Quaiz v. Rockler Retail Group, Inc.

Filing 33

Opinion and Order - Defendants' Motion to Compel Plaintiff to Identify Alleged Trade Secret(s) with Reasonable Particularity (ECF 26 ) is DENIED. Signed on 3/13/2017 by Judge Michael H. Simon. (mja)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON

MAJED QUAIZ,
Plaintiff,

Case No. 3:16-cv-1879-SI
OPINION AND ORDER

v.
ROCKLER RETAIL GROUP, INC., and
ROCKLER COMPANIES, INC.,
Defendants.
Brain Chenoweth, Brooks M. Foster, and Andrea R. Meyer, CHENOWETH LAW GROUP, PC, 510
SW Fifth Avenue, Fifth Floor, Portland, OR 97204. Of Attorneys for Plaintiff.
Klaus H. Hamm, KLARQUIST SPARKMAN, LLP, 121 SW Salmon Street, Suite 1600, Portland, OR
97204; John M. Weyrauch and Peter R. Forrest, DICKE, BILLIG & CZAJA, PLLC, 100 South Fifth
Street, Suite 2250, Minneapolis, MN 55402. Of Attorneys for Defendants.
Michael H. Simon, District Judge.
Majed Quaiz (“Plaintiff”) brings this lawsuit against Rockler Retail Group, Inc. and
Rockler Companies, Inc. (collectively “Rockler” or “Defendants”), alleging misappropriation of
trade secrets in violation of Or. Rev. Stat. §§ 646.461, 646.463 and 646.465 and common law
unjust enrichment. Before the Court is Defendants’ motion to compel Plaintiff to identify his

PAGE 1 – OPINION AND ORDER

alleged trade secrets with reasonable particularity and to stay discovery until he does so. For the
reasons discussed below, Defendants’ motion is denied.
STANDARDS
Rule 26(b)(1) of the Federal Rules of Civil Procedure provides in relevant part:
Parties may obtain discovery regarding any nonprivileged matter
that is relevant to any party’s claim or defense and 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.
Fed. R. Civ. P. 26(b)(1). Among the limitations stated in Rule 26(b)(2)(C) is the direction that
the court must limit the extent of discovery if it determines that the discovery sought is outside
the scope of Rule 26(b)(1) or if it is “unreasonably cumulative or duplicative, or can be obtained
from some other source that is more convenient, less burdensome, or less expensive.” Fed. R.
Civ. P. 26(b)(2)(C)(i). In addition, Rule 26 provides that the court may, for good cause, issue an
order to protect a party or person from oppression or undue burden, including “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).
BACKGROUND
In November 2011, Plaintiff designed a corner clamp for use in woodworking
(“Plaintiff’s Clamp”). Am. Compl. ¶ 8. As designed, Plaintiff’s Clamp holds two pieces of wood
together at a right angle without the aid of any additional structures. Id. Rockler solicits the
general public to submit design ideas, representing that their “philosophy is to support and
encourage inventors who bring innovation to the woodworking market. We do no steal ideas, and
we are willing to pay inventors for partnering with Rockler.” Id. at ¶ 10.
PAGE 2 – OPINION AND ORDER

