and the next case will be the pot versus cohen industries mr quinn morning your honor some may please the court the fundamental problem with the proceedings that produce this massive damages award an unprecedented twenty year global shut down injunction is the failure to identify specific trade secrets and the degree to which those specific trade secrets above and beyond what was publicly available information allowed cologne to improve it preexisting production process in a way that produced true unjust enrichment but no matter how many times cologne insisted that the proceedings go trade secret by trade secret and no matter how many times alone insisted  absolutely necessary to take into account publicly available information including the information publicly disclosed in the act so litigation and how many times they did that the district court would hear none of it missed and then i hate to break train but maybe i can't break  i appreciate that what i would say to judge davis in particular is in thinking about the judgment that the district court made if the district court made an error of law in assessing the significance of the acts of litigation to the trade secret case for example that seems something that this port would have to correct so if he thought that the acts of litigation was tangential based on a misunderstanding of the legal principles and the relevance of the acts of litigation to the trade secret case that would seem to be something this court would have to review that it makes question i think ultimately it's a pure question of law but and but but let me sort of take you to specifically what i have in mind which is if you look at page nine of our  the top illustration is in the national archives is publicly disclosed the bottom illustration is the only documentary basis for trade secrets two through six now if you look at those two documents they are awfully similar and the judge is explanation for why he was going to exclude reference to the axle litigation is that well the top illustration did not disclose the trade secret in its entirety and that is simply legally because for two reasons one a more general reason one a case specific the more general reason is the burden is not to say that if something has not been publicly disclosed a trade secret has not been publicly disclosed in that the public disclosure is not relevant the public disclosure is still highly relevant for multiple issues in the case as mr canard pointed out it is highly relevant for whether or not the trade secret has independent economic value because of ninety five percent of the cat's out of the bag the five percent doesn't have independent economic value it's also relevant to the reasonableness of the measures dupont had to keep the matter secret because if this secret is in the national archives that's certainly not a reasonable effort to keep it secret but perhaps most odd if nobody goes to the national archives well i think there are certain things that are just the public domain and i'd start with the national archives probably but here's the thing where i think the easiest way to show how it's got to be relevant is and this bleeds over into the in that the mistakes on the damages and in the injunction but when you get to the remedial phase this court's cases most clearly it serve a case makes clear that the inquiry is essentially a marginal one you have to say look they miss if they misappropriated something they took a short cut they got something and they save some money over what over what they would have been able to do if they had relied on information that was publicly available or reverse engineering things that did not involve misappropriation so you have to compare kind of the margin or the delta between what was the alleged trade secret and what was in the public domain so those are all reasons why it was erroneous to say that the acts of litigation was not relevant just because the document didn't disclose the trade secrets in its entirety here's a case specific reason why it's even more clearly relating relevance to the matter in controversy for purposes of the recusal motion i mean it sounds like you're on the merits of whether the or here and not allowing that evidence to come in for the jury to consider whether or not a trade secrets have been publicly disclosed those the same as i guess what i was testing is to the extent the reasoning of the district court is well you know this isn't a matter of controversy because it's because you know it's it's barely relevant at all and it's you know has nothing to do with this case if that determination is based on an erroneous legal conclusion then it seems to me that you have to look at the matter in controversy then based on the correct legal principles and this just underscores h central the axle litigation was especially to the trade secret case the other thing of just to finish my thought on the case specific reason why the treatment of that top document on page nine is so problematic the district court says well the in the national archives doesn't disclose everything in trade secrets to through sex and specifically what i think the district court had in mind is that if you look at the trade secrets as a numerated in the juror notebook there's four parameters specified for certain of the of the machines and talk a little bit generally is one public session but there's four parameters specified and the judge says well if you look at the top document only one of those parameters is specified well the exact same thing is true of the bottom document the document that cologne got from one of the consultants also discloses the exact same parameter and doesn't disclose the other three parameters alleged in one of the trade secrets in the journo book so it cannot be that you can't look at the top document and the jury can't even see the top document because it only discloses one parameter when the very document that's the basis for these trade secrets likewise only discloses one parameter if there was any problem with the disconnect between what was in the document the clone received and the trade secrets in the journo book that should have been a sufficiency the evidence problem i mean if they really had a disconnect between those two but it can't be that there's no disconnect for purposes of evaluating their evidence but there is a disconnect for evaluating the real relevance of that top document from the acts of litigation now if i could sort of broaden the lens and as i suggested i think the real problem here was all of that just a mistake i just talked about probably would have been much more evident if this case had been adjudicated the way that this court and virginia supreme court cases suggest a trade secret case should be adjudicated which is trade secret by trade secret with each