Case Summaries on

Business Secrets
Table of Cases

Case Name Citation

E.I. Dupont De Nemours & Company v.
Kolon Industries Incorporated
Motorola Solutions, Inc, et. al. v. Hytera
Communications Corp. Ltd.
Waymo LLC v. Uber Technologies
Merck Sharp & Dohme Corp. v. Pfizer Inc. et
al.
Wyeth v. Natural Biologics Inc.
564 F. App'x 710 (4th Cir. 2014)
495 F. Supp. 3d 687 (N.D. I11. 2020)
No. C 17-00939 WHA (N.D. Cal. Jan. 29,
2018)
Civil Action No. 19-2011 (E.D. Pa. Jun. 28,
2021)
395 F. 3d 897 - Court of Appeals, 8th Circuit
2005

Intellectual Property Department

Angara Abello Concepcion Regala & Cruz Law Offices
 E.I. DUPONT DE NEMOURS & COMPANY V. KOLON INDUSTRIES
INCORPORATED
F. App'x 710 (4th Cir. 2014)

Case Summary: DuPont, the manufacturer of a para-aramid fiber called Kevlar, filed a complaint
against Kolon, a South Korean corporation, for trade secret misappropriation and theft of
confidential business information when Kolon took in former DuPont employees as consultants
for its development of a para-aramid fiber that would compete with their product. Kolon argued
that a number of the alleged trade secrets put in issue by DuPont are publicly available information,
pointing to evidence presented by DuPont in a 1980s intellectual property litigation it had against
its then-competitor AkzoNobel. The district court rejected this argument and excluded the
evidence that Kolon aimed to present regarding the Akzo litigation. The jury eventually ruled
against Kolon, finding that Kolon had committed trade secret misappropriation and ordered them
to pay around $920 million in damages. The appellate court, however, vacated the judgment and
ordered the remanding of the case. The appellate court held that the district court abused its
discretion in excluding evidence of the Akzo litigation, and that said evidence is not irrelevant or
insufficiently probative in the case at bar. Kolon should at the very least be given the opportunity
to present its evidence and prove its claims.

Facts:
DuPont is a well-known chemical company that has, for more than 30 years, produced Kevlar, a
high-strength para-aramid fiber that is used in ballistics, bullet-resistant armor, and automotive
and industrial products. Kevlar is made through a highly complex chemical process that results in
a dough-like polymer being spun at high speed until it becomes a fiber. DuPont claims that
Kevlar’s production process is a “well-guarded secret”, in that all DuPont employees working on
Kevlar are required to sign a confidentiality agreement.

Kolon is a South Korean corporation that has produced synthetic fibers, including nylon and
polyester, for decades. Kolon engaged in pilot projects for the development of para-aramid pulp
and fiber products in the 1980s and 1990s.

In 2005, Kolon announced that it would enter the para-aramid fiber market with its product,
Heracron, to compete directly with Kevlar. In 2006, Kolon sought out five former DuPont
employees to work as consultants to improve its para-aramid manufacturing technology and to
assist in resolving quality issues with Heracron.

Among the former DuPont employees consulted by Kolon was Michael Mitchell, who had worked
in sales and technical positions from 1982 until 2006. After the termination of his employment,
Mitchell had extensive knowledge of both the technical and business trade secrets relating to
Kevlar and, in violation of DuPont internal policies and agreements between him and the company,
had kept numerous documents and files containing DuPont proprietary information related to
Kevlar and had admitted to sharing the same with Kolon. DuPont learned of Mitchell's consulting
arrangement shortly after he executed it, and, in 2007, DuPont began to investigate Mitchell's
actions. Shortly thereafter, DuPont reached out to the FBI and the Department of Commerce, and
E.I. Dupont De Nemours & Company v. Kolon Industries Incorporated
564 F. App'x 710 (4th Cir. 2014)

Mitchell was eventually indicted by a jury for theft of trade secrets, conspiracy, and obstruction of
justice.

On February 3, 2009, DuPont filed a Complaint against Kolon under the Virginia Uniform Trade
Secrets Act (VUTSA), claiming that Kolon and its United States subsidiary "engaged in concerted
and persistent actions to wrongfully obtain DuPont's trade secrets and confidential information
about DuPont's Kevlar aramid fiber." DuPont alleged that Kolon committed trade secret
misappropriation, theft of confidential business information, conspiracy, and other business torts
related to Kevlar.

