Rohm and Haas Co. v. Lin

992 A.2d 132

ROHM AND HAAS COMPANY v. Dr. Manhua Mandy LIN, EverNu Technology LLC, Philadelphia Newspapers LLC and Willow Grove BK.

Appeal of Dr. Manhua Mandy Lin.

Rohm and Haas Company v. Dr. Manhua Mandy Lin, EverNu Technology LLC, Philadelphia Newspapers LLC and Willow Grove BK.

Appeal of EverNu Technology LLC.

Superior Court of Pennsylvania.

Argued March 17, 2009.

Filed March 1, 2010.

Reargument Denied May 7, 2010.

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Hugh Hutchinson, Philadelphia, for Lin.

Andrew Klein and John Chesney, Philadelphia, for EverNu.

Mari M. Gursky Shaw, Philadelphia, for Rohm and Haas, appellee.

BEFORE: BENDER, SHOGAN, JJ. and McEWEN, P.J.E.

OPINION BY SHOGAN, J.:

¶ 1 In these consolidated appeals, Dr. Manhua Lin ("Dr. Lin") and EverNu Technology LLC ("EverNu") appeal from the order entering a default judgment and a permanent injunction in favor of Dr. Lin's former employer, Rohm and Haas Company ("Rohm and Haas"), as a discovery sanction against Dr. Lin. After careful review, we affirm in part, vacate in part and remand for further proceedings consistent with this Opinion. We quash EverNu's appeal.¹

¶ 2 A previous panel of this Court set forth the factual and procedural history of this case as follows:

In the present case, the record indicates that Appellant Manhua Mandy Lin, Ph.D. (Dr. Lin) was employed as a research scientist by Appellee Rohm and Haas Company (Rohm and Haas) from 1989 until November of 1999. Rohm and Haas is a manufacturer of specialty chemicals. Its line includes polymers comprising sic coatings and adhesives. Acrylic acid is a central component and starting material in over 50% of its products.

The specialty chemicals market is intensively competitive. Rohm and Haas contends with many commercial rivals who are seeking to develop new methods for producing acrylic acid. Rohm and Haas, therefore, has funded a costly and continuing research project charged with analyzing and developing methods for synthesizing acrylic acid more cheaply and efficiently. Should one of its competitors develop a less expensive process for synthesizing high quality acrylic acid, Rohm and Haas would be at a serious commercial disadvantage.

Dr. Lin was hired by Rohm and Haas in 1989. On January 3, 1989, Dr. Lin executed a confidentiality agreement that precluded her from disclosing any trade secret information she learned through her work for the company. Specifically, she promised that she would "not divulge such information to outsiders or other unauthorized persons either while employed by Rohm and Haas or afterwards." Confidentiality and Employment Agreement, 1/3/89, at 1, ¶ II. Dr. Lin also promised that, "upon termination of her employment," she would "return to Rohm and Haas all papers, notes, books, or other documents or property belonging to Rohm and Haas or relating to its business." Id. at ¶ VI.

Dr. Lin was promoted in 1995 to a position that gave her access to confidential and trade secret information, including information relating to the catalytic synthesis of acrylic acid. She was one of seven senior scientists in the monomer technology group performing research related to catalytic alkane oxidation. Dr. Lin believed that she was not given proper recognition by her superiors for her work and that this was caused by disparagement of her gender and national origin. She therefore initiated a complaint with the federal Equal Employment Opportunity Commission (EEOC). As a result of an EEOC mediation, Dr. Lin agreed to leave Rohm and Haas in exchange for certain emoluments and termination benefits.

On November 10, 1999, Dr. Lin signed an agreement that specifically stated she could publish scientific papers, but that she could not reveal trade secrets. Her right to publish was subject to review concerning trade secrets by Dr. Scott Han, an employee of Rohm and Haas. In the event of a disagreement between Drs. Lin and Han, Dr. Charles Tatum, the Chief Technology Officer for Rohm and Haas, was authorized to review the disputed matter. EEOC Settlement Agreement, 11/10/99, at ¶ 7.I. Anticipating Dr. Lin's separation, Rohm and Haas issued a document captioned "Departing Employee Notice and Acknowledgement of Continuing Obligations." This document delineated the manner in which confidential information was to be handled upon termination of Dr. Lin's employment. The parties executed an additional agreement which specifically acknowledged that Dr. Lin remained bound by the confidentiality agreement she signed on January 3, 1989, and that she also was bound by the confidentiality requirements of the "Departing Employee Notice and Acknowledgement of Continuing Obligations." Agreement and Release, 11/15/99, at 3, ¶ 13.1

The trial court found that, despite the requirements of the various confidentiality agreements, prior to her departure from Rohm and Haas Dr. Lin copied hundreds of confidential documents onto high-storage-capacity computer disks, which she took with her. She also removed reference books belonging to Rohm and Haas.

