What approach is the UPC taking to the protection of trade secrets and other confidential information?

In 10 x Genomics v Curio, the Court appears to set out what it regards as a standard approach to R.262A applications for the protection of confidential information. The judgment relates to an application filed by the Defendant (Curio) for the protection of confidential information that was purely commercial in nature as part of proceedings for interim measures. Curio argued that since the information was purely commercial and non-technical in nature, patent attorneys would not require access to the information. They also argued that the information was specific, highly commercially sensitive and of such a nature that the employees of 10 X Genomics did not need access to it.

By order dated 11 March 2024, the Düsseldorf Local Division limited disclosure to four legal representatives, two legal assistants and one employee of the Claimants, which was a much broader group than the application sought. The Court held that patent attorneys did not need access to the information, but upheld the requirement of R.262A.6 that access should be granted to "at least one natural person from each party".

(*2): See the Order dated 11 March 2024 by the Düsseldorf Local Division in 10 X Genomics v Curio, APP_8500/2024 related to the main proceedings ACT_590953/2023, UPC_CFI_463/2023

The Düsseldorf Local Division shed more light on the considerations where there is a risk of use of the confidential information in patent prosecution strategy and strategic decisions in Fujifilm v Kodak. The Defendants (Kodak) submitted an application for the protection of confidential information under R.262A in relation to information in their statement of defence (in particular certain business figures and information on their R&D process) that they alleged was confidential. The Defendants put forward this information to support a non-infringement argument relating to prior use of the invention under Art. 28 UPC. The dispute therefore centred on an alleged patent infringement, as opposed to use or disclosure of a trade secret.
The Defendants requested that access to this information was limited to the Claimant's legal representative and a maximum of three employees of the Claimant, who should not be involved in R&D, pricing or any other competitive decision making and should not be involved in prosecution of patent applications for a period of 5 years after the end of proceedings. The Claimant's position was that the information was not confidential in nature and that the restriction to three employees was not justifiable on the facts of the case. They also argued that the restrictions to be imposed on the Claimant's employees were disproportionate.

In reaching its decision, the Düsseldorf Local Division weighed up the right of a party to have unlimited access to the documents contained in the file, which guarantees its fundamental right to be heard, against the interest of the opposing party to have its confidential information protected. It emphasised that these fundamental principles have to be balanced against each other based on the facts of the particular case. The Court held that the Defendants had adequately explained why the information in question was confidential and that its interest in having this information protected therefore outweighed the right of the Claimant to have full and unlimited access to the information in question.

The Court also had to decide on what level of access to the information the Claimant should be granted in order to exercise its right to be heard. It emphasised that R. 262A.6 establishes that at least one natural person from each party and the respective lawyers or other representatives should be granted access in order to ensure a fair trial and commented that this provision reflected the spirit of the trade secret directive. The Court disregarded arguments put forward by the Defendant referring to deviating national practice in the Netherlands allowing for attorneys' eyes-only confidentiality clubs on the basis of the Dutch Code of Civil Procedure and stated that such arguments were bound to fail as this procedural law is inapplicable in the UPC and counter to the sources of law to be respected by the UPC as construed by the panel.

The Court granted access to the information concerned to three of the Claimants' employees on an immediate basis, but decided not to grant access to a further six persons named by the Claimant until the time period for bringing an appeal and an appropriate time period to bring an application for suspensive effect before the Court of Appeal had elapsed. It rejected the Defendants' request for restrictions on these employees.

*See the Order dated 27 March 2024 by the Düsseldorf Local Division in Fujifilm v Kodak, APP_6761/2024 related to the main proceedings ACT_578607/2023, UPC_CFI_255/2023

The Local Division decisions continued in a similar vein in Dish v Sling, where the Defendants filed an application for the protection of confidential information in relation to information contained in their statement of defence. In its order of 3 July 2024, the Mannheim Local Division held that particular information in this document should be classified as confidential and that access should be granted to the Claimants' counsel, external experts and three specified employees of the Claimants.

The Defendants appealed against the order, arguing that the three specified individuals of the Claimants should not be granted access to the information (and that access should be limited to the Claimant's counsel only) due to involvement of the individuals concerned in strategic decisions in parallel US proceedings. The Mannheim local division considered the request to limit access unsubstantiated. It concluded that the Defendants did not sufficiently demonstrate the unreliability of the designated individuals, noting that the named persons were all representatives of the US Patent and Trademark Office and therefore experienced in handling confidential information. The Court also emphasised that these individuals needed access to the confidential information to enable proper prosecution of the UPC proceedings. The Defendants' application for review of the order was therefore dismissed.

*See the Order dated 22 July 2024 (Order no. ORD_42880/2024) by the Mannheim Local Division in Dish and Sling TV v Aylo, APP_40530/2024 related to the main proceedings ACT_594191/2023, UPC_CFI_471/2023

In Dolby and Access Advance v HP, the Düsseldorf Local division addressed the question of whether a confidentiality club can extend to an intervener in proceedings. The dispute related to a claim against the Defendants for infringement of a European bundle patent that the Claimant had contributed to a patent pool managed by Access Advance.

