KeyBanc Capital Markets Inc. v. Novel Energy Solutions, LLC

Background

The parties stipulated to a confidentiality and protective order governing discovery in this action. A protective order is a court order that controls how information exchanged during litigation may be used and disclosed. The court found good cause for issuing the agreed order.

Confidentiality Rules

Discovery materials may be used only to prosecute or defend the pending lawsuit. Parties and third parties may designate information as “Confidential” if it includes trade secrets, competitively sensitive business information, private personal information, information received from third parties in confidence, or other information the designating party reasonably believes deserves protection. Materials may be designated “Highly Confidential” when disclosure is highly likely to cause significant harm to a person, business, or competitive position.

The order limits disclosure of confidential and highly confidential materials to specified recipients, including the parties or their counsel in the case, certain litigation-support personnel, authors and recipients of documents, designated witnesses, experts, deposition stenographers, and the court. Some recipients must first receive a copy of the order and sign a written nondisclosure agreement. Disclosure to other people requires a court order or the producing party’s written approval or statement on the record, along with a signed undertaking.

Sealing and Challenges

Confidential materials filed with the court, and filings that reveal those materials, must be handled under the order’s procedures. However, the order states that no document may be filed under seal without a separate court order addressing the specific material. A sealing request must include an affidavit and legal memorandum addressing the standards for sealing, including the Second Circuit’s decision in Lugosch v. Pyramid Co. of Onondaga. The parties must make efforts to minimize sealing, and the order warns that the court is unlikely to keep material confidential if it is introduced at trial.

A party or third party may object to a confidentiality designation or request stricter disclosure limits before trial. If the parties cannot promptly agree, their attorneys must arrange a telephone conference with the court for a ruling.

Privilege and Work Product

The order addresses accidentally disclosed information protected by attorney-client privilege or the work-product doctrine. After receiving notice of an inadvertent disclosure, the receiving party must stop reviewing the material, return or destroy copies within five business days, and provide a certification. The disclosing party must then provide a privilege log. The receiving party may ask the court to order production, but the disclosing party retains the burden of showing that the material is privileged or protected.

The order states that producing privileged or work-product-protected material, whether accidentally or otherwise, does not waive the protection in this case or another federal or state proceeding. It is intended to provide the maximum protection allowed by Federal Rule of Evidence 502(d).

Disposition and Effect

Judge P. Kevin Castel entered the stipulated protective order on July 17, 2025. The order survives the termination of the litigation. Within 30 days after final disposition, protected materials and copies generally must be returned to the producing person or destroyed, although counsel may retain file copies that remain protected. The court retains jurisdiction over people subject to the order as needed to enforce its terms or impose contempt sanctions.