The Charter Oak Fire Insurance Company v. Electrolux Home Products, Inc.

Filing 101

ORDER granting 90 Motion to Amend/Correct/Supplement. For the reasons set forth in the attached Memorandum and Opinion, IT IS HEREBY ORDERED that the plaintiff's motion to modify the Protective Order is granted. Paragraph 4(a) of the Protec tive Order is modified so that material designated as confidential may be disclosed to "Attorneys from any law firm that is of record for any named party (and the named partys in-house counsel) to this action or any other pending or future action between the parties (including any parent or subsidiary company) that involves a dryer fire in which it is alleged that lint ignited in the heater pan." SO ORDERED. Ordered by Judge Joseph F. Bianco on 8/15/2012. (O'Neil, Jacquelyn)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
_____________________
No 10-CV-1351 (JFB)(WDW)
_____________________

THE CHARTER OAK FIRE INSURANCE COMPANY A/S/O HULIS & SALIHA
MAVRUK,
Plaintiff,
VERSUS

ELECTROLUX HOME PRODUCTS, INC.,
Defendant.
___________________
MEMORANDUM AND ORDER
August 15, 2012
___________________

JOSEPH F. BIANCO, District Judge:
Plaintiff The Charter Oak Fire Insurance
Company, as subrogee of Hulis and Saliha
Mavruk (“Charter Oak” or “plaintiff”),
brought this action against Electrolux Home
Products, Inc. (“Electrolux” or “defendant”),
claiming that Electrolux’s design of its
dryers is defective. Charter Oak alleges
theories of strict liability and negligence.
Specifically, Charter Oak claims that
Electrolux’s core dryer design has a
fundamental design defect, namely, that lint
accumulates in a heater pan behind the dryer
drum which ultimately ignites by either the
gas or electric heat source located
immediately adjacent to the pan.
On June 14, 2010, plaintiff and
defendant filed a Stipulated Protective Order

with the Court, which governed the
confidentiality of materials and information
disclosed during discovery.
Magistrate
Judge William D. Wall entered this Order on
June 16, 2010 (the “Protective Order”).
Pursuant to the Protective Order, all
protected material produced in the instant
action “shall only be used in connection
with the preparation, trial and appeal, if any,
of this action and shall not be used for any
other purpose. . . .” (Joint Motion for
Protective
Order/Stipulated
Protective
Order, June 14, 2012, ECF No. 6.) Plaintiff
now moves to modify the Protective Order
to allow documents and testimony produced
in this case to be shared by lawyers
representing plaintiff, or one of its parent or
subsidiary companies, in other cases against
Electrolux based on similar facts and
circumstances, i.e., a dryer fire in which it is

alleged that lint ignited in the heater pan.
For the reasons set forth below, the Court
grants plaintiff’s motion to modify the
Protective Order.

protective order” because “[i]f previouslyentered protective orders have no
presumptive entitlement to remain in force,
parties would resort less often to the judicial
system for fear that such orders would be
readily set aside in the future.” Id. at 229-30
(internal citations omitted).
However,
“[w]here a litigant or deponent could not
reasonably have relied on the continuation
of a protective order a court may properly
permit modification of the order.” Id. at
231; see also In re September 11 Litig., 262
F.R.D. 274, 277 (S.D.N.Y. 2009)
(“Importantly, this heightened standard
applies only if a party has ‘reasonably
relied’ on the protective order.” (citation
omitted)). “‘An examination of Second
Circuit case law reveals the following
factors are relevant when determining
whether a party has reasonable relied on the
protective order (1) the scope of the
protective order; (2) the language of the
order itself; (3) the level of inquiry the court
undertook before granting the order; and (4)
the nature of reliance on the order.’” In re
September 11, 262 F.R.D. at 277 (quoting In
re EPDM Antitrust Litig., 255 F.R.D. 308,
318 (D. Conn. 2009)).
“Additional
considerations that may influence a court’s
decision to grant modification include: the
type of discovery material the collateral
litigant seeks and the party’s purpose for
seeking modification.” In re EPDM, 255
F.R.D. at 318.

PROCEDURAL HISTORY1

I.

Plaintiff filed its motion to modify the
Protective Order on June 14, 2012.
Defendant filed its Opposition on July 9,
2012. Plaintiff filed a reply on July 16,
2012. The parties participated in a
telephone conference on July 30, 2012 to
address the motion to modify the Protective
Order. The Court has fully considered all of
the arguments presented by the parties.
II.

