Background
This appeal arose from a breach-of-contract dispute over a 2001 settlement agreement governing oil and gas rights on property owned by the Chlebinas. The Chlebinas alleged that Landmark violated the agreement by seeking to directionally drill a particular well. During discovery, the Chlebinas sought to compel a non-party witness to answer deposition questions about Landmark’s drilling plans and strategies developed around 2017. Landmark opposed, arguing the information constituted trade secrets under R.C. 1333.61(D).
The trial court ordered the witness to provide written answers directly to the court for in camera review. After reviewing those answers, the trial court determined that most did not constitute trade secrets and ordered their disclosure. Landmark filed a supplemental affidavit from its principal addressing the specific trade-secret factors, but the trial court declined to consider it, finding it untimely. Landmark appealed both the initial discovery ruling and the order compelling disclosure of the witness answers.
The Court’s Holding
The Ninth District dismissed the appeal in part (as to the initial discovery order, which was not a final appealable order) and reversed in part (as to the order compelling disclosure of the trade-secret-protected answers). The court found that the trial court erred by refusing to consider Landmark’s supplemental affidavit, which contained detailed information addressing the factors from State ex rel. Besser v. Ohio State Univ. for determining trade-secret status. The supplemental affidavit demonstrated that certain of the witness’s answers regarding drilling strategies, methodologies, and geological analysis satisfied the statutory definition of trade secrets under R.C. 1333.61(D).
The court remanded for the trial court to consider the supplemental evidence and fashion an appropriate protective order under Civ.R. 26(C) to balance the Chlebinas’ discovery needs against Landmark’s legitimate trade-secret protections.
Key Takeaways
- Oil and gas drilling strategies, methodologies, and geological analyses can constitute trade secrets under R.C. 1333.61(D) if the claimant demonstrates their independent economic value and reasonable efforts to maintain secrecy.
- Trial courts must consider all evidence bearing on trade-secret status, including supplemental affidavits filed during the in camera review process, rather than excluding such evidence as untimely.
- The proper remedy when trade secrets are at issue in discovery is a protective order under Civ.R. 26(C), not outright preclusion of all discovery on the topic.
Why It Matters
This decision is significant for Ohio oil and gas practitioners and any litigator handling trade-secret disputes in the discovery context. It establishes that drilling plans, well-completion strategies, and geological data can meet the statutory definition of trade secrets, requiring trial courts to craft protective orders rather than ordering blanket disclosure. The decision also reminds practitioners that supplemental evidence supporting trade-secret claims should be considered by the trial court regardless of when it is submitted during the in camera review process. For parties seeking discovery, the case confirms that trade-secret protections do not entirely shield relevant information from disclosure—rather, the court must balance access against protection through appropriate safeguards.