*3 many tion was and had complicated, twists WILSON, and Circuit Before CARNES turns, procedural and and both substan- *, Judge. District Judges, and JORDAN proceedings tive. We summarize the and JORDAN, Judge: District only necessary provide facts to insofar as context for our decision. trial, jury a two-week a found Following Research, Vanguard Inc. its that breached PEAT, Inc. appropriated contract with and A in trade secrets violation of the PEAT’s The PEAT and dispute between Van- Act, Trade Secrets
Alabama Ala.Code guard marketing and arose out of a license seq. The jury § 8-27-1 et awarded PEAT agreement the two entities between to cre- $325,981.01 on compensatory damages in plasma energy systems, ate which use ex- claim, of contract as well as the breach generated by plasma treme temperatures $1,819,334,00 in compensatory damages energy to treat hazardous waste without $8,890,000 punitive damages in on the and leaving byproducts. harmful behind claim. The court trade secrets district plasma PEAT energy referred to this Vanguard’s judgment motions for denied trial, technology “Thermal Destruction as and for as and a matter of law new but Recovery” (TDR), punitive damages Vanguard the award to while it reduced called $78,000 judgment accordingly. Pyrolosis System” and entered “Plasma Energy (PEPS). judg- the
Vanguard appeals now adverse claim, trade secrets not ment on the but doing started business with Vanguard jury or award on of the verdict the breach prior parent company, PEAT’s Mason & Vanguard claim. that argues contract Hanger, early through in the 1990s a ser- support there is insufficient evidence to marketing agreements. ies of non-exclusive claim, the verdict on the trade secrets that Vanguard essentially provided marketing it a is entitled to new trial due to the expertise and in government the area of of a improper admission Rule 1006 sum- contracting, Hanger while Mason & pro- mary purporting to exhibit list PEAT’s in technology plasma vided for use energy secrets, trade that the award of compensa- systems through subsidiary, a Plasma En- excessive, tory damages is that the and (old gineering Technology, Applied Inc. support not evidence does an award of PEAT). punitive below, damages. explained As we 1994, In Springer Dr. Marlin and other
reject Vanguard’s arguments all of con- old PEAT a evidence, engineers applied for cerning sufficiency patent the of the process using plasma for a required conclude that a new trial is due to to treat waste prejudicial the erroneous and energy. patent admission of The was in issued 1996 to * Jordan, reverse, Although Adalberto United States 1. we Honorable we commend the dis- handling Judge trict of the trial the court for its and of District for Southern District of Florida, many presented during the issues designation. the two- sitting by proceeding. week 5,534,659, prime The contract for Phase I—which Patent No. as U.S. Springer Dr. energy system— PEAT. a plasma an asset of old called for fixed and became 1998, February in of and was executed later, 1996, in several inves- years Two Vanguard PEAT and entered into a sub- from tors, Springer, bought Dr. including contract around that time for their work PEAT, of old Hanger the assets Mason & system I. PEAT designed on Phase the for com- patent. ’659 The new including the I in and it Phase Alabama assembled at PEAT name. Van- retained the pany Vanguard’s facility Virginia during in 1998. unsuccessfully pur- to tried guard, which I, Throughout Vanguard Phase criticized part of PEAT or be included as chase old aspects various of PEAT’s work. Not sur- to work purchasing group, continued the parties at trial the prisingly, presented separate a PEAT after it became with *4 very per- versions of PEAT’s different company. formance, problems as well as what exist- into a Vanguard PEAT and entered ed, were, significant problems how those pur- in to “teaming agreement” late 1996 responsible and who was for them. Valley a contract with the Tennessee sue 1997, PEAT Authority. August 1998, In of In Vanguard pro- June of made a license for Vanguard an exclusive granted II of posal project for Phase the —which (described system “the technology as its plasma energy sys- for a called mobile PEPS”) program for the involv- known as PEAT tem—and identified as a subcon- pro- and for “all follow-on ing the TVA PEAT received a letter subcon- tractor. pro- initial systems and to this grams in II tract for certain tasks Phase from the thereafter, Shortly parties the gram.” prime contractor the follow- government’s for a proposal a to the TVA submitted month, began working ing and thereafter a project develop plasma Phase I to ener- conceptual II is- Vanguard with on Phase gy