Kolon raised, among other defenses, that a number of the alleged trade secrets put at issue by
DuPont involved publicly available information. Specifically, Kolon theorized that DuPont itself
had disclosed or otherwise failed to keep confidential such information in the course of intellectual
property litigation in which it was engaged during the 1980s with its then primary competitor,
AkzoNobel (the Akzo litigation). DuPont argued that such evidence was not relevant and that
permitting the jury to consider any such evidence would cause confusion and delay, to DuPont’s
prejudice. The district court agreed with DuPont and granted the motion in a summary order,
concluding that “Kolon had produced no evidence that any particular trade secret, much less a
trade secret that is at issue in this litigation, was disclosed in the litigation between DuPont and
Akzo”.

After a 7-week trial, on September 14, 2011 the jury returned a verdict finding that Kolon willfully
and maliciously misappropriated 149 DuPont trade secrets and awarded DuPont $919.9 million in
damages. The jury found that Kolon willfully and knowingly acquired from one or more of the 5
consultants a myriad of DuPont trade secrets concerning Kevlar, involving both technical and
business/marketing confidential information. Following the verdict, the district court enjoined
Kolon from para-aramid fiber production for 20 years. The district court denied Kolon’s motion
for a new trial and its renewed motion for judgment as a matter of law on January 27, 2012.

On appeal, Kolon argued that the district court abused its discretion in excluding all evidence and
any mention of the Akzo litigation. Kolon maintains that the excluded evidence would have tended
to demonstrate that “at least 42 of the trade secrets DuPont has asserted involve information that
was wholly or partially disclosed during the prior litigation.” Kolon further asserts that the district
court’s exclusion of that evidence severely limited its ability to put on a meaningful defense
because it prohibited Kolon from establishing that one or more of the 42 alleged trade secrets
cannot meet the elements of a protectable trade secret. DuPont argues that the district court did not
abuse its discretion in excluding all Akzo litigation evidence because Kolon failed to demonstrate
that any of the trade secrets at issue in this case were disclosed in the Akzo litigation.

Issue/s: Whether or not the district court abused its discretion in excluding evidence of the Akzo
litigation.

Resolution: Yes, the district court abused its discretion in excluding evidence of the Akzo
litigation.

2
E.I. Dupont De Nemours & Company v. Kolon Industries Incorporated
564 F. App'x 710 (4th Cir. 2014)

Under Virginia law, a “trade secret” is defined as: information, including but not limited to, a
formula, pattern, compilation, program, device, method, technique, or process, that:
1. Derives independent economic value, actual or potential, from not being generally known to,
and not being readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use, and
2. Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

Under the Federal Rules of Evidence, evidence is relevant if it has a tendency to make a fact of
consequence to the action more or less probable than it would be without the evidence.

The appellate court found that under this inclusive standard, Kolon provided the district court with
a sufficient number of examples of how information disclosed in the Akzo litigation contained
details of the Kevlar production process that were strikingly similar to aspects of several of the
alleged trade secrets in this case. The court specifically mentioned two charts illustrating a certain
aspect of the para-aramid production process which were used as an exhibit in the Akzo litigation
and in this case, as well as a chart comparing seven alleged trade secrets concerning the production
process contained in an expert witness report in this case with descriptions of, and citations to,
those same details of the production process that were disclosed in a trial exhibit in the Akzo
litigation. The court also noted that one of Kolon’s consultants had served as an expert witness for
DuPont in the Akzo litigation.

The appellate court held that Kolon was not required to establish that evidence derived from the
Akzo litigation amounted to an actual trade secret at issue in this case. Rather, to show the
relevance of the evidence, Kolon simply needed to make a plausible showing that, either directly
or circumstantially, one or more elements of DuPont’s misappropriation claims, e.g., the
reasonableness of its efforts to maintain confidentiality, was less likely true. Equivalently, Kolon
simply needed to make a plausible showing that, either directly or circumstantially, one or more
elements of its defenses, in this case the reasonableness of its asserted belief that its consultants
were not disclosing trade secrets, was more likely true than not true. Thus, the appellate court held
that the evidence from the Akzo litigation which Kolon seeks to present is not irrelevant or
insufficiently probative in the case at bar.

