United States District Court, E.D. Texas, Sherman Division
MEMORANDUM OPINION AND ORDER
L. MAZZANT UNITED STATES DISTRICT JUDGE
before the Court is Defendants' Emergency Motion to
Modify Protective Order (Dkt. #188). After considering the
pleadings and argument of counsel, the Court finds that the
motion should be denied.
October 5, 2016, United States Magistrate Judge Christine A.
Nowak entered a protective order in this case (Dkt. #128).
The protective order permits parties to designate certain
discovery material as “Attorneys' Eyes Only.”
On January 4, 2017, the Court granted Plaintiff's
unopposed motion to clarify that reference to
“Counsel” in the “Attorneys' Eyes
Only” provision of the protective order
“specifically excludes any attorneys (including their
associates, paralegals, legal assistants, secretarial and
clerical employees) who are parties to the case, including
but not limited to Brian Manookian, Brian Cummings, Cummings
Manookian, PLC, Mark Hammervold, and Hammervold PLC.”
April 25, 2017, Defendant Mark Hammervold
(“Hammervold”) appeared in this matter as
associate counsel for himself and Hammervold PLC (Dkt. #179).
On May 2, 2017, Defendants Brian Manookian
(“Manookian”) and Brian Cummings
(“Cummings”) filed an application to appear pro
hac vice in this matter. On May 9, 2017, Defendants filed an
Emergency Motion to Modify Protective Order (Dkt. #188).
Defendants argue that the Court should remove the protective
order's Attorneys' Eyes Only designation because
Plaintiffs abused the designation and Defendants, as counsel
of record in the case, are entitled to fully participate in
their own defense. On May 11, 2017, Plaintiffs filed a
response (Dkt. #193). Plaintiffs respond that highly
sensitive information about themselves and their business
cannot be shared with Defendants because they continue to
harass and threaten Plaintiffs. Plaintiffs also respond that
Defendants could not appear as co-counsel in the case because
doing so would result in hybrid representation.
19, 2017, the Court held a hearing regarding the motion. The
Court orally denied Defendants' motion to modify the
26(c) empowers the court to enter a protective order for good
cause to protect a party from, among other things, revealing
certain commercially sensitive information. Fed.R.Civ.P.
26(c)(1)(G). “The court enjoys broad discretion in
entering and modifying any such order.” Raytheon
Co. v. Indigo Sys. Corp., No. 4:07-CV-109, 2008 WL
4371679, at *2 (E.D. Tex. Sept. 18, 2008). “In deciding
whether to modify a stipulated protective order at the behest
of a party that originally agreed to the order for reasons
related to the private interests of the parties to the
action, the court considers four factors: (1) the nature of
the protective order, (2) the foreseeability, at the time of
issuance of the order, of the modification requested, (3) the
parties' reliance on the order; and most significantly
(4) whether good cause exists for the modification.”
Id. (internal citations and quotations omitted). If
good cause was not shown for the original protective order,
the burden of showing good cause is on the party seeking
continued confidentiality protection. United States v.
Homeward Residential, Inc., No. 4:12-CV-461, 2016 WL
279543, at *4 (E.D. Tex. Jan. 22, 2016) (citing In re
Enron Corp. Sec., Derivative, & ERISA Litig., 2009
WL 3247432, at *2 (S.D. Tex. Sept. 29, 2009)).
protective order at issue is a blanket order that
“allows the parties to designate information as
protected that they, in good faith, deem to be worthy of
heightened secrecy.” Raytheon, 2008 WL 4371679
at *2. Though blanket orders are moderately susceptible to
modification, if the parties stipulated to the protective
order, as in this case, that factor weighs against
Defendants stipulated to the protective order, Defendants
argue that modification is appropriate because it was not
foreseeable that Manookian and Cummings would enter an
appearance in the case. However, the Court denied Manookian
and Cummings's application to appear pro hac vice in the
case. Manookian and Cummings's notice of appearance in
the case thus does not warrant modification of the protective
next factor, the reliance factor, “focuses on the
extent to which the party opposing the modification relied on
the protective order in deciding the manner in which
documents would be produced in discovery.” Id.
at *3. Here, Plaintiffs allege Defendants engaged in a scheme
to defame and defraud Plaintiffs. Plaintiffs also allege that
Manookian and Cummings currently represent other jewelers.
Plaintiffs argue that the protective order is necessary to
prevent Manookian and Cummings from utilizing the
confidential information to defame Plaintiffs and disclosing
confidential information to other jewelers. The reliance
factor thus weighs against modifying the protective order.
Defendants argue Plaintiffs have failed to show good cause
for the protective order. Defendants argue the case does not
involve litigation between competitors. Defendants also argue
Plaintiffs have abused the designation by postponing the
deposition of a third party and designating the deposition as
Attorneys' Eyes Only. Plaintiffs respond that counsel for
the third party designated the deposition Attorneys' Eyes
Only because “Defendants had waged a negative
advertising campaign” against the third party and
counsel for the third party wished to restrict
Defendants' access to his client. Plaintiffs argued that
Defendants have not yet deposed Plaintiffs or their former
employees and Plaintiffs thus had not abused any
Attorneys' Eyes Only designations.
Court finds Plaintiffs established good cause for the
protective order. Plaintiffs allege Defendants may utilize
the confidential information to continue to defame and
defraud Plaintiffs and may disclose confidential information
to other jewelers. Defendants are represented by counsel who
have full access to any Attorneys' Eyes Only documents.
At the hearing, the Court noted that if Plaintiffs or
Defendants believed counsel improperly designated a