Nonparty Asks Court to Modify Agreed Protective Order to Allow Disclosure
It's rare these days to make it through a lawsuit between businesses without entering a protective order for some documents. At some point, someone always has some financial records or trade secrets they need protected. What happens if a nonparty wants the court to modify an agreed protective order after it has already been entered?
This case may let corporate counsel sleep a little easier, because the protective order will stand in all but the rarest of circumstances. The Second Circuit Court of Appeals wrote:
It is “presumptively unfair for courts to modify protective orders which assure confidentiality and upon which the parties have reasonably relied.” Once a court enters a protective order and the parties rely on that order, it cannot be modified “absent a showing of improvidence in the grant” of the order or “some extraordinary circumstance or compelling need.”
That's a pretty high watermark for a nonparty to reach.
Drizin sued Sprint in a state court class action. AT&T filed a separate federal suit against Sprint, apparently arising out of the same or similar fact pattern. AT&T and Sprint entered an Agreed Protective Order in the federal case, under which the parties could designate certain documents and testimony as confidential in order to avoid disclosure to third-parties. Drizin moved to intervene, intending to challenge the protective order and obtain copies of Sprint's documents from AT&T.
In its opinion, the Second Circuit Court of Appeals noted that Drizin’s motion for permissive intervention was the right procedural step, but appealing the trial court’s denial of that motion was a hugely uphill battle. The Court stated that its review was highly deferential to the trial court, and that a denial of permissive intervention has virtually never been reversed.