George v. Schirra

814 A.2d 202, 2002 Pa. Super. 395, 2002 Pa. Super. LEXIS 3815
CourtSuperior Court of Pennsylvania
DecidedDecember 18, 2002
StatusPublished
Cited by25 cases

This text of 814 A.2d 202 (George v. Schirra) is published on Counsel Stack Legal Research, covering Superior Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
George v. Schirra, 814 A.2d 202, 2002 Pa. Super. 395, 2002 Pa. Super. LEXIS 3815 (Pa. Ct. App. 2002).

Opinion

BENDER, J.:

¶ 1 This is an appeal from an order denying reconsideration of a discovery order regarding alleged trade secrets. Appellants allege four errors on the part of the trial court: the court improperly allowed the discovery of Home Lab Notes containing confidential trade secrets of Appellant; the Home Lab Notes are not relevant to the current litigation; the master’s finding that the Home Lab Notes “may relate in some way” to the matters of the current litigation is incorrect and an insufficient reason for ordering their disclosure and the order requiring the disclosure was premature. We affirm.

¶ 2 The present case alleges misappropriation and use by Appellees of protecta-ble trade secrets of Appellants, namely “flow-aid” products — products which are instrumental in the steel making process. In the 1970’s and 1980’s, Appellant George was employed by Jones & Laughlin Steel (J & L) as an engineer. During his employment with J & L, one problem facing J & L in the production of steel involved the clumping, or agglomeration, of lime and other powdered constituents of steel manufacturing. George became involved in experiments to alleviate the agglomeration problem at J & L and, he alleges, further conducted “independent” tests at his home.

¶ 3 Sometime in the mid-1980’s, George left J & L and formed his own company producing “flow-aid” products. Appellee John Schirra was employed in the quality assurance department of ESM, II Inc. (ESM). Appellants allege that while employed with ESM, Schirra obtained certain trade secrets relating to flow-aids from George which were disclosed in confidence. Schirra subsequently left ESM and joined Appellee, FBC, Inc. Appellants allege that Schirra divulged George’s confidential trade secrets to principals at FBC, which then used them to compete unfairly against Appellants. In response, Appellants filed the instant suit seeking monetary damages and an injunction.

¶ 4 Perhaps not unexpectedly given the nature of the instant litigation, many dis *204 putes arose during the pre-trial discovery-process, including some relating to the discovery of materials Appellants believed to be trade secrets additional and unrelated to those allegedly appropriated by Appel-lees. More specifically, the primary issue of contention dealt with production of George’s “Home Lab Notes,” notes allegedly relating to experiments conducted on George’s own time at his home, which, he asserts, are his own proprietary work product. To deal with the various discovery disputes, a special master was appointed on December 8, 1999, to hear evidence and arguments as to the disputes as well as to issue a report and recommended resolution. During that process, Appellants argued that the Home Lab Notes were not relevant to the present litigation and were entitled to protection under Pennsylvania law. Appellees countered that the Home Lab Notes are indeed germane to potential defenses they would employ and that Appellants could not be allowed to determine what evidence was and was not relevant to the litigation. The special master issued his report and recommendation on May 29, 2001.

¶ 5 Appellants filed exceptions to the report and recommendation, which were denied on August 3, 2001. Appellants responded by filing a motion for reconsideration on August 23, 2001. On August 30, 2001, the motion was granted for purposes of revisiting the decision, yet, the motion was quickly denied on September 4, 2001. However, in consideration of Appellants’ claims that the information constituted trade secrets, the court ordered that the documents in dispute be produced under a protective order to be viewed only by Ap-pellees’ counsel and an expert retained for purposes of reviewing the notes and determining their potential relevance to the trial. The protective order further provided that the information contained in the notes could not be revealed to Appellees or utilized without a subsequent court order. The present appeal followed. 1

¶ 6 As a preface to the discussion that will follow, we would point out that, as a general rule, discovery is liberally allowed with respect to any matter, not privileged, which is relevant to the cause being tried. See generally, Pa.R.C.P. 4003.1, Land v. State Farm Mutual Insurance Co., 410 Pa.Super. 579, 600 A.2d 605 (1991). Although Appellants are correct that trade secrets are afforded protection under the law, “there is no absolute privilege or unconditional bar as to disclosure of such matters.” Miller Oral Surgery, Inc. v. Dinello, 416 Pa.Super. 310, 611 A.2d 232, 236 (1992). Moreover, the question “whether disclosure is to be allowed and, if protection is to be afforded, the form of such protection, are matters to be determined according to the discretion of the court.” Id. Most importantly, stewardship of the trial, including discovery rulings, are “uniquely within the discretion of the trial judge,” Air Products and Chemicals, Inc. v. Johnson, 296 Pa.Super. 405, 442 A.2d 1114, 1129 (1982), and, consequently, the court’s rulings will not be reversed unless they are deemed to represent an abuse of discretion. Id.

¶ 7 Citing to Hagy v. Premier Manufacturing Corp., 404 Pa. 330, 172 A.2d 283 (1961), Appellants first assert that the court cannot allow discovery of trade secrets by a competitor. While Hagy does state “that discovery which would reveal confidential information or trade secrets to a competitor, ... should *205 not be allowed,” Id. at 284-85, the passage is offered as a general, almost dictum-like, statement. The above statement cannot be regarded as a definitive rule of law that comprehensively prohibits any discovery touching upon trade secrets. Indeed, as the other cases Appellants cite to attest, discovery of trade secrets has been allowed post-Hagy. In both Air Products, supra., and Miller Oral Surgery, supra., both dealing with trade secrets, some form of discovery was allowed over contentions that such discovery was not permitted. Thus, clearly, the mere fact that the subject matter of discovery might be trade secrets does not necessarily exempt the information from the discovery process.

¶ 8 Appellants next assert that the “Home Lab Notes” are not material to the litigation at hand. In a closely related argument, Appellants follow-up that argument with the contention that seemingly suggests that there exists a different discovery standard with respect to trade secrets. We address the second contention first.

¶ 9 As acknowledged above, while trade secrets are entitled to protection, we do not believe Appellants have demonstrated that there exists a different relevancy standard with respect to discovery of material that might constitute trade secrets. Appellants cite to Hagy, supra.,

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Bluebook (online)
814 A.2d 202, 2002 Pa. Super. 395, 2002 Pa. Super. LEXIS 3815, Counsel Stack Legal Research, https://law.counselstack.com/opinion/george-v-schirra-pasuperct-2002.