LEGAL STANDARD

“Where there has been reasonable
reliance by a party or deponent, a District
Court should not modify a protective order
granted under Rule 26(c) ‘absent a showing
of improvidence in the grant of [the] order
or some extraordinary circumstance or
compelling need.’” S.E.C. v. TheStreet.com,
273 F.3d 222, 229 (2d Cir. 2001) (citing
Martindell v. Int’l Tel. & Tel. Corp., 594
F.2d 291, 296 (2d Cir. 1979)).2 The Second
Circuit has held that “[t]here is a strong
presumption against the modification of a
1

The factual background of this case is set forth in
this Court’s Memorandum and Opinion dated July
30, 2012, in which the Court denied defendant’s
motion for summary judgment. Charter Oak Fire
Ins. Co. v. Electrolux Home Products, Inc., --- F.
Supp. 2d ----, No. 10-CV-1351 (JFB)(WDW), 2012
WL 321765, at *2-3 (E.D.N.Y. July 30, 2012).
2
Plaintiff argues that the Martindell standard does
not apply to this case because, inter alia, “Martindell
and TheStreet.com involved attempts by unrelated,
thirty-party intervenors to modify a protective order.”
(Pl.’s Reply. Br. at 3.) However, because, as
discussed infra, the Court has determined that the
defendant has not “reasonably relied” on the
Protective Order, and that plaintiff has demonstrated
“extraordinary circumstances” or “compelling need”
to modify the Protective Order, the Court need not
address this issue.

Moreover, an example of an
“extraordinary circumstance” is when the
“[d]efendants were never required to show
good cause for sealing various documents.”
See Fournier v. Erickson, 242 F. Supp. 2d
318, 341 (S.D.N.Y. 2003). Thus, when
parties file a stipulated agreement that is
Ordered by the court, “In the absence of the
requisite good cause showing, it cannot be
presumed that every piece of discovery filed
under the Order is actually worthy of such a
2

if that discovery would have been required
to be disclosed in the absence of a protective
order. Id. In this case, the Protective Order
is a blanket protective order. In order for a
document produced during discovery to be
protected, the producing party or third party
need only stamp it “CONFIDENTIAL,” or
some other similar designation. (Protective
Order ¶ 3.) Thus, the scope of the Protective
Order in this case favors modification.

high level of protection.” In re EPDM, 255
F.R.D. at 322; see also Lugosch III v.
Pyramid Co. of Onondaga, 435 F.3d 110,
126 (2d Cir. 2006) (“[T]he mere existence of
a confidentiality order says nothing about
whether complete reliance on the order to
avoid disclosure was reasonable.”).
III.

DISCUSSION

Defendant argues that plaintiff has not
met the requirements of the Martindale
standard because plaintiff has not
established some extraordinary circumstance
or compelling need to justify modification
and because Electrolux reasonably relied on
the continuation of the Protective Order.
Thus, defendant argues that the Protective
Order should not be modified. Plaintiff
counters that Electrolux has failed to
demonstrate that it has relied on the
continuation of the Protective Order and that
Charter Oak has demonstrated an
extraordinary circumstance or compelling
reason to modify the Protective Order. For
the reasons set forth below, this Court agrees
with the plaintiff and grants plaintiff’s
motion.

Second, the language of the protective
order itself is helpful in determining whether
the defendant could have reasonably relied
on the protective order’s continuation.
“Where a protective order contains express
language that limits the time period for
enforcement,
anticipates
potential
modification,
or
contains
specific
procedures for disclosing confidential
materials to non-parties, it is not reasonable
for a party to rely on an assumption that it
will never be modified.” In re EPDM, 255
F.R.D. at 320; see also TheStreet.com, 273
F.3d at 231 (“For instance, protective orders
that are on their face temporary or limited
may not justify reliance by the parties.”).

