CARPENETI, Chief Justice.
A quasi-independent governmental agency manages a program designed to improve power generation in small Alaska villages that are located off the electrical grid. One such village believed that the agency did not respect the wishes of village leaders in securing a contract to improve that village's power-generation facility. The village, joined by a company that produces a key component used in improving power generation in village areas, sued the agency. The plaintiffs alleged that the agency erroneously awarded contracts for power generation and that agency employees improperly disclosed the company's trade secrets to its competitor. The superior court dismissed all of the plaintiffs' claims on motions for summary judgment. Because we agree there are no disputed issues of material fact and the defendants are entitled to judgment as a matter of law, we affirm the decision of the superior court in all respects.
The present appeal concerns many of the same underlying facts as Powercorp Alaska, LLC v. State, Alaska Industrial Development & Export Authority, Alaska Energy Authority (Powercorp I)
Powercorp Alaska, LLC and Controlled Power, Inc. both develop and build automatic paralleling switchgear technologies. A key component of automatic paralleling switchgear is a supervisory controller, which responds to data sent by various sensors. The supervisory controller sends instructions to engine controllers, which, in turn, adjust power generators to optimum operating speed. The supervisory controller bases its "instructions" on data received from the sensors and pre-programmed parameters. The industry standard for supervisory controllers is a "programmable logic controller" (PLC). Controlled Power has used this piece of equipment in at least two RPSU projects. By contrast, Powercorp's supervisory controller "relies on a personal computer rather than a PLC to derive the commands sent to the engine controllers." Powercorp and Controlled Power both have tried to secure, and sometimes have secured, contracts with the Energy Authority to install switchgear as part of the RPSU program.
Powercorp asserts that a key component of its switchgear system is an engine controller manufactured "under license" by Woodward, a company that makes control equipment. This piece of technology, known as a GSS controller, receives instructions from the supervisory controller and passes them on to the power generators. The record suggests that the GSS controller is similar to the GCP-30 series controller, which is manufactured by Woodward and sold throughout the world. In response to a discovery request, Powercorp denied that the "`Woodward engine controller, prepared as a licensed product by Woodward to Powercorp' ... is identical to a Woodward engine controller that is available in the open market, except that it has a Powercorp faceplate." Controlled Power seems to have accepted this denial (at least for purposes of argument), describing the product Powercorp licensed from Woodward as having "the same features as the [GCP-]31 and [GCP-]32, but [with] more whistles and bells." Powercorp contends that its "use of the Woodward GCP was much more extensive than any other control system designer or manufacturer, who used it to control just one engine." Powercorp asserts that it has developed special software programs to expand the capabilities of the Woodward engine controller. It is not clear how many people — within Powercorp or Woodward — are familiar with the special capabilities of the GSS controller or the technical details of its development.
Powercorp alleges that it sent the Energy Authority a confidentiality agreement on January 10, 2003. This agreement had not been signed by March 2003, when Powercorp engineer Juergen Zimmerman met with Energy Authority employee Kris Noonan. At this meeting, Zimmerman explained how the Woodward GCP Engine Controller could be added to the Energy Authority system. In a document entitled "affidavit" but which was not notarized, Zimmerman stated that he demonstrated to Noonan how and where to wire the engine controller by drawing on a wiring diagram that Noonan provided. Powercorp alleges that this information was disclosed to Noonan with the understanding that it would not be communicated to others outside the Energy Authority.
The Energy Authority admits that in the spring of 2003, Noonan discussed technical functions of the Powercorp system with Zimmerman, as part of what Noonan perceived to be a Powercorp "sales pitch." The Energy Authority states that "Mr. Noonan gave Mr. Zimmerman drawings of a switchgear system that had been designed by [the Energy Authority], built by Controlled Power, and installed by [the Energy Authority] in Tuluksak in order for Powercorp to consider whether, and to show [the Energy Authority] how, Powercorp could provide a system meeting this design." In a later affidavit, Noonan states, "[Zimmerman's] drawing may have included the Woodward controller, but it was not of interest or concern to me how to wire the Woodward GCP controller or any other Woodward controllers into [the Energy Authority's] system — since [the Energy Authority] was very familiar with Woodward controllers and this information was available from Woodward." In the same affidavit, Noonan denies the allegation that Zimmerman showed Noonan "how to wire the Woodward GCP Engine Controller into a schematic drawing of the [the Energy Authority's] current system" and denies asking Zimmerman to do so.
