SILVIA CARREÑO-COLL, United States Magistrate Judge.
The parties in this case, unable to agree on a joint protective order, filed competing proposals. See Docket Nos. 118, 119. Defendants' proposal included a patent prosecution bar, see Docket No. 119; Plaintiff's did not, see Docket No. 118. Finding the record insufficient to determine whether such a bar was appropriate, we entered an interim protective order without a prosecution bar and called for additional briefing. See Docket No. 142. After reviewing the
In In re Deutsche Bank Trust Co. Americas, 605 F.3d 1373 (Fed.Cir.2010), the Federal Circuit
Most of the courts interpreting Deutsche Bank
At least one court, however, has taken a different course. The court in Applied Signal Technology, Inc. v. Emerging Mkts. Commc'ns, Inc., No. 09-2180(SBA/DMR), 2011 WL 197811 (N.D.Cal. Jan. 20, 2011), though it also followed a two-part inquiry, framed the question somewhat differently. First, it asked whether, "as a threshold matter[,] the proposed prosecution bar `reasonably reflect[s] the risk presented by the disclosure of proprietary competitive information.'" Id. at *2 (quoting In re Deutsche Bank, 605 F.3d at 1381). It explained that this threshold inquiry "essentially measures whether a prosecution bar is reasonable" given the information at issue, the scope of activities that would be prohibited and their subject matter, and the duration of the bar. Id. At the second step, the Applied Signal court measured this risk — rather than a risk determined by a counsel-specific competitive decisionmaking inquiry — "against the potential injury to the party deprived of its counsel of choice." Id.
The conflict between these two lines of cases is a significant one, concerning, as it does, the movant's burden at the threshold stage: is it necessary that it show, on a counsel-by-counsel basis, that the opposing counsel engage in competitive decisionmaking?, or is it enough that it show that a general bar would be reasonable in this particular case, shifting the burden to opposing counsel to seek exemptions? For several reasons, we think the Applied Signal approach is superior.
First, there is a simple practical problem with what we will call the NeXedge approach. The need for of protective orders, and thus patent prosecution bars, typically arises early in patent cases, before confidential information begins to disseminated. See PETER S. MENELL, ET AL., PATENT CASE MANAGEMENT JUDICIAL GUIDE 4-6 (2009) ("Protective orders should be entered early in the case."). At this early stage, however, it is unlikely that the proponent of a prosecution bar could have sufficient information about opposing counsel's involvement in competitive decisionmaking to make the threshold showing that NeXedge requires.
Moreover, there are several related textual-practical problems that arise from the NeXedge approach. NeXedge requires that the movant first show that opposing counsel is engaged in competitive decisionmaking. 820 F.Supp.2d at 1043. This is confusing, though, because Deutsche Bank's discussion of counsel-specific competitive decisionmaking comes entirely in the context of proceedings seeking to have attorneys exempted from a prosecution bar.
In the section of its opinion immediately preceding its conclusion, the Deutsche Bank court summarized its holdings. Though language in other sections suggests a NeXedge-like rule, in this summary the court essentially provided for a burden-shifting framework. As to whether a patent prosecution bar should be adopted, it held that
605 F.3d at 1381. This is, we think, the only inquiry the court needs to make to impose a general prosecution bar, and it relates only to the reasonableness of the bar itself. The Deutsche Bank court went on to hold that a
Id. Thus, the counsel-specific balancing is done only after a court has decided that a prosecution bar is called for, and it must be initiated by the party seeking the exemption. See id. (referring to the exemption-seeking party as the "moving party").
The only question before us today is whether a general prosecution bar should be entered in this case. Accordingly, we consider solely whether the proposed bar is reasonable under Deutsche Bank. See id.; see also Applied Signal, 2011 WL 197811, at *2 (describing the reasonableness inquiry).
In assessing whether a prosecution bar is reasonable, we look first at whether "the information that will trigger the bar is relevant to the preparation and prosecution of patents before the PTO." Deutsche Bank, 605 F.3d at 1381. Not all confidential or proprietary information is the sort that would "normally be expected to trigger a patent prosecution bar," for example "financial data and other sensitive business information." Id. A prosecution bar might be more reasonable, however, when the triggering information "relate[s] to new inventions and technology under development, especially those that are not already the subject of pending patent applications." Id. (noting that this sort of information "may pose a heightened risk of inadvertent disclosure").
Defendants' proposed prosecution bar
More problematic, however, is the scope of the subject matter that Defendants wish the prosecution bar to cover. Their proposal calls for a bar on prosecuting patents "relating to the subject matter" of the confidential information triggering the bar as to any particular individual. Docket No. 150-2, at 3. Defendants call this narrow tailoring, see Docket No. 150, at 8, but it strikes us as circular and vague. We agree with the Applied Signal court that the subject matter of a prosecution bar should be "coextensive with the subject matter of the patents-in-suit," Applied Signal, 2011 WL 197811, at *3, and we think that Defendants' proposed language fails by this standard, as it in fact provides no ex ante limitation whatsoever and instead allows the bar's subject-matter scope to be defined later by the information that is ultimately produced during discovery. We find this impermissible and hold instead that the scope of the subject matter covered by the prosecution bar must be limited to the subject matter of the patents-in-suit in this case.
Finally, as to the prosecution bar's duration, we think Defendants' proposal is excessively onerous. We agree with Plaintiff that the bar's duration should not be determined by this case's future life in the courts of appeals. See Docket No. 155, at 8 (quoting James Juo & David J. Pitman, A Prosecution Bar in Patent Litigation Should Be the Exception Rather than the Rule, 15 VA. J.L. & TECH. 43, 73 (2010) (arguing that patent prosecution bars' durations "should not depend on the length of litigation" — and especially not on the exhaustion of appeals)). Instead, we hold that the duration of the bar should be one year from a final judgment in this court.
There are two last issues raised by the parties' briefs. The first concerns whether the prosecution bar should apply, as Defendants' proposal does, to "any individual," including experts and technical advisers. See Docket No. 150-2, at 2. Plaintiff argues that the bar, if imposed, should apply only to counsel, but we see no reason why the concerns motivating the prosecution bar — risk of inadvertent disclosure — would not also apply to experts or technical advisers. See Applied Signal, 2011 WL 197811, at *5 ("Allowing experts who prosecute patents themselves to access
For the reasons stated above, we find that a patent prosecution bar is warranted in this case. However, we find Defendants' proposal to be deficient in several respects. Accordingly, the parties are given ten days to jointly file an updated protective order containing a patent prosecution bar consistent with this opinion.
IT IS SO ORDERED.
U.S. Steel Corp. v. United States, 730 F.2d 1465, 1468 n. 3 (Fed.Cir.1984); see also Matsushita Elec. Indus. Co., Ltd. v. United States, 929 F.2d 1577, 1580 (Fed.Cir.1991).