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Open Court - Protective Orders' (aka 'Court-imposed Confidentialty Agreements')
QUERY?
Are these orders akin to the 'deemed undertaking' rule?
. Fibrogen, Inc. v. Akebia Therapeutics, Inc.
In Fibrogen, Inc. v. Akebia Therapeutics, Inc. (Fed CA, 2022) the Federal Court of Appeal considered pre-trial 'protective orders and confidentiality agreements' used in intellectual property litigation as an exception to the 'open court' principle:[8] I note, parenthetically, that five months prior to the execution of the Agreement in August 2020, this Court settled the question whether the Sierra Club standard (Sierra Club of Canada v. Canada (Minister of Finance), 2002 SCC 41, [2002] 2 S.C.R. 522 [Sierra Club]) applied to protective orders (essentially court imposed confidentiality agreements), and confidentiality agreements such as the one under consideration. In February 2020, in Canadian National Railway Company v. BNSF Railway Company, 2020 FCA 45, [2020] 3 F.C.R. 124 [Canadian National], this Court held that the Sierra Club standard did not apply to protective orders.
[9] Protective orders and confidentiality agreements regulate how documents and information are to be exchanged between the parties during the pre-trial proceedings, and, as such, do not engage the open court principle and the Sierra Club standard. Sealing orders, in contrast, remove from the public record the materials that would otherwise be made public. In Canadian National, this Court said at paragraph 24 of its reasons:It bears emphasis that the underlying interests in seeking protective orders and confidentiality orders are significantly different. This was acknowledged by the Motions Judge in the present instance when he observed that “a protective order has no deleterious effects on the principle of open and public courts”, unlike confidentiality orders. Yet, the Motions Judge deemed that “a request for a protective order should be considered using the same criteria as set out in paragraphs 53 and following of Sierra Club for a confidentiality order” (Motions Judge Reasons for Order at para. 19). This is inconsistent given that the criteria in Sierra Club are meant to address interests, in particular the open court principle, which are simply not in play in the context of protective orders at the pre-trial discovery stage. This was made clear by the Supreme Court in Juman v. Doucette, 2008 SCC 8, [2008] 1 S.C.R. 157, where the Court stated (at para. 21):[…] Pre-trial discovery does not take place in open court. The vast majority of civil cases never go to trial. Documents are inspected or exchanged by counsel at a place of their own choosing. In general, oral discovery is not conducted in front of a judge. The only point at which the “open court” principle is engaged is when, if at all, the case goes to trial and the discovered party’s documents or answers from the discovery transcripts are introduced as part of the case at trial. [10] Protective orders and confidentiality agreements are integral to how litigation proceeds in the Federal Court. These agreements, often reached with little or no intervention of the Court, ensure that pre-trial proceedings are conducted in an efficient manner and on a common understanding between the parties as to how documents will be exchanged in a manner that does not put legitimate business interests at risk. They ensure that discoveries are timely and progress in a predictable manner, which is particularly critical given the mandatory time frames within which lengthy and complicated intellectual property trials must be completed in the Federal Court. Protective orders and confidentiality agreements remain subject to the supervision of the Court, particularly by case management judges who may be called on from time to time to resolve differences of opinion as to their terms or to adjust the time frames.
[11] The jurisdiction of the Court to deal with confidentiality agreements as well as any post-trial issues with respect to documents does not depend on the agreement of the parties. This Court, as well as the Federal Court, has an implicit jurisdiction to deal with all documents that are engaged in the proceedings before it both during and after the conclusion of litigation (Canadian Broadcasting Corp. v. Manitoba, 2021 SCC 33, 461 D.L.R. (4th) 635 at paras. 36, 62 [CBC]).
[12] The provisions in the Agreement whereby the parties attorn to the jurisdiction of the Federal Court to supervise its implementation, while understandably inserted out of an abundance of caution, were unnecessary. The Court will, if necessary, intervene and impose orders as required as part of its implied jurisdiction to supervise proceedings before it and after the litigation ends (CBC; Dugré v. Canada (Attorney General), 2021 FCA 8, [2021] F.C.J. No. 50 (QL); Hershkovitz v. Canada (Attorney General), 2021 FCA 38, 2021 CarswellNat 443).
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