In November 2003, the Energy Authority approved a waiver for alternative procurement methods. This waiver authorized the Energy Authority to award sole-source (non-competitive) contracts for two RPSU program sites: Stevens Village and Golovin. Through this non-competitive process, Powercorp and Controlled Power were each awarded a contract to design and build fully automatic switchgear for one of the villages. Powercorp alleges that the sole-source procurement of the Controlled Power system was part of a plan to position Controlled Power to obtain other RPSU contracts.
The Energy Authority justified the sole-source procurement on the ground that it would allow the Energy Authority to compare and evaluate different switchgear systems.
While installation at the demonstration sites was underway, the Energy Authority arranged installation of switchgear at other villages. In 2004, the Energy Authority solicited bids for the installation of automatic switchgear systems in eight villages: Arctic Village, Hughes, Kongiganak, Koyukuk, Kwigillingok, Manokotak, Nikolski, and Pedro Bay. The Energy Authority solicited bids through a competitive process, issuing ITB [invitation to bid] No. REG-04-230. The winning bidder would contract to install switchgear in all eight villages.
Bid specifications for ITB REG 04-230 were developed by engineering consultant Brian Gray. The Energy Authority states that specifications are developed through an "iterative" process. The parties agree that the REG 04-230 specifications were based, in part, on the specifications used for the Stevens Village switchgear installation. The specifications required use of an Allen-Bradley PLC supervisory controller and Woodward GCP-31 engine controller. Powercorp asserts that this bid specification disclosed to Controlled Power key information that Noonan had learned about the Woodward component and how to connect it. Controlled Power asserts that it had used a Woodward GCP-30 series engine controller in its switchgear systems as early as 2001. The Energy
As the only responsive bidder, Controlled Power was awarded the eight-village switchgear-installation contract described in ITB REG 04-230. Powercorp did not submit a bid; it had "no intention" to submit a bid using PLC technology.
The Native Village of Kwigillingok (Kwigillingok) is one of the villages covered by the REG 04-230 invitation to bid. In June of 2002, representatives of the Energy Authority and Kwigillingok signed a grant agreement concerning the Kwigillingok Power Plant Upgrade Project. The agreement designates Kwigillingok as the grantee and the Energy Authority as both the grantor and the grantee's agent.
The agreement provided that upon receipt of funds from the Denali Commission, the Energy Authority would grant Kwigillingok "funds for the construction of the Project and performance of the Project work under the terms outlined in this agreement." The original agreement provided that the Energy Authority would "grant funds to pay for expenses incurred by the Grantee that are authorized under this Agreement, in an amount not to exceed $210,000" and that performance would be completed "no later than December 31, 2003." These terms appear to have been amended, as the project took more time and became more expensive than the parties first expected. Performance deadlines were extended until the end of 2005. It appears that the Denali Commission agreed to contribute over $258,000 for the project.
The grant agreement assigned the Energy Authority primary responsibility for managing the project:
The parties disagree about the nature of the duties the Energy Authority owed to Kwigillingok under this agreement. The complaint asserted that the Energy Authority administers federal Denali Commission funds "under a trustee relationship for the benefit of ... rural Alaska villages," including Kwigillingok. The Energy Authority rejects this characterization.
The agreement assigns the grantee responsibility for other aspects of the project, including securing permits and real property for the power generation site and serving as a liaison between the Energy Authority and the local community. The parties agree that the grantee Kwigillingok is responsible for
As the only responsive bidder, Controlled Power was awarded the eight-village switchgear-installation contract that covered Kwigillingok.
William Igkurak, Kwigillingok's facilities director, sent two letters to the Energy Authority expressing his disapproval of the decision to award the contract to Controlled Power and his desire to have a "wind-ready" Powercorp switchgear system installed. The first letter was sent on October 5, 2004, and the second letter was sent on November 9, 2004. Mike Harper, the Energy Authority's deputy director, responded to each letter within ten days. Harper's first letter stated that the switchgear-installation contract with Controlled Power could be cancelled under certain circumstances (i.e. if cancellation was in the best interests of the Energy Authority); that if the Kwigillingok portion of the contract were canceled, the Energy Authority would be liable for approximately $12,000 in terminations costs; and that cancellation of the contract would not guarantee installation of the Powercorp system because procurement would be governed by federal purchasing rules.
