Raytheon Company et al v. Cray Inc.

Filing 23

MEMORANDUM DECISION AND ORDER denying 2 Adaptive Computer Enterprises, Inc.'s Motion to Quash Plaintiff Raytheon Company's Subpoena. The court also DENIES Adaptives request for the fees and costs and associated with bringing this motion. The court further ORDERS Raytheon to reimburse Adaptive for reasonable out of pocket expenses in providing the information it seeks. Signed by Magistrate Judge Brooke C. Wells on 1/30/17. (dla)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH, CENTRAL DIVISION
RAYTHEON COMPANY,

MEMORANDUM DECISION AND ORDER
DENYING MOTION TO QUASH

Plaintiff,
v.

Case No. 2:16-mc-0898 DAK

CRAY, INC.,

District Judge Dale A. Kimball
Defendant.

Magistrate Judge Brooke Wells

This matter is referred to the undersigned from Judge Dale A. Kimball in accordance
with 28 U.S.C. 636(b)(1)(A). Before the court is nonparty Adaptive Computing Enterprises,
Inc.’s Motion to Quash Plaintiff Raytheon Company’s subpoena. 1 Adaptive also moves for the
costs and fees associated with bringing this motion. As set forth below the court denies
Adaptive’s Motion to Quash.
BACKGROUND
Plaintiff Raytheon is a technology and innovation company in the defense, civil,
government and cybersecurity markets. One aspect of its business is high-performance
computing (HPC) or supercomputers. Among the many patents that Raytheon holds are those
that focus on HPC system architecture (Patent Nos. 8,335,909 and 9,037,833) and those that
focus on fault recovery and job management processes for these systems (Patent Nos. 7,475,274
and 8,190,714).
Raytheon filed suit in the Eastern District of Texas against Defendant Cray, Inc. alleging
infringement of the ‘909, ‘833, ‘274 and ‘714 patents through Cray’s sale of various HPC

1

Docket no. 2.

systems, including those sold with Adaptive’s Moab software. 2 In Raytheon’s Infringement
Contentions in the parent case it identifies certain Cray supercomputers that use the Moab
software developed by Adaptive and PBS Professional software developed by Altair.
In February Defendant Cray was required under the Eastern District of Texas’ Patent
Rules to provide “’source code, specficiations, schematics, flow charts, artwork, formulas, or
other documentation sufficient to show the operation of any aspects or elements of an Accused
Instrumentality.’” 3 During the continuing discovery disputes between Cray and Raytheon, Cray
informed Raytheon that it did not locate any of the source code for Moab and PBS
Professional. 4 Raytheon then sought this source code from third-parties Adaptive and Altair. A
subpoena was issued to each on May 13, 2016.
Altair expressed concerns about the protections found in the original protective order if it
produced its source code. Eventually, an amended protective order was negotiated between
Raytheon and Cray and subsequently entered. This protective order "’more-expressly clarif[ied]
that third parties, such as Altair [and Adaptive], may enjoy the same level of protection under the
Order as do Cray and Raytheon.’" 5 With those changes and enhanced protections, Altair agreed
to make its source code available for Raytheon to inspect. Adaptive refused, however, to provide
the Moab source code and instead pointed Raytheon to an open source product called

2

See Op. p. 2.

3

Id. p. 3 (quoting Eastern District Patent Rule 3-4(a)).

4

See id.

5

Id. p. 4 (quoting Stringfield Decl. ¶13).

