# In Re Zyprexa Injunction

> District Court, E.D. New York · February 13, 2007 · 474 F. Supp. 2d 385

URL: https://www.frixlaw.com/law-library/cases/2579789

## Case

- **Full name:** In Re ZYPREXA INJUNCTION
- **Court:** District Court, E.D. New York
- **Decided:** February 13, 2007
- **Citations:** 474 F. Supp. 2d 385; 2007 WL 460838
- **Precedential status:** Published
- **Opinion:** Opinion by Weinstein
- **Judges:** Weinstein
- **Cited by:** 72 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/2579789

## How later opinions describe it (automated extraction)

- explaining that after a challenge to a confidentiality designation, “the burden of establishing that there is good cause to protect the designated materials rests at all times with the party seeking protection”
- stating that under Fed.R.Civ.P. 65(d), persons named in an injunction who act in concert with other parties are considered “parties” for purpose of its binding effect
- noting that in challenges to designations under umbrella protective orders, “the burden of establishing that there is good cause to protect the designated materials rests at all times with the party seeking protection”

## Opinion text

MEMORANDUM, FINAL JUDGMENT, ORDER & INJUNTION
WEINSTEIN, Senior District Judge.
Table of Contents
I. IntRoduction.391
II. Faots.397
A. The Litigation .397
B. Protective Order, Case Management Order No. 3.397
C. Agreement by Egilman to be Bound by Protective Order.399
D. Conspiracy of Berenson, Egilman, and Gottstein.400
E. Subpoenas Issued by Gottstein.401
F. Response to the Subpoenas.402
G. Discharge of Egilman by Lanier.403
H. Dissemination of Documents Pursuant to Conspiracy.403
1.
Acts by
Conspirators.403
2.
Protectable Distributed Documents
.404
I. Attempts by Special Master Woodin to Retrieve Documents .404
J. Publication by N.Y. Times.405
K. Formal Court Intervention .405
1.
Argument Before Magistrate Judge
Mann.405
2.
Temporary Restraining Order by Judge
Cogan.405
3.
Order to Show Cause for Deposition of Egilman by Judge
Weinstein.406
4.
Evasive Actions of Enjoined
Persons.406
5.
Preliminary Injunction by Judge
Cogan.407
6.
Hearing on Permanent Injunction By Judge
Weinstein.408
7.
Invitation to Berenson to Appear by Judge
Weinstein.408
a) Invitation.408
b) Response.411
III. Law .412
A. Public Right of Access to Documents Produced in Discovery.412
B. Protective Orders .413
1. Generally.413
2.
Rule 26(c)
.414
a) Generally.414
b) Subsection 7.415
3.
Umbrella Protective
Orders.416
4.
First Amendment Implications of Protective Orders
.416
C. Court Authority to Enforce Orders.417
1. Generally.417
2.
National
Scope.418
D. Injunctions.418
1. Generally.418
2.
Persons
Bound.418
3.
Enjoining Dissemination of Stolen Protected
Documents.419
*391
4.
Content Neutral
.420
IV. Application Of Law To Facts ^ tO 1 — L
The Documents are Properly Protected Under CMO-3. 4^. DO I — I
1.
CMOS is a Valid Umbrella Protective
Order. 4^. DO I — I
2.
Documents Contain Information Protectable by Rule 26(c) and
CMOS. DO 1 — 1
Court has Power to Order Return of Stolen Documents. td DO DO
Restrictions on Dissemination Do Not Violate First Amendment Rights O DO CO
1.
CMOS’s Restriction on Dissemination of Confidential Documents Does Not Implicate First Amendment
Rights. DO CO
2.
The Injunction’s Restriction on Dissemination Does Not Impinge on First Amendment Rights
. 4^ DO CO
Enjoining Persons Who Refuse to Return the Documents is Necessary to Prevent Irreparable Harm to Lilly. Ü 4^ DO 4^
Enjoining Persons Who Returned the Documents is Not Necessary to Prevent Irreparable Harm to Lilly. Websites Should Not Be Enjoined. All Named Persons are Bound by the Injunction. Persons Bound. 1.
Recipients of
Documents. 2.
Amelia
Desanto. 3.
N.Y. Times, National Public Radio and Snighdha
Prakash. 4. Berenson. 5.
Gottstein and
Egilman. 6. Websites. 7.
Persons Who Have Not Returned the
Documents. 8.
Persons
Restrained. WO¡4 H 4^4^4^.4^4^4^4^4^4^4^4^4^ DODODODODODODODODODODODO 00 00 00 00 00*^
But it was not out of the blue for Egilman or Alex Berenson? Ü <©
A: So I mean out of the blue — I mean — it seemed that — it’s like I said, what Alex Berenson told me was that he had told Dr. Egilman that I might be someone who would subpoena the documents so I don’t know where out of the blue comes into that.
