Palmer/Kane LLC v. Benchmark Education Company LLC

Background

Palmer/Kane LLC and Benchmark Education Company LLC, along with the other named defendants, jointly requested a protective order under Federal Rule of Civil Procedure 26(c). Through counsel, the parties agreed to terms protecting nonpublic and competitively sensitive information that might be disclosed during discovery. The court found good cause for an appropriately tailored order governing the pretrial phase of the action.

Confidentiality Designations

The order permits a producing party to designate as confidential only material that it reasonably and in good faith believes includes specified protected information, such as previously undisclosed financial information; previously undisclosed information about ownership or control of a nonpublic company; business, product-development, or marketing plans; personal or intimate information; or another category the court later protects.

The producing party or its counsel must clearly mark confidential portions of discovery materials and provide a redacted copy for future public use. Deposition testimony and exhibits may be designated during the deposition or within 30 days afterward. During that 30-day period, the entire deposition transcript must be treated as confidential. A producing party may also correct an earlier failure to designate material by notifying prior recipients in writing before trial.

Permitted Disclosures and Use

Confidential discovery material may be disclosed only to the categories listed in the order. These include the parties and their insurers; counsel and assigned support staff; outside vendors; mediators or arbitrators; persons identified on a document as its author, addressee, or recipient; potential witnesses; experts and other specialized advisers; deposition stenographers; and the court and its personnel.

Before receiving confidential material, mediators or arbitrators, potential witnesses, experts, and specialized advisers must receive the order and sign the required nondisclosure agreement. Confidential material may be used 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 party’s rights concerning its own documents or information.

Sealing and Confidentiality Disputes

A party filing material under seal must simultaneously file a letter brief and supporting declaration giving a particularized justification for continued sealing. The order states that the court retains discretion over whether to give confidential treatment to material submitted in connection with a motion or other proceeding. It also warns that material introduced at trial is unlikely to remain sealed.

When confidential material is filed with the court, the parties must publicly file a redacted version and file the unredacted version under seal. A party may object to a confidentiality designation or request additional disclosure limits, such as attorneys’ eyes only treatment, by written notice stating the grounds. If the parties cannot promptly resolve the dispute, counsel must bring it to the court under the court’s individual practices.

Inadvertent Privilege Disclosures and Return of Materials

An inadvertent disclosure of material protected by attorney-client privilege or work-product protection does not waive or forfeit the protection under the order. After receiving a claim of inadvertent disclosure, the receiving party must return or destroy the material within five business days and provide a certification. The producing party must then provide a privilege log within five business days after notification that the material was returned or destroyed. The receiving party may ask the court to compel production, while the producing party retains the burden of establishing privilege or protection.

Within 60 days after the final disposition of the action, including appeals, recipients must return confidential discovery material or destroy it if the producing party permits destruction. They must certify that they retained no copies or other reproductions. Counsel specifically retained for the action may keep an archival copy of certain litigation materials, but those copies remain subject to the order.

Ruling and Effect

Judge Philip M. Halpern entered the stipulated confidentiality and protective order. It binds persons who receive or otherwise have notice of the order, continues after the litigation ends, and preserves the court’s jurisdiction to enforce the order or impose contempt sanctions. The order did not decide the admissibility of evidence, waive discovery objections or privileges, or resolve the underlying claims.