Securities & Exchange Commission v. Wong

Nature of the Order

The court entered a stipulated protective order under Federal Rule of Civil Procedure 26(c). The Securities and Exchange Commission and Brian Wong, through counsel, agreed that discovery would involve nonpublic and confidential documents or information. The court found good cause to issue a tailored order because public disclosure could harm the producing person or a third party to whom a confidentiality duty was owed.

The order concerns discovery in the Commission’s action for monetary relief. It does not decide the merits of the Commission’s claims against Wong.

Information Covered

A producing person may designate as confidential only information whose disclosure is restricted by law or could harm business, commercial, financial, or personal interests. The listed categories include:

- previously undisclosed financial information; - previously undisclosed information about ownership or control of a nonpublic company; - previously undisclosed business plans, product-development information, or marketing plans; - personal or intimate information about an individual; and - other categories later given confidential status by the court.

Third-party personally identifying information, such as Social Security numbers, financial-account numbers, passwords, tax information, home addresses or telephone numbers, dates of birth, and medical information, is automatically treated as confidential without a separate designation.

The order also permits a producing person to correct an earlier failure to designate material as confidential before trial by notifying prior recipients in writing.

Disclosure and Use Limits

People covered by the order must store confidential discovery material in a reasonably secure manner and may disclose it only as the order permits. Authorized recipients include the parties and their insurers, counsel and litigation staff, litigation-support vendors, mediators or arbitrators, certain people identified on a document, potential witnesses and their counsel, experts and specialized advisers, deposition stenographers, and the court and its personnel. Other disclosures require written consent from the producing party or a court order.

Before receiving confidential material, many outside recipients must receive the protective order and sign a nondisclosure agreement. Recipients may use confidential discovery material only to prosecute or defend this action and related appeals, not for business, commercial, competitive, or other litigation purposes. The order does not restrict a person’s use of that person’s own documents or information, or information obtained independently of discovery.

The order does not limit the Commission’s ability to use or disclose materials consistently with its legal duties, authorities, and applicable laws and regulations, including the Commission’s Form 1662.

Disputes, Court Filings, and Compulsory Process

A party challenging a confidentiality designation must give written notice stating the specific grounds for the objection. A party seeking additional limits on disclosure must likewise provide written grounds. If the parties cannot resolve the issue promptly, counsel must bring the dispute to the court under the court’s individual rules.

The order does not create an automatic right to seal documents. A party filing confidential material under seal must first file a letter-motion explaining the basis for sealing and must publicly file a redacted version while filing the unredacted version under seal. The court retains discretion over confidential treatment and states that it is unlikely to seal material introduced as evidence at trial.

If a recipient receives a lawful subpoena or other compulsory process requiring disclosure, the recipient must notify the producing person before disclosure, and generally at least 10 days before disclosure when the timing permits. The producing person may oppose compliance.

Inadvertent Privilege Disclosure

An inadvertent disclosure of material protected by attorney-client privilege or attorney work-product protection does not waive or forfeit the protection under the order. After a claim of inadvertent disclosure, the receiving party must return or destroy the material within five business days and certify that it did so. The disclosing party must then provide a privilege log, and the receiving party may ask the court to order production. The disclosing party retains the burden of proving that the material is privileged or otherwise protected.

Duration and Enforcement

The protective order continues after the litigation ends. Within 30 days after final disposition, recipients generally must return or destroy confidential discovery material and certify that they have not retained copies or other reproductions. Attorneys specifically retained for the case may keep archival copies of specified case materials, which remain subject to the order. The Commission may retain materials as required by its government record-keeping duties or for permitted uses under Form 1662.

The court retained jurisdiction as needed to enforce the order or impose sanctions for contempt. The order states that a willful violation could result in punishment for contempt of court. Judge Jennifer H. Rearden signed the order on June 6, 2024.