Q: After the conversation that you had with Dr. Egilman on November 28, you agreed to subpoena the documents, correct?
A: Yes. Well, to at least try to. To try and find a case to do that.
Q: Okay. And you continued to communicate with Alex Berenson prior to your receipt of the documents relating to the articles that he was planning or hoping to write about Zyprexa, correct?
A: Prior to?
Q: Yes.
A: There may have been some.
Tr. of Hr’g, 95-99 (January 17, 2007).
Lilly shall forthwith serve a copy of this invitation on Alex Berenson, together with all papers filed in the current proceedings to obtain an injunction, including the full transcript of the January 16-17, 2007 hearing. Copies of this order, but not the accompanying papers, shall be served by Lilly via fax, email, or mail on all attorneys who appeared at the January 16-17, 2007 hearing.
SO ORDERED. /s/ Jack B. Weinstein
Date: January 29, 2007 Brooklyn, N.Y.
In re Zyprexa Prods. Liab. Litig.,
2007 WL 276185 (E.D.N.Y. Jan.29, 2007).
b) Response
By letter dated February 5, 2007, the New York Times responded on behalf of Berenson as follows:
Hon. Jack B. Weinstein United States District Court Eastern District of New York 225 Cadman Plaza East Brooklyn, New York 11201
Re: In re Zyprexa Products Liability Litigation
OI-MDL-1596
Dear Judge Weinstein:
I write in response to your Invitation and Order of January 29, 2007 (‘T/29 Order”) which, in accordance with Your Honor’s instructions, was provided to us by counsel for Eli Lilly, together with other materials pertinent to the motion for a preliminary injunction now pending before the Court.
We have reviewed the materials forwarded to us by counsel and most particularly the 1/29 Order and understand that there has been testimony presented to the Court by others concerning their perceptions of the circumstances that gave rise to The New York Times’s receipt of certain materials referenced in a series of articles published in the Times over the course of the last several weeks concerning Zyprexa and the controversy concerning it. On behalf of The Times and Alex Berenson, I would like to thank the Court for offering Mr. Berenson the opportunity voluntarily to appear before the Court and, in Your Honor’s words, to “confront [that] testimony.”
We know that Your Honor will appreciate the reasons that lead us to decline your invitation. As a matter of long-held principle, we believe that it would be inappropriate for any of our journalists voluntarily to testify about news gathering at the Times, our reporters’ communications with their sources or the editorial judgments that are made in
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deciding what is and what is not published by the Times, just as we would vigorously resist any effort by any party to compel such testimony. We guard quite zealously our role as a member of a free and independent press and believe quite passionately that, consistent with the principles embodied in the First Amendment, it is not the role of the newspaper or its reporters to submit to cross-examination about such matters even where it may otherwise serve our particular interests in a particular case to do so. I want to emphasize as clearly as I can that in declining Your Honor’s invitation we mean absolutely no disrespect whatsoever to the Court.
Consistent with the procedures set forth in the 1/29 Order, by copy of this letter I am requesting counsel for Eli Lilly to forward this correspondence to all interested counsel as I do not have contact information for all concerned.
Thank you for your time and consideration.
Respectfully submitted,
/a/
George Freeman
[Assistant General Counsel, N.Y. Times]
III. Law
A. Public Right of Access to Documents Produced in Discovery
A presumption of public access applies to judicial proceedings and documents.
Open courts are critical to a democratic society. Access to judicial proceedings and documents is necessary for federal courts to have a measure of accountability and for the public to have confidence in the administration of justice. The rule of law and public acquiescence in judicial decisions demand that courts reveal the bases for their rulings. Without monitoring, the public could have no confidence in the conscientiousness, reasonableness, or honesty of judicial proceedings. Such monitoring is not possible without access to testimony and documents that are used in the performance of Article III functions.
In re NBC Universal, Inc.,
426 F.Supp.2d 49, 51 (E.D.N.Y.2006) (quotations and citations omitted). See also
Nixon v. Warner Communications, Inc.,
435 U.S. 589, 597 , 98 S.Ct. 1306 , 55 L.Ed.2d 570 (1978) (“the courts of this country recognize a general right to inspect and copy public records and documents, including judicial records and documents”);
United States v. Amodeo,
71 F.3d 1044, 1048 (2d Cir.1995).
The presumption of access varies according to the nature of the judicial document to which access is sought. “Unlimited access to every item turned up in the course of litigation would be unthinkable.”
United States v. Amodeo, supra,
at 1048. The Court of Appeals for the Second Circuit has held that “the weight to be given the presumption of access must be governed by the role of the material at issue in the exercise of Article III judicial power and the resultant value of such information to those monitoring the federal courts.”