Under the Federal Rule of Evidence 403, exclusion is only proper when the probative value of the
evidence is substantially outweighed by the danger of confusion of the issues or misleading the
jury. That standard is not satisfied in this case, for the potential for confusion and delay does not
outweigh the probative value of the excluded evidence.

In any case, the appellate court clarified that the evidence derived from the Akzo litigation that
Kolon seeks to present need not necessarily be admitted on the retrial. What is important in this
case is merely that Kolon be given the opportunity to present such to the jury in order to prove its
contention that the alleged confidential information are already generally known to the public.
Thus, the court deemed it proper to vacate the district court’s judgment and remand the case to a
different judge for further proceedings.

3
 MOTOROLA SOLUTIONS, INC, ET. AL. V. HYTERA COMMUNICATIONS CORP.
LTD.
495 F. Supp. 3d 687 (N.D. I11. 2020)

Case Summary: Hytera recruited three Motorola engineers who stole confidential and technical
information from Motorola. Part of the information stolen are available within the public domain.
They used the stolen information to develop their own Digital Mobile Radio (DMR) which
competed with the DMR developed by Motorola. Motorola sued Hyteria for theft of trade secret.
Hyteria argued that in order to prove that information is a trade secret, each of the elements
comprising the whole of the information must be proven to be a secret.

The court ruled that the test to determine whether the information is a trade secret is not whether
there "are a host of materials which would fall within the public domain," but rather, when the
documents are "collected and set out as a unified process, that compilation, if it meets the other
qualifications, may be considered a trade secret.

In other words, the test to determine a trade secret is not whether each of the elements comprising
the whole of the information is indeed a secret, but whether the totality of the information as
compiled (or organized) affords a competitive advantage to its possessor (which is considered a
secret – not disclosed to the public nor to its competitors).

Facts:
For decades, dating back to the late 1980's and into the 2000's, Motorola developed technology to
create certain specific digital radios. In 2006, Hytera was having difficulty in creating comparable
radios. In June 2007, the president of Hytera Chen Qingzhou reached out to Motorola engineer
G.S. Kok. Chen told Kok that he was looking to set up a potential research and development center
for Hytera in Malaysia. Shortly thereafter, Chen and Kok negotiated Kok's departure from
Motorola for Hytera.

G.S. Kok joined Hytera. Shortly thereafter, G.S. Kok was surprised that even after Hytera had been
working on the relevant digital radio project for three years, Hytera did "not even have a
prototype." Kok then stated that Hytera needed an "injection of subject matter experts" in order to
leapfrog Motorola in that market.

Subsequently, Hytera hired two additional Motorola Malaysia engineers —Y.T. Kok and Sam
Chia. Y.T. Kok and Sam Chia, downloaded more than 10,000 technical documents from
Motorola's secure database and brought them to Hytera. When Y.T. Kok was hired by Hytera, he
initially maintained his employment with Motorola while surreptitiously also working for Hytera.

In June 2008, shortly after the addition of Y.T. Kok and Sam Chia, several emails circulated within
Hytera which the entire digital mobile radio ("DMR radio") group was copied on, including one
with a list of questions about issues that needed to be resolved in order for Hytera to create a DMR
radio. Chia forwarded one of those emails to Y.T. Kok and stated that he should focus on some of
the specific questions. The same day, Y.T. Kok downloaded 50 technical documents from
Motorola's database; the next day, he downloaded an additional 83; the third day, he downloaded
Motorola Solutions, Inc, et. al. v. Hytera Communications Corp. Ltd.
495 F. Supp. 3d 687 (N.D. I11. 2020)

40 more. Again, in all, more than 10,000 technical documents were downloaded and brought to
Hytera from Motorola. Broadly, among the files taken were Motorola's source code for the DMR
radio project.

Segments of Motorola's source code were later directly inserted into Hytera's product. In some
cases, misspelled words (which had no impact on the functionality of the code) appeared in both
the Motorola code and the Hytera code. Hytera re-wrote Motorola's code to conceal that it had
been used. The code and Motorola technical documents were circulated among Hytera engineers,
at times with the Motorola logo removed and replaced with a Hytera logo, and at times still labeled
with Motorola's logo.

