Unreported / Non-Citable
Background
Gabriel Container, a California corporation, filed suit against Bank of America, National Association, and Does 1-20 in the United States District Court for the Central District of California, Western Division (Case No. 2:26-cv-01811-SRM-MBK). The parties anticipated that discovery would involve production of confidential, proprietary, or private information warranting special protection from public disclosure and use beyond prosecuting the litigation. On September 11, 2026, counsel for both parties stipulated to a proposed protective order and petitioned the court to enter it.
The stipulation acknowledged that the order does not confer blanket protections on all disclosures and that protection extends only to information entitled to confidential treatment under applicable legal principles. The parties further acknowledged that the order does not entitle them to file confidential information under seal, as Civil Local Rule 79-5 governs sealing procedures. The good cause statement identified trade secrets, customer and pricing lists, confidential business or financial information, confidential business practices, and other proprietary commercial information as categories likely to be produced.
The Court’s Holding
On October 19, 2026, United States Magistrate Judge Michael B. Kaufman granted the parties' stipulated protective order, finding good cause exists. The order defines "CONFIDENTIAL" information as material qualifying for protection under Federal Rule of Civil Procedure 26(c), including trade secrets, confidential business information, and other proprietary data. It establishes a single tier of confidentiality and requires designating parties to exercise restraint, prohibiting mass or indiscriminate designations. The order sets forth detailed procedures for designating protected material in documentary form, deposition testimony, and other tangible items, and provides a mechanism for correcting inadvertent failures to designate.
The order restricts use of protected material to prosecuting, defending, or settling the action and limits disclosure to specified categories of recipients, including outside counsel, party officers and employees, experts, the court, court reporters, trial consultants, professional vendors, authors or recipients of documents, deposition witnesses, and mediators. All recipients must sign an "Acknowledgment and Agreement to Be Bound" (Exhibit A). The order includes modern provisions addressing artificial intelligence, permitting AI tools only if enterprise-grade with contractual confidentiality and data-protection restrictions prohibiting model training on client data. It also mandates data breach notification, secure storage and shipping requirements, and procedures for inadvertent production of privileged material under Rule 26(b)(5)(B) and Federal Rule of Evidence 502. Upon final disposition, receiving parties must return or destroy protected material within 60 days, though counsel may retain archival copies subject to the order's continuing obligations.
Key Takeaways
- The court entered a comprehensive stipulated protective order governing confidential discovery in a federal commercial dispute between Gabriel Container and Bank of America.
- The order includes specific provisions for artificial intelligence tools, requiring enterprise-grade software with contractual restrictions against model training on client data.
- Protected material must be designated with particularity; mass or indiscriminate designations are prohibited and may result in sanctions.
- The order mandates prompt written notice of data breaches involving protected material and requires reasonable investigation, remediation, and cooperation.
- Upon final disposition, receiving parties must return or destroy all protected material within 60 days and submit written certification, though counsel may retain archival copies.
Why It Matters
This protective order reflects contemporary best practices in federal discovery management, incorporating specific safeguards for artificial intelligence review tools and data breach response protocols. The AI provision addresses growing concerns about confidential client data being used to train commercial models, requiring enterprise-grade solutions with contractual protections.
The order's detailed framework for designation challenges, inadvertent privilege production, and non-party protections provides a template for complex commercial litigation in the Central District of California. Its incorporation of Rule 502(d) and (e) agreements for clawback of privileged material aligns with modern e-discovery practices.