The Competition Appeal Tribunal (the CAT) and High Court have been considering the circumstances in which confidentiality rings are appropriate in competition and other proceedings. The key takeaway is that parties should consider whether the additional protection of a confidentiality ring is appropriate in circumstances where the collateral use restrictions in the Civil Procedure Rules (the CPR) or CAT Rules are not sufficient.
The collateral use restrictions (in CPR r. 31.22 and rule 102 of the CAT Rules) require parties to use disclosed documents only for the purpose of the proceedings. When further confidentiality restrictions are required over and above this, a confidentiality ring may be put in place to restrict access to certain documents to a specific subset of people (e.g. external legal representatives and experts).
Confidentiality rings in the High Court
The use of confidentiality rings in the High Court was considered in a ruling earlier this year in the so-called “Dieselgate” claim1. The overarching theme of the judgment is that open justice is a key principle of English litigation and, as confidentiality rings are a departure from this, their use needs to be justified. In other words, if the confidentiality of documents is to be asserted, it must be justified by reference to the precise contents of the documents in question. This includes grappling with the passage of time and its effect on confidentiality, as well as considering whether otherwise valid claims to confidentiality can be displaced on public interest grounds if they reveal serious wrongdoing (sometimes known as the iniquity exception). In light of these principles, the court in this case rejected blanket claims for confidentiality in connection with German regulatory findings over all except one of more than 1,000 documents that had been placed into a confidentiality ring.
Confidentiality rings in the CAT
Meanwhile, and in a similar vein, CAT Practice Direction 1/2024 (the Confidentiality PD) provides guidance on the management of confidential information in competition proceedings, in which confidentiality rings are very often used to protect, amongst other categories, competitively sensitive information.
The Confidentiality PD raises concerns regarding the increasing complexity of confidentiality rings, the difficulty of managing them, and the large numbers of documents being disclosed into them on a blanket basis without specific reasons being provided. At the same time, the Confidentiality PD explicitly recognises that the additional protection provided by a confidentiality ring order (or other orders maintaining confidentiality over documents) is likely to be required where disclosure is likely to have direct and material adverse consequences – whether to the public interest, legitimate business interests, or the private affairs of an individual.
As regards the approach to any additional protections, the CAT explains that it expects parties to consider confidentiality issues that are likely to arise in the case by reference to:
- the nature of the case; and
- the particular sensitivity of the information contained in documents that the parties will be disclosing or expect to have disclosed to them.
As regards the nature of the case, the CAT sets out its general approach to various scenarios. In particular, it is worth noting that the CAT recognises that, for public policy reasons, the disclosure of materials relating to regulatory investigations requires careful management. In addition, the CAT notes that there may be a distinction between what may be disclosed to a proposed class representative (the PCR) in collective proceedings versus what may be disclosed to proposed class members, given that the PCR will be subject to restrictions on the use of documents for purposes other than the proceedings.
As regards the sensitivity of the information, the CAT reiterates some of the key principles relevant to claims for confidentiality. As will be familiar to those involved in submitting confidentiality requests in competition authority investigations, the Confidentiality PD suggests that information contained in documents with the following characteristics will not normally be confidential:
- data which is more than five years old;
- information that is unspecific or general; and
- statements which are aspirational but without particular strategic or tactical content.
Conclusions
It is clear from the above that there is judicial interest in the way confidentiality rings operate in practice. When setting up confidentiality rings and disclosing documents, parties should consider what confidentiality restrictions are necessary, taking into account the dynamics of the case and the nature and age of the information to be disclosed.
In this context, it is important for all parties to be pragmatic in identifying a workable solution that balances the requirements of open justice against confidentiality concerns. Depending on the circumstances, this might include additional case management steps to address confidentiality de-designation efficiently later in a case, to avoid disproportionate and impractical confidentiality reviews at its outset. This might be appropriate where significant volumes of documents are being disclosed to claimants at an early stage, and it is likely that only a small subset will ultimately fall for consideration at trial.
Where confidentiality rings are imposed, the courts take their responsibility to ensure due protection of the information within them extremely seriously. This is demonstrated by a recent ruling regarding breach of a confidentiality ring order in the Boyle CPO proceedings2, in which the CAT ordered an injunction with a penal notice forcing a paralegal to return a laptop and prohibiting the use of confidential information relating to the case.
Footnotes
1. Aurora Cavallari and others v Mercedes-Benz Group AG and others [2024] EWHC 190 (KB)
2. David Courtney Boyle v Govia Thameslink Railway Limited & Others [2024] CAT 26
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