Eventually, Hytera developed a radio that was functionally indistinguishable from the DMR radio
developed by Motorola. Hytera sold that radio for years and, according to Motorola, continues to
be selling the misappropriated trade secrets and infringing products to this day.

Hytera raised the following defenses:

1. Motorola has failed to satisfy the elements of a trade secret claim –
a. Hytera argues that Motorola has not proven the existence of protectable trade
secrets because Motorola has not identified the trade secrets with sufficient
specificity and because Motorola has failed to show that the materials were
"sufficiently secret."

b. Hytera argues that Motorola failed to use reasonable security measures to protect
its secrets as Motorola allowed the stolen documents to be available to "everyone."

2. Motorola has failed to state a copyright claim

a. Hytera argues that Motorola has failed to prove substantial similarities between the
accused work and the copyrighted work. Specifically, Hytera argues that Motorola
did not make any attempt to distinguish between protected and unprotected similar
elements.

Issue/s:
1. Whether or not Motorola has failed to satisfy the elements of a trade secret claim

2. Whether or not Motorola has successfully stated a copyright claim

Resolution:

1. Whether or not Motorola has failed to satisfy the elements of a trade secret claim

Motorola has satisfied the elements of a trade secrets claim. Motorola proceeded on a theory of a
theft of 21 distinct trade secrets at trial. For each alleged trade secret, Motorola tied certain
documents to that specific trade secret and explained those documents through five fact witnesses
and numerous experts across more than 25 hours of testimony. Motorola's witnesses explained that
these documents constituted the "playbook" by which the engineers built its two- way radio
devices.

2
Motorola Solutions, Inc, et. al. v. Hytera Communications Corp. Ltd.
495 F. Supp. 3d 687 (N.D. I11. 2020)

The fact witnesses and experts went into detail when explaining what was contained in each
document and how the processes contained therein combined into a coherent whole to create the
digital radio functionalities at issue in the trial.

In order to be considered a trade secret, a pattern, technique, or process need not reach the level of
invention necessary to warrant patent protection. A trade secret can exist in a combination of
characteristics and components, each of which, by itself, is in the public domain, but the unified
process, design and operation of which, in unique combination, affords a competitive advantage
and is a protectable secret. 1

The documents at issue in this case no doubt contained some public information, but the issue is
not whether there "are a host of materials which would fall within the public domain," but rather,
when the documents are "collected and set out as a unified process, that compilation, if it meets
the other qualifications, may be considered a trade secret.

It was proven that the stolen confidential materials were the compilation of decades of engineering
work that laid out the specific specifications as to how Motorola implemented types of functions
within its radios.

As to Hyteria’s argument that Motorola failed to use reasonable security measures to protect its
secrets, it was proven that Motorola took sufficient steps to safeguard its technical documents.
Motorola employees were subject to a confidentiality agreement. The database that contained the
technical documents and source code was accessible only to certain Motorola employees. That
certain internal documents did not contain the specific words "trade secret" on them is insufficient
to prove otherwise.

2. Whether or not Motorola has successfully stated a copyright claim

As to the argument that Motorola did not make any attempt to distinguish between protected and
unprotected similar elements, the court ruled in favor of Motorola. Motorola identified the code
that Hytera copied from each version of Motorola's DMR and mapped the copying to the asserted
work.

Hytera solely points to its expert's testimony related to several lines of code that are allegedly
similar to a third party code. This ignores other code that was shown to the jury—including,
notably, code which contained identical misspellings at points.

