Knight v. Super. Ct. CA4/1

California Court of Appeal · D063819 · 2013-06-06 · Unpublished

Proceeding: writ
Trial judge: Juan Ulloa
Outcome: writ granted — Petition granted in part.
Area: civil
Panel: Joan K. Irion (author), O'Rourke, McINTYRE

Analysis

A model's reading — qwen3.8-27b, prompt v1, 2026-10-13T06:53Z · confidence high

The trial court denied Knight's motion to quash a deposition subpoena, ordering the production of trade secret training materials under the general standard of discovery. The Court of Appeal granted the writ, holding that the trial court erred by failing to apply the heightened standard required for compelling the disclosure of privileged trade secrets.

Ruling reviewed	Standard	The court	The model
Denial of motion to quash deposition subpoena regarding trade secret training materials “This discovery standard does not apply to privileged trade secret documents. (Bridgestone/Firestone, Inc. v. Superior Court, supra, 7 Cal.App.4th at p. 1390.)”	de novo	error	agree with court The appellate court correctly identified that the trial court applied the general discovery standard (Code Civ. Proc., § 2017.010) rather than the heightened standard required by Evidence Code section 1060 and Bridgestone/Firestone for privileged trade secrets. Because the homeowners did not make the requisite prima facie showing of relevance and necessity, the trial court's order was legally insufficient.

Authorities

relied: Bridgestone/Firestone, Inc. v. Superior Court (1992) 7 Cal.App.4th 1384 — Establishes the heightened standard for discovery of trade secrets, requiring a prima facie showing of relevance and necessity before disclosure can be compelled.
relied: Alexander v. Superior Court (1993) 5 Cal.4th 1218 — Supports the issuance of a peremptory writ when the entitlement to relief is clear and the law is well-settled.
relied: Ng v. Superior Court (1992) 4 Cal.4th 29 — Supports the issuance of a peremptory writ in the first instance when the law is clear.
relied: Palma v. U.S. Industrial Fasteners, Inc. (1984) 36 Cal.3d 171 — Procedural authority for issuing a Palma notice in a writ proceeding.

The appellate opinion: sound — The opinion is sound because it correctly distinguishes between general discovery standards and the specific privilege protections afforded to trade secrets under Evidence Code section 1060. It accurately applies the precedent from Bridgestone/Firestone to find that the trial court failed to meet the necessary burden of proof before ordering disclosure.

How this analysis was made · dispute it

unusual disposition

A model's reading — claude-fable-5-1, prompt v1, 2026-10-13T04:31Z · confidence low

The Imperial County Superior Court denied nonparty Mark Knight's motion to quash a deposition subpoena, ordering production of FrontLine's training manual (which the court acknowledged was a trade secret) under the general relevance standard subject to a protective order, and also ordering production of D.R. Horton payment records. The Court of Appeal granted a peremptory writ in the first instance as to the trade secret materials, directing the trial court to vacate that portion of its order and reconsider under the heightened Bridgestone/Firestone standard, and denied the petition in all other respects.

Ruling reviewed	Standard	The court	The model
Denial of motion to quash and order compelling production of FrontLine training manual (acknowledged trade secret) under the general 'reasonably calculated to lead to admissible evidence' discovery standard “Here, rather than applying the heightened standard for discovery of a privileged trade secret, the respondent court applied the general standard for discovery under Code of Civil Procedure section 2017.010.”	unclear	error (law misapplied)	agree with court Evidence Code section 1060 makes trade secrets privileged, and Bridgestone/Firestone squarely holds that the Code of Civil Procedure section 2017.010 relevance standard applies only to non-privileged matter; the party seeking a privileged trade secret must make a prima facie, particularized showing that the information is relevant and necessary to a material element and essential to fair resolution. The trial court conceded the manual was a trade secret yet applied only the general standard, so the appellate court's identification of legal error is well supported. The opinion does not expressly state a standard of review, but applying the wrong legal standard is error under any standard.
Trial court's reliance on a protective order as a substitute for requiring the homeowners to meet the threshold showing of direct relevance and necessity before compelled trade secret disclosure “The court could not have required disclosure subject to a protective order unless it first found that the homeowners met their burden. By failing to do so, the court erred.”	unclear	error (law misapplied)	agree with court Under Bridgestone/Firestone, a protective order is a tool used after the requesting party has carried its burden; it does not relieve the requesting party of making the prima facie showing. The appellate court correctly sequenced the analysis and the result follows from the cited authority.
Order compelling production of records of payments from D.R. Horton to FrontLine over Knight's financial privacy objection “In all other respects, the petition is denied.”	unclear	correct	unsure Knight expressly challenged this request on financial privacy grounds, and the court denied relief on it, but the opinion contains no analysis of the privacy claim, no balancing of the homeowners' need against the privacy interest, and cites no authority on the point. The result may well be defensible (payments tied to the litigation homes are plausibly directly relevant to the Civil Code section 913 contact allegations), but the opinion gives no reasoning from which to confirm this.

