Regulatory: A Lone Pine order for trade secrets litigation?

Unless the plaintiff is absolutely certain of dismissal, demanding detailed, early disclosures may not be the best option

The Lone Pine order is now a well-established aspect of mass tort and product liability litigation. First issued in a 1986 New Jersey state court case, Lore v. Lone Pine Corporation, the court’s case management order in that case required plaintiffs to provide expert reports supporting a causal link between the alleged injuries and defendant’s landfill, and plaintiffs’ failure to come forward with such evidence resulted in dismissal of their claims. The Lone Pine order acts a gatekeeper to eliminate baseless claims at an early stage of the litigation by demanding evidence on a threshold scientific question.

At first blush, the Lone Pine approach may seem readily adaptable to trade secrets litigation. Instead of requiring plaintiff to produce an expert affidavit, a gatekeeping order might instead require detailed disclosures of plaintiff’s alleged trade secrets sufficient to demonstrate a reasonable basis for claiming trade secret protection. There is a body of precedent supporting such orders as appropriate case management tools, especially in cases where the plaintiff’s initial pleading offers only vague allegations regarding the existence of the trade secrets.

Although a defendant may be able to persuade the court to require more detailed disclosures from the plaintiff at an early stage of the litigation, it is doubtful whether imposing this additional burden on the plaintiff would actually provide a sufficient basis for dismissal of the plaintiff’s complaint in most trade secrets suits. Certainly, a plaintiff who simply refused to comply or who provided a patently inadequate disclosure might face dismissal. It is more likely, however, that even a plaintiff with only the thinnest possible basis for alleging the existence of a trade secret could cobble together a sufficient disclosure to avoid summary dismissal of its claim.

A second hurdle is that trade secrets claims are typically pleaded in conjunction with other contract and tort claims, such as breach of a nondisclosure agreement, breach of an employee’s duty of loyalty, or unfair competition. The scope of discovery and triable issues for these claims may be substantially the same as for the trade secrets claim. In other words, a gatekeeping test for the trade secrets claim might succeed only in eliminating a legal theory without materially impacting case management.

Unless the defendant is confident that demanding early, detailed disclosures of plaintiff’s trade secrets will create an insurmountable hurdle and dismissal of plaintiff’s case, the defendant should consider carefully whether even to pursue this strategy. Compelling the plaintiff to present detailed disclosures forces the plaintiff to analyze its claim and carefully develop its case theory. There may be cases where the defendant is better served by exploiting the plaintiff’s lack of preparation and patiently waiting for the plaintiff’s case to fall apart during depositions or after the close of discovery. Winning a trade secrets case as a plaintiff requires careful planning and a well-developed case theory. For the defendant, the best strategy may be to lull the plaintiff into a false sense of confidence in their own case theory until it is too late for the plaintiff to correct its mistakes.

Contributing Author

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Matthew Prewitt

Matthew Prewitt is a partner in the Chicago office of Schiff Hardin, where he concentrates in complex litigation and also co-chairs the firm's Trade Secrets Client Services...

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