1
Citing 3M v. Pribyl, 259 F.3d 587, 595-96 (7th Cir. 2001).

3
 WAYMO LLC v. UBER TECHNOLOGIES
No. C 17-00939 WHA (N.D. Cal. Jan. 29, 2018)

Case Summary: Levandowski, who was previously an engineer in charge of Waymo’s self-
driving car project, built his own company Ottomotto. He appropriated Waymo’s “LiDAR
technology” and even hired Waymo’s previous employees who also secured Waymo’s other
sensitive or confidential information. Ottomotto was later acquired by Uber. But prior
appropriation, Uber and Ottomotto’s counsel hired Stroz to investigate about Levandowski and the
other previous employees of Waymo. The finding was called the “Stroz Report”. Waymo filed a
lawsuit for patent infringement and violation of trade secret laws against Levandowski and Uber
and were asked to produce the “Stroz Report”. Levandowski claims that the “Stroz Report” cannot
be used against him since it is covered by the attorney work-product protection. The Court held
that “The work-product doctrine protects from discovery documents, tangible things, or
compilations of materials that were prepared in anticipation of litigation by a party or its
representative”. In this case, it is Uber and Ottomotto’s counsel (not Levandowski’s own counsel)
who hired Stroz as its representative. Thus, only Uber can assert attorney work-product protection
over “Stroz Report” and not Levandowski.

Facts:
In January 2016, Anthony Levandowski, an engineer in charge of Waymo’s self-driving car
project, resigned from Waymo and formed his own autonomous vehicle start-up called Ottomotto.

In May 2016, Uber acquired Levandowski’s start-up for $680 and as part of the deal, he took over
as chief of Uber’s autonomous vehicle program. But prior the closing of acquisition, Uber and
Ottoman’s counsel (not Levandowski’s own counsel) retained Stroz Friedberg to investigate
Ottomotto employees who were previously employed by Waymo, including Levandowski. The
resulting report was called the “Stroz Report”.

Waymo became aware that Levandowski may have taken its proprietary “LiDAR” technology.
This LiDar (known as “light detection and raging” technology) allows self-driving vehicles to
detect pedestrians, traffic, and the other obstacles that autonomous vehicles must see to drive
safely. Waymo found that the Uber circuit board closely resembled Waymo’s circuit board. It
further discovered evidence that Levandowski downloaded thousands of documents from
Waymo’s database few months before he left Waymo. Other employees who followed
Levandowski in his own company, Ottomotto, also downloaded several sensitive information from
Waymo’s systems such as manufacturing details and other confidential information.

Waymo filed a lawsuit in Federal Court in California with claims of patent infringement and
violations of federal and state trade secret laws. In addition, it filed a motion to compel Uber to
produce the “Stroz Report”.

In its defense, Uber alleged that LiDar was not really a trade secret since this technology was
generally known or perceptible by its on engineers. It also moved to quash the subpoena by arguing
that the “Stroz Report” is subject to attorney-client privilege or attorney work-product protection.
Waymo LLC v. Uber Technologies
No. C 17-00939 WHA (N.D. Cal. Jan. 29, 2018)

Issue/s:
1. Whether or not the Uber can assert attorney work-product protection over the Stroz
Report
2. Whether or not the Common Interest Doctrine applies to Levandowki

Resolution:

1. Whether or not the Uber can assert attorney work-product protection over the Stroz
Report

Yes, Uber can assert attorney work-product protection over Stroz Report but not Levandowski

The work-product doctrine protects from discovery documents, tangible things, or compilations of
materials that were prepared in anticipation of litigation by a party or its representative.

In this case, it is Uber and Ottoman’s counsel who hired Stroz as its representative and not
Levandowski. Whether Uber can assert work-product protection over the Stroz Report does not
benefit Levandowski. Work-product protection covers documents prepared by a party or its
representative. Furthermore, Levandowski also concedes that he did not hire Stroz as his
representative

2. Whether or not the Common Interest Doctrine applies to Levandowki

No, the common interest doctrine does not apply.

Common interest doctrine provides an exception to ordinary waiver rules and allow representatives
and third parties to communicate in pursuit of common legal strategy.

Uber and Levandowski had adverse rather than common interests in connection with the “Stroz
Report”. Even if Levandowski was entitled to assert work-product protection, he waived that
protection by disclosing the information for the benefit of adverse party which is Uber.

The common interest doctrine does not apply and, therefore, cannot save Levandowski's waiver of
the work-product protection.