Id.
at 1049 .
The claim of public access is strongest when the documents play a substantial role “in determining litigants’ substantive rights.”
Id.
Fitting squarely within this definition are “documents that served as the principal basis for a summary judgment motion; were introduced at trial; or were material and important to a decision to approve a consent decree.”
In re NBC,
426 F.Supp.2d. at 53
(quoting Amodeo)
(quotation marks omitted).
Falling outside the definition are documents produced by the parties in discovery.
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Documents that play no role in the performance of Article III functions,
such as those passed between the parties in discovery,
lie entirely beyond the presumption’s reach, and stand on a different footing than a motion filed by a party seeking action by the court or, indeed, than any other document which is presented to the court to invoke its powers or affect its decisions.
Amodeo,
71 F.3d at 1050 (emphasis added) (quotation omitted). See also
S.E.C. v. TheStreet.com,
273 F.3d 222 , 232-33 (2d Cir.2001);
F.T.C. v. Standard Fin. Mgmt. Corp.,
830 F.2d 404, 409 (1 st Cir.1987) (“Those documents which play no role in the adjudication process ... such as those used only in discovery, lie beyond reach [of the presumption of access].”);
Anderson v. Cryovac, Inc.,
805 F.2d 1, 13 (1st Cir.1986) (“There is no tradition of public access to discovery, and requiring a trial court to scrutinize carefully public claims of access would be incongruous with the goals of the discovery process.”).
The entry of a protective order for documents produced in discovery does not affect the assumption of non-access which attaches to those documents.
See S.E.C. v. TheStreet.com,
273 F.3d 222 , 223 (2d Cir.2001) (rejecting argument that “the very exercise by the District Court of its power to enter a protective order and to seal the Confidential Testimony transformed the Confidential Testimony into a ‘judicial document’ presumptively open to the public”);
Pansy v. Borough of Stroudsburg,
23 F.3d 772, 782 (3d Cir.1994) (“[W]hen a court enters an order of protection over documents exchanged during discovery, and these documents have not been filed with the court, such documents are not, by reason of the protective order alone, deemed judicial records to which the right of access attaches.”).
B. Protective Orders
1. Generally
The inherent equitable power of courts to grant confidentiality orders is well-established.
See Seattle Times Co. v. Rhinehart,
467 U.S. 20, 35 , 104 S.Ct. 2199 , 81 L.Ed.2d 17 (1984) (“we have no question as to the court’s jurisdiction to [enter protective orders] under the inherent equitable powers of courts of law over their own process, to prevent abuses, oppression, and injustices”) (quotation omitted);
Int’l Prods. Corp. v. Koons,
325 F.2d 403 , 407-08 (2d Cir.1963);
Pansy v. Borough of Stroudsburg,
23 F.3d 772, 785 (3d Cir.1994) (“Courts have inherent power to grant orders of confidentiality .... whether or not such orders are specifically authorized by procedural rules.”). Courts are endowed with broad discretion to tailor protective orders to the circumstances of a particular litigation.
See Seattle Times,
467 U.S. at 36 , 104 S.Ct. 2199 (“The unique character of the discovery process requires that the trial court have substantial latitude to fashion protective orders.”).
The power to seal extends to court filings and documents produced in discovery.
See Pansy,
23 F.3d at 785 (rejecting the argument “that the district court lacked the power to enter an order of confidentiality over a document which is not in the court file nor incorporated into an order of the court”). As civil discovery rules became more expansive over the course of the last century, the role of the courts in protecting producing parties from undue invasions of privacy has correspondingly increased:
The adoption of the Federal Rules of Civil Procedure in 1938 fundamentally changed ... American procedure. In particular, the discovery system in Rules 26 through 37 revolutionized pretrial preparation. The prior system had lim
*414
ited a litigant’s ability to acquire information largely to what was admissible at trial; since 1938, a litigant has been able to secure the production of information on a vastly broadened scale — essentially, any information that conceivably could be of help in preparing the case.... The goals underlying the expansion of the discovery process were to facilitate preparation, to avoid surprise at trial, and to promote the resolution of cases on their merits — not to enlarge the public’s access to information. Nonetheless, the expanded scope of discovery under the Federal Rules and the increased amounts of information they generated created side effects outside the adjudicatory system — it posed a threat to privacy and confidentiality. To meet this new problem, the discovery rules contain provisions, such as the authorization for protective orders in Rule 26(e), to limit the discovering party’s use of information beyond the litigation context.
Arthur R. Miller,
Confidentiality, Protective Orders, and Public Access to the Courts,
105 Harv. L.Rev. 427, 447 (1991);
see also
8 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2036 (2d ed. 1994) (“Rule 26(c) was adopted as a safeguard for the protection of parties and witnesses in view of the almost unlimited right of discovery given by Rule 26(b)(1).”).