system. Vanguard executed its Phase II sues. in prime a new contractor No- Vanguard PEAT and executed contract with the in De- marketing agreement and license trad- Though parties vember of 1998. the not agreement This did cember of 1997. proposals scope for the of work ed various make, use, a to or grant Vanguard license II, and PEAT never Vanguard on Phase Instead, system. develop plasma energy a them- a subcontract between executed separate that a agreement provided the II. selves for Phase for each subse- negotiated license would be per- II was of the work on Phase Some contract, Vanguard that would use quent simultaneously the work on with formed manufactur- PEAT as the sole source for during I. PEAT claimed that its Phase that energy systems, and ing plasma all II it shared much sensitive work on Phase title, and rights, PEAT exclusive retained Vanguard information with propriety property interest in all of its intellectual given that it had (though it also claimed infor- (including proprietary technical and throughout the information Vanguard such mation). a agreement The also contained I). part, for its Vanguard, Phase work on trial, PEAT merger clause. At asserted on or di- passed that PEAT had denied superseded the merger that this clause any trade secrets. vulged Vanguard, to while granted 1997 license it testing I in Phase undergoing While merger Vanguard maintained that the 1999, energy sys- January plasma the of license, 1997 clause did not affect the an by experienced PEAT designed tem for the separately provided which was 80-pound an door off explosion which blew I and for all “follow-on project Phase TVA disa- Again, parties the the incinerator. systems.” programs and 1158 discovery ruling which of, trial court’s responsibili- aside causes and the as to
greed customer orders re- Vanguard required blamed disclosure of for, explosion. ty the it claimed was minutes of by corporation and of design ceived poor PEAT’s —which PEAT while explosion, the of di- meetings corporation’s of board unsafe—for by was caused explosion the rectors, said generally constituted as such information safety components 8-27-2(1)). failure of various the § As the under trade secrets of the develop time to one and insufficient PEAT had the burden of estab- plaintiff, processes. relevant statutory elements as lishing each of these secret, Public claimed trade see to each month, Vanguard ordered following The 969, Towry, 587 So.2d Systems, Inc. v. I and Phase on Phase stop PEAT to work (Ala.1991), hotly issue at and a contested it clear Vanguard, to became According II. PEAT this bur- PEAT could not do satisfied explosion that trial was whether after the hand, PEAT, assert- job. on the other the den. a explosion the as Vanguard that used
ed C provid- PEAT the replacing for as pretext PEAT system. plasma energy er of the evidence, of presentation Before the termination, that, following its claimed object- in limine Vanguard filed a motion *5 its trade se- Vanguard misappropriated 145, of compilation PEAT Exhibit a ing to modify the Phase I used them to crets and PEAT’s trade purporting to list documents build the Phase system subsequently and motion, Vanguard argued In secrets.2 its system. II was not admissible as a that Exhibit 145 803(6) record under Rule because business B deposition in Springer Dr. had said his or not information consti Whether for PEAT’s counsel prepared that it was a generally question tutes a trade secret is began. R. 10:200. litigation after the See, The e.g., of fact under Alabama law. motion, PEAT argument on the During Inc., 1366, Ecolab, 646 So.2d Soap Co. v. pre- that Exhibit 145 had been conceded (Ala.1994). qualify To as a trade 1372 by request PEAT at the pared personnel, Alabama Trade Secrets secret under the counsel, in to response of PEAT’s Van- (1) Act, in information must be used or discovery that PEAT iden- guard’s request (2) business; tended for use in a trade or tify allegedly what trade secrets were mis- formula, or in a be included embodied R. 16:1 at 17. appropriated. software, computer pattern, compilation, Although Vanguard posi- reiterated its device, method, technique, or drawing, 803(6) that did not allow the tion Rule (3) process; publicly not be known and not Exhibit 145 because it was introduction of business; generally known in the trade or ordinary in the course of prepared not (4) readily not be ascertained or derived business, 18-19, PEAT R. 16:1 at never- (5) information; publicly from be available 145 was analo- argued theless that Exhibit subject of efforts to main the reasonable discovery response. a Alternative- gous to (6) secrecy; significant tain its and have PEAT that Exhibit 145 was ly, asserted § economic value. See AlaEode 8-27- attempt to summarize the entire 2(1). “[its] best Miltope Corp., 823 Ex Parte Cf. secrets, (Ala.2001) 640, of trade to summarize universe (granting pe So.2d 643-45 pre- setting for of mandamus and voluminous documents that had [it] tition writ appendix, opinion. reproduced 2. Exhibit 145 is in the and is described in more detail later in the