element of each trade secret very carefully define but the department of strategic judgment in this case they don't want to bore the jury so notwithstanding the fact that one hundred  forty nine trade secrets they really tried to essentially try them on months and that created several problems throughout the case but we focus your attention on the damages and the injunction because there as i very specific but that's why you have an opportunity to amend your complaint after you get the center made it in by the government isn't it true sometimes additionally judges faced with a lot of claims and not each one is given full full breath in the courtroom and it mean the judge has to sit there and let there be evidence of fifty thousand claims he put in over six years i mean that there is some management of the courtroom that the judge can do is absolutely your honor but it can't come at the expense of proving every element of fifty thousand trade secrets i want to try for your honor i think the proper response is get out here come on i mean let's boil this down they've got i would look for way to recuse myself if that would be that would be the right first call but then i think the second call would be to say look you know nobody's misappropriate this this was sixteen documents seven hundred fifty pages on the technical side now when you get sixteen documents in seven hundred fifty pages i suppose you can divide that up in one hundred forty nine trade secrets or sixteen categories which they originally did but i think the district court's got to say look you got to make this manageable help me make this manageable but not at the expense why we have the westward missions what's your honor isn't that why we have requests where the missions i mean colin could have could have narrow the universe here but we asked them to and we asked for in our you know in our in iraq towards we asked what are the specific trade secrets here and we were given sixteen categories that then were later after discovery close put together in two hundred two trade secrets was then dropped to one hundred nine or whatever it was well we couldn't get the specificity that we were looking for even to this day i guess the reason i'm raising requests for admissions is because you get to formulate the specificity in a request for admission and it's either admitted or denied and you can do it in the form of a factual question and that's but with respect honor it's not our burden to frame their claims these aren't these aren't just factual matters these are their claims i mean for ginia  and each trade secret you have to satisfy every element i think that is your argument that had you been able to get the information you wanted then you may be able to frame requests for admission and that that's a very fair way to put it judge said and i would say that the problems here were not just with the merits face it also spilled over into the remedial faces because not having proceeded trade secret by trade secret but really having lumped all of this information together then when it came to damages with a damaged theory follow that directly but we think the damage there was fundamentally inconsistent with this court's decisions and servo and spirit rand because what their expert did is instead of looking at individual trade secrets and saying ok by getting this trade secret instead of get us from the public domain you save x amount of money instead they basically calculated the acquisition costs and then which you know aren't the right thing to be focused on and then they refused to make the adjustments necessary for that proxy to have any fit whatsoever w traits but i know you go but you presented evidence that they rejected but but but it's not just a matter of he said she said in the jury gets to decide the jury doesn't get to decide based on a being fundamentally in missing structed which we submit they were because they were told unjust enrichment but without the critic factor that we tried to get the judge to add which is it's unjust enrichment viz of the what's available in the public domain and without that it's critically mistaken inquiry and then the other point i would say is the jury also can only make this determination if it's based on reliable expert evidence and we challenge the droz report because it really is the assumptions in that report are fundamentally unreliable and the best way to illustrate it is if you're going to use their development costs that include all their development including the products that led to the research that led to patents you have to make some adjustment for that this is a case where the trade secret documents sixteen documents seven hundred fifty pages well du pont through the same research that clones been basically told to pay for generated seven hundred thirty pure air made pacts now their response when they said well look you just pay for all this publicly disclose stuff is to say well it's too hard to sort of factor that out well if it's too hard to factor that out you can't use this methodology at all it's not like well i've looked at a completely different number and in order to adjust that i need to make certain adjustments but the adjustments are too hard if that's the case that doesn't mean you're excused for making the adjustments that means you have to go about it differently and we didn't do it for the defense of an obligation to make at least make the argument with respect to the adjustments your client and we did when  excretory rejected that yeah but but again it isn't we don't lose our challenge because we tried as a second best alternative to make an argument to the jury that was rejected and you know and i think you win some but you don't get to stop the game then you get to keep playing ball whatever the rules are nails and absolutely absolutely you got to move to your second best argument if you know you think this they're experts can go on there at all well when you lose that the next thing you do is you put your expert up your expert does it the right way and one of the pernicious things that's been suggested here is our expert said their methodology was fine that's completely wrong if you look at the two expert reports they are they are miles and miles apart all our expert said is yes avoided cost and unjust enrichment  relevant concepts but it's avoided cost these are the what's in the public domain and that these of the what's in the public domain is what's missing from their approach if we were persuaded that you were prejudice your client was prejudiced we plausibly remain for  damages only if you think that would be totally unfathomable i don't think that would work in this case and i think it wouldn't work for this case largely because the damages and the all or nothing you know shut down injunction are all of a piece