Opinion
No. 2014-CV-00604
01-28-2016
Vention Advanced Medical Components, Inc., d/b/a Advanced Polymers v. Nikolaos D. Pappas and Ascend Medical, Inc.
ORDER
Two discovery disputes are pending before the Court. First, the parties dispute whether or not certain employees of the Plaintiff, Vention Advanced Medical Components Inc., d/b/a Advanced Polymers ("Advanced Polymers"), are expert witnesses within the meaning of RSA 516:29-b, so that they are required to provide expert reports. Second, Advanced Polymers moves to compel answers to Interrogatories 1 through 7 and Requests for Production 1 through 4, which in substance, require Defendants, Nikolaos D. Pappas and Ascend Medical, Inc., to specify the documents upon which they rely to support their claim and counterclaim that Advanced Polymers' supposed trade secret is not a trade secret at all, but is easily ascertainable from documents in the public domain.
On January 8, 2016, Advanced Polymers also sought a status conference to discuss the expert witness dispute by letter brief in accordance with Business Court Standing Order 10. Defendants responded, Plaintiff replied, and a hearing was held on January 22, 2016, after which the parties agreed that the Court could decide the substantive issue raised by the parties' letter briefs in order to advance the conduct of the litigation. For the reasons stated in this Order, the Court orders that Plaintiff shall provide an expert disclosure from Mark Saab with respect to Subject 8 and Subject 14 of Plaintiff's identification of Mark Saab as a non-retained expert, filed on December 11, 2015, to the extent his testimony with respect to area number 14 involves "testimony concerning those topics concerning defendant." Similarly, Mr. Testa and Mr. Girarde, other employee expert witnesses disclosed by Advanced Polymers, must provide expert reports within the meaning of RSA 516:29-b if they opine regarding the Defendant's costs involved in developing and marketing its products and its profit margin, as explained in the body of this Order.
Advanced Polymers sought a status conference to discuss the interrogatories and request for production at issue by letter brief dated December 2, 2015. After a status conference on December 22, 2015, the parties briefed the issue and agreed that the Plaintiffs opening letter brief would be treated as a Motion to Compel. For the reasons stated in this Order, the Motion to Compel is GRANTED and Defendants shall answer the Interrogatories and Requests for Production referenced in the letter brief.
I
This case involves a claim by the Plaintiff that the Defendant Nikolaos Pappas, a former employee of Plaintiff, is utilizing trade secrets to which he was given access during his employment by Plaintiff. Both parties agree that RSA 516:29-b is applicable to disclosure of expert testimony to be produced in this case. RSA 516:29-b, II provides in relevant part:
Except as otherwise stipulated or directed by the court, this disclosure shall, with respect to a witness who is retained or specially employed to provide expert testimony in the case or whose duties as an employee of the party
regularly involve giving expert testimony, be accompanied by a written report signed by the witness.
On December 9, 2016 the parties stipulated that:
With respect to any person any party may use at trial to present evidence under New Hampshire rules of evidence 702, 703 or 705 who is not required to provide a report pursuant to RSA 516:29-B, each party shall identify each person who may provide such testimony and shall also identify the topics that such person may testify about as a possible expert. Plaintiff shall provide such disclosures on or before December 11, 2015 and defendant shall provide such disclosures on or before January 29, 2016.
On the date set for Advanced Polymer's expert disclosures, December 11, 2015, Plaintiff provided written expert reports for retained experts and provided written disclosures identifying the subject matter that identified individuals employed by Plaintiff might testify about. Saab's disclosure indicated that he would likely testify about a number of topics, including confidential and trade secret information developed and used by Advanced Polymers with respect to the manufacture of medical balloons and heat shrink tubing and analysis of how Defendants' processes and equipment and raw materials are based on confidential trade secret or proprietary information of Advanced Polymers. A total of 15 topics were identified for Saab.