1159 on that to law claim is therefore affirmed. provided Vanguard.” ... had pared, [it] Eleventh 36-1. See Cir. Rule Vanguard responded R. 19-20. 16:1 at not introduce its own that PEAT could however, Reluctantly, we conclude that they because were responses discovery in admitting the district court erred Ex- could such (though Vanguard use hearsay 145, and sufficiently hibit that the error is PEAT if it responses against admissions as light to a trial. In prejudicial require new no wished), that there was list of trade and trial, grant our of a we do not of new reach under 1006: to summarize Rule secrets Vanguard’s compensa- that the arguments that was something “This made where is tory damages and that are excessive the said, well, and sat around people different permit puni- evidence does not an award of and up come with claim to be what can we damages. tive trade It doesn’t meet the criteria secrets. A it discovery, It fine for is
for admission. is ..., questions but it’s fine to use to ask We the admission of Ex review that allowed just the kind of record is not discretion, which, hibit 145 for abuse of at in of evidence.” R. 16:1 under the rules that if the means we look to see district judgment court “made a clear error of ... 20-22. legal applied or ... an incorrect stan that Exhibit 145 replied PEAT After County, v. Fulton 207 dard.” Alexander summary” the con- was a “classic because (citation Cir.2000) 1303, (11th F.3d and not be tents voluminous could were omitted). internal marks quotation and court, the district court over- in examined Although controlled the Alabama law sub told it objection Vanguard ruled and the action, diversity in this “the stantive issues to “as the veraci- question could witnesses in admissibility federal courts of evidence *6 R. ty of in Exhibit 145.” the information Borden, law,” governed by Inc. is federal permit- 16:1 court also at 22. The district Co., 772 Ry. Florida F.2d v. East Coast standing objection have a Vanguard ted to (11th Cir.1985), 750, turn to 754 so we Rule 22. to 145. R. 16:1 at Exhibit 1006, provision the under which Exhibit standing objection the Notwithstanding was 145 admitted. court, by Vanguard the district allowed objection when lodged contemporaneous a pro In 1006 part, relevant Rule PEAT to introduce Exhibit 145 sought that of voluminous vides “the contents R. Dr. 16:2 at 231 through Springer. records, writings, photographs which or (“Same objection previous- as we discussed in court conveniently cannot be examined objec- ly.”). chart, district court noted the The of a may presented the form be in and, prior ruling, with its tion consistent summary, admit calculation^]” or Once R. 16:2 at 231. ted, overruled it. a Rule constitutes sub 1006 exhibit See, e.g., States stantive evidence. United
II (5th 1179, Smyth, 1184 Cir. v. 556 F.2d 1977) (“Although the word ‘evidence’ does thorough examination of the rec- After the ord, appear in we construe rule a of the entire 2500- not its text including review evidenee[.]”). reject, treating as transcript, we without as summaries page trial discussion, And because are elevated un Vanguard’s argument “summaries further evidence, position Rule the of sup- that to der 1006 to there is insufficient evidence argumentative omit PEAT’s care must be taken to port the verdict on trade secrets jury the in lest preparation court’s denial of matter their claim. The district Van- itself evidence that matter is guard’s judgment as a matter of believe such motion for 1160 satisfy n. Exhibit 145 to this it makes.” Id. at 1184 fails
of the assertion
evidentiary
it
requirement,
foundational
as
12.
comprised
hearsay
is
of classic
—state
on
materials or documents
The
by
of court
persons
ments made outside
exhibit is based must be
a Rule 1006
which
declarant,
for
other than the
introduced
copying
or
for “examination
made available
(that
the truth of the matter asserted
at
reasonable time
by
parties
[a]
...
other
PEAT in fact had trade secrets it shared
not
admitted into
place,”
and
but need
be
Vanguard),
with
and not admissible under
introduced,
they
If
are not
how
evidence.
any hearsay exception. Exhibit 145 con
ever,
must
those materials or documents
self-serving
tains numerous
documents
the Federal Rules of
admissible under
be
by PEAT
this
prepared
after
action was
words,
In
Rule 1006 is
other
Evidence.
