Xu v. Gridsum Holding Inc.

Background

The parties jointly requested a protective order under Federal Rule of Civil Procedure 26(c). They sought protections for nonpublic and competitively sensitive information that might be produced during discovery. The court found good cause for an appropriately tailored order governing the pretrial phase of the action.

Terms of the Order

The order covers discovery material designated “Confidential” or “Highly Confidential.” Confidential material may include previously undisclosed financial information, information about ownership or control of a nonpublic company, business plans, product-development information, marketing plans, personal or intimate information, and other categories later given confidential status by the court. Highly Confidential status is limited to confidential material that is private, sensitive, competitive, or proprietary and whose disclosure is substantially likely to injure the producing party.

The order limits disclosure of Confidential material to specified recipients, including the parties and their counsel, certain service providers, mediators or arbitrators, document authors and recipients, potential witnesses, experts, deposition stenographers, and the court. Highly Confidential material has narrower access rules and may be disclosed to counsel, named individual defendants, certain service providers, mediators or arbitrators, document authors and recipients, witnesses and deponents when necessary for the litigation, experts, deposition stenographers, and the court. Several categories of recipients must first receive the order and sign a nondisclosure agreement.

The parties may designate material by marking it and, where appropriate, providing a redacted version. The order also allows later designations of previously produced material and provides procedures for objecting to confidentiality designations or requesting additional disclosure limits. Protected material may be used only for prosecuting or defending this action and related appeals, not for other purposes or proceedings.

For court filings that contain protected material, the parties must publicly file a redacted version and seek permission to file an unredacted version under seal. The order warns that the court may not seal material introduced into evidence at trial and states that the court has not made a finding that any designated material is actually confidential.

The order provides that an inadvertent production of privileged or otherwise protected material does not waive the applicable privilege or protection, subject to the procedures in the order. Recipients generally must return or destroy protected material within 60 days after final disposition of the action, although counsel specifically retained for the case may keep certain archival materials subject to the order. The order continues after the litigation ends, and the court retains jurisdiction to enforce it and impose contempt sanctions.

Ruling

Judge Gregory H. Woods entered the parties’ stipulated confidentiality agreement and protective order. The opinion does not decide the merits of Xu’s claims or the defendants’ defenses; it addresses discovery confidentiality and related procedures only.