Igkurak's second letter stated, "We would like to place an immediate hold on the Controlled Power control system, and proceed immediately with the procurement process to substitute a Powercorp wind-ready system." Harper's reply stated that "[t]he regulations do not allow [the Energy Authority] to enter into a sole-source (non-competitively procured) contract with Powercorp," and that "[i]f the Native Village of Kwigillingok is willing to pay all increased costs, the President or other authorized representative of the Native Village of Kwigillingok (Grantee) should send us a letter that so indicates." Al Ewing, a representative of the Denali Commission who was copied on Mr. Igkurak's letters, sent a response on November 22, 2004. Ewing wrote that he "cannot support the alteration or amendment of any portion of the financial assistance award for [Kwigillingok's] power system upgrade. If the Native Village of Kwigillingok is determined to alter the project, it must be prepared to accept responsibility for any additional costs incurred...." The Energy Authority asserts that Kwig Power Company (Kwig Power), a division of the Native Village of Kwigillingok, did not respond to Harper's second letter or Ewing's letter; Kwig Power does not deny this.
In the next stage of RPSU implementation, the Energy Authority invited bids for the installation of switchgear in five more villages: Chuathbaluk, Crooked Creek, Sleetmute, Stony River, and Takotna. This invitation to bid was labeled ITB No. REG 05-067; it was not considered in Powercorp I. The REG 05-067 solicitation was based in part on the REG 04-230 invitation to bid;
The Energy Authority and Powercorp interpreted this language differently. Before the bidding period opened, Powercorp filed a protest with the Energy Authority. When the protest was denied, Powercorp appealed and sought an administrative hearing. The hearing officer explained:
Powercorp also argued that it should not have been required to submit a bid on Option No. 1 in order to submit a bid on Option No. 2. The Energy Authority argued that a bid on Option No. 1 was required "in order to ensure that bidders fully understand our system requirements and provide a system that offers similar performance and has similar layout and construction." The hearing officer dismissed Powercorp's argument as moot because Powercorp had not shown that, but for the Option 1 requirement, it would have been the successful bidder.
Powercorp also argued that the Energy Authority had abused its discretion by issuing an invitation to bid, seeking competitive bids that met certain design standards, instead of issuing a request for proposals, seeking proposals that met performance criteria. The hearing officer concluded that AS 36.30.100 provides the Energy Authority with discretion to proceed with competitive bidding in this case and that the Authority had not abused its discretion.
The underlying facts of this case were in dispute as early as June 2004 when Powercorp protested ITB REG 04-230 invitation to bid. This case was initiated in superior court when Powercorp and Kwig Power alleged various civil claims against Controlled Power, the Energy Authority, Energy Authority Executive Director Ron Miller, Energy Authority employee Kris Noonan, and other defendants who are not parties to this appeal. An initial complaint was filed on August 11, 2006, identifying the defendants listed above and two plaintiffs, Powercorp and Harvey Paul, manager of the Puvurnak Power Company of Kongiganak. Kwig Power was not identified as a plaintiff in the original complaint, nor was the Native Village of Kwigillingok. On December 18, 2006, the First Amended Complaint was filed, listing the same defendants. The amended complaint listed Powercorp and Kwig Power Company as plaintiffs; it did not list Harvey Paul, the Puvurnak Power Company, or the village of Kongiganak as plaintiffs. On April 1, 2008, Powercorp and
In its Second Amended Complaint, Powercorp alleged that Kwig Power was damaged as a result of the Energy Authority's refusal to install the Powercorp control system (Count I). The complaint suggested that Kwig Power's damages consist of future "operation and maintenance costs," noting that "the Powercorp system ... had been shown to save up to 50% of the fuel costs when installed in [similar] towns...." Kwig Power also asserted claims against Noonan for working to exclude the Powercorp system from the Kwig Power procurement (Count III) and against Miller for failing to ensure compliance with procurement laws and competitive bidding (Counts VI, VII).