Protective orders serve essential functions in civil adjudications, including the protection of the parties’ privacy and property rights.
See Seattle Times Co. v. Rhinehart,
467 U.S. 20, 34-35 , 104 S.Ct. 2199 (“It is clear from experience that pretrial discovery ... has a significant potential for abuse. This abuse is not limited to matters of delay and expense; discovery also may seriously implicate privacy interests of litigants and third parties.”);
see generally
Miller,
Confidentiality,
at 463-77. “Without an ability to restrict public dissemination of certain discovery materials that are never introduced at trial, litigants would be subject to needless annoyance, embarrassment, oppression, or undue burden or expense.”
S.E.C. v. TheStreet.com,
273 F.3d 222 , 229 (2d Cir.2001)
(citing
Fed.R.Civ.P. 1).
2. Rule 26(c)
a) Generally
The Federal Rules of Civil Procedure govern the issuance of protective orders covering discovery materials in civil cases.
See
Fed.R.Civ.P. 26(c). “[F]or good cause shown, the court in which the action is pending ... may make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense.”
Id.
This rule, like the remainder of the Federal Rules of Civil Procedure, must be interpreted in a manner consistent with Rule 1: “These rules .... shall be construed and administered to secure the just, speedy, and inexpensive determination of every action.” Fed.R.Civ.P. 1;
see also Martindell v. Int'l Tel. & Tel. Corp.,
594 F.2d 291 , 295 (2d Cir.1979) (“the vital function of a protective order issued under Rule 26(c) ... is to secure the just, speedy, and inexpensive determination of civil disputes ... by encouraging full disclosure of all evidence that might conceivably be relevant”) (citation omitted).
The permissible scope of discovery in the federal courts is very broad: “Parties may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party.” Fed.R.Civ.P. 26(b)(1). Much of the material produced in discovery is neither incorporated in motions made to the court nor admissible at trial. In order to mitigate the substantial risk to litigants’ privacy and other rights posed by the expansive scope of pretrial discovery, courts are giv
*415
en broad discretion in Rule 26(c) to craft sealing orders “which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense.” Fed.R.Civ.P. 26(c); Part II.B.l,
supra; see also
Fed.R.Civ.P. 26 comment (“The information explosion of recent decades has greatly increased ... the potential for discovery to be used as an instrument for delay or oppression.”).
Rule 26(c) provides a non-exhaustive list of eight types of protective orders that courts may issue.
See
Fed. R.Civ.P. 26(e)(1) — (c)(8). “[A] court is not limited to the eight specified types of orders .... [it] may be as inventive as the necessities of a particular case require in order to achieve the benign purposes of the rule.” 8 Chaires A. Wright, Arthur R. Miller & Richard L. Marcus at § 2086;
see also Ann L. v. X Corp.,
138 F.R.D. 433, 435 (W.D.N.Y.1990) (“an order of suppression is a permissible remedy under the ‘catch all clause’ of Fed.R.Civ.P. 26(c)”). “Rule 26(c) confers broad discretion on the trial court to decide when a protective order is appropriate and what degree of protection is required.”
Seattle Times,
467 U.S. at 36 , 104 S.Ct. 2199 . The touchstone of the court’s power under Rule 26(c) is the requirement of “good cause.” The burden to establish good cause is placed on the party seeking protection.
See
8 Wright & Miller at § 2035.
To determine whether good cause exists, courts balance “the need for information against the injury that might result if uncontrolled disclosure is compelled.”
See Pansy,
23 F.3d at 787
(quoting
Miller,
Confidentiality).
Balancing requires taking into account litigants’ privacy rights as well as the general public’s interest in the information.
See TheStreet.com,
273 F.3d at 234. The balance struck should incorporate consideration of the overarching purpose of the discovery process: “Discovery involves the use of compulsory process to facilitate orderly preparation for trial, not to educate or titillate the public.”
Joy v. North,
692 F.2d 880, 893 (2d Cir.1982);
see also
Richard L. Marcus,
Myth and Reality in Protective Order Litigation,
69 Cornell L.Rev. 1, 57 (1983) (“The speculative possibility that in some cases the public would benefit from dissemination of information garnered through discovery hardly warrants the conversion of the process into an investigatory tool for inquisitive litigants.”).
b) Subsection 7
Subsection (7) of Rule 26(c) provides for the issuance of a protective order requiring “that a trade secret or other confidential research, development, or commercial information not be revealed or be revealed only in a designated way”. This “open-ended series of terms ... need not be limited to ‘true’ trade secrets.” 8 Wright & Miller at § 2043. “Documents falling into categories commonly sealed are those containing trade secrets, confidential research and development information, marketing plans, revenue information, pricing information, and the like.”
