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How Much Protection Does My Protective Order Provide?

A recent brouhaha about the disclosure of Facebook’s confidential material to the UK’s House of Commons shines a spotlight on the tenuous protection granted to materials produced in discovery. The materials were subject to a protective order and multiple sealing orders issued by a state judge in a promissory estoppel case being litigated in California. Despite those orders, the materials are now in the hands of Damian Collins, a House of Commons member who chairs Parliament’s Digital, Culture, Media, and Sports Committee (“DCMS”). Further complicating matters, Mr. Collins has threatened to release the materials publicly.

The dispute started with Facebook producing the confidential materials pursuant to a standard protective order in a lawsuit brought by SixFourThree, LLC in San Mateo County Superior Court. Despite the requirements in the protective order, SixFourThree’s founder and representative, Theodore Kramer, had access via a Dropbox account to materials Facebook had designated as “highly confidential.”

While Mr. Kramer was traveling in the UK on business, he met with a journalist who connected him to Mr. Collins. In his role as chairperson of the DCMS, Mr. Collins issued an “Order to Produce Documents,” which required Mr. Kramer to turn over the materials Facebook had produced. After learning about the Order, the San Mateo Court ordered Mr. Kramer not to produce the documents. Mr. Kramer, purportedly under threat of imprisonment and fines for contempt of Parliament, provided the DCMS with a USB thumb drive of Facebook’s confidential and highly confidential materials. Mr. Kramer then deleted the files in the Dropbox on advice of counsel, thereby destroying evidence of what he had provided. On Facebook’s request, the San Mateo Court has issued an order requiring Mr. Kramer and his counsel to appear on November 30, 2018 to discuss the matter.

Facebook’s experience is a useful reminder that protective orders and sealing orders have limits; they are only as good as the counsel and parties to whom they apply and the methods they use to hold them. Parties who have to produce confidential or highly confidential materials should consider adding requirements about where their materials will be stored as part of their protective order negotiations. They should also consider inquiring whether opposing counsel or their clients engage in international travel and potentially adding limits on the access of materials when counsel or parties are abroad. And, counsel and parties who have access to their own or opposing parties’ confidential information likewise should consider limiting their access to that information while traveling abroad. Or they too could end up explaining themselves to a court.

Visit our website to learn more about V&E’s Government Investigations & White Collar Criminal Defense practice. For more information, please contact Vinson & Elkins lawyer Jennifer Freel.

This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.