Powercorp asserted claims against Noonan for interference with prospective economic advantage and misappropriation of a Powercorp trade secret under AS 45.50.910 et seq. (Counts III, IV). Powercorp alleged that Controlled Power was liable for unjust enrichment as a result of the trade-secret misappropriation and liable for colluding with other defendants to inhibit competition (Counts V, VIII). Powercorp further alleged that it was also damaged as a result of Miller's "negligent failures to act" and Miller's improper decision to authorize sole-source procurement for the demonstration project awarded to Controlled Power (Counts VI, VII).
The Energy Authority, Noonan, and Miller submitted an answer that largely denied the plaintiffs' allegations and raised several affirmative defenses. Controlled Power filed a similar answer. The defendants later moved either for dismissal under Rule 12(b)(6) or for summary judgment.
On July 21, 2008, the superior court dismissed most of the claims against the Energy Authority, Noonan, and Miller. The claims against Controlled Power were dismissed in February 2009, following a hearing. The final claim, alleging trade-secret misappropriation by Noonan, was dismissed at a hearing in September 2009. Controlled Power and Noonan lodged proposed written findings and conclusions following the oral rulings in which the superior court dismissed claims against them; the court signed these orders in June 2009 and October 2009. In November 2009, the superior court entered final judgment.
During the course of this multi-year litigation, the superior court made a number of procedural rulings, which are addressed, as necessary, in Part IV.H.
Powercorp and Kwig Power appeal. Their appeal addresses the superior court's decision to dismiss their claims in addition to several rulings concerning discovery and timing.
Orders granting summary judgment are reviewed de novo.
There is no dispute that the facts underlying this case overlap significantly with the facts of Powercorp I. Issues resolved in prior litigation may limit the scope of questions
The Energy Authority, Miller, and Noonan urge us to apply collateral estoppel to affirm the superior court's dismissal of several claims. Powercorp and Kwig Power contend that the collateral estoppel doctrine does not resolve the present dispute. Collateral estoppel prohibits a party from re-litigating an issue of fact if the following four factors are met:
But we have recognized that it is not always possible to resolve a case through collateral estoppel, even if that case arises from the same underlying facts and theory as prior litigation.
The Energy Authority correctly argues that collateral estoppel can be asserted defensively. It does not matter if Noonan, Miller, or Controlled Power were not parties to Powercorp I. What matters is that Powercorp — "the party against whom the preclusion is employed" — was a party to the prior action.
But the other elements are less straightforward, and we agree with Powercorp that the appellees cannot satisfy all the elements of collateral estoppel. "One of the most difficult problems in the application of [collateral estoppel] is to delineate the issue on which litigation is, or is not, foreclosed by the prior judgment."
In Powercorp I, we considered "whether the Energy Authority showed `illegal favoritism' to Controlled Power ... by `working with it to design its system[,] then specifying it in the [REG 04-230] ITB.'"
In addition, the determinations in Powercorp I were not essential to a final judgment on the merits, as required by the third and fourth elements of the collateral estoppel doctrine. In Powercorp I, Powercorp waived the argument that the Energy Authority bore the burden of proof on its chosen method of procurement.
Because the application of absolute or qualified immunity could bar several of the appellants' claims,
The complaint in this case includes claims against Noonan for tortious interference with prospective economic advantage and misappropriation of a trade secret; it also includes claims against Miller for negligent supervision of Noonan and improper approval of sole-source procurement. Powercorp and Kwig Power argued in the superior court that approval of the sole-source procurement for the Stevens Village demonstration site helped position Controlled Power to obtain other contracts because it allowed the defendants to exchange information that was incorporated into the specifications for the next two switchgear-installation contracts (REG 04-230 and REG 05-670). According to the complaint, the invitations to bid for the next two contracts were "in effect" sole-source procurements directed to Controlled Power. Powercorp and Kwig Power have pointed to
Now we must determine whether absolute or qualified immunity applies to Miller's and Noonan's conduct. Qualified immunity shields government employees from liability if their actions are done in good faith without malice or corruption.