The Defendants filed an application for the protection of confidential licensing negotiation details under R.262A. The Claimant's position was that the Defendants' request should only be granted if Access Advance was included in the group of authorised and obligated recipients. The Defendants objected to the inclusion of Access Advance on the grounds that the prerequisite for granting such access was the participation of the person concerned in the proceedings.

Access Advance then intervened in the proceedings by letter dated 20 June 2024. The Defendants continued to object to the inclusion of Access Advance in the group of authorised recipients, arguing that the content of the bilateral licence negotiations between the parties was subject to a strict confidentiality agreement and in view of the fact that Access Advance's legal representatives had not even requested access to this information, there was no need to grant access.

The Court approved the Defendants' request for a confidentiality club and limited access to the information concerned to selected individuals from each party. However, the court rejected the Defendants' argument to exclude Access Advance’s employees from the confidentiality club commenting that such a complete exclusion could not be "reconciled with the role of the intervener in proceedings". Access Advance (as intervener) was granted the same level of access to the confidential information as the parties to the dispute.

*See the Order dated 22 July 2024 by the Düsseldorf Local Division in Dolby and Access Advance v HP, APP_25609/2024 related to the main proceedings ACT_590145/2023, UPC_CFI_457/2023

In Plant-e v Arkyne, the Hague Local Division addressed the permissibility of "Outside Attorneys' Eyes Only" regimes. The Claimants made an R.262A application, requesting that certain information relating to investments made by their investors should be treated as confidential. The Defendant's ("Bioo's") position was that the application should be dismissed, however if granted, the parties' representatives agreed to establish an "Outside Attorneys' Eyes Only", which would exclude Bioo's natural persons from the confidentiality club. The Court held that the information concerned did qualify as confidential information and consented to the proposed "Outside Attorney's Eyes Only" regime.

The Judge-Rapporteur commented that it was not entirely clear whether denying access to at all natural persons in a party was in line with the legal framework since it was not clear whether R.262A.6 always applied or if the wording of Article 58 UPCA meant access to confidential information could be prohibited completely. In particular, he commented that the wording of R.262A.1 together with Article 58 seems to allow for a reading that, in addition to limiting access to specific persons, it is also possible in proceedings before the UPC to rule that access to ‘confidential information’ (which is defined more broadly than trade secrets in Art. 58 UPCA as “trade secrets, personal data or other confidential information of a party”) be prohibited completely. This follows from the use of the wording in R.262A,1 “restricted or prohibited or (…) restricted to specific persons” (emphasis added). In the Order, the Judge-Rapporteur considered the interpretation of the Trade Secrets Directive in different Contracting Member States, noting that in Germany and Belgium, the provisions of the Directive have been extended to apply to all types of cases in which confidential information is concerned, whereas in the Netherlands, the Directive is only applied in cases relating to trade secrets and different provisions are applied to other types of cases such as patent proceedings. The Judge-Rapporteur concluded that even if R.262A.6 did apply to this situation, it is possible to derogate from it by agreement.

*See the Order dated 4 March 2024 by the Hague Local Division in Plant-e v Arkyne, APP_589842/2023 related to the main proceedings ACT_549536/2023, UPC_CFI_239/2023

The question of "Outside Attorney's Eyes Only" was raised again in the Local Division Paris. The Court asked the parties to propose members of a confidentiality club to examine information gathered in a Saisie. Both parties only proposed external legal advisors as members of the club. When asked by the Judge Rapporteur, the parties confirmed their agreement with the respective proposals and that they were content to exclude natural persons. The Court agreed with the parties' proposals and held that in spite of the wording of R.262A.6 it possible to have an "Outside Attorney's Eyes Only" club by mutual agreement of the parties provided the principle of a fair trial was not affected.

*See the Order dated 26 March 2024 (Order No. ORD_12088/2024) by the Paris Local Division in C-Kore v Novawell, APP_583867/2023 and APP_592899/2023 related to the main proceedings UPC_CFI_397/2023

The use of an "Outside Attorney's Eyes Only" regime by agreement is cemented in 10x Genomics v Vizgen. Here, the Claimants requested an order requiring that a licence agreement and various further agreements relating to it be treated as confidential since the information contained in these documents were trade and business secrets of the Claimants. They requested that the confidential information should be restricted to "Outside Attorney's Eyes Only", i.e. that it should only be made available to the Defendant's authorised representatives. In particular, they argued that these documents were disclosed with an "Outside Attorney's Eyes Only" restriction as part of the discovery accompanying the parallel proceedings before the U.S. District Court due to the protective order agreed between the parties. The Claimants highlighted that the parties had agreed with the competent US Court that if the Defendant requested production of documents that were part of the protective order for use in the UPC proceedings, confidentiality protection would be obtained and access to the documents would be restricted to "Outside Attorneys' Eyes Only". The Defendant argued that the present case was not one in which the Court should exclude access to the documents by at least one natural person by way of exception, since agreement between the parties did not exist with regard to the documents concerned. They argued such agreement was not prompted by the US proceedings. The Court held that the Claimants were justified with regards to their request for confidentiality and that the circumstances presented by the Claimants did indicate agreement between the parties, therefore access to the documents should be restricted to "Outside Attorney's Eyes Only".