Cave Consulting Group, Inc. v. Truven Health Analytics Inc.

Filing 213

ORDER DENYING PLAINTIFF'S ADMINISTRATIVE MOTION TO RETAIN CONFIDENTIALITY DESIGNATIONS (Illston, Susan) (Filed on 5/1/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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CAVE CONSULTING GROUP, INC.,

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Plaintiff,

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v.
TRUVEN HEALTH ANALYTICS INC.,

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United States District Court
Northern District of California

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Defendant.

Case No. 15-cv-02177-SI
ORDER DENYING PLAINTIFF’S
ADMINISTRATIVE MOTION TO
RETAIN CONFIDENTIALITY
DESIGNATIONS
Re: Dkt. No. 163

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Plaintiff has filed an administrative motion to retain the confidentiality designations for

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two documents produced by plaintiff in this case. The documents are a 2002 proposal for a

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physician efficiency study sent by Dr. Cave to the Centers for Medicare and Medicaid Services

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(“CMS”) and a 2003 report to CMS on the results of the study. Plaintiff designated both

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documents as “Highly Confidential – Attorneys’ Eyes Only” pursuant to the Protective Order in

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this case. The 2002 proposal sought to use medical claims data from CMS for the physician

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efficiency study. Plaintiff states that the CMS claims data is available for use by members of the

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public under strictly defined circumstances.

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Plaintiff asserts that the 2002 proposal should remain confidential because when Dr. Cave

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submitted the proposal, it was his “understanding and expectation” that the information will be

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kept confidential. Cave Decl. ¶ 8 (Dkt. No. 163-12). Plaintiff asserts that this expectation was

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based on the fact that the 2002 proposal contained Dr. Cave’s study protocol, and “[i]ndividuals

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working in the healthcare industry recognize both the necessity of collaboration and the imperative

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of confidentiality.” Plaintiff’s Motion at 4 (Dkt. No. 163-4); Cave Decl. ¶ 8. Plaintiff argues that

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if the study protocol was made public, current and prospective competitors of plaintiff could use

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the protocol as a shortcut to developing their own research, causing competitive harm to plaintiff.

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Plaintiff argues that it would seriously harmed if the 2003 report became public because

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plaintiff is strictly prohibited from disclosing the results of the study without the approval of CMS.

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Plaintiff states that nearly all of plaintiff’s clients manage Medicare- and Medicaid-related work

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for CMS, and plaintiff’s agreements with its clients are predicated on plaintiff remaining in good

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standing with CMS.
Defendant argues that plaintiff has failed to show that the documents contain highly

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confidential information subject to protection under the Protective Order. Defendant also argues

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that plaintiff has not met its burden to show that any specific harm or prejudice will result from the

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disclosure of either document. Defendant notes that both documents are letters from Dr. Cave to a

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third-party, CMS. Defendant further notes that that neither document indicates that Dr. Cave

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United States District Court
Northern District of California

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intended that the communication was confidential at the time that it was sent.

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For good cause, the Court may protect information such as “trade secret[s] or other

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confidential research, development, or commercial information.” Fed. R. Civ. P. 26(c)(1)(G). “A

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party asserting good cause bears the burden, for each particular document it seeks to protect, of

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showing that specific prejudice or harm will result” if a protective order is lifted. Foltz v. State

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Farm Mut. Auto Ins. Co., 331 F.3d 1122, 1130 (9th Cir. 2003) (citations omitted).

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When a party challenges the confidentiality of information under a protective order, the

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Court must conduct a two-step analysis. “First, it must determine whether particularized harm will

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result from disclosure of information to the public.”

