BAYER CORPORATION AND SUBSIDIARIES v. THE UNITED STATES, No. 2:2009cv00351 - Document 45 (W.D. Pa. 2010)

Court Description: MEMORANDUM AND OPINION re: 32 MOTION for Protective Order filed by BAYER CORPORATION AND SUBSIDIARIES. Plaintiff's 32 Motion for Protective Order is granted insofar as the Court shall enter a protective order, but the language of the Order shall be as set forth in the version entered in the docket immediately hereafter. Signed by Judge William L. Standish on 7/20/2010. (md)

Download PDF
BAYER CORPORATION AND SUBSIDIARIES v. THE UNITED STATES Doc. 45 IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA BAYER-ONYX, a partnership, by BAYER HEALTHCARE, LLC, its tax matter partner, ) ) ) ) ) Plaintiff, ) vs. Civil Action No. 08-693 ) ) THE UNITED STATES, ) ) Defendant, ) and BAYER CORPORATION AND SUBSIDIARIES, Plaintiff, vs. Civil Action No. 09-351 THE UNITED STATES, Defendant. MEMORANDUM OPINION These Corporation, suits its focus on the subsidiaries, efforts and of Plaintiffs Bayer-Onyx Bayer (collectively, "Bayer") to recover some $50 million in federal income tax payments to which Plaintiffs argue they are entitled as qualified research tax credits under 26 U.S.C. Plaintiffs' motion seeking testimony and other during discovery Protective Order, § in 41. a Now pending before the Court is protective "Confidential the Doc. No. Information" litigation. 32, order "Mot. (Motion II ) for documents, to be for produced Entry of a Bayer is particularly Dockets.Justia.com concerned about information regarding its research and development efforts because the discovery requests propounded by the United States seek production of materials including "confidential and proprietary information, trade secrets, strategic planning information commercial information, commercial planning information l and commercial pricing relating to the sale marketing of certain products. (Mot., 1I セ@ 1 distribution and/or l 6.) In addition some l discovery requests call for personal and financial information of (Id. ) Bayer employees and third parties. Although the parties attempted to arrive at a mutually agreeable protective order through a series of negotiations, the sticking point is language proposed by Defendant which l as currently drafted, would allow the Confidential Information to be passed by the Department of Justice or Internal Revenue Service (the "Government ll ) to other Federal agencies and departments if the information, either on information "indicates a violation or potential violation of law l criminal, civil, or its face or regulatory in conjunction with other in nature. III While Bayer recognizes that there may be circumstances in which the Government would wish to - or be compelled to - share Confidential Information wi th other government entities it 1 seeks language which would MNセ I The Court recognizes that during the briefing of this Motion the parties arrived at language in the proposed Protective Order which was different from that originally proposed. We consider only the language of the proposed Bayer version of the Order attached as Exhibit A to Bayer's reply memorandum, Doc. No. 34 1 and that of the Government attached as Exhibit B to the same pleading. l 2 protect its information from dissemination beyond the Department of Justice or Internal Revenue Service to other agencies where, for example, trade competitors secrets through a could be Freedom inadvertently of Information released to request or Act employees' personal information such as horne addresses and social security numbers could be acquired by identity thieves through accidental loss or distribution. The United states initially protective order on two levels. opposed the motion for a First, Defendant argued that the protective order should not be granted under any circumstances because Bayer failed to corne forward with evidence to establish that any level of protection was required. that in cases confidential involving business the Apparently recognizing extensive practices such discovery those regarding involved herein protective orders are routinely granted by the Courts even if the parties cannot themselves agree on the need for such an action (see t e.g., County of Santa Clara v. Astra United States, 588 F.3d 1237, 1249 (9 ili Cir. 2009) enter protective orders I noting that "district courts routinely to prevent commercially sensitive information") t the undue disclosure of the Government subsequently withdrew this argument and proposed its own version of the order. Defendant now argues that if such an order is entered, it must not contain language proposed by Bayer which the Government believes would disrupt the ability of the Department of Justice or the 3 Internal Revenue Service to perform its statutory, regulatory and (The United States' constitutional obligations. Opposition to Bayer's Motion for Entry of a Protective Order, Doc. No. 33, "Gov't Opp ." at 9 - 10 . ) According to the Government's brief in opposition and Bayer's reply brief, the parties agree on all but one paragraph of the current version of the proposed protective order. focused on paragraph 20 i version is set out below, the Government's The dispute is currently proposed with the further modifications Bayer seeks shown in bold italic typeface: Notwithstanding the any other provisions of this Order, Counsel for the United States may disclose Confidential Information to other Federal agencies or departments, which would also be bound by this Order, if ï½ ï½¯ï½µï½®ï½³ï½¥ï½¾ï¼  for the United States イ・。