Chicago IP Attorney & Lawyer : R. David Donoghue : Chicago IP Litigation Blog

Judge Moran granted plaintiff Trading Technologies' (“TT”) motion for a protective order, but denied its request for its fees related to the motion. TT used two videos of third part Walter Brumfield's trading screen and a portion of one of Brumfield's daily trading records (collectively the “Evidence”) as evidence during the Court's inequitable conduct bench trial. Despite prior designation as “Attorneys' Eyes Only” pursuant to a protective order and having been sealed in the parties' previous filings, the Evidence was presented in open court without any protections. Additionally, it was designated on exhibit lists submitted in connection with the bench trial without any confidentiality designation.

The first business day after the bench trial, TT contacted defendant eSpeed to confirm that the Evidence was to be treated as confidential. But eSpeed, and the other defendants in the related cases, objected arguing that by using the Evidence at trial without any protections or designations, TT waived confidentiality.

The Court acknowledged a “strong presumption of public access to court proceedings and records . . . .” But noting that the presumption is not absolute and that the parties seeking disclosure here were defendants not the press or public, the Court held that the Evidence retained its confidential status for the following reasons:

• The videos showing Brumfield's custom-designed computer screen configuration was a trade secret and its disclosure could harm Brumfield's competitive trading advantage;

• TT's public disclosure of the Evidence was inadvertent as evidenced by the numerous times the Evidence was previously treated as confidential; and

• To the extent the Court relied on the Evidence in its opinion (click here to read the Blog's post about the opinion), it did not do so in sufficient technical detail to disclose the confidential elements of the Evidence.

Additionally, the Court noted that while Brumfield's attorney did receive copies of the exhibit list showing the Evidence without confidentiality designations and TT had periodically represented Brumfield's interest throughout the case, neither Brumfield nor his counsel were in attendance to object when the Evidence was used during the bench trial. The Court does not specifically say whether or how these facts played into its decision. But the facts were included in the Court's description of the facts and, therefore, the Court appears to have considered them relevant.

* Click here to read much more about this case in the Blog’s archives and click here for this opinion.

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Trading Techs. Int’l, Inc. v. eSpeed, Inc., No. 04 C 5312, Min. Order (N.D. Ill. Feb. 20, 2008) (Moran, Sen. J.).*

I have received several emails asking about the status of this case and, specifically, when the inequitable conduct portion of the case will be decided.  The post-trial inequitable conduct briefing appears to be complete -- if you want to read the briefs, they are largely available on Pacer.  So, unless the Court asks for further briefing or an additional hearing either of which seem unlikely, the Court will consider the evidence and the parties' post-trial papers, and then write an opinion deciding the inequitable conduct issues.  There is not any way to accurately predict when the opinion will issue.  The timing is governed by numerous factors, including the complexity of the case and the size of the Court's current docket. 

Additionally, the parties have filed other motions which the Court will also have to decide.  For example, Trading Technologies ("TT") filed a motion for a protective order sealing certain evidence that was produced as "Highly Confidential," but which was put into evidence and used without immediate restriction or objection, as to confidentiality, during the public trial.  I will keep you updated as the Court issues any decisions regarding inequitable conduct or any other issues in the case.

* Click here to read much more about this case in the Blog’s archives.

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Degregorio v. Phillips Electronics. N. Am. Corp., No. 07 C 2683, Slip Op. (N.D. Ill. Dec. 28, 2007) (Cox, Mag. J.).

Judge Cox granted in part defendants’ motion for a protective order regarding plaintiff’s subpoenas of defendants’ customers in this patent dispute. Plaintiff subpoenaed defendants’ customers of allegedly infringing hair trimmers with built in vacuums, seeking sales and inventory information, as well as promotional materials and purchase orders. The Court denied the motion as to the sales and inventory information. The customers’ sales were potentially relevant to commercial success of the patented device for plaintiff’s non-obviousness case. The Court did enter a protective order as to the request for purchase orders and marketing materials. The Court held that the purchase orders were cumulative of the other requested sales information and marketing materials were too tangential to commercial success to be discoverable.

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Trading Techs. Int'l., Inc. v. eSpeed, Inc., No 04 C 5312, 2007 WL 1628352 (N.D. Ill. Mar. 1, 2007) (Moran, Sen. J.).

Judge Moran denied plaintiff Trading Technologies' ("TT") motion for a protective order to prevent the deposition of Robert Klinger, related to defendant eSpeed's inequitable conduct defense (more on this case in the Blog's archives).  The Court held that discovery is a "balancing act."  eSpeed's assertion that Klinger was involved in drafting a response to a USPTO Office Action at the center of its inequitable conduct claim outweighed TT's best argument -- that the deposition was duplicative because defendants had deposed or have scheduled the depositions of two lead outside patent prosecutors, TT's in-house patent prosecutor and the relevant patent examiner.  The Court also noted that the case is approaching the discovery close, so we may start seeing fewer discovery motions in the case and more substantive motions.

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Autotech Techs. Ltd. Partnership v. Automationdirect.com, Inc. 237 F.RD. 405 (N.D. Ill. 2006). (Cole, Mag. J.).

In this impressively detailed opinion, Magistrate Judge Cole grants defendant's motion for a protective order limiting plaintiff's in-house counsel's access to sensitive customer information and communications.  The parties faced a common problem, they had agreed that customer information, including customer identities and communications, would be limited to attorneys' eyes only, but could not agree as to whether plaintiff's in-house counsel could access the information.  Plaintiff argued that its in-house counsel played a lead role in the case and, therefore, required access to the information.  Defendant argued that in-house counsel were corporate decision makers, in addition to counselors, and would not be able to separate the knowledge of defendant's customers they would be exposed to when performing business-related functions.

The Court first stated that it believed counsel's assurances that they would not violate the Court's protective order or their ethical obligations, noting that that was "the beginning and not the end of [the] analysis."  The Court held that:

. . . proper analysis requires a careful and comprehensive inquiry into in-house counsel's actual (not nominal) role in the affairs of the company, his association and relationship with those in the corporate hierarchy who are competitive decision makers, and any other factor that enhances the risk of inadvertent disclosure.  That risk must then be balanced against the harm that will result to the party employing in-house counsel from restrictions on the latter's access to the protected information.

The Court then performed a detailed analysis of plaintiff's counsel's responsibilities and place in plaintiff's corporate hierarchy.  The Court ultimately held that in-house counsel could not have access to customer information because of in-house counsel's central importance to plaintiff and because restricting access would not harm plaintiff's ability to litigate the case. 

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