Trucking Companies and Trade Secrets

Safety and Training Documents are not Trade Secrets

Trucking Accident Lawyers in tractor trailer cases often seek safety budgets, safety documents, training budgets and policy and procedure materials from the defendant trucking company.  Tractor Trailer companies often assert that such documents are protected from disclosure as “trade secrets.”  The first question is whether any of this material is a “trade secret” in the first place. Every motor carrier must comply with the same safety, training and policy requirements mandated by the Federal Motor Carrier Safety Administration. The relevant sections of the requested materials involve safety and training, something that comes from government requirements and industry standards. 

This technical brief will address these arguments pursuant to applicable Georgia Law.  Consider as an example, a typical document request, 

“All correspondence and documents regarding any safety issue, including but not limited to the initiation, investigation, and final conclusion of any:

  1. warning letters;
  2. targeted roadside inspections;
  3. offsite investigation;
  4. onsite investigation;
  5. cooperative safety plan;
  6. notice of violation;
  7. notice of claim/settlement agreement; and
  8. documents that stated motor carrier was unfit;

 These are not “secrets.”  They are documents evidencing compliance with, and communication from, the Federal Motor Carrier Safety Administration (or FMCSA).  Furthermore, the remaining requests seek materials that are “well known in the industry.”  The matters in this case do not possess genuine novelty as all motor carriers must comply.  Hence, these matters are not trade secrets and should not be protected.

Further, the requested safety, training & policy materials do not provide a competitive economic advantage.  They are required protocols mandated by the FMCSA to save lives.  There is no indication that a competing motor carrier sufficiently informed with the Federal Motor Carrier Safety Regulations would derive any monetary or competitive advantage in acquiring federally mandated safety, training or policy materials.  For that matter, a competitive advantage for a trucking company should never be “We have a secret that saves lives. . . and we will not share it.” 

In the event that a Defendant Trucking Company or motor carrier files a Motion for Protective Order, it must provide the Court with facts and a specific identification of the harm that will occur by producing the requested documents. A Tractor Trailer company cannot provide bare objections without any specific factual detail or identification of harm. Mere conclusions in the manner presently demonstrated in Defendants objections are insufficient.  Even assuming a Defendant Trucking Company offers factual information and manages to articulate an identifiable harm, the public welfare should outweigh Defendant’s desire to keep the documents concealed.  Trucking companies must be safe or people die.  In 2009, there were 3,197 deaths per year from tractor-trailer collisions.[1] The public’s need to know about safe operation of tractor-trailers is of particular public interest.

Criteria for Determining a Trade Secret

Pursuant to the Georgia Code, “Trade secret,” “means information including, but not limited to, technical or nontechnical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, product plans, or a list of actual or potential customers or suppliers which: (A) Derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and (B) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” (Emphasis supplied.) OCGA § 10-1-761(4); see also Taylor Freezer Sales Company v. Sweden Freezer Eastern Corp.,224 Ga. 160, 163-65(2) (1968).

Examples of Trade Secrets

The very first inquiry is whether the matter is a trade secret at all.  Examples of trade secrets include the formula to Coca Cola or a unique process which is not known in the industry, Essex Group, Inc. v. Southwire Co., 269 Ga. 553, 554-55 (1998) or customer lists, Paramount Tax & Accounting, LLC v. H&R Block Eastern Enterprises, Inc., 299 Ga. App. 596, 597 (2009) or some unique manufacturing process. American Buildings Company v. Pascoe Building Systems, Inc., 260 Ga. 346 (1990).

However, the matter is not considered a trade secret if it is “well known in the industry,” or where other people in the industry have similar or identical knowledge about the process. Wilson v. Barton & Ludwig, Inc., 163 Ga. App. 721, 725 (1982) citing Textile Rubber & Chemical Co. v. Shook, 243 Ga. 587, 589-590.  To be protected, the matter must possess genuine novelty and invention which is not the result of adaptation of existing knowledge even if cleverly adapted. Wilson v. Barton & Ludwig, Inc., 163 Ga. App. at, 725.   