1 The Agreement and Release is dated November 15, 1999. It was not executed until November 17, 1999, by Dr. Lin. A representative of Rohm and Haas executed the agreement the following day. Dr. Lin alleges that Dr. Tatum was removed from the reviewing process by agreement via a revision in the Agreement and Release. Dr. Lin's Brief at 9. However, neither the certified record nor Dr. Lin's reproduced record supports this assertion. See Agreement and Release, 11/15/99, at 2, ¶ C.5.h and Dr. Lin's Reproduced Record, Volume V, at 2238 (reproducing the Agreement and Release).

Dr. Lin had committed to delivering a scientific paper to the American Chemical Society (ACS) in March of 2000. Dr. Lin submitted an outline of her intended presentation to Dr. Han a few days before the meeting. However, Dr. Han did not have enough time to do a complete trade secret review. He therefore authorized presentation of the paper subject to the caveat that only 1996 or previous data could be used. This proviso was required because post-1996 data included critical documentation that constituted confidential trade secret information.

Dr. Han and another Rohm and Haas employee (Dr. Anne Gaffney) attended the 2000 ACS meeting. On March 28, 2000, Dr. Lin gave a presentation using post-1996 trade secret information concerning the catalytic synthesis of acrylic acid. It is customary in the scientific community to publish a paper conveying the substance of a presentation following the meeting at which the presentation was given. Rohm and Haas scientists were concerned that Dr. Lin would disclose additional trade secrets in her follow-up paper in order to better substantiate her oral presentation.

Although the certified record amply documents the specific confidential data concerning catalysts disclosed by Dr. Lin at the March 2000 ACS meeting, it would be inappropriate to detail that information in a judicial memorandum that is a matter of public record. Suffice it to state that we have scrutinized the record carefully and have found evidence of record that supports the trial court's determinations. See, inter alia, N.T., 2/26/01, at 10-67 (comprising the testimony of the Chairman of the Department of Chemical Engineering at the Pennsylvania State University to the effect that the information at issue in this case constitutes non-public data which is not generally known in the relevant scientific community that would be of value to a competitor of Rohm and Haas). We note additionally that the record indicates Dr. Lin did place additional trade secret information in her proposed paper. See N.T., 2/26/01 (Volume II), at 11-12 (comprising the testimony of Dr. Han concerning the draft of Dr. Lin's paper that he approved and the additions incorporated by the subsequent draft that Dr. Lin did not submit for Rohm and Haas approval).

Scientists at Rohm and Haas received notice that Dr. Lin was scheduled to present at an international symposium on oxidation catalysis in September of 2001. Rohm and Haas applied for a preliminary injunction to prevent Dr. Lin from disclosing further trade secret information and to require her to abide by the agreed upon trade secret review process pending a final ruling. The trial court conducted ten days of hearings. On April 17, 2001, the trial court entered an order granting a preliminary injunction in favor of Rohm and Haas. The order specifically included the following:

1. Dr. Lin is enjoined from using, disclosing or divulging, directly or indirectly, any information that Rohm and Haas considered confidential or trade secret;

2. Dr. Lin is enjoined from making, releasing or disclosing any proposed scientific presentation or publication unless, after a 90-day trade secret review by Dr. Scott Han and/or Dr. Charles Tatum, the parties agree that such presentation or publication contains no Rohm and Haas trade secrets.

Order, 4/17/01, at 2. The trial court also directed that the preliminary injunction would remain in effect until the final hearing of the case. Id.

Dr. Lin filed a motion to dissolve the preliminary injunction, which the trial court denied on April 26, 2001. Dr. Lin's timely notice of appeal followed on May 7, 2001.

Rohm and Haas Company v. Dr. Manhua Mandy Lin, 1246 EDA 2001, unpublished memorandum at 2-7 (Pa.Super. filed February 20, 2003). On appeal, this Court affirmed the order entering a preliminary injunction against Dr. Lin, stating: "We conclude that the preliminary injunction entered in this case represents a balanced response to the evidence of record. We see no indication of legal error nor do we find abuse of discretion." Id. at 21.

¶ 3 The trial court updated the procedural history of this case in its 1925(a) opinion as follows:

Thereafter, Rohm and Haas sought various additional discovery from Dr. Lin, in support of its underlying equity action and to enforce the preliminary injunction. In

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