United States: Your Court Documents Filed Under Seal: Will They Stay Confidential?

Preserving the confidentiality of your client's sensitive documents is a serious issue, whether the client is an individual concerned about personal disclosures or a large corporation protecting valuable proprietary information.

Consider a common scenario: in response to your client's concerns, you acquired a protective order and filed documents under seal in recent litigation. You just obtained a favorable result, and the case is closed. You might feel comfortable that the information in the sealed documents will remain protected as long as you have a blanket protective order that remains in effect after the case's final disposition. Or you may not think much about those documents at all after the final order is entered.

Unfortunately, this is no time for complacency. If those documents were filed in the northern district of Illinois, they may already be opened and in the public court file for all to see. Although it may come as a shock, the northern district is busy right now opening hundreds of sealed court documents and exposing them in the public record. And other state and federal courts in Illinois and around the country could adopt rules that could produce similar results.

Consider the exposure to malpractice claims and impact on client relations - in addition to considerable potential embarrassment to both you and your client - of leaving sensitive documents in the custody of a court that has both a local rule and stated policy of opening documents filed under seal, just weeks after the case ends. Documents containing your client's privileged information, trade secrets, juvenile records, medical and psychiatric records, tax, financial and investment information and even grand jury testimony could be released to the public - to your client's potential employers, competitors, and opponents in litigation.

Consider further that the future is likely to bring increased access to public documents, including those in court files. As courts begin to accept electronic filings or digitally scan filed documents, Internet publication and access to any of your client's documents contained in public court files may not be far in the future.

Finally, consider the permanence of disclosure. Once a document has been found in a public court file, it is probably too late to restore its confidentiality. This is illustrated by the recent New York federal district court decision in Salomon Smith Barney, Inc. v HBO & Co.¹

In Salomon Smith Barney, the court entered a consensual protective order, under which documents to be treated as confidential could be designated as such. The plaintiff submitted a letter to the court with a binder of exhibits, both stamped "highly confidential subject to protective order."² The binder documents had been produced by Bear, Stearns & Co., Inc. pursuant to subpoena, and related to Bear, Stearns' representation of the defendants as a financial advisor for their proposed merger. The court opinion acknowledges that "the letter and the exhibits both found their way into the Court's public file."³

After settlement of the case, a plaintiff in another case against the defendants' successor-in-interest found the exhibit binder in the public file and intervened, seeking removal of the documents' confidential designation. Bear, Stearns also intervened, seeking to remove the documents from the public file and preserve their confidentiality.⁴ In the end, the court found that Bear, Stearns failed to establish sufficient cause for the documents' continued confidential treatment, and opined that Bear, Stearns' "real concern is the possibility of public embarrassment."⁵ The court ruled that the documents should remain in the public record.⁶

The documents at issue in the Salomon Smith Barney case apparently were not filed according to special procedures designed to protect restricted documents. However, the case illustrates the danger of entrusting confidentiality entirely to the courts, and the need to carefully consider at every step of litigation the risks of court-file disclosure of confidential documents.

It also illustrates that just as there are important reasons for keeping your client's confidential information out of the public domain, the potential consequences of public disclosure are severe. Disclosure of information that your client entrusted to you for purposes of litigation, with the understanding that it remain confidential, can easily find its way into enemy hands. It could provide evidence to a litigation opponent (as in Salomon Smith Barney), expose your client to additional litigation or prosecution, destroy your client's business and employment opportunities or even your client's personal life – all of which could come with possibly disastrous results to your legal practice.

Disclosure in the northern district, and possibly other courts, cannot be avoided solely by taking the usual precautions of acquiring a protective order and filing documents under seal pursuant to Local Rule 5.8. Even a blanket protective order that remains in effect after final disposition will not avoid this hazard, which begins at final disposition.

The end of litigation – a time when the fate of those sealed documents is perhaps furthest from your mind – is when you have to act to protect your client's sealed and restricted documents. The reason for this in the northern district of Illinois is Local Rule 26.2(e).