2
 MERCK SHARP & DOHME CORP. V. PFIZER INC. ET AL.,
CIVIL ACTION No. 19-2011 (E.D. Pa. Jun. 28, 2021)

Case Summary: Merck Sharp & Dohme Corp. brings this trade secrets misappropriation action
against Defendants Pfizer, Inc., and Dr. Wendy Watson, alleging Dr. Watson stole confidential
information from Merck and misappropriated Merck trade secrets for use in a directly competing
vaccine program. Progress in this case has been hampered by continuing discovery disputes, and
Merck and Defendants have now filed cross motions to compel discovery. Both Pfizer and Merck
have withheld relevant information. Each also asks the Court to compel production of material that
is beyond the scope of discovery in trade secrets cases. The Court will grant in part and deny in
part both motions.

Facts:
Merck and Pfizer are competitors in the market for pneumococcal vaccines. Dr. Wendy Watson
worked at Merck as a regulatory liaison in Merck's vaccine development programs. Dr. Watson
was responsible for communication with the U.S. Food and Drug Administration for regulatory
approval of Merck's vaccines and thus had access to confidential information on Merck's
pneumococcal conjugate vaccine (PCV) program. In 2011, Dr. Watson left Merck for a similar
position at Pfizer. Merck alleges Dr. Watson stole trade secrets from Merck's PCV program shortly
before the end of her employment ten years ago to use in her new employment at Pfizer. The said
stolen documents allegedly included information on Merck's chemical manufacturing and controls,
regulatory affairs, drug substance and clinical studies, proprietary manufacturing methodologies,
competitive business intelligence, and business and marketing strategies. After the internal
investigation and attempts with Pfizer to remediate the issue, Merck filed suit.

Main Issue/s: The crux of the dispute is the extent to which each corporate defendant must divulge
information about its own PCV vaccine program to discover whether, and to what extent, Watson
stole Merck's trade secrets and how exactly Pfizer benefited as a result. Pfizer claims it is entitled
to detailed information on these trade secrets because such knowledge is necessary to determine
the true scope of Dr. Watson's actions. Merck, on the other hand, argues it should not have to
disclose the details of its trade secrets and instead should be allowed to take broad discovery on
Pfizer's PCV program to understand how, when, and to what extent Pfizer benefitted from Merck's
trade secrets.

Issue 1
As a trade secrets plaintiff, is Merck entitled to seek broad discovery on Pfizer's PCV program?

Issue 2
As a trade secrets defendant, is Pfizer entitled to the following information:
(a) detailed information on these trade secrets because such knowledge is necessary to
determine the true scope of Dr. Watson's actions;
(b) compel Merck to explain why each trade secret is not in the public domain;
(c) compel Merck to disclose who developed each of the 134 trade secrets and when they
were developed;
Merck Sharp & Dohme Corp. v. Pfizer Inc. et al.
CIVIL ACTION No. 19-2011 (E.D. Pa. Jun. 28, 2021)

(d) compel Merck to identify the economic benefit it receives from each of the 134 trade
secrets;
(e) compel Merck to identify where in Pfizer's patents and patent applications Merck's trade
secrets appear.

Resolution: The Court will grant in part and deny in part Merck's motion to compel and grant in
part and deny in part Defendants Pfizer and Dr. Watson's motion to compel.

The scope of discovery is broad, but it is not unlimited. Because of the unique nature of trade
secrets cases, plaintiffs bear a special burden as the only party with unrestricted knowledge of the
exact trade secrets at issue. A trade secrets plaintiff must identify its trade secrets “with a
reasonable degree of precision and specificity that is particular enough as to separate the trade
secret from matters of general knowledge in the trade or of special knowledge of persons skilled
in the trade.” This standard requires trade secrets be identified with sufficient particularity so that
the reader understands how each such claim differs from public domain information-including
public patent filings.

Issue 1
No. With regard to Merck's motion for broad discovery on the entirety of Pfizer's PCV vaccine
program dating back to when Dr. Watson left Merck more than ten years ago, the Court ruled that,
“while this information is relevant insofar as Pfizer's PCV program allegedly capitalized on
Merck's secrets, the request is overly broad and unduly burdensome”. The request is unduly
burdensome in terms of the cost of production to Pfizer but also because of the risk that Pfizer will
be forced to disclose its own proprietary information that has nothing to do with this case.