(a)
prepared by
engi
filed:
a list
a PEAT
a
vehicle for the introduc
not
back-door
“[tjrade
shown,
neer of 109
secrets
dis
tion of
which is otherwise inad
evidence
(b)
cussed,
provided
[Vanguard];”
or
to
a
generally
missible. See
J.
J.
MoLaughlin,
“recap”
provided
of
to
“[tirade [s]ecrets
WeinsteiN,
BeRgee, 6
& M.
Weinstein’s
7, 2000,
[Vanguard]”
January
dated
with
(2d
§
ed.
1006.03[3]
Federal
Evidence
eonclusory statements like
con
“[e]hamber
2004) (“Charts, summaries, and calcula
figuration trade secrets include the size
only
tions are
admissible when based on
shape
rectangular
cylin
and
of both
and
duplicate materials that are
original or
chambers,
locations,
drical
instrumentation
evidence.”);
themselves admissible
C.A.
and
and
entrance
exit locations for the
Wright
& V.J.
31
Gold,
Federal
Practice
penetrations
various chamber
when used
(2000)
8043,
§
at 527
and Procedure
process
organic
to
a mixture of
and non-
(“Rule
may
1006 evidence
also be excluded
organic
reducing
waste materials in a
at
where the
materials are inadmissi
source
(c)
mosphere to
a
produce
syn-gas;” and
a
hearsay
just
parts
ble
or even where
some
checklist,
30, 1999,
dated December
and
of those materials are
hear
inadmissible
explanation,
devoid of
of
PEAT
23
“trade
say.”).
example,
explained
For
we
in
secrets.” Exhibit 145
copy
also includes a
Goss,
1336,
United States v.
650 F.2d
1344
patent
of the ’659
issued to Dr. Springer
(5th
1981),
n.
A
Cir. Unit
that Rule 1006
9,
and,
1996,
all,
July
on
of
worst
two
permit
does not
“the admission of summar
(each
memoranda
pages long) pre
seven
*7
testimony
ies of the
of out-of-court wit
pared by Dr. Springer,
principal
PEAT’s
testimony
nesses” because such
would be
corporate representative,
January
and
on
hearsay. See also United States v. Fran
14, 2000, after
litigation began.
the
The
(11th
cis,
Cir.1997)
1452,
131 F.3d
1457-58
memoranda,
similar,
though
are not identi
(rejecting challenge to admission of Rule
memorandum,
In
cal.
the first
Dr.
calls,
1006
intercepted phone
summaries of
Springer provides a
of
definition
trade se
part
in
underlying
because
calls and tran
crets which is broader than that
forth
set
evidence);
scripts were
into
admitted
in
Dr. Springer prefaces
Alabama law.
Norton,
United
v.
States
1161 claims, of PEAT’s R. 16:1 many knowledge employees. of which and sory statements (PEAT’s of trade secrets prepared the existence “it was go beyond at 17 counsel: mis- Vanguard’s alleged on and comment in to by personnel response PEAT ... a intent: and appropriation asking identify ... request PEAT to what have personnel ... PEAT “Since 1992 misap trade secrets we contended were secrets continually many shared trade 264, propriated by Vanguard”); R. 16:1 at [Vanguard].” with (testimony by to 445 the same effect Dr. early “It clear in the PEPS became Thus, correctly ar Springer). Vanguard Project Vanguard’s that intent Phase [I] gued that the underlying below materials ... trade secrets asso- was to assimilate or information on which Exhibit 145 was manufacturings, design, the ciated with were not admissible under based Rule and key equipment of procurement and 803(6) they during, prepared because were (PEAT’s designated major subsystems in, litigation. R. at and for use 16:1 19. role).” Dept. See Noble v. Alabama Environ of [i.e., knowledge this the “The source of 361, Management, mental F.2d 366 872 it considering and basis technology] for (11th (document Cir.1989) in an prepared a was the lack of informa- trade secret litigation “compiled of as ticipation is not a in industry.” tion the available regular practice” purposes matter of for of capa- “[K]nowledge of different vendor 803(b)). That Rule meant that Exhibit specifications ... is con- bilities to meet 145 could not be introduced under Rule trade secret.” sidered a prepared 1006. “Summaries of records control processing “The chamber and inadmissible[,] litigation are indeed ... for the system highly proprietary is and are not and inadmissible documents made design of both are considered detail by being AM- admissible summarized.” trade secret.” PAT/Midwest, Works, Inc. v. Illinois Tool Vanguard “It evident that also became Cir.1990). 