How to Respond When Subpoenaed for Trade Secrets or IP

How to Respond When Subpoenaed for Trade Secrets or IP

Getting a subpoena for your trade secrets or intellectual property can be scary. You might feel anxious about having to share confidential information or worried you’ll get in trouble if you don’t comply. But there are things you can do to protect yourself and your business interests when faced with a subpoena. This article will walk you through the basics of responding to a subpoena for trade secrets or IP, so you can handle the situation calmly and strategically.

What is a subpoena?

A subpoena is a legal demand for information, documents, or testimony. Subpoenas are used during the discovery process in a lawsuit or investigation to gather evidence from third parties not directly involved in the case. For example, if Company A sues Company B for patent infringement, Company A could subpoena you – Company C – to provide documents or testify about your business relationship with Company B.

There are two main types of subpoenas:

• A subpoena duces tecum demands that you produce documents or other records.
• A subpoena ad testificandum requires you to provide testimony at a deposition, hearing, or trial.

Subpoenas are issued by the court or an attorney involved in the case. You are legally required to respond to a subpoena or you could face contempt charges. But that doesn’t mean you have to hand over trade secrets or confidential information without thinking it through.

Get organized

When you receive a subpoena, your first move should be to get organized. Make copies of the subpoena and supporting documents so you have them handy. Review the subpoena carefully to understand what exactly is being requested – documents, testimony, or both. Note any deadlines for responding. Then gather the contact information for the party that issued the subpoena as well as their legal counsel. You’ll need this info for the next steps.

Consult a lawyer

Before responding to a subpoena involving trade secrets or intellectual property, it’s essential to consult an attorney experienced in these matters. Here’s why:

• An attorney can advise you on the scope of the subpoena – whether it’s overly broad or seeks privileged information.
• They can negotiate with the issuing party to modify or limit the subpoena.
• If needed, they can file a motion to quash or protective order.
• They can ensure you respond in a way that protects confidentiality.

An attorney can also advise you on your options for producing documents, including requesting attorneys’ eyes only designation or filing documents under seal. Having expert counsel ensures your legal rights and interests are protected.

Negotiate the scope

Before producing any confidential information, your attorney should contact the issuing party to discuss the scope of the subpoena. See if you can come to an agreement about narrowing the request to reduce the amount of sensitive material you have to provide. For example, you may be able to:

• Limit the date range for communications and documents.
• Omit certain categories of documents unrelated to the case.
• Anonymize documents by redacting names, dollar amounts, or other details.
• Provide summaries rather than full documents.

If you can focus the subpoena on just the essential information needed for the case, you can better protect your trade secrets. The issuing party may be willing to compromise, but if not, your attorney can get the court involved to object to an overbroad subpoena.

Get a protective order

If narrowing the scope doesn’t satisfy your confidentiality concerns, your attorney can seek a protective order from the court. This legally limits how the subpoenaed information can be used and prevents further disclosure. Typical protections include:

• Attorneys’ eyes only – only outside attorneys can view sensitive material.
• Filing under seal – documents are kept confidential on the court docket.
• Return after the case – materials must be returned or destroyed after the case.
• Non-disclosure agreements – parties must sign an NDA regarding the information.

The court will grant a protective order when there is good cause to keep the requested information confidential. Your attorney can explain why the materials deserve trade secret protection.

Assert privileges

Certain materials and communications are protected from disclosure through legal privileges. Your attorney can identify what may qualify for attorney-client privilege or work product protection. For example:

• Attorney-client emails or memos exchanged for legal advice.
• Documents prepared in anticipation of litigation.
• Confidential research done at your attorney’s request.

You can prepare a privilege log that describes these documents so the requesting party knows you are asserting a privilege. While you can’t completely refuse to respond to a subpoena, privileges limit what you have to produce.

Follow protocol for production

Once you’ve negotiated the scope and protections, you can begin properly responding to the subpoena. Your attorney will ensure you follow the right process, which typically includes:

• Bates stamping all documents for identification.
• Organizing documents as requested.
• Providing a signed declaration certifying your response.
• Sending documents via secure portal or encrypted hard drive.

Responding efficiently and transparently helps demonstrate you are complying in good faith. Refusing to respond or obstructing the subpoena could lead to court sanctions.

Designate documents as confidential

Your document production should note which materials contain sensitive information and are considered confidential. Discuss designation standards with your attorney, for example:

• Trade secrets – product formulas, algorithms, source code.
• Commercially sensitive – pricing, customers, vendors.
• Private personal info – SSNs, medical records.

Confidential designations prevent your trade secrets from being mishandled and improperly disclosed. Follow up to ensure the receiving party handles your documents according to the agreed terms or court protective order.

Prepare for your deposition

If you’ve been subpoenaed to testify at a deposition, your attorney can help you prepare. During your prep sessions, you’ll:

• Review any documents you’ll be questioned about.
• Discuss areas you should or should not discuss.
• Practice answering questions under oath.
• Learn how to flag inappropriate questions.

Preparing ensures you stay calm, provide clear testimony, and avoid accidentally revealing confidential information. Your attorney will also attend the deposition to object if necessary.

Get reimbursed

Complying with a subpoena takes time and resources. Make sure you get reimbursed by submitting an invoice for reasonable costs such as:

• Attorney fees for reviewing, negotiating, and responding.
• Employee time for gathering and preparing documents.
• Copying, scanning, and shipping expenses.
• Technical expertise for collecting electronic documents.

Most courts require the requesting party to cover these costs under the undue burden doctrine. Keep detailed records so you can justify your expenses.

Remember your options

Getting a subpoena for your trade secrets or IP can be unsettling, but knowledge is power. Keep in mind that you have options:

• Hire an attorney to protect your rights.
• Negotiate the scope of the subpoena.
• Ask the court for a protective order.
• Assert privileges over confidential material.
• Designate documents as confidential.
• Prepare thoroughly for your deposition.
• Get reimbursed for your costs.

By responding thoughtfully and strategically, you can provide the information legitimately sought while safeguarding your sensitive trade secrets and IP. Handled right, disclosing confidential information under subpoena does not have to compromise your business interests.