Union Pacific Railroad Company v. Colony National Insurance Company et al
MEMORANDUM AND ORDER that Defendant Colony National Insurance Company's Motion in Limine Regarding Confidentiality and Sealing of Materials, ECF No. 215 , is denied, without prejudice to reassertion after trial. Ordered by Chief Judge Laurie Smith Camp. (LAC)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
UNION PACIFIC RAILROAD COMPANY,
CASE NO. 8:13CV84
COLONY NATIONAL INSURANCE
This matter is before the Court on a Motion in Limine, ECF No. 215, submitted by
Defendant Colony National Insurance Company (Colony), seeking to remove certain
depositions and exhibits from the scope of a Protective Order, ECF No. 84. For the
reasons discussed below, Colony’s Motions will be denied, without prejudice to
reassertion after trial.
This case is set for a trial to the bench, commencing on March 20, 2018. At
issue is whether Colony, the excess insurer for a contractor (DBI) hired by UP to cut
vegetation at a railroad crossing, must indemnify UP for part of UP’s $6.5 million pretrial settlement of an Oklahoma wrongful death action (Underlying Action).
“To prove allocation, parties can present testimony from attorneys involved in the
underlying lawsuits, evidence from those lawsuits, expert testimony evaluating the
lawsuits, a review of the underlying transcripts, or other admissible evidence.”
UnitedHealth Group, Inc. v. Executive Risk Specialty Ins., 870 F.3d 856, 863 (8th Cir.
2017) (citing Nodaway Valley Bank v. Cont’l Cas. Co., 916 F.2d 1362, 1365–66 (8th Cir.
“The allocation inquiry examines how a reasonable party in [the insured’s]
position would have valued the covered and non-covered claims. In evaluating the
claims, we look to what the parties knew at the time of settlement.” Id. “Allocation
require[s] either contemporaneous evidence of valuation or expert testimony on relative
value to provide a reasonable foundation for a [fact-finder’s] decision.” Id. at 865.
On July 10, 2015, Magistrate Judge F.A. Gossett issued a Protective Order, ECF
No. 84, at the joint request of the parties. The Protective Order allowed the parties to
designate information, documents, and testimony produced during discovery as
“confidential,” limiting the disclosure of such material to the parties, the Court, and other
listed categories of persons associated with this case. Under the Protective Order, if
counsel for a non-disclosing party objected to a disclosing party’s designation of
material as “confidential,” counsel for the non-disclosing party could notify counsel for
the disclosing party, in writing, specifying the materials improperly classified and the
basis for the objection. Upon receipt of such an objection, counsel for both parties had
an obligation to negotiate in good faith to resolve the objection. If such negotiation
failed, counsel for the disclosing party could file a motion with the Court within 30 days
of the objection, regarding the designation of the material as confidential. If no such
motion were timely filed, the materials would no longer be considered confidential. Id.
On February 13, 2018, counsel for Colony sent a written objection to counsel for
UP, by email, objecting to UP’s designation of the following depositions and exhibits as
“confidential”: Depositions of John Ziegler, Richard Hautzinger, Robert Hart, Joseph
Ferris, Jay Pfeiffer, Joe Ferguson, and Sharon Van Dyke; and Exhibits 300-302, 30405, 308-13, 315-19, 372, 374, 383, 388, 395, 397-99, 434, 458-460, and 462. Colony
argues that the public has a common law right of access to public proceedings in
general, citing IDT Corp. v. Ebay, 709 F.3d 1220, 1223 (8th Cir. 2013), and a strong
interest in access to the materials at issue here, because they relate to matters of public
health and safety, citing Healey v. I-Flow, LLC, 282 F.R.D. 211, 214 (D. Minn. 2012).
