Menendez et al v. Wal-Mart Stores, Inc. et al
Filing
234
OPINION AND ORDER DENYING WITHOUT PREJUDICE 225 defendants' Motion for Protective Order; DENYING AS MOOT 231 Plaintiffs' Motion to Strike the Defective Affidavit of Brent M Hoover. Signed by Magistrate Judge Roger B Cosbey on 1/11/12. (jcp)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
HUMBERTO GUSTAVO MENENDEZ,
deceased by Marla Melissa Menendez
representative, et al.,
Plaintiffs,
v.
WAL-MART STORES EAST LP, et al.,
Defendants,
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Case No: 1:10-cv-53
OPINION AND ORDER
Before the Court is a Motion for Protective Order (Docket # 225) filed by Defendants
JLG Industries, Inc.; Wal-Mart Stores East, LP; Wal-Mart Realty Company; Walton
Construction Company, Inc.; Walton Construction Company, LLC; and Hansen-Rice, Inc.
(collectively, the “Defendants”), requesting that the Court approve and adopt their proposed
Protective Order that seeks to maintain as confidential their “equipment and building blueprints,
engineering documents, specifications, designs and/or construction layouts.”1 (Docket # 230 Ex.
1 ¶ 1.) Plaintiffs Marla Melissa Menendez, individually and as representative of the Estate of
Humberto Gustavo Menendez, and Humberto’s wife and two other daughters (collectively, the
“Plaintiffs”) contend that Defendants’ proposed Protective Order is too restrictive and that a
“sharing protective order,” which provides that confidential information may be shared with
lawyers handling similar cases, is more appropriate.2 (Docket # 228.)
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Defendants NES Rentals Holdings, Inc., and NES Equipment Services Corporation have not joined in, or opposed,
the Motion for Protective Order.
2
Together with their reply brief, Defendants filed the Affidavit of Brent M. Hoover (Reply Br. Ex. 2), which
describes the steps that JLG takes to protect the secrecy of its blueprints and engineering documents. Plaintiffs filed
Ultimately, Plaintiffs’ objection to the proposed Protective Order is unpersuasive, as
good cause exists for the entry of a protective order with respect to Defendants’ proposed
category of proprietary blueprints and engineering information. Nevertheless, due to several
deficiencies in Defendants’ proposed Protective Order, the Motion for Protective Order will be
DENIED WITHOUT PREJUDICE.
A. Factual and Procedural Background
Plaintiffs sued Defendants for negligence in Hidalgo County, Texas, District Court after
Humberto Gustavo Menendez became pinned between an overhead steel structure and an aerial
lift basket while working on the premises of Wal-Mart on November 20, 2006, resulting in his
subsequent death. (Docket # 1.) The lift was designed and manufactured by JLG and apparently
rented to building contractors by NES. (Docket # 1.)
Defendants timely removed this case to federal court in the Southern District of Texas on
November 26, 2008, under 28 U.S.C. § 1332(a). (Docket # 1.) On February 11, 2010, the case
was transferred to the Northern District of Indiana. (Docket # 116.) A scheduling conference
was conducted on June 8, 2010, at which the Court set an August 1, 2011, deadline for the
completion of all discovery. (Docket # 160.) The discovery deadline was later extended to
August 15, 2012. (Docket # 216.) On November 17, 2011, Defendants filed the instant Motion
for Protective Order. (Docket # 225.)
a motion to strike this Affidavit (Docket # 231), contending that “it is nothing more than an unsworn statement”
because it “does not comply with the foundational requirements of being sworn under the penalties of perjury” and,
in any event, “new evidence in a reply is usually not allowed . . . .” (Pls.’ Mot. to Strike ¶¶ 1, 4.) Defendants filed a
response to the motion to strike, and Plaintiffs timely replied. (Docket # 232-33.) As described in footnote 4 infra,
Plaintiff’s motion to strike ultimately has no bearing on the Court’s ruling on Defendants’ Motion for Protective
Order, and therefore the motion to strike will be DENIED AS MOOT.
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B. Applicable Legal Standard
“Absent a protective order, parties to a law suit may disseminate materials obtained
during discovery as they see fit.” Jepson, Inc. v. Makita Elec. Works, Ltd., 30 F.3d 854, 858 (7th
Cir. 1994). However, “[p]ursuant to Federal Rules of Civil Procedure 26(c)(1)(G), the court may
enter a protective order ‘requiring that a trade secret or other confidential research development,
or commercial information not be revealed or be revealed only in a specified way.’” Kraft Foods
Global, Inc., No. 10 C 8006, 2011 WL 1557881, at *1 (N.D. Ill. Apr. 25, 2011) (quoting Fed. R.
Civ. P. 26(c)(1)(G)). “The party requesting a protective order has the burden of demonstrating to
the court that ‘good cause’ exists for its issuance.” Jepson, 30 F.3d at 858. “The ‘good cause’
standard requires a balancing of the public and private interests involved.” Cook, Inc. v. Boston
Scientific Corp., 206 F.R.D. 244, 246-47 (S.D. Ind. 2001) (citing Citizens First Nat’l Bank of
Princeton v. Cincinnati Ins. Co., 178 F.3d 943, 946 (7th Cir. 1999)).
