such a bar because it will effectively preclude them from
obtaining legal counsel of their choice.
Upon consideration of the relevant case law and the record before it, the Court rejects
Defendants’ proposal to include a patent prosecution bar in the protective order. Defendants
have not met their burden of showing good cause for entry of such a bar. See Deutsche Bank,
605 F.3d at 1381 (“[A] party seeking imposition of a patent prosecution bar must show that the
information designated to trigger the bar, the scope of activities prohibited by the bar, the
duration of the bar, and the subject matter covered by the bar reasonably reflect the risk
presented by the disclosure of proprietary competitive information.”)
generalized assertions that the Parties are competitors, and that, absent a patent prosecution bar,
Plaintiffs’ patent prosecution counsel will inadvertently use the information they learn in this
litigation as they continue to work on Plaintiffs’ patent application, strategy, and counseling.
Defendants offer no specific evidence in support thereof. “The Court is unwilling to preclude
lawyers from litigating here or in front of the PTO on the basis of a vague and generalized threat
of future inadvertent misuse of discovered materials and in the absence of specific evidence that
Plaintiff’s counsel engages in competitive decision making.” Clayton Corp., 2013 WL 2099437
at *4 (“Defendants have not provided the Court with an affidavit, declaration, or any other form
of evidence on any issue related to the proposed prosecution bar…”); see also Pfizer, 744 F.
Supp. 2d at 768. The Court will therefore deny Defendants’ request for a patent prosecution bar,
IT IS HEREBY ORDERED that Plaintiffs’ Motion for Entry of a Protective Order
(ECF No. 27) is GRANTED in part, and DENIED in part. A separate Protective Order shall
Dated this 4th day of January, 2017.
/s/ Jean C. Hamilton
UNITED STATES DISTRICT JUDGE
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