Under the terms of the Protective Order, UP had until March 15, 2018, to file a
motion with the Court regarding the designation of the materials as confidential. The
Court finds that UP’s Brief in Opposition to Colony’s Motion in Limine, ECF No. 243,
satisfied that requirement. In its Brief, UP argues that Colony failed to present a valid
objection to UP’s designation of materials as “confidential,” because Colony did not
state a basis for its objection, as required by the Protective Order. UP also notes that
Colony will be under no disadvantage at trial by virtue of UP’s designation of certain
materials as “confidential,” because Colony has had full access to all the materials. UP
asserts the materials should remain confidential because they would be protected by
attorney-client or work-product privileges, but for UP’s limited waiver of such privileges
for purposes of this allocation proceeding, and the materials could be used against UP
unfairly if released to the public or to witnesses and attorneys involved in adversary
proceedings with UP. Finally, UP notes it is unclear how and whether the depositions
and exhibits listed by Colony in its objection will be used at trial.
With regard to Colony’s basis for its objection, it is asserting the common law
right of the public to gain access to judicial records, noting that the public interest in
such access is especially strong when public health and safety are at issue.
In IDT, a public law center moved to unseal a complaint in a patent infringement
case. 709 F.3d at 1221. The district court denied the request, and the Court of Appeals
remanded the matter for the district judge to consider redaction as an alternative means
of protecting sensitive business information. Id. The Eighth Circuit recognized the
common-law right of access to judicial records in civil proceedings, but noted that the
right is not absolute. Id. at 1222 (citing In re Reporters Comm. For Freedom of the
Press, 773 F.2d 1325, 1333 (D.C. Cir. 1985); Nixon v. Warner Commc’ns., Inc., 435
U.S. 589, 597 (1978), and In re Reporters Comm. For Freedom of the Press, 773 F.2d
1325, 1333 (D.C. Cir. 1985)). It observed that the companies asserting confidentiality
acquiesced to treatment of the complaint as a “judicial record” subject to the
presumption of public access. Id. Because the presumption of public access therefore
attached, it was incumbent upon the district judge to “consider the degree to which
sealing a judicial record would interfere with the interests served by the common-law
right of access and balance that interference against the salutary interests served by
maintaining confidentiality of the information sought to be sealed.” Id. at 1223.
In Healey, a U.S. Magistrate Judge in the District of Minnesota unsealed certain
documents in an action brought against the manufacturer of a medical pain pump. 282
F.R.D. at 216. The Magistrate Judge quoted Grove Fresh Distribs., Inc. v. Everfresh
Juice Co., 24 F.3d 893, 898 (7th Cir. 1994), for the proposition that “the common law
right of access applies to all ‘judicial decisions and the documents which comprise the
bases for those decisions.’” Id. at 214. He noted that the party seeking to maintain
confidentiality has the burden of overcoming the presumption of public disclosure by
demonstrating compelling reasons for confidentiality, such as the likelihood that
disclosure will harm the party. Id. at 215 (citing In re Neal, 461 F.3d 1048, 1053 (8th
Cir. 2006)). He also observed that such questions of fact should be resolved by the
court after receiving evidence. Id. at 214 (citing In re Iowa Freedom of Info. Council,
724 F.2d 658, 663 (8th Cir. 1983)).
Here, only one of the exhibits listed by Colony in its objection, 318, was received
into evidence at the pretrial conference. See Order on Final Pretrial Conference, ECF
No. 237, Page ID 8122.
It is unclear at this time whether the other exhibits and
depositions will be offered and received, or used at trial in any other manner. In its
Reply Brief, ECF No. 246, Colony “limits its challenge to the Documents that are
actually used at trial by Union Pacific or Colony.” Id. at Page ID 8279.
Colony appears to concede that the depositions and exhibits listed in its objection
are not yet “judicial records” subject to the presumption of public access, and it would
be premature for the Court to attempt to rule on Colony’s objection. If the exhibits and
depositions listed by Colony in its objection are received into evidence at trial, Colony
may reassert its objection to UP’s designation of the exhibits and depositions as
“confidential.” At that time, the Court will determine whether the material is a “judicial
record,” subject to the presumption of public access; and, if so, will conduct a review of
such material to weigh the competing interests and determine whether UP has
overcome the presumption of public disclosure.
IT IS ORDERED:
Defendant Colony National Insurance Company’s Motion in Limine Regarding
Confidentiality and Sealing of Materials, ECF No. 215, is denied, without
prejudice to reassertion after trial.
Dated this 13th day of March, 2018.
BY THE COURT:
s/Laurie Smith Camp
Chief United States District Judge
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