Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_09-cv-05376/USCOURTS-cand-5_09-cv-05376-1/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Other Contract

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ORDER, page 1

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

QUALITY INVESTMENT PROPERTIES

SANTA CLARA, LLC,

Plaintiff,

v.

SERRANO ELECTRIC, INC., et al.,

Defendants.

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Case No.: C 09-5376 JF (PVT)

ORDER GRANTING PLAINTIFF’S MOTION

FOR PROTECTIVE ORDER; AND 

ORDER TO DEFENDANT PETERSON

POWER SYSTEMS, INC. TO SHOW CAUSE

WHY IT SHOULD NOT BE ORDERED TO

REIMBURSE PLAINTIFF 

(Re: Docket No. 24)

On June 21, 2010, Plaintiff filed a motion for protective order governing the handling of

confidential information. Defendant Peterson Power Systems, Inc. (“Peterson”) opposed the motion. 

Having reviewed the papers submitted by the parties, the court finds it appropriate to issue this order

without oral argument. Based on the papers presented,

IT IS HEREBY ORDERED that Defendants' motion is GRANTED. Plaintiff shall promptly

submit to the court a copy of the form of protective order it originally proposed (at docket no. 24-1),

revised solely to reflect the fact that it was not stipulated to by the parties, but instead was entered as

a result of Plaintiff’s motion.

IT IS FURTHER ORDERED that, no later than August 3, 2010, Defendant Peterson shall

file a declaration showing cause, if any, why it should not be required to reimburse Plaintiff for the

attorneys fees Plaintiff incurred in connection with this motion. See, FED.R.CIV.PRO. 26(c)(3) &

37(a)(5)(A).

I. LEGAL STANDARDS

Documents exchanged in discovery are presumptively public. See San Jose Mercury News,

Case 5:09-cv-05376-LHK Document 32 Filed 07/22/10 Page 1 of 6
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ORDER, page 2

Inc. v. United States Dist. Ct., 187 F.3d 1096, 1103 (9 Cir. 1999) (“It is well-established that the th

fruits of pretrial discovery are, in the absence of a court order to the contrary, presumptively public”).

However, blanket protective orders governing the handling of confidential information exchanged in

discovery are routinely approved by courts in civil cases. See, e.g., Gillard v. Boulder Valley School

Dist., 196 F.R.D. 382, 386 (D.Colo. 2000). The very first rule set forth in the Federal Rules of Civil

Procedure requires courts to construe and administer the rules “to secure the just, speedy, and

inexpensive determination of every action and proceeding.” See FED.R.CIV.PRO 1. Blanket

protective orders serve the interests of a “just, speedy, and inexpensive” determination of cases by

alleviating the undue cost and delay that would ensue if courts had to make good cause

determinations on a document-by-document basis for all documents exchanged in discovery that a

party wished to protect. As the Ninth Circuit has implicitly acknowledged, the use of blanket

protective orders conserves resources by eliminating the requirement that a party move for a

protective order every time that party produces documents they contend are confidential. See Foltz v.

State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1131 (9 Cir. 2003) (noting that use of a blanket th

protective order was “understandable for the unfiled documents given the onerous burden document

review entails”). 

While blanket protective orders are usually based on a joint request of the parties, the

agreement of all parties is not required so long as certain conditions are met. See, e.g., Parkway

Gallery Furniture, Inc. v. Kittinger/Pennsylvania House Group, Inc., 121 F.R.D. 264, 268

(M.D.N.C. 1988). Those conditions include the following:

“First, a party must make some threshold showing of good cause to believe

that discovery will involve confidential or protected information. This may be done

on a generalized as opposed to a document-by-document basis. Moreover, even

though a blanket protective order permits all documents to be designated as

confidential, a party must agree to only invoke the designation in good faith. After

receiving documents, the opposing party has the right to contest those documents

which it believes not to be confidential. At this stage, the party seeking the protection

shoulders the burden of proof in justifying retaining the confidentiality designation.

Thus, the burden of proving confidentiality never shifts from the party asserting that

claim-only the burden of raising that issue.” Ibid.

By requiring that a party seeking a protective order meet such conditions, courts avoid

situations like that which was rebuked in Citizens First National Bank of Princeton v. Cincinnati Ins.

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ORDER, page 3

Co., 178 F.3d 943, 946 (7th Cir. 1999) (blanket protective order was worded so broadly that it gave

each party “carte blanche to decide what portions of the record shall be kept secret”).

II. DISCUSSION

A. PLAINTIFF HAS DEMONSTRATED “GOOD CAUSE” FOR ENTRY OF A BLANKET

PROTECTIVE ORDER

Plaintiff has made a threshold showing of good cause to believe that discovery and

disclosures will involve confidential information. See Declaration of Shirley Goza in Support of

Motion for Protective Order, ¶¶ 9-11.

The form of order proposed by Plaintiff limits confidentiality designations to information or

tangible things that qualify for protection under the standards developed under Rule 26(c). 

Moreover, Section 5.1 of the proposed form of protective order ("Exercise of Restraint and Care in

Designating Material for Protection”) requires that:

“Each Party or non-party that designates information or items for protection

under this Order must take care to limit any such designation to specific material that

qualifies under the appropriate standards. A Designating Party must take care to

designate for protection only those parts of material, documents, items, or oral or

written communications that qualify – so that other portions of the material,

documents, items, or communications for which protection is not warranted are not

swept unjustifiably within the ambit of this Order.

“Mass, indiscriminate, or routinized designations are prohibited. Designations

that are shown to be clearly unjustified, or that have been made for an improper

purpose (e.g., to unnecessarily encumber or retard the case development process, or to

impose unnecessary expenses and burdens on other parties), expose the Designating

Party to sanctions. 

