Confidentiality Clubs

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We continue our coverage of English Confidentiality Protections in Trade Secret and IP Cases by exploring a recent decision involving access of party experts to confidential information and trade secrets as part of confidentiality rings.

In Infederation Limited v Google LLC & Ors [2020] EWHC 657 (Ch), Infederation Limited a/k/a Foundem – a provider of online shopping comparison services – brought a case against Google alleging Google’s search result algorithms purportedly reduced its “ranking” in violation of competition law. The parties agreed to three confidentiality rings: (1) a top “confidential” ring including the founding members of Foundem, external solicitors, counsel, and economic experts; (2) an external solicitors, counsel, and economic experts ring (the legal eyes only or “LEO” ring); and (3) a further restricted “RLEO” ring, which was 10 named external solicitors and counsel. Google made an application to strike some of Foundem’s claims in part relying on evidence related to search algorithms designated as confidential, LEO, or RLEO. In order to review and evaluate these specially designated exhibits, Foundem requested that its search engine optimization (“SEO”) expert Mr. Klöckner, who was already part of the outer confidentiality ring, be added to the LEO and RLEO rings. Google pushed back, claiming that how it ranks search results should be kept confidential or its value would be lost and that it was unlikely that Mr. Klöckner could keep the knowledge he gained from his role in the proceedings separated from his independent work as an SEO consultant. Infederation Limited v Google LLC & Ors [2020] EWHC 657 (Ch) [24-26].
Continue Reading English Trade Secrets Proceedings: Experts May Be Permitted Access to Information In Confidentiality Rings

After posts considering confidentiality protections under the EU Trade Secrets Directive 2016/943 when litigating in various jurisdictions, we next turn to how these issues arise in the context of arbitration.

Where trade secrets are protected by a contract, an opportunity arises for parties to consider alternative dispute resolution mechanisms including arbitration and whether to adopt express rules in arbitration that protect confidentiality.
Continue Reading Confidentiality of Trade Secrets in Arbitration

In our next post on the EU Trade Secrets Directive 2016/943, we turn to the Netherlands. In the Netherlands, the EU Trade Secrets Directive was implemented in 2018 by the Act on the Protection of Trade Secrets (Wet bescherming bedrijfsgeheimen) and led to amendments to Dutch procedural law including those related to confidentiality clubs. For example, access to alleged trade secrets introduced in proceedings is granted to at least one person of the opposing party and that party’s lawyer under confidentiality restrictions. (Article 1019ib, Dutch Code of Civil Procedure). Depending on the nature of the trade secret, however, the court may order that access to certain documents be limited to only a lawyer or another authorized representative but not a representative of the opposing party. (Article 22a(3), Dutch Code of Civil Procedure).
Continue Reading The Expansion of Confidentiality Protections in Trade Secret and IP Cases in the Netherlands and Belgium

The EU Trade Secrets Directive 2016/943 contains a variety of confidentiality protections expressly protecting the publicity of the proceedings because “[t]he prospect of losing the confidentiality of a trade secret in the course of legal proceedings often deters legitimate trade secret holders from instituting legal proceedings to defend their trade secrets, thus jeopardising the effectiveness of the measures, procedures and remedies provided for.  For this reason, it is necessary to establish, subject to appropriate safeguards ensuring the right to an effective remedy and to a fair trial, specific requirements aimed at protecting the confidentiality of the litigated trade secret in the course of legal proceedings instituted for its defence.”  Article 9 of the Directive specifically required EU member states to implement rules creating such protections, such as by restricting access to hearings and creating so-called “confidentiality rings” or “confidentiality clubs” limiting the dissemination of confidential information and documents to designated persons.

The United Kingdom’s implementing law, the Trade Secrets (Enforcement, etc.) Regulations 2018, requires that the court have the power to restrict access to documents containing alleged trade secrets and to hearings. s. 10(5).  There is already significant maturity in the kinds of confidentiality protections available in English litigation so this is unlikely to lead to significant change.  Although the principle of open justice is a fundamental feature of the legal system and departures are permitted only if necessary in the interests of justice, exceptions and restrictions to openness and respect for confidentiality are actually already well-established in the United Kingdom. See McKillen v Misland (Cyprus) Investments Ltd and others [2012] EWHC 1158 (Ch).
Continue Reading English Confidentiality Protections in Trade Secret and IP Cases