On the January 8, 2016, Defendants' counsel suggested to Plaintiff's counsel that Saab could not provide testimony that commented on Defendants' processes or information received from Defendants because he had not prepared an expert report. At oral argument, counsel for Defendants asserted that he believed that counsel for Plaintiff had a made tactical decision to evade the plain meaning of the statute. Plaintiff denied this claim and stated that he believed the statute provided specifically that expert reports were not necessary for Advanced Polymer employees who would be testifying as expert witnesses, but that he had proposed the disclosure scheme in an abundance of caution to insure that all parties had appropriate discovery. He pointed out that although the disclosure was provided on December 11, 2015, counsel for the Defendants never raised the claim that an expert report should be provided for almost a month, which, at the very least, suggests that defense counsel did not believe there was anything improper about the way in which Advanced Polymers was proceeding.
The Court finds no improper conduct on the part of Plaintiff's counsel. However, the terms of the agreement entered into by the parties required a disclosure with respect to witness who "was not required to provide a report pursuant to RSA 516:29-b." The Court must therefore analyze whether a witness is required to provide a report under the stipulation and the statute.
II
When the legislature enacted RSA 516:29-b, the Judiciary Committee noted that the enactment of the statute would "not be a significant change in current practice." N.H. Judiciary Committee Hearing Report, S. 04-0362 (Feb. 9, 2004) (statement of Attorney Honigberg). Moreover, the statutory language "data or other information" was taken directly from the 1993 version of Fed. R. Civ. P. 26(a)(2)(B). See id. ("[T]he language is straight from Federal Rule 26.") (statement of Attorney Honigberg). Precedent, practice, and the Legislature's reliance on the language of Fed. R. Civ. P. 26(a)(2)(B) in enacting RSA 516:29-b in 2004, indicates that statutory interpretations of Fed. R. Civ. P. 26(a)(2)(B) are helpful. Thus, application of the majority interpretation of Fed. R. Civ. P. 26(a)(2)(B) will ensure that the construction of RSA 516:29-b is consistent with the Legislature's intent.
Although not germane to this dispute, the statute was amended in 2013 to track recent changes in Fed. R. Civ. P. 26(a)(2)(B).
The general rule in the federal courts is that an expert witness who is not retained and who does not generally testify as an expert witness is not required to prepare an expert report. Wright & Miller, 8A Federal Practice and Procedure § 2301.1 (3rd Ed. 2015). The courts have drawn a distinction between treating physicians and physicians retained for the purpose of giving expert opinion testimony; while the former need not provide expert reports, the latter must. See, e.g., Downey v. Bob's Disc. Furniture Holdings, Inc., 633 F.3d 1, 9 (1st Cir. 2011) ("[W]here, as here, the expert is part of the ongoing sequence of events and arrives at his causation opinion during treatment, his opinion testimony is not that of a retained or specially employed expert."); Sprague v. Liberty Mut. Ins. Co., 177 F.R.D. 78, 81 (D.N.H. 1998). The New Hampshire Supreme Court has never addressed this issue, but Superior Court judges have specifically taken this view of RSA 516:29-b, II. Razzaboni v. Halle, Hillsborough County Superior Ct., Northern District, No. 05-C-0475 (May 16, 2006) (Order, Lewis, J.); Blouin v. Sanborn, Hillsborough County Superior Ct., Northern District, Nos. 05-C-0254 and 05-E-0152 (Feb. 9, 2006) (Order, Mangones, J.).
While the distinction is usually applied to treating and non-treating physicians, the same analysis is applicable in cases involving other areas of expertise. See, e.g., Guar. Tr. Life Ins. Co. v. Am. Med. and Life Ins. Co., 291 F.R.D. 234, 238 (N.D.Ill. 2013) (holding that a former employee who was a certified public accountant could testify to expert opinions despite not having provided an expert report because he was proffered for his knowledge of the transactions at issue and not for the purpose of reviewing the materials expressly for litigation). Federal courts have applied a bright line test that:
Non-retained experts must only testify about opinions formed during the course of their participation in the relevant events of the case, and only those opinions which were properly disclosed. As a result, [the expert] may only testify to opinions formed during, and as part of, his employment with [the defendant], and not those they developed later or in anticipation of litigation.Id. at 237.