Local Rule 26.2 governs restricted documents and their disposition. Subsection (e) contains the operative language. It requires the court clerk to maintain and enforce restrictions on filed documents, including a document's seal, for only 63 days following final disposition of a case, including appeals. Unless a party moves the court within those 63 days to turn over restricted and sealed documents, "at the end of the 63 day period the clerk shall place the restricted documents in the public file." Upon a motion for return of the restricted documents, the court may issue an order to have the document returned, destroyed, or retained as a restricted document for a period not to exceed 20 years and thereafter destroyed.⁷

The rule contains some mysteries. Although subsection (a) lists four terms and defines them "[a]s used in this rule," the remainder of the rule only refers to one of those terms. The definitions of "sealed document," "document awaiting expunction," and "protective order" appear extraneous, because the rest of the rule discusses only "restricted documents."⁸

However, the definition of "sealed document" is pertinent: "'Sealed document' means a restricted document which the court has directed be maintained within a sealed enclosure such that access to the document requires breaking the seal of the enclosure."⁹ Because sealed documents comprise a type of restricted document, the 63-day rule for restricted documents applies to documents filed under seal.¹⁰

Grand jury documents appear to be equally at risk. Former General Rule 10(G) and 10(H) created strong protection for grand jury transcripts and other grand jury documents, and required destruction as the only method of disposal. However, the current Local Criminal Rule 6.2 sweeps "grand jury subpoenas, transcripts of testimony, the clerk's docket of grand jury proceedings, motions and orders relating to grand jury subpoenas, true bills, and no bills" into the category of "restricted documents," making them arguably subject to unsealing under Local Rule 26.2(e).¹¹

Significantly, Local Rule 26.2 does not require that any type of notice be given to parties or their counsel before unsealing documents. This is especially likely to trap the unwary because the northern district does give notice before disposing of less sensitive documents. For example, Local Rule 79.1 requires that if a party does not remove exhibits deposited with the court, the party "shall be notified by the clerk to remove the exhibits."¹²

This is not the only way that the northern district accords public-record exhibits more protection than sealed confidential documents; exhibits also have a shelf life nearly twice that of sealed and restricted documents at the clerk's office. Sealed documents can be made public just 63 days after final disposition, whereas exhibits are retained for 90 days after final decision (or less if appeal is taken). After the 90 days and notice from the clerk, the party is allowed an additional 30 days to collect the exhibits before the clerk sells or otherwise disposes of them.¹³

The result of Local Rule 26.2(e) is that less than three months after filing a document under seal in the northern district of Illinois, it could be laid open to the public without notice to you or your client.

Although the 63-day rule became effective December 30, 1996, as General Rule 10(I), it was not implemented until the court issued a general order on June 15, 1999. The general order not only implemented the disclosure of restricted and sealed documents filed after the rule's effective date; it also applied the rule retroactively.

The general order attached a list of hundreds of case files containing restricted and sealed documents filed before General Rule 10(I) became effective in late 1996. It requires that the list be published with a notice that documents in these cases are to be opened and placed in the public file if the court is not petitioned to prevent disclosure. The list of cases was placed on the northern district of Illinois' Web site, although it has since been removed (a copy of the list can be requested from the northern district court clerk's office).

A brief review of the list reveals anonymous litigants – John Doe cases and case captions referring to litigants by their initials. There can be no doubt that the northern district's policy will reveal sensitive personal information regarding these parties, not to mention the trade secrets and other confidential information of countless commercial litigants.

Now, the northern district's docketing department is working through this list of old cases, with only one criterion in mind: if there is no specific minute order entered pursuant to Local Rule 26.2(e) requiring the sealed and restricted documents to be destroyed, returned to counsel, or kept sealed, the seals are broken and the documents go to the public case file. This means that 20 years after a case is closed, and long forgotten by the client and counsel, sealed documents could be disclosed to the public with nothing more than notice by publication.

Although federal courts, including the U.S. Circuit Court of Appeals for the Seventh Circuit, have traditionally protected documents filed under seal from disclosure after termination of a case,¹⁴ the northern district of Illinois is currently removing hundreds of such sealed documents from its vault, opening them without regard for their contents, and placing them in public files.

A brief search of local rules and general orders, and some telephone calls to the clerk's offices of several other federal district courts with substantial civil dockets, revealed no policies that would result in wholesale disclosure of sealed documents. However, it must be recognized that other courts, state or federal, may have similar rules and policies, or may adopt them in the future as their vaults fill to capacity. In light of this risk and the severe consequences that could result from the unsealing of your client's documents, steps should be taken to protect those documents, no matter where they were filed and what the court's current policy is.

An additional concern is maintaining documents as restricted or sealed when appeal is taken. A new operating procedure of the seventh circuit requires parties to request the court that documents filed as sealed in the district court maintain that status on appeal. If no such request is made within 14 days, documents that were sealed in the district court become public record in the seventh circuit's files.¹⁵

Some general-practice management steps should be observed in any court to protect your clients and yourself from disclosure of documents filed under seal.