In establishing good cause, a protective order must only extend to “properly demarcated
categor[ies] of legitimately confidential information.” Cincinnati Insurance, 178 F.3d at 946; see
MRS Invs. v. Meridian Sports, Inc., No. IP 99-1954-C-F/M, 2002 WL 193140, at *1 (S.D. Ind.
Feb. 6, 2002) (rejecting proposed protective order because categories of protected information
were overly broad and vague). For material to be protected, it “must give the holder an
economic advantage and threaten a competitive injury—business information whose release
harms the holder only because the information is embarrassing or reveals weaknesses does not
qualify for trade secret protection.” Cook, 206 F.R.D. at 248-49 (emphasis omitted). “The risk . .
. that the party receiving the discovery will share it with others does not alone constitute good
cause for a protective order.” Wauchop v. Domino’s Pizza, Inc., 138 F.R.D. 539, 545 (N.D. Ind.
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1991).
C. Analysis
Defendants’ proposed Protective Order defines the term “Confidential Information” as
“equipment and building blueprints, engineering documents, specifications, designs and/or
construction layouts, which depict or contain information which JLG Industries, Inc., the WalMart Defendants, Defendant Hansen-Rice, Inc[.,] and the Walton Defendants keep secret from
their competitors and is not readily ascertainable by their competitors.” (Proposed Protective
Order p. 1. ¶ 1.) Defendants explain that “good cause” exists for the Protective Order, asserting
that disclosure of the Confidential Information “would threaten them with competitive injury
because it would allow competitors to easily duplicate their designs.” (Mot. for Protective Order
2.)
As stated earlier, “[a] protective order may authorize the parties to restrict public access
to properly demarcated categories of legitimately confidential discovery documents if the judge .
. . . satisfies himself that the parties know what the legitimate categories of protectable
information are and are acting in good faith in deciding which parts of the discovery information
qualify . . . .” Cook, 206 F.R.D. at 247. Here, Defendants have adequately proposed a “properly
demarcated categor[y] of legitimately confidential discovery documents” and described “the
competitive harm likely to result from the disclosure” of such Confidential Information. Id. at
247-48.
In fact, Plaintiffs do not even challenge Defendants’ proposed definition of “Confidential
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Information” in their response to the Motion for Protective Order.3 (See Docket # 228.) Rather,
their sole point of contention with Defendants’ proposed Protective Order is whether Plaintiffs
are entitled to the inclusion of a “sharing provision” in the order that allows Plaintiffs to share
Defendants’ Confidential Information with other attorneys representing plaintiffs in similar
lawsuits.4 (Resp. Br. 4-10.)
In that regard, “[u]se of the discovery fruits disclosed in one lawsuit in connection with
other litigation, and even in collaboration among plaintiffs’ attorneys, comes squarely within the
purposes of Federal Rules of Civil Procedure . . . . Such cooperation among litigants promotes
the speedy and inexpensive determination of every action as well as conservation of judicial
resources.” Wauchop, 138 F.R.D. at 547 (quoting United States v. Hooker Chems. & Plastics
Corp., 90 F.R.D. 421, 426 (W.D.N.Y. 1981)); see Ward v. Ford Motor Co., 93 F.R.D. 579, 580
(D. Colo. 1982); Patterson v. Ford Motor Co., 85 F.R.D. 152, 154 (W.D. Tex. 1980) (“The
availability of the discovery information may reduce time and money which must be expended in
similar proceedings, and may allow for effective, speedy, and efficient representation.”); see also
Burlington City Bd. of Educ. v. U.S. Mineral Prods. Co., 115 F.R.D. 188, 190 (M.D.N.C. 1987)
(“Permitting plaintiffs to share information helps counterbalance the effect uneven financial
3
Although in one sentence in their response brief Plaintiffs suggest that Defendants “failed to prove the justification
for a protective order, and . . . specify information that needs to be protected” (Resp. Br. 3), “perfunctory and
undeveloped arguments, and arguments that are unsupported by pertinent authority, are waived . . . .” United States
v. Lanzotti, 205 F.3d 951, 957 (7th Cir. 2000); see Clarett v. Roberts, No. 09-2805, 2011 WL 4424790, at *8 (7th
Cir. Sept. 23, 2011); Gross v. Town of Cicero, 619 F.3d 697, 704-05 (7th Cir. 2010); United States v. Tockes, 530
F.3d 628, 633 (7th Cir. 2008); APS Sports Collectibles, Inc. v. Sports Time, Inc., 299 F.3d 624, 631 (7th Cir. 2002).
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Because Plaintiffs do not challenge Defendants’ proposed definition of “Confidential Information” and instead
simply argue that the proposed Protective Order should include a “sharing provision,” the Affidavit of Brent Hoover
describing the steps that JLG takes to maintain the secrecy of the Confidential Information is ultimately immaterial
to the Court’s decision. That is, even if Hoover’s Affidavit were stricken, the Court’s ruling would remain the same.
Therefore, Plaintiffs’ motion to strike will be DENIED AS MOOT.
