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By Alina Selyukh
WASHINGTON (Reuters) - A federal appeals court aggressively questioned the scope of the public interest and trade secrets at a hearing on Tuesday over document secrecy in Apple Inc's patent litigation against Samsung Electronics Co Ltd.
A coalition of media advocacy groups and news organizations is asking the Federal U.S. Circuit Court of Appeals to uphold a lower court ruling that ordered the companies to unseal many financial documents filed in the high-stakes patent case.
Such a decision from the Washington-based appeals court would set an important precedent for high-level intellectual property cases, in which filing documents under seal has become almost standard procedure as companies try to keep their trade secrets and other sensitive business information from becoming public in court.
The coalition of media and free speech advocates, including the New York Times and Bloomberg, argued that access to the sealed information is important for the public to understand the judicial process and why one tech giant may ultimately prevail.
But the three-judge Federal Circuit panel, which specializes in patent cases, expressed concerns about whether their definition of trade secrets is too narrow and public interest, too broad.
"You really seem to be saying that a trade secret is the formula for Coke and not much else," said Judge William Bryson.
"If there are investors out there who are very interested in the (sealed financial data), are they part of the public interest?," he said, adding that such knowledge "wouldn't affect one's perception of the fairness of the proceeding."
U.S. District Judge Lucy Koh in San Jose, California had allowed Apple and Samsung to keep source code and details of patent licensing deals secret, but ordered them to reveal financial data and other information.
Apple and Samsung, who are accusing each other of patent violations as they vie for supremacy in a fast-growing market for mobile devices, argue that an unsealing order would spur a chilling effect on involving courts in future intellectual property disputes.
Reuters had intervened in the trial court to oppose many of the requests to seal. Koh's orders to reveal some sealed data are on hold pending the appeals court's decision.
"Most of the world would be shocked to find out that your financial data ... for products on the market today is not a trade secret," Federal Circuit Judge Sharon Prost said at the hearing on Tuesday.
The media companies have argued that the companies have not shown that unsealing documents would harm their business. Bryson on Tuesday also appeared to attempt to detach Samsung from Apple in the secrecy dispute, questioning Samsung's lack of its own proof of damages that unsealed documents would cause.
The Federal Circuit, when deciding issues not directly related to patents, uses legal precedents from regional federal appeals courts. Because the Apple/Samsung case was litigated in California, 9th Circuit case law will likely apply to the secrecy disputes.
The case in the Federal Circuit is Apple Inc vs. Samsung Electronics Co Ltd., 12-1600.
(Additional reporting by Dan Levine; Editing by Bernard Orr)