A recurring procedural dispute arises in theft of trade secrets lawsuits.\u00a0 How should a trial judge resolve a Plaintiff\u2019s request to exclude a Defendant from the courtroom during the time the plaintiff discloses its trade secrets to the court?\u00a0<\/p>\n
Defendants argue that due process guarantees them the right to be present in court at all times during a lawsuit.\u00a0 Plaintiffs argue that the trial court possesses discretion to exclude Defendants from the courtroom while allowing the Defendants\u2019 attorneys and retained expert witnesses to remain (the lawyers and expert witnesses would be prohibited from disclosing the trade secrets to the Defendant).<\/p>\n
On May 20, 2016, the Texas Supreme Court issued an opinion addressing a Plaintiff\u2019s effort to exclude a Defendant\u2019s corporate representative from a temporary injunction hearing while the Plaintiff testified about its trade secrets.\u00a0 The Plaintiff did not seek to exclude from the hearing defense attorneys or retained experts.\u00a0 The Plaintiff also did not seek to exclude another defendant who used to work for the Plaintiff and who allegedly knows the trade secrets at issue.\u00a0 The case is In re M-I L.L.C<\/em><\/a>.<\/p>\n The Texas Supreme Court ruled that the U.S. Constitution Fourteenth Amendment Due Process Clause mandates a presumption in favor of a defendant participating in court proceedings, but there is no absolute right to be present \u2013 even at a civil trial.\u00a0 The competitive harm that the Plaintiff would suffer from disclosure of its trade secrets to a particular person designated as the Defendant\u2019s corporate representative must be weighed against the presumption in favor of the Defendant\u2019s participation.\u00a0 Trial courts must now consider these three factors to determine whether a Defendant\u2019s corporate representative may be excluded from the courtroom:<\/p>\n The Texas Supreme Court did not decide whether the trial court should have excluded the Defendant\u2019s corporate representative from the temporary injunction hearing.\u00a0 Instead, the Supreme Court ruled that the trial court committed error by not conducting the \u201cdue-process balancing\u201d test list above.\u00a0 The issue now goes back to the trial court to decide whether to grant or deny the Plaintiff\u2019s request.<\/p>\n Although the opinion only involved a specific scenario (a request to exclude a corporate representative from a temporary injunction hearing), it also provides guidance for how trial courts should resolve other requests to prevent disclosure of trade secrets to litigants.\u00a0 For example, the issue can arise when deciding who may attend depositions or trial and which persons may view documents exchanged in discovery.<\/p>\n <\/p>\n photo credit: Back of the courtroom<\/a> via photopin<\/a> (license)<\/a><\/p>\n\n