Claims and Bad Faith Law Blog

BLANKET PROTECTIVE ORDERS vs. BLANKET SECRECY CONTRACTS.

The difference to the parties may be compelling someone else to keep a secret (stipulated blanket protective orders entered by a Court) versus entering into written agreements enforceable as contracts to keep the same secrets (contracts).

          But to a Federal Court sitting within the boundaries of the Ninth Circuit, blanket protective orders are not particularized in that they are not directed to a particular document or to particular information for which a party pleads protection from disclosure.  They do not show any specific harm that would result if the material in question were to be disclosed.

          Since they are not particularized, i.e., not directed to particular material, they fail to show good cause for Court-ordered protection of that particular material and so they fail to meet the requirements for a protective order signed by a Court within the Ninth Circuit.   AgJunction LLC v. Ag Leader Tech., Inc., No. CV-20-02204-PHX-SPL, 2021 WL 1969523, at *1-*2 (D. Ariz. March 9, 2021).

            The Court in this case also raised the possibility of an argument that Federal Courts lack the jurisdiction to enter blanket protective orders in the absence of a case or controversy ....

To be continued ....  Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

"TOO SMART BY HALF": THE TRUE STORY OF FORBIDDEN CONVERSATIONS.

Judge's Gavel.  (Sun Sentinel)

We have been looking lately at four cases of Stipulated Protective Orders, each one decided on the same day two weeks ago as these words are written.

          The lesson to be learned here is that these four SPOs are not simply typical of each other; they are typical of SPOs in thousands of cases in all types of litigation in the 21st Century.

          One of the more chilling provisions that lawyers have written into their SPOs concerns what they call "SCOPE."  This is the provision in which they say how far they intend their order to reach.  In that paragraph, the lawyers have all agreed that the Protective Order they are proposing will cover any "conversations" that they may have "that reveal Protected Material."

         In some cases, such as Premier Valley Bank in the Eastern District of California, the lawyers have agreed that "Protected Material" is what they say it is; when they have written "CONFIDENTIAL--ATTORNEYS' EYES ONLY" on disclosure or discovery material, then it is protected from public view.  Premier Valley Bank, 2021 WL 1164684, ¶ 2.11, at *2.  In other cases, including in the Central District of California, recent provisions have lowered the bar for recognizing "Protected Material" to material on which the lawyers have written, simply, "CONFIDENTIAL."  E.g., Diarian, 2021 WL 1163962, ¶ 2.13, at *3; Ramos, 2021 WL 1163575, ¶ 2.14, at *2; Orellana, 2021 WL 1163234, ¶ 2.14, at *3.  In all these cases as in most SPOs if not every SPO, the lawyers prevent material from being disclosed because they say it should not be disclosed.

         This may prove to be "too clever by half," as they say.   If "conversations" about confidential material disclosed or discovered in one case are prohibited in other cases, then the lawyers who wrote these agreements seem to have prohibited themselves  from representing the same clients on the same issues in future cases.  This can have real and not simply theoretical consequences, of course.

         For example, the defendant in the Orellana case is Target.  It is reasonably foreseeable that Target will be accused in other cases -- including in future cases -- of many of the same things that Target is accused of in the pending Orellana case.  If that ever happens, then the same lawyers may be prohibited from having "conversations" necessary to defend their client, Target, in any of those cases.

         This provision has echoes of the record in a recent Nondisclosure Agreement or NDA case in the Southern District of New York.  The record in that case reflects that the political campaign that wrote the NDA in that case, also attempted to enforce it in an earlier proceeding by alleging that a former campaign employee violated the NDA "'when she and her attorneys made statements about her lawsuit ....'"  Denson v. Donald J. Trump For President, Inc., No. 20 Civ. 4737 (PGG), 2021 WL 1198666, at *6 (S.D.N.Y. March 30, 2021) (emphasis added).  The Court ruled that the threatened enforcement of this sort of contract that restricts speech, 2021 WL 1198666, at *10, was invalid and unenforceable.

         The SDNY Court's reasoning concerning a Campaign's NDA is instructive concerning SPOs which have similar secrecy provisions.  "As to the scope of the [nondisclosure] provision" in that case, "it is -- as a practical matter -- unlimited."  It was unlimited in its vagueness, 2021 WL 1198666, at *14, just as the SPOs are equally unlimited in their own vagueness.

         Further, the New York Federal Court ruled, "[w]hether the scope of the restrictions in the non-disclosure provision is reasonable must be considered in light of what the Campaign contends are the 'legitimate interests' protected by this provision."  2021 WL 1198666, at *15.  "But even with respect to those categories the terms are not defined," and people purportedly bound by the secrecy provision are left with no idea how to comply with it. 

         "The non-disclosure provision's vague, overbroad, and undefined terms also render it unduly burdensome."  In short, because the effect of these burdens "is to chill the speech" of Campaign workers "about matters of public interest, the non-disclosure provision is harmful not only to them but also to the general public."  2021 WL 1198666, at *15.

         The same could be said of the Stipulated Protective Orders' "vague, overbroad, and undefined" terms such as "Protected Material" marked as 'Confidential' or 'Confidential-Attorney's Eyes Only' by the pens of lawyers, and such as undefined "conversations" that somehow "reveal Protected Material."

         One further thought, which the Federal Judge expressed in the case in the Southern District of New York.  Even if the Court were to set aside other standards of analysis in that case, "the non-disclosure provision is unenforceable under basic principles of contract law."  2021 WL 1198666, at *16.  It is impossible for a person "to know what speech she has agreed to forego" under such provisions, so that the supposed contract simply does not exist, there being "no possibility of mutual assent."  2021 WL 1198666, at *16.

         It seems equally impossible for a person to know what kind of speech she or he has agreed to forego in the stipulations quoted in the series of articles under discussion here.  If it is impossible for a person to know what "conversations" or speech she or he has agreed to forego under such provisions, the supposed stipulation is similarly void for vagueness, ineffective as a contract and unenforceable.  Submitting such provisions to a Federal Judge or Magistrate should not turn them into gold by some judicial alchemy; unenforceable provisions do not become enforceable simply because they have been signed by a judge.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.   

TO WHOM IT MAY CONCERN: QUESTIONS ABOUT YOUR SECRECY AGREEMENTS.

There is just enough time for a few questions in this special Thursday edition of Insurance Claims and Bad Faith Blog.                                                                                                                                                                                                                                                         

1. How did it happen that so many lawyers in so many cases used the same language for their Stipulated Protective Orders?  The lawyers in these and other cases used much the same language when they drew up their Stipulated Protective Orders.  Some of that language has already been quoted in past articles posted here.

          At the moment, I have been addressing three unrelated cases from the Central District of California because they were all decided on the same day.  The lawyers in these cases all used the same or substantially similar language when they wrote and signed the proposed orders they sent to the Courts in their separate cases.

         I cannot find a Model Protective Order in the Local Rules of the Central District of California and these stipulations did not reference any.  So where did this same language come from, to which each of these lawyers had the same access?  If any readers know the answer to this question, or if any reader knows of a Model Protective Order, please let me know.  I gratefully appreciate the information in advance.

2. Who drew up these stipulations for protective orders in these cases?  In many cases it is impossible to tell who drew up the Stipulated Protective Orders that somehow find their way to Judges and Magistrates, who sign them.  In most cases, the dockets just do not reveal how these proposed orders got to there in the first place.

          In at least one of these three cases, on the other hand, the docket reveals who filed the proposed order.  Clearly, the party that files the proposed order is the party that wants it the most.  It is reasonable to assume of course that the party that wants it the most is also the party that wrote it.  In the Orellana case, it was Target, the main defendant, that filed the proposed Stipulated Protective Order.   Orellana v. Target Corp., DE 30, proposed Stipulated Protective Order (C.D. Cal. Case No. 2:20-cv-06665 SVW (KSx)). 

3. What do they mean when they say "return or destroy" any material in "any format reproducing or capturing any of the Protected Material"?  In basic terms, a "return or destroy" provision requires that a person bound by the Protective Order shall either return what all the lawyers call "Protected Material" in all these cases, or destroy it.  The Premier Valley Bank stipulation in a fourth case is typical.  The Premier Valley Bank case was also decided on March 26, 2021, but in the Eastern and not the Central District of California.  It is typical in this regard not only among the subset of what has now become four cases, but it is also typical of the SPO case law at large.