Cumberland Packing Corp. v. Monsanto Co.,
184 F.R.D. 504, 506 (E.D.N.Y.1999). Examples of protective orders covering commercial documents include:
Sullivan Mktg. v. Valassis Commc’ns,
1994 WL 177795 , 1994 U.S. Dist. LEXIS 5824 (S.D.N.Y.1994) (granting protective order to defendant publisher that restricted access to sensitive business contracts, proposals and negotiations);
Moore U.S.A., Inc. & Toppan Forms Co., Ltd. v. Standard Register Co.,
2000 WL 876884 , 2000 U.S. Dist. LEXIS 9137 (W.D.N.Y.2000) (protecting documents containing trade secrets and confidential research and development information);
Vesta Corset Co. v. Carmen Founds.,
1999 WL 13257 , *2, 1999 U.S. Dist. LEXIS 124 , at *5 (S.D.N.Y.1999) (refusing disclosure of confidential commer
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cial information such as “pricing, profits, costs, overhead, manufacturing specifications, customer lists, price structure, and dealings with a common customer”);
DDS, Inc. v. Lucas Aero. Power Transmission Corp.,
182 F.R.D. 1 (N.D.N.Y.1998) (protecting trade secrets of manufacturing process and customer lists, and breakdown of annual sales figures).
S. Umbrella Protective Orders
In large complex cases, courts often enter “umbrella” protective orders, which permit parties to designate in advance a large volume of discovery material as confidential.
See
Campbell,
Protective Order, supra
at 777-79 (“The use of umbrella orders in complex litigation has become commonplace.”);
Pansy,
23 F.3d at 787 n. 17 (“[B]ecause of the benefits of umbrella protective orders in cases involving large-scale discovery, the court may construct a broad umbrella protective order upon a threshold showing by the mov-ant of good cause”). Parties are permitted to challenge that designation, and the burden of establishing that there is good cause to protect the designated materials rests at all times with the party seeking protection.
In complicated mass cases the use of umbrella protective orders is recommended by the Manual for Complex Litigation:
When the volume of potentially protected materials is large, an umbrella order will expedite production, reduce costs, and avoid the burden on the court of document-by-document adjudication. Umbrella orders provide that all assert-edly confidential material disclosed (and appropriately identified, usually by a stamp) is presumptively protected unless challenged. Such orders typically are made without a particularized showing to support the claim for protection, but such a showing must be made whenever a claim under an order is challenged.
Manual for Complex Litigation, § 11.423 (4th ed.2004).
The value of umbrella orders has been well-documented:
[T]he propriety and desirability of protective orders securing the confidentiality of documents containing sensitive commercial information that are the subject of discovery in complex cases is too well established to belabor.... We are unaware of any case in the past half-dozen years of even a modicum of complexity where an umbrella protective order ... has not been agreed to by the parties and approved by the court.
Zenith Radio Corp. v. Matsushita Elec. Indus. Co.,
529 F.Supp. 866, 889 (E.D.Pa.1981). See also 8 Wright & Miller at § 2035.
k- First Amendment Implications of Protective Orders
The leading Supreme Court case addressing the question of how the First Amendment’s protection of speech applies to protective orders is
Seattle Times Co. v. Rhinehart,
467 U.S. 20 , 104 S.Ct. 2199 , 81 L.Ed.2d 17 (1984);
see also
Part III.D.4,
infra.
During discovery in a state court action against a newspaper for defamation, the defendant requested the production of documents relating to the financial affairs of the plaintiff and his religious organization.
Id.
at 23-25 , 104 S.Ct. 2199 . Plaintiffs sought a protective order for the financial documents to limit their publication and dissemination by the newspaper.
Id.
at 25 , 104 S.Ct. 2199 .
The trial court entered a protective order prohibiting defendant “from publishing, disseminating, or using the information [produced by plaintiffs] in any way except where necessary to prepare for and try the case.”
Id.
at 27 , 104 S.Ct. 2199 .
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Upholding the order, the Supreme Court of Washington declared: “the information to be discovered concerned the financial affairs of the plaintiff ... in which he and his associates had a recognizable privacy interest ... and the giving of publicity to these matters would allegedly and understandably result in annoyance, embarrassment and even oppression.”
Id.
at 28 , 104 S.Ct. 2199 (quotation and citation omitted).
In an appeal to the United States Supreme Court, the Seattle Times argued that the protective order contravened rights under the First Amendment:
Petitioners argue that the First Amendment imposes strict limits on the availability of any judicial order that has the effect of restricting expression. They contend that civil discovery is not different from other sources of information, and that therefore the information is ‘protected speech’ for First Amendment purposes. Petitioners assert the right in this case to disseminate any information gained through discovery.... They submit [that] [w]hen a protective order seeks to limit expression, it may do so only if the proponent shows a compelling government interest.
