Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_01-cv-21029/USCOURTS-cand-5_01-cv-21029-9/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:78m(a) Securities Exchange Act

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28 1 The holding of this court is limited to the facts and the particular circumstances

underlying the present motion.

ORDER, page 1

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

In re NEXTCARD, INC. SECURITIES

LITIGATION

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This Document Relates To:

ALL ACTIONS.

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Case No.: C 01-21029 JF (PVT)

ORDER DENYING MOTION TO MODIFY

PROTECTIVE ORDER WITHOUT

PREJUDICE TO A MOTION TO COMPEL

PRODUCTION OF DOCUMENTS

On October 31, 2006, Lead Plaintiffs filed a motion to modify the August 11, 2006

Stipulated Protective Order As Modified by the Court (the “Protective Order”).1 Having reviewed

the papers submitted by the Lead Plaintiffs, the court finds it appropriate to issue this order without

further briefing or oral argument. Based on the arguments presented,

IT IS HEREBY ORDERED that Lead Plaintiffs’ motion is DENIED. This court is not

willing to modify the Protective Order in a way that would prevent parties from challenging

confidentiality designations. Doing so would be inconsistent with the purposes of this court’s Civil

Local Rule 79-5, and would potentially lead to unnecessary burdens on the court and the parties in

the event any party seeks to file with the court any of the designated documents which are not

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ORDER, page 2

actually entitled to protection. Civil Local Rule 79-5(d) provides that:

“Filing a Document Designated Confidential by Another Party. If a party wishes

to file a document that has been designated confidential by another party pursuant to a

protective order, or if a party wishes to refer in a memorandum or other filing to

information so designated by another party, the submitting party must file and serve

an Administrative Motion for a sealing order and lodge the document, memorandum

or other filing in accordance with this rule. If only a portion of the document,

memorandum or other filing is sealable, the submitting party must also lodge with the

Court a redacted version of the document, memorandum or other filing to be placed in

the public record if the Court approves the requested sealing order. Within five days

thereafter, the designating party must file with the Court and serve a declaration

establishing that the designated information is sealable, and must lodge and serve a

narrowly tailored proposed sealing order, or must withdraw the designation of

confidentiality. If the designating party does not file its responsive declaration as

required by this subsection, the document or proposed filing will be made part of the

public record.”

The court may only order a document be filed under seal if the party claiming confidentiality

shows there is “good cause” for sealing the specific document. See FED.R.CIV.PRO. 26(c)(8); see

also, e.g., Kamakana v. City and County of Honolulu, 447 F.3d 1172, 1179-80 (9th Cir. 2006)

(“when a district court grants a protective order to seal documents during discovery, ‘it already has

determined that ‘good cause’ exists to protect this information from being disclosed to the public by

balancing the needs for discovery against the need for confidentiality.’”) Further, the Ninth Circuit

has cautioned that “Broad allegations of harm, unsubstantiated by specific examples or articulated

reasoning, do not satisfy the Rule 26(c) test.” Beckman Indus., Inc. v. International Ins. Co., 966

F.2d 470, 476 (9th Cir. 1992). Civil Local Rule 79-5 was promulgated to conform with this

requirement in situations where a party seeks to file part or all of a document under seal.

The requested modification to the Protective Order would hinder the parties’ ability to meet

and confer to remove any improper confidentiality designations before seeking to file the documents

with the court. This would lead to unnecessary work for both the court and the parties anytime a

party seeks to file such a document under seal, because of the mandatory procedures of Civil Local

Rule 79-5. The existing Protective Order adequately protects any legitimate confidentiality

concerns, while facilitating the removal of any improper confidentiality designations. Thus, Lead

Plaintiffs have not shown good cause for modifying the Protective Order to prevent parties from

challenging confidentiality designations.

Lead Plaintiffs contention that they will be precluded from obtaining relevant evidence

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ORDER, page 3

absent modification if the Protective Order is without merit. Lead Plaintiffs are free to move to

compel production of any relevant documents that are responsive to document requests Lead

Plaintiffs have served on Defendant Securities and Exchange Commission, or subpoenas they have

served on any non-party. In that event, it will be incumbent on either Defendant Securities and

Exchange Commission and/or the Office of the Comptroller of the Currency to assert any privilege

that they contend protects the responsive documents from production.

Dated: 11/6/06

 

PATRICIA V. TRUMBULL

United States Magistrate Judge

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