The Energy Authority and Noonan concede that Noonan is not entitled to absolute immunity,
To the extent that Powercorp and Kwig Power alleged bad faith on the part of Miller, that claim was unsupported by the record and consisted of mere accusations. They point to no record evidence that would support bad faith on Miller's part. As noted above, Powercorp did not respond at all on the immunity issue in its reply brief in this court. Kwig Power did address the issue, but, as to Miller, did no more than advance broad policy arguments concerning the interests of Alaska's villages in obtaining state-of-the-art control systems. Neither appellant claimed that the issue was not raised below or that our consideration of this alternative ground for affirmance — raised in detail by appellees the Energy Authority, Miller, and Noonan — would be unfair to them. Under these circumstances, we conclude that official immunity provides an alternative basis to uphold the superior court's dismissal of Counts VI and VII against Miller.
With respect to Noonan, the allegations of Powercorp and Kwig Power are more robust. They allege that Noonan engaged in "intentional wrongdoing" to advance his own "financial and career interests." They further suggest that Noonan, in bad faith, destroyed documents related to this litigation. Powercorp also alleges in its reply brief that Noonan "pressur[ed] or threaten[ed] Powercorp to induce it to sell or make available ... its control system." With respect to Noonan, the appellants have produced sufficient evidence of bad faith to survive summary judgment. Thus, we address the merits of the claims against Noonan — Counts III and IV — below.
Kwig Power alleges that it was harmed as a result of the Energy Authority's refusal to install the Powercorp control system. It suggests that damages consist of future "operation and maintenance costs" and that "the Powercorp system ... had been shown to save up to 50% of the fuel costs when installed in [similar] towns...." Kwig Power does not specify what kind of duty the Energy Authority allegedly breached, but its pleadings and briefing implicate several areas of law including contract obligations, tort duties, and fiduciary relationships.
The Energy Authority argues that Kwig Power's claim is barred by estoppel or waiver. It maintains that by not responding to the Energy Authority's letter of November 19, 2004, Kwig Power led the Energy Authority to believe that it would not protest the installation of the Controlled Power system and forfeited any claim to that effect. The Energy Authority further argues that even if Kwig Power had presented a viable breach of contract claim, it would be "barred because the Village of Kwigillingok breached its obligations under the grant agreement." The Energy Authority rejects Kwig Power's characterization of the Energy Authority as a trustee.
Waiver, or the intentional relinquishment of a known right, can be accomplished by an express statement or by conduct that is "inconsistent with any other intention than a waiver, or where neglect to insist upon the right results in prejudice to another party."
In this case, the grant agreement describes the Energy Authority as Kwig Power's "agent for the design and construction management of the Project, including, but not limited to, where applicable, issuing Invitations to Bid and selecting contractors."
Under these circumstances, we agree with the Energy Authority that Kwig Power waived its right to protest the installation of Controlled Power switchgear. It forfeited this claim by leading the Energy Authority to believe that it acceded to the installation.
Our position is not changed by Kwig Power's assertion in the complaint that the Energy Authority administers federal grant funds "under a trustee relationship" for the benefit of Kwig Power and other villages. Kwig Power waived this argument by failing to adequately brief it.
Kwig Power asserts separate claims against Noonan for working to exclude the Powercorp system from the Kwigillingok procurement (Count III). The Energy Authority and Noonan defend the superior court's decision to dismiss this claim on various grounds, including waiver, statute of limitations, immunity, and other grounds. Here, too, we conclude that the claim is barred by waiver. As discussed in Part IV.B, the behavior of Kwig Power led the Energy Authority and its employees to believe that Kwig Power acceded to the installation of a Controlled Power system. We affirm the superior court's dismissal of this claim.
Powercorp asserts a claim against Noonan for intentional interference with prospective economic advantage. To establish a claim of intentional interference with prospective economic advantage, the plaintiff must provide evidence of:
Powercorp's intentional interference claim is premised on the notion that Powercorp has an existing prospective business relationship with the Energy Authority, but it has not met this threshold requirement. Procurement laws entitle Powercorp to a fair bidding process in which no particular contractor is
Count IV of the complaint alleges that Noonan misappropriated a Powercorp trade secret and that Controlled Power was unjustly enriched as a result. The parties agree on the outlines of the governing law: A trade secret misappropriation claim cannot be established unless the plaintiff had a trade secret that was communicated to the defendant in circumstances giving rise to a duty of secrecy.