Authorities

relied: Bridgestone/Firestone, Inc. v. Superior Court (1992) 7 Cal.App.4th 1384 — Trade secrets are privileged under Evidence Code section 1060; the general relevance standard of civil discovery does not apply, and the party seeking disclosure must make a prima facie, particularized showing that the information is relevant and necessary to a material element and essential to fair resolution before disclosure (even under a protective order) may be compelled.
relied: Palma v. U.S. Industrial Fasteners, Inc. (1984) 36 Cal.3d 171 — Procedure for issuing a peremptory writ in the first instance after notice to the parties and opportunity to respond.
relied: Alexander v. Superior Court (1993) 5 Cal.4th 1218 — A peremptory writ in the first instance is appropriate where petitioner's entitlement to relief is clear and the law is well settled.
relied: Ng v. Superior Court (1992) 4 Cal.4th 29 — Peremptory writ in the first instance is proper only in unusual circumstances where entitlement to relief is obvious.
missed: Valley Bank of Nevada v. Superior Court (1975) 15 Cal.3d 652 — The constitutional right of privacy protects confidential financial information, and before compelling its disclosure in discovery a court must balance the requesting party's need against the privacy interest; the opinion denied relief on Knight's financial privacy objection without addressing this framework.

The appellate opinion: sound with gaps — The trade secret analysis is correct and tracks Bridgestone/Firestone precisely: the trial court conceded the privilege yet applied the non-privileged relevance standard and treated a protective order as a substitute for the required threshold showing. However, the court denied relief on Knight's separate financial privacy objection to the payment records without any discussion or authority, leaving a gap on an issue the petition squarely raised.

How this analysis was made · dispute it

Opinion

Filed 6/6/13 Knight v. Super. Ct. CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE

STATE OF CALIFORNIA

MARK KNIGHT, D063819

Petitioner, (Imperial County Super. Ct. No. ECU06566) v.

THE SUPERIOR COURT OF IMPERIAL COUNTY,

Respondent;

CHAD KEY et al., Real Parties in Interest.

PROCEEDINGS in mandate after superior court denied motion to quash deposition subpoena. Juan Ulloa, Judge. Petition granted in part.

FACTUAL AND PROCEDURAL BACKGROUND Chad Key and 24 real parties in interest (the homeowners) filed a civil suit against D.R. Horton, Inc. (D.R. Horton) and others. In their second amended complaint, the homeowners assert a single cause of action for violation of the building standards for original construction pursuant to Civil Code section 896 et seq. Generally, the homeowners allege that the houses in their development—built by D.R. Horton and the other defendants—are materially defective and deficient in a number of ways. They seek damages to cover the cost of repairing their homes and to compensate them for consequential and incidental damages.

Petitioner Mark Knight is not a party to this action. Knight is the president of FrontLine Response, LLC (FrontLine), an "independent company that contracts with home builders to serve as an extension of their warranty department. In that capacity, FrontLine, with permission from homeowners, investigates issues homeowners may have with their home and forwards the requested repairs to the builder." D.R. Horton retained FrontLine to contact the homeowners after they initiated this litigation. FrontLine employees talked to the homeowners and offered to have their houses fixed in return for the homeowners signing a form letter asking their attorney to dismiss them from this action. The homeowners contend this conduct violates Civil Code section 913, which prohibits a builder or its representatives from contacting plaintiffs outside the presence of their attorney.

2 The homeowners served a deposition subpoena on Knight, seeking to take his deposition and asking him to produce certain documents. Knight's petition concerns only two of those document requests: those seeking (1) "training materials provided by FrontLine Response, LLC to employees"; and (2) information about "payments received by YOU from D.R. Horton for work performed regarding any homes involved in the lawsuit."

Knight moved to quash the deposition subpoena. In a declaration, Knight asserts that the requested training materials include trade secret information which is not subject to disclosure. Knight also contends the request for documents concerning payments by D.R. Horton to FrontLine violates his right to privacy regarding financial information.

The trial court denied the motion to quash. At the hearing on the motion, the court acknowledged the training manual constitutes a trade secret, but found the information could be adequately shielded by a protective order. According to the court, disclosure is warranted because "all of those matters seem, to me, to be relevant at least in terms of possibly leading to discoverable or admissible evidence."