Id.
at 30-31 , 104 S.Ct. 2199 (quotation omitted). Responding, the Court acknowledged that most information obtained in civil discovery would rarely fall into the classes of speech unprotected by the First Amendment, such as obscenity, defamatory statements, threats, and the like.
Id.
at 31 , 104 S.Ct. 2199 . Yet, it wrote, it “does not necessarily follow ... that a litigant has an unrestrained right to disseminate information that has been obtained through pretrial discovery.”
Id.
Rejected by the unanimous Court was the contention that information obtained through civil discovery is no different from information obtained through other means:
As in all civil litigation, petitioners gained the information they wish to disseminate only by virtue of the trial court’s discovery processes. As the Rules authorizing discovery were adopted by the state legislature, the processes thereunder are a matter of legislative grace. A litigant has no First Amendment right of access to information made available only for purposes of trying his suit.
Id.
at 32 , 104 S.Ct. 2199 ; see also
Zemel v. Rusk,
381 U.S. 1, 16-17 , 85 S.Ct. 1271 , 14 L.Ed.2d 179 (1965) (“The right to speak and publish does not carry with it the unrestrained right to gather information.”).
Protective orders prohibiting dissemination of materials discovered before trial are “not the kind of classic prior restraint that require[ ] exacting First Amendment scrutiny.”
Seattle Times
at 33, 104 S.Ct. 2199. The type of restrictions deemed permissible are those that apply to information obtained through the civil discovery process. While parties may be restrained from disseminating information obtained through the discovery mechanism, they “may disseminate the identical information ... as long as the information is gained through means independent of the court’s processes.”
Id.
at 34 , 104 S.Ct. 2199 .
C. Court Authority to Enforce Orders
1. Generally
Courts have the inherent authority to enforce their orders. “[T]he power of a court to make an order carries with it the equal power to punish for a disobedience of that order.”
In re Debs,
158 U.S. 564, 594 , 15 S.Ct. 900 , 39 L.Ed. 1092 (1895);
see also In re Lafayette Radio Elec. Corp.,
761 F.2d 84, 93 (2d Cir.1985) (“ancillary jurisdiction is recognized as part of a court’s inherent power to prevent its judgments and orders from being ignored or avoided with impunity”). The
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power is a necessary prerequisite to the administration of justice; without it, courts would be ill-equipped to ensure the rule of law in a democratic society.
“It is one of the equitable powers, inherent in every court of justice so long as it retains control of the subject-matter and of the parties, to correct that which has been wrongfully done by virtue of its process.”
See Arkadelphia Milling Co. v. St. Louis Sw. Ry. Co.,
249 U.S. 134, 146 , 39 S.Ct. 237 , 63 L.Ed. 517 (1919);
see generally Anderson v. Dunn,
19 U.S. 204 , 6 Wheat. 204, 227 , 5 L.Ed. 242 (1821) (“Courts of justice are universally acknowledged to be vested, by their very creation, with power to impose ... submission to their lawful mandates”);
In re Lafayette Radio,
761 F.2d at 92 (“it is established that a federal court sitting in equity that has jurisdiction to issue a decree necessarily has ancillary and supplemental jurisdiction to enter orders and judgments designed to effectuate that decree”).
2.
National Scope
The jurisdiction of a court to enforce its orders extends nationwide. “Nonparties who reside outside the territorial jurisdiction of a district court may be subject to that court’s jurisdiction if, with actual notice of the court’s order, they actively aid and abet a party in violating that order.”
Waffenschmidt v. MacKay,
763 F.2d 711, 714 (5th Cir.1985);
see also Stiller v. Hardman,
324 F.2d 626, 628 (2d Cir.1963) (“Violation of an injunctive order is cognizable in the court which issued the injunction, regardless of where the violation occurred.”).
D. Injunctions
1. Generally
The authority to issue injunctions is derived from the courts’ inherent equity powers and Rule 65 of the Federal Rules of Civil Procedure. “In most cases the determination whether to issue an injunction involves a balancing of the interests of the parties who might be affected by the court’s decision — the hardship on plaintiff if relief is denied as compared to the hardship to defendant if relief is granted.” 11A Charles A. Wright, Arthur R. Miller & Mary Kay Kane at § 2942. Decision as to whether an injunction is warranted on the facts of a particular case is committed to the sound discretion of the trial court.
See id.; Lemon v. Kurtzman,
411 U.S. 192, 200 , 93 S.Ct. 1463 , 36 L.Ed.2d 151 (1973) (“In shaping equity decrees, the trial court is vested with broad discretionary power”).
