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July 29, 2003


The opinion of the court was delivered by: Michael Mason, Magistrate Judge


On July 15, 2003 the parties appeared before us for resolution of several discovery motions filed by the plaintiff. At that time, we ordered defendant to submit response briefs to several of the motions. Following are our orders with regard to them:

1. Plaintiff's Motion for Protective Order to Prevent Defendant From Intimidating Trial Witnesses and Destroying Evidence

Plaintiff alleges that defendant has been intimidating trial witnesses who have given deposition testimony on behalf of the plaintiff It is true that defendant has filed a lawsuit against at least one deponent. However, this individual is a former employee of defendant who defendant accuses of violating the California Trade Secrets Act. At this point, there is no evidence that defendant's law suit is frivolous or was filed for an improper purpose, and no other evidence of defendant behaving improperly toward witnesses, so we deny plaintiff's motion for a protective order regarding intimidation of witnesses.

With respect to the destruction of evidence, two outstanding issues remain, the rest having been resolved in open court. First is the question of defendant's business [ Page 2]

proposals, why they were produced late and in redacted form, and whether any have been destroyed. At one point, defendant's attorney told the Court that there existed, "about 880 pages of customers". It is these documents that have also been identified as so-called "business proposals". Defendant has produced the customer list/business proposals (which appear to be lists of customers and potential customers), but in redacted form, and produced them approximately two months late. Defendant argues that it did so because its customer lists are trade secrets and it has evidence that plaintiff has been unfairly targeting defendant's customers.

Under Illinois law, a customer list may be a protectible trade secret only when "the information has been developed by the [party] over a number of years at great expense and kept under tight security." A.J. Dralle, Inc. v. Air Technologies, Inc., 627 N.E.2d 690, 697 (Ill.App. 1994). Such information is not protectible if it has not been treated as confidential, was generally available or known to employees or other people in the trade, could be easily duplicated by reference to telephone books or industry publications, or where the identity of customers was known to a party's competitors because the customers either changed businesses frequently or engaged in business with more than one company. Id., citing Office Mates 5, North Shore, Inc. v. Haze, 599 N.E.2d 1072, (Ill.App. 1992). Defendant has not provided any evidence to convince us that its customer lists constitute protectible trade secrets other than its bald statement that they are secret. Thus, we order defendant to provide plaintiff with an unredacted version of its customer lists/business proposals, but allow the defendant to designate them as "attorney's eyes only." We also strongly suggest that the parties [ Page 3]

enter into an agreed protective order regarding alleged confidential information in order to prevent these types of issues from arising in the future.

The second outstanding issue concerns the fact that defendant's controller testified at her deposition that she redacted the detail regarding payment of a $30,000.00 check on the order of the president of defendant, Doug Cwiertnia. Cwiertnia had already been deposed, denying the existence of any $30,000.00 payments. Plaintiff asks that we order defendant to pay for the costs of plaintiff having to redepose Cwiertnia and the controller. Plaintiff alleges that information exists implying that this payment was a bribe, made to secure business for defendant. Defendant argues that evidence of a payment does not equate to evidence of a bribe. However, given defendant's president's statement under oath that no payment was made at all, coupled with the controller's testimony, we find that enough evidence exists to order Cwiertnia to sit for a second deposition at the expense of defendant, but that the questions should be confined to questions regarding the $30,000.00 payment and its redaction from defendant's books. We don't find any reason to redepose the controller. Therefore, we grant in part and deny in part plaintiff's motion for protective order,

2. Motion to Enforce Subpoenas Seeking Evidence of Bribes

This is a separate motion by plaintiff seeking to obtain more information from third parties regarding the alleged $30,000,00 bribe. Plaintiff issued three subpoenas, two to Merrill Lynch and one to BB&T Bank, seeking copies of certain checks paid by or to defendant. Merrill Lynch has responded to the first subpoena, but has refused to respond to the second one, as has BB&T Bank, based on defendant's informing the [ Page 4]

third parties that it had filed a motion to quash the subpoenas. Plaintiff has asked that we enforce them.

The record is rather hazy on the chain of events surrounding the issuance of the subpoenas. The return date on the first subpoenas was June 4, 2003. Defendant sent a letter to Merrill Lynch dated June 2, 2003 requesting that Merrill Lynch not respond to the subpoena because of a pending motion to quash. Plaintiff alleges that the letter was not actually sent until July 2, 2003; defendant produces a FedEx tracking statement showing that something was delivered to Merrill Lynch on June 4, 2003. In any event, Merrill Lynch responded to the first subpoena prior to receipt of the letter from defendant. Defendant also contends that it did not receive timely notice of the subpoenas, but plaintiff attaches a notice showing that it sent copies to defendant's counsel (including local counsel) on May 21, 2003.

Defendant makes a general allegation that the subpoenas are improper because timely notice was not given to third parties whose financial records were being sought. It is true that Mike Nance, an individual whose checks to or from defendant were subpoenaed, filed a motion to quash the subpoena on July 7, 2003. The motion has never been noticed for hearing and we have no other evidence regarding the alleged impropriety of the subpoenas. Thus, we will enforce the subpoenas issued to Merrill Lynch and BB&T Bank, except to the ...

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