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Portland in Ore., 661 F.3d 417, 424 (9th Cir. 2011) (quotation omitted). “Broad allegations of

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harm, unsubstantiated by specific examples or articulated reasoning, do not satisfy the Rule 26(c)

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test.” Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (citing Seattle

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Times Co. v. Rhinehart, 467 U.S. 20, 36 (1984)). The party seeking to maintain confidentiality

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must “allege specific prejudice or harm.” Id. “Where a business is the party seeking protection, it

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will have to show that disclosure would cause significant harm to its competitive and financial

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position. That showing requires specific demonstrations of fact, supported where possible by

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affidavits and concrete examples, rather than broad, conclusory allegations of harm.” Contratto v.

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Ethicon, Inc., 227 F.R.D. 304, 307 (N.D. Cal. 2005) (citation and internal quotations omitted).
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In re Roman Catholic Archbishop of

“Second, if the court concludes that such harm will result from disclosure of the discovery

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documents, then it must proceed to balance the public and private interests to decide whether

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maintaining a protective order is necessary.” In re Roman Catholic Archbishop, 661 F.3d at 424.

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The Court considers the following list of non-exhaustive factors: “(1) whether disclosure will

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violate any privacy interests; (2) whether the information is being sought for a legitimate purpose

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or for an improper purpose; (3) whether disclosure of the information will cause a party

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embarrassment; (4) whether confidentiality is being sought over information important to public

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health and safety; (5) whether the sharing of information among litigants will promote fairness and

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efficiency; (6) whether a party benefitting from the order of confidentiality is a public entity or

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official; and (7) whether the case involves issues important to the public.” Id. at 424 n.5 (quoting

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United States District Court
Northern District of California

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Glenmede Trust Co. v. Thompson, 56 F.3d 476, 483 (3d Cir. 1995)).

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The Court concludes that plaintiff has failed to meet its burden to show that the documents

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at issue should retain their confidentiality designations. Plaintiff has not demonstrated that the

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2002 proposal contains information that reflects “a trade secret or other confidential research,

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development, or commercial information” as required by Rule 26. Instead, plaintiff generally

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describes the 2002 proposal as containing Dr. Cave’s “study protocol for evaluating physician

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efficiency.” However, plaintiff does not identify any specific information that supports a “Highly

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Confidential – Attorneys’ Eyes Only” designation.

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Further, there is nothing from the face of the 2002 proposal that indicates it was meant to

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be kept confidential. Dr. Cave’s 2017 declaration stating that it was his “understanding and

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expectation” that CMS would keep the information confidential does not, without more, establish

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that the document is entitled to protection. As defendant notes, although plaintiff repeatedly refers

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to “obligations under CMS regulations,” plaintiff does not identify any specific CMS regulation,

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nor does plaintiff describe any specific confidentiality obligations imposed by a CMS regulation

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regarding the 2002 proposal.

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prospective competitors of CCGroup could use the protocol as a shortcut to developing their own

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research” is a “[b]road allegation[] of harm, unsubstantiated by specific examples or articulated

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reasoning [that does] not satisfy the Rule 26(c) test.” Beckman Industries, Inc., 966 F.2d at 476.

Finally, plaintiff’s assertion that, if disclosed, “current and

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Similarly, plaintiff has failed to meet its burden to show that the 2003 report is

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confidential. Plaintiff does not explain how the information in this document constitutes “a trade

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secret or other confidential research, development, or commercial information” under Rule 26(c).

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In addition, although plaintiff claims that it could lose its standing with CMS if the document

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became public, as defendant notes, the 2003 report is identified in the “References” section of the

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CCGroup Marketbasket System Manual in the list of “articles published by CCGroup that

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addresses physician efficiency and quality measurement.” Plaintiff’s assertions of harm that will

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flow from disclosure of the documents are not substantiated on this record.

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Accordingly, the Court DENIES plaintiff’s administrative motion and holds that the two

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documents at issue (CCGroup0000001-81 and CCGroup0006246-6288) are hereby de-designated.

United States District Court
Northern District of California

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IT IS SO ORDERED.

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Dated: May 1, 2017

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SUSAN ILLSTON
United States District Judge

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