American Tobacco Co. v. Evans, 2341
| Decision Date | 29 April 1987 |
| Docket Number | No. 2341,2341 |
| Citation | 508 So.2d 1057 |
| Parties | , 55 USLW 2635, 2 U.S.P.Q.2d 1866 The AMERICAN TOBACCO COMPANY v. The Honorable Gray EVANS and Ella Mae Howard Horton, and Nathan Randall Horton, Widow and Son of Nathan Henry Horton, Deceased, Individually and on Behalf of All Wrongful Death Beneficiaries of the Deceased. Misc. |
| Court | Mississippi Supreme Court |
James E. Upshaw, Upshaw, Williams, Biggers, Page & Kruger, Sanders & Sanders, Greenwood, Edmonson, Biggs & Jelliffe, Jackson, for appellant.
Jack F. Dunbar, Janet G. Arnold-Wilson, Holcomb, Dunbar, Connell, Chaffin & Willard, Oxford, Don L. Davis, Byrd, Davis & Eisenberg, Austin, Tex., Calvin R. King, Durant, Don Barrett, Barrett, Barrett, Barrett & Patton, Lexington, Fredrick B. Clark, Greenwood, Edwin Lloyd Pittman, Atty. Gen. by Robert L. Gibbs, Asst. Atty. Gen. and Al Nuzzo, Sp. Asst. Atty. Gen., Jackson, for appellees.
ON PETITION FOR WRIT OF PROHIBITION
This case presents a sensitive question of first impression in this state: the discoverability of a manufacturer's trade secrets and other confidential research development or commercial information. For the reasons articulated below, we hold that, in the context of the facts and circumstances of this case, such information is discoverable by a party opponent, subject to a carefully drawn protective order prohibiting disclosure to unauthorized persons.
This matter arises in the context of a civil action pending in the Circuit Court of Holmes County, Mississippi. In that action, Ella Mae Howard Horton and Nathan Randall Horton, (collectively "Horton") widow and son of Nathan Henry Horton, deceased, claim to be the wrongful death beneficiaries of Nathan Henry Horton. They have brought suit against the American Tobacco Company and a distributor of its tobacco products, alleging, inter alia, that Horton developed and died from lung cancer caused by smoking "Pall Mall" cigarettes. Plaintiffs seek substantial compensatory and punitive damages. The case has been set for trial on August 31, 1987.
On May 9, 1986, Horton served upon American written interrogatories, among which was Interrogatory No. 8 which reads:
8. Please identify, by scientific name, generic name and chemical formula, all additives, chemical or otherwise, in Pall Mall cigarettes and its wrapping paper, and;
(a) State whether or not each additive or material has ever been determined or suspected to be carcinogenic, cocarcinogenic, a tumor initiator, or to yield nitrosamines;
(b) Identify tests, analyses, or research you have conducted, or had conducted on your behalf, to determine the properties and/or health hazards of each additive or material.
On June 27, 1986, American filed its response objecting to Interrogatory No. 8 on several grounds, including that the information sought is confidential and proprietary and is irrelevant to the issues raised by Horton's claims.
On July 30, 1986, Horton filed a Motion to Compel American to disclose, among other things, the information sought by Interrogatory No. 8.
On August 13, 1986, American filed its Opposition to Plaintiffs' Motion to Compel. The Opposition was fully supported by an affidavit which established, among other things, that (1) "Pall Mall" is one of America's most popular brands of cigarettes; (2) "Pall Mall" cigarettes consist of flue-cured tobacco, air-cured tobacco, oriental tobacco, humectants, proprietary flavorings and paper wrapping; (3) American has never revealed so-called "additives" since it began manufacturing "Pall Mall"; (4) American enforces strict procedures to insure continued secrecy, including, but not limited to, (a) maintaining the formula books in a vault, (b) limiting access to such information to twenty employees, each of whom is bonded, (c) limiting the times these employees have access to the formula books, and (d) maintaining a written record of the period during which each of these employees has access to such information. The affidavit also established that certain of the flavorings used in "Pall Mall" cigarettes are purchased from outside "flavoring houses" that demand, as a contractual condition to such sale, non-disclosure of the contents of the flavorings. In short, American argued below, and here, that the identity of the ingredients of "Pall Mall" cigarettes is highly valuable proprietary information which, if disclosed would result in substantial economic injury to American. Revenue from the sale of "Pall Mall" cigarettes in the United States is said to account for a substantial portion of America's tobacco related income. American argued further that disclosure under any circumstances of the proprietary ingredients would jeopardize "Pall Mall's" unique flavor and characteristics and, as a consequence, would imperil "Pall Mall's" marketability as a competitive tobacco product.