with the way the case struck so i think that you know if you were to vacate damages vacate the injunction but try to hold liability i think that the second jury would be in a very difficult position they don't most i think to get the damages right in the injunction right you'd have a completely different case being adjudicated and i think that would violate seventh amendment principles and they get the you know it's an old chestnut but i think it's still good law the gasoline products case is you can't just sort of have the let me ask you this  is one of the situations where you know any time get a damages verdict this large and a judge in this overbroad it suggests something went profoundly wrong and i don't think what went profoundly wrong was limited to the remedial woman going on with respect to the trade secret issue in the public disclosure as i recall of that fact that it most forty some odd of these trade secrets that you were claiming your clients claiming were in the public domain if we agree with you with respect to that is that taint the other hundred some odd trade secrets that there was no evidence presented with respect of this well i think it would your honor in the following respect which is to the extent we got to the point where we had a different understanding of what the public disclosure meant even if that if there were other trade secrets where that didn't directly affect that trade secret it would still go to other issues in the case for example the reasonableness of the steps that dupont had taken to preserve the trade secrets because if closely related trade secrets are being disclosed in the national archives the that that's not an issue that's really a trade secret by trade secret alone i think that if she would infect the others the other thing i would say is that if let's let's just take a number like forty if you knocked out forty trade secrets from this case the damage is theory and the and in the injunction fall as a matter of one satisfy the virginia statutory standard and the coal on used each one of these straight secrets mr clements argument and collines argument generally in this case that the trade secrets were tried and mass is simply a fiction of their imagination and they testified at length about the entire process of creating kevlar from start to finish from the very beginning to the very end they testified how what happened at each step of the process they had done a five the trade secret almost always by number as they were describing that they describe why that information was secret it was not generally known each step of the process from earliest steps of pre publication through spinning and and the finalization of the process  clements argument though is that i don't think he concedes that that's the way it went down at trial but they argue that this was an ongoing process from the beginning of the case through trial they were faced with a moving target with respect to these trade secrets and could never adequately prepare to defend the case as a result what's your best answer with respect to that there are two responses first of all that's flatly footfalls one of the reasons that we to dupont had trouble however was misconduct in this case not only the spoliation which i'm sure the corps aware of after the complaint was filed the dupont correct hercules and efforts assisted by by the district court to get cole on to reveal the details of what had been destroyed and produce documents that have been able to be recovered but also they're they're resisting discovery throughout the process so the part of the reason for the delay in providing information if there wasn't a delay what lays a collage feet and not participating in discovery as every party in under the federal rules required to do so but their claim is simply not true if you look at the second supplemental in there in iraq a tourist spots it begins a page forty three thirteen of the appendix it goes into excruciating ten and then before trial was originally to be in the spring before it got delayed in february two thousand and eleven had yet another discussion and the interesting thing is what's well but isn't that the point that it kept changing or it well it didn't have the will in changing there was additional additional detail and information that was at it but there was that the basic trade secrets that were alleged were the same from the beginning with the exception of the few that were that were made it along the way but the interesting thing about collage briefs is they don't argue or let alone demonstrate that they were prejudiced a trial in any way by not by the by any sort of late disclosure which i said i think is in their imagination of the trade secrets they didn't at the time of trial they knew what these trade secrets work and you know judge payne was actively managing this process he you know he was all over the definitions of the trade secrets and whether the trade secrets were adequately defined discovery was well within his discretion in when he ruled that that they were of time of if the court is terms that recusals necessary in triggers the time is after severance that we would just say that they've waived that the purpose of the trade secrets case by not arguing their brief but otherwise i will leave them to that was more than fifteen seconds and i believe that mr  i do want to talk about the so called public information in particular page nine of their reply brief there is no doubt that there is a lot of public information about power are amid out there but the fact of the matter is if you assemble the manufacturing plants based on the public information like collage before they store trade secrets you could produce a power image fiber that nobody would want to buy that was not of sufficient quality this these fibers are used in all the proof vest body armor tires brakes and other safety conscious materials and that's that was cost problem is that they could not get from the general  car and that i tried as i understand it the argument here is that with respect to damages the argument is that you recover damages for stuff that was in the public domain and that's how the jury arrived at the nine hundred nineteen million or whatever it was that you judge davis you've said what their argument is the problem is it's not it's contrary to the evidence at trial or at least if you put more precisely the jury had contrary evidence on which they client had put out there well know what so you don't dispute that you're not entitled to cover anything for any of that well with the i think what the dupont witnesses testified and on which doris ace has damaged was that  what they did was they did research and development over thirty years that aimed at creating a product and once they had the product they said how are we going to