The opinion of the court was delivered by: HARVEY BARTLE, III, District Judge
The Trustees of the AHP Settlement Trust ("Trust") involving Wyeth's
diet drugs Pondimin and Redux have sued defendant Linda Crouse, M.D.
under the Racketeer Influenced and Corrupt Organizations Act ("RICO"),
18 U.S.C. § 1964, et sea., and for other wrongful conduct in
connection with attestations that certain class members suffered from
valvular heart disease ("VHD") entitling them to benefits from the Trust.
Before the court is the motion of the Trustees for entry of a
protective order. At issue is certain "confidential information" which
defendant Linda Crouse, M.D. seeks to obtain from the Trust through
discovery. The Trustees contend the information is subject to the
protective order entered by this court in Pretrial Order ("PTO") No. 2683
in connection with the Nationwide Class Action Settlement Agreement and
the Multi-District Litigation No. 1203 involving Wyeth's diet drugs, Pondimin and Redux.*fn1 The Trustees maintain they cannot produce
this information without a court order.
In their supporting memorandum, the Trustees first point out that they
do not intend to prevent the defendant, her legal team, prospective
experts, or other agreed-upon and court-approved persons from having
access to the "confidential information" designated in PTO No. 2683. The
Trustees have also offered to narrow the definition of "confidential
information" to reflect the less comprehensive delineation in PTO No. 2875.
However, they argue that there is good cause to enter a protective order
because one is necessary to effectuate the purposes of PTO No. 2683 and
to prevent both parties and non-parties to the Diet Drugs litigation from
obtaining information from the defendant that could not otherwise be
obtained. The Trustees contend that the privacy interests of claimants
under the Settlement Agreement, the Trust's development and
implementation of internal policies and procedures, and the other
concerns outlined in PTO No. 2683 are at stake.
Dr. Crouse agrees that limited claimant-identifying information such as
names, addresses, and social security numbers should be protected from
public dissemination. Indeed, she too is withholding the same sort of
information pending the entry of a protective order by the court.
However, she argues that good cause does not exist to enter a more
expansive order. Dr. Crouse's defense and counterclaims apparently rest
at least to some extent on alleged deficiencies with internal policies
and procedures of the Trust and the Trustees. She contends she should be
entitled to share information with others who have or will themselves
become targets of the Trust's investigations. In addition, she suggests
that because the May 3, 2004 deadline to file claims has now passed, the
rationale for keeping "confidential information" confidential no longer
exists because claimants will not be able to use that information to
"game the system." Finally, Dr. Crouse emphasizes that the Trustees' action against her is not actually part of the Diet Drugs
Our evaluation of the Trustees' request is guided by the standard set
forth by our Court of Appeals in Glenmede Trust Company v.
Thompson, 56 F.3d 476
(3d Cir. 1995) ("Glenmede"), and
Pansy v. Borough of Stroudsburq, 23 F.3d 772
(3d Cir. 1994). As
articulated in Glenmede, "[a] party seeking a protective order
over discovery materials must demonstrate that `good cause' exists for
the protection of that material. . . . `Good cause' is established when
it is specifically demonstrated that disclosure will cause a clearly
defined and serious injury. Broad allegations of harm, unsubstantiated by
specific examples, however, will not suffice." Glenmede, 56
F.3d at 483 (internal citations omitted). See also Fed.R. Civ.
P. 26(c). Several factors are useful in making a determination of whether
a protective order should be entered:
1) whether disclosure will violate any privacy
2) whether the information being sought is for a
legitimate purpose or for an improper purpose;
3) whether disclosure of the information will
cause a party embarrassment;
4) whether confidentiality is being sought over
information important to public health and safety;
5) whether the sharing of information among
litigants will promote fairness and efficiency;
6) whether a party benefitting from the order of
confidentiality is a public entity or official;
7) whether the case involves issues important to
the public. Id. This list is not exhaustive, but "the analysis should
always reflect a balancing of private versus public interests."
