Calltrol Corporation v. LoxySoft AB

Background

Calltrol Corporation is the plaintiff, and LoxySoft AB and LoxySoft, Inc. are the defendants. The parties jointly requested a protective order under Federal Rule of Civil Procedure 26(c) for nonpublic and competitively sensitive information that could be disclosed during discovery. The order states that the court found good cause for an appropriately limited confidentiality order governing the pretrial phase of the action.

Confidential Information

A producing party may designate only material that it reasonably and in good faith believes includes specified confidential information, such as previously undisclosed financial information; information about ownership or control of a nonpublic company; business, product-development, or marketing plans; personal or intimate information; or trade secrets, including confidential computer source code and related materials. The court may also give confidential status to another category of information later.

The order provides procedures for marking confidential material, redacting copies for public use, and designating deposition testimony and exhibits. A producing party may correct an earlier failure to designate information before trial by notifying prior recipients in writing.

Disclosure and Use Limits

Confidential discovery material may be disclosed only to the categories of people listed in the order. These include the parties and certain insurers, litigation counsel and their assigned staff, litigation vendors, mediators or arbitrators, specified persons connected to a document, potential witnesses, experts and advisers, deposition transcription staff, and the court. Mediators, arbitrators, witnesses, experts, and advisers generally must first receive the order and sign the required nondisclosure agreement.

Recipients may use confidential material only to prosecute or defend this action and related appeals. They may not use it for business, commercial, competitive, or other litigation purposes. The order also requires reasonable precautions against unauthorized or accidental disclosure.

Court Filings and Challenges

A party objecting to a confidentiality designation may serve written notice stating the specific grounds for the objection. A party requesting additional limits, such as an attorneys’-eyes-only designation in extraordinary circumstances, must follow a similar procedure. If the parties cannot resolve the dispute, they must bring it to the court under the court’s individual practices.

The order requires a party filing confidential material with the court to publicly file a redacted version and file the unredacted version under seal. It also requires a letter brief and supporting declaration giving particularized reasons for continued sealing. The court retains discretion over whether to keep confidential material under seal and warns that it is unlikely to seal material introduced as evidence at trial.

The order does not waive objections to discovery, privileges, or protections, and it does not decide whether documents, testimony, or other evidence will be admissible at trial. It also permits production in response to lawful compulsory process, subject to notice to the producing party when reasonably possible.

Disposition

The court entered the stipulated confidentiality agreement and protective order. Within 60 days after final disposition of the action, including appeals, recipients generally must return or destroy confidential material and certify that they retained no copies or other reproductions. Litigation counsel may keep specified archival materials, but those materials remain subject to the order. The order survives termination of the litigation, and the court retains jurisdiction as needed to enforce it or impose contempt sanctions. The accompanying nondisclosure agreement requires covered recipients to acknowledge the order, limit disclosure to the litigation, return discovery at the end of the litigation, and accept the court’s jurisdiction for disputes concerning the order.