         The Premier Valley Bank stipulation contains the requirement in its "return or destroy" provision that "'all Protected Material' includes all copies, abstracts, compilations, summaries, and any other format reproducing or capturing any of the Protected Material."  Premier Valley Bank v. Nguyen, No. 1:20-CV-00900-NONE-EPG, 2021 WL 1164684, ¶ 13,  at *7 (E.D. Cal. March 26, 2021) (emphasis added).  What does this mean?  Each of the three Central District cases contains the identical language that has been quoted here.  However, none of these cases offers much if any insight into what this language means.

         In particular, the reach of this provision to "any other format" "capturing any of the Protected Material" is vague.  It is also overly broad.  A Nondisclosure Agreement purporting to keep matters from being disclosed was recently held void for vagueness and overbreadth in Denton v. Donald J. Trump for President, Inc., No. 20 Civ. 4737 (PGG), 2021 WL 1198666 (S.D.N.Y. March 30, 2021).  If the same reasoning is applied to the language quoted here, it too should be held "invalid and unenforceable" for the same reasons.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

(Image = Editing,  LexisNexis.)

THREE FROM THE C.D.: "GOOD CAUSE STATEMENT" IN ALL OF THEM.

(Editing.  Lexis/Nexis)

Continuing our look at the three cases decided by Magistrates in the Central District of California on the same day (March 26, 2021), each of the three contained orders with this same language in the lawyers' "Good Cause Statement":

This action is likely to involve ... private information for which special protection from public disclosure and from use for any purpose other than prosecution of this action is warranted.

(Italics and boldface added.)¹

          In each case, this is the opening statement of the lawyers' Good Cause Statement, their lede if these were journalists writing a report for a newspaper, presenting their Statement of Good Cause to the Judge so that she or he will enter this protective order.

          The first question that arises from this single sentence is what exactly is the "private information" the lawyers had in mind?  Presumably, the rest of their Good Cause Statement will tell you, their reader, all they want you to know.  You be the judge.  Whether what the lawyers tell you is enough for you to know what they are talking about when they say, "private information," is up to you just as it will be up to their judge.

          A second question concerns when and whether "special protection from public disclosure" is "warranted."  In the past, Courts in the Ninth Circuit where these orders were entered have struck down so-called "confidentiality" provisions based on a statement that the lawyers would only designate things as "confidential" when they had a "good faith belief" that the things were in fact confidential.

         In each of these cases decided on March 26th, "good cause" was mentioned exactly once after the title.  Lawyers who practice in Federal Court know that they can only obtain a protective order for "good cause shown" to the Federal Court.  After the title of their Good Faith Statement in these three cases, the lawyers wrote a long paragraph without ever referring to "good cause," until they reached the end.  Then they declared that they would designate information "confidential" only when they had a "good faith belief" that the information they designate "confidential" is, in fact, confidential and that there is "good cause" to seal it from public view.  The reason that the old language was rejected by the Courts in the Ninth Circuit (and by many Courts in other Circuits) is because it gave too much power to the vague "good faith beliefs" of lawyers.

          Unfortunately, this present language is not an improvement over the past.  It is nondisclosure in a new shroud.  The new suffers from the same illness as the old.

          Last but far from least is the most important thought of all behind the Stipulated Protective Order.  The lawyers declare that they all seek special protection from public disclosure in their unique cases -- so unique that the same exact words are used by every lawyer in three separate cases -- "from use for any purpose other than prosecution of this action."

          I have been involved in trials since the 1970s.  I know enough  about trials to wonder what information is EVER used exclusively for "prosecution of this action," such that you would want to bar its use "for any purpose other than prosecution of this action."  I can't think of any.  Do you think otherwise?

          The real purpose comes clear now.  The real purpose is to prevent the use of information concealed by the lawyers in one case ever to be used in any other case "other than prosecution of this action."

To be continued ....

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

¹I do not like ellipses much.  Those are the three periods (...) that indicate that what we are reading is not the full quote.  As noted, the opening words of the Good Cause Statement are substantively identical in each of the "three cases from C.D.," with a few variations on the words chosen by the different lawyers in the different cases.  Here then is the statement in full:

This action is likely to involve commercial, financial, proprietary, and/or other private information for which special protection from public disclosure and from use for any purpose other than prosecution of this action is warranted.

This or very similar language is found in Diarian, 2021 WL 1163962, at *1; Orellana, 2021 WL 1163234, at *1 (which adds the words that this action is likely to involve "trade secrets, pricing lists and other valuable research, development" and "technical"), and Ramos, 2021 WL 1163575, at *1 (which substitutes the word, "confidential," for "commercial" in the above-quoted provision).

PUMPING OUT PROPOSED SECRECY ORDERS, GOOD CAUSE IN HIDING.

(Image via Central District of California website)

In three cases decided on the same day, three different U.S. Magistrate Judges in the Central District of California granted three of the same Stipulated Protective Orders, without saying why.

          Each of the three Stipulated Protective Orders said the same thing, except in one case the parties added the additional words I have [bracketed] in the quotation below:

[Disclosure and discovery activity] Discovery in this action [are] is likely to involve production of confidential, proprietary, or private information for which special protection from public disclosure and from use for any purpose other than prosecuting this litigation may be warranted. Accordingly, the parties hereby stipulate to and petition the Court to entire the following Stipulated Protective Order.

          We may never know why any of these three actions actually required "special protection from public disclosure" and "from use" beyond use in the lawsuit.  Not a single one of the three proposed Stipulated Protective Orders said what the case was about.

          Neither did the Magistrate Judges say what any of the cases was about in any of these three orders.

          Each of the three Magistrate Judges said that they entered the Stipulated Protective Orders because the parties in the case showed "good cause," but we will never know what the good cause shown may have been because none of the three said in any of the three cases what was shown or by whom or when, at least before they entered their orders.

          These are the three cases:  

Diarian v. First Transit, Inc., No. 2:20-cv-02957-FMO (AFMx), 2021 WL 1163962 (C.D. Cal. March 26, 2021) (Alexander F. MacKinnon, USMJ);

Orellana v. Target Corp., No. 2:20-cv-06665 SVW(KSx), 2021 WL 1163234 (C.D. Cal. March 26, 2021) (Karen L. Stevenson, USMJ), and

Ramos v. FCA US LLC, No: 2:20-cv-10440-DMG-AGR, 2021 WL 1163575 (C.D. Cal. filed March 26, 2021) (Alicia G. Rosenberg, USMJ).

We are not done.  To be continued ....

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

IT MIGHT ABUSE DISCRETION, BUT HAPPY ST. PATRICK'S DAY ANYWAY!

 

(Photo by Dennis Wall)

"The district court abused its discretion in permitting Defendants and the DEA to file their pleadings under seal."  In re:  Nat'l Prescrip. Opiate Litig. (HD Media Co. v. U.S. Dep't of Justice), 927 F.3d 919, 939 (6th Cir. June 20, 2019).

           The appellate panel followed this reasoning tree. First, there is a distinction in the Sixth Circuit (as in many courts) "between secrecy in the context of discovery," which is subject to a "good cause" showing, "and secrecy in the context of adjudication, which is generally impermissible due to the 'strong presumption of openness' of court records."  In re:  Nat'l Prescrip. Opiate Litig., 927 F.3d at 938-39 (emphasis added).  The line of demarcation between discovery and adjudication is crossed when the material in question is put in the court file.  At that point, the public presumptively has access to it.  See In re:  Nat'l Prescrip. Opiate Litig., 927 F.3d at 939.

           This "strong presumption in favor of openness" can be overcome and documents can be sealed from public view when, first, the party seeking to seal the information shows a compelling reason to seal them and, second, the seal is "'narrowly tailored to serve that reason.'"  In re:  Nat'l Prescrip. Opiate Litig., 927 F.3d at 939 (citations omitted).

