ACI Worldwide Corp. v. MasterCard Technologies, LLC et al

Filing 120

ORDER - 1. Plaintiff's Motion for a Protective Order (filing 49 ) is granted, in part. A joint proposed protective order, incorporating the rulings herein, shall be forwarded to the undersigned by email, in word or word perfect format, for co nsideration by or before February 9, 2015. 2. Plaintiff's Motion to Compel (filing 54 ) is granted, in part, as set forth above. Attorneys fees and costs will not be awarded. 3. Defendants' Motion to Compel (filing 73 ) is denied. 4. Plaintiff's Motion to Treat Trade Secret Exhibits as Filed in Support of its Motion for Protective Order (filing 112 ) is granted. Ordered by Magistrate Judge F.A. Gossett. (JAB)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
ACI WORLDWIDE CORP.,
Plaintiff,
V.
MASTERCARD TECHNOLOGIES,
LLC, and MASTERCARD
INTERNATIONAL, Incorporated,
Defendants.

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8:14CV31

ORDER

This matter is before the Court on (1) Plaintiff’s Motion for a Protective Order (filing
49); (2) Plaintiff’s Motion to Compel (filing 54); (3) Defendants’ Motion to Compel (filing
73); and (4) Plaintiff’s Motion to Treat Trade Secret Exhibits as Filed in Support of its
Motion for Protective Order (filing 112).
1.

Plaintiff’s Motion for Protective Order

The parties agree that a protective order should be entered in this case. However, the
parties disagree as to the provisions which should be included in the protective order.
Specifically, Plaintiff argues that there should not be an “Attorneys Eyes Only” (“AEO”)
designation for certain confidential information produced in this case. Plaintiff further
contends that it should be permissible for information obtained in a related Nebraska state
court action to be used in this case, and for information obtained in this case to be used in the
state court action.
Defendants believe that, given the highly sensitive nature of documents that will be
exchanged, an AEO designation, which limits the disclosure of certain documents to
attorneys of record, is proper. Plaintiff argues that this level of protection is unnecessary and
will prevent its employees with advanced technical information regarding the software at
issue, particularly an employee named Mark Newsom, from interpreting and analyzing

produced documents. The Court understands Plaintiff’s desire to have input from employees
with specialized knowledge regarding the software. However, given the nature of the
anticipated document production, as well as the fact that the parties to this action still have
a business relationship, the Court believes an AEO designation is appropriate. However,
Plaintiff should not be left without remedy in the event it believes that certain information
requires employee review. Therefore, the protective order entered in this case should include
a provision which allows Plaintiff to challenge the AEO designation for specific documents.
Nevertheless, to avoid an inevitable discovery dispute, the Court will allow Mark Newsom
access to documents designated as AEO. This exception should be included in the parties’
proposed protective order.
Plaintiff also argues that the materials discovered in the federal and state actions
should be used interchangeably. In the state court case, to which Defendants are not a party,
Defendants produced thousands of documents pursuant to a subpoena. Plaintiff also deposed
several of Defendants’ employees. Plaintiff believes that Defendants will produce many of
the same documents in this action, and some of the same witnesses who were deposed in the
state action will also be deposed in this action. Therefore, according to Plaintiff, it is
practical to allow the information to be used interchangeably.
The Court will not allow information to be used as requested by Plaintiff. Given the
related issues involved in the state and federal litigation, use of discovered information as
suggested by Plaintiff may make sense in some instances. However, the protective order
entered in the state court action expressly provides that confidential information produced
in that action may only be used in that litigation. This Court will not interfere with the
protective order entered in state court. Therefore, the Court will not grant the parties an
absolute right to use all documents interchangeably in the two suits. If this leads to duplicate
production in certain instances, so be it. Of course, the parties may still confer and take
appropriate steps to avoid this problem.
2.

