Carlson Pet Products, Inc. v. North States Industries, Inc.

Background

Carlson Pet Products, Inc. alleged that North States Industries, Inc. sold pet gate products infringing two Carlson patents. After a pretrial conference, the parties agreed on nearly all terms of a proposed protective order but asked the court to decide two remaining issues:

1. Whether the order should allow North States executives Dean Weisbeck and Julie Yager Grad to access information designated “Confidential,” or restrict that information to lawyers; and 2. Whether the order should include the patent-prosecution bar proposed by North States.

The proposed protective order used three confidentiality levels: “Confidential,” “Confidential–Attorneys’ Eyes Only,” and “Confidential–Attorneys’ Eyes Only Prosecution Bar.” The two more restrictive levels could not be viewed by non-lawyers, while the “Confidential” level could be disclosed to specified non-lawyer employees.

Access to Confidential Information

Carlson argued that no North States non-lawyer personnel should be allowed to review Carlson’s confidential information. The court rejected that request. It found that the multi-level system was appropriate for the case and would protect competitively sensitive information while allowing less sensitive confidential information to be reviewed by the two identified North States employees. The court also noted that the most restrictive level could be used for information that should not be available to non-lawyer personnel.

The court ordered that the protective order adopt Paragraphs 3 and 4 of North States’s proposal. It directed Carlson’s counsel, within seven days, to provide the names of Carlson non-lawyer employees who could receive information designated “Confidential” by North States.

Patent-Prosecution Bar

A patent-prosecution bar restricts certain lawyers or other people who receive sensitive litigation information from working on patent applications or related patent matters. North States argued that the bar was needed because Carlson’s litigation lawyers, Bryon Wasserman and Frederick Tecce, also advised Carlson on patent prosecution. Carlson argued that the proposed bar was unnecessary and too broad, including because it would last three years after the litigation and would restrict high-level patent-prosecution advice.

The court held that a prosecution bar was appropriate but that North States’s proposal needed limits. It found that Wasserman and Tecce were involved in “competitive decision-making” because they provided strategic advice about patent prosecution, claim scope, and strategy. The court also found that the case was likely to involve technical and design information about North States’s unreleased or potential future products. That information could be relevant to North States’s defense against Carlson’s lost-profit damages claim and could create a risk of inadvertent use in patent prosecution.

The court agreed with Carlson in part that the proposed language concerning “market studies” was too broad. General market evaluations, predictions about consumer interests, and possible price-point analyses were not ordinarily relevant to preparing patent applications. The court therefore directed that information covered by the prosecution bar must specifically refer to the technical specifications or the design and development of unreleased or potential future products. General market studies not tied to that information would not qualify merely because they were commercially sensitive.

Scope and Duration

The court found the proposed scope of prohibited activities appropriate. The bar could restrict covered competitive decision-makers from preparing or filing new patent applications, providing patent-prosecution advice before the United States Patent and Trademark Office or foreign patent offices, and engaging in activities such as invention evaluation, application preparation, claim drafting, amendments, reexamination, reissue, and related consultation. The court also found that the covered subject matter—patent applications relating to pet gates, pet enclosures, or child safety gates, including the patents at issue—was properly tailored to the litigation.

The court found the proposed three-year duration too long. It concluded that the bar should last one year from entry of a final judgment in the district court, rather than three years after the end of the action and any appeals.

Disposition

The court ordered that Carlson’s request to deny all North States non-lawyer employees access to information marked “Confidential” was DENIED. It ordered that North States’s request for a protective order containing a patent-prosecution bar was GRANTED, subject to the modifications described in the order. The court stated that it would separately issue a protective order tracking those modifications.

The opinion is signed by Katherine Menendez, United States Magistrate Judge.