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Mosaic Potash Carlsbad, Inc. v. Intrepid Potash, Inc.

United States District Court, D. New Mexico

January 6, 2020

MOSAIC POTASH CARLSBAD, INC., Plaintiff,
v.
INTREPID POTASH, INC., INTREPID POTASH-NEW MEXICO, LLC, and STEVE GAMBLE, Defendants.

          MEMORANDUM OPINION AND ORDER

         This matter comes before the Court upon “Mosaic Potash Carlsbad, Inc.'s Motion to Partially Exclude Intrepid Rule 26(a)(2)(C) Experts” (Motion to Partially Exclude), filed May 15, 2019. (Doc. 211). Defendants Intrepid Potash, Inc. and Intrepid Potash-New Mexico, LLC (collectively, Intrepid) filed a response on June 4, 2019. (Doc. 235). Plaintiff Mosaic Potash Carlsbad, Inc. (Mosaic) filed a response on June 16, 2019. (Doc. 265). Having considered the Motion to Partially Exclude, the accompanying briefing, the relevant evidence and the law, the Court grants the Motion to Partially Exclude, in part, as described herein. The Court notes that it filed this Memoranda Opinion and Order under seal. See (Doc. 62). Even so, the Court reserves judgment to determine at an appropriate time whether to unseal the Memorandum Opinion and Order.

         I. Background

         Mosaic processes langbeinite (lang), a potash ore, to produce fertilizer. Mosaic alleges that its former employee, Defendant Steve Gamble, violated his confidentiality agreement with Mosaic by misappropriating Mosaic's trade secrets and confidential information when he went to work for Intrepid, Mosaic's competitor, on January 5, 2015. Mosaic contends that Intrepid hired Gamble for his knowledge of Mosaic's lang processing which allegedly resulted in an increase of “Intrepid's Lang production and recovery efficiency” and an improvement of Intrepid's “methods for granulation of Lang, ” i.e., lang pelletization. (Doc. 66) at ¶ 2. Intrepid and Gamble argue that they did not misappropriate any of Mosaic's trade secrets or confidential information.

         A. Lang Processing

         Processing raw lang ore begins with passing the ore through a crusher to grind the ore into smaller particles. (Doc. 241) at ¶ 8. The particles are then separated into coarse and fine particles, or “fines.” (Doc. 240-1) at ¶ 24. The impurities in the coarse particles and fines are removed through leaching. Id. The fines are later mixed with a binder to build them into pellets or granules. Id. at ¶ 30. Prior to hiring Gamble, Intrepid operated a dual sylvite-lang plant. (Doc. 240-1) at ¶ 45. After hiring Gamble, Intrepid switched to a lang-only plant which required Intrepid to redesign its crushing circuit. (Doc. 241) at ¶ 14.

         B. Intrepid's Non-Retained Experts' Opinions

         On April 10, 2019, Intrepid disclosed four non-retained experts pursuant to Fed.R.Civ.P. 26(a)(2)(C): Steve Bytnar (vice president of research and quality at EnviroTech Services, Inc. (EnviroTech), an Intrepid consultant); Michael Morrison (former corporate process chemist at Intrepid); Chris Nyikos (a current Intrepid strategic engineer), and Brett Berg (a current Intrepid senior project engineer). (Doc. 212-1). Mosaic moves to exclude certain portions of the expected testimony of those non-retained experts.

         1. Bytnar

         a. Rule 26(a)(2)(C) Summary of Bytnar's Expected Testimony

         Bytnar will testify about Intrepid's binder testing and binder selection. Bytnar and his company, EnviroTech, were “involved in the identification of CMC as a binder solution for Intrepid in 2014 and 2015.” (Doc. 212-1) at 4. EnviroTech's 90 days of binder lab testing ended in early March 2015. Id. EnviroTech also did pilot testing at a company called FEECO, in Wisconsin. Id. In the process of scheduling the final production testing at Intrepid, Bytnar “heard the name Steve Gamble for the first time.” Id. After that final production testing, “EnviroTech identified one CMC product as being superior to the others.” Id.

         Mosaic objects[1] to the following expected testimony by Bytnar:

Gamble had no involvement in any of the testing that identified and confirmed the CMC binder as being the superior option. Gamble provided no information regarding, and had no influence on, the identification and selection of CMC as Intrepid's binder. In Mr. Bytnar's opinion, Intrepid's selection of CMC was the result of Envirotech's extensive scientific testing, and in no way was influenced by Steve Gamble.