1035, (7th Inc. 896 F.2d 1045 had been instructed to mount employees Authority, Housing also Hackett v. See suf- gathering a effort toward relentless Cir.1985) (race (5th 1308, 1311-12 750 F.2d in order ficient trade secret information landlord, each which was determined of design, manufacturing, pro- to take over owners, a few based on conversations with curement, of integration, operation and hearsay, and constituted inadmissible PEPS.” future exhibit); part 1006 could not form of Rule earlier, As 145 not noted Exhibit was Christensen, Inc., Dave 745 Paddack v. ordinary compiled in the course of busi- Cir.1984) (audit (9th 1254, re 1260 F.2d Instead, employees ness. PEAT its and have not admitted under port should been Dr. Exhibit (including Springer) prepared it in part 1006 because based on Rule was of to during litigation the course this *8 information derived from sources “[u]nion respond discovery request Vanguard’s to cross-examination,” subject ... to and not identify that PEAT what secrets trade identify portions not of could what witness Dr. misappropriated. were allegedly not from inadmissible report were derived essentially admitted that Exhibit Springer sum, In 145 was hearsay). Exhibit based overbroad, the compiled 145 as he was hearsay and contained on inadmissible everything [he] information “to include conclusory allegations concerning Van be a trade R. 16:2 thought might secret.” and in alleged misappropriation guard’s added). Moreover, 264, (emphasis at 267 discre court its below, tent. The district abused as clear Exhibit 145 was was made admitting it 1006. in under Rule large part in on the first-hand tion based 1162 that it was
B
such one-sided evidence” such
remote,
jury
“unlikely,
that
the
indeed
error,
evidentiary
of
every
Not
erroneously by
swayed
could have been
cases, con
course,
Our
requires reversal.
evidence”), with,
wrongfully admitted
the
of the Federal Rules
Rule 61
with
sistent
Tieco,
Steel,
v.
Inc. 261 F.3d
e.g., U.S.
LLC
Procedure,3
a
trial is
hold that
new
of Civil
(11th Cir.2001)
1275,
(improper ad-
1288
the error has caused
only where
warranted
judicial opinion required
of
a
mission
state
party
to the affected
prejudice
substantial
opinion
by
trial
was used
one of
new
where
differently,
(or,
affected
somewhat
stated
parties “throughout
help
the trial” to
rights” or resulted
the
“substantial
party’s
the
See,
injustice”).
e.g. Hall v.
and counsel told
disputed
in “substantial
establish
facts
America,
1255,
367 F.3d
Ins. Co.
jury
closing argument
United
in
“to use the
the
of
Cir.2004) (“substantial
(11th
prej
1258-59
credibility determina-
opinion to make
Alexander,
udice”);
1163 cusations) property, Ex- not all of the trade Springer meant that intellectual by Dr. in not confined to whether secrets listed Exhibit 145 were con- hibit 145 was secrets, over carried in the the contract de- PEAT had trade but tained schedule to questions of whether Van- trade to separate tailing being to the the secrets sold se- any 408-13; of those guard misappropriated DAE. R. 16:3 at Def. Exh. 321. law, and in of Kelly explanation ap- crets violation Alabama had an this Mr. for was Vanguard’s misappropriation parent whether discrepancy reading based on his of malicious,” for the standard “willful and e.g., DAE contract the and the schedule — damages the Ala- under awarding punitive that term he said the “all data” covered Secrets Act. Ala.Code bama Trade listed, specifically was not R. 16:3 at what § 8- instruction). 27-4(3); (jury R. 20:2 at 2528 important that his point 413—but the is testimony on this issue not over- was Third, though PEAT Exhibit even used whelming. 145 to the exis- with its witnesses establish secrets, the evidence on tence of trade the experts PEAT’s did not fare much bet- below, close. As issue was discussed specifically in the trade se- identifying ter Ex- witnesses that PEAT’s own admitted crets, presented and sometimes alternative overbroad, generally hibit 145 was and versions of what the trade secrets were. identify with were not able to trade secrets Lindsay, engineer spe- a Richard chemical Moreover, Vanguard particularity. much cializing in thermal and heat dynamics sug- fair amount presented a of evidence transfer, in testified that the items listed any pro- PEAT did have gesting that not to “normally Exhibit 145 were considered tected trade secrets. practice secrets the in be trade within 761, industry,” R. he 16:4 at but evidence, [the]