At common law, chancery courts in England provided extraordinary relief such as injunctions and specific performance only when the parties could not obtain an effective remedy from the courts of law. 11A Wright & Miller at § 2944; McClintock, Equity, § 21 (2d ed.1948). “Even though there no longer are separate law and equity courts ... injunctive relief continues to be viewed as ‘extraordinary’ and courts are reluctant to award it if the claimant can secure adequate rectification of his grievance by an award of damages.”
Id.
“[IJnjunctive relief should be no more burdensome to the defendant than necessary to provide complete relief to the plaintiffs.”
Califano v. Yamasaki,
442 U.S. 682, 702 , 99 S.Ct. 2545 , 61 L.Ed.2d 176 (1979). “A plaintiff seeking an injunction must show that there is an imminent threat of harm and that the threatened harm is ‘irreparable.’” Owen Fiss, Injunctions 59 (2d ed.1984).
2. Persons Bound
Rule 65(d) of the Federal Rules of Civil Procedure provides that an injunction “is binding only upon the parties to the action, their officers, agents, servants, employees, and attorneys, and upon those persons in
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active concert or participation with them who receive actual notice of the order by personal service or otherwise.” Fed.R.Civ.P. 65(d). The rule “is derived from the common law doctrine that a decree of injunction not only binds the parties defendant but also those identified with them in interest, in ‘privity’ with them, represented by them, or subject to their control. In essence it is that [persons bound] may not nullify a decree by carrying out prohibited acts through aiders and abettors, although they were not parties to the original proceeding.”
Regal Knitwear Co. v. Nat’l Labor Relations Bd.,
324 U.S. 9, 14 , 65 S.Ct. 478 , 89 L.Ed. 661 (1945).
See, e.g.,
2 Wayne R. LaFave, Substantive Criminal Law, § 13.2(a) (2d ed.2003) (discussing criteria for aiding and abetting);
id.
§ 13.2(b) at 344; 4 Wharton’s Criminal Law § 685 (15th ed.1996) (same).
“[A]n issue of privity in the context of determining who is bound by an injunction ... in a particular case is often not easy to resolve.” 11A Wright & Miller at § 2956. A fact-sensitive inquiry must be undertaken to determine whether persons not named in an injunction can be bound by its terms because they are acting in concert with an enjoined party.
Id.; Vuitton et Fils S.A. v. Carousel Handbags,
592 F.2d 126, 130 (2d Cir.1979) (“Whether one not named in an injunctive decree may nevertheless be bound by it depends on the facts of each case.”).
Those persons named in an injunction are considered “parties” for the purpose of Rule 65(d).
See Madsen v. Women’s Health Ctr., Inc.
512 U.S. 753, 775 , 114 S.Ct. 2516 , 129 L.Ed.2d 593 (1994). The party seeking enforcement of an injunction against persons not named bears the burden of demonstrating that those persons are bound by the order.
See People of the State of N.Y. by Vacco v. Operation Rescue Nat’l,
80 F.3d 64 , 70 (2d Cir.1996).
3. Enjoining Dissemination of Stolen Protected Documents
Recovering stolen documents obtained in violation of a court discovery order when needed to protect a party to a litigation is well within the equitable power of a federal district court.
See
28 U.S.C. § 1651 (a) (district courts “may issue all writs necessary or appropriate in aid of their ... jurisdiction and agreeable to the usages and principles of law”);
Egri v. Conn. Yankee Atomic Power Co.,
68 Fed.Appx. 249, 255-56 (2d Cir.2003) (finding injunction enforcing protective order permissible under the All Writs Act) (unpublished opinion); Fed.R.Civ.P. 16(f) (failure to obey a pretrial order);
see generally
Part III.C,
supra.
Even if the order were improperly issued, it must be modified or overturned and not deliberately violated when in force.
See, e.g., Walker v. City of Birmingham,
388 U.S. 307, 321 , 87 S.Ct. 1824 , 18 L.Ed.2d 1210 (1967) (“One may sympathize with the petitioners’ impatient commitment to their cause. But respect for judicial process is a small price to pay for the civilizing hand of law, which alone can give abiding meaning to constitutional freedom.”).
The Supreme Court, in
Bartnicki v. Vopper,
532 U.S. 514 , 121 S.Ct. 1753 , 149 L.Ed.2d 787 (2001), provided some guidance on the right to publish material of public significance illegally obtained by a third party.
See also
Part III.B.4,
supra,
on First Amendment implications of protective orders A cell phone conversation had been illegally intercepted by private parties in violation of a state wiretapping statute, and then turned over to a third person who published it. The third person was considered to be in legal possession of the recorded conversation.
