Money Tree Capital Funding, LLC v. Money Tree Capital Markets LLC

Background

All parties, through counsel, requested a protective order under Federal Rule of Civil Procedure 26(c). They sought protection for nonpublic and competitively sensitive information that might be disclosed during discovery. The court stated that good cause existed for a tailored confidentiality order governing the pretrial phase of the action.

Confidentiality Rules

The order defines “Discovery Material” as information produced or disclosed during discovery. A producing party may designate only portions that it reasonably and in good faith believes include:

- Previously undisclosed financial information, such as profitability reports or estimates, fees, royalty rates, payment guarantees, sales reports, and margins; - Previously undisclosed information about ownership or control of a nonpublic company; - Previously undisclosed business plans, product-development information, or marketing plans; - Personal or intimate information about an individual; or - Another category that the court later gives confidential status.

The order establishes procedures for marking confidential material, including redacting a public version. Deposition testimony may be designated during the deposition or within 30 days afterward. A producing party may also correct an earlier failure to designate material by notifying the other parties and providing replacement versions within two business days.

Permitted Disclosure and Use

Confidential material may be disclosed only to the categories of people listed in the order. These include the parties and their insurers, counsel and litigation-support personnel, certain vendors, mediators or arbitrators, people identified as recipients of a document, potential witnesses, experts or specialized advisers, deposition transcription personnel, and the court. Certain recipients must first receive the order and sign a nondisclosure agreement.

Recipients may use confidential material only to prosecute or defend this action and related appeals. The order does not restrict a party’s rights concerning its own documents or information. It also permits disclosure when required by a lawful subpoena, other compulsory process, law, or a government agency, subject to notice requirements.

Court Filings and Challenges

The order does not itself determine that designated material is confidential. The court retains discretion to decide whether confidential treatment is appropriate and warned that it may be unlikely to seal material introduced at trial.

A party intending to file designated material must notify the other parties and meet and confer about the scope of any sealing request. If the parties agree, they must file a joint letter motion and a publicly accessible redacted copy. If they do not agree, the filing party must request a court conference and publicly file a redacted copy; the opposing party may respond under the court’s procedures. Parties may also object to confidentiality designations or request additional disclosure limits before trial.

Ruling and Effect

Judge Ramos ordered the parties and other people subject to the order to comply, subject to contempt sanctions. Within 60 days after final disposition, including appeals, recipients generally must return or destroy confidential material and certify that they retained no copies or summaries. Litigation counsel may keep certain archival case files, but those files remain subject to the order. The order survives termination of the litigation, and the court retained jurisdiction to enforce it or impose contempt sanctions. The order resolves confidentiality and discovery-management matters; it does not decide the underlying claims.