Colorado Opinion on Protective Orders

Defendant Farmers Insurance Exchange convinced the trial court that it should enter a protective order limiting Plaintiff’s counsel ability to distribute documents produced in the litigation by the defendant and limiting Plaintiff’s counsel’s use of  Defendant’s documents that Plaintiff’s counsel obtained from other sources.  The later documents had been produced by the Defendant without a protective order in litigation in South Dakota.

The documents at issue were described as follows:  "The documents apparently contain information regarding ‘incentive performance compensation plans’ and the Colossus claims-handling system used by Farmers. Farmers explains in its brief that ‘Colossus’is a proprietary computer tool created by Computer Sciences Corporation (‘CSC’), and that Farmers’use of Colossus and related materials is limited by a licensing agreement and nondisclosure agreement with CSC. Such agreements with CSC are at least one reason why Farmers sought a protective order in this case."

The Colorado Supreme Court reversed.  It stated that "that the protective order entered by the district court is not authorized by C.R.C.P. 26(c) to the extent that it purports to place limits on the use of documents not acquired solely as a result of discovery in this case."  The Court analyzed the law interpreting its version of Rule 26 and said "that C.R.C.P. 26(c) applies only to documents or information obtained solely as a result of discovery in a pending case. It does not authorize restrictions on documents acquired outside of the discovery process in the pending case. "

The case is Jesse v. Farmer’s Insurance Exchange, Case No. 05SA370 (Co. S. Ct. November 20, 2006).  Read it here.