Latham Seeks Removal of Trade Secrets Case to Federal Court

, The Legal Intelligencer

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Latham & Watkins is looking to remove to federal court a breach of contract and trade secrets case brought against it by a Pennsylvania legal services management company.

The law firm filed Wednesday a notice of removal to the U.S. District Court for the Eastern District of Pennsylvania after being sued in the Philadelphia Court of Common Pleas by Mattern & Associates.

Glen Mills, Pa.-based Mattern bills itself as a consulting firm that aids law firms and corporations in obtaining more favorable and competitive pricing from their support service providers.

In December 2011, Mattern and Latham & Watkins entered a nondisclosure agreement before discussing possible ways Mattern could assist the law firm in reducing its service provider costs. According to Mattern's motion to compel pre-complaint discovery in the case, Mattern gave Latham some of Mattern's intellectual property and confidential information on how it would accomplish the cost reductions. That information included Mattern's Nearsight Solution and Hardcost Pass Through Model, the company said in its court filings.

After reviewing Mattern's proposals, Latham decided not to engage the company's services, according to the complaint. Mattern said Latham instead chose to hire a competitor of Mattern's. Mattern said in its court filings that it has reason to believe Latham shared Mattern's confidential information with prospective support services providers as well as the competitor Latham ultimately hired.

Those providers included Creative Management Services, according to Mattern's court filings. CMS, according to its website, provides similar services to what Mattern's business supplies. According to the complaint, on June 21, 2012, Latham asked its current support service provider and a number of prospective providers to incorporate into their responses for Latham's RFP the information Mattern shared with Latham.

Mattern asked Latham to review the law firm's requests for proposals sent to various service providers to determine whether Mattern's confidential information was in fact used. According to Mattern's filings, Latham declined and Mattern filed a writ of summons against the firm in the Philadelphia Court of Common Pleas on Dec. 14, 2012. A complaint was filed in October of this year and Latham is now seeking to remove the suit to federal court.

During the almost year between the filing of the writ and the complaint, the parties attempted to engage in pre-complaint discovery. According to Mattern's court filings, Latham refused to provide Mattern with any documents. Latham said in its court filings that it objected to the requests without knowing more about what the suit entailed. Mattern was seeking documents related to Mattern's proposal, any conversations Latham had with potential vendors regarding outsourcing support services, RFPs issued to vendors for support services and the responses to those RFPs, and documents between Latham and CMS regarding outsourcing Latham's support services, according to court papers.

Mattern is suing Latham for breach of contract, misappropriation and conversion of trade secrets, unjust enrichment and an accounting of what benefit Latham has received from allegedly using Mattern's confidential information. Mattern is asking the court to order Latham to return all of Mattern's documents and disgorge any savings it has or will receive from allegedly using the confidential information. The company is also seeking other unspecified damages as a result of the alleged activity, according to the complaint.

Nicholas Poduslenko of Obermayer Rebmann Maxwell & Hippel represents Mattern and did not respond to a request for comment. Samantha Southall of Buchanan Ingersoll & Rooney is representing Latham in the case. Southall referred a request for comment to Latham. A Latham spokeswoman said, "We intend to defend this case vigorously."

Gina Passarella can be contacted at 215-557-2494 or at gpassarella@alm.com. Follow her on Twitter @GPassarellaTLI. •

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