Oyster HR, Inc. v. eTeam, Inc.

Background

Oyster HR, Inc. and eTeam, Inc. are the parties in this litigation. They stipulated to a proposed confidentiality order under Federal Rule of Civil Procedure 26(c). The order states that the parties expected discovery to include confidential and proprietary information, including sensitive financial, commercial, business, personal, and trade-secret information. The court reviewed the proposed order and stated that good cause had been shown for entering it.

Confidentiality Designations

The order allows either party to designate information, documents, things, written discovery responses, deposition testimony, or portions of those materials as “Confidential” when the producing party believes in good faith that the material is entitled to protection under Rule 26(c)(1)(G). Documents generally must be clearly marked “CONFIDENTIAL.” Deposition testimony may be designated on the record or by written notice within 30 days after receipt of the transcript; unless the parties agree otherwise, deposition testimony is treated as confidential until 30 days after the deposing party receives the transcript.

A party may withdraw a confidentiality designation in writing. A receiving party may object at any time during the case. The parties must first confer in good faith, and the producing party bears the burden of proving confidentiality by a preponderance of the evidence. If the dispute is not resolved within 10 calendar days after the objection, the objecting party may move for an order requiring redesignation, generally within 30 calendar days after receiving the objection. The material remains subject to the confidentiality designation until the court rules on the dispute.

Use and Disclosure

Confidential information may be used only for this litigation. Unless the producing party gives written permission or the court enters another order, disclosure is limited to specified recipients, including the parties and involved employees, outside litigation counsel and their supporting personnel, stenographers and videographers recording testimony, experts and consultants retained for the litigation, and the court and its personnel.

Before receiving confidential information, an expert or consultant must sign the undertaking in the order’s appendix. The order also permits disclosure to certain authors or recipients of the information, former affiliates who authored it and sign the undertaking, and people who legally received it before the case began. A party seeking to disclose confidential information to an unauthorized person must first make a reasonable attempt to obtain permission from the producing party or move the court for permission.

Other Protections

The order provides that an inadvertent production of privileged or otherwise protected material does not waive the applicable protection. When the producing party gives notice of the inadvertent production, the receiving parties must follow Federal Rule of Civil Procedure 26(b)(5)(B). The order also protects confidential information produced by nonparties and does not prevent a nonparty from seeking additional protection.

Confidential information may be filed under seal only after a further court order addressing the specific material. An application to seal must include affidavits and a legal memorandum addressing the applicable sealing standards, including the standards discussed in Lugosch v. Pyramid Co. of Onondaga. The order separately addresses advance notice and deadlines when one party seeks to use another party’s confidential information, and it preserves the operation of Federal Rule of Civil Procedure 5.2.

End of the Litigation and Disposition

The confidentiality order remains in force after the litigation ends unless the parties agree otherwise or the court orders otherwise. Within 30 days after the case concludes, each party must return the producing party’s confidential documents and copies and destroy materials derived from or revealing that information, unless the producing party agrees to destruction of the documents instead. The returning or destroying party must certify compliance in writing. The parties and attorneys specifically retained for the action may keep archival copies of specified litigation materials, but those copies remain subject to the order.

The court ordered that the confidentiality order may be modified on the court’s initiative or on motion by a party or another person with standing. It binds counsel of record and their firms, the parties, and other people made subject to it by its terms. Judge P. Kevin Castel entered the order.