GMA Accessories, Inc. v. Danbar Cool Things, Inc.

Background

GMA Accessories, Inc. and Danbar Cool Things, Inc. submitted a proposed Stipulation and Order of Confidentiality for the Court’s approval. The order governs discovery materials exchanged by the parties and by other parties or nonparties in the action.

Confidentiality Designations

A producing party may designate specifically identified discovery materials as “CONFIDENTIAL” or “AEO HIGHLY CONFIDENTIAL” after making a good-faith determination that the materials contain proprietary or nonpublic information, such as trade secrets, unpublished financial data, business or product plans, customer information, technical research, design documents, or other information whose disclosure could cause competitive harm. The designation must generally be placed on the document or the relevant portion of it. Deposition testimony and exhibits may be designated on the record or within five days after receipt of the transcript.

A failure to designate material initially does not waive the right to designate it later. After receiving a supplemental designation, the receiving party must use its best efforts to treat the material as confidential.

Limits on Disclosure

Confidential information may be disclosed to the parties, counsel and certain counsel personnel and service providers, qualified experts and consultants, witnesses or deponents and their counsel, people identified as authors or recipients of a document, deposition stenographers, the Court and appellate courts, and others with the producing party’s written consent. Experts, consultants, witnesses, and deponents receiving covered information must generally sign the nondisclosure agreement attached as Exhibit A. The information may be used only for purposes allowed by the order.

Information marked “AEO HIGHLY CONFIDENTIAL” receives greater protection. It may be disclosed to outside counsel of record and the other categories identified in the order, but not directly to the client except that counsel may discuss the information with the client without providing the documents. Recipients may not use the information for competitive purposes, including creating, designing, or developing competing products.

Sealing and Disputes

The order requires AEO highly confidential information and filings that reveal it to be filed under seal in accordance with court procedures. It states that sealing or redaction must be narrowly tailored and consistent with the presumption that judicial documents are publicly accessible. A confidentiality agreement or the parties’ consent alone does not establish a sufficient basis for sealing.

A party marking material AEO highly confidential must meet and confer with an opposing party or third party within one week to narrow the request. A party objecting to a confidentiality designation may provide written notice identifying the grounds for the objection, after which the parties must confer in good faith. The designation remains effective until the parties resolve the dispute or the Court rules on it.

Court’s Action and Effect

Judge Vernon S. Broderick approved the parties’ stipulation and ordered that it govern the handling of discovery materials. The order does not determine the treatment of confidential material at trial or an evidentiary hearing; that treatment will be addressed by a later order. It also preserves objections to discovery, privileges and other protections, and evidentiary objections.

Unless otherwise agreed or ordered, within 30 days after final disposition of the action, including appeals, confidential information must be returned or destroyed, subject to the order’s exceptions and certification procedures. The order survives the termination of the proceedings. The Court retains jurisdiction to enforce the order and impose contempt sanctions.