After reviewing Rocker’s web page and representations, in mid-2012 Plaintiff
approached Rockler describing Plaintiff’s Clamp. Id. ¶¶ 11-12. Rockler responded by requesting
that Plaintiff submit images of his design. Id. ¶ 13. On July 13, 2013, in continued reliance on
Rockler’s representations from its website, Plaintiff submitted by email to Rockler 14 detailed
design drawings of Plaintiff’s Clamp. Id. ¶ 14. On August 8, 2012, Rockler declined to enter into
a business relationship with Plaintiff. Id. at ¶ 16.
Plaintiff does not allege and Rockler does not argue that Plaintiff submitted any other
ideas to Rockler or had any additional contacts with Rockler until this lawsuit. In August 2015,
Rockler began selling a new corner-clamping jig (“Rockler’s Clamp”). Id. at ¶ 20. Plaintiff
alleges that by making Rockler’s Clamp, Rockler misappropriated the design of Plaintiff’s
Clamp that Plaintiff provided to Rockler in July 2012. Id. at ¶¶ 21-22.
Plaintiff did not attach to his Amended Complaint copies of any of the 14 images that he
provided to Rockler in July 2012. Defendants state that after conducting a search for the images,
they were unable to locate them. ECF 26 at 7. Plaintiff’s attorney then provided copies of the 14
drawings to Defendants’ counsel. Id.
DISCUSSION
Plaintiff alleges that Defendants misappropriated Plaintiff’s trade secrets by using his
“concept, design, and photos to design and manufacture an altered version of [Plaintiff’s]
Clamp.” Am. Compl. ¶¶ 20-22. In their pending motion, Defendants argue that Plaintiff has
failed to plead the allegedly misappropriated trade secrets with sufficient particularity. In
support, Defendants advance three propositions. First, Defendants argue that Rockler’s Clamp
does not resemble or perform the same function as Plaintiff’s Clamp because it does not hold two
pieces of wood together without the aid of additional structures. Second, Defendants argue that
Plaintiff placed the design for his clamp in the public domain by applying for a patent, thereby
PAGE 3 – OPINION AND ORDER

failing to maintain the secrecy that is required for Plaintiff to maintain his claim. Third,
Defendants argue that Plaintiff did not sufficiently place Defendants on notice of the nature of
Plaintiff’s claims because Plaintiff’s pleadings identify only generic categories of trade secrets,
such as “plans, concepts, designs, specifications, and ideas.” Defendants request that Plaintiff be
ordered to clarify his allegedly misappropriated trade secrets. Defendants add that without
further clarification by Plaintiff, any discovery sought by Plaintiff would be nothing more than a
“fishing expedition.” Accordingly, Defendants request that the Court suspend Plaintiff’s right to
obtain formal discovery until Plaintiff has sufficiently clarified his alleged trade secret. Plaintiff
responds, among other things, that he has already sufficiently identified his claimed trade secrets
with reasonable particularity.
Many of Defendants’ arguments do not appear related to their motion to compel Plaintiff
to describe his alleged trade secrets with greater particularity. Defendants seem to challenge
Plaintiff’s claims on the merits, such as might be seen in a motion to dismiss for failure to state a
claim or a motion for summary judgment. Defendants also seem to challenge many of Plaintiff’s
other allegations as needing to be made more definite and certain. Defendants, however, already
have filed their Answer and asserted affirmative defenses. ECF 19, 20. Thus, we are past the
stage when it might have been appropriate for the Defendants to file motions under Rule 12(b)(6)
or Rule 12(e) of the Federal Rules of Civil Procedure. The only motion properly before the Court
now is Defendants’ motion that Plaintiff be required to describe his allegedly misappropriated
trade secrets with greater particularity and not be allowed to take formal discovery until he has
done so.
This Court previously addressed a similar issue in Nike, Inc. v. Enter Play Sports,
Inc., 305 F.R.D. 642 (D. Or. 2015). In that case, the Court found BioD, LLC v. Amnio Tech.,