           This case dealt with the issue of sealing or redacting "pleadings, briefs, or other documents that the parties have filed with the court, as well as any reports or exhibits that accompanied those filings[.]"  In other words, it was not merely the sealing of "pleadings and briefs" filed in the court file that was at issue in this case.  Also at issue was the sealing of "any reports or exhibits" attached to them and therefore also "filed with the court[.]"  These are all "the sort of records" subject to the presumption of public access and therefore subject to the compelling-reasons-and-narrowly-tailored standard before such records may be sealed away from public view.  See In re:  Nat'l Prescrip. Opiate Litig., 927 F.3d at 939.

           In this case, these documents also merited a further, stronger presumption "in favor of openness, ... given the paramount importance of the litigation's subject matter."  In re:  Nat'l Prescrip. Opiate Litig., 927 F.3d at 939.

            Following this reasoning tree to the end, a two-judge majority on the appellate panel held that "[t]he district court abused its discretion in permitting Defendants and the DEA to file their pleadings under seal."  In re:  Nat'l Prescrip. Opiate Litig., 927 F.3d at 939.

The panel's ruling has never been appealed.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

PRESUMPTION OF PUBLIC ACCESS, BUT NO REVERSAL IN FIFTH CIRCUIT.

(Photo © Dennis J. Wall)

Of all Federal Courts, one of the ones you might least expect to uphold the presumption of public access to court records is the Fifth Circuit Court of Appeals.  Yet that is exactly what they have done.

           In what the Court itself described as a "run-of-the-mill case," a unanimous panel chose to identify the differences among a protective order, a stipulated protective order, and sealing evidence.  The entire opinion is worth reading. 

           Here is the reason for decision:

    Judicial records belong to the American people; they are public, not private, documents. Certainly, some cases involve sensitive information that, if disclosed, could endanger lives or threaten national security. But increasingly, courts are sealing documents in run-of-the-mill cases where the parties simply prefer to keep things under wraps.

    This is such a case. The secrecy is consensual, and neither party frets that 73 percent of the record is sealed. But we do, for three reasons. First, courts are duty-bound to protect public access to judicial proceedings and records. Second, that duty is easy to overlook in stipulated sealings like this one, where the parties agree, the busy district court accommodates, and nobody is left in the courtroom to question whether the decision satisfied the substantive requirements. Third, this case is not unique, but consistent with the growing practice of parties agreeing to private discovery and presuming that whatever satisfies the lenient protective-order standard will necessarily satisfy the stringent sealing-order standard.

Hoa Le v. Exeter Fin. Corp., ___ F.3d ___, No. 20-10377, 2021 WL 838266, at *5 (5th Cir. March 5, 2021).

           After losing its head in this rousing tribute to public access, the Fifth Circuit panel returned to its normal and affirmed a summary judgment for the defendant.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

HEARING WITHOUT FORM, SEALING WITHOUT GOOD CAUSE SHOWN.

Courtroom (Pacific Standard)

In Hunter v. Booz Allen Hamilton, Inc., No. 2:19-cv-411, 2021 WL 790208 (S.D. Ohio March 2, 2021) (Vascura, USMJ), a U.S. Magistrate Judge held an "informal" conference during which she formally ruled.

    The plaintiffs in the case requested an "informal" conference to resolve their dispute with the defendants over the defendants' response to production requests.  Hunter, 2021 WL 790208, at *2.   They got their wish.  The Magistrate Judge held the conference and resolved the dispute by ruling that the Defendants need not supplement their production.  She repeated this ruling in a written opinion issued by the Court.  Hunter, 2021 WL 790208, at *2.     

    After issuing a formal ruling at an "informal" conference in Court, and confirming it in writing, the Magistrate Judge officially issued another ruling that the Clerk of Court should mark "SEALED" all the documents that the parties submitted during the conference and that the parties had marked "Confidential" or "Highly Confidential."  Hunter, 2021 WL 790208, at *4.   That was enough for the Magistrate.  There was no other "good cause" shown for sealing the documents.

   Federal Rules of Civil Procedure 5.2(e) and 26(c)(1) both require a showing of good cause before documents and other evidence can be sealed by a Federal Judge or Magistrate Judge.  With the exception of Hunter v. Booz Allen Hamilton, Inc., of course.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

GIVING SHAPE TO SHAPE-SHIFTING STIPULATED PROTECTIVE ORDERS: GOOD CAUSE.

Editing.  (LexisNexis)

"The parties must provide the requisite good cause, which is missing from their pending motions."  Thus did the Court succinctly summarize its ruling in Ramos v. Continental Auto. Sys's, Inc., No. 18-1900-pp, 2020 WL 8617482, at *1 (E.D. Wis. Sept. 3, 2020). 

    In the eyes of the Federal judge in that case, the parties and their lawyers showed no more good cause than their agreement to keep various things "confidential."  This by itself was not good cause, the Court ruled:

    The court acknowledges that the parties have stipulated that they will maintain the confidentiality of certain documents. Paragraph 8 of their stipulated protective order states that all confidential information that is filed with the court must be filed in an envelope marked sealed and such information shall be kept under seal until further order of the court. Dkt. No. 19 at 5; Dkt. No. 20. However, this court requires that the parties comply with General Local Rule 79(d) and Seventh Circuit case law, providing good cause for the requested relief.

Ramos, 2020 WL 8617482, at *1.

     The requirement of good cause determined the outcome.  In moving to seal certain documents, the party requesting confidentiality did not show good cause at that time.  The lack of good cause took the vitality out of that request.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

NO SECRETS ON GEORGE WASHINGTON'S BIRTHDAY & NEVER IN SIXTH CIRCUIT.

George Washington Statue (University of Washington)

In Sweeney v. Nationwide Mut. Ins. Co., No. 2:20-cv-1569, 2020 WL 8265654 (S.D. Ohio Oct. 6, 2020), a United States Magistrate Judge applied settled Sixth Circuit case law and denied permission to file an Amended Class Action Complaint in secret and under seal.

    The excuse offered by the parties in that case was that they had agreed to keep things a secret that showed up in the amended complaint.  "The parties’ agreement to maintain confidentiality, standing alone, does not constitute a compelling reason for filing under seal."  Sweeney, 2020 WL 8265654, at *1.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

THIS FEDERAL JUDGE GAVE A DAMN.

 

(Thomson Reuters West via LinkedIn)

PUBLIC ALLOWED TO ACCESS TESTIMONY ABOUT MEDICAL IMPLANTS THAT ALLEGEDLY MAIM AND KILL.

"This multidistrict litigation proceeding ('MDL') involves personal injury cases brought against Defendants C. R. Bard, Inc. and Bard Peripheral Vascular, Inc. (collectively, “Bard”). Bard manufactures and markets medical devices, including inferior vena cava ('IVC') filters. The MDL Plaintiffs have received implants of Bard IVC filters and claim they are defective and have caused Plaintiffs to suffer serious injury or death."  In re:  Bard IVC Filters Prod's Liab. Litig., No. MDL 15-02641-PHX-DGC, 2021 WL 462592, at *1  (D. Ariz. MDL Case No. 15-02641-PHX-DGC Feb. 9, 2021).

           The Court explained what an IVC filter is made to do:  "The IVC is a large vein that returns blood to the heart from the lower body. An IVC filter is a small device implanted in the IVC to catch blood clots before they reach the heart and lungs."  Bard IVC Filters, 2021 WL 462592, at *2.

           The Court also summarized the plaintiffs' claims as a result of allegedly suffering "serious injury or death" from their use of the defendants' IVC filters:

           The MDL Plaintiffs allege that Bard filters are more dangerous than other IVC filters because they have higher risks of tilting, perforating the IVC, or fracturing and migrating to vital organs. Plaintiffs further allege that Bard failed to warn patients and physicians about these higher risks.

Bard IVC Filters, 2021 WL 462592, at *3. 

           The defendants defended on many grounds not pertinent to this particular article.  What is pertinent are the defendants' claims that voluminous deposition testimony should not be made available to the public, nor should the public see reams of documents, all introduced at trial.

           In this case, the Court disagreed.  The Court attached an Exhibit to the Order cited above listing the testimony and exhibits that were introduced into evidence at a bellwether trial in this Multi-District Litigation, and that the Court held accessible by the public despite the parties' Stipulated Protective Order and despite the defendants' claims of confidentiality.