Derives Economic Value

To be considered a protected trade secret, the matter must also derive some economic value. In other words, a competitor could reap economic value (beyond its own abilities) if it acquired the protected information. Capital Asset Research Corp. v. Finnegan, 160 F.3d 683, 688 (1998).  The matter must afford the possessor some competitive advantage. Capital Asset Research Corp. v. Finnegan, 160 F.3d at 688.  The matter must provide an advantage to a competitor beyond that which a sufficiently informed and experienced competitor has the ability to do. Id.

Efforts to Maintain Secrecy

Georgia law requires that a company undertake reasonable efforts to maintain confidentiality of the protected matter in order to claim status as a trade secret. Smith v. Mid-State Nurses, Inc., 261. Ga. 208, 209 (1991).  The company must produce evidence of efforts to maintain confidentiality of the information. Smith v. Mid-State Nurses, Inc. 261 Ga. at 209. For example, evidence that customer lists are not freely or widely disseminated or that employees must sign agreements to keep such information secret constitute sufficient evidence of efforts to maintain confidentiality. Avnet, Inc. v. Wyle Laboratories, Inc., 263 Ga. 615, 617 (1993). Even so, overly broad covenants issued to all employees to keep matters secret are insufficient. See Equifax Services, Inc. v. Examination Management Services, Inc., 216 Ga. App. 35, 40 (1994).

Defendant must Show Good Cause

Where a party asserts a trade secret, it may move for a protective order. O.C.G.A. Sect. 9-11-26(c)(7).  The moving party must show good cause for the issuance of a protective order. Young v. Jones, 149 Ga.App. 819 (1981).  Georgia Courts recognize that such orders prohibit discovery.  Accordingly, the moving party must provide facts and specific identification of the harm that will occur. Jones v. Young, 149 Ga. App. 819.  Mere conclusions are insufficient. Id.  As was said, in Young v. Jones, “good cause for the issuance of a protective order designed to frustrate discovery must be clearly demonstrated. Such cause necessarily is not established by stereotyped or conclusional statements bereft of facts.” Id. at 824; see Christopher v. State, 185 Ga. App. 532, (1988) (no attempt to specify how prejudice would occur).

In that regard, Federal Courts have held that to make a showing of good cause, the party seeking confidentiality has the burden of showing the injury ‘with specificity.’” Pearson v. Miller, 211 F.3d 57, 72 (3rd Cir. 2000); In order to show “good cause,” “[t]he moving party must show that disclosure will work a clearly defined and serious injury.” Hamilton v. State Farm Mut. Auto. Ins. Co., 204 F.R.D. 420, 424 (S.D. Ind. 2001). “[B]road allegations of harm, unsubstantiated by specific examples or articulated reasoning, do not satisfy the Rule 26(c) [good cause] test.” Beckman Indus. v. International Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992).

Balancing Disclosure vs. Public Interest in Safety

Federal courts recognize a balancing of interests in determining good cause between the matter sought to be protected and the public welfare. Chicago Tribune Co, et. al. v. Bridgestone / Firestone, Inc., 263 F.3d 1304, 1313 (2001). The courts have balanced the interest in disclosure and the public interest, safety or free speech. Chicago Tribune Co, et. al. v. Bridgestone / Firestone, Inc., 263 F.3d at 1315; Farnsworth v. Proctor & Gamble, 758 2d. 1545 (1985). As was said by the 11th Circuit Court of Appeals in Chicago Tribune, “concerns of public health and safety trump any right to shield [protected matters] from public scrutiny.” Chicago Tribune, 263 F.3d at 1315 [emphasis added]. Inherent in this process is the recognition of the right of access to court records. There is no question that “the courts of this country recognize a general right to inspect and copy public records and documents including judicial records and documents.” Nixon v. Warner Communications. Inc., 435 U.S. 589, 597 (1978). This right of access to court records, like the openness of court proceedings, enhances the basic fairness of the proceedings and safeguards the integrity of the fact-finding process. Press-Enterprise Co. v. Superior Court, 464 U.S. 501, 508 (1984); Globe Newspapers Co. v. Superior Court, 457 U.S. 596, 606 (1982).

Accordingly, the safety and training related documents considered in this brief are not trade secrets, are not unique, offer no competitive monetary advantage to competitors and should be disclosed in the interest of promoting the safety of the motoring public. 

[1] U.S. Department of Transportation, Publication No. FMCSA-RRA-11-024.

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