22 Fla. L. Weekly Supp. 792a
Online Reference: FLWSUPP 2207BROWInsurance — Automobile — Discovery — Trade secret privilege — Trial court departed from essential requirements of law in compelling disclosure of competitive pricing survey relied upon by insurer in making estimate of cost of automobile repair work without determining whether survey constituted trade secret and, if so, whether there was reasonable necessity for production
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Petitioner, v. COLLISION CONCEPTS, INC., A/A/O JOHN BROWER, Respondent. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Petitioner, v. COLLISION CONCEPTS, INC., A/A/O TRACY PARSONS, Respondent. Case Nos. 502014CA007531XXXXMB & 502014CA007600XXXXMB. L.T. Case Nos. 502012SC009988XXXXMB & 502012SC009995XXXXMB. Circuit court, Fifteenth Judicial Circuit (Appellate) in and for Palm Beach County, Appellate Division (Civil) AY. Opinion filed April 10, 2015. Appeal from the County Court in and for Palm Beach County, Judge Frank S. Castor. Counsel: Johanna Clark, Orlando, for Petijtioner. Diana Martin, Palm Beach Gardens, for Respondent.
(PER CURIAM.) We grant Petitioner’s Motion to Clarify and withdraw our prior opinion and replace it with the following. This appeal consists of two consolidated petitions for writs of certiorari. In both cases, Petitioner State Farm Mutual Automobile Insurance Company seeks to quash a trial court order compelling it to produce a competitive pricing survey (“the Survey”). Petitioner argues that the Survey is confidential and contains trade secrets, and that the trial court departed from the essential elements of the law in ordering its production. As the trial court failed to make specific findings regarding the trade secret argument, we agree and grant the Petition.
John Brower and Tracy Parsons (“the Insured”), both owned vehicles insured by Petitioner. The two vehicles were involved in accidents and were brought to Respondent for repair. Respondent, an automobile body repair shop, created invoices of what it would cost to repair the vehicles. Petitioner approved estimated costs for the repair work on Mr. Brower’s and Ms. Parsons’ vehicles, respectively. Petitioner based the payment amounts in part on an internally compiled Survey of prevailing competitive prices among repair shops. Respondent, however, charged more than the estimate. Respondent subsequently obtained an assignment from the Insured and brought an action against Petitioner for breaching its policy, seeking the difference plus interest, costs, and attorney’s fees.1 Respondent filed complaints alleging that Petitioner violated the policy provision requiring it to pay to return the Insured’s vehicles to pre-accident operational safety, function, and appearance. As an affirmative defense, Petitioner asserted that the policy also allows for payment pursuant an estimate based on a Survey of prevailing competitive prices, compiled by Petitioner. Respondent moved to compel production of the Survey to determine whether Petitioner’s estimate conformed to the Survey data, claiming that it would be unable to rebut Petitioner’s affirmative defense without it. The trial court heard argument,2 denied Petitioner’s request for a two-tier confidentiality agreement, and entered an order in each case requiring Petitioner to produce the unredacted Survey within fifteen (15) days. Neither order made any findings regarding trade secret or confidentiality.
Petitioner primarily argues that the Survey constitutes a trade secret and that the trial court erred in ordering its production. Trade secrets are privileged under Section 90.506, Florida Statutes (2013). This privilege, however, is not absolute, and trade secrets can be obtained via discovery under certain circumstances. To determine if such circumstances exist, a trial court generally must (1) determine whether the requested production constitutes a trade secret, (2) if it is a trade secret, determine whether there is a reasonable necessity for production; and (3) if production is ordered, the trial court must set forth its findings. Sea Coast Fire, Inc. v. Triangle Fire, Inc., No. 3D14-973, 2014 WL 6679018, at *2-3 (Fla. 3d DCA Nov. 26, 2014) [39 Fla. L. Weekly D2480a] (citing Gen. Caulking Co., Inc. v. J.D. Waterproofing, Inc., 958 So. 2d 507, 508 (Fla. 3d DCA 2007) [32 Fla. L. Weekly D1400b]). Failure to follow these steps generally constitutes a departure from the essential requirements of the law. Id. Here, it is unclear whether the trial court made any of the required determinations because it made no relevant findings. Rather, the trial court simply granted Respondent’s Motion to Compel, stating that Petitioner had to produce the Survey because one of the affirmative defenses relied on it. The written orders provided no further elaboration. Therefore the trial court departed from the essential requirements of the law by failing to make the findings required to order production of the Survey after Petitioners claimed trade secret protection.
Petitioner also argues that the Survey is generally confidential and claims that the lower court failed to properly balance the interests of the repair shops. Petitioner relies on Westco, Inc. v. Scott Lewis’ Gardening & Trimming, Inc., 26 So. 3d 620, 622 (Fla. 4th DCA 2009) [35 Fla. L. Weekly D58a], which states:
When confidential information is sought from a non-party, the trial court must determine whether the requesting party establishes a need for the information that outweighs the privacy rights of the non-party. The party seeking discovery of confidential information must make a showing of necessity which outweighs the countervailing interest in maintaining the confidentiality of such information.
Westco, Inc. v. Scott Lewis’ Gardening & Trimming, Inc., 26 So. 3d 620, 622 (Fla. 4th DCA 2009) [35 Fla. L. Weekly D58a] (citations omitted); see also Higgs v. Kampgrounds of Am., 526 So. 2d 980, 981 (Fla. 3d DCA 1988). An evidentiary hearing or in camera review of the subject records is generally the appropriate mechanism for assisting the trial court in balancing these competing interests. Bianchi & Cecchi Servs., Inc. v. Navalimpianti USA, Inc., No. 3D14-2039, 2015 WL 1223663, at *2 (Fla. 3d DCA Mar. 18, 2015) [40 Fla. L. Weekly D668b].3 However, there is no hard and fast rule requiring the trial court to conduct an evidentiary hearing or an in camera review. Id. “[A] trial court does not necessarily depart from the essential requirements of law by not conducting either an evidentiary hearing or an in camera review” with reference to non-party concerns regarding production of financial information. Id. at *3.
According to Petitioner, the trial court erred in failing to weigh the needs of the repair shops. However, Petitioner has failed to demonstrate that such is the case. The trial court was not required to make any specific findings as to the balance of interests, nor was it required to perform an in camera review. See Id. Rather, Petitioner has shown that the trial court heard argument regarding the different interests, including the repair shops, and then made a ruling. This does not demonstrate a departure from the essential requirements of the law.
Accordingly, the trial court departed from the essential requirements of the law by failing to make the findings required to order production of the Survey after Petitioners claimed trade secret protection. As such, the Petition for Writ of Certiorari is GRANTED, the orders compelling production in both cases are QUASHED, and the case is remanded for further proceedings consistent with the foregoing. (G. KEYSER, BURTON, and BARKDULL, JJ., concur.)
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1The two complaints were filed separately but evaluated by the trial court in tandem. Hearings on the motions at issue in the present Petition were held in tandem as well.
2This hearing was not an evidentiary hearing; the trial court merely heard the attorneys’ argument as to several motions at issue, including the Motion to Compel.
3Indeed, an in camera review or evidentiary hearing is also generally suggested for proper evaluation of trade secret arguments. See, e.g., Summitbridge Nat’l Invs. LLC v. 1221 Palm Harbor, LLC, 67 So. 3d 448, 450 (Fla. 2d DCA 2011) [36 Fla. L. Weekly D1888b] (noting that to determine whether requested information constitutes a trade secret, the trial court may perform an in camera inspection or other document examination).
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