           This Court's landmark ruling and detailed list of dozens of depositions and multiple Trial Exhibits can be found here:  In re:  Bard IVC Filters Prod's Liab. Litig., Doc. No. 21727-2, Court's List of Publicly Accessible Trial Testimony and Exhibits, Filed Nov. 13, 2020 (D. Ariz. MDL Case No. 15-02641-PHX-DGC), Download In re Bard IVC Filters Prods Liab. Litig. Doc. No. 21727-2 Court's List of Publicly Accessible Trial Testimony and Exhibits at a Bellwether Trial Not Confidential Filed Nov. 13 2020 (D. Ariz. MDL Case No. 15.02641.PHX.DGC).

           The Court's treatment of these arguments is noteworthy for several reasons, among them that an ancillary purpose of an MDL, not the main purpose certainly but nonetheless in the reported cases a side-effect if you will, is to shield from public view allegedly harmful behavior on a massive scale.

Another reason is the time it must have taken and the resources that were required to address these issues and compile this list in massive litigation like this.

           This federal judge clearly gave a damn.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

CHALLENGING CONFIDENTIALITY OF "CONFIDENTIAL" DESIGNATIONS: FOUR RULES TO LIVE BY.

 

(Image by NASA)

 

Lawyers tend to write broadly when they write stipulations for protective orders.  They give themselves powers to designate evidence "Confidential" and "Highly Confidential -- Outside Attorneys' Eyes Only."  This is what they did in their stipulated protective order in the case of Edwards Vacuum, LLC v. Hoffman Instr. Supply, Inc. d/b/a His Innov's Grp., No. 3:20-cv-1681-AC, 2021 WL 186932 (D. Or. January 19, 2021).

Except that in that case the lawyers' powers were challenged.  Well, more precisely, some of the powers exercised by some of the lawyers were challenged.

The plaintiff's attorneys designated a lot of deposition testimony either as "Confidential" or as "Highly Confidential."  The defendants challenged these designations with a "Motion to Compel De-Designation of Certain Deposition Testimony."   The defendants' motion was granted in part and denied in part, but the lesson that this case holds lies much more in the way in which the Court reached its decision, than in the decision in this particular case.

"Four legal principles are particularly relevant to Defendants' motion to de-designate, or redesignate, the confidentiality restrictions under the Protective Order of certain deposition testimony of Plaintiff's witnesses."  Edwards Vacuum, 2021 WL 186932, at *1.

Transcribed into a numbered list, here are the four legal principles which this Court applied when one set of lawyers requested relabeling the "Confidential" and "Highly Confidential" designations that another set of lawyers had  placed on deposition testimony:

    1.    The first legal principle, said the Court, was "'well-established,'" which it is at least in the Ninth Circuit where this District Court sits. That is the legal principle that discovery is "'presumptively public'" unless and until a Court has ordered otherwise.  Edwards Vacuum, 2021 WL 186932, at *1.

    2.    "Second, a party's confidentiality designations must be reasonably and narrowly tailored to protect the confidential information the party seeks to shield from further disclosure. In other words, an 'across-the-board' designation is improper, even if some confidential information may be found within the broader designation. As several district courts have explained, a party misuses a protective order when it over-designates discovery materials in that way."  Edwards Vacuum, 2021 WL 186932, at *2.

       3.    "Third," the parties' stipulation for a protective order was written by the lawyers and not by the judge. A stipulated protective order is not dispositive of the outcome even when a stipulation written by the lawyers is accepted by the Court for an order.  In other words, "the fact that the parties may have stipulated to a protective order is not itself a basis for sealing or otherwise restricting access to any specific discovery material."  Edwards Vacuum, 2021 WL 186932, at *2.

    4.    "Finally," said the Court, numerous decisions have established that "'mere embarrassment'" is not enough. Good cause for a protective order requires much more.  If embarrassment is involved, then the embarrassment must "'be particularly serious or substantial'" in order to demonstrate good cause for a judge to enter a protective order.  Edwards Vacuum, 2021 WL 186932, at *2.

The District Judge in this case applied these four legal principles to the deposition testimony which had been designated "Confidential" or "Highly Confidential" by one set of attorneys in the case.  The judge took unusual pains to review and report his rulings on what must have been several hundreds of pages of testimony from four witnesses.  See Edwards Vacuum, 2021 WL 186932, at *4-6.

The extraordinary effort by the District Judge in this case is worthy of attention and, more than that, worthy of high praise.  But the lesson of this case is not in the decision itself, as was said earlier.

The lesson of this case is in the Court's summary of four mandates, four "legal principles," required by the case law of any stipulated protective order submitted by the lawyers in any case.

Please read the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

ONCE SECRET, ALWAYS SECRET? MAYBE, IF IT'S A STIPULATED ORDER.

 

A physician named Jalowsky was represented in an insurance bad faith case by lawyers who had received discovery in an earlier case from the current defendants, the Unum Group of insurance companies.

Dr. Jalowsky "intends to issue" a subpoena for the information from his own attorneys.  However, the attorneys had received the information subject to a protective order, apparently a stipulated protective order, in the earlier litigation.

The order provided that the information could only be used in the earlier case.  It is common for stipulated orders to have an "only-in-this-case" limitation on the use of evidence.

After discovery closed in the bad faith case, Dr. Jalowsky's lawyers asked Unum for permission to use the evidence in question in the bad faith case, a delay which was fatal in the eyes of the Magistrate Judge, as it turned out.  We may never know what the result might have been if, as the Magistrate Judge suggested, the attorneys had carefully crafted a timely request for production of the same materials in the insurance bad faith case.

In any event, Unum refused Dr. Jalowsky's request to use the materials in question in his insurance bad faith case.

Rather, Unum filed a motion to quash the subpoena and for a protective order.  To say again, the Court revealed that Jalowsky "intends to issue a subpoena" -- how and through whom, it is not clear from the opinion -- against his own attorneys for documentation they had gotten ahold of in the earlier litigation.

The U.S. Magistrate Judge quashed the subpoena and granted Unum's motion for (another) protective order.  The material in question was subject to an order in the earlier case which limited the use of that material to that case, meaning the case in which the material was produced in the first place.  There are no exceptions, said the Magistrate Judge in Jalowsky v. Provident Life & Acc. Ins. Co. and Unum Grp., No. CV 18-279-TUC-CKJ (LAB), 2020 WL 8184343, at *1 (D. Ariz. June 19, 2020) (USMJ).

Counsel for plaintiffs should exercise caution when entering into stipulations for secrecy:  Their clients in later cases may be barred from using the evidence in their cases.

Counsel for defendants should be aware of the same thing.

Please see the disclaimer.  ©2021 Dennis J. Wall.  All rights reserved.

U.S. MAGISTRATE JUDGE NAILS THE LAW OF STIPULATED PROTECTIVE ORDERS.

 

(Pacific Standard)   A United States Magistrate Judge nailed it in American Fam. Mut. Ins. Co. v. Whirlpool Corp., No. 1:20-cv-00302-WCL-SLC, 2021 WL 118826 (N.D. Ind. January 12, 2021).  Specifically, she nailed a proposed stipulated protective order, sending it back to the lawyers for corrections.

First, the proposed protective order submitted by the lawyers in this insurance coverage case "fails to set forth narrow, demarcated categories of legitimately confidential information. Instead it defines 'Confidential Information' with vague categories such as 'confidential business and commercial information, contracts, and other highly confidential proprietary information....' (ECF 18 § C). Generic terms such as 'confidential,' 'proprietary,' and the like are far afield from a narrowly demarcated category."  American Family Mutual Insurance Co., 2021 WL 118826, at *1.

Next, the proposed stipulation to secrecy did not present legally sufficient reasons for a protective order from a Federal Court sitting in the Seventh Circuit.  The lawyers were required instead to describe the information to be sequestered from public view, and then to "'show that substantial privacy interests outweigh the presumption of public access to discovery material.'"   American Family Mutual Insurance Co., 2021 WL 118826, at *1.

Further, the stipulated order submitted in this case proposed that the Court retain jurisdiction over the parties after the litigation ended.  "The Court, however, is unwilling to enter a protective order that suggests it retain jurisdiction of any kind after resolution of the case."   American Family Mutual Insurance Co., 2021 WL 118826, at *2.

