A recent decision from the Federal Circuit serves as a reminder that trade secrets may be subject to discovery in patent and other non-trade secret litigation when they are relevant to the claims and/or defenses, and a court finds they are protected by adequate safeguards.

In Buergofol GMBH v. Omega Liner Company, Inc., No. 2025-1817, 2025 WL 2048053 (Fed. Cir. July 22, 2025), the plaintiff sued the defendant for patent infringement based on allegations that the defendant used the plaintiff's patented film technology to manufacture its pipe liners.

The defendant denied infringement and asserted counterclaims seeking declarations that the patents were invalid and unenforceable. As part of its claims of invalidity, the defendant alleged the existence of pre-priority-date sales of liners from other manufacturers that used the plaintiff's film technology, which would have constituted prior art. When the defendant sought information about the plaintiff's film technology in discovery to support its claims of invalidity, it led to a dispute that required the district court's intervention.

The Discovery Dispute

The dispute in the district court centered on the defendant's request for documents describing the structure, recipe, and manufacturing steps for the film technology at issue. The plaintiff resisted production, claiming that the defendant's request sought details about its proprietary adhesion promoter, “Wax 40,” which were trade secrets. Accordingly, the defendant moved to compel.

Despite acknowledging the commercial sensitivity of the plaintiff's trade secrets, the district court ordered their production under the “attorney's eyes only” designation specified in the protective order previously entered in the case. The court found that the information related to “Wax 40” was relevant to the issues of both infringement and invalidity, and that the plaintiff put the information at issue by filing the lawsuit. The court also refused to impose additional safeguards beyond those in the existing protective order, finding that the plaintiff failed to show an actual need for further protection beyond mere conjecture or speculation.

As a final effort to avoid the need to produce its trade secrets, the plaintiff filed a petition for a writ of mandamus in the Federal Circuit seeking to vacate the district court's discovery order, coupled with a motion to stay its enforcement.

The Federal Circuit’s Decision

On mandamus review, the Federal Circuit found no clear abuse of discretion, denied the petition, and denied the plaintiff's motion to stay the discovery order as moot.

The Federal Circuit reiterated that trade-secret information “is not immune from discovery; instead, such material may be available upon a showing of relevance and need for such information to prepare for the litigation where the district court decides, in its discretion, that the interests favoring discovery outweigh the harm to the trade secret's owner.” Omega Liner, 2025 WL 2048053, at *2 (collecting cases). In Omega Liner, the plaintiff could not show that the information sought through the discovery requests was irrelevant because disputes remained over the makeup of the allegedly infringing films and the scope of prior art for the plaintiff’s pipe liners. According to the court, those issues required examination of the trade secrets the plaintiff sought to protect (i.e., the composition of the adhesion promoter used in the pipe liners).

The Federal Circuit also found that the need for the discovery outweighed the risk of harm to the plaintiff or its trade secrets in light of the protective order entered in the case, which permitted disclosure exclusively to the defendant's outside counsel. The court noted that the plaintiff had previously produced information pursuant to that protective order without issue and otherwise failed to raise a legitimate threat that someone might violate the order and subject themselves to sanctions. 

Key Takeaways

Parties asserting claims or defenses in a patent (or other) case that may implicate their trade secrets must prepare for the possibility that any relevant trade secret information will be discoverable. Trade secret owners should consider the potential for discovery into their proprietary information when formulating an initial litigation strategy and work with counsel to ensure that any protective order is as robust as possible from the outset of the case.

Omega Liner demonstrates that courts may reject a trade secret owner's subsequent request for additional restrictions beyond what is already in an agreed order, absent a specific, compelling need for the additional protection. A risk of disclosure is unlikely to preclude discovery if the information is relevant and the defendant does not object to production solely to its outside counsel. Where applicable, trade secret owners should articulate concrete reasons why existing protections are insufficient. A protective order formulated at the outset of the case may later prove inadequate, depending on unanticipated issues, the parties' or counsel's conduct, or the necessary involvement of third parties beyond outside counsel (i.e., experts).

The technology that will be employed by the opposing party to download, store, and review any proprietary information produced throughout discovery is an important factor that a trade secret owner and counsel should consider and address in this context. Where information will be produced and stored electronically, mandate the inclusion of safeguards such as encrypted storage, two-factor authentication, and audit logs as it relates to information designated “confidential” or “attorney's eyes only.” With the advent of AI, a protective order should also include language that prohibits uploading “confidential” or “attorney's eyes only” material to third-party AI tools, cloud editors, or other web applications. Finally, trade secret owners should make sure to clearly specify how any proprietary information will be destroyed or returned when the case concludes.

Omega Liner should also serve as a reminder to business owners to be vigilant in developing their intellectual property portfolios. Patents are a valuable tool in an intellectual property portfolio for offensively enforcing rights against potential infringers, but their details become public after the publication of the patent applications. Due to the public nature of patents, great care should be taken to avoid exposing any potential trade secrets in the context of a patent, because their value lies in remaining out of public view. When patent subject matter closely overlaps with trade secret subject matter, there is an inherent risk that the trade secrets may be disclosed—whether compelled in patent litigation, inadvertently revealed in a transaction related to the patented technology, or otherwise. It is important to work with counsel to develop an intellectual property strategy that considers all facets of your organization, so that layered protections can be implemented that will best suit the company’s business and litigation strategies.