First, when analyzing the scope of a
protective order, “[i]t is relevant whether the
order is a blanket protective order, covering
all documents and testimony produced in the
lawsuit, or whether it is specifically focused
on protecting certain documents or certain
deponents for a particular reason.” In re
EPDM, 255 F.R.D. at 319. In the case of a
“blanket protective order,” it is more
difficult to show a party reasonably relied.
Id. Moreover, “[s]tipulated blanket orders
are even less resistant to a reasonable
request for modification.” Id. (emphasis in
original) (citing Beckman Indus., Inc. v. Int’l
Ins. Co., 966 F.2s 470, 476 (9th Cir. 1992)).
This is because a blanket protective order
will protect most, if not all, discovery, even

The language in the Protective Order in
this case suggests that the parties understood
that the Protective Order could be modified.
First, paragraph 8 addresses how parties
would
challenge
a
confidentiality
designation.
(Protective Order ¶ 8.)
Paragraph 8 begins by stating the following:
“A Party shall not be obliged to challenge
the propriety of a designation under this
Order at the time made, and the failure to do
so shall not preclude a subsequent challenge
thereto.” (Id.) Thus, a party is permitted,
pursuant to the Protective Order, to
challenge a confidentiality designation and
is not restricted to a time frame. Thus,
Electrolux cannot reasonably rely on the
confidentiality designations continuing
indefinitely. Moreover, paragraph 20 of the
3

coupled with the fact that appellants never
were required to show good cause mandated
by Rule 26(c), amounts to the type of
extraordinary circumstances contemplated
by our prior decisions.”).

Protective
Order
is
titled
“MODIFICATION”
and
specifically
provides that “[a]ny party may at any time
make a motion requesting that the Court
modify this Order to provide additional or
different protection.”
(Protective Order
¶ 20.) Thus, the express language of the
Protective Order notifies the parties of the
potential modification of the Protective
Order, and therefore, Electrolux could not
reasonably rely on the Protective Order’s
indefinite continuation.

Here, the parties filed their Stipulated
Protective Order on June 14, 2010. On June
16, 2010, Magistrate Judge William D. Wall
“So Ordered” the Stipulated Protective
Order. Magistrate Judge Wall did not
determine whether or not there was good
cause. Accordingly, “[i]n the absence of the
requisite good cause showing, it cannot be
presumed that every piece of discovery filed
under the Order is actually worthy of such a
high level of protection.” See In re EPDM,
255 F.R.D. at 322. Thus, it is not reasonable
for Electrolux to contend that it relied on the
Protective Order never being modified. In
addition, as noted infra, extraordinary
circumstances exist to modify the Protective
Order.

Third, the level of inquiry taken by the
Court before granting the Order supports
plaintiff’s position that the Order should be
modified and that defendant could not have
reasonably relied on the continuation of the
confidential designations. “A protective
order granted on the basis of a stipulation by
the parties carries less weight than a
protective order granted after a hearing to
show good cause.” In re EPDM, 255 F.R.D.
at 321. Moreover, as discussed supra, some
courts in this Circuit have found that, in
addition to there being a lack of reliance on
the protective order, there are “extraordinary
circumstances” when defendants were never
required to show good cause before sealing
documents or ordering a stipulated
protective order. See Fournier, 242 F. Supp.
2d at 341 (“Defendants were never required
to show good cause for sealing the various
documents. This is the same kind of
deference and pervasive protection without
Court review that the Second Circuit found
to constitute ‘extraordinary circumstances’
justifying the unsealing of documents.”); see
also In re “Agent Orange” Prod. Liab.
Litig., 821 F.2d 139, 147-148 (2d Cir. 1987),
superseded in part by statute on other
grounds (“Under the February 6, 1981 order,
appellants needed only to designate
discovery materials as confidential to protect
them . . . We conclude that the exceptionally
pervasive protection granted appellants . . . ,

Furthermore, the nature of the reliance
on the Order does not weigh in favor of
applying
the
presumption
against
modification. “[W]here the parties have not
given up any rights and indeed would have
been compelled to produce the discovery
materials even in the absence of a protective
order, the presumption against modification
is not as strong.” In re EPDM, 255 F.R.D.
at 323 (emphasis in original). In this case,
Electrolux does not argue that it would not
be required to produce the documents in
question in each related litigation.
Moreover, in this Court’s Memorandum and
Opinion denying summary judgment, the
Court notes some of the similar discovery
issues that are common among these other
related litigations. See Charter Oak, 2012
WL 321765, at *6 n.5. Thus, there is no
indication that the documents in question
would not be subject to a motion to compel
in either the currently pending matters or in
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discovery in one case are to be used in that
case only.”).

future cases that are similar to the case at
bar. Thus, Electrolux cannot rely on the
Protective Order as a means of protecting
discovery that would otherwise be
discoverable in the related actions.