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resources between parties might otherwise have on the discovery process, thereby protecting
economically modest plaintiffs faced with financially well off defendants and improving
accessibility to justice.”).
Here, however, Plaintiffs have failed to provide any evidence that such collateral lawsuits
actually exist. Consequently, any purported gain in judicial efficiency achieved in other cases
through “sharing orders” is purely hypothetical in this case. Cf. Baker v. Liggett Group, Inc., 132
F.R.D. 123, 126 (D. Mass. 1990) (finding that the sharing of discovery information was
particularly appropriate “in tobacco tort cases in which individual plaintiffs must litigate against
large, corporate defendants”); Ward, 93 F.R.D. at 579 (allowing sharing of discovery
information where several hundred “fuel system integrity cases” involving Ford Pintos, all
asserting the same design defect, had been filed in various district courts).
Furthermore, Defendants’ proposed Protective Order seeks to protect only a discrete,
properly demarcated category of propriety commercial information—Defendants’ equipment and
building blueprints, engineering documents, specifications, designs, and construction layouts that
are kept secret from their competitors. See, e.g., Wauchop, 138 F.R.D. at 547 (approving
defendant’s proposed protective order with respect to prohibiting the dissemination of
confidential proprietary information, but rejecting the proposed order as to defendant’s general
concern that any shared discovery might be detrimental to its parallel litigation). That is, this is
not a case where Defendants are attempting to seal all of their discovery documents based only
on a general concern that Plaintiffs might share them with others—a basis which clearly falls
short of establishing good cause. See, e.g., Ward, 93 F.R.D. at 579-80 (declining to enter a nonsharing protective order where plaintiffs voluntarily agreed not to disclose any trade secrets and
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the only remaining basis for the protective order was defendant’s fear that plaintiffs would
disclose discovery to certain “fly-by-night” non-lawyer experts); Hooker, 90 F.R.D. at 425-36
(finding that a non-sharing protective order was not warranted where defendants did not show
that trade secrets or other proprietary information would be disclosed and instead merely argued
that disclosure of discovery would be “detrimental to its position in parallel lawsuits”);
Patterson, 85 F.R.D. at 153) (denying defendant’s motion for a non-sharing protective order
where defendant did not show that discovery involved trade secrets or confidential proprietary
information, but instead simply expressed concern that plaintiff wanted to develop additional
litigation against defendant). As a result, Plaintiffs’ objection that Defendants’ proposed
Protective Order is too restrictive, and that a “sharing order” is more appropriate, is overruled.
Nevertheless, Defendants’ proposed Protective Order contains several deficiencies that
preclude its approval by the Court. First, the introductory paragraph of the proposed Protective
Order recites that Plaintiffs and the NES Defendants agree and stipulate to the Order. (Reply Br.
Ex. 1.) Of course, that is not the case, as Plaintiffs oppose the proposed Order and NES has not
weighed in on the matter.
In addition, the proposed Protective Order seeks to protect documents “containing”
Confidential Information, rather than solely protecting the Confidential Information itself
through a method of redaction. (Proposed Protective Order p. 2 ¶ 1.) However, an order sealing
documents containing confidential information is overly broad, as a document containing
confidential information may also contain material that is not confidential, in which case a
party’s interest in maintaining the confidentiality of the information would be adequately
protected by redacting only portions of the documents. Cincinnati Insurance, 178 F.3d at 945.
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Finally, the proposed order states that the provisions of the order “shall continue to be
binding” after termination of the litigation. (Proposed Protective Order ¶ 12.) The Court,
however, is unwilling to enter a protective order that suggests it retains jurisdiction of any kind
after the resolution of the case. See E.E.O.C. v. Clarice’s Home Care Serv., Inc., No.
3:07-cv-601 GPM, 2008 WL 345588, at *2 (S.D. Ill. Feb. 7, 2008); Large v. Mobile Tool Int’l,
Inc., No. 1:02-CV-177, 2010 WL 3120254, at *1 (N.D. Ind. Aug. 6, 2010).
In sum, “[o]btaining a protective order in an appropriate case need not be a[n] onerous
task. But such an order may not issue absent an appropriate showing of good cause, as well as
adherence to the other limitations the Seventh Circuit has emphasized apply to such orders.”
Shepard v. Humke, No. IP 01-1103-C-H/K, 2003 WL 1702256, at *2 (S.D. Ind. Mar. 28, 2003).
Therefore, for the foregoing reasons, the Court will DENY Defendants’ Motion for Protective
Order. Defendants may, however, submit a revised protective order that cures the identified
deficiencies and is consistent with the requirements of Rule 26(c)(1)(G) and Seventh Circuit case
law.
D. Conclusion
For the foregoing reasons, Defendants’ Motion for Protective Order (Docket # 225) is
DENIED WITHOUT PREJUDICE. Plaintiffs’ Motion to Strike the Defective Affidavit of Brent
M. Hoover (Docket # 231) is DENIED AS MOOT.
SO ORDERED. Entered this 11th day of January, 2012.
s/Roger B. Cosbey
Magistrate Judge
United States District Court
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