There And Back Again - Protective Agreements In The Federal Court

A recent decision of the Federal Court has once again shifted the approach a party must take to keep their documents and information confidential during litigation.

In Canadian National Railway Company v. BNSF Railway Company, 2019 FC 281 both parties sought a protective order defining the various restrictions on their confidential documents that were to be disclosed to the other side. Justice Locke dismissed the motion on the basis that it was unnecessary; the parties could instead enter into a protective agreement. As there was no disagreement between parties on how to handle the confidential information, the Court's involvement was deemed unnecessary.

This case is yet another shift in the Federal Court's approach to the protection of confidential information disclosed during litigation. It appears that the Court's recent preference towards Protective Agreements, rather than Protective Orders issued by the Court on consent, may be here to stay.

Types of Protection in the Federal Court

As a starting point, it is helpful to understand the different terms used by the Federal Court when it discusses the protection of a party's confidential information. There are three main categories of Orders/Agreements at issue: i) Protective Orders, ii) Protective Agreements, and iii) Confidentiality Orders.

Protective Orders

Protective Orders are an Order of the Court setting out how the documents exchanged between parties shall be handled. They typically include terms setting out: the number of individuals to whom documents can be disclosed; how documents should be marked to indicate confidentiality; how disputes should be raised over confidentiality; and in some cases provide for enhanced protection of certain documents by way of a Counsel's Eyes Only provision.

Protective Orders were previously very common in the Federal Court, and typically issued on consent of the parties. Parties would negotiate the terms they believed were warranted, the Court would review for any major concerns, and then an Order would issue governing the exchange of documents between parties.

Protective Agreements

A Protective Order is, as expected, an official Order of the Court. A Protective Agreement, meanwhile, is a written agreement between the parties which typically sets out all of the same elements as a Protective Order. As a Protective Agreement does not need to be issued by the Court, the Court does not receive a copy and would otherwise be unaware of its terms.

Both Protective Orders and Protective Agreements only address the exchange of material between parties. There is no guarantee that the designation of a document as "confidential" under a Protective Order or Agreement will permit it to be filed confidentially with the Court.

Confidentiality Orders

Confidentiality Orders differ from Protective Orders and Agreements in that they determine how a party may file its confidential materials with the Court. When filing confidential documents with the Court, a party can seek to file it "under seal" (that is, in a sealed envelope not available to the public) which requires the Court to first issue a Confidentiality Order. To issue a Confidentiality Order the Court must be satisfied that: i) the information is truly confidential, ii) that it would be detrimental to the parties if publically disclosed, and iii) that this detriment outweighs the principle of public access to the Court.

This can be a difficult bar to meet, as the Court often restricts the information covered by a Confidentiality Order. Even where a Confidentiality Order issues, the Court will require a party to file a public version of their materials with the limited confidential information redacted.

Finally, though not a distinct category, in years past the Court had issued...