This is the final installment of an article on the effects of secret financial and credit practices on us all.
Please Read The Disclaimer. ©2019 Dennis J. Wall. All Rights Reserved.
Proposed secrecy orders in the 2015-2016 California lawsuit filed by the L.A. City Attorney. Many of the changes made by the secrecy agreements in the California lawsuit were made earlier in previous lawsuits, as noted. Other Rules changes in the agreements signed in this case have not often appeared in other cases, however.
There are three main ways in which the January secrecy agreement validated by the judge in February changes the Rules. Each change protects the secrecy of just how big the catastrophe really is. Even as these words are written in this book, it is uncertain whether the full extent of the man-made disaster of alleged cross-selling is known even now.
Again, the Rules were changed by agreement in this case to relieve the L.A. City Attorney's Office and Wells Fargo of any obligation to follow many Rules in this case which apply to other lawsuits.
- The secrecy agreements and proposed orders define "confidential" to mean what the lawyers say it means. One of the familiar features of secrecy agreements in private litigation is that the definition of exactly what is "confidential" is always what the lawyers say it is. The agreements do not give much of a definition.
What guidance the agreements do give on what is going to be "confidential" in the present case is certainly not based on judges' decisions in past cases. The agreements and proposed orders generally say that "confidential" means simply whatever evidence the lawyers choose to mark with the word, "confidential." This includes documents and testimony in all such cases.
In the case of People of California v. Wells Fargo, a judge signed a proposed order which made this proposed agreement into the judge's ruling. The February order validating the January secrecy agreement was likely written by the bank. The judge did not rewrite it. To the contrary, she took the proposed order, crossed out the word, "proposed," and signed it. At that point, the stipulation that lawyers wrote became the judge's ruling.
The February order which validates the January secrecy stipulation in the People of California v. Wells Fargo case continues down the foggy road of secrecy by adding that "confidential" means any documents or testimony that a party (including its lawyers) "believes in good faith ... is entitled to confidential treatment under applicable law."[1]
This includes giving the bank and the L.A. City Attorney in that case "the right to designate as 'Confidential'" any "non-public information," including documents and testimony.[2]
There is no such thing in the Rules as "non-public information." The Rules do not even use that term. Making "non-public information" mean the same thing as protected "confidential" evidence makes it clear that the parties in this case were rewriting the Rules for their own use and, intentionally or not, keeping the evidence away from the eyes of the public.
The people writing the secrecy stipulations in these cases removed any requirement that concealment depends on "good cause shown." As we have previously discussed on this blog, participants in civil lawsuits in most courts in the United States, including in California,[3] can ask a judge to protect them from such things as annoyance, embarrassment, oppression, or undue burden or expense. However, they cannot ask a judge to protect them under any of the Rules from "non-public information" that may find its way into documents and testimony just because the "information" is "not public," as the participants in the People v. Wells Fargo lawsuit wrote here.
Rather, as we have already seen, the Rules generally governing civil litigation require a party withholding documents during discovery to show "good cause" not to disclose them. Judges ordinarily rule that the party withholding evidence during litigation has to show that the evidence is privileged or protected from disclosure in some legally recognized way. Trade secrets "or other confidential research, development, or commercial information"[4] are examples. "Non-public information" is not.
Over all, the stipulation adopted by a judge's order in February, 2016 in People v. Wells Fargo lines up behind many other secrecy stipulations and orders used in many other jurisdictions. It restricts the use of any evidence marked "confidential," to the lawsuit in which the stipulation is filed. It provides that such evidence may not be used for any other purpose "whatsoever."[5] This was pretty obviously intended to be taken literally. It would mean that the only people who can use evidence marked "confidential" in the People of California v. Wells Fargo case in California are the people involved in that case. No-one else can ever use it, or even see it. Even the people involved in the case named People of California v. Wells Fargo cannot use such "confidential" evidence anywhere else.
So, perhaps it is wrong, after all, to assume without evidence that the L.A. City Attorney's Office shared Wells Fargo's forbidden special interrogatory answers with the federal agencies, or with anyone else. This is a much more certain way of keeping a secret than asking a judge to apply the law.
