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THE AMERICAN TOBACCO COMPANY v. THE HONORABLE GRAY EVANS AND ELLA MAE HOWARD HORTON

APRIL 29, 1987

THE AMERICAN TOBACCO COMPANY
v.
THE HONORABLE GRAY EVANS AND ELLA MAE HOWARD HORTON, AND NATHAN RANDALL HORTON, WIDOW AND SON OF NATHAN HENRY HORTON, DECEASED, INDIVIDUALLY AND ON BEHALF OF ALL WRONGFUL DEATH BENEFICIARIES OF THE DECEASED



ROBERTSON, JUSTICE, FOR THE COURT:

ON PETITION FOR WRIT OF PROHIBITION

I.

This case presents a sensitive question of first impression in this state: the discoverability of a manufacturer's trade secrets and other confidential research development or commercial information. For the reasons articulated below, we hold that, in the context of the facts and circumstances of this case, such information is discoverable by a party opponent, subject to a carefully drawn protective order prohibiting disclosure to unauthorized persons.

 II.

 This matter arises in the context of a civil action pending in the Circuit Court of Holmes County, Mississippi. In that action, Ella Mae Howard Horton and Nathan Randall Horton, (collectively" Horton ") widow and son of Nathan Henry Horton, deceased, claim to be the wrongful death beneficiaries of Nathan Henry Horton. They have brought suit against the American Tobacco Company and a distributor of its tobacco

 products, alleging, inter alia, that Horton developed and died from lung cancer caused by smoking" Pall Mall "cigarettes. Plaintiffs seek substantial compensatory and punitive damages. The case has been set for trial on August 31, 1987.

 On May 9, 1986, Horton served upon American written interrogatories, among which was Interrogatory No. 8 which reads:

 8. Please identify, by scientific name, generic name and chemical formula, all additives, chemical or otherwise, in Pall Mall cigarettes and its wrapping paper, and;

 (a) State whether or not each additive or material has ever been determined or suspected to be carcinogenic, cocarcinogenic, a tumor initiator, or to yield nitrosamines;

 (b) Identify tests, analyses, or research you have conducted, or had conducted on your behalf, to determine the properties and/or health hazards of each additive or material.

 On June 27, 1986, American filed its response objecting to Interrogatory No. 8 on several grounds, including that the information sought is confidential and proprietary and is irrelevant to the issues raised by Horton's claims.

 On July 30, 1986, Horton filed a Motion to Compel American to disclose, among other things, the information sought by Interrogatory No. 8.

 On August 13, 1986, American filed its Opposition to Plaintiffs' Motion to Compel. The Opposition was fully supported by an affidavit which established, among other things, that (1)" Pall Mall "is one of America's most popular brands of cigarettes; (2)" Pall Mall "cigarettes consist of flue-cured tobacco, air-cured tobacco, oriental tobacco, humectants, proprietary flavorings and paper wrapping; (3) American has never revealed so-called" additives "since it began manufacturing" Pall Mall ";

 (4) American enforces strict procedures to insure continued secrecy, including, but not limited t_o, (a) maintaining the formula books in a vault, (b) limiting access to such

 information to twenty employees, each of whom is bonded, (c) limiting the times these employees have access to the formula books, and (d) maintaining a written record of the period during which each of these employees has access to such information. The affidavit also established that certain of the flavorings used in" Pall Mall "cigarettes are purchased from outside" flavoring houses "that demand, as a contractual condition to such sale, non-disclosure of the contents of the flavorings. In short, American argued below, and here, that the identity of the ingredients of" Pall Mall "cigarettes is highly valuable proprietary information which, if disclosed would result in substantial economic injury to American. Revenue from the sale of" Pall Mall "cigarettes in the United States is said to account for a substantial portion of America's tobacco related income. American argued further that disclosure under any circumstances of the proprietary ingredients would jeopardize" Pall Mall's "unique flavor and characteristics and, as a consequence, would imperil" Pall Mall's "marketability as a competitive tobacco product.

 In January of 1987, the Circuit Court announced that it would require American to disclose the" additives. "Disclosure in fact was stayed pending submission of proposed protective orders, see Rule 26 (d)(7), Miss. R. Civ. P., and on April 7, 1987, the Circuit Court entered a Protective Order requiring American to disclose the identity of the ingredients of" Pall ...


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