2

TORQUE. 6 According to Adaptive, Moab does not interface directly with Cray machines and
instead uses TORQUE to communicate and interface with the Cray machines. 7
After examining TORQUE Raython informed Adaptive that it does not replace Moab’s
job scheduler functionality that is part of the Accused Instrumentalities in the parent case. So,
Raytheon continued to seek access to the Moab source code. Adaptive refused and this motion
followed.
DISCUSSION
Rule 45(d)(3)(B)(i) provides that a court may “quash or modify the subpoena if it
requires: (i) disclosing a trade secret or other confidential research, development, or commercial
information.” 8 However, “there is no absolute privilege for trade secrets and similar confidential
information.” 9 Rather once it is established that the information sought is a trade secret or
sensitive commercial information, the requesting party must establish that the information is
relevant and necessary. 10 This court must balance “’the relevance of the discovery sought, the
requesting party’s need and the potential hardship to the party subject to the subpoena’” 11 while
keeping in mind that the “burden is particularly heavy to support a ‘motion to quash as
contrasted to some more limited protection.’” 12
There is no dispute that Adaptive’s Moab source code is a protected trade secret, which
makes logical sense, because source code is often “a company’s crown jewel, the shining star in
6

Open source code is distributed at no cost although it may be bound by the terms of the GNU General Public
License (GPL). The GPL puts restrictions on the modification and subsequent distribution of freeware programs.

7

Id. p. 4-5.

8

Fed. R. Civ. P. 45(d)(3)(B)(i).

9

Federal Open Market Committee v. Merrill, 443 U.S. 340, 362 (1979) (quotation omitted).

10

See Centurion Industries, Inc. v. Waren Steurer and Assoc., 665 F.2d 323, 325 (10th Cir. 1981).

11

Truswal Systems Corp. v. Hydro-Air Engineering, INc., 813 F.2d 1207, 1210 (Fed. Cir. 1987) ((quoting Heat &
Control, Inc. v. Hester Indus., Inc., 785 F.2d 1017, 1024 (Fed. Cir. 1986));
12

Id. (quoting Westinghouse Electric Corp. v. City of Burlington, 351 F.2d 762, 766 (D.C.Cir. 1965)).

3

the constellation of a computer program’s intellectual property rights.” 13 Adaptive argues that
Raytheon has failed to show a substantial need for the “highly sensitive and confidential source
code.” 14
The court agrees with Raytheon that the Moab source code is relevant especially given
that “relevancy is more broadly construed during discovery than at trial.” 15 The court finds that
Raytheon has also established a need for the Moab source code. It is part of the Accused
Instrumentalities in the parent case and there is no other source for the code other than Adaptive.
The court is also persuaded that the hardship is minimal especially given two facts. First, there is
an amended protective order that provides enhanced protections for third-parties. Such
protections are adequate for Altair to produce its requested source code for PBS Professional.
Second, Raytheon has agreed to reimburse Adaptive for its reasonable out of pocket expenses in
complying with the subpoena. This will reduce the cost and burden on Adaptive.
Finally the court finds that Raytheon has taken reasonable steps to avoid imposing undue
burden or expense. 16 For example, as previously noted, Raytheon agreed to reimburse Adaptive
for reasonable out of pocket expenses in collecting the information it seeks. 17 And based on the
record it appears Raytheon did investigate the open-source TORQUE software and how it is used
in conjunction with Moab. Contrary to Adaptive’s arguments, the mere fact that Raytheon
persists in its request for the Moab source code, does not by itself lead to the imposition of fees.
The court will therefore deny the request for fees and costs with bringing the motion.

13

Mtn. p. 7, docket no. 2.

14

Reply p. 2, docket no. 19.

15

Master Palletizer Systems, Inc. v. T.S. Ragsdale Co. Inc., 123 F.R.D. 351, 353 (D.Colo. 1988) ; see also Centurion
Industries, Inc. v. Warren Steurer and Assoc., 665 F.2d 323, 326 (10th Cir. 1981).
16

See Fed. R. Civ. P. 45(d)(1).

17

See Stringfield Decl. ¶ 15, docket no 13.

4

ORDER
For these reasons, the court DENIES Adaptive’s Motion to Quash Raytheon’s Subpoena.
The court also DENIES Adaptive’s request for the fees and costs and associated with brining this
motion. The court further ORDERS Raytheon to reimburse Adaptive for reasonable out of
pocket expenses in providing the information it seeks. 18

DATED this 30 January 2017.

Brooke C. Wells
United States Magistrate Judge

18

The court is hopeful that the parties can work out what exactly are reasonable out of pocket expenses without
further court intervention.

5