"Finally," the U.S. Magistrate Judge ruled, that the proposed protective order in this case failed because it was not "'explicit that either party and any interested member of the public can challenge the secreting of particular documents.' [Citizens First Nat'l Bank of Princeton v.] Cincinnati Ins. Co., 178 F.3d [943,] at 946 [(7th Cir. 1999).]. The instant proposed order, however, does not contain this language. '[T]he public at large pays for the courts and therefore has an interest in what goes on at all stages of a judicial proceeding.'  Id. at 945.”  American Family Mutual Insurance Co., 2021 WL 118826, at *2.

There are one or two more points that the U.S. Magistrate Judge made in her concise, cogent opinion in this case.  What has been summarized here is enough to show that she nailed it.

The name of the United States Magistrate Judge?  Susan Collins.

Remember that name!

Please read the disclaimer.  ©2020 Dennis J. Wall.  All rights reserved.

"WHERE'S THE BEEF?" WHERE'S THE PUBLIC IN THIS?

(Florida Department of Agriculture and Consumer Services)

"Plaintiff David DeHate filed his complaint on October 18, 2019, alleging claims for negligence and premises liability arising from an incident at defendant's store in Hemet, California, in which a former employee of defendant allegedly dropped a pallet of flooring material on plaintiff's foot."  DeHate v. Lowe's Home Ctrs., LLC, No. ED CV 19-2505-JGB (SPx), 2020 WL 7084551 (C.D. Cal. Oct. 8, 2020) (USMJ).

Plaintiff filed suit against Lowe's for alleged negligence and premises liability, and Lowe's removed the case to federal court.  In light of subsequent rulings, certainly, this was a good tactical move.

Lowe's had a surveillance video which showed the accident apparently.  From the beginning of the suit, DeHate asked Lowe's to give him the surveillance video and documents related to the accident.  Likewise, once the lawsuit was removed to federal court, Lowe's never stopped asking for a stipulated protective order that would limit use of the surveillance and any of the documents to DeHate's use in this lawsuit only.

Ultimately, Mr. DeHate's lawyer verbally agreed to limit use of the material to the current lawsuit only.  This was not good enough for Lowe's, which understandably wanted the agreement committed to writing.  Lowe's filed a motion for a protective order, there being no stipulated protective order.

Viewing the surveillance tape would reveal the location of the cameras in the Lowe's store.  If that information was released to third parties outside the lawsuit, the world would know, essentially, where the cameras were hidden in that store.  "Shoplifters beware," was basically Lowe's cry about the surveillance tape.  The Magistrate heard the cry, looked at the record in this case, and granted the motion for protective order regarding the surveillance video.  See DeHate, 2020 WL 7084551, at *3.

The documents in question reflect Lowe's surveillance practices and procedures so they too were ruled protected here.    DeHate, 2020 WL 7084551, at *3.

These rulings came without discussion of any public interest in access to these materials.  Perhaps the public had no interest given the nature of the materials, but perhaps it did.  We do not know because there was no discussion in the Magistrate's opinion.  Consideration at least of the public's interest in access to judicial proceedings seems to be a requirement in the Ninth Circuit where the Central District of California -- in which these rulings were made -- is located of course.

If Lowe's asked for a protective order, it had to show the Court what it wanted the Magistrate to protect.  To protect those materials from public view, Lowe's would ordinarily have had to request that they be sealed before Lowe's filed them with its motion for a protective order.  Yet there is no mention of this in the opinion.

Further, Ninth Circuit case law apparently would treat the motion in this case as a "non-dispositive motion" but would still require the moving party to show "good cause" for the secrecy.  Lowe's may have satisfied this standard; certainly this Magistrate was satisfied with two declarations which Lowe's filed in support of its motion.  One declaration was from the store manager; the other declaration was from the lawyer for Lowe's.  See DeHate, 2020 WL 7084551, at *1-*4.  But if Lowe's satisfied the "good faith" standard, we do not know because this Magistrate did not address the question.

We only know that the Magistrate said that her rulings were good for the parties.  She balanced DeHate's and Lowe's' interests here.  DeHate, 2020 WL 7084551, at *4.  That is as far as she went, however.  Her rulings were like a return to the "before time," when publicly funded litigation was viewed strictly as the private preserve of private parties.

She did not put the public's interest on her scales and balance the public's interest in accessing any of the materials, however.   The public's interest in access to judicial proceedings is guaranteed by the Constitution and by the common law in most American jurisdictions.  As a result, that interest is not lightly ignored.

The point is not that this Magistrate's discovery rulings were wrong.  She may have been right ultimately.  But the point is greater than that:  Because she did not tell us where the public came in, we will not know whether and what role the public right of access may play here, will never know how the interests of the public may affect disclosure of any of the materials at issue in this discrete case.  That seems to be why the Ninth Circuit has shaped procedures for judges and magistrates to follow in all cases.

That the Magistrate did not follow them in this case is a loss for the Court system and for the public, which pays for that system.

Please read the disclaimer.  ©2020 Dennis J. Wall.  All rights reserved.

SAYIN' DON'T MAKE IT SO: "CONFIDENTIAL" DESIGNATIONS v. PUBLIC RIGHTS.

(Image by NASA)

The recent decision in Plexxikon Inc. v. Novartis Pharm's Corp., No. 17-cv-04405-HSG, 2020 WL 7027432 (N.D. Cal. November 30, 2020), explores what seems to be all the necessary issues that surround getting a Federal Court to seal a document in a case in the Ninth Circuit and perhaps the nation.

First, there is the question of the American public's right of access to documents filed in court cases.  If the document is part of a filing submitted to a Court when asking the Court for a ruling, then the document is presumptively accessible to the public and it cannot be sealed without a showing of "extraordinary circumstances."  Plexxikon Inc., 2020 WL 7027432, at *1.

In contrast, if the document is not part of a filing designed to elicit a dispositive ruling from the Court, i.e., if it is attached to "a non-dispositive motion," then the party seeking to seal it must instead show "good cause" to seal it.  The showing of "good cause" to seal is a "particularized showing" of specific harm or prejudice that would happen to the party seeking to seal a document if the document is not sealed.  Plexxikon Inc., 2020 WL 7027432, at *2.

In either situation, the party asking a judge to seal a document must do more than say that it is "confidential" or "highly confidential" just because a stipulated protective order allows that party to say those words.  In the view of the federal judge in this case, that is all that the party did when it asked the Court to allow it to file a second motion for summary judgment, asked the Court to seal attachments to its motion requesting leave, and also asked the Court to seal the party's objections to a Magistrate's Recommendation against sealing.  Plexxikon Inc., 2020 WL 7027432, at *2-*3.

Saying that the documents were "highly confidential" did not make them so, the Court ruled in effect.

The sealing motions were denied even applying the lower standard of "good cause" in this case.  Plexxikon Inc., 2020 WL 7027432, at *3.

Please read the disclaimer.  ©2020 Dennis J. Wall.  All rights reserved.

"GOOD FAITH BELIEF" IN A STIPULATED PROTECTIVE ORDER: WHOSE BELIEF?

Stipulated protective orders pretty universally require a "good faith belief" that the materials being marked "Confidential" are, in fact, worthy of being marked Confidential.  But whose good faith belief are we talking about?

(Photo by Peter Dejong/AP)

In some cases, this apparently means a good faith belief by the lawyers who marked the thing "confidential" in the first place.  See, e.g., Davey's Locker Sportfishing, Inc. v. Amco Ins. Co., No. 8:20-cv-01424 JVS (JDEx), 2020 WL 6681858, at *1, GOOD CAUSE STATEMENT (C.D. Cal. Nov. 12, 2020) (Stipulated Protective Order signed by USMJ; boldface in original).

In other cases, this expressly constitutes "a representation by the party or nonparty and its counsel that they believe in good faith" that the material designated "confidential" is, in fact, confidential.  See, e.g., Mullins v. Humana Health Plan, Inc., No. 4:20-cv-00192-CDL, 2020 WL 6706364, at *1, ¶ 3 (M.D. Ga. Nov. 13, 2020) (Definition of Confidential Material in Stipulated Protective Order signed by U.S. District Judge; italics in original).