PAGE 4 – OPINION AND ORDER

LLC, 2014 WL 3864658 (D. Ariz. Aug. 6, 2014), to be “particularly instructive for identifying
the criteria that a district court should consider in deciding this question.” Nike, 305 F.R.D.
at 645.
The court in BioD explained:
“[d]etermining whether a trade secret has been misappropriated
usually involves examining things that the other party considers its
own trade secrets. There is no privilege excepting trade secrets
from discovery, but courts must exercise discretion to avoid
unnecessary disclosures of such information. [P]laintiff will
normally be required first to identify with reasonable particularity
the matter which it claims constitutes a trade secret, before it will
be allowed (given a proper showing of need) to compel discovery
of its adversary’s trade secrets.”
BioD, 2014 WL 3864658, at *4 (quoting Dura Global Technologies, Inc. v. Magna Donnelly,
Corp., 2007 WL 4303294, at *2 (E.D. Mich. Dec. 6, 2007) ((alterations in BioD)).1 In Nike, the
Court found that the plaintiff had identified its trade secrets with reasonable particularity. See
Nike, 305 F.R.D. at 644, 646 (explaining that Nike’s complaint contained “numerous specifics,
including drawings and illustrations” and concluding that its “specifications of the trade secrets
at issue” were sufficiently particular).
U.S. District Judge Marco Hernandez also discussed the issue of whether a trade secret
has been described with reasonable particularity. See Vesta Corp. v. Amdocs Mgmt. Ltd., 147 F.
Supp. 3d 1147, 1155-56 (D. Or. 2015). In that case, Judge Hernandez described “reasonable
particularity” as requiring “‘a description of the trade secrets at issue that is sufficient to (a) put a
defendant on notice of the nature of the plaintiff’s claims and (b) enable the defendant to
determine the relevancy of any requested discovery concerning its trade secrets.’” Id. at 1155
1

The court in BioD also discussed circumstances in which a plaintiff might not be
required to identify its trade secrets with reasonable particularity before engaging in discovery.
Id. at *5. Because the Court finds that Plaintiff has identified his alleged trade secrets with
sufficiently reasonable particularity, there is no need further to address this alternative.
PAGE 5 – OPINION AND ORDER

(quoting BioD, 2014 WL 3864658, at *5). When determining “the degree of particularity that
must be disclosed in order for discovery to proceed in a trade secrets case,” there is “no
bright line answer[,] . . . each case is fact-intensive and the outcome is fact-specific.” Id. at 1150.
Applying here the two-pronged test described in Vesta, the Court finds Plaintiff’s
specifications of his trade secrets to be sufficient, at least to permit formal discovery to proceed.
First, Defendants have sufficient notice of the nature of Plaintiff’s claims. Plaintiff alleges that
Defendants used Plaintiff’s “concept, design, and photos to design and manufacture an altered
version” of Plaintiff’s Clamp. Plaintiff also identified the Rockler Clamp, which Plaintiff alleges
Defendants would have been unable to manufacture and sell without first seeing the design for
Plaintiff’s Clamp.
In addition, as the Court found significant in Nike, Defendants have already answered the
Amended Complaint and asserted affirmative defenses. See 305 F.R.D. at 646. Defendants did
not move to dismiss the Amended Complaint for failure to state a claim under Rule 12(b)(6) of
the Federal Rules of Civil Procedure, nor did Defendants move under Rule 12(e) to make the
allegations more definite and certain. See id. Plaintiff also submitted only one design to Rockler.
Although Plaintiff’s complaint does not include images of his clamp, Plaintiff promptly
provided 14 drawings when informed that Rockler did not retain the design that Plaintiff
previously submitted.2 Under these facts, Defendants have sufficient notice of Plaintiff’s claim.
Further, Plaintiff’s description of his trade secrets is sufficient to enable Defendants to
“determine the relevancy of any requested discovery concerning its trade secrets.” Vesta, 147 F.
Supp. 3d at 1155. For purposes of this case, Plaintiff has only one relevant invention that may
2

Defendants argue in their reply that the first email that Plaintiff sent to Rockler did not
describe a clamp “design” and merely explained the benefit of such a design. In light of the
copies of the 14 drawings that Plaintiff later provided to Rockler, however, this is argument is
unpersuasive.
PAGE 6 – OPINION AND ORDER

contain relevant trade secrets. Plaintiff provided Rockler with detailed drawings of Plaintiff’s
invention, which Plaintiff also referenced in his pleadings. For all of these reasons, Plaintiff has
sufficiently described his allegedly misappropriated trade secrets with reasonable particularity.
Formal discovery may proceed.
CONCLUSION
Defendants’ Motion to Compel Plaintiff to Identify Alleged Trade Secret(s) with
Reasonable Particularity (ECF 26) is DENIED.
IT IS SO ORDERED.
DATED this 13th day of March, 2017.
/s/ Michael H. Simon
Michael H. Simon
United States District Judge

PAGE 7 – OPINION AND ORDER