The Court believes this principle is applicable to the facts of this case. Saab's disclosure relates almost exclusively to Advanced Polymers' confidential and/or trade secret information. It recites that he will testify about Advanced Polymers' products (¶¶ 1-2), Advanced Polymers' processes for manufacturing products (¶¶ 3, 4, 5, 7, 9, 10, 12 & 15), and Advanced Polymers' marketing information (¶¶ 10-11). The disclosure also recites that he will testify as to an explanation of files reviewed by Pappas prior to his departure from Advanced Polymers and the possible use of those funds. All of these areas involve Saab's activities at Advanced Polymers. Similarly, paragraph 13 of the disclosure states that Saab will testify as to career opportunities in the medical device and plastics industries. If this testimony is based on his experience at Advanced Polymers, no report is necessary.
Paragraph 8 of the disclosure, however, indicates that Saab will testify to a "analysis of Defendants' processes and equipment and raw materials and how the same are based on confidential/trade secret information proprietary to" Advanced Polymers. Such information could not have been part of Saab's work at Advanced Polymers, because he was not aware of Defendants' processes and equipment and raw materials until this litigation began. Paragraph 14 recites that Saab will testify about steps required for developing and manufacturing [REDACTED] and also states that "this may also include testimony concerning the topics concerning defendants although at this point very limited information has been provided and even more limited information has been made available to Mr. Saab based on the designations under the protective order in this matter." By its very terms, the disclosure recognizes that the information to be testified to does not involve information obtained during the course of Saab's employment at Advanced Polymers. Accordingly, Advanced Polymers shall provide an expert disclosure with respect to the subject areas described in paragraphs 8 and 14 of the disclosure, to the extent the testimony involves activity engaged in by Defendants.
Advanced Polymers has also provided summaries, pursuant to the parties' agreement, for four other expert employee witnesses, Robertson, Fisher, Testa and Gilarde. The disclosures for those individuals relate almost exclusively to Advanced Polymers or the industry. Assuming they testify to information learned about during their employment, no expert report need be provided. Testa's disclosure states in relevant part that he may provide testimony concerning costs involved in development and marketing and selling as well as margins and profits for Advanced Polymers. He may do so without providing an expert report. However, his disclosure states that he "may also provide testimony as to these topics as they relate to defendant's costs and profits." He may not do so unless he provides an expert report on these subjects. Similarly, Gilarde's disclosure states that he may provide testimony relating to Advanced Polymers' product line, its uniqueness in the medical device field, and costs involved in developing, manufacturing, marketing, and selling heat shrink tubing and medical balloons. He may do so without providing an expert report. The disclosure states that he "may also provide testimony of these topics as they relate to defendants' costs and profits." If he intends to do so, an expert report on these subjects must be provided.
III
Advanced Polymers has moved to require Defendants to answer Plaintiff's Interrogatories 1 through 7 and Document Requests 1 through 4. Advanced Polymers requested a status conference and filed a letter brief on this issue on December 2, 2015. The Court held a status conference, but the parties could not narrow the dispute. The Court ordered that the December 2 letter would be treated as an opening brief, an objection would be filed on or before January 11, 2016, and a reply would be filed on January 21, 2016. The Court ordered that the dispute would be resolved on the papers.
The dispute between the parties is straightforward. Plaintiff alleges that the Defendants have expropriated their trade secrets. Defendants assert both in their affirmative defenses and their counterclaims that Plaintiff's trade secrets are in the public domain. (See Defs.' Am. Answer to Am. Compl. with Affirmative Defenses and Counterclaims ¶ 174 ("[I]nformation Vention seeks to protect . . . is easily obtainable and readily ascertainable through . . . review of patents or other public domain information or otherwise.").) Defendants allege in their first counterclaim that Plaintiff has engaged in unfair and deceptive trade practices by "falsely claiming . . . that it had developed unique technologies involving the [REDACTED] when in fact these technologies been have well known for decades." Accordingly, in a series of interrogatories and production requests, Advanced Polymers essentially asked Defendants to specify the documents it will rely on for the proposition that information Advanced Polymers seeks to protect is easily obtainable and readily ascertainable by reviewing patents and other public domain information. For example, Interrogatory number 2 of Plaintiff's Fifth Set of Interrogatories states:
2. State with specificity any facts and/or sources of information and identify all documents that demonstrate that Vention's processes (step-by-step) for production of [REDACTED], including all equipment used in processing conditions, is disclosed in the public domain.