protect this product this is part of it but did they produce any w bug so along the way they did not and that was that's the point maybe that was a poor analogy but the point is that what they said was they come up with a product integrated in a related product very complicated as you can see from i mean this the chart on page nine is a very small part of the entire process they came up with this integrated in a related product and they said how we're going to protect it some parts are some aspects of some parts we will put in patents and some parts will keep us trade secrets with the testimony at trial was from the fact witnesses on which the damages expert based as testimony was that that was a unified body of knowledge that was created you can't separate he said the fact is that you can't value the information that ultimately went into the patents way that would set measure this by saying then the thirty years worth of development that everything that was needed for your final product was known from day one or day two no no of course not do you had research that didn't get you to your final product and that's part of the trade secret show argument that some information along the way because it by the way us makes sense to me you would have thirty years worth of research to get this product if you could get to it day one of well nobody would do that and so for that information as judge davis is asking as he i think outlined the argument we were there see me that it would be some information in that thirty years that it is helpful but it's not political but chit at the time you develop did you didn't know it wasn't going to be quote your honor that is a hypothetical which may be true maybe not be true didn't present a single piece of evidence that was the case is that you say and i got that from you information you got start from graft from start but it doesn't make sense your analogy would indicate that's not true and it just doesn't make up i don't care what expert says if you can use common sense don't you then the jury always instructed on common sense well that's true but this was an expert testimony this was the witnesses this was the baron more in the other tech that make any difference well it doesn't have to you don't have to accept any witnesses testimony that's a good judge the jury doesn't have to but it may and the point here is that coleman did not present any evidence and i had no no no but that's not the point the point is i don't know if it's true or not i have to look at this only as very fine point but it makes a difference what somebody says and what they make sense if in fact the instruction of the judge's ruling on how you go about assessing damages and the evidence to do that properly if that's not they are in the jury may accept it but the jury's result wouldn't be legally correct well i think are legally authorized i think this is a factual issue not instructions issue that is to say what wouldn't what dupont's witnesses testified was that in order to get to the high quality product that people want to buy you need to start the research from ground zero taking the public information doesn't get you anywhere you need to do the whole thirty years nine hundred million dollars the hundred some odd million dollars a research now colon so you're saying that your expert show witnesses could have taken twenty five years for the research the saved me five years or ten whatever that they didn't do that not a single call on employee current or former testified to say that or anything else in this case so if i understand your argument you're saying if you take one hundred forty nine trade secrets you could put one hundred forty of them in the public domain and ultimately prove only and you still get nine hundred nineteen million dollars is that is that your argument to out do i get that right i'm not sure that's the precise argument no i think that what how how how of what i said how did what i just say differ from what you're saying to us that well for example if you had not that he only had one trade secrets that were limited to take a part of the process it may well be that the cost of developing the process start to finish was was lower in the hypothetical but that wasn't the case here one hundred forty one trade secrets were spanned the range of the and they had their experts testify regarding information the public domain supposedly covering these these trade secrets and the if you look going back to page one of their reply brief the problem that they had look first of all they say these two charts are similar well pepsi or similar also that doesn't mean that coke doesn't have a this because i'm getting old in the bottom left hand corner just one example there is a little box that has what looks like a sideways or the infinity sign that has two parts of the process that are trade secrets that are not disclosed in the ad that i couldn't a jury be interested to make that determin a specific trade secret anywhere in there and they were able to do that and their appellate brief here they have thirty thirty thousand words and they didn't point to a single this is the best they could come up with is not a single proof in their dimensions of things that's the trade secret let me ask before you run out of time why isn't lost profits the better and primary measure of damages in this case and why was that presented to the well last prophecy is a virginia legislature adopted uniform trade secrets act that has alternative measures of damages and one of the measures permitted under virginia law and under the uniform act more generally is unjust enrichment damages and that's what was pursued here with a case to say uniformly it's unjust enrichment damages are the costs of replicating the trade secrets and and that's what dupont proved here and you know kolob makes the argument that somehow this is not permissible under a virginia law or that you have to be shown the org you is part of your argument in taking this that there's something in in the public domain or at least arguably in the public domain that is still too big you are allowed to use whatever that process information is as part of your measurement of unjust enrichment do you claim then no we don't we claim is the cost of replicating these trade secrets that is that what's in the public domain is that part of replicating what you call a trade secret well because you because you said is that whole thirty year process it's a thirty year that's right and so is any of that thirty year process something expert making this up on his own was that if were to replicate the trade secrets you have to do all that research that he's only spawn off some information that went to a pad that you don't save any money by starting with the patents and then going to the trade secrets is how that may go