Safe Health Systems, Inc. v. Greenspoon Marder LLP

Background

The parties submitted a stipulated protective order in Safe Health Systems, Inc.'s action against Chris Chierchio, also known as Chris Lumia; Team Chip LLC; Joseph MacLellan; Greenspoon Marder LLP; and unnamed defendants. The order concerns information and documents exchanged during the pretrial phase of the case. The court stated that the parties had agreed to the confidentiality terms and found good cause for issuing an appropriately tailored order under Rule 26(c) of the Federal Rules of Civil Procedure.

Confidentiality Rules

A party or nonparty producing discovery may designate information, documents, things, testimony, and related notes or summaries as “CONFIDENTIAL” when the material contains sensitive, proprietary, nonpublic, classified, restricted, research, development, commercial, financial, or business information that the producing party regards as confidential. The designation is intended for material that is not generally known, that would normally not be disclosed to third parties, or that otherwise qualifies for protection under Rule 26(c).

Confidential material may be disclosed only to specified recipients, including the court and its personnel, outside counsel and their supervised staff and vendors, certain in-house representatives, qualified nonparty experts and consultants who sign the required agreement, people shown to have prepared or received the material, persons approved in writing by the producing party, and jointly engaged neutrals such as mediators or arbitrators. The parties were directed to meet and confer if a “HIGHLY CONFIDENTIAL — ATTORNEYS’ EYES ONLY” designation is needed.

The order limits use of confidential material to prosecuting or defending the claims in this action. It requires reasonable security measures and provides that, after final resolution from which no further appeal can be taken, the receiving party must return the material or have counsel certify its destruction within 30 days. Counsel's confidentiality obligation continues after the case ends. The restrictions do not apply to information that becomes public without violating the order, is lawfully obtained from an independent third party with disclosure rights, or was lawfully possessed before the order was entered.

Other Procedures

The order permits confidentiality designations for deposition or hearing testimony either on the record or by written notice within 14 days after the transcript is received. Discovery produced by a nonparty is temporarily treated as confidential for 10 business days, during which a party may designate it as confidential. The order also requires secure handling of personally identifying information, including Social Security numbers, financial account numbers, passwords, and information that could be used for identity theft.

Under Federal Rule of Evidence 502, inadvertent disclosure of privileged communications does not waive the privilege in this matter if the parties follow the rule's procedures. A party may seek to modify the order or challenge a confidentiality designation by agreement or, if necessary, by motion to the court.

Sealing and Ruling

The protective order does not itself authorize filing documents under seal. A party must obtain a further court order addressing the specific documents or portions to be sealed and must support the request with an affidavit or affidavits and a legal memorandum addressing the applicable sealing standards, including the standards discussed in Lugosch v. Pyramid Co. of Onondaga. The order also sets notice periods for using another party's confidential information and preserves the requirements of Federal Rule of Civil Procedure 5.2.

The court entered the stipulated protective order after finding good cause. The order governs the handling and use of confidential discovery in the case. Judge P. Castel signed the order.