• Always study a court's local rules and general orders for provisions relating to sealed or restricted documents. The importance of avoiding damaging disclosures even merits a brief telephone call to the court clerk's office after final disposition to ask how the court preserves or disposes of restricted and sealed documents.
• Keep your own complete list of sealed and restricted documents containing your client's confidential information, including such documents filed by other parties in the case.
• If confidentiality is your client's paramount concern, periodic inspection of the public court file throughout litigation and even after may be prudent. As Salomon Smith Barney illustrates, restricted documents can "find their way" into the public file; it would be better for you to get to them before the news media, a competitor, or litigation opponent finds them.
• Immediately when a notice of appeal is filed, scrutinize the appellate court's rules, general orders, and operating procedures for provisions relating to sealed or restricted documents. Contact the appellate court's clerk about any relevant policies and procedures to ensure that protections established in the trial court are maintained.
• To avoid the surprise of future purging and disclosure policies, secure the return of all restricted documents after the close of litigation if the court allows it.

To protect documents from disclosure under the northern district of Illinois' Local Rule 26.2, attorneys must be concerned about sealed and restricted documents filed in cases years ago, as well as those in current or recently terminated litigation. Here are some additional tips for practicing in the northern district and seventh circuit.

• For old cases, request a copy of the list of cases published in 1999 from the northern district court clerk's office and run a search against your client list. You may even turn up a case that another attorney handled for one of your clients years ago, giving you an opportunity to heroically save your new client from disclosure of sensitive information.

• If you find any client matches, call the northern district's docket department and check on the status of any sealed or restricted documents. If it's not too late, contact your client and offer to bring a motion requesting that each of the documents be returned.

• In the seventh circuit, bring a motion immediately upon appeal requesting that all documents sealed in the district court be maintained under seal in the appellate court, pursuant to that court's Operating Procedure 10.

• Add Local Rule 26.2(e) to your case disposition checklist for northern district cases. If documents were filed under seal or other restriction, be sure to bring a motion within 63 days after final disposition of the case (including appeal), requesting that each restricted and sealed document be removed from the court's vault and returned.
• Your Local Rule 26.2(e) motion should not contain a blanket request for return of "all documents filed under seal or restriction." Instead, list each document by name and filing date. You can obtain the court docket sheet to help with this, but don't only request return of the documents noted on the court's docket sheet as restricted or sealed. Call the docket department and ask a clerk to check the physical file in the vault and tick off the documents found there on the docket sheet. Any additional documents in the vault that are inadvertently not coded as restricted on the docket sheet could become public if you fail to get them returned to you.¹⁶
• If other parties have filed sealed or restricted documents containing your client's sensitive information, contact the other parties' counsel and volunteer to bring a joint motion under Local Rule 26.2(e).

The northern district's policy of opening documents filed under seal and making them available to the public presents a new threat to the privacy of litigants, from juveniles to corporations. Litigators should recognize that this is a risk they must be ready to address not only in the northern district, but in all courts, state and federal, and at every level. The best assurance of the security of your clients' documents comes from informing yourself of court rules and policies, working through them to maintain documents as restricted or sealed at every stage and level of litigation, and to secure the return of those documents, whenever possible, when litigation has ended.

1.  2001 WL 225040 (SD NY).

2. Id at *1.

3. Id.

4. Id.

5. Id at *2.

6. Id at *3.

7. See ND Ill LR 26.2(e). Local Rule 26.2 of the northern district of Illinois reads, in full:

(a) Definitions. As used in this rule the term:

"Restricted document" means a document or an exhibit to which access has been restricted either by a written order, or by a rule;

"Sealed document" means a restricted document which the court has directed be maintained within a sealed enclosure such that access to the document requires breaking the seal of the enclosure;

"Document awaiting expunction" means a document or an exhibit which the court has ordered held for possible expunction pursuant to 21 USC § 844(b)(2) but for which the period for holding prior to final destruction has yet to pass; and

"Protective order" means any protective order entered pursuant to Fed R Civ P 26(c), or any other order restricting access to one or more documents filed or to be filed with the court.

(b) Restricted Order. The court may on written motion and for good cause shown enter an order directing that one or more documents be restricted. The order shall also specify the persons, if any, who are to have access to the documents without further order of court. The minute order accompanying the order shall specify any qualifications as to access and disposition of the documents contained in the order.