In still other cases, the last remaining alternative is written in the Stipulated Protective Order and the requisite "good faith" belief comes from "the producing party[.]"  Multicare Health Sys. v. National Fire & Marine Ins. Co., No. C20-5559 TSZ, 2020 WL 6700924, at *1, ¶ 2 (W.D. Wash. Nov. 13, 2020) ("'CONFIDENTIAL' MATERIAL" paragraph in Stipulated Protective Order signed by U.S. District Judge; all caps in original).

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WRITING STIPULATED PROTECTIVE ORDERS: AN ART WITH MANY FOLLOWERS.

One of the reasons that Stipulated Protective Orders all tend to look alike even though they are submitted to different judges and magistrates in different cases, is that Stipulated Protective Orders are available on PACER (Public Access to [Federal] Court Electronic Records), and via Westlaw and LexisNexis, among other online venues.  If an order works in one case, it is likely to be used in another case, and another case, and so forth.

    Another reason that SPOs look alike from case to case to case across the country is that many of these proposed Stipulated Protective Orders are written by the same counsel even though they are submitted to different courts for approval.  Often, the lawyers involved represent the same clients and submit similar orders in many cases all across the United States.  See, e.g., Bedivere Ins. Co. v. Blue Cross & Blue Shield of Kansas, Inc., No. 18-cv-02515-DDC, 2020 WL 1140394 (D. Kan. March 9, 2020).  A couple of things are illustrated by the Stipulated Protective Order signed by the Magistrate Judge in what might be called the Bedivere example.

    Bedivere is a civil case pending in Kansas.  Attorneys of record listed on the Court's docket in this civil case list their home towns as Miami and Tampa, Florida; San Diego and Costa Mesa, California; and Chicago, in addition to, in this case, Kansas City, Missouri. There are no appearances of counsel shown on the Court's docket in this case that show any counsel from Kansas where this case is pending.

    Second, the Bedivere example illustrates that the March 9, 2020 Stipulated Protective Order entered in this case in Kansas contains the same exact language leading into its provisions as many other Stipulated Protective Orders entered on this date in different federal courts around the country.

    All of this takes nothing away from the quality of the representation provided by the lawyers in the Bedivere case or in any other case, for that matter.  "The point is rather that writing Stipulated Protective Orders is an art with many followers."

The use of Stipulated Protective Orders in the decided cases including the Bedivere case is discussed based on the decided case law in Third-Party Cases in § 3:107, Settlement of Third Party Bad Faith Claims: Confidentiality (Protected) or Concealment (Void), in 1 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH (Thomson Reuters West, 3d Edition, forthcoming 2020 Supplement) (and from which the quotation is taken from the forthcoming 2020 Supplement).  The use of Stipulated Protective Orders in First-Party Cases is, in turn, discussed based on the decided case law in First-Party Cases in § 9:28, Settlement of First Party Bad Faith Claims: Confidentiality (Protected) or Concealment (Void), in 2 id.

Please read the disclaimer. ©2020 Dennis J. Wall. All rights reserved.

DECLARING A THING "CONFIDENTIAL" IS NOT ENOUGH.

It is getting a little harder to get judges to sign Stipulated Protective Orders in some courts. "Designation as 'Confidential' is not sufficient, as that is merely the parties' initial designation of confidentiality to establish coverage under the stipulated protective order." Ortiz v. City and County of San Francisco, No. 18-cv-07727-HSG, 2020 WL 2793615, at *9 (N.D. Cal. May 29, 2020).

Please read the disclaimer. ©2020 Dennis J. Wall. All rights reserved.

"GOOD CAUSE" OR NO "GOOD CAUSE": THAT IS THE QUESTION.

This new article is drawn from research for the manuscript of the 2020 Supplement of LITIGATION AND PREVENTION OF INSURER BAD FAITH, which I have just completed:

The requirement of establishing "good cause" for secrecy was addressed by a recently written provision of a Stipulated Protective Order submitted for signature in a federal court case.  The parties and their lawyers offered the Court their own interpretation of what is and what is not "good cause."

    The so-called good-cause statement in this proposed order was written by an insurance carrier and the individual plaintiff suing it, in Zehtab v. Principal Life Insurance Co., No. 8:19-CV-01649-JLS-KES, 2020 WL 2079987, at *1 (C.D. Cal. April 30, 2020).  Their joint stipulation was clearly an attempt to base all future determinations of "good cause" for secrecy in that case exclusively or primarily on the good intentions of the parties and their lawyers in that case.  (Their proposal also reflects several attempts, one or two for each side in a negotiated agreement, as it were, to stretch the secrecy protection to things not ordinarily deemed worthy of protection under the Constitution and rules.)

    For ease of reference, I have highlighted the significant assertions in the "good cause" provision of this agreed secrecy order:

           B. GOOD CAUSE STATEMENT

The parties anticipate producing certain confidential documents or information in connection with discovery in this matter. Such confidential and proprietary materials and information consist of, among other things, confidential business information, information regarding confidential business practices, or other commercial information, information otherwise generally unavailable to the public, or which may be privileged or otherwise protected from disclosure under state or federal statutes, court rules, case decisions, or common law. Accordingly, to expedite the flow of information, to facilitate the prompt resolution of disputes over confidentiality of discovery materials, to adequately protect information the parties are entitled to keep confidential, to ensure that the parties are permitted reasonable necessary uses of such material in preparation for and in the conduct of trial, to address their handling at the end of the litigation, and serve the ends of justice, a protective order for such information is justified in this matter.  It is the intent of the parties that information will not be designated as confidential for tactical reasons and that nothing be so designated without a good faith belief that it has been maintained in a confidential, non-public manner, and there is good cause why it should not be part of the public record of this case.

Zehtab, 2020 WL 2079987, at *1 (emphasis added).

    Like many other stipulated protective orders, this one appears to have been entered by the Court without change from what the parties wrote.  For one thing, the Westlaw report ends with a California-required "Proof of Service" by one of the lawyers in the case.  Zehtab, 2020 WL 2079987, at *8.  For another, there is not even a signature line for the Judge, although the parties' proposed Stipulated Protective Order does recite that "FOR GOOD CAUSE SHOWN, IT IS SO ORDERED."  Zehtab, 2020 WL 2079987, at *7.

Please read the disclaimer. This blog article ©2020 Dennis J. Wall. All rights reserved.

 

"Oh, Bedvidere! Come here boy!" Foghorn Leghorn goes silent with SPO.

A Stipulated Protective Order was signed in the insurance case of Bedivere Ins. Co. v. Blue Cross & Blue Shield of Kansas, Inc. & Allied World Specialty Ins. Co., Nos. 18-cv-02371 & 18-cv-02515, 2020 WL 1140394 (D. Kan. March 9, 2020) (O'Hara, USMJ). It was written by the parties, all of them insurance companies, and their lawyers of course. The lawyers of record came from Miami and Chicago and California, as well as local counsel from Kansas. They came bearing a proposed stipulated protective order.

    The Clerk wrote this on the Docket Entry for the proposed order, which Westlaw did not pick up in its report: "AGREED PROTECTIVE ORDER. The court finds good cause to enter the order submitted by the parties. Signed by Magistrate Judge James P. O'Hara on 3/9/2020." Bedvidere Ins. Co. v. Blue Cross & Blue Shield of Kansas, Inc., Case Nos. 18-cv-02371-DDC & 18-cv-02515-DDC, DE #88, proposed "Agreed Protective Order," filed March 9, 2020.

    The ones who wrote the proposed order said that their "Agreed Protective Order is based on the District of Kansas Model Protective Order." Bedvidere, 2020 WL 1140394, at *1. Except that it isn't.

    The lawyers included three categories of protection for "confidentiality" that the lawyers select in the first place. Interestingly, the lawyers wrote categories of confidentiality based on lawyers and not on their clients seeing the materials: "In particular, the parties have included three levels of confidentiality -- Confidential, Confidential -- Attorneys' Eyes Only, and Confidential -- Outside Counsel Only[.]" Bedvidere, 2020 WL 1140394, at *1. The District of Kansas Model Protective Order does not include such categories of secrecy, and neither do the District of Kansas Guidelines for the Model Protective Order.

