2022 Ohio 3780
Ohio Ct. App.2022Background
- NTP, an Australian company, developed a proprietary wetting agent and had a confidentiality-based supply/technology relationship with Scotts Australia (SAPL) beginning in 2005.
- By mid‑2014–early 2015 NTP's director Karl Dunbar suspected misuse: he reported photos of NTP IP taken by SAPL staff, retained counsel, and traveled to multiple U.S. cities in Jan. 2015 to inspect Scotts products.
- At a February 18, 2015 meeting NTP accused SAPL/Scotts of using NTP’s wetting agent; meeting minutes reflect NTP believed an identical wetting agent was present in U.S. products.
- NTP performed chemical testing (C‑13 NMR) on Scotts products in November 2016, which it says confirmed the presence of its wetting agent; NTP sued Scotts on Nov. 8, 2019 for trade‑secret misappropriation, conversion and unjust enrichment.
- Scotts moved for summary judgment arguing OUTSA’s four‑year statute of limitations barred the claims; Scotts submitted exhibits authenticated by an initial Bresch affidavit and a later supplemental Sedor affidavit to authenticate documents provided by NTP’s agent.
- The trial court admitted the Sedor affidavit for authentication, denied NTP’s motions to strike, and granted summary judgment for Scotts on statute‑of‑limitations grounds; the court of appeals affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1) Leave to file supplemental affidavit (Sedor) after briefing began | Trial court abused discretion; Civ.R.6(B)(2) excusable‑neglect not shown for late filing | Motion for leave was made within the reply period and Civ.R.56(E) permits supplemental affidavits; trial court has discretion | Affirmed: no abuse of discretion; Sedor affidavit allowed for limited authentication purpose |
| 2) Motion to strike Bresch affidavit and authenticity/hearsay of exhibits | Bresch lacked personal knowledge so exhibits unauthenticated; exhibits are hearsay and inadmissible | Exhibits were produced to Scotts by NTP’s agent; Sedor corroborated receipt and chain, bringing exhibits within admission as party‑opponent statements | Affirmed: trial court did not abuse discretion; Exhibits A, C, D, E admissible under Evid.R.801(D)(2) and properly authenticated |
| 3) Whether defendant presented admissible evidence to meet initial summary‑judgment burden | Without admissible affidavits/exhibits, Scotts failed to carry initial burden | Sedor authenticated key exhibits; those exhibits support that discovery occurred >4 years before suit | Affirmed: Scotts met initial burden; documents admissible and sufficient |
| 4) Whether NTP was entitled to an opportunity to respond to Sedor affidavit | NTP was prejudiced and should have been allowed a surreply or response | Sedor added no new evidence or arguments—only authentication of existing exhibits; NTP had multiple opportunities to contest authenticity | Affirmed: no prejudice shown; trial court didn’t err in denying further response opportunity |
| 5) Whether OUTSA’s four‑year statute of limitations bars the claims (discovery rule) | Misappropriation not actually discovered until Nov. 2016 (chemical testing), so suit timely | NTP discovered or should have discovered misappropriation by Feb. 2015 (and at latest July 2014) based on chronology, inspections, counsel submissions and meeting minutes | Affirmed: misappropriation was discovered/should have been discovered by Feb. 2015; claims time‑barred |
Key Cases Cited
- Walter v. AlliedSignal, Inc., 131 Ohio App.3d 253 (3d Dist. 1999) (trial court may permit affidavits to be supplemented; discretion under Civ.R.56)
- Tokles & So, Inc. v. Midwestern Indemn. Co., 65 Ohio St.3d 621 (Ohio 1992) (only facts admissible in evidence may be relied upon on summary judgment)
- Schofield v. Cleveland Trust Co., 149 Ohio St. 133 (Ohio 1948) (definition of discovery for limitations purposes: facts that would lead a prudent person to further inquiry)
- Hambleton v. R.G. Barry Corp., 12 Ohio St.3d 179 (Ohio 1984) (discussing discovery rule and reasonable inquiry standard)
- Dresher v. Burt, 75 Ohio St.3d 280 (Ohio 1996) (moving party on summary judgment must point to evidentiary materials under Civ.R.56)
- Zivich v. Mentor Soccer Club, Inc., 82 Ohio St.3d 367 (Ohio 1998) (moving party bears the initial burden on summary judgment)
- Adcor Industries, Inc. v. Bevcorp, LLC, [citation="252 F. App'x 55"] (6th Cir. 2007) (applying OUTSA and discovery rule to trade‑secret misappropriation statute of limitations)
- Kehoe Component Sales, Inc. v. Best Lighting Products, Inc., 796 F.3d 576 (6th Cir. 2015) (OUTSA limitations period runs from first reasonably discoverable misappropriation)
- Stolle Machinery Co. v. RAM Precision Indus., [citation="605 F. App'x 473"] (6th Cir. 2015) (discovery rule requires timely, reasonable investigation by trade‑secret owner)