Phillip M. Aurentz (left) and Aimee P. Fagan (right), partners with Sidley Austin (Courtesy photos)

Little creates as much havoc in civil litigation as an ill-conceived or misunderstood protective order. Yet many parties rush through the process of negotiating and preparing a protective order, often delegating the task to young associates with little experience in identifying and surviving the pitfalls associated with them. There is no good substitute for experience. But careful consideration of the dozen questions posed below will help avoid some of the more common rookie mistakes.

(1) How many and what confidentiality tiers are appropriate?

Protective orders often have multiple levels of protection. For example, in a three-tier order, a “Confidential” label is typically used to keep information available to all parties and their counsel but prevent disclosure to the public. A “Highly Confidential” designation may limit access to specific individuals and counsel for each party, and may be used to limit the parties’ technical employees’ access to core case material. A third tier, “Attorneys Eyes Only” may be used to limit disclosure to outside counsel only, or a mix of outside and in-house counsel who may be restricted from or uninvolved in business and development activities related to the underlying technologies or confidential information. A two-tier system (often “confidential” and “attorneys eyes only”) may be a better solution in simpler cases, as they are generally easier to manage and less prone to the human error that may occur while designating and managing designated information.

(2) Who can see, and who will need to see, information designated confidential under the protective order?

Time spent discussing who should and should not be permitted to access documents and confidential information is important. While a client may want restrictive designations to protect its own information, that cuts both ways. When it comes time to prepare the client’s employees for deposition or trial, the client’s employees may be walled off from key communications, documents, expert reports, or deposition testimony offered by the other side—information that might be incredibly useful and valuable to the employee in understanding the importance of his testimony or word choice. Similarly, if a client’s division head is going to be involved in future settlement discussions, consider whether that individual will be permitted sufficient access to relevant information to enable that individual to meaningfully participate in those discussions.

(3) Will the confidentiality tiers apply to pleadings, descriptions, motions, and hearings at which confidential information may be disclosed?

If the parties are permitted to designate motions or hearings “Attorneys’ Eyes Only,” the clients may find themselves locked out of key substantive proceedings, unable to adequately assess liability, and lacking the information necessary to engage in meaningful settlement discussions. Balancing client confidentiality with client access and case management needs should be top of mind when drafting the protective order.

(4) How will disputes over designations be efficiently and economically resolved?

The courts are generally tired of discovery disputes and often too slow to provide the relief the parties need. It is safe to assume that disputes will arise over designations. It is important to draft dispute resolution provisions that clearly articulate who has the burden to seek relief, what happens if relief is not sought, and how the document can be treated while the dispute is pending. Courts may not be able to quickly resolve PO disputes, and the parties will need a mechanism to allow the case to proceed efficiently during the disagreement.

(5) What impact will confidentiality designations have on the clients’ experts?

Protective orders often contemplate experts receiving and reviewing confidential information exchanged by the parties at every level of confidentiality. Consider whether that includes “Attorneys’ Eyes Only” designated material, and whether the allowance extends to the experts’ consultants and staff who are often helping the expert. Consider whether each consultant and staff must be disclosed to opposing counsel with the opportunity to object before receiving information, and if so, the potential time delays and gamesmanship that can occur as a result. Also consider when experts’ signed protective order agreements must be executed and exchanged, and whether the opposing party will have an opportunity to object to a specific expert witness receiving a category of particularly sensitive information. What if the expert is a consultant for one of the party’s top competitors, for example? Consider what process will be used to work through these issues efficiently and with minimal gamesmanship.

(6) What requirements will apply to the staff and personnel behind the scenes that are needed to help try the case?

The protective order should also address necessary personnel such as court reporters, document vendors, translators, and videographers. Typically, those individuals would be permitted to handle and view all levels of confidential information, but that should be spelled out. The parties should also come to an agreement about whether those professionals can rely on their own ethical confidentiality standards or engagement agreements, or whether they need to sign a copy of the protective order before gaining access.

(7) Will jury consultants and mock juries be given access to designated material, and what is required of them?

In many cases, parties may hire a jury consultant for advice in preparing for trial. The parties may also engage in a jury study or mock trial exercises to refine their trial presentation. These sorts of exercises may involve a large number of people: jury consultants and their staff, administrative personnel, site personnel, lay individuals recruited to serve as mock jurors, in addition to counsel and their witnesses. Consider whether the parties will be permitted to test a particular piece of evidence in such proceedings, even if it is designated “Highly Confidential” or “Attorneys’ Eyes Only.” If it is important to be able to present key evidence to a mock jury, make sure the protective order allows it.

(8) What procedures will apply for inadvertent disclosures or violations of the protective order?

Assume mistakes will happen so long as humans handle discovery in litigation, even when the best procedures are used to prevent inadvertent disclosures or accidental violations of the protective order. Spelling out clearly what happens next is important. Consider what will happen when a privileged document is inadvertently produced. Incorporate strong clawback procedures to allow efficient correction with minimal gamesmanship, minimizing the risk of unintentional waiver and related discovery disputes. Identify the time period for identifying the inadvertently produced information, a protocol that the recipient must use (destroy or return), and a procedure for handling any disputes as to whether the clawed back information is indeed privileged. Consider also including a provision preventing the receiving party’s counsel from making any use or reference to the contents of the document to its clients or the court outside of a sealed pleading.

(9) What will be required for privilege logs?

While the Federal Rules require privilege logs in most instances, the parties may agree to limit the burden or scope of privilege logs. For example, the parties often choose to agree that communications after the complaint is filed need not be logged. But consider whether that extends to communications with trial counsel, prosecution counsel, in-house counsel, or other outside counsel handling related (or unrelated) transactions or events.

(10) Will the order include a patent prosecution bar or other restriction and what is the appropriate scope?

In competitor litigation, patent prosecution bars are often used to protect a disclosing party’s information from misuse by a receiving party who might then use the information to invent new technologies or draft patent claims covering technology inspired by or disclosed in the opposing party’s confidential documents. Patent prosecution bars merit their own article, but at a minimum counsel should consider the full impact of what a bar on patent prosecution will mean to (1) the client (as well as the opposing party), (2) counsel who are handling the litigation, and (3) counsel handling ancillary proceedings such as an inter partes review (IPR) before the U.S. Patent and Trademark Appeal Board. Also consider whether a prosecution bar would extend to the parties’ in-house counsel, and if so, whether such a bar would interfere with in-house counsel’s job responsibilities within the organization. Finally, counsel should consider the impact of disclosure of confidential documents to the parties’ witnesses, analyzing the potential impact of subjecting those witnesses to a long-term prosecution bar preventing patent prosecution or inventive work in the subject matter of the patent.

(11) How will communications with experts be protected?

Federal Rule of Civil Procedure 26(b)(4)(C) provides protection for communications between trial counsel and their experts who will be submitting expert reports. A good protective order addresses some of the ambiguities not spelled out in the rule. Consider whether communications with experts involved in patent claim construction or other proceedings is also protected, as opposed to simply those activities defined as “trial preparation.”

(12) How will source code be handled?

In cases involving software, source code review is often necessary. Preparing a thoughtful source code provision in the protective order is necessary. While it merits much more discussion than this article provides, it is important to talk with clients early about their source code, how the client produces code, and what limitations are appropriate for source code production and disclosure.