7th Cir. Confirms Protections for Sealing Parties’ Confidential Documents

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A common concern for business litigants is protecting legitimately confidential matter contained in documents produced during discovery from dissemination to non-parties.  The Supreme Court’s decision in Seattle Times Co. v. Rhinehart, 47 U.S. 20 (1984), confirmed that discovery material can be shielded from the public eye—commonly through a protective order—but once that material is filed with the court, any document that affects the disposition of litigation is presumptively open to public view.  Some parties, pointing to Fed. R. Civ. P. Rule 5(d), have suggested that any document filed with a court “has been used in [a court] proceeding,” and  has possibly influenced the judicial decision, so must presumptively be made public.  That interpretation leaves the producing party (usually the business entity) in a vulnerable position, unable to protect from disclosure confidential documents produced to the opposing party, regardless of whether they are relevant to the issue at hand.

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7th Cir. Leaves Distressed-Asset Investor with No Remedy, or Exactly What it Bargained for

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It’s rare that a party to a contract can breach it but not be liable for a remedy. Yet that’s precisely what happened last week in Southern Financial Group, LLC v. McFarland State Bank, No. 13-3378 (7th Cir. Aug. 15, 2014), a Wisconsin-law decision from the Seventh Circuit (written by Chief Judge Wood) that has much in common with a case that we wrote about yesterday involving the Seventh Circuit’s determination that Wisconsin law has a heightened discovery-rule standard for corporate plaintiffs pursuing fraud claims.

Only Southern Financial didn’t involve a tort or a statute of limitations. It concerned the right of two sophisticated parties to bargain, to reach an agreement, and, as part of that agreement, to limit (entirely, as it turned out) the remedies available in the event of a breach. The stories’ moral is the same, however: Courts treat sophisticated parties (often corporations) differently, whether that means holding them to a higher standard under a discovery rule or binding them to their contract’s terms, even when that means that there is no remedy for a breach.

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Known Unknown: 7th Cir. Uses Heightened Discovery Rule for Wisconsin Businesses

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In a case decided last Friday, KDC Foods v. Gray, Plant, Mooty, Mooty & Bennett, P.A., No. 13-3678 (7th Cir. Aug. 15, 2014), the Seventh Circuit warned companies not to expect much leeway from statutes of limitation under Wisconsin law.

The court used a heightened discovery-rule standard—one that asks ”when a reasonable corporate actor would have had enough knowledge”—that accounts for the often greater sophistication of corporate litigants.

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7th Circuit Rejects Public-Disclosure Bar in Qui Tam Case

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A cardinal rule of a qui tam action brought under the False Claims Act is that the relator must be the information’s original source.

In United States ex rel. Heath v. Wisconsin Bell, Inc., No. 12-3383 (7th Cir. July 28, 2014), the Seventh Circuit grappled with this bar on the use of publicly disclosed information, refusing to apply it in a case involving the amounts Wisconsin Bell charged to Wisconsin school districts for phone service.  (The  Affordable Care Act modified this rule somewhat, but the change was not retroactive, so the court applied the law that was in effect before the Affordable Care Act became law.)

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Cherry-Picking: 7th Cir. Criticizes Lawyers' Summary-Judgment Practice

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Two weeks ago, in an order given wide publicity nationally, federal District Judge Mark Bennett of the Northern District of Iowa issued sanctions in Security National Bank v. Abbott Laboratories, addressing what Judge Bennett perceived as abusive discovery conduct in a case over which he had presided. There were clearly lessons to learn from that order, including the importance of knowing and adhering to the expectations of the judge before whom you are practicing.

Last week the United States Court of Appeals for the Seventh Circuit issued a decision in Malin v. Hospira, Inc., No. 13-2433 (7th Cir. Aug. 7, 2014), that contains another important lesson for litigators.

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