Defendants objected that the interrogatories required it to provide all facts which demonstrate that each step of the process used to manufacture heat shrink tubing is in the public domain. (Defs.' Obj. ¶ 5.) Defendants answered, by stating that "it is not possible to identify all 'facts' and 'sources' and all 'documents' which demonstrate that each step of the processes used to manufacture heat shrink tubing or tubing samples is in the public domain." Subject to its objection, Defendant's interrogatory answer went on to state:
Mr. Pappas will nevertheless attempt to identify the most significant steps or elements involved in the processing of nylon tubing so it can be used for certain medical applications; some of the categories of information which are publicly available about such debts and elements; and some examples of such information . . . .Defendants then provided a list of sources it describes as "examples."
In its letter brief, Advanced Polymers pointed out that it did not request information about all facts that demonstrate that the processes it claims are a trade secret are in the public domain, but rather "the identity of the sources that demonstrated that the process used by defendants was disclosed in the public domain." (Advanced Polymer's Letter Brief, Dec. 2, 2016, at 3.) Much of Defendants' Objection asserts positions that are irrelevant to this dispute. Whether through misapprehension or otherwise, they take the position that the interrogatory requests are overbroad because the Plaintiff is requesting Pappas "to compile information and documents about what is or is not in the public domain, whether or not he is currently aware of it, and whether or not he used such information in his own independent development efforts." (Defs.' Obj. ¶ 22.) This is plainly not what was requested.
For example, two headings of the Objection state "Plaintiff Has Not Properly Identified the Trade Secrets At Issue in This Case," and "Plaintiff Concedes That It Cannot Make the Same Products as Mr. Pappas." (Defs.' Obj. ¶¶ 16-23, 24-25.)
Defendants do raise one substantive issue: that requiring any further disclosure would constitute an invasion of work product. (Defs.' Obj. ¶ 27.) Defendants take the position that they are not required to disclose information regarding what is in the public domain that they intend to rely upon at trial, based on the work product privilege. Defendants Objection quotes an e-mail sent by defense counsel to plaintiff's counsel in which he articulates this view:
To repeat . . . I thought our responses were very clear. Based on memory, I'm pretty certain we said that, even if plaintiff had not exceeded the 25 interrogatory limit:(Defs.' Obj. ¶ 3 (emphasis added).)
Plaintiff has the burden of proof on all elements of our trade secret claim. We do not have the burden of proof regarding what is or is not in the public domain, and we have not yet determined what evidence we may or may not offer at trial with respect to this issue. We cannot be compelled to create this work product for plaintiff's benefit.
Defendant's position is illustrated by the excerpts of the deposition of Pappas included in Plaintiff's Reply. In response to questioning about what patents he relied upon to establish that certain technology was in the public domain, defense counsel refused to allow him to answer. (Pappas Dep. 921:10-922:4.) At several points, Pappas refused to answer questions about what information he relied upon to establish that certain technology was by asserting the work product privilege. (Pappas Dep. 929:3-931:13.)
Defendants' view of the breadth of the work product doctrine is simply incorrect. In the first place, under the Superior Court rules:
[A] party must, without awaiting a discovery request, provide to other parties . . . a copy of all documents, electronically stored information, and tangible things that the disclosing party has in his or her possession, custody or control and a used to support his or her claims or defenses unless the use would be solely for impeachment.Super. Ct. R. 22(a)(2). While recognizing their obligations under the rule, Defendants take the position that requiring them to identify what documents they rely upon in order to make a claim and counterclaim that Advanced Polymers' alleged trade secret is in fact in the public domain would violate the work product doctrine.