Motions to Compel

Under the federal rules, parties to a lawsuit may obtain discovery regarding any
matter, not privileged, that is relevant to a claim or defense of any party. Fed. R. Civ. P.
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26(b)(1). Relevancy is broadly construed and “[d]iscovery requests should be considered
relevant if there is any possibility the information sought is relevant to any issue in the case
and should ordinarily be allowed, unless it is clear the information sought can have no
possible bearing on the subject matter of the action.” Met-Pro Corp. v. Industrial Air
Technology, Corp., No. 8:07CV262, 2009 WL 553017, * 3 (D. Neb. March 4, 2009).
The motions to compel involve two primary issues: (1) the absence of a protective
order and (2) Defendants’ assertion that Plaintiff has failed to identify its alleged trade secrets
with sufficient detail. Because the Court has now defined the appropriate scope of the
protective order, objections based on the absence of a protective order will, upon entry of the
protective order, be moot. Thus, the remaining issue to be decided is whether Plaintiff has
sufficiently identified its trade secrets.
Defendants argue that before meaningful discovery commences, Plaintiff should be
required to describe, with reasonable particularity, the trade secrets it alleges have been
misappropriated. Defendants maintain that Plaintiff’s responses to Defendants’ Interrogatory
Nos. 1 and 3, which seek particularized identification of the purported trade secrets, are
deficient. Plaintiff disagrees, asserting that it clearly identified the trade secrets from the
beginning of this action. Plaintiff claims it identified them in its Amended Complaint.
Moreover, Plaintiff maintains that, in an effort to progress the case, and in response to
Defendants’ assertions regarding the alleged lack of specificity, it supplemented its original
interrogatory responses with a lengthy “Verified Trade Secret Statement” (the “Statement”),
as well as other documents identifying the allegedly misappropriated trade secrets. Since
producing the Statement, and in response to Defendants’ ongoing complaints regarding the
sufficiency of Plaintiff’s disclosures, Plaintiff also submitted a response to a “Trade Secret
Appendix” offered by Defendants in connection with the pending motions. Defendants’
Appendix details alleged deficiencies in Plaintiff’s trade secret identification. Plaintiff’s
response to the Appendix sets forth citations to the relevant pages from the other trade secret
filings in a further effort to satisfy Defendants.
The Court has reviewed the law cited by the parties regarding the particularity
required for commencement of discovery in trade secret cases. Having done so, the Court
concludes that, under the circumstances presented here, Plaintiff’s descriptions are
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sufficiently specific. Plaintiff has seemingly gone to great lengths to address Defendants’
continuing concerns. Moreover, given the history between the parties, and the related state
court action in which Defendants participated, the Court is confident that Defendants have
sufficient information to allow discovery to proceed. In addition, as pointed out by Plaintiff,
not only does this case involve allegations of misappropriation, but it also deals with
allegations of breach of contract and confidentiality. This action was initiated a year ago, yet
it appears that little discovery has taken place. Discovery needs to move forward regarding
all claims. Accordingly, Defendants’ Motion to Compel will be denied.
In addition to Defendants’ objections regarding the absence of a protective order and
Plaintiff’s failure to sufficiently identify the trade secrets at issue, Defendants raised a
number of other objections to Plaintiff’s document production requests. In an effort to get
discovery moving, Plaintiff has volunteered to narrow its document production requests for
the time being. Plaintiff proposes that, at this time, Defendants only be required to produce
relevant emails, including the attachments thereto, that Defendants sent to Baldwin Hackett
& Meeks, Inc. (“BHMI”). Plaintiff’s proposed approach seems reasonable. Accordingly,
by or before February 9, 2015, Plaintiff shall provide Defendants with revised discovery
requests, in accordance with the limitations it now proposes. Upon receipt and review of the
documents produced in response to these revised requests, Plaintiff may renew and/or revise
its previous document production requests. As noted above, Defendants’ objections
regarding the absence of a protective order and Plaintiff’s failure to specifically identify trade
secrets are overruled. A privilege log shall accompany Defendants’ supplemental discovery
responses in the event privileges are asserted. Defendants may assert other objections to the
supplemental discovery requests, but they shall do so in keeping with the rulings set forth in
this Order.
Accordingly,
IT IS ORDERED as follows:
1.

Plaintiff’s Motion for a Protective Order (filing 49) is granted, in part. A joint
proposed protective order, incorporating the rulings herein, shall be forwarded
to the undersigned by email, in word or word perfect format, for consideration
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by or before February 9, 2015.
2.

Plaintiff’s Motion to Compel (filing 54) is granted, in part, as set forth above.
Attorneys’ fees and costs will not be awarded.

3.

Defendants’ Motion to Compel (filing 73) is denied.

4.

Plaintiff’s Motion to Treat Trade Secret Exhibits as Filed in Support of its
Motion for Protective Order (filing 112) is granted.

DATED February 2, 2015.
BY THE COURT:
S/ F.A. Gossett
United States Magistrate Judge

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