Alaska Statute 45.50.940(3) provides the following two-part definition for the term "trade secret":
The first part of this definition asks if the alleged trade secret is something worthy of being kept secret, and the second part of the definition asks if the alleged trade secret was actually kept secret to a reasonable degree. The following six factors have been used to determine whether information constitutes a trade secret under Missouri's trade secret statute, which adopts the same two-part definition found in AS 45.50.940(3):
Powercorp identifies the subject of its alleged trade secret most clearly when it explains in its reply brief:
(Emphasis added.) At oral argument, Powercorp specified that one part of its secret involves leaving vacant the X4 and X5 terminals of the Woodward controller. The trade secret issue is also addressed in affidavits (some un-notarized) and depositions of some Powercorp employees, as well as Powercorp's responses to discovery. The question before us now is whether Powercorp exercised reasonable efforts to protect its allegedly unique methods of programming and wiring. This is ordinarily a question of fact, although, in some extreme cases, where the plaintiff could not have expected its information to remain secret, this may be resolved as a matter of law.
Powercorp has produced some evidence about the value of its wiring and programming information to its business and to its competitors, the amount of effort or money expended in developing the programming and wiring information, and how difficult it would be for others to properly acquire or duplicate the same information and methods. Powercorp has asserted that it "developed [its] version of the Woodward GCP-31 (known as the GSS) controller over years of working with Woodward's predecessor, Leonhard-Reglenau," and that "nobody but Powercorp and Woodward knew what expanded functions it could do." These assertions are roughly supported by the affidavit of Gavin Bates, which alleges that during the development of the GSS controller, Powercorp and Woodward shared "the understanding that the features we, Powercorp, have paid for will not be incorporated in the version available to the general public."
By sending its confidentiality agreement to the Energy Authority, Powercorp made an effort to keep its information secret.
In light of this evidence, and despite some reservations,
However, we reject the argument that simply using a Woodward controller constitutes a trade secret. It is undisputed that some Woodward controllers, the GCP-30 series, are "sold and distributed throughout the world." The superior court properly summarized the evidence in the record when it stated that Woodward "has no problem with discussing ... how to use [these] devices and how to work with and modify them to accomplish the purpose that the consumer is looking for." And Woodward makes available at least some information about how to wire its controllers. Powercorp argues that certain key pieces of information — such as the idea to leave the X4 and X5 terminals vacant — were not generally available. The idea to leave certain terminals vacant and related programming methods may be relatively unknown. It is also reasonable to infer that any information known to Woodward as a result of its GSS licensing agreement with Powercorp was generally unknown. But it is unreasonable to infer from the record that
For Powercorp's claim to survive, Powercorp must also produce evidence of misappropriation.
The statute provides that "`improper means' includes theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage through electronic or other means."
Powercorp has asserted that the bid specification for ITB REG 04-230 disclosed to Controlled Power key information that Noonan had learned about the Woodward component and how to connect it. But there is no indication in the record that this bid specification contained secret information. The bid specification required use of a Woodward controller. Even if Noonan were responsible for releasing this information and the bid specification provided Controlled Power with the idea to use the GCP-31, the communication of that idea does not violate the trade secrets statute.
Powercorp's main argument under the "misappropriation" prong seems to be that it is inconceivable that Controlled Power would have developed remote monitoring capability without improper access to Powercorp's secret information, which it must have obtained through Noonan. At oral argument before the superior court, Powercorp emphasized that it took years to develop its unique wiring and programming method for use with the Woodward GSS controller. Powercorp contrasted this with the relatively short period in which Controlled Power learned to wire and program a GCP controller for the RPSU contract. Controlled Power admits that its engineers figured out how to wire a Woodward GCP controller in response to the Energy Authority's specification of that device for the REG 04-230 contract. But the fact that Controlled Power was able to use a Woodward controller does not compel the conclusion that Noonan made an improper disclosure to Controlled Power in this case. The superior court properly declined to make this inference.