The work product doctrine developed at common law and exists to protect litigants from being forced to reveal their litigation strategy. Riddle Spring Realty v. State, 107 N.H. 271, 224 (1966). Consistent with the federal doctrine, the New Hampshire Superior Court Rules provide that a party may obtain discovery of documents prepared in anticipation of litigation, and otherwise discoverable, only under certain circumstances, and in ordering discovery of such materials, a court "shall protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of an attorney or other representative of a party concerning the litigation". Super. Ct. R. 21(e)(1). But the work product doctrine does not allow a party to shield facts from discovery:
A party may not use the fact that relevant information sought is work product to block discovery. Courts will generally order production of the information sought, in any form in which the producing party can gather it, reserving the right to claim work product protection for a particular document. They will not countenance refusal to provide factual information on the grounds that it purportedly exists only in work product form. Interrogatories can always be imposed and must be answered even if the particular work product document need not be produced.E.S. Epstein, The Attorney-Client Privilege and the Work Product Doctrine 803 (5th ed. 2007)
It is not clear in the instant case that any of the interrogatories, requests for production, or deposition questions would, in fact, even require the production of a document. Rather, the requests appear to be directed to Defendants with the intention that the Defendants designate the facts upon which they will rely at trial. This is entirely proper:
The courts have consistently held that the work product concept furnishes no shield against discovery, by interrogatories or by deposition, of the facts that the adverse party's lawyer has learned, or the person from whom he has learned such facts, or the existence or nonexistence of documents, even though the documents themselves may not be subject to discovery.State Farm Mut. Auto. Ins. Co. v. New Horizon, Inc., 250 F.R.D. 203, 214 (E.D. Pa. 2008) (quoting Wright & Miller, 8A Federal Practice and Procedure § 2023). "There is simply nothing wrong with asking for facts from a deponent even though those facts may have been communicated to the deponent by the deponent's counsel." Id. at 214 (quoting In re Linerboard Antitrust Litig., 237 F.R.D. 373, 384 (E.D. Pa. 2006)); see also GT Crystal Sys., LLC v. Khattak, Merrimack County Superior Ct., No. 2011-CV-332 (Jan. 6, 2014) (Order, McNamara, J.).
While the work product doctrine protects against the disclosure of protected documents or communications, it does not protect the underlying facts from disclosure. Koch Materials Co. v. Shore Slurry Seal Inc., 208 F.R.D. 109, 122 (D.N.J. 2002) (citing Upjohn Co. v. United States, 449 U.S. 383, 395-96 (1981)). Courts generally reject the proposition that "discovery requests which seek to require a party to identify the evidence that it will rely to establish his legal positions are barred by the attorney work product privilege". Pentair Water Treatment Co. v. Cont'l Ins. Co., 2009 U.S. District LEXIS 106424 (S.D.N.Y. Nov. 16, 2009) *4.
Illustrative is United States ex rel. Englund v. Los Angeles County, 235 F.R.D. 675 (E.D.Cal. 2006), a qui tam action in which the defendant raised the defense of public disclosure. The plaintiff in that case sent an interrogatory requesting "each public disclosure of allegations or transactions in a criminal, civil or administrative hearing . . . that you claim this lawsuit is based upon"and an interrogatory requesting the defendant to "[s]tate all facts that support in any way to your claim that this lawsuit is based upon public disclosure of allegations or transactions in a criminal, civil or administrative hearing." Id. The defendant responded by objecting and referring the plaintiff to 3000 pages of documents. Id. The plaintiff moved to compel, and the court granted the motion, noting that under the Federal Rules of Civil Procedure the "plaintiff is entitled to receive the facts supporting defendant's defense in this action. Citing to 3000 pages of documents is insufficient." Id. at 682.
The New Hampshire rule is, of course, broader than the federal rules. In New Hampshire a party is entitled to discovery of anything which might reasonably lead to admissible evidence.
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Defendants make one last argument in support of its claim that it should not be required to produce the documents upon which it intends to rely. It points to the provision in Super. Ct. R. 22 that documents for use in impeachment need not be produced. (Defs.' Obj. ¶ 27.) The short answer to this argument is that as a counterclaim plaintiff, Pappas is required and obligated to make the same production as any plaintiff. Moreover, it is generally accepted that impeachment evidence admissible for substantive purposes is subject to the automatic disclosure provisions of Fed. R. Civ. P. 26 (a) which is similar to the New Hampshire Superior Court Rule 22 and requires automatic disclosure. Newsome v. Penske Truck Leasing Corp., 437 F. Supp.2d 431, 436 (D. Md. 2006).
It follows that the Plaintiff is entitled to know what public domain documents upon which Defendants intend to rely to prove their counterclaim that Plaintiff's trade secret is in the public domain. The Interrogatories and Requests for Production filed by Plaintiff, which are the subject of the letter brief, must be answered by the Defendants. 1/28/16
DATE
s/Richard B. McNamara
Richard B. McNamara,
Presiding Justice
RBM/