In January of 1987, the Circuit Court announced that it would require American to disclose the "additives." Disclosure in fact was stayed pending submission of proposed protective orders, see Rule 26(d)(7), Miss.R.Civ.P., and on April 7, 1987, the Circuit Court entered a Protective Order requiring American to disclose the identity of the ingredients of "Pall Mall" cigarettes under certain conditions of protection. The protective order reads as follows:
On January 13, 1987, this Court entered an order directing the defendant, The American Tobacco Company, to answer in full Interrogatory No. 8 propounded to it by plaintiff. The information obtained by plaintiff as a result of American's answer is subject to the following protective order;
Such information shall not be disclosed to any third persons except that plaintiff's counsel may disclose such information to experts either retained and being consulted by plaintiff's counsel when plaintiff's counsel, in good faith, deems disclosure to such persons to be necessary to the preparation and trial of this case. The person or persons to whom such information shall be given shall under no condition supply such information to any other party without the written permission of this Court. Each person to whom such information is given shall be given a certified copy of this order and the disclosure of this information to any other person without such written permission shall subject the person giving such information to any other party to the penalties of contempt of court.
All persons in possession of the information provided shall maintain such information in a secure, enclosed storage receptacle, except when the documents are in use.
No person in possession of the information provided shall make such information available to any other person.
No person who is supplied with the information by plaintiff's counsel shall make or cause to be made any copies of any documents which contain the information provided.
American Tobacco shall furnish this information to Plaintiffs on or before 1 p.m. April 14, 1987.
ORDERED AND ADJUDGED on this the 7 day of April, 1987.
American now applies to this Court for a writ of prohibition, in effect seeking reversal of the Circuit Court's disclosure order.
The writ of prohibition exists in Mississippi as a common law remedy modified and controlled by Section 11-41-1, et seq., Miss.Code of 1972, as amended. Pearl River Valley Water Supply District v. Brown, 248 Miss. 4, 25, 158 So.2d 694, 695 (1963). The writ initiates an extraordinary proceeding traditionally geared to prohibit an inferior judge or court from exercising its jurisdiction improperly. As noted by this Court, however, its modern use is broad and encompasses
... situations where, even though the inferior court has jurisdiction, the superior court deems it necessary and advisable to issue the writ of prevent some palpable and irremedial injustice.
State v. Maples, 402 So.2d 350, 351 (Miss.1981). See also Fondren v. State Tax Commission, 350 So.2d 1329, 1332 (Miss.1977); State ex rel. Pittman v. Griffin, 450 So.2d 426, 429 (Miss.1984) (); Crittenden v. Town of Booneville, 92 Miss. 277, 45 So. 723 (1908). 1
Quite clearly, while discovery controversies do not commonly fall within this category, questions such as the alleged "trade secret" status of discoverable material risk great and irremediable harm if left unsettled until conclusion of the case. In sum, we hold the procedural vehicle chosen by American appropriately vests this Court with jurisdiction to address and settle this question.
We begin with the basics. We regard American's right to the information in question as a "property right" not because it seems so but because our law decrees it so. 2 See General Chemical Corp. v. Department of Environmental Quality Engineering, 19 Mass.App. 287, 474 N.E.2d 183, 185-86 (1985). Property, a creation of law, is not defined by reference to a dictionary or any supposed common sense notion, nor is it a function of value. Property is a tangible or intangible that which our law protects from interference. International News Service v. Associated Press, 248 U.S. 215, 246, 39 S.Ct. 68, 75, 63 L.Ed 211, 223 (1918) (Holmes, J., concurring). But see E.I. DuPont DeNemours Powder Co. v. Masland, 244 U.S. 100, 102, 37 S.Ct. 575, 61 L.Ed. 1016, 1019 (1917). Trade secrets possess enough of the attributes of property to be subject to security interests as general tangibles. Miss.Code Ann. Sec. 75-9-106 (1972). Suffice it to say that our law grants American great protections from interference with or access to the information at issue. See Electric Reduction Company of Canada, Ltd. v. Crane, 239 Miss. 18, 31-32, 120 So.2d 765, 770-71 (1960); Cataphote Corporation v. Hudson, 444 F.2d 1313, 1315-17 (5th Cir.1971). Neither the curious nor the meddlers nor the do-gooders may invade American's property right absent some (for the moment) superior right also emanating...
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