In consolidated proceedings, the Trademark Trial and Appeal Board (“TTAB”) considered two discovery-related motions filed by Chicago Mercantile Exchange Inc. and New York Mercantile Exchange, Inc. (collectively, “CME”) in an Opposition filed by Intercontinental Exchange Holdings, Inc. (“ICE”) to registration of the mark “NYMEX BRENT.”

The first motion concerned CME’s request to modify the TTAB’s Standard Protective Order (“SPO”) to allow two CME in-house attorneys to view ICE’s confidential information, while the second motion required the TTAB to determine whether the European Union General Data Protection Regulation (“GDPR”) applied in TTAB proceedings. In its precedential order, the TTAB employed two different weighing tests to hold that CME’s in-house counsel was not permitted to review material designated confidential and that the GDPR does not apply in TTAB proceedings

With respect to the first motion, under the terms of the TTAB’s SPO, confidential information may be classified “Attorneys Eyes Only” (“AEO”) such that only outside counsel is permitted to review the materials. The SPO is implemented automatically in the TTAB’s inter partes cases but may be modified in one of two ways: by stipulation of the parties and approved by the TTAB, or upon motion granted by the TTAB.

Although CME sought to modify the SPO by motion, it asserted that the parties had agreed to a modification of terms and attached to its motion a proposed order containing a redlined version of the disputed language. The proposed order, however, did not include a redline of other changes made to the SPO. Because the proposed amended order did not contain all the modifications to the SPO, the TTAB found that it had not been properly presented for approval.

Turning to the substance of the motion, the TTAB noted that Federal Rule of Procedure 26(c) permits it to shield “a trade secret or other confidential research, development, or commercial information.” Nevertheless, the TTAB has wide latitude to modify a protective order for “good cause.” Good cause is a fact specific inquiry that requires the movant to describe with particularity the duties and party relationships of the attorneys who will be granted access to AEO. CME fell short in this area in what the TTAB described as a “minimal showing.”

In discussing CME’s in-house attorneys, the TTAB highlighted a declaration provided by CME that broadly outlined the duties of the two attorneys, but lacked requisite specificity. The TTAB was particularly concerned by a statement in the declaration noting that the attorneys provided advice on legal issues related to intellectual property. Based on the lack of information surrounding the in-house attorneys’ intellectual property-related activities, the TTAB was not able to determine whether the proposed attorneys were involved in competitive decision making that could result in the inadvertent disclosure of confidential information.

The TTAB then engaged in a three-part balancing test to weigh the needs of CME’s in-house counsel to participate in the litigation process and the need to protect AEO. The test is structured to gauge potential harm by whether proposed counsel is engaged in competitive decision making. 

The three factors include:

1. A party’s need for AEO to prepare its case;

2. The harm that disclosure would cause to the party providing AEO; and

3. The forum’s interest in preserving the confidentiality of AEO.

With respect to the first factor, the TTAB found that CME had not shown that it would be prejudiced in the preparation of its case if it did not have access to AEO. CME was represented by experienced counsel and its lack of access to AEO did not impair its ability to litigate its case.

The TTAB then looked to the second factor to assess the potential harm disclosure of confidential information may have to the party providing AEO. In finding that there was potential harm, the TTAB pointed to the fact that the in-house attorneys were involved with strategic licensing decisions and interact with CME business teams. Such activities presented a risk of competitive disadvantage.

Regarding the third factor, the TTAB emphasized its significant interest in preserving the confidentiality of sensitive business information to maintain efficient discovery, reduce discovery disputes, and lower costs to litigants.

In weighing all the factors, the TTAB held that CME did not demonstrate a need for its proposed in-house counsel to access ICE’s AEO.

The TTAB then turned to the question of whether ICE is permitted to redact personally identifiable information, such as names and email addresses, from documents stored in their office servers in the EU under the GDPR. ICE argued that if it failed to comply with the GDPR it would be subject to monetary fines.

The GDPR is an EU privacy regulation that is intended to protect the personal data of its citizens by limiting the transfer of such data. The definition of “personal data” under the GDPR is quite expansive and includes information commonly produced during discovery, such as names, email addresses, and job titles. This regulation applies to data transfers between EU members states, as well as data transfers between the EU and jurisdictions outside the Union.

Although ICE argued that it was required to redact personal information under the GDPR, the TTAB noted that the law of a foreign jurisdiction will generally not limit the production of evidence in proceedings before a United States tribunal. The TTAB further found that the GDPR is not a blanket prohibition on the transfer of personal data. Article 49(1)(e) of the GDPR states that data transfers are permitted “where the transfer is necessary for the establishment, exercise, or defence of legal claims” if the personal data is “relevant and necessary.”

Having found that the GDPR does not outright prohibit the transfer of personal data, the TTAB applied a five-factor balancing test promulgated by the Supreme Court in Societe Nationale Industrielle Aerospatiale v. U.S. Dist. Court, 482 U.S. 522, 544 n.29 (1987). The test balances the secrecy interests of the foreign jurisdiction with the interests of the United States and the party seeking discovery. The factors consist of:

1. The importance of the documents to the litigation;

2. The specificity of the request;

3. Whether the information originated in the United States;

4. Whether alternative means exist for obtaining the information; and

5. Whether non-compliance harms important U.S. interests, or whether compliance harms important interests of the jurisdiction where the information is kept.

With respect to the first factor, ICE asserted that it did not need to disclose the names and addresses attached to email sought by CME because such information was unnecessary. In rejecting this argument, the TTAB stated that basic identity information of current or former employees was relevant to the claims in the litigation because those individuals may have discoverable information. Further, the SPO allows for the redaction of identity information upon sufficient showing. This factor weighed in favor of disclosure.

The TTAB then considered the specificity of CME’s document request. Although ICE argued that the request was overly broad, CME asserted that the parties had agreed to reduce the scope of the request. In determining that the demand for documents was sufficiently targeted and not overly burdensome, the TTAB found that this factor weighed in favor of disclosure.

The third factor, whether the information originated in the United States, similarly weighed in favor of disclosure. ICE asserted that it has a several EU-based offices containing computer servers that store personal data. The TTAB responded that ICE is a U.S. company incorporated in Delaware with its principal place of business in Atlanta, Georgia.

With respect to the fourth factor, ICE argued that because it is providing the names of its U.S. personnel, the personal data of its E.U. personnel is unnecessary. It further argued that the CME could obtain similar data about its E.U. personnel from the personal data provided in its U.S. disclosures. The TTAB reiterated that basic, identifying information found in communications is discoverable. Therefore, the fourth factor weighed in favor of disclosure.

Lastly, in determining whether non-compliance harms important U.S. interests, the TTAB found that this factor weighed in favor of disclosure. Although ICE asserted that it faced significant financial penalties and that the GDPR bans transfers of personal data, the TTAB was unpersuaded.

In particular, the TTAB emphasized that the GDPR contains a litigation exception and that the private data would be produced under a protective order. ICE had also not demonstrated that monetary penalties had been levied against a party under the GDPR in a U.S. litigation where a protective order was in place. 

On balance, because ICE was protected by the TTAB’s SPO, and because the GDPR contains a litigation exception for “relevant and necessary information,” ICE was ordered to produce responsive, unredacted personal data to CME consistent with the requirements of the SPO.

The case is Intercontinental Exchange Holdings, Inc. v. New York Mercantile Exchange, Inc., 2021 U.S.P.Q.2d 988, (T.T.A.B. 2021).