“If it comes to a Party’s or a non-party’s attention that information or items

that it designated for protection do not qualify for protection at all, or do not qualify

for the level of protection initially asserted, that Party or non-party must promptly

notify all other parties that it is withdrawing the mistaken designation.”

Thus, the protective order proposed by Plaintiff ensures that the parties are not improperly

given “carte blanche” to designate information which is not entitled to protection under Rule 26(c). 

B. PLAINTIFF HAS NOT WAIVED ITS CONFIDENTIALITY OBJECTION 

Peterson cites no case where a court has found a party waived its claim of confidentiality by

withholding documents from its initial disclosures when it also asserted a confidentiality objection

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28 In fact, in Nat’l Academy of Recording Arts &Sciences, Inc. v. On Point Events, LP, 256 1

FRD 678 (C.D. Cal. 2009) the court allowed redaction of certain confidential information despite the

untimely assertion of confidentiality.

ORDER, page 4

and offered to enter into a routine blanket protective order. The court is not inclined to make such a 1

finding here.

As Plaintiff points out, the obligation to make documents available for inspection and

copying pursuant to Rule 26(a)(1)(A)(iii) does not apply to documents that are “protected from

disclosure.” The rules expressly provide that the failure to serve responses to Rule 34 document

requests without first moving for a protective order would not be excused on grounds of a

confidentiality objection. See FED.R.CIV.PRO. 37(d)(2) (failure to respond to discovery requests not

excused on the ground the discovery is objectionable unless objecting party has a pending motion for

a protective order). There is no similar provision regarding a party withholding documents from its

initial disclosures based on an objection. Thus, the court finds that a confidentiality objection is an

acceptable excuse for a party withholding documents from its initial disclosures when that party has,

at a minimum, proposed entering into a stipulated protective order at or about the time it asserts its

confidentiality objection.

Here, Plaintiff stated in its initial disclosures that it agreed to produce documents supporting

its damage claims subject to an appropriate protective order to protect the confidential and

proprietary information contained in its documents. This was an adequate assertion of a

confidentiality objection. Plaintiff noted it was in the process of meeting and conferring with

Defendants regarding a stipulated protective order. Under these circumstances Plaintiff has not

waived its confidentiality objection, and it is excused from producing the confidential supporting

documentation until an appropriate blanket protective order is entered.

C. PLAINTIFF’S PROPOSED FORM OF PROTECTIVE ORDER ACCURATELY TRACKS THE

VERSION OF THIS COURT’S MODEL FORM OF PROTECTIVE ORDER THAT WAS

AVAILABLE ON THE COURT’S WEBSITE PRIOR TO JUNE 9, 2010.

Plaintiff’s proposed form of protective order accurately tracks the language of the model

form of stipulated protective order that was available on the court’s website prior to June 9, 2010. 

While the court has changed some of the language in its model form of order, there is nothing

inherently wrong with the prior language. The presence of an “Attorneys Eyes Only” level of

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Sections 7.2 and 7.3 both begin “Unless other wise ordered by the court or permitted in 2

writing by the Designating Party...” (emphasis added).

The court is aware that Plaintiff offered in its reply to accept the form of order proposed 3

by Peterson. However, this court prefers the form of order based on the court’s former model form of

order for this case. In cases where parties show an inclination to throw up procedural roadblocks, as

Peterson has, a provision that would allow a party to require a designating party to move for protection

for all of its designated documents within a short period of time is too vulnerable to abuse. 

ORDER, page 5

protection does not allow any party to use that level of designation unless to do so warranted under

Rule 26(c). As to the provision which places the burden of filing a motion on the party challenging a

confidentiality designation, this court actually prefers that allocation from the prior model form of

order. (The burden of justifying the designation always remains on the designating party.) As to

mediators, the parties can either agree to allow disclosure of designated documents to the mediator2

or the party seeking to disclose designated information may seek an order of the court. The court

expects that no party will unreasonably refuse to allow disclosure of designated material to a

mediator assigned to this case.

For all of the reasons stated above, entry of Plaintiff’s original proposed blanket protective

order is warranted. That form of protective order tracks the language of this court’s prior model 3

form of order, and was stipulated to by both Plaintiff and Defendant Serrano Electric, Inc.

(“Serrano”). During the meet and confer process, Peterson declined to stipulate to a blanket

protective order not based on any objection to the proposed terms of the order, but on its

unreasonable demand to review Plaintiff’s confidential documents before agreeing to entry of a

routine protective order. The alternate language Peterson belatedly asks be substituted into the form

of protective order is neither necessary nor superior to the model language that was proposed by

Plaintiff and that has already been agreed to by Defendant Serrano. Under all the circumstances, the

court finds it appropriate to issue a blanket protective order in the form proposed by Plaintiff and

agreed to by Defendant Serrano. Plaintiff shall promptly submit to the court a copy of the proposed

form of order, revised to reflect the fact that it was not stipulated to by all parties, but instead was

entered as a result of Plaintiff’s motion.

III. CONCLUSION

Plaintiff has shown that entry of a blanket protective order–something that is routinely done

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ORDER, page 6

in any kind of commercial litigation–is warranted. There appears to have been no legitimate reason

for Defendant Peterson to decline to stipulate to such an order. Thus, entry of the protective order is

warranted, as is an order requiring Peterson to show cause why it should not be ordered to reimburse

Plaintiff for the attorneys fees incurred to bring a motion that should never have been necessary.

Dated: 7/21/10

 

PATRICIA V. TRUMBULL

United States Magistrate Judge

Case 5:09-cv-05376-LHK Document 32 Filed 07/22/10 Page 6 of 6