Powercorp has not presented sufficient evidence to support the inference that Noonan acquired information through "improper means" or that Noonan "knew or should have
Count V of the complaint alleges that Controlled Power misappropriated a Powercorp trade secret and that Controlled Power was unjustly enriched as a result. For this claim to survive summary judgment, Powercorp must produce either evidence of "improper acquisition" under AS 45.50.940(2)(B)(i) or evidence that Controlled Power "knew or had reason to know" that it had received and used a trade secret under AS 45.50.940(2). This evidence is not before us. There is no indication that Controlled Power adopted Powercorp's unique wiring or programming method or used this information in any way. Powercorp has not produced evidence that would rebut the assertions of Controlled Power employees that they were able to wire the GCP controller based on information they obtained from Woodward. While Woodward's willingness to disclose some information about its GCP controllers does not undercut the conclusion that Powercorp's method of wiring and programming constituted a trade secret, the availability of this information is at odds with Powercorp's argument that Controlled Power could not have devised a legitimate wiring method within several months. It is not reasonable to infer that Controlled Power obtained Powercorp's secret wiring and programming information through unlawful misappropriation. We affirm the superior court's decision to dismiss Count V.
Count VIII alleges that Controlled Power colluded with Noonan and others to increase costs and obstacles to other prospective bidders. Powercorp alleged that, as a result of this collusion, the invitation to bid included "a short delivery requirement" with which only Controlled Power could comply and that Controlled Power was able to comply with this requirement only as a result of its contacts with defendants Noonan and Gray. The complaint also alleges that only Controlled Power "was able to reduce the performance bond requirement."
Powercorp mentions Count VIII only once in its opening brief. Count VIII is not clearly addressed in Powercorp's statement of the issues or statement of points on appeal. And Powercorp's brief does not directly address the short delivery or performance-bond requirements mentioned in this part of the complaint. We are unable to discern, and thus unable to address, an argument here. We conclude that Powercorp has waived this argument.
Powercorp also fails to explain how alleged deficiencies in the bid specification could result in any liability for Controlled Power. If this is a claim of tortious interference, it fails for the reasons discussed in Part IV.E. To the extent that the allegations in Count VIII
Powercorp also raises the following points on appeal: (1) The superior court erred in precluding Powercorp from deposing Energy Authority employees Lenny Landis and Bob Havemeister on Powercorp's trade secret claim against Noonan or any other issue; (2) the superior court erred in granting Controlled Power summary judgment on the grounds of failure to identify a trade secret when Powercorp had moved for a protective order to prevent further unauthorized disclosure of a trade secret; and (3) the superior court erred in denying Powercorp's motion to compel Controlled Power to produce correspondence between it and the other defendants. Each of these arguments fails.
As to the first argument, Alaska Civil Rule 26(b)(1) provides:
This standard authorizes the parties to seek substantial amounts of information, but it requires parties to act reasonably. Whether information is "reasonably calculated to lead to the discovery of admissible evidence" depends on the circumstances of the case, and this question is entrusted to the discretion of the trial judge:
The underlying facts of this case were in dispute as early as June 2004 when Powercorp protested the REG 04-230 invitation to bid. Before the complaint was filed in this case, Landis, Havemeister, and Noonan had testified in administrative proceedings concerning Powercorp's REG 04-230 and REG 05-670 bid protests. The complaint in this case was filed in August 2006. The first motion seeking to dismiss claims was filed in February 2008. Motions seeking to dismiss the other claims followed.
Controlled Power filed its motion for summary judgment in March 2008. In November, following an extension, Powercorp opposed the motion for summary judgment and sought a protective order. Controlled Power filed its reply in December, making the motion ripe for resolution by the superior court, which held oral argument in February 2009. In the 11 months before the court ruled on the motion for summary judgment, Powercorp was engaged in a series of discovery disputes with Controlled Power. At the February hearing, Powercorp argued that it should not be required to go to Controlled Power headquarters to examine voluminous discovery documents, which were the subject of earlier orders to compel. At the hearing, the court granted Controlled Power's motion for summary judgment and rejected, as moot, Powercorp's argument about the voluminous discovery. The court later explained that asking Powercorp to bear the costs of traveling to Controlled Power's headquarters was reasonable. This discovery ruling was not an abuse of discretion.