Looking first at PEAT’s own cross-examination, hedged his answer on corporate Dr. was Springer, who PEAT’s that the “areas that (a) saying items were Exhibit representative, testified that be consideration typically areas for would PEAT everything 145 list of that was “a (em- secrets,” of the trade R. 16:4 at 780 myself my engineering and personnel, added). if the list in phasis When asked staff, and tech- proprietary felt constituted included, vague, 145 was he conceded that Exhibit that se- nical information trade relatively elu- generally are “trade secrets added); crets,” (emphasis R. 16:1 at 231 sive,” 780-81, R. 16:4 at and when asked (b) “every- 145 was a list of that Exhibit specific in Exhibit it was about items what might a trade se- thought be thing [he] rapid quench gases) that made (e.g., 145 of added); cret,” 264, at 267 (emphasis R. 16:2 secrets, as fol- trade he answered (c) them 145— that one of the items in Exhibit exactly you “I probably can’t tell lows: agen- test data sent to state emissions I IBut can it is because couldn’t. what as a even cies'—was claimed trade secret R. 16:4 you general ... the area.” at tell review, public was available for though it further, Mr. Lind- questioned (d) 781. When 265-66; R. and that there was 16:1 at (somewhat tautologically) that say said in the secrets overlap” “some list of trade you produces that the result “the result 145, in R. 16:1 at 273. Thomas Exhibit secret,” and admit- (and the trade want defines chairman Kelly, PEAT’s of the board “just saying this is the area that, ted he was shareholder), acknowledged a 20% give you secrets lie in. I can’t that trade not prior suing Vanguard, PEAT did to 782, 16:4 at trade R. the exact secret.” inventory of trade secrets. have a list or its end, Lindsay In the Mr. said that Moreover, PEAT 783. R. at when 16:3 408. might “way the whole in secrets be the Technologies to DAE late trade sold its assets 2002, further elab- together,” of its fits without early conveyed system and all and *10 784, 787, necessarily 789. Alterna- constitute trade secrets. R. R. 16:4 at oration. that, 1181, to respect with some that tively, he said 16:6 at 1187. He also stated repeated in some form or that were items of the items listed in Exhibit 145 “none” 145, “the trade secret is in Exhibit secrets, another why explained were trade he so process.” in the R. 16:4 placed where it’s opined, jury told the that about two-thirds expert, Thomas at 792. PEAT’s other of the items in Exhibit 145 were covered with a mas- Eddy, engineer a mechanical by in or patent claims the ’659 could be plasma, did his thesis on degree ter’s who readily language pat- inferred from in the in that 10 of the items Exhibit admitted skill, by and ent someone with reasonable Springer’s patent in Dr. 145 were included general testified that the incantation of a not trade secrets. R. and-therefore were a process or formula did not constitute Eddy identified some 16:4 at 851. Mr. PEAT provided specif- trade secret unless that he believed specific matters were 1189, 1254, Jay ics. R. 16:6 at 1266-67. (e.g., configuration the of the trade secrets Ramamurthi, Vanguard engi- a industrial interiors, chamber, design the of the and project manager, neer and stated that information), refractory the and testified Vanguard any did not use PEAT trade that, patent, from the generally aside the II, explained secrets on Phase and how items listed in Exhibit 145 were trade se- Vanguard complete sys- was able' to the 853-54, at industry. crets in the R. 16:4 using tem for Phase II without PEAT’s Yet when asked on direct examina- 875. unique technology or trade secrets. R. identify examples of PEAT tion to some Kantak, 16:8 at 1725-28. John a Van- secrets, Eddy always trade Mr. could not guard vice-president, senior that explained specific: be lot of these are tied to- “[A] engineers when and PEAT VRI worked just gether. you separate It’s not like can together information, in teams and shared in They groups.” them. are kind of R. Vanguard requested the data from PEAT Indeed, cross-examination, 16:4 at 852. on engineers was not trade secret informa- Eddy point single spe- Mr. could not to a tion. Finally, R. 16:8 at 1978-79. Gordon cific formula that was a PEAT trade secret Smith, Vanguard’s corporate representa- given Vanguard. and was to or shared with tive, jury told the the 1998 Phase II that R. 16:4 at 917. by work PEAT was not marked as trade part, Vanguard presented For its evi- secrets. R. 20:1 at 2334. any dence that PEAT have did not trade Like PEAT’s witnesses on the of issue law. secrets under Alabama John Sum- secrets, trade Vanguard’s witnesses were ner, Vanguard’s one of