TECHNICAL EXPERTISE IN DISPUTES ON CONFIDENTIAL INFORMATION

TECHNICAL EXPERTISE IN DISPUTES ON CONFIDENTIAL INFORMATION

Is common knowledge that the official technical expertise has a fundamental role in the lawsuits concerning intellectual property rights, supplying to the court trying the case the required technical support on which the grounds of the decisions to be issued should be based.

The official technical expertise is not always requested by the party to enforce his rights or to establish the lack of interference with the rights of another party. Sometimes the expertise is requested to substantiate a groundless right, in order to block the entry of a potential competitor into the market, a practice currently referred to as abusive exercise of a right.

A very interesting case in which our firm had a prominent role as ex-parte technical experts is indeed a unsuccessful attempt of a company to stop a potential competitor (the latter assisted by our firm as ex-parte technical experts) through a lawsuit
for violation of confidential information (Art. 98 of the Industrial Property Code) and unfair competition (Art. 2598 of Civil Code), which however took five full years to reach the decision, that was not appealed by the parties.

The field of the dispute is the chemicopharmaceutical sector, more particularly the suppliers and subordinate suppliers, namely
companies supplying to the pharmaceutical enterprises the active substances prepared in the desired administration form (tablets, granules, capsules, vials, syrups) to be then filled in the packages to be put on the market.

Company (A) assisted by our firm had produced special microgranules of an active substance difficult to be used in view of swallowing and taste problems of the granules available on the market, and offered them to a company (B) manufacturer of this preparation for use in a corresponding product, submitting samples and the complete records of the production steps and tests
of the performances. Some weeks after, company (B) declared not to be interested in the offer and consequently company (A) offered the same product to another company that accepted said offer.

Company (B) was informed about this fact and filed with the court a request for judicial search charging company (A) of breach of confidential information. The request was granted and the appointed expert witness went to two plants of company (A) collecting in bulk a great number of documents which were closed in sealed covers and kept in the Court Clerk’s office.

At this point it has to be pointed out that in company (A) some former employees of company (B) were working, and the latter company (B) already used company (A) to get supplies of some ingredients manufactured by company (A) and needed by company (B) for some preparations, and the contacts, even of personal nature between the employees of the two companies were regular and constant.

The so conducted search was followed by the mentioned writ, in which two employees of company (B) were also summoned and meanwhile dismissed with the charge of having passed to company (A) confidential information, and the inevitable consequence was the appointment of another expert witness, who was ordered to answer a double question: (1) if the technical documents produced by company (B) accompanying the summons writ, met the requirements of Art. 98 of the Industrial Property Code to be protected; and (2) if the documents of company (A) kept in the sealed covers contained matter included in the technical documents produced by company (B). The sealed covers were delivered to the expert witness with the duty of secrecy of all the delivered documents, that could be inspected only by the exparte experts and the lawyers of the parties, who
were requested to sign a confidentiality undertaking even against their clients.

The expertise proceedings caused many joint meetings to open all the covers, list their contents and exclude all the documents which were unanimously considered not relevant, as well as the exchange of four technical statements of both parties, wherein we refuted point by point the alleged assertions of company (B). The conclusion drawn by the expert witness was that the
documents produced by company (B) might contain subject matter eligible for protection under Art. 98, but the documents of company (A) contained in the sealed covers did not allow to ascertain interference with those of company (B), since said documents were vague and incomplete.

Therefore the judge, upon request of company (B), ordered a supplemental technical expertise, instructing the expert witness (a wellknown and established patent attorney) to check systematically all the documents that might be found at both plants of company (A), in presence of the ex-parte technical experts and the lawyers. This was another laborious work, taking two additional full-time days of a real thorough search of the premises of company (A), during which the lawyers of company (B) even went so far as to declare that the machinery and equipment as well as the arrangement of the rooms followed closely the
configuration of the premises of their clients!

The conclusion of this supplemental technical expertise, again after repeated exchange of statements of the parties, wherein we again proved the non-existence of any imitation by company (A) of the formulations produced by company (B), was that the expert witness did not find any similarity between the compared documents, and this outcome was recorded in the following decision, which stated also that the conduct of both employees of company (B) unjustly dismissed (and indeed reinstated in their job) did not show any indication in this connection, and moreover that company (B) had not given any direct or indirect evidence of an actual transfer of confidential information from company (B) to company (A).

The only criticism raised to company (A) was to have elaborated a revision of the Company Selfcontrol Manual of company (B), courteously transmitted by one of the above mentioned employees to one of their former employees working in company (A), as an example to be followed for its compilation, whose contents however was considered by the expert witness as not fulfilling the secrecy requirements pursuant to Art. 98, and only in respect of this breach he considered proved the violation by company (A) of Art. 2598 Civil Code (unfair competition), that the court however defined in the grounds of the decision “a little impropriety related to events by now finally historicized”.

This complex case shows that the production of heaps of documents and the assistance of well-known and established lawyers,
might not be sufficient to prevail in connection with unwarranted claims of important enterprises against smaller companies.

Published in Italia Oggi annual review curated by Marino Longoni and realized by Convey S.r.l.