    And what was so important that it has to be kept secret and available only in these two consolidated lawsuits and no others? This is an insurance coverage case. It involves competing coverages under Directors' and Officers' and Errors and Omissions insurance policies. See Download Bedvidere Ins. Co. v. Blue Cross & Blue Shield of Kansas Inc. No. 18-cv-02371-DDC DE #55 Amended Complaint filed 10.14.19 (D. Kan.).

    Very hush-hush indeed.

    Seriously, though: If you can get a stipulated protective order signed to keep your insurance coverage secrets, then what if anything must be disclosed?

Please read the disclaimer. ©2020 Dennis J. Wall. All rights reserved.

 

SECRECY IN DISCOVERY AND SECRECY AT TRIAL ARE TREATED DIFFERENTLY.

In In re: Bard IVC Filters Prod's Liab. Litig., No. MDL 15-02641-PHX-DGC, 2020 WL 1070328 (D. Ariz. March 5, 2020), the District Court faced questions of secrecy claims over discovery materials and also secrecy claimed for trial exhibits. Like most Courts, this one treated the questions differently: Most Courts are willing to indulge secrecy in pretrial discovery but not for exhibits introduced in evidence at trial.

    First, the parties submitted a Stipulated Protective Order "governing the designation, handling, use, and disclosure of confidential discovery materials[.]" As is usual with such stipulated orders, the determination of "confidentiality" was made in the first place by the parties and their lawyers.

    Then a Case Management Order (CMO) "governed redactions of material from additional adverse event reports, complaint files, and related documents in accordance with" HIPAA.

    Third, the parties and their lawyers crafted another SPO specifically for Electronically Stored Information (ESI). "[T]o expedite production of ESI, the parties agreed to a primarily 'no-eyes-on' document production as to relevancy while still performing a privilege review for this expedited ESI document production." A CMO was amended apparently to accommodate this SPO.

    Thereafter the Court conducted three bellwether trials or demonstration trials. In Multi-District Litigation like this MDL, these trials offer a sampling of the likely outcomes. The Court in this case denied the defendants' motion to seal trial exhibits and otherwise to keep them confidential as to each of the three cases that were tried. "A list of exhibits admitted at the bellwether trials (excluding case-specific medical records) and documents deemed no longer subject to the protective order are attached as Exhibit 2." In re: Bard, 2020 WL 1070328, at *7.

    Familiarity with the principles of law is presumed here. The Court did not engage in a long discussion of them. Instead the Court ruled and the context of its rulings are known to people familiar with the principles of law they reflect. This opinion is very much worth reading for the outcomes in this regard.

Please read the disclaimer. ©2020 Dennis J. Wall. All rights reserved.

 

STIPULATIONS, PROTECTIVE ORDERS, GOOD CAUSE AND ... OUTHOUSE OR IN-HOUSE COUNSEL?

The case of Allscripts Healthcare, LLC v. DR/Decision Resources, LLC, d/b/a Decision Resources Group ["DRG"], No. 19-11038-NMG, 2020 WL 837444 (D. Mass. February 20, 2020), is a contract dispute. The defendant, DRG, wanted to tighten the confidentiality of one document beyond even the stipulated protective order that the parties had already obtained in that case. DRG wanted to "enhance" the existing protective order to bar review of one document by the plaintiff's in-house counsel and limit review strictly to the plaintiff's "outside counsel."

The District Judge's resolution of this matter was clear and succinct:

    A party to a stipulated protective order seeking to modify the order must demonstrate good cause for modification. [Citation omitted.]  DRG fails to proffer a persuasive reason for its speculation that Allscripts’ attorneys, who are officers of the Court and bound by the Protective Order, would flout their duty and disclose to Allscripts’ employees information labeled as “Confidential-Attorneys’ Eyes Only” in violation of the Protective Order.

    Accordingly, DRG’s motion to enhance the Protective Order will be denied.

Allscripts, 2020 WL 837444, at *4-*5.

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WHEN PERMISSIVE STIPULATIONS BECOME MANDATORY.

In Sanchez v. County of Sacramento, No. 2:19-cv-01545-MCE-AC, 2020 WL 605882 (E.D. Cal. February 7, 2020) (Claire, USMJ), a U.S. Magistrate Judge ordered all parties to execute a stipulated protective order.

The Local Rules for the Eastern District of California where this ruling was made regulate the Mechanics of Obtaining a Protective Order.  Local Rule 141.1(b) (emphasis in the title of this Local Rule).  On its face, it is clearly permissive, certainly where pretrial discovery like that at issue in this case is involved, not mandatory.  See Local Rule 141.1(b)(1).

If U.S. Magistrate Judges in the Eastern District of California are nonetheless empowered to order the parties to stipulate to secrecy orders, are they also empowered to order the parties to stipulate to anything else? And if not, then what are the limits on their power to mandate stipulations of any kind?

And what becomes of the First Amendment right of public access to court files which is recognized, for example, in the same Local Rules of the Eastern District of California?  See Local Rule 141.1(a).

Please read the disclaimer. ©2020 Dennis J. Wall. All rights reserved.

SECRECY IS DECIDED BY GOOD CAUSE, COMPELLING REASONS, NOT AGREEMENTS.

Just because lawyers and their clients have agreed to keep things a secret does not mean that the Courts must keep those things secret now, let alone for all time.  "Specifically, parties often disregard the precedent that holds, the fact that the Court has entered a stipulated protective order and that a party has designated a document as confidential pursuant to that protective order does not, standing alone, establish sufficient grounds to seal a filed document."  MetroPCS v. AZZ Connection, LLC, No. 2:15-cv-01412-JAD-DJA, 2020 WL 127550, at *5 (D. Nev. January 10, 2020) (Albregts, USMJ).

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DESPITE STIPULATED PROTECTIVE ORDER, SEAL SUBJECT TO GOOD CAUSE SHOWING.

In Karrani v. JetBlue Airways Corp., No. C18-1510 RSM, 2019 WL 2724046 (W.D. Wash. June 28, 2019), the Court applied the Federal Rules of Civil Procedure and the Local Rules of Court to a motion to seal evidence.  The motion to seal already followed after a designation of the evidence as "confidential" pursuant to a Stipulated Protective Order previously approved by the Court in that case.

Despite that, the Court ruled that Federal Rules and Local Rules trump a Stipulated Protective Order when it comes to sealing evidence in the Court file:

Accordingly, a “good cause” showing under Rule 26(c) may suffice to keep under seal documents attached to non-dispositive motions. Id. Rule 26, which gives district courts flexibility in balancing and protecting the interests of private parties, states that “good cause” is shown where forbidding disclosure or discovery would “protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense ….” Fed. R. Civ. P. 26(c).

    The Court’s Local Rules explicitly instruct parties to present legal and evidentiary support in a motion to seal. Normally that motion must include “a specific statement of the applicable legal standard and the reasons for keeping a document under seal, with evidentiary support from declarations where necessary.” Local Rules W.D. Wash. LCR 5(g)(3)(B).

Karrani v. JetBlue Airways Corp., No. C18-1510 RSM, 2019 WL 2724046, at *1 (W.D. Wash. June 28, 2019).

Lesson learned here:  Stipulated Protective Orders are not enough standing alone to provide a basis for sealing evidence in a Federal Court's file.  Federal Rules and Local Rules govern that decision, as in this case, where the Court denied both of the two motions to seal filed by the plaintiff even as the Court directed further compliance with the Stipulated Protective Order that it had previously approved in the case.  Karrani v. JetBlue Airways Corp., No. C18-1510 RSM, 2019 WL 2724046, at *3 (W.D. Wash. June 28, 2019)

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UBER RUN OVER BY ITS OWN STIPULATED PROTECTIVE ORDER.

The City Attorney of San Francisco started an investigation which concerned Uber.  The City Attorney issued administrative subpoenas as the City Attorney was authorized by California law to do.

The administrative subpoenas required Uber to provide reports and data that Uber had previously submitted to the California Public Utility Commission.

Uber's response to the subpoenas was less than "substantial compliance," which triggered a lawsuit by the City Attorney.  The City Attorney requested a court to enforce the administrative subpoenas.

