Recently, in the United States District Court for the District of Massachusetts in the matter Bock v. Daimler Trucks North America, LLC,1 a magistrate ordered the inclusion of a “sharing clause” in a discovery protective order in the product liability action. The plaintiff’s claims stem from a fatal motor vehicle accident in which his wife’s vehicle was rear-ended by a truck manufactured by defendant Daimler Trucks North America, LLC. The plaintiff claims the truck was defective due to Daimler’s failure to equip the truck with its proprietary collision avoidance technology.
Daimler moved for a protective order, arguing that the plaintiff’s proposed order, which included a “sharing clause” that would permit the plaintiff and his counsel to share Daimler’s confidential documents with other attorneys and parties involved in “similar litigation” against Daimler, posed a risk to Daimler’s ability to protect its industry-leading confidential information in avoidance technology from falling into the hands of competitors. The court denied Daimler’s request for a protective order without a sharing clause for several reasons.
Most significantly, the court found that Daimler had failed to carry its burden of demonstrating “good cause” for a protective order without a sharing clause. The court rejected Daimler’s argument that the plaintiff conceded good cause by agreeing to a protective order, explaining that when there is a dispute as to the scope of a protective order, the party seeking confidentiality has the burden of demonstrating good cause. The court also explained that Daimler failed to present an affidavit providing a particularized showing of the “competitive risks” Daimler would face if its confidential information was shared with other plaintiffs’ attorneys.
Second, the court found that the restrictions contained in the “sharing clause” proposed by the plaintiff provided adequate protection to prevent Daimler’s information from being shared outside of litigation. The restrictions included a notice provision giving Daimler 30 days to object before any confidential information is shared. Additionally, lawyers receiving confidential information had to provide a certification within 30 days of their litigation concluding attesting that the documents and any copies were destroyed. Lastly, lawyers accepting information under the sharing clause had to sign an acknowledgment of the District of Massachusetts’s jurisdiction to impose sanctions for any violation of the protective order.
Finally, the plaintiff also pointed to the fact that Daimler had previously agreed to a “sharing clause” in separate litigation in Pennsylvania. The plaintiff argued and the court apparently agreed that the sharing provision in the separate litigation detracted from Daimler’s argument that it would suffer irreparable harm if the confidential information were shared.
Daimler’s objection to the magistrate’s order is still pending before the district court judge.
The court’s opinion in Bock presents several lessons for corporations attempting to protect their proprietary and confidential information in discovery, including in products liability litigation. If you are seeking to restrict access to your confidential information, you bear the burden of demonstrating good cause for your requested restriction on dissemination of your confidential information. Good cause requires a particularized showing of harm that will result if confidential information is disclosed outside of litigation. Arguments of counsel and reliance on prior cases granting protective orders in similar cases do not establish good cause.
Also, agreeing to a “sharing clause” in one case will likely affect your ability to protect the same or similar confidential information in future separate litigation.
If you have any questions regarding the content of this alert, please contact Nick Pompeo, associate, at npompeo@barclaydamon.com; Matthew Larkin, Torts & Products Liability Defense Practice Area chair, at mlarkin@barclaydamon.com; or another member of the firm’s Torts & Products Liability Defense Practice Area.
1C.A. No, 3:24-cv-30099-MGM.