(c) Docket Entries. The court may on written motion and for good cause shown enter an order directing that the docket entry for a restricted document show only that a restricted document was filed without any notation indicating its nature. Absent such an order a restricted document shall be docketed in the same manner as any other document except that the entry will indicate that the document is restricted.

(d) Inspection of Restricted Documents. The clerk shall maintain a record in a manner provided for internal operating procedures approved by the Court of persons permitted access to restricted documents. Such procedures may require anyone seeking access to show identification and to sign a statement to the effect that they have been authorized to examine the restricted document.

(e) Disposition of Restricted Documents. When a case is closed in which an order was entered pursuant to section (b) of this rule, the clerk shall maintain the documents as restricted documents for a period of 63 days following the final disposition including appeals. Except where the court in response to a request of a party made pursuant to this section or on its own motion orders otherwise, at the end of the 63 day period the clerk shall place the restricted documents in the public file.

Any party may on written motion request that one or more of the restricted documents be turned over to that party. Such motion shall be filed not more than 63 days following the closing of the case period.

In ruling on a motion filed pursuant to this section or on its own motion, the court may authorize the clerk to do one of the following for any document covered by the order:

(1) turn over a document to a party; or

(2) destroy a document; or

(3) retain a document as a restricted document for a period not to exceed 20 years and thereafter destroy it.

8. The definitions are a remnant of the former, and much more substantial, General Rule 10. In addition to these definitions (originally contained in General Rule 10(A)), the former rule contained the original versions of Local Rules 26.2, 5.7 and 5.8 regarding protective orders, restricted documents and cases and documents filed under seal. Unlike the current local rules, General Rule 10 also required the clerk to maintain a separate area for storage of restricted documents and prescribed disciplinary action for court employees who violated strict rules for the protection of restricted documents. Court employees' handling of restricted documents and disciplinary action for mishandling, as well as special procedures for disposing of grand jury documents, are now included in the court's Internal Operating Procedure 30.

9. See ND Ill LR 26.2(a). Local Rule 5.8 confirms that restricted and sealed documents are treated similarly. Rule 5.8 requires parties filing a "restricted or sealed document" to include certain information on the document's cover sheet, including the title "Restricted Document Pursuant to LR26.2."

It should be noted that Local Rule 5.8 contains another potential pitfall: if sealed or restricted documents are presented for filing without the required cover page as dictated by that rule, or without a copy of the protective or restrictive order, the document will be treated like any other document, and the clerk is authorized to open the sealed envelope to process it for the public file. See ND Ill LR 5.8.

10. Another quirk of Local Rule 26.2 is found in the definition of "document awaiting expunction," which refers to 21 USC § 844(b)(2), a provision which was repealed by Congress in 1984. See Pub L 98-473. Although Local Rule 26.2 was revised in 1996 and 1999, this archaic reference (in what appears to be an extraneous definition) was apparently overlooked during both revisions. See ND Ill LR 26.2(a).

11. See ND Ill L Cr R 6.2.

12. ND Ill LR 79.1(c).

13. Id.

14. See United States v Corbitt, 879 F2d 224, 228 (7 Cir 1989) (holding that although "the common law right of access creates a 'strong presumption' in favor of public access to materials submitted as evidence in open court, this presumption should not apply to materials properly submitted to the court under seal") (citation omitted); see also Grundberg v Upjohn Co., 140 FRD 459 (D Utah 1991).

15. Operating Procedure 10 of the seventh circuit court of appeals reads, in full:

(a) Requirement of Judicial Approval. Except to the extent portions of the record are required to be sealed by statute (e.g., 18 USC § 3509(d)) or a rule of procedure (e.g., Fed R Crim P 6(e), Circuit Rule 26.1(b)), every document filed in or by this court (whether or not the document was sealed in the district court) is in the public record unless a judge of this court orders it to be sealed.

(b) Delay in Disclosure. Documents sealed in the district court will be maintained under seal in this court for 14 days, to afford time to request the approval required by section (a) of this procedure.

16. Although the northern district's Local Rule 26.2(c) requires that docket entries for documents filed under seal or restriction must indicate that the document is restricted, one ministerial error could result in a serious disclosure.

William F. Zieske is a litigator with Ross & Hardies, P.C. in Chicago, where he focuses his practice on commercial litigation in federal and state courts, as well as oil and gas and public utility tort litigation and trials. He earned his B.A. magna cum laude from Washington University in St. Louis in 1991 and his J.D. summa cum laude from the University of Notre Dame in 1997, where he served as the executive article editor of the Notre Dame Law Review.