However, with regard to 134 trade secrets raised by Merck, the Court ruled that Merck must
supplement the description of each trade secrets. The Court resolved the issue by providing “were
Merck to provide the specifics of the 134 trade secrets, Pfizer's discovery obligations would
include all relevant, nonprivileged documents relating to those trade secrets”.

Merck is entitled to discovery that is relevant and proportional to its claims. The core of Merck's
allegations is that Dr. Watson stole documents. The needs of the case are dictated by this theory
and particularly, the 134 secrets at issue. Discovery should be limited to information, documents,
and files that will bear on the veracity of those allegations and as well as any defenses. A mutually
cooperative discovery process may reveal some of Merck's requested information, but the Court
will not compel such an expansive discovery request which will necessarily reveal information far
beyond the 134 secrets.

Issue 2

(a) Yes. Pfizer is entitled to learn about these allegedly misappropriated 134 trade secrets,
provided the requests are relevant, not unduly burdensome, and proportional to the needs
of the case.

2
Merck Sharp & Dohme Corp. v. Pfizer Inc. et al.
CIVIL ACTION No. 19-2011 (E.D. Pa. Jun. 28, 2021)

(b) Yes. By asserting these matters as trade secrets, the burden lies with Merck to explain why
these alleged trade secrets were not publicly available at the time they were allegedly
stolen. Merck's burden to describe the trade secrets with reasonable particularity includes
the duty to explain why each secret is not a matter of public knowledge, and the Court
ordered Merck to supplement its response accordingly.

(c) No. This information exceeds the reasonable particularity standard and Merck is not
required to search for and disclose this information. Identifying a single developer (or even
a team of developers) and a date of development for each trade secret is not only
exceedingly burdensome on Merck, but it also far exceeds what a trade secrets plaintiff is
normally required to disclose as a matter of course.

(d) Yes. The reasonable particularity standard requires this. The description of a trade secret,
including an explanation of why it is not a matter of public knowledge, goes hand-in-hand
with the economic value realized by its owner. The economic value gained from one trade
secret may overlap with the value gained from another trade secret, but a trade secrets
plaintiff should be required to explain for each trade secret the economic value gained.

(e) No. This exceeds the bounds of what the Court will compel. The parties do not cite any
binding authority to support the proposition that Merck, after sufficiently identifying the
secrets at issue, must also identify where on Pfizer's patents Merck's trade secrets appear.
Pfizer should be able to make this determination when equipped with reasonably particular
definitions of the trade secrets.

3
 WYETH v. NATURAL BIOLOGICS INC
395 F. 3d 897 - Court of Appeals, 8th Circuit 2005

Case Summary: Wyeth alleged that Natural Biologics illegally acquired Wyeth's trade secret
process for producing bulk natural conjugated estrogens used in the development of Premarin, the
only hormone replacement therapy drug on the market derived from a natural source. The Court
of Appeals upheld the district court’s finding that Natural Biologics misappropriated Wyeth's trade
secret process, and permanently enjoined Natural Biologics from using or disclosing any
information it obtained related to Wyeth's process.

Facts:
Wyeth developed a process called the “Brandon Process” (named after their Brandon, Manitoba
facility) in manufacturing natural conjugated estrogens used in Premarin, which is prescribed for
the treatment of symptoms associated with menopause.

Premarin has been on the market since 1942 without any natural generic substitute. However, in
2002, Natural Biologics entered into an agreement with another company to sell conjugated
estrogens. Natural Biologics used an extraction process that yielded material which was the same
as Premarin. Natural Biologics claims to have independently developed its process through review
of Wyeth's expired patents, scientific literature, and Wyeth's Brandon Facility waste manifests,
which reveal the names and volumes of chemicals used at the Brandon Facility.

Issue/s:

1. Whether the Brandon Process is a trade secret

2. Whether Natural Biologics misappropriated Wyeth's trade secret process
3. Whether Wyeth's misappropriation claim is barred by MUTSA's statute of limitations
4. Whether injunctive relief to prevent the Natural Biologics from selling or manufacturing
the product embodying the secret should be granted

Resolution:

1. Whether the Brandon Process is a trade secret

Yes, the Brandon Process is a trade secret.

