A wave of cases alleging liability for the health and economic effects of the novel coronavirus is already sweeping into courts across the country.

Members of the American Federation of Government Employees are suing the federal government in the U.S. Court of Federal Claims. An international cruise line faces a proposed class action alleging security law violations.

A common theme will appear in every large-scale litigation on this subject—defendants' desire to conceal any embarrassing or damaging documents from public view and dissemination.

In many current and prospective cases, a central inquiry is the proverbial "who knew what, and when" as to the risks posed by the spread of Covid-19 disease. With members of Congress under investigation for their personal stock sales after receiving briefings on the danger posed by the coronavirus, it may come to light that people outside the government were also aware of the risks, yet may not have fully disclosed them to their customers or others.

The desire to limit access to and dissemination of such documents will run into direct conflict with a black-letter legal principle: the public's right of access to judicial documents and proceedings. In recent years, the proliferation of sealed filings across the federal court system has undermined this central tenet of the judicial system.

Although the public's right of access is black-letter law in every federal circuit in the country, in nearly every complex litigation in the country, parties treat this legal principle as simply an aspirational goal, rather than settled law. Courts consistently seal material that does not approach the legal standard for representing a trade secret, or similar protectable material. In doing so, judges decide substantive case issues (motions to dismiss, for class certification and for summary judgment) based upon evidence that the public cannot see.

While there are cases where true trade secrets require sealed treatment regardless of the issue that the court is deciding, those situations are the exception rather than the rule. It is highly unlikely, for example, that a defendant's advance warning or knowledge of Covid-19 risks qualifies as a trade secret or protectable material.

As the public's right to information on this subject will be critical in the coming months, practitioners and courts will need to more critically analyze proposed protective orders and sealing requests whose primary purpose often is to avoid public embarrassment or criticism, not protect trade secrets. The fundamental right of public access—and resultant public confidence in the judicial system—should not fall victim to overzealous sealing efforts.

Across the federal circuits, the public's right of access to judicial records and proceedings is a long-standing principle. See, e.g., Courthouse News Services v. Planet, 947 F.3d 581, 589 (9th Cir. 2020) ("The presumption of access to judicial proceedings flows from an unbroken, uncontradicted history rooted in the common law notion that justice must satisfy the appearance of justice."); Spinelli v. National Football League, 903 F.3d 185, 193 (2d Cir. 2018) ("We see no justification for sealing those materials that would outweigh the public's right of access to judicial documents necessary to understand the basis for court rulings, and accordingly, the portions of the C.J.A. referenced in this opinion are, to that extent, unsealed."); Courthouse News Services v. Brown, 908 F.3d 1063, 1069 (7th Cir. 2018) ("the courts of this country recognize a general right to inspect and copy public records and documents, including judicial records and documents"); Leucadia v. Applied Extrusion Technologies, 998 F.2d 157, 161 (3d Cir. 1993) ("The public's exercise of its common law access right in civil cases promotes public confidence in the judicial system … As with other branches of government, the bright light cast upon the judicial process by public observation diminishes the possibilities for injustice, incompetence, perjury, and fraud. Furthermore, the very openness of the process should provide the public with a more complete understanding of the judicial system and a better perception of its fairness."); Chicago Tribune v. Bridgestone/Firestone, 263 F.3d 1304, 1311 (11th Cir. 2001) ("The common-law right of access to judicial proceedings, an essential component of our system of justice, is instrumental in securing the integrity of the process.").

In civil litigation generally, deviation from this settled precedent often begins with the parties' crafting of agreed protective orders to govern discovery. Fed. R. Civ. P. 26 provides a framework for what types of material should be subject to sealed treatment, stating a court may require "that a trade secret or other confidential research, development, or commercial information not be revealed or be revealed only in a specified way."

Many protective orders, drafted by the parties themselves as opposed to the court, grant protections that far exceed the parameters of Rule 26 or the governing case law. For example, proposed protective orders often contain multiple levels of confidentiality designations, ranging from a generic "confidential" category to an "attorney's eyes only" designation. Some proposed orders will even go so far as to state that any document marked with a confidentiality designation of any type is entitled to automatic sealed treatment in the event a party files it with the court.

Moreover, the protective orders typically set extremely loose standards for parties who produce and designate documents with a confidentiality designation, often requiring only a "good faith" belief that the document in question is entitled to confidential treatment.

Courts frequently simply adopt these proposed protective orders without scrutinizing them because they are submitted in an agreed fashion. Once a court enters such an order, the dominoes begin to fall that lead to a deviation from the settled precedent regarding the public's right of access.

Courts and litigants must avoid this outcome in high-profile Covid-19 litigation where the public's interest in the proceeding is high.

For example, many parties to litigation will engage in wholesale, "blanket" confidentiality designations of their document production that mark as confidential not only actual trade secrets and commercially sensitive information, but routine business correspondence. There are occasions when courts intervene to correct this practice, but that only occurs when an opposing party raises the matter. See PPD Enterprises v. Stryker, No. CV H-16-0507, 2017 WL 3263469, at *1 (S.D. Tex. June 27, 2017) ("defendants' blanket confidentiality designation for all 64,000 documents they have produced is both improper and counterproductive, because it generates needless, costly satellite disputes which threaten the orderly and timely preparation of this case for trial.").

When blanket-type confidentiality designations exist, the typical result is a request by the producing party that the court seal any "confidential" document that it or its opponent seeks to file with the court. With an agreed protective order in place, the producing party typically files a very short motion, accompanied by an often vague declaration, citing to the protective order and providing a conclusory statement that the designated material merits sealed treatment.

Like the protective order itself, when a party submits such a motion in an agreed fashion, the court often enters a seal order as matter of course.  Exceptions exist, but they are not common. See BASF v. SNF Holding, No. 4:17-CV-251, 2019 WL 3554699, at *5 (S.D. Ga. Aug. 5, 2019) ("Plaintiff has offered only blanket assertions of confidentiality, and it does not bother to explain, with any degree of specificity, why sealing the content related to the many redactions in its brief is warranted.") (denying motion to seal).

While this process is unobjectionable in the context of routine discovery motions, it is flatly contrary to established precedent in the context of substantive, case-dispositive motions. See Romero v. Drummond Co., 480 F.3d 1234, 1245 (11th Cir. 2007) ("Material filed in connection with any substantive pretrial motion, unrelated to discovery, is subject to the common law right of access.").

Trade secrets are entitled to protection and sealed treatment, even in the context of dispositive motions, but sealing actions have extended the definition of a trade secret far beyond what is actually supported in the case law. Florida law, for example, defines a trade secret as information that "derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use" and that is "the subject of efforts that are reasonable under the circumstances to maintain its secrecy."

Much of what is presented to courts as "trade secrets" justifying sealed treatment is basic internal business communication, none of which has the "independent economic value" an actual trade secret possesses. See PPD Enterprises, 2017 WL 3263469 at *1 ("the court agrees that trade secrets should be protected. But no rational person could regard every single company email, regardless how vacuous or mundane, as a legitimate trade secret … After all, defendants business is the manufacture and supply of orthopedic medical equipment; they do not traffic in state secrets or classified national security information.").

In Covid-19 litigation, it is likely that emails and related internal business correspondence will be highly relevant to determining whether any given defendant failed to warn consumers of a known risk. Any defendant in possession of such documents will make every effort to seal them, and it will be up to vigilant litigants and courts across this country to only conceal from the public true trade secrets, thereby preserving the long-standing right of access to judicial proceedings.

Alec H. Schultz focuses on commercial litigation at León Cosgrove LLP.