Sandvik, Inc. v. Mecca C & S, Inc.

38 Pa. D. & C.5th 332
CourtPennsylvania Court of Common Pleas, Lackawanna County
DecidedMay 21, 2014
DocketNo. 13 CV 4003
StatusPublished

This text of 38 Pa. D. & C.5th 332 (Sandvik, Inc. v. Mecca C & S, Inc.) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Lackawanna County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sandvik, Inc. v. Mecca C & S, Inc., 38 Pa. D. & C.5th 332 (Pa. Super. Ct. 2014).

Opinion

NEALON, J.,

— -A manufacturer of custom-engineered power springs has sued its former employee for alleged misappropriation of trade secrets, and “upon information and belief’ based upon its review of the ex-employee’s business website, asserts that the defendant employee currently sells spring design software which improperly incorporates the manufacturer’s proprietary information in contravention of his employment agreements and Pennsylvania trade secrets law. The former employee contends that he has developed superior spring technology software utilizing publicly available engineering concepts and his own ingenuity. The ex-employee has appealed the special trial master’s discovery ruling requiring him to provide the manufacturer access to his spring technology software, and argues that the grant of such discovery will enable the manufacturer to discover and possibly replicate his proprietary information and confidential formulas that are reflected in that software.

In trade secrets discovery disputes, the party resisting discovery must first establish that the material sought constitutes protected proprietary information, and if that party does so, the burden shifts to the requesting party to demonstrate a compelling need for that discovery which outweighs the harm of its disclosure. The parties’ submissions indicate that the defendant employee’s [335]*335software contains his trade secrets and confidential equations. The manufacturer contends that it must, nevertheless, access that software to prove its trade secrets claims, while the ex-employee submits that the manufacturer has not demonstrated that its compelling need for such discovery outweighs the harm that the employee will suffer from the disclosure of his software to his business competitor and litigation adversary.

To resolve the parties’ circular arguments regarding the protected statuses of their trade secrets and software, a spring technology software expert will be appointed by the court to review the parties’ respective spring technology software, to determine whether the defendant employee’s software impermissibly integrates the manufacturer’s trade secrets as alleged, and pursuant to the protocol set forth in this memorandum and order, to prepare a report of the expert’s findings. After the expert has provided that report to the defense, the former employee may either (a) furnish it to the manufacturer or (b) file his objection(s) to its production to the manufacturer. In the latter event, the expert’s report will be submitted for an in camera review by the court to determine the discoverability of the report and the software at issue.

I. FACTUAL BACKGROUND

Plaintiff, Sandvik, Inc. (“Sandvik”), maintains a business unit, Sandvik Materials Technology, which designs and manufactures spring products, including custom-engineered power springs. (Docket entry no. 1 at ¶ 2). From October 1995 to July 2009, defendant, William Mecca (“Mecca”), was employed by Sandvik as a process engineer, senior production facilitator, [336]*336manufacturing engineering manager, and Spring China operations manager. (Id. at ¶ 3; Docket entry no. 3 at ¶ 3). In November 2009, Mecca formed defendant, Mecca C & S, Inc., which is engaged in the business of selling custom-engineered spring technology software. (Id. at ¶¶ 4,44).

Sandvik claims to have developed “spring technology software” which “employs an N-value term that allows the otherwise theoretical spiral spring calculations to have ‘real world’ application by creating idealized straight line torque and stress information.” (Docket entry no. 1 at ¶14). Sandvik avers that it has also designed “a Finite Element Analysis (“FEA”) that is capable of application to spring technology software and modeling.” (Id. at ¶ 16). According to Sandvik, its “software is a compilation of numerous data points, formulas and calculations, including use of a refined N-value term, which took Sandvik...many years and substantial funds to develop,” and “that allows it to manufacture custom-engineered springs based on the design specifications of its clients.” (Id. at ¶17).

During the course of his employment with Sandvik, Mecca allegedly “worked on development of spring technology and software” and “helped develop the confidential and proprietary software that allows [Sandvik] to manufacture custom-engineered springs based on the design specifications of its clients.” (Id. at^ 39,40). In that capacity, he ostensibly had access to Sandvik’s “technology related to the process for developing and producing spiral springs, software, design parameters, empirical data on endurance and performance, and application and use of the N-value term in spring development software [337]*337programming, including technology related to prestressed and precoiled springs.” (Id. at ¶ 37). While employed by Sandvik, Mecca reportedly “executed several agreements that prohibited him from disclosing or using Sandvik’s trade secrets and confidential business information other than in furtherance of his employment at Sandvik.” (Id. at ¶ 28). Specifically, Mecca’s employment agreements barred him divulging or using Sandvik’s “confidential or proprietary information” without Sandvik’s “prior written approval,” and required him to return any such information to Sandvik upon the termination of his employment.1 (Id. *¶¶31,33).

Sandvik contends that Mecca’s business “currently advertises online at http://www.spiral-spring.com/ as ‘Spiral Springs Solutions,’ offering consulting services, training, Power Spring Design services, and spring design software.” (Id. at ¶ 45). It is averred that Mecca’s website offers for sale Mecca’s “Power Spring Design Software” and “Spiral Hair Spring Design Software” which are described as using “numerous formulas and FEAmethods.” (Id. at ¶¶ 46-47). Based “[u]pon information and belief,” Sandvik asserts that “the Power Spring Design Software and Spiral Hair Spring Design Software available for sale on the Mecca C & S website incorporates and uses Sandvik’s confidential and proprietary spring technology software, including the numerous, complex calculations that Sandvik has spent substantial time refining.” (Id. [338]*338at ¶ 50). More particularly, Sandvik maintains that Mecca’s software improperly integrates Sandvik’s “use of the N-value calculation term,” “application of FEA to spring technology,” and “use of the refined N-value term necessary to allow[ ] theoretical calculations to have ‘real world’ application.” (Id. at ¶¶ 53, 54, 56, 58).

Sandvik filed a complaint against Mecca asserting causes of action for breach of the non-disclosure provisions of his employment contracts, misappropriation of trade secrets and confidential business information under the Pennsylvania Uniform Trade Secrets Act (“PUTSA”), 12 Pa. C.S.A. §5301, et seq., and unjust enrichment. (Id. at ¶¶ 71-107). In connection with those claims, Sandvik “sought information regarding [Mecca’s] development and sales of the spring software at issue, such as information transmitted over [Mecca’s] website, http://www.spiralspring.com/,” and demanded production of Mecca’s spring design “software and the design and development of [Mecca’s] spring software.” (Docket entry no. 9 at pp. 2-3). After Mecca objected to that software discovery on the ground that it seeks his own “trade secrets and confidential information,” (Docket entry no. 10 at p.

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Bluebook (online)
38 Pa. D. & C.5th 332, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sandvik-inc-v-mecca-c-s-inc-pactcompllackaw-2014.