Under MUTSA, a trade secret is information that:

1. is not generally known or readily ascertainable,
2. has value as a result of its secrecy, and
3. is the subject of reasonable efforts under the circumstances to protect its secrecy

Natural Biologics apparently concedes the first two requisites but contends that the third requisite
is absent because Wyeth failed to adequately secure its trade secret in many ways, e.g.:
Wyeth v. Natural Biologics Inc
395 F. 3d 897 - Court of Appeals, 8th Circuit 2005

1. non-Wyeth employees toured the Brandon Facility without having signed confidentiality
agreements; there were no posted signs inside the facility indicating that the Brandon
Process information was confidential;
2. unmarked Brandon Process documents were left on the manufacturing floor and unsecured
in Wyeth's Brandon Facility;
3. not all Wyeth employees or vendors involved in the Brandon Process signed confidentiality
agreements;
4. Wyeth identified chemicals used in the extraction process in two newsletters;
5. unmarked documents were sent to third parties; and
6. Wyeth allegedly failed to follow its own security policies.

The Court of Appeals upheld the District Court’s holding that the Brandon Process is a trade secret,
and that Wyeth had implemented reasonable efforts to maintain the secrecy.

It held that “Absolute secrecy is not required by MUTSA”, and that “Only reasonable efforts,
not all conceivable efforts, are required to protect the confidentiality of putative trade
secrets.”

The existence of a trade secret is not negated merely because an employee or other person has
acquired the trade secret without express or specific notice that it is a trade secret if, under all the
circumstances, the employee or other person knows or has reason to know that the owner intends
or expects the secrecy of the type of information comprising the trade secret to be maintained.

Based on the lack of repeated losses of confidential information regarding the Brandon Process
and Wyeth's use of physical security, limited access to confidential information, employee
training, document control, and oral and written understandings of confidentiality, the Court
concludes that Wyeth subjected the Brandon Process to efforts that are reasonable under the
circumstances to maintain its secrecy.

2. Whether Natural Biologics misappropriated Wyeth's trade secret process

Yes. Under the law, a person is liable for misappropriation of a trade secret if the defendant has
acquired the trade secret through improper means.

David Saveraid, the founder of Natural Biologics, engaged in communications with former Wyeth
chemist Dr. Irvine from October 1994 through early 1996. Saveraid's subsequent attempts to
conceal such communications, Natural Biologics's financial motives for copying the Brandon
Process, Saveraid's questionable ability to develop an extraction process identical to the Brandon
Process, the similarity between the Brandon Process and Natural Biologics's process, and the
absence of a credible record of how Natural Biologics developed its extraction process, support
the district court's conclusion that Natural Biologics acquired Wyeth's trade secret through
improper means.

Although Natural Biologics may have devoted its own resources and ingenuity to the development
of an extraction process, this is irrelevant because Natural Biologics also engaged in illegal conduct
by misappropriating Wyeth's trade secret.

2
Wyeth v. Natural Biologics Inc
395 F. 3d 897 - Court of Appeals, 8th Circuit 2005

3. Whether Wyeth's misappropriation claim is barred by MUTSA's statute of limitations

No. Under the law, an action for misappropriation must be brought within three years after the
misappropriation is discovered or by the exercise of reasonable diligence should have been
discovered.

The record does not suggest that prior to November 17, 1995, more than three years prior to the
commencement of the action, Wyeth knew or should have known facts sufficient to support a
lawsuit against Natural Biologics for trade secret misappropriation.

Wyeth knew nothing about how Natural Biologics had developed its extraction process, or who
had assisted the company in developing the process. Additionally, product samples were
unavailable before November 17, 1995, and Wyeth thus could not have confirmed any suspicions
that Natural Biologics had misappropriated its trade secret

4. Whether injunctive relief to prevent the Natural Biologics from selling or manufacturing
the product embodying the secret should be granted

Yes. Misappropriation of a trade secret constitutes irreparable harm that, under certain
circumstances, warrants injunctive relief to prevent the misappropriator from selling or
manufacturing the product embodying the secret.

Misappropriation would cause Wyeth irreparable harm in the form of loss of market share,
physician relationships, and control over the trade secret unless an injunction issued against
Natural Biologics.

As held by the district court, a permanent injunction was appropriate because "[i]n [Wyeth’s]
decades-long history, nobody has legitimately replicated the Brandon Process despite its value.”