Id.

         b. Bytnar's Deposition Testimony

         Bytnar's personal involvement with the binder research at Intrepid effectively ended in April 2015. (Doc. 212-2) at 3-4. The CMC binder Bytnar recommended to Intrepid was produced by Ashland and known as “12M31XP.” Id. at 5-6. Bytnar testified that Gamble had no influence on what happened in Bytnar's lab. Id. at 7. Bytnar, however, did not know whether Gamble had any influence “as to what happened in Intrepid's facility” or whether Gamble steered Intrepid away from an alternative binder and toward a CMC product. Id. at 7, 14. Bytnar also did not know whether Gamble was involved in Intrepid's subsequent selection of other CMC binders like Aqualon's CMC 12M31XT or CP Kelco's CMC FINNFIX HPB.[2] Id. at 8-12.

         Bytnar testified that the first time he saw Gamble's name was in an email scheduling the final binder production testing at Intrepid. (Doc. 235-3) at 3, depo. at 51-52. When Bytnar attended the final binder production testing, he met Gamble for the first time. Id. at 3, depo. at 52. Bytnar observed Gamble asking Morrison and another individual for data reports on the CMC binder and how it compared to starch. Id. Bytnar presumed that “Gamble had some role in the production of the material in some sort of a supervisory role at the plant.” Id.

         2. Morrison

         a. Rule 26(a)(2)(C) Summary of Morrison's Expected Testimony

         Morrison will testify about lang “fines dissolution testing, and binder testing and selection.” (Doc. 212-1) at 4. In the spring of 2014, prior to Gamble's employment at Intrepid, Morrison conducted “dissolution testing to determine the optimal leach time for langbeinite fines.” Id. at 5.

         Mosaic objects to the following expected testimony by Morrison:

In Mr. Morrison's opinion, the lab testing he did was a scientifically correct way to determine the optimal leach time to dissolve halite and other impurities from langbeinite.
Mr. Morrison's lab testing determined that the optimal leach time for fine langbeinite is approximately one minute.

Id.

         Morrison was also involved with EnviroTech's binder testing and selection of the CMC binder in the spring of 2015. Id. Mosaic further objects to the following expected testimony by Morrison:

Gamble had no involvement in any of the testing that identified and confirmed the CMC binder as being the superior option. Gamble provided no information regarding, and had no influence on, the identification and selection of CMC as Intrepid's binder. In Mr. Morrison's opinion, Intrepid's selection of CMC was the result of Envirotech's extensive scientific testing, and data generated by FEECO and within Intrepid's pellet plant during trial runs and in no way was influenced by Steve Gamble.

Id. at 5-6.

         b. Morrison's Deposition Testimony

         Morrison explained at his deposition that an “optimal” leach time means “the shortest amount of time to essentially make grade.” (Doc. 212-3) at 3-4. Morrison did not take into account lang dissolution losses in calculating the optimal leach time, but instead focused on the dissolution of impurities to reach an “optimal” leach time. See Id. at 4. Nonetheless, at some point, Morrison calculated lang dissolution losses. (Doc. 235-4) at 3, depo. at 78-79.

         Morrison further explained why his lab testing was the “scientifically correct way to determine the optimal leach time….” (Doc. 212-3) at 4-6. Morrison also clarified that he based the one-minute optimal leach time on testing that used pond brine, not fresh water. Id. at 7-8.

         Morrison left Intrepid in May 2016. Id. at 9. Morrison testified that he does not know what the current fines leaching process is at Intrepid and so cannot opine as to that process. Id. at 11.

         With respect to EnviroTech's selection of a superior CMC binder, Morrison only recalled that EnviroTech selected a CMC 12M31 series binder. Id. at 15. He also could not recall the manufacturer of the selected CMC binder. Id. at 16. Morrison did not know if EnviroTech shared its testing and test results with Gamble. Id. at 17. In addition, Morrison did not remember what binders underwent FEECO testing nor how many CMC binders EnviroTech scheduled for final production testing at Intrepid. Id. at 18-20. Morrison, however, testified that during that final production testing, Gamble, as an engineer, “helped in the plant test, but he did not help in the identification of a CMC binder.”[3] (Doc. 235-4) at 4, depo. at 103-04.

         Morrison further testified that he was not personally involved in the selection of the CMC binder. (Doc. 212-3) at 22. In fact, Morrison could not say whether Gamble affected the Intrepid decision-makers' selection of a binder. Id. at 23. Morrison testified that he did not know whether Gamble influenced Intrepid's selection of a particular CMC binder. Id. at 24.

         3. Nyikos

         a. Rule 26(a)(2)(C) Summary of Nyikos' Expected Testimony

         Nyikos will testify about processing lang “and other potash products.” (Doc. 212-1) at 6.

         Nyikos is expected to testify that he

has some knowledge of some aspects of Mosaic's operation, for example the fact that Mosaic has a much greater ability to dispose of effluent water in the Laguna Grande. Because it can use more water in its processing of langbeinite, and because its ore is not the same as Intrepid's, and because Mosaic uses certain different types of equipment, the technical details of Mosaic's processing are necessarily going to be different from those of Intrepid's. ...

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