We recently discussed the restricted use of commercially sensitive information in litigation in this article which considered Courtney v Ocm Emru Debtco DAC & Another IEHC 160. In that case, the Court limited inspection of certain information to the plaintiff and her legal advisors and prevented the plaintiff from mentioning the information in open court. The approach taken by the Court in Courtney was akin to a confidentiality ring which was imposed by the High Court in Goode Concrete v CRH PLC & Others IEHC 534. The decision in Goode Concrete was appealed by the plaintiff and recently the Court of Appeal upheld the High Court’s decision. In this article we look at the approach of the Court of Appeal in reaching its decision to impose a confidentiality ring to protect commercially sensitive information.
Legal Loss v’s Commercial Win
In the High Court, the discovery order was subject to a confidentiality ring which excluded the principal of the plaintiff company from access to documents which contained commercially sensitive information about its competitors. The documentation in question contained tender information, pricing strategies and cost bases. In ordering a confidentiality ring, the High Court limited access to the documentation to the legal advisors of the plaintiff and its independent expert advisors. In making its decision, the High Court had regard to the fact that these were competition law proceedings and that it needed to avoid creating a situation where a plaintiff would walk away with a “legal loss but a commercial win” having gained access to valuable information and acquiring a competitive advantage.
Court of Appeal Confirms
In upholding the decision, the Court of Appeal was satisfied that the order of a confidentiality ring was appropriate and required in order to protect the legitimate interests of the defendants in the protection of their commercially sensitive information. The Court acknowledged the well-established practice of confidentiality rings in competition law cases and in the Competition Appeals Tribunal in the UK.
The Court considered that the offer of an undertaking from principal parties behind the plaintiff not to use the information for any other purpose was “of little practical use” as the defendants would not have any way of policing whether or not the information would be used to a commercial advantage.
The Court also dismissed the plaintiff’s argument that excluding the plaintiff from access to the data prevented it from giving instructions to its legal team and experts. The Court did not accept that plaintiff needed access to the materials and noted that this was the role of the expert.
When considering whether a confidentiality ring should be sought to protect your confidential information, the following questions should be raised:
- Is the information commercially sensitive?
- Do you have a legitimate interest in protecting the confidential information?
- Would redaction be sufficient in the alternative?
- Would an undertaking from your opponent suffice in the alternative?
This is a welcome decision and highlights that the Irish Courts are willing to consider the use of confidentiality rings in certain circumstances in order to protect commercially sensitive information.
Contributed by Adele Hall