Glenmede, 56 F.3d at 483.
As stated in PTO No. 2683, the protective order in the related Diet
Drugs litigation was necessary:
(i) to implement Section VIII.F.I of the
Settlement Agreement, which requires that any
information provided by or regarding a Class
Member or otherwise obtained pursuant to the
Settlement Agreement shall be kept confidential
and disclosed to appropriate persons only to the
extent necessary to process Claims or provide
benefits under the Settlement Agreement; and (ii)
to permit the successful and orderly
implementation of the Settlement Agreement by
preserving the confidentiality of proprietary
information regarding the internal procedures and
policies of the Trust and of the Trustees, the
former Interim Claims Administrators, any Claims
Administrator(s), and their employees,
contractors, and advisors that has been or will be
generated in the course of the implementation of
the Settlement Agreement. The Court finds that the
need to implement Section VIII.F.I of the
Settlement Agreement, the need to protect the
privacy of the medical information of Class
Members included in their claims, and the need for
the Trust to develop its procedures and policies
internally, constitutes good cause for the entry
of this Order.
PTO No. 2683. The Trustees seek protection of "confidential
information" similar to that defined in PTO No. 2683.
As to claimants' personal information, such as name, address, telephone
number, e-mail address, social security number, and other personal
identifying information, no one disputes the strong privacy interest at
stake. We agree with both parties that good cause exists at this time to
enter a protective order as to this information. The same reasoning also
applies to the records of the Trust's employees.
As to the internal procedures and policies of the Trust, we recognize
that the Trust has an important interest in confidentiality, particularly
in light of the large number of allegedly fraudulent claims filed and the
steps it is taking in its investigations of those claims. Over
eighty-four thousand Green Forms have been filed with the Trust under the
Settlement Agreement. This is a number far in excess of what anyone ever
expected when the Settlement Agreement was before the court for approval
at the time of the Fairness Hearing in 2000. See PTO No. 2662.
Although the Settlement Agreement originally called for a fifteen percent
audit, based on a finding in November, 2002 that the number of claims
submitted was "totally at odds with impressive and undisputed
epidemiological evidence presented at the Fairness Hearing," the court
found good cause to implement a one hundred percent audit requirement for
all Fund B claims. Id.
The Trust is a fiduciary for tens of thousands of claimants. In its
attempts to protect the large but limited fund it holds for deserving
claimants, the Trust has developed and is developing procedures and
policies to discover and protect against fraud. This court has a
compelling obligation to prevent the payment of finite Trust funds to
claimants whose claims are not supported by a reasonable medical basis.
Unlimited distribution of information relating to internal policies and
procedures could greatly impede the Trust's efforts to combat fraud. Thus, there is good cause to protect such information from
At the same time, this information appears to be an inherent part of
Dr. Crouse's defense and counterclaims. We reiterate that there is no
objection to Dr. Crouse's obtaining the information to which she is
entitled. We recognize that Dr. Crouse is entitled to the discovery she
needs for adequate preparation of her defense and pursuit of her
counterclaims against the Trust.
Accordingly, we will allow the parties to share information relating to
the internal policies and procedures of the Trust only as necessary to
prosecute and defend this litigation. In the event that a party has a
need to disclose confidential information to any person not designated as
an "authorized person," that party shall first seek a stipulation by the
other party in advance of intended production. We note that this
requirement applies to disclosures to any attorneys not retained by the
parties in this action and the agents and representatives of such other
attorneys, all of whom are excluded from the definition of "authorized
persons." If relief from the court is sought, the information may not be
disclosed pending a court ruling. If the court approves the disclosure,
the person will be deemed an authorized person under this order.
Disclosure to any expert, contractor, accountant, auditor, or other
authorized person retained by a party must, of course, be subject to a
confidentiality agreement. Further, as set forth in the accompanying order, before disclosing any
confidential information to an authorized person, the person making such
disclosure shall provide a copy of the court's order to the authorized
person and obtain ...