Although it dismissed the claims against Controlled Power, the court granted Powercorp's protective order at the February hearing. Granting Controlled Power's motion for
After the February 2009 hearing, the only remaining claim alleged trade-secret misappropriation by Noonan. Then, between March 19 and 25, 2009, Powercorp apparently contacted the Energy Authority about deposing Noonan, Havemeister, and Landis. On March 26, the Energy Authority asked Powercorp to explain the relevance of the Havemeister and Landis depositions to the remaining claim. On the same day, Powercorp provided barely two weeks notice that it planned to depose Havemeister and Landis on April 7, 2009. Asserting that Powercorp did not respond to its request for an explanation, the Energy Authority then sought a protective order to prevent the Landis and Havemeister depositions from going forward and made a request for expedited consideration.
On April 1, 2009, the court issued an order, which stated:
The parties continued to exchange correspondence on the issue of Landis's deposition in late August 2009, when the Energy Authority stated that Landis would be available for a deposition in September. In the meantime, Powercorp's opposition to Noonan's motion for summary judgment had come due. The superior court had granted an extension on the opposition in April. But it denied a motion to extend the deadline further under Rule 56(f). Powercorp argued that by denying the second extension, the court "effectively granted the motion to quash the depositions." Powercorp claims that without Landis's deposition, Noonan would "have his scapegoat"; by this, Powercorp seems to mean that Noonan could blame Landis for any errors in the procurement process. The final claim, alleging trade secret misappropriation against Noonan, was dismissed at a hearing in September 2009, almost three years after the complaint was filed. The court's decision to dismiss this claim — after three years of litigation and several extensions — was not premature, and it was not an abuse of discretion.
For the reasons discussed above, we AFFIRM the decision of the superior court.
CHRISTEN and STOWERS, Justices, not participating.
WINFREE, Justice, dissenting in part.
WINFREE, Justice, dissenting in part.
I agree with the court's conclusion to reverse the trial court's summary judgment ruling to the extent it was based on the doctrines of collateral estoppel and res judicata. But I am unable to agree with the court's conclusion to affirm at least a portion of that ruling on the alternative ground of qualified immunity for Ron Miller. Official immunity was never raised in the summary judgment motion practice in the trial court, no party had reason to submit evidence on Miller's bad faith during that motion practice, the trial court did not consider or rule on qualified immunity for Miller in that motion practice, and there was no reason to appeal from a qualified immunity decision not made by the trial court. I therefore find procedural unfairness in the court's conclusion that Miller's alleged bad faith is "unsupported by the record [and] waived due to inadequate briefing." I would remand the immunity question for resolution by the trial court after the parties have had a fair opportunity to make an evidentiary record on the question.
I also would reverse the trial court's summary judgment ruling on Powercorp Alaska, LLC's trade secret misappropriation claims
I otherwise agree with today's decision.
Second, Powercorp has left significant gaps in its development of the evidence in this case. Powercorp has not put into the record evidence of its general information-security practices, including information about the number of employees who have access to the Woodward programming/wiring information, whether that information is available to a limited category of employees, or any regular protocols — such as confidentiality agreements, passwords, and locked premises — that might help to limit access to this information. Evidence of these internal information-security practices commonly appears in courts' evaluations of trade secret claims. See, e.g., Cerner Corp., 667 F.Supp.2d at 1077-78 ("Visicu required [non-disclosure agreements] and labeled the documents as confidential and proprietary information. Additionally, while Visicu made sales presentations for its eICU solution and attended trade shows, Visicu did not make handouts available absent a [non-disclosure agreement]."); Crane Helicopter Servs., Inc. v. United States, 56 Fed.Cl. 313, 325-26 (Fed.Cl.2003) ("The list of precautions taken by Bell to protect its trade secret information, as described in Mr. McCrary's unrefuted affidavit, is sufficient to meet this requirement."); Reingold v. Swiftships, Inc., 126 F.3d 645, 650 (5th Cir.1997) ("[D]uring his ownership of the mold Reingold maintained exclusive control and did not disclose it to or allow its use by anyone prior to leasing it to Swiftships."). This information relates directly to the first three factors identified above. Although the parties seem to agree that the GSS controller was manufactured under license from Woodward, Powercorp has not produced the licensing agreement or other evidence of Woodward's specific obligations under the agreement that would support the limited availability of this information. Powercorp is not required to produce evidence of all six factors to survive summary judgment, but the gaps in its evidence are apparent.
