Civil Practice – Discovery – Non-Party Subpoena – Direct Competitor

ARRIS Group, Inc. v. CyberPower Systems (USA), Inc. (Lawyers Weekly No. 020-064-17, 14 pp.) (Adam Conrad, J.) 2017 NCBC 57

Holding: Subcontractor CyberPower, which lost its subcontract and is being sued by contractor ARRIS, can subpoena its replacement subcontractor, Delta Products Corp., for some documents, including the new contract between ARRIS and Delta, to the extent such a contract exists. This request is targeted and does not seek more voluminous or sensitive information associated with ARRIS’ and Delta’s agreement, such as communications regarding their negotiations.

CyberPower’s motion to compel production is granted in part and denied in part.

CyberPower is also entitled to any product specifications delineated by ARRIS. Although the subpoena includes no relevant time period, the documents were likely produced in 2006, when both CyberPower and Delta were first creating the relevant power supplies, and 2012, when ARRIS decided to replace CyberPower’s products with Delta’s. There is no indication that these specifications, which were created by others, include Delta’s confidential information.

To the extent CyberPower seeks Delta’s own technical specifications, these are highly confidential and likely the subject of trade secret protection. CyberPower has made no showing of a substantial need to warrant compelling a nonparty to provide such information to a direct competitor. It is unclear whether CyberPwer has even tried to obtain representative product samples from ARRIS. The court finds no substantial need sufficient to warrant production of Delta’s product specifications.

CyberPower also requests production of communications between Delta and ARRIS or project owner Verizon regarding the operating conditions for the relevant product – a power supply – or its battery backup component and any component parts. These requests, which include no temporal limitation, are facially overbroad. Furthermore, some responsive communications would likely encompass confidential information, and Delta attests that such communications are protected by nondisclosure agreements. CyberPower has not demonstrated a substantial need for this confidential information at least because it has not shown that it made any effort first to obtain representative products from ARRIS and test them.

CyberPower’s final, catch-all request for “[a]ll documents relating to the determination, calculation or analysis of the operating, service or useful life of the Power Supplies or [battery backup components],” exhibits no clear scope, has no temporal limitation, is facially overbroad, would impose an undue burden on Delta, and encompasses confidential and likely trade-secret information for which CyberPower has failed to demonstrate a substantial need. The court denies the motion as to this request.

Motion granted in part and denied in part.