In the names of the Bank and of the People, the parties to this case made "competitively sensitive" documents, testimony, and information all secrets they could keep without admitting that any of it was really "competitively sensitive."[6] By grafting the concept of keeping "competitively sensitive" secrets to the overall idea of court protection, the parties rewrote the Rules to benefit themselves, or perhaps more accurately, one of them did and the other agreed to it. The Rules say nothing about keeping evidence from the public because the evidence might be "competitively sensitive," of course.
What evidence Wells Fargo may have had in the People of California v. Wells Fargo lawsuit is something we may never know. Wells was granted the "right" in this case by this stipulated secrecy order to conceal whatever it knew.
When the judge signed this stipulation into an order, Wells Fargo's "right" became a ruling and not just an agreement.
- Under Secrecy agreements and Secrecy orders like the ones in this case, what was marked "confidential" stays "confidential" even if it is put in front of the judge. California Rules of Court 2.550 and 2.551 were written to cover the case of what evidence can be sealed and how someone can go about asking a judge to seal that evidence. However, neither of these Rules applies to the evidence exchanged between the parties as a lawsuit goes forward, which again is called discovery.
Under the law of discovery, everybody else drops the argument that they have a "right" to conceal evidence, once they argue that previously concealed evidence is a part of their case. This includes when they give the judge the evidence they previously marked "confidential" in an effort to get a favorable ruling from the judge on one of their motions.
Secrecy agreements and their secrecy orders like the ones in this case make the exchange of evidence during litigation more of a joint exercise in concealment than a concerted effort at discovering the truth, or at least discovering evidence. Using these agreements and orders, people can show concealed evidence to a judge, but not to the public, just by putting the evidence into an envelope marked "CONFIDENTIAL--FILED UNDER SEAL PURSUANT TO PROTECTIVE ORDER AND WITHOUT ANY FURTHER SEALING ORDER REQUIRED."[7] This simply could not be done without the secrecy agreements and their orders rewriting the Rules.
- Keeping control over the evidence marked "confidential." The secrecy stipulations in this case, and the January, 2016 agreement in particular, were also written to keep control of the "confidential" evidence after the case was over. The January stipulation provides that it shall always be "binding" unless the party that designated the evidence as confidential, or a judge, says otherwise.[8]
It apparently was not enough to make the January stipulation in this case endless, however, even after it became a judge's order in February, 2016. The agreement and its order also add a provision typically found in secrecy stipulations-turned-into-secrecy-orders in many other cases, to the effect that once the case ends, "confidential" evidence must either be returned to the party that designated it "confidential," or it must be destroyed.[9] In short, the people that possess the evidence marked confidential are required to give it up at the end of that case. They cannot make the evidence public. The evidence can only be used for that one case. When that one case ends, then the way that the thinking goes behind the secrecy here, there is no longer any reason to hold onto the evidence. The public has no interest in it, according to the lawyers who write these agreements, it seems, and the public seemingly has no dog in this fight either, according to the judges who enable this behavior by validating these secrecy agreements.
Please Read The Disclaimer. ©2019 Dennis J. Wall. All Rights Reserved.
[1] Stipulation and Protective Order ¶ 1.c., at page 1, entered and filed on February 2, 2016 in People v. Wells Fargo & Co., Case No. BC 580778 (Los Angeles County Superior Court).
[2] Id., ¶ 2, at page 2.
[3] The California Code of Civil Procedure regulates civil litigation in California courts. California Code of Civil Procedure § 2031.060(b) provides in part here pertinent as follows in this regard:
(b) The court, for good cause shown, may make any order that justice requires to protect any party or other person from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense.
[Boldface added.]
[4] Federal Rule of Civil Procedure 26(c)(1)(G).
[5] Stipulation and Protective Order ¶ 9, at page 6, entered and filed on February 2, 2016 in People v. Wells Fargo & Co., Case No. BC 580778 (Los Angeles County Superior Court).
[6] See id., ¶ 11.a, at p. 6.
[7] Id., ¶ 18, at p. 8.
[8] Id., ¶ 21, at p. 8.
[9] Id., ¶ 22, at p. 9.
Please Read The Disclaimer. ©2019 Dennis J. Wall. All Rights Reserved.
Comments