The practice of defending automotive products liability suits lends itself to the potential for disclosure of proprietary documents and information relating to the design, manufacture, and cost of prototype and production vehicles. Much of this information contains trade secrets that could cause significant competitive harm if it falls into the wrong hands and/or the public domain. Most, if not all, product manufacturers will agree that such information requires protection during litigation, both in the discovery phase and beyond, no matter the type of product they manufacture.
Balancing the long standing public interest in access to the American courts against the confidential nature of the sensitive information disclosed in a trial setting can be difficult and force one or both parties to seek intervention from the courts to keep confidential information attached to or referenced in court filings under seal. Different circuits exercise different standards of review when evaluating whether to allow such information to be filed under seal and it is important for the proponent to be aware of what standard applies and what language to use to effectively protect your client's confidential information. In other words, circuits are split as to how to weigh the public's interest against the needs of a party to keep confidential information under wraps.
In the 2016 Ninth Circuit decision in The Center for Auto Safety v Chrysler Group, LLC, 809 F.3d 1092 (9th Cir. 2016), cert. den., ___ U.S. ___, 196 L. Ed. 2d 26 (2016), the court held that the burden to seal documents from the judicial record turns on whether the filing is "dispositive" versus "non-dispositive." In other words, if the filing is unrelated to the merits of the case (i.e., non-dispositive), the party must only meet a good cause standard for restricting the public's right to access the information. Conversely, if the filing is directly related to the merits of the case or is determinative of the litigant's substantive rights (i.e., dispositive), then a party must meet a higher burden of showing that compelling reasons exist to overcome the presumption of the public's right of access.
Other circuits make similar distinctions. The Fifth, Sixth, Tenth and Eleventh Circuits follow suit with the Ninth Circuit. For example, the Sixth Circuit determined that, during discovery, parties may liberally designate information as being subject to a protective order on a showing of good cause. Shane Group, Inc. v Blue Cross Blue Shield of MI, 825 F.3d 299, 305 (6th Cir 2016) citing Fed. R. Civ. P. 26(c)(1)). But "[a]t the adjudication stage . . . different considerations apply" because the public has a strong interest in information placed in the public record. Id. Thus, according to the Sixth Circuit, the proponent of a sealing request for a merits-based motion must explain why there are compelling reasons for sealing the records and why those reasons outweigh the public's interest in disclosure. Id. at 307. Further, even when compelling justifications exist, the district court's sealing order must be narrowly tailored to serve the proffered justifications. Id. at 306. The district court "must set forth specific findings and conclusions, which justify nondisclosure to the public." Id. See also United States v McVeigh, 119 F.3d 806, 811 (10th Cir 1997) ("There is a presumption that documents which are essential to the judicial process are to be available to the public, but access to them may be restricted when the public's right of access is outweighed by interests which favor nondisclosure." ).
