HotSpot Therapeutics, Inc. v. Nurix Therapeutics, Inc.

Background

HotSpot filed an action seeking declarations that it had not misappropriated trade secrets under the federal Defend Trade Secrets Act or the California Uniform Trade Secrets Act and had not breached a contract. Nurix filed counterclaims for trade-secret misappropriation under both statutes, breach of contract, and intentional interference with performance of a contract.

Nurix alleged that it had shared confidential and trade-secret information with Macroceutics, Inc. during a collaboration. HotSpot later acquired Macroceutics, and Nurix alleged that HotSpot used the information to design or build DNA-encoded libraries. Nurix served a disclosure identifying its asserted trade secrets under California Code of Civil Procedure section 2019.210. That statute requires a party alleging trade-secret misappropriation to identify the trade secret with reasonable particularity before beginning discovery concerning it.

Motion to Stay Discovery

HotSpot argued that Nurix’s disclosure was too vague. The court reviewed the challenged descriptions—trade secrets 1(b), 2(a), 3, 4, and 5(c)—and found them impermissibly vague. In the court’s view, several descriptions identified broad subject matter, undefined “solutions,” examples, or non-limiting document lists rather than the actual information claimed as trade secrets. The disclosure therefore did not give HotSpot enough information to determine the boundaries of the alleged secrets.

The court declined to stay all discovery. It allowed discovery on Nurix’s intentional-interference claim because the court had previously determined that claim stood independently of the trade-secret claims. It also allowed discovery on portions of the breach-of-contract claim that did not depend on alleged trade-secret misappropriation. The court stayed discovery on Nurix’s federal and California trade-secret claims and on the portions of the contract claim that depended on trade-secret misappropriation. It rejected Nurix’s argument that discovery should proceed concerning trade secrets that were adequately described, stating that Nurix had not cited authority supporting that narrower approach.

The court granted in part and denied in part HotSpot’s motion to stay discovery. It ordered Nurix to serve a statement identifying the trade secrets at issue within 21 days of the order.

Motion to Strike

HotSpot asked the court to strike portions of Nurix’s opposition and supporting declaration, arguing that they improperly disclosed confidential mediation-related discussions. The court found that the challenged statements largely concerned an ongoing discovery dispute and did not impermissibly disclose mediation conduct or communications. It also found no relevant prejudice because it did not rely on the statements to resolve the motion to stay. The court denied HotSpot’s motion to strike.

Motions to Seal

The court found good cause to seal material describing the parties’ agreement, confidential mediation communications, and Nurix’s alleged trade secrets. It granted HotSpot’s motion to seal portions of its motion to stay, Nurix’s opposition to that motion, HotSpot’s reply, and Nurix’s opposition to the motion to strike. It granted in part and denied in part HotSpot’s motion to seal its motion to strike and supporting declaration: some highlighted portions and an exhibit remained sealed, while other portions had to be filed publicly in redacted form within seven days. Judge Hixson denied HotSpot’s motion to strike, granted in part and denied in part the specified sealing motion, granted the other listed sealing motions, and granted in part and denied in part the motion to stay discovery.