Case of the Day: Andover Healthcare v. 3M
Posted on May 24, 2016
The case of the day is Andover Healthcare, Inc. v. 3M Co. (8th Cir. 2016). Andover and 3M were competitors in the market for latex-free bandages. In 2013, Andover sued 3M for patent infringement in Delaware and in Germany.
Andover’s European patent (EP 1 027 084 B1) claimed “a cohesive product comprising … an inherently crystalline elastomer and at least one tackifying agent in an amount effective to disrupt the crystalline structure of the elastomer and maintain the elastomer in a partial polycrystalline state.” In the German case, 3M’s expert opined that 3M’s elastomers “are not present in a crystalline … state,” and thus that 3Ms products could not infringe the patent. Andover did not believe the expert’s test results could be correct and asked 3M to provide samples of its materials to allow Andover to do its own tests for use in the German case. But 3M refused on the grounds that disclosure would compromise its trade secrets. 3M had previously disclosed the information for use in the Delaware case. But the Delaware court refused to modify the protective order to allow use of the information in the German case, and the German court had not yet ruled on Andover’s request for discovery. So Andover sought the information from 3M for use in Germany by way of § 1782. A magistrate judge denied its application, and the district court affirmed. Andover appealed.
The court affirmed, holding that the lower court had not abused its discretion. The first Intel factor weighed against Andover, because Andover was a party to the German case and “the German court had said it would grant Andover’s discovery request if necessary to resolve the case.” The court also noted the lack of assurance that confidentiality could be preserved in Germany. This is a highly important practical point in § 1782 cases in European patent litigation in particular. In some foreign tribunals there are insufficient procedural mechanisms for assuring a US court that once the materials are produced they can be used in the foreign tribunal without opening them to public inspection. Last the court focused on Andover’s “apparent attempt to avoid or preempt an unfavorable decision on discovery by the German court,” which raised comity concerns. The receptivity and circumvention factors under Intel favored discovery, but not enough to suggest that the district court had abused its discretion.