Securities and Exchange Commission v. Simeo

Background

The Securities and Exchange Commission brought this action against Tom Simeo. The parties, through counsel, requested a protective order under Federal Rule of Civil Procedure 26(c) to protect nonpublic and competitively sensitive information that might be disclosed during discovery. The parties stipulated to the proposed terms, and the court found good cause for an appropriately tailored order governing the pretrial phase.

Order

The court ordered anyone covered by the order—including the parties, their representatives, agents, experts, consultants, third parties providing discovery, and others with actual or constructive notice—to comply with its requirements, subject to possible contempt sanctions.

The order permits a producing party to designate only portions of discovery materials as confidential when the party reasonably and in good faith believes they contain specified categories of information, including previously undisclosed financial information; information about ownership or control of a nonpublic company; business, product-development, or marketing plans; personal or intimate information; or another category later given confidential status by the court.

Confidential materials may be disclosed only to listed recipients, such as the parties and their insurers, counsel and their support staff, vendors assisting with the case, mediators or arbitrators, certain people identified on a document, potential witnesses, experts, deposition stenographers, and the court. Witnesses, experts, mediators, and arbitrators who receive the materials must first sign a nondisclosure agreement. Counsel must retain those agreements and produce them as required by the order.

Sealing and challenges

A party filing materials under seal must file a public redacted version and provide a letter brief and supporting declaration explaining, on a particularized basis, why continued sealing is justified. The order states that the court may unseal materials if the required specific findings are not made and that confidential treatment is unlikely for discovery materials introduced as trial evidence. The court retains discretion over confidential treatment of materials submitted in connection with motions or other proceedings that may result in a court order or decision.

A party may object to a confidentiality designation or request additional disclosure limits, such as attorneys'-eyes-only treatment, before trial. If the parties cannot promptly resolve the issue, counsel must present the dispute to the court under its individual practices.

Use, return, and enforcement

Recipients may use confidential discovery materials only to prosecute or defend this action and related appeals, not for business, commercial, competitive, or unrelated litigation purposes. The order allows disclosure when required by a lawful subpoena, other compulsory process, applicable law, or a government agency with jurisdiction, subject to notice requirements.

Within 60 days after the final disposition of the action, including appeals, recipients generally must return or destroy the confidential materials and certify that they retained no copies or reproductions. Specifically retained attorneys may keep archival copies of specified litigation materials, but those copies remain subject to the order. The order continues after the litigation ends, and the court retains jurisdiction to enforce its obligations and impose contempt sanctions.

Disposition

Judge Paul G. Gardephe issued the stipulated confidentiality agreement and protective order on March 19, 2020. This order addressed discovery confidentiality and did not decide the underlying claims in the action.