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From Products Liability Law Daily, March 11, 2016

NHTSA issues final bulletin on confidentiality provisions in protective orders, settlement agreements

By John Dumoulin.

The National Highway Traffic Safety Administration (NHTSA) has issued the final version of its Enforcement Guidance Bulletin 2015-01: “Recommended Best Practices for Protective Orders and Settlement Agreements in Civil Litigation.” This bulletin sets forth the agency’s recommended guiding principles and best practices for private litigants regarding the use of confidentiality provisions in protective orders and settlement agreements. It communicates NHTSA’s position that confidentiality provisions should not be used to prevent safety-related information discovered in private litigation from reaching the agency (NHTSA Final Notice, 81 FR 13026, March 11, 2016).

According to NHTSA, safety-related information developed or discovered in private litigation is an important resource for the agency, but confidentiality restrictions imposed as part of a protective order or settlement agreement in private litigation—whether court-sanctioned or privately negotiated—often prevent parties from providing information about potentially dangerous products to the agency.

Proposed bulletin. NHTSA published a proposed Enforcement Guidance Bulletin in the Federal Register on September 21, 2015 (80 FR 57046), setting forth what the agency had identified as best practices for private litigants utilizing protective orders and settlement agreements with confidentiality provisions. The agency received 124 comments. NHTSA said the majority of comments fully supported the Enforcement Guidance as drafted. Certain other comments—contending the guidance was unnecessary, raising concerns about the dissemination of proprietary information, and proposing the guidance be expanded to allow broader sharing of information and documents discovered through litigation—are discussed in the agency’s notice.

Final bulletin. NHTSA said that protective orders and settlement agreements should not be used to withhold critical safety information from the agency, either intentionally or unintentionally. It also stated that to the extent protective orders, settlement agreements, or other confidentiality provisions prohibit motor vehicle safety-related information from being transmitted to NHTSA, such limitations are contrary to established principles of public policy and law.

Still, NHTSA recommended that parties and courts seek to include a provision in any protective order or settlement agreement that specifically allows for disclosure of relevant motor vehicle safety information to NHTSA and other appropriate government authorities, regardless of any other restrictions on the disclosure or dissemination of the information.

NHTSA also said that private litigants should tailor the use of confidentiality provisions in a way that protects legitimate proprietary interests while still allowing for the provision of relevant information to NHTSA. The agency said it is not endorsing any particular language that should be utilized. It also said the bulletin is not a final agency action and is intended as guidance only.

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