Oxxford Info. Tech., Ltd. v. Novantas LLC.
Oxxford Info. Tech., Ltd. v. Novantas LLC.
78 A.D.3d 499 (N.Y. App. Div. 2010)
November 16, 2010
Summary
The Supreme Court of New York County denied plaintiff's motion to modify a so-ordered confidentiality stipulation, requiring that the ESI be returned to the party that produced it or destroyed after the termination of litigation. The court found that the cost of deleting the information from the tapes did not outweigh defendants' bargained-for interest in the post-litigation destruction of its business information.
OXXFORD INFORMATION TECHNOLOGY, LTD., Appellant,
v.
NOVANTAS LLC et al., Respondents. (And a Counterclaim Action.)
v.
NOVANTAS LLC et al., Respondents. (And a Counterclaim Action.)
3595, 602481/07
Supreme Court, Appellate Division, First Department, New York
November 16, 2010
Order, Supreme Court, New York County (Barbara R. Kapnick, J.), entered March 5, 2010
Counsel
Paul, Hastings, Janofsky & Walker LLP, New York (Daniel B. Goldman of counsel), for Appellant.Wolf Haldenstein Adler Freeman & Herz LLP, New York (Eric B. Levine of counsel), for Respondents.
Panel members:
Friedman, David,
Sweeny Jr., John W.,
Catterson, James M.,
Renwick, Dianne T.
Opinion
*499 Order, Supreme Court, New York County (Barbara R. Kapnick, J.), entered March 5, 2010, which denied plaintiff's motion to modify a so-ordered confidentiality stipulation under which the parties agreed that business information exchanged in discovery would be returned to the party that produced it or destroyed after the termination of litigation (the “ Confidentiality Order”), unanimously affirmed, with costs.
After plaintiff demanded that defendants produce certain confidential business information, the parties negotiated and stipulated to the Confidentiality Order, and defendants produced much information **78 in reliance thereon. The action eventually settled, whereupon plaintiff's counsel discovered that they had inadvertently backed up defendants' information onto numerous back-up tapes to their law firm's computer system. Claiming it would be too costly to delete the information from the tapes, plaintiff moved to modify the Confidentiality Order to permit its counsel to retain the information on the tapes subject to proposed safeguards designed to protect the confidentiality of the information.
We find that such cost does not outweigh defendants' bargained-for interest in the post-litigation destruction of its business information in outsiders' hands, or otherwise warrant the proposed modification (see Bayer AG & Miles, Inc. v. Barr Labs., Inc., 162 F.R.D. 456, 464 [S.D.N.Y.1995]; see also Rice v. Rice, 288 A.D.2d 112, 112, 733 N.Y.S.2d 393 [2001], lv. dismissed *500 97 N.Y.2d 725, 740 N.Y.S.2d 696, 767 N.E.2d 153 [2002], citing Bayer AG at 462–463). Plaintiff voluntarily consented to the Confidentiality Order (see Bayer AG at 465–466), and its counsel, who have demonstrated experience in and sophisticated knowledge of electronic discovery matters, should have foreseen the problem and addressed it when the Confidentiality Order was being negotiated (see id. at 466–467). Defendants relied on the Confidentiality Order in affording access to their core business secrets, and the proposed safeguards against access by third parties amount to something considerably less than a guarantee.