In this case, there is a compelling and
extraordinary need to share these common
discovery materials with counsel for the
same plaintiff in other related litigations
against Electrolux, especially in the absence
of any discernible prejudice to Electrolux. If
the Protective Order is not modified,
plaintiff will be forced to litigate the exact
same issue in each and every case. As
plaintiff correctly notes, “[t]o force Plaintiff
to re-litigate disputes already won would not
be in the interest of judicial efficiency as the
same outcome (i.e. an order instructing
Electrolux to produce the discoverable
information) would ultimately be reached in
each similar case between these parties.”
(Pl.’s Reply at 6.) The Court agrees that this
would result in an enormous waste of time
and resources for the parties and the court.
Moreover, because the plaintiff in this action
and any related action would be bound by
the Protective Order, there will not be public
dissemination, which is what the Protective
Order in this case was designed to prevent.
Thus, there is no prejudice to Electrolux if
the modification is made.

Moreover, plaintiff has demonstrated a
compelling need to modify the Protective
Order. As a threshold matter, the Court
notes that allowing the sharing of discovery
among related cases is an efficient and
effective means of avoiding duplicative and
costly discovery, as well as avoiding
unnecessary delay in the adjudication of
cases. See, e.g., Idar v. Cooper Tire &
Rubber Co., No. C-10-217, 2011 WL
688871, at *3 (S.D. Tex. Feb. 17, 2011)
(“[F]ederal courts have ‘overwhelmingly
embraced’ this practice to streamline
discovery and promote access to court
proceedings.” (citations omitted)) (collecting
cases). Thus, in product liability cases
involving the same alleged product defect,
courts have frequently permitted the sharing
of discovery among plaintiffs. See, e.g.,
Ward v. Ford Motor Co., 93 F.R.D. 579,
580 (D. Colo. 1982) (“[i]f, as asserted, a
single design defect is the cause of hundreds
of injuries, then the evidentiary facts to
prove it must be identical, or nearly so, in all
the cases. Each plaintiff should not have to
undertake to discover[] anew the basic
evidence that other plaintiffs have
uncovered.”); Parsons v. Gen. Motors
Corp., 85 F.R.D. 724, 726 n.1 (N.D. Ga.
1980) (“The federal rules do not foreclose
collaboration among litigants, and the court
does not consider the possibility that
plaintiff will share the results of discovery
with any other litigant any part of
defendant’s showing of good cause to justify
a protective order.”); Williams v. Johnson &
Johnson, 50 F.R.D. 31, 32 (S.D.N.Y. 1970)
(“[T]here is no merit to the allencompassing contention that the fruits of

Accordingly, the plaintiff’s motion to
modify the Protective Order is granted, and
the Protective Order is modified to permit
the attorneys in this case to share the
documents and testimony obtained through
discovery with the attorneys representing
plaintiff, its parent or subsidiaries, in
pending or future actions against the
defendant, which arise under similar facts
and circumstances – namely, a dryer fire in
which it is alleged that lint ignited in the
heater pan. Of course, the modification also
will allow Electrolux to share the documents
and testimony with its counsel in the other
litigations.

5

IV.

CONCLUSION

For the reasons set forth above,
Paragraph 4(a) of the Protective Order is
modified so that material designated as
confidential may be disclosed to:
“Attorneys from any law firm that is of
record for any named party (and the named
party’s in-house counsel) to this action or
any other pending or future action between
the parties (including any parent or
subsidiary company) that involves a dryer
fire in which it is alleged that lint ignited in
the heater pan.”
SO ORDERED.
_________________
JOSEPH F. BIANCO
United States District Judge
Dated: August 15, 2012
Central Islip, NY
***
Plaintiff is represented by Jeffery J. White,
Craig A. Raabe, Jeffrey J. White and Laura
A. Torchio of Robinson & Cole LLP, 280
Trumbull Street, Hartford, CT 06103.
Defendant is represented by Cheryl M.
Nicolson, Melissa L. Yemma of Nicholson
Associates LLC, 1300 N. Providence Road,
Suite 6050, Rose Tree Corporate Center,
Media, PA 19063.

6