MIAMI BUSINESS LITIGATION: FLORIDA LAW CONCERNING DISCOVERY OF TRADE SECRETS

Florida law contains an explicit privilege against disclosure of alleged trade secrets. This trade secret privilege is set forth in Florida Statutes Section 90.506, which states in pertinent part: “A person has a privilege to refuse to disclose, and to prevent other persons from disclosing, a trade secret owned by that person if the allowance of the privilege will not conceal fraud or otherwise work injustice. When the court directs disclosure, it shall take protective measures that the interests holder of the privilege, the interests of the parties, and the furtherance of justice require.” To ensure that this privilege is properly protected, courts have set forth a three-step analysis for trial courts to undertake when faced with a claim that a discovery request seeks production of protected trade secret information. Trade secrets often are asserted in lawsuits, including lawsuits involving non-compete agreements, claims of unfair competition, and employment law. Peter Mavrick is a Miami business litigation attorney, and represents clients in business litigation in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The first step requires the trial court determine whether the information requested constitutes or contains trade secret information. This step will usually, but not always, require the trial court to conduct an “in camera review” of the documents to determine whether, in fact, they contain trade secret information. The legal term “in camera review” means that the Judge reviews documents outside of the view of the public, to retain confidentiality of the information the Judge is reviewing. Generally, if the parties agree that the documents contain trade secret information, then no in camera review would be needed. Where the parties disagree on whether the requested documents contain trade secret information, an in camera review or evidentiary hearing will be needed. Florida’s Third District Court of Appeal explained in Coast Fire, Inc. v. Triangle Fire, Inc., 170 So.3d 804 (3d DCA 2014), that “[s]uch a hearing may include expert testimony … Expert testimony may be particularly useful in cases where the trial court does not have requisite experience in examining the subject information.” Revello Med. Mgmt., Inc. v. Med-Data Infotech USA, Inc., 50 So.3d 678 (Fla. 2d DCA 2010), also explained that “if the circuit judge does not have the requisite experience in examining [computer source] code, he may wish to appoint a neutral computer expert to review [the party’s] program.”

If the Judge determines in this first step that the discovery request seeks information subject to the trade secret privilege, the second step of the analysis requires the Judge to determine “whether the party seeking production can show reasonable necessity for the requested information.” Ameritrust Ins. Corp. v. O’Donnell Landscapes, Inc., 899 So.2d 1205 (2d DCA 2005). This step usually requires the trial court to decide whether the need for producing the documents outweighs the interest in maintaining their confidentiality. This is a fact-intensive analysis.

Finally, if the court determines that there is a reasonable necessity for production of the trade secret information, the third step requires the trial court to determine “whether safeguards are required to prevent its unnecessary dissemination.” Summitbridge Nat’l Invs., LL v. 1221 Palm Harbor, L.L.C., 67 So.3d 448 (Fla. 2d DCA 2011). Such safeguards may include a confidentiality order to protect the information from inappropriate disclosure to third parties.

Peter Mavrick is a Miami business litigation lawyer, and represents clients in Fort Lauderdale, Boca Raton, and Palm Beach. This article does not serve as a substitute for legal advice tailored to a particular situation.