ウッョ「セケ@ 「・セゥカウ@ that Confidential Information, either on its face or in conjunction with other information, indicates a violation or potential violation of law criminal, civil or l:egulatol:'Y in nature. 」イゥュョ。セ@ セ。キ@ or a risk to ョ。エゥッセ@ security or to ーオ「セゥ」@ ィ・。セエ@ or safety. Further, 「・セゥカウ@ i f ï½ ï½¯ï½µï½®ï½³ï½¥ï½¾ï¼  for the Uni ted Sta tes イ・。ウッョ「セケ@ that ï½ ï½¯ï½®ï½¦ï½©ï½¤ï½¥ï½´ï½¡ï½¾ï¼  Information, either on its face or in conjunction with other information, indicates a カゥッセ。エョ@ ッイーエ・ョゥ。セ@ カゥッセ。エョ@ of 」ゥカセ@ or イ・ァオセ。エッケ@ セ。キL@ it ウィ。セ@ notify Bayer at セ・。ウエ@ fourteen (14) days before making any 、ゥウ」セッオイ・@ of ï½ ï½¯ï½®ï½¦ï½©ï½¤ï½¥ï½´ï½¡ï½¾ï¼  Information to other ヲ・、イ。セ@ agencies or departments, which キッオセ、@ 。セウッ@ be bound by this Order, to 。セッキ@ Bayer to seek appropriate safeguards. In short, where the Government has identified "particular circumstances that present a reasonable need for secrecy or urgent action," i.e., in the case of suspected criminal violations or a 4 risk to national security or public health and safety, the language of the first sentence above without Court oversight. would allow Defendant to proceed (Reply Memorandum in Support of Bayer's Motion for Entry of a Protective Order, Doc. No. 34, "Reply Memo," at 3 -4. ) Bayer does not dispute the right of the Government to share such information with the appropriate agencies under such "urgent" circumstances. The "appropriate safeguard" Bayer would seek under the circumstances set out in the second sentence would be Court review of the propriety of the proposed release to another government agency of the information in question. Bayer acknowledges 4. ) (Reply Memo at that if the Court were persuaded that disclosure of Confidential Information indicative of a "violation or potential violation of civil or regulatory law" was appropriate under federal information. law, Defendant would be free to share that (Id. ) In addition to the briefs submitted by the parties, the Court heard oral argument on this question on July 15, 2010. is not convinced that Bayer' s concerns about the The Court resul ts of inadvertent disclosure through another government entity with which Defendant has shared Plaintiff paints them. information The are Court as dire recognizes or imminent that Bayer as has legitimate concerns about harm either to the corporation or to its employees which could potentially occur if information is shared without adequate safeguards. However, as both parties acknowledge, 5 the Protective Order elsewhere provides substantial protection. Most importantly, Bayer is not precluded "from seeking additional relief from the Court not specified in this Protective Order, or from applying to the Court for modification of this agreement or (See Protective Order further or additional Protective Orders." セ@ entered by the Court simultaneously herewith, 21.) As the United States Court of Appeals for the Third Circuit noted in Pansy v. Borough of Stroudsburg, where a broad umbrella protective order has been put in place, the party seeking to limit dissemination of specific discovery material may demonstrate "good cause" why a particular document should be protected to a greater degree. id., 23 F.3d 772, 786 (3d Cir. see 1994) i Pennsylvania, 477 F.3d lOS, 108 (3d Cir. also Arnold See v. 2007), and United States v. Chromatex, Inc., CA No. 91-1501, 2010 U.S. Dist. LEXIS 67101, *18-*20 (M.D. Pa. July 6, 2010), reiterating the factors set forth in Pansy which a court must consider in determining if the party seeking protection has established good cause. The fact that the Protective Order requires the federal agency or department with which any information is shared to be bound by the same Order as the original parties further protects Bayer's interests since the Order covers dissemination of the Confidential Information not only during the pendency of this action, but also after its termination. federal (Protective Order, agency or department セ@ 23.) which receives 6 the Second, the Confidential Information from the Defendant becomes a "Receiving Party" as that term is defined in the Order, with all the obligations of the Defendant set out therein, including the obligation to destroy or return all exceptions) litigation. the confidential within sixty (Id., Government to セ@ information (60) 18.) (with some specified days after the conclusion of the Finally, the Protective Order requires immediately advise Bayer if it learns that Confidential Information has been disclosed to any person in a manner other than that authorized in the Order, and to take steps to prevent further disclosure by any such unauthorized person. (Protective Order, argument, its セ@ 19.) failure to As the Government conceded at oral comply with this provision would presumably open the door to a motion for sanctions by Bayer. Having reviewed in detail the arguments of both parties, the Court concludes that the language proposed by the Government is sufficient to protect Bayer's interests in this matter. Plaintiff's motion at Doc. No. 32 is therefore granted insofar as the Court shall enter a protective order, but the language of the Order shall be as set forth in the version entered in the docket immediately hereafter. July £tp , 2010 William L. Standish United States District Judge 7

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.