Early in the lawsuit, Uber and the City Attorney entered into a Stipulated Protective Order.  In it, Uber stipulated that its confidentiality interests were fully protected by the Order.

Nonetheless they resisted.

The appellate court affirmed.  "It is Uber's burden to demonstrate that the protective order is inadequate to protect its privacy interests, a burden that Uber fails to meet."  City and County of San Francisco v. Uber Technologies, Inc., No. A153205, 2019 WL 2436750, *10 (Cal. 1st DCA May 17, 2019).

They were for it until they were against it.  The Stipulated Protective Order was great until it wasn't.  That doesn't work in court very often.  It did not work here, that's certain.

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PARTIES STIPULATE "ATTORNEYS' EYES ONLY," MAGISTRATE JUDGE FINALLY SAYS "NO."

In Hyundai Mtr. Am., Inc. v. Midwest Indus. Supply Co., No. 2:17-cv-03010-JCM-GWF, 2019 WL 2411420 (D. Nev. June 6, 2019) (Foley , USMJ), both the defendants and the plaintiffs filed motions to seal testimony and evidence.

Both sides said that they had stipulated to this secrecy.  Both sides said that they had "good cause" to seal this evidence.

In their requests to seal testimony and other evidence, the defendants said:

Defendants represent that such filings contain confidential and proprietary information designated as confidential or for “attorney's eyes only” pursuant to the parties' stipulated protective order. Further, Defendants represent that [one of the witnesses' testimony] contains confidential settlement discussions.

Hyundai Motor America, 2019 WL 2411420 at *1.

Likewise, along with their own requests to seal testimony and other evidence, the plaintiffs said:

Plaintiffs represent that the above documents contain confidential, sensitive and non-public information and is designated as confidential under the parties' stipulated protective order.

Hyundai Motor America, 2019 WL 2411420 at *1.

The Magistrate Judge ruled that the parties had shown good cause to seal neither the testimony nor the documentary evidence that they wanted to keep from public view.  The testimony and the documents had been filed in support of dispositive motions, motions more than "tangentially related" to the issues in the case.  The presumption of public access to court files trumped the parties' stipulation in this case.

So far.  The Magistrate Judge gave the parties in this case until Monday, June 17 to file more motions to seal.

Stay tuned.  Until then, the presumption of public access to evidence that judges rely on in their rulings -- at the request of the same parties that want to keep the evidence secret even though they ask the judge to rule on it -- is prevailing.

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WILL THE SECRECY EVER STOP? WILL PUBLIC ACCESS COURT FILES?

This article continues from the end of the article published here on Wednesday, June 5, 2019.

 

2. Under Secrecy agreements and Secrecy orders like the ones in the People of California v. Wells Fargo case, what was marked "confidential" purportedly stays "confidential" even if it is put in front of the judge.  California Rules of Court 2.550 and 2.551 were written to cover the case of what evidence can be sealed and how someone can go about asking a judge to seal that evidence.  However, neither of these Rules applies to the evidence exchanged between the parties as a lawsuit goes forward, which again is called discovery.

Under the Rules of discovery that are meant to apply to all cases, everybody drops the argument that they have a "right" to conceal evidence once they argue that previously concealed evidence is a part of their case.  This includes when they give the judge the evidence they previously marked "confidential" in an effort to get a favorable ruling from the judge on one of their motions. 

Secrecy agreements and their secrecy orders like the ones in the People of California v. Wells Fargo case make the exchange of evidence during litigation more of a joint exercise in concealment than a concerted effort at discovering the truth, or at least discovering evidence.   Using these agreements and orders, people can show concealed evidence to a judge, but not to the public, just by putting  the evidence into an envelope marked "CONFIDENTIAL--FILED UNDER SEAL PURSUANT TO PROTECTIVE ORDER AND WITHOUT ANY FURTHER SEALING ORDER REQUIRED."^[1]  This simply could not be done without the secrecy agreements and their orders rewriting the Rules.

3. Keeping control over the evidence marked "confidential." The secrecy stipulations in this case, and the January 2016 agreement in particular, were also written to keep control of the "confidential" evidence after the case was over.  The January stipulation provides that it shall always be "binding" unless the party that designated the evidence as confidential, or a judge, says otherwise.^[2]

It apparently was not enough to make the January stipulation in this case endless, however, even after it became a judge's order in February 2016.  The agreement and its order also add a provision typically found in secrecy stipulations-turned-into-secrecy-orders in many other cases, to the effect that once the case ends, "confidential" evidence must either be returned to the party that designated it "confidential," or it must be destroyed.^[3]  In short, the people that possess the evidence marked confidential are required to give it up at the end of that case.  They cannot make the evidence public.  The evidence can only be used for that one case.  When that one case ends, then the way that the thinking goes behind the secrecy here, there is no longer any reason to hold onto the evidence.  The public has no interest in it, according to the lawyers who write these agreements, it seems, and the public seemingly has no dog in this fight either, according to the judges who enable this behavior by validating these secrecy agreements.

This is the end of a three-part series of articles on representative secrecy stipulations that the parties agreed to in one case, the case of People of California v. Wells Fargo.  This is not the end of secrecy stipulations, of course.

Not by a long shot.

Not yet.

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[1] Id., ¶ 18, at p. 8.

 

[2] Id., ¶ 21, at p. 8.

 

[3] Id., ¶ 22, at p. 9.

 

MORE SECRECY, MORE THROWING SHADE ON YOUR FINANCES?

This article continues from the end of the article published here on Tuesday, June 4, 2019.

The stipulation adopted by a judge's order in February 2016 in People v. Wells Fargo lines up behind many other secrecy stipulations and orders used in many other jurisdictions.  It restricts the use of any evidence marked "confidential," to the lawsuit in which the stipulation is filed.  It provides that such evidence may not be used for any other purpose "whatsoever."^[1]   This was pretty obviously intended to be taken literally.  It would mean that the only people who can use evidence marked "confidential" in the People of California v. Wells Fargo case in California are the people involved in that case.  No-one else can ever use it, or even see it. Even the people involved in the case named People of California v. Wells Fargo cannot use such "confidential" evidence anywhere else.

So, perhaps it would be wrong to assume without evidence that the L.A. City Attorney's Office shared Wells Fargo's forbidden special interrogatory answers with the federal agencies that subsequently filed actions over the same charges against Wells Fargo.  There is absolutely no evidence for that matter that the Los Angeles City Attorney's Office ever shared any information with anyone else that was stipulated to secrecy in that case.  This is a much more certain way of keeping a secret than asking a judge to apply the law.

The City Attorney's Office and Wells Fargo also agreed and the judge ordered in that case that if a party considered "competitively sensitive" information to require a "confidential" marking did not mean that anyone else agreed that it was competitively sensitive just because it was marked confidential.^[2]   In other words, the parties agreed in that case that "competitively sensitive" information could be withheld from public view.

The only party that could possibly care if something was "competitively sensitive" is of course a business which faces competition.  In this case, the only party fitting that description is the bank which was accused of abuses in "cross-selling" financial products to the bank's existing customers.  By grafting the concept of keeping any "competitively sensitive" secret to the overall idea of court protection, the parties rewrote the Rules to benefit themselves.

Perhaps more accurately, one of them did and the other agreed to it.  The Rules say nothing about keeping evidence from the public because the evidence might be "competitively sensitive," of course.  The rewritten rule of secrecy agreements like the January 2016 Stipulation would make it possible for a bank, for example, to withhold evidence that might tend to support charges that it is opening accounts in customers' names without the customers' permission or even knowledge.  If that kind of evidence got out into the public, it could be misconstrued.  Whether misconstrued or true, such evidence would understandably be "competitively sensitive." 

What evidence Wells Fargo may have had in the People of California v. Wells Fargo lawsuit is something we may never know.  Wells was granted the "right" in this case by this stipulated secrecy order to conceal whatever it knew.

When the judge signed this stipulation into an order, Wells Fargo's "right" became a ruling and not just an agreement.

To be continued ....  Please Read The Disclaimer.  ©2019 Dennis J. Wall.  All Rights Reserved.

 

[1] Id., ¶ 9, at p. 6.

 

[2] Id., ¶ 11.a, at p. 6.