In BLST Northstar, LLC v. Santander Consumer USA, Inc., No. 22-cv-2210 (PAM/DJF), 2024 WL 4799847 (D. Minn. Nov. 15, 2024) (USMJ), a U.S. Magistrate Judge held that the documents and testimony at issue was subject to a common law presumption of public access. (No word in the opinion about the Constitutional presumption of public access.) This is apparently not an insurance case, but nothing in the opinion suggests that it does or does not involve insurance issues.
Holding that the common law presumption of public access applied to the materials at issue meant that the parties seeking secrecy had to demonstrate compelling reasons for keeping the materials secret.
The Magistrate Judge ruled that the parties met their burden in this case: Writing after “reviewing” the secretive materials, apparently in camera, the Magistrate concluded that they contained “sensitive or propriety business information that is competitively sensitive or contractually subject to nondisclosure such that the parties’ and one or more third party's legitimate interests in maintaining confidentiality outweighs any public interest in unsealing the documents.” BLST, 2024 WL 4799847, at *3.
The lesson for insurance cases may be this: Whenever a party or the parties together, as in this case, can convince a magistrate that the materials they want to keep secret contain:
- “sensitive business information,” such as a claims manual perhaps,
- or that they contain “proprietary business information,” such as adjusters’ notes fed into a computer program,
- and that this information is “competitively sensitive” such that other policyholders or other insurance companies might take advantage of the defendant carrier’s disclosure,
- or that the information in question is ”contractually subject to nondisclosure” such as a nondisclosure agreement made by the policyholder, for example,
then the magistrate will enter an order that the materials will not be seen by anyone except the parties’ lawyers, perhaps the parties, and certainly the judge that decides their case.
But not by the public.
Secrecy determinations in third-party insurance cases are set out in §§ 3:107 through 3:107.100 in 1 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH (Thomson Reuters West Publishing Co. 3d Edition and 2024 Supplements), and secrecy rulings in first-party insurance cases are discussed at length in §§ 9:28 - 9:28.100, inclusive, in 2 id.
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