founders and offi- repeatedly challenged about their testimo- cers, program manager and a deputy for ny topic, on this and we do not mean to plasma system the energy program, testi- suggest example, otherwise. For Mr. Vav- that PEAT although personnel fied dis- ruska, though pressed not on specifics, cussed proprietary information at meet- conceded on cross-examination that infor- (like ings Vanguard meeting with a in (i.e., specific mation for use in a process a 1998), January they of never referred to unique application process) to one’s own such information as trade secrets. Mr. could be a trade secret. R. 16:6 at 1262. anyone Sumner also said he did not recall admitted, And Ramamurthi Mr. also on at PEAT using the term trade secrets. cross-examination, that there were Vavruska, R. 16:6 at 1121. John Van- “unique” “proprietary” aspects and to Van- guard’s expert engineering, on chemical guard’s system, 1747, Phase II R. 16:8 at patents testified that there were about 24 issued, waste, thereby plasma suggesting system for of for that PEAT’s the use and proprietary unique that information did not was in proprietary also and some
1165 conclusory specific allegations er’s comments and maybe even included ways, and pur- our Vanguard’s alleged misappropriation matters for secrets. What about trade however, put on Vanguard is that The poses, and intent. district court read the fact and both evidence—from substantial a statutory definition of secret to the trade the claim witnesses —to counter expert the in jury, jury and instructed that decid- by trade as defined PEAT had secrets that ing what trade secrets it was not existed 8-27-2(1). § by testimony any or bound the of witness any on R. 16:2 at the notation document. Fourth, PEAT’s on Exhibit 145 reliance 168-69, 206-07; R. 20:2 2512-13. The it at important critical times showed how at evidentiary jury court also told the that a puzzle. in When Van- district was the record, of for a as a matter guard judgment moved is a matter of and patent public claim, trade the district law on the secrets can- patent that information disclosed in a aré trade secrets?” court asked “What the secret. at not be a trade R. 20:2 2518. “[t]hey that were identi- responded PEAT instructions, however, not suffi- These did the by Eddy,” Dr. and told specifically fied ciently prejudicial eliminate or reduce the that 145 “listed” the court Exhibit district of the inadmissible evidence and effect (explaining R 16:8 2421 secrets. at trade in Exhibit statements 145. use of [the the trade secrets were “the that not to “knowledge or the of what process]” Ill use”).4 Then, argument, in in an closing transcript provides The trial no clear jury the that it had trade to convince effort PEAT answer as to what trade secrets secrets, PEAT 145: “You invoked Exhibit had, it, any, if in Phase II. the As we see jury ... in the have Exhibit 145 back will jury allowed the to find for either evidence all the you. you And heard room with the on this threshold issue. Because side why created and about it was evidence close, of evidence was so the admission things of groups all is on it and the what 145 constituted reversible error. Exhibit it and all that.” R.20:2 at 2549. that are on and in favor jury judgment The verdict Fifth, disputes par- the because between PEAT on the claim is of trade secrets I to as to Phase had been submitted ties reversed, that claim for a and is remanded arbitration, PEAT’s trade secrets claim reject argu- trial. Vanguard’s new We by limited to trade secrets obtained was presented PEAT ev- ment that insufficient from I subcon- Vanguard “apart the Phase claim, trade and do on the secrets idence instruction). (jury 20:2 at tract.” R. 2503 Vanguard’s arguments concern- not reach from the There was no clear demarcation dam- ing compensatory punitive the and secrets, to at trial as which trade evidence by jury the claim.5 awarded on that ages limitation, this and the any, if satisfied verdict, 21:215, R. not identi- PART, does general IN REVERSED AFFIRMED to the fy proved trade secrets PEAT PART, what AND REMANDED. IN jury’s satisfaction. WILSON, concurring: Judge, Circuit
