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SMS Demag AG v. Xtek

December 5, 2006

SMS DEMAG AG PLAINTIFF
v.
XTEK, INC. DEFENDANT



The opinion of the court was delivered by: Garnett Thomas Eisele United States District Judge

ORDER

Presently before the Court are Plaintiff's Motion for Entry of Protective Order (Docket No. 21), Plaintiff's Motion to Compel Discovery (Docket No. 23), Defendant's Motion to Compel Answers to Interrogatories and Production of Documents (Docket No. 37), and Plaintiff's Motion to Compel Discovery (Docket No. 43). The Court will first address, however, certain deadlines regarding the possible Markman hearing.

I. Markman Hearing Deadlines

The parties are to simultaneously exchange a list of claim terms that they contend should be construed by the Court by January 10, 2006. Should the parties be concerned that such exchange may not be simultaneous, the parties may contact the Court and request that the lists be submitted to the Court, and the Court will send the lists to opposing counsel simultaneously. The parties must disclose expert(s) and serve expert report(s) on issues for which a party has the burden of proof by January 22, 2007. The parties shall complete and file a Joint Claim Construction Statement by February 2, 2006 stating, (1) the construction of those terms on which the parties agree; (2) each party's proposed construction of each disputed claim term with an identification of all references from the specification or prosecution history that support that construction, and an identification of any extrinsic evidence known to the party on which it intends to rely either to support its proposed construction of the claim or to oppose any other party's proposed construction of the claim, including, but not limited to, as permitted by law, dictionary definitions, citations to learned treatises and prior art, and testimony of percipient and expert witnesses; and (3) whether any party proposes to call one or more witnesses, including experts, at the Claim Construction Hearing and the identify of such witness. The parties must disclose expert(s) and serve expert reports(s) in rebuttal by February 10, 2007. If a Markman hearing is necessary, it will occur on February 16, 2007 per the Court's October 18, 2006 Scheduling Order.

II. Background

On April 12, 2006, Plaintiff SMS Demag AG ("SMS") filed the present lawsuit against Defendant Xtek, Inc. ("Xtek") alleging patent infringement, trademark infringement, and unfair competition in violation of federal law, deceptive and unconscionable trade practices in violation of Arkansas statutory law, and trademark infringement and unfair competition in violation of the common law. The parties are competitors with respect to the subject matter of this action, which concerns rolling mill equipment called "spindles." SMS claims that the SMS patent in this suit covers drives for rolling mills that include improved spindles invented and marketed by SMS and which, as SMS alleges, are also being made and sold by Xtek without SMS's consent. On December 1, 2006, the Court held a telephone conference to discuss the motions pending before the Court.

III. Motion for Protective Order

According to Plaintiff's Motion for Entry of Protective Order, the parties agree that a protective order is necessary in this matter to prevent disclosure of nonpublic and sensitive information that will be produced in discovery. SMS's proposed protective order is "two-tiered" in that it separates Confidential and Highly Confidential information. The parties have previously disputed the appropriateness of the proposed in-house counsel and in-house technical expert designees, and the language in paragraph five (5).

As stated in the telephone conference, based upon the declarations submitted by SMS, the Court finds that Mr. Steenken is an appropriate in-house counsel designee and Mr. Malan is an appropriate in-house technical expert under the protective order. Based upon the December 4, 2006, declarations submitted to the Court by Xtek, the Court finds that Mr. Sennett is an appropriate in-house counsel designee and Mr. Petrek is an appropriate in-house technical expert under the protective order.

Furthermore, the parties have agreed to a revised paragraph five (5) of the protective order, which states:

As used herein, "HIGHLY CONFIDENTIAL" material is CONFIDENTIAL material that any party deems to contain particularly sensitive business or technical information. The "HIGHLY CONFIDENTIAL" category may be invoked in good faith by a Producing Party and only relative to particularly sensitive proprietary commercial information related to couplings and gear products. This would include information related to pricing, production costs or other cost data related to the sourcing and/or manufacturing of a party's products, financial projections or profit calculations (including the underlying business information used to create such calculations), and any information related to new product development. No other technical or manufacturing information will be designated HIGHLY CONFIDENTIAL. CONFIDENTIAL information will include all information residing in any of the quote/sales order files, production (finish) files, or engineering (checking) files, except for any information that is classified as HIGHLY CONFIDENTIAL under one or more of the categories identified above as suitable for being so designated. Specifically included in the kinds of documents and information that may only be designated CONFIDENTIAL are drawings of relevant products, organizational charts, lists of employees, and quality or production manuals.

The Court will enter a protective order reflecting its findings and the agreement of the parties.

IV. Plaintiff's Motion to Compel Discovery (Docket No. 23)

The parties agree that this motion should be denied as moot and attorneys fees are not warranted with regard to this motion. Therefore, Plaintiff's first ...


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