ahead i mean in a apologize that judge gives it is there or is there a conflict between unjust enrichment damages and a twenty year injunction there isn't there isn't there is not and the reason is but isn't that the damages awarded based on unjust enrichment doesn't that make you whole and i see colin bought has been they paid for what they stole now well and in fact they haven't paid for it they did not the admission ticket the price of admission for the making that argument is paying the judge and i understand that i understand and it's oath so i understand it or not but i mean it but i mean it how do you pay the judgment  take fifty five in the seventh circuit explain this in three at the unjust enrichment damages you're back with looking you stole or trade secrets when you steal them you owe us the amount that it cost to replicate them and the injunction is forward looking to prevent further harm that's not taken into account for example here you know they have this information of our first of all i'd also say your honor the only the only challenge one aspect of this injunction and that's the production injunction they don't challenge the use injunction they don't challenge the requirement that they return our documents extent the trade secrets are reflected in the documents they don't trust the disclosure of it so we're really talking about a very limited set the difference between the use and the production injunction and what judge payne said based on a plethora of evidence in the record was that they couldn't be trusted just with a use injunction not to not to actually produce it and that's the difference is that we would be continually harmed that's not reflected by the damages award if an injunction were two parties about whether this really went trade secret by trade secret or not we were told by judge payne numerous times that he was tired of us complaining about it not going trade secret by trade secret so we really do think we have the better of the argument if you going to look at something just as an example of this i'd ask you to look at joint appendix eight four zero five three eight four eleven that's where seventeen trade secrets were dealt with in those six pages and they were dealt with base they really were dealt with on mosse the economic value w all teen was based on testimony about information derived from a handful of documents in terms of the two points also kind of about the way the case was tried the moving target point i mean to be clear it went from sixteen categories but not to this day i have to be honest i have no idea whether they're all timid theory is the trade secrets or what's in the journo book or what's in the documents themselves because they went back and forth on that in the post and they were saying no it's not just what was in the notebook it's really what the documents that cologne got in from the consultants but then when you look at the injunction the injunction incorporates by reference which is a rule sixty five allegation but that but the injunction incorporates by reference to juror no so this is been a moving target from the beginning to the end in terms of the ruling about the relevance of the x o litigation i think as your colloquy with with my friend showed the district court clearly put cologne to an impossible burden he says well at no point did cologne show that the documents in the act so that a geisha disclosed a trade secret well if the publicly available documents in the archives disclose something it's by definition not a trade secret and course of they knew what was in the public disclosures in the a litigation so when they're trying to formulate their hundred forty nine trade secrets i mean this is like a pattern where you know you kind of know what the intellectual property is beforehand they get to craft these hundred forty nine trade secrets well they can try to craft them around what's been publicly disclosed and in that sense you know unless they're doing their job very poorly it may be hard for us to point to a public document that has the trade secret they're alleging but when you have information that's highly relevant that's you know  what you can find differences between those two charts on page nine of our reply brief but you have to look pretty hard and half of the difference is cut in the other direction which is to say there's more information in the public document than in that alleged trade secret document that's clearly something i don't know how a jury can decide whether that bottom document is trade secret or the basis of five different trade secrets without getting a take even a peek at the top documents now let me talk about the remedies before i sit them on to damages i think the discussion with my firm was very clarifying because as he put it this is not a case where my client had nothing and then acquired trade secrets and then all the sudden had something in that case you might be able to at least meaningfully talk about these broad remedies either a complete shutdown injunction or kind of an all development cost damages word but that's not the case this is a case where as they admit we had something before based on publicly available information and if you go back to the beginning their complaint of course this case looks much different from what the complaint says look at paragraph fifty seven of their complaint when they are talking about what they want in terms of relief they are talking about the fact that we got unjustly enriched because we improved the quality of our product faster than we would have been if we had misappropriated these traits it's all right that's right that's how you measure damages but that doesn't allow you to get thirty years of development part of which led to seven hundred thirty patents in the public domain you have to look at the margin and that's just not me saying it this court said that in the service case so then in the injunction again here i think it's very important to recognize that we did have this existing production facility we were able to as my friend indicates put that together based on two things publicly available information and in equipment that we bought off the shelf from foreign manufacturers so this is not like the coca cola trade secret where they put all their eggs in the trade secret basket they also used the patent system information was available maybe we couldn't produce ferrari's but we could produce something so in that context to have a shutdown of all production is completely overbroad in terms of a remedy the other thing i would say is you suggest well what was in the public domain in these patent disclosures is just very poor quality but that's not what they told the patent office when they got these patents that had to be novel improvements over the prior art so i would dispute that but