Sixth, tell, far as we the district as can I in case. agree I with the result this give any limiting instruction court did not it is separately emphasize to that write of 145 which con- portions on the Exhibit that I concur hearsay Spring- only great Mr. with reluctance tained inadmissible or court, Vanguard’s jury’s in PEAT on the denying The verdict favor of 4. The district in 5. motion, by the claim of contract is not affected said it would let the trade secrets breach trial, Vanguard did not jury they grant "go the can sort of a new as claim to and see if appeal from that verdict. 16:8 at it out.” R 2421-22. 1166 court is reluctant to overturn the admitting appellate in Exhibit the error
that *12 to warrant a sufficiently prejudicial was rulings judge.” of a district Ramos v. trial. new Co., 334, Liberty Mut. Ins. 615 F.2d 343 (5th Cir.1980). lightly concern is whether Van- It that we My primary is not any preju- demonstrable guard suffered judge’s evidentiary findings, a trial disturb dice; had access appears Vanguard it that greater it that we and is with even unease trial, had long Exhibit 145 before and to jury by interfere with the result reached a to cross-examine ample opportunity well-litigated an case. after otherwise prob- about whatever PEAT’s witnesses However, complex this was a and often evidentiary submission. existed in the lems confusing matter that turned on close fac- addition, crafted Ex- In PEAT’s counsel addition, questions. tual In the district discovery in a re- response hibit 145 to give limiting court did not a instruction iron- quest Vanguard; from it is somewhat regard any with to of Exhibit 145’s eviden- argues now to have the Vanguard ic that tiary problems. presence The of such an overturned as a result of the judgment very instruction could well have led us to a prepare. it PEAT to very materials asked today. result different prac- I am further concerned about the remanding tical of this mat- considerations noted, Eighth As the has Circuit ter for a new trial. We now allow Van- “[wjhere subject litiga the matter of the in in guard apple another at the a case bite simple, straightfor tion is the evidence already rejected majori- the which we have ward, unconfused, legal and the issues ty Vanguard’s arguments, upset- of thus properly courts are reluctant to overturn in ting strong finality our interests and jury’s grant the verdict and to a new trial.” litigat- efficiency. This matter will now be Stores, Coast-to-Coast Inc. v. Womack- again, significant expense ed at time and Bowers, Inc., (8th 1398, 818 F.2d 1403 Yet, parties. to the Exhibit 145 contains Cir.1987). hearsay very that present presents inadmissible well could The ease the jury. have made a difference to the infrequent justi occasion in an which error a only fies new trial —a result we reach written, predecessor As our court has “[ajfter trial, hotly fought long great a and an with caution.
APPENDIX *15 - Secrets Provided to VRI Trade Recap Design Chamber secretes design configuration, trade include Chamber Mix Oxidant, chamber, configuration Chamber torch trade secrets and include the refractory impacts. rectangular chambers, and and of both size instrumentation cylindrical shape the various and locations for chamber locations, penetrations and entrance exit non-organic organic waste of and a mixture materials a used when to in process syn-gas. reducing design trade secret is a Another to the atmosphere produce a Mix chamber to and use of solve the improve and for theory efficiency gas mixing hot with maintenance, temperature turbulence, associated problems gas Use of oxidant addition to duration, and hot stabilize quality. .locations processing chamber, reactions the the to the chemical in impact process for and fine tune various the from the mix oxidants, of chamber types process is another trade secret. has oxidant locations PEAT conducted numerous Input and materials to various families of materials tests of determine best refractory be reducing to used in or of materials with chlorine and atmospheres type family in the waste Some other chemical stream. vendors have even refractory present under conditions us that have tested more these than told we refractory they have behind the and tested. The torch and chamber location theory movabiiity tapping feed and to maximum maximum relationships turbulence, impart chamber wall and thermal effects is another trade secret.
flexibility, minimal
H71 /////PEAT, PROPRIETARY INFORMATION///// inc.
PEAT, inc. CONFIDENTIAL COMPANY
H77 *30 1186 *31 VRj discussed, provided shown, to or Secrets
Trade
Hg9 *40 1197 *44 Guirlaine O’ROURKE, Plaintiff-Appellee, v.
Christopher HAYES, individually, Defendant-Appellant, No. 03-10795.