In this petition, Knight contends the denial was improper and asks us to direct the trial court to limit the ordered production. We requested an informal response to the petition and issued Palma notice. (Palma v. U.S. Industrial Fasteners, Inc. (1984) 36 Cal.3d 171, 178.)

3 DISCUSSION

According to Knight, FrontLine derives economic value from its training manual, which includes information and techniques not generally known by other similar businesses in its "niche industry." FrontLine takes several measures to protect the manual from disclosure. The homeowners do not challenge Knight's declaration or otherwise dispute that the FrontLine training materials are a protected trade secret as defined by Civil Code section 3426.1, subdivision (d).

Evidence Code section 1060 creates a privilege for trade secrets and authorizes the owner of a trade secret to refuse to disclose the secret "if the allowance of the privilege will not tend to conceal fraud or otherwise work injustice." In Bridgestone/Firestone, Inc. v. Superior Court (1992) 7 Cal.App.4th 1384, the court applied Evidence Code section 1060 in the context of civil discovery. The court held that it would be error to order disclosure of a trade secret simply because such information would be discoverable under the general standard for discovery of matter that " 'appears reasonably calculated to lead to the discovery of admissible evidence.' " (Bridgestone/Firestone, Inc. v. Superior Court, supra, at p. 1390; see also Code Civ. Proc., § 2017.010.) As the court explained, that standard applies only to matters that are not privileged. (Bridgestone/Firestone, Inc.

v. Superior Court, supra, at pp. 1390-1391.) Because Evidence Code section 1060 creates a privilege for trade secrets, use of a heightened standard is necessary before 4 disclosure of documents containing trade secrets will be compelled.

(Bridgestone/Firestone, Inc. v. Superior Court, supra, at p. 1393.)

Under this heightened standard, the party seeking discovery "must make a prima facie, particularized showing that the information sought is relevant and necessary to the proof of, or defense against, a material element of one or more causes of action presented in the case, and that it is reasonable to conclude that the information sought is essential to a fair resolution of the lawsuit." (Bridgestone/Firestone, Inc. v. Superior Court, supra, 7 Cal.App.4th at p. 1393.)

Here, rather than applying the heightened standard for discovery of a privileged trade secret, the respondent court applied the general standard for discovery under Code of Civil Procedure section 2017.010. The court found the training manual was subject to discovery because "all of those matters seem, to me, to be relevant at least in terms of possibly leading to discoverable or admissible evidence." This discovery standard does not apply to privileged trade secret documents. (Bridgestone/Firestone, Inc. v. Superior Court, supra, 7 Cal.App.4th at p. 1390.)

Although the court also ordered the parties to prepare a protective order in an attempt to protect the trade secret information, such an order is appropriate only after the party seeking discovery meets its burden of establishing that the information sought is directly relevant and its disclosure is necessary. (Bridgestone/Firestone, Inc. v. Superior Court, supra, at p. 1393.) The court could not have required disclosure subject to a 5 protective order unless it first found that the homeowners met their burden. By failing to do so, the court erred.

6 Because Knight's entitlement to relief is clear and the law is well-settled, we conclude a peremptory writ in the first instance is proper. (Code of Civ. Proc., § 1088;

Alexander v. Superior Court (1993) 5 Cal.4th 1218, 1222-1223, disapproved on another ground in Hassan v. Mercy American River Hospital (2003) 31 Cal.4th 709, 724, fn. 4;

Ng v. Superior Court (1992) 4 Cal.4th 29, 35.)

DISPOSITION

Let a writ of mandate issue directing the superior court to vacate its March 5, 2013 order insofar as it directs Knight to provide trade secret information to real parties in interest and to reconsider the issue under the proper standard. In all other respects, the petition is denied. The stay issued by this court on May 7, 2013 is vacated. Knight is entitled to costs in the writ proceeding. (Cal. Rules of Court, rule 8.493(a)(1)(A).) This opinion is made final immediately as to this court. (Cal. Rules of Court, rule 8.490(b)(3).)

7 IRION, J.

WE CONCUR:

O'ROURKE, J.

McINTYRE, Acting P. J.

Cites, in this corpus

Hassan v. Mercy American River Hospital S106256 · 2003-08-18
Alexander v. Superior Court S026431 · 1993-10-14
Ng v. Superior Court S025119 · 1992-12-03
Bridgestone/Firestone, Inc. v. Superior Court A053717 · 1992-06-24
Palma v. U.S. Industrial Fasteners, Inc. L.A. No. 31725 · 1984-06-07