Unreported / Non-Citable
Background
Plaintiffs Internet Money Records, LLC and Taz Taylor Beats, LLC sued TenThousand Projects, LLC, TenThousand Music Publishing, LLC, TenThousand Projects Holdings, LLC, Warner Music Group Corp., and Warner Music Inc. in the Central District of California in November 2025. The order does not describe the underlying claims, so this article addresses only the discovery-confidentiality ruling. The parties represented that discovery is likely to involve sensitive business, commercial, financial, technical, or proprietary information, including royalty statements, accounting records, audit materials, artist and producer agreements, revenue and expense information, and source files.
The parties filed a joint motion under Federal Rules of Civil Procedure 26(c) and 29 for a stipulated protective order. They explained that their proposal closely follows Magistrate Judge Sagar's standard protective order but adds an express ATTORNEYS' EYES ONLY designation with a defined list of permitted recipients and memorializes an agreement under Federal Rule of Evidence 502(d). Counsel for the parties dated the stipulation October 30, 2026.
The Court’s Holding
On November 2, 2026, Magistrate Judge Alka Sagar found good cause shown, granted the motion, and entered the stipulated order. It creates two tiers of protection. CONFIDENTIAL material may be disclosed to outside and house counsel and their staff, to the receiving party's officers, directors, members, agents and employees where reasonably necessary, to experts and vendors who sign an acknowledgment, to the court and court reporters, to authors and recipients, to deposition witnesses under stated conditions, and to agreed mediators. ATTORNEYS' EYES ONLY material may go only to a narrower group: counsel, signed experts, the court, court reporters, trial consultants and vendors who signed, authors and recipients, and mediators. It excludes the receiving party's own officers, directors and employees.
Designations must be made with restraint and in good faith. Mass, indiscriminate or routinized designations are prohibited and may expose the designating party to sanctions. A challenger starts the Local Rule 37.1 process, the designating party bears the burden of persuasion, and material keeps its designation until the court rules. Protected material may be used only to prosecute, defend or attempt to settle this action. The order also reaches non-party productions, sets notice and cooperation duties if protected material is subpoenaed in other litigation, and requires immediate written notice and retrieval efforts after any unauthorized disclosure.
Disclosure of privileged or work-product material, whether inadvertent or otherwise, is not deemed a waiver, and the order is to be interpreted to provide the maximum protection allowed by Rule 502(d). On notice of a clawback claim, the receiving party must promptly return the material, refrain from using or disclosing it until the matter is resolved, and take reasonable steps to retrieve copies it further shared; it may submit the material to the court under seal to test the claim. The order does not govern trial use. Designated material used or introduced at trial becomes presumptively public unless the trial judge finds compelling reasons, and the order's protections otherwise do not extend beyond the start of trial. After final disposition, within 60 days of a written request, receiving parties must return or destroy protected material and certify that they did so, though counsel may keep archival copies, which remain subject to the order.
Key Takeaways
- The order is a stipulated protective order entered on a showing of good cause; it is not a ruling on the merits and resolves no claim or defense.
- ATTORNEYS' EYES ONLY material cannot be shown to the receiving party's own officers, directors, members, agents or employees, although eligible house counsel and signed experts may see it.
- Under the Rule 502(d) language, disclosure of privileged or work-product material does not waive protection, and the receiving party must return the material on notice while any dispute is resolved.
- Designation does not authorize sealing: a party seeking to file protected material under seal must follow Civil Local Rule 79-5 and obtain a court order.
Why It Matters
This is an unpublished, stipulation-based discovery order by a magistrate judge and carries no precedential weight. Its practical value lies in showing how parties can modify the court's standard form to add an attorneys'-eyes-only tier and a Rule 502(d) agreement.
Much remains open. The order decides no individual designation, challenges must follow Local Rule 37.1, sealing requires a separate application under Civil Local Rule 79-5, either side may seek modification, and the trial judge will control confidentiality at trial.