Westinghouse Electric Company LLC, et al.,

UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
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In re
WESTINGHOUSE ELECTRIC
COMPANY LLC, et al.,
Debtors.
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Chapter 11
Case No. 17-10751 (MEW)
(Jointly Administered)
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DECISION REGARDING PROPOSED CONFIDENTIALITY ORDER GOVERNING
DOCUMENTS AND OTHER MATERIAL PROVIDED BY TOSHIBA CORPORATION
TO THE STATUTORY UNSECURED CLAIMHOLDERS’ COMMITTEE
On August 8, 2017, this Court entered a consent Order, in a form and substance agreed to
by Toshiba Corporation (“Toshiba”), the Statutory Unsecured Claimholders’ Committee (the
“UCC”) and other parties, that authorized the UCC to issue deposition and document subpoenas
to Toshiba and its affiliates, present and former directors, officers, employees and professionals
pursuant to Rule 2004. Pursuant to that consent Order Toshiba agreed that its attorneys would
accept the service of subpoenas on behalf of Toshiba, but without agreeing that witnesses who
reside outside the United States would appear for testimony in the United States.
By a further consent motion [ECF # 1532], Toshiba and the UCC now seek the entry of a
Confidentiality Order that will govern documents and information that Toshiba produces to the
UCC during the course of the agreed-upon Rule 2004 discovery. The proposed Confidentiality
Order contains certain familiar provisions regarding the treatment of information designated as
“Confidential” or as “Advisors’ Eyes Only,” along with procedures that allow the UCC to
challenge such designations. It also contains a familiar agreement that Confidential Material
may only be used “for the purpose of proceedings in these Bankruptcy Cases,” and a statement
that Toshiba shall use “reasonable care to avoid designating as CONFIDENTIAL any Material
that is not entitled to such protection under Fed. R. Civ. P. 26(c) or that is generally available to
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the public.” Id. ¶¶ 6(a). A more unusual provision appears in paragraph 10 of the proposed
Order, however, which states as follows:
Toshiba, relying on the provisions of this Order to protect the
CONFIDENTIAL Material it furnishes to the UCC, and intending by the
designation of documents as CONFIDENTIAL to secure the integrity of the
discovery process conducted by the UCC, intends by this Order to prohibit
modification of the Order’s provisions by any third party, including any state
or federal governmental entity, without the mutual agreement of the Parties to
such modification. The UCC also intends by this Order to prohibit
modification of the Order’s provisions by any Non-Party without the mutual
agreement of the Parties to such modification.
See Proposed Order, ¶ 10. The recitals further state that “Toshiba specifically intends to rely on
the terms of this Order to protect and safeguard its expectations of confidentiality in its
information from disclosure to state or federal government entities.” Id. at p. 2.
It is unclear whether the foregoing are merely to be considered as statements of the
parties’ own desires or whether, by entry of the Order, the parties intend the Court to adopt those
statements as binding restrictions on the future rights of third parties (including governmental
entities) to seek access to materials designated as “Confidential.” If the parties intend the latter,
then the Order would alter the rights of such third parties. Ordinarily, third parties who seek
discovery materials would have the right to seek to intervene in a case and to seek the
modification of a confidentiality order if they felt the circumstances warranted the modification.
Foreclosing such a right would affect not only a party’s potential rights to have access to the
materials, but also the ability to challenge the propriety of the “Confidential” designations made
by Toshiba, which only the UCC may challenge under the terms of the proposed Order.
The motion seeking entry of the Confidentiality Order was served on all persons who
have entered notices of appearance in these cases. However, there is no indication of whether
there are any particular governmental entities whose rights the parties seek to affect, and no
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clarity as to whether the affected governmental entities are even aware of the limitations in
paragraph 10 of the proposed Order.
At a hearing on October 18, 2017, the Court asked for further clarification as to what the
parties intend. The parties informed the Court on October 18 that they did not intend to modify
the standards that would apply in the event a governmental entity were to seek access to
materials provided by Toshiba to the UCC, and that they were not asking the Court to “pre-
judge” the question of whether a governmental entity would have access to such materials.
However, the parties have made clear that they do intend that any request for modification of the
Confidentiality Order to obtain materials for use in other proceedings be subject to the ordinary
standard applied in this Circuit, which is that a party seeking such a modification must show
“extraordinary circumstance or special need.” Martindell v. Int’l Tel. & Tel. Corp., 594 F.2d 291
(2d Cir. 1979).
It is important that the UCC have access to documents and other information from
Toshiba in connection with the tasks the UCC must perform in these cases. Agreements that
limit the use of such materials to these bankruptcy cases are ordinary and proper, and Toshiba is
entitled to such assurances. However, the Court will not pre-judge possible future requests for
access to such materials and will not foreclose parties from making requests to modify the
Confidentiality Order in accordance with applicable Second Circuit standards. The proposed
Confidentiality Order will be modified to make that clear.
Dated: October 27, 2017
New York, New York
s/Michael E. Wiles
THE HONORABLE MICHAEL E. WILES
UNITED STATES BANKRUPTCY JUDGE
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