The Court held unconstitutional as applied state legislation prohibiting intentional disclosure of the illegally intercepted
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communication by the third person. The majority emphasized its reluctance to definitively answer “the question whether, in cases where information has been acquired
unlawfully
by a newspaper ... government may ever punish not only the unlawful acquisition, but the ensuing publication as well.”
Id.
at 528-29, 121 S.Ct. 1753 (internal quotation and citation omitted) (emphasis in original). It listed some of the criteria it weighed in deciding to protect the third party’s publication: First, the third party played no part in the illegal interception, but found out about it “only after it occurred.”
Id.
at 525 , 121 S.Ct. 1753 . Second, access to the information was “lawfully” obtained by the third party even though the information itself was “unlawfully” obtained by another.
Id.
Third, the subject matter was a matter of public concern.
I. Content Neutral
Supporting the power to prevent publication in
Bartnicki
was the injunction’s “content neutral” form.
Id.
at 525-29 , 121 S.Ct. 1753 .
Applicability of the First Amendment to an injunction generally depends upon whether any restriction on speech it contains is “content-based” or “content-neutral.”
See Universal City Studios, Inc. v. Corley,
273 F.3d 429, 450 (2d Cir.2001). In an assessment of content-neutrality, “[t]he government’s purpose is the controlling consideration. A regulation that serves purposes unrelated to the content of expression is deemed neutral, even if it has an incidental effect on some speakers or messages but not others.”
Ward v. Rock Against Racism,
491 U.S. 781, 791 , 109 S.Ct. 2746 , 105 L.Ed.2d 661 (1989);
see also R.A.V. v. St. Paul,
505 U.S. 377, 386 , 112 S.Ct. 2538 , 120 L.Ed.2d 305 (1992) (“The government may not- regulate [speech] based on hostility — or favoritism — towards the underlying message expressed.”).
The Court of Appeals for the Second Circuit has defined as content-neutral those regulations that do “not depend on the nature or content of the idea that [a person] wishes to express but only on the materials that would be the medium of expression.”
Lindsey v. Bloomberg,
476 F.3d 74 , 84 (2d Cir.2007);
see also Ward v. Rock Against Racism,
491 U.S. 781, 791 , 109 S.Ct. 2746 , 105 L.Ed.2d 661 (1989) (“Government regulation of expressive activity is content neutral so long as it is justified without reference to the content of the regulated speech.”) (emphasis and internal quotation marks omitted).
Injunctions “issued not because of the content of petitioners’ expression ... but because of ... prior unlawful conduct” are content neutral.
Madsen v. Women’s Health Ctr., Inc.,
512 U.S. 753, 764-65 , 114 S.Ct. 2516 , 129 L.Ed.2d 593 (1994). Content neutral injunctions must “burden no more speech than necessary to serve a significant government interest,”
Madsen,
512 U.S. at 765 , 114 S.Ct. 2516 , but they are not required to “employ the least restrictive means of accomplishing the governmental objective.”
Universal City Studios,
273 F.3d at 455 . Because such injunctions do not enjoin speech based on its content, they do “not arouse the fears that trigger the application of constitutional ‘prior restraint’ principles.”
Dallas Cowboys Cheerleaders, Inc. v. Pussycat Cinema, Ltd.,
604 F.2d 200, 206 (2d Cir.1979).
“The First Amendment does not prohibit courts from incidentally enjoining speech in order to protect a legitimate property right.”
DVD Copy Control Ass’n Inc. v. Bunner,
31 Cal.4th 864, 881 , 4 Cal.Rptr.3d 69 , 75 P.3d 1 ;
see also Dallas Cowboys,
604 F.2d at 206 (“This is not a case of government censorship, but a private
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plaintiffs attempt to protect its property rights.”)- “The mere fact that [one] claims an expressive ... purpose ... does not give [one] a right, under the First Amendment to the United States Constitution, to appropriate to [oneself] the harvest of those who have sown.”
San Francisco Arts & Ath., Inc. V..U.S. Olympic Comm.,
483 U.S. 522, 526 , 107 S.Ct. 2971 , 97 L.Ed.2d 427 (1987) (quotation and citation omitted).
IV. Application of Law to Facts
A. The Documents are Properly Protected Under CMOS
1. CMOS is a Valid Umbrella Protective Order
CMO-3 is an umbrella protective order which permits parties to designate as confidential materials that they “in good faith believe[ ][are] properly protected under Federal Rule of Civil Procedure 26(c)(7).” CMO-3 at ¶ 3. The designation of a document as “confidential” can be challenged by an opposing party, or any aggrieved entity, and the burden of establishing confidentiality rests on the producing party.
Id.
at ¶ 9. The use of such umbrella orders, which allow parties to designate substantial volumes of discovery materials as confidential upon a threshold showing of good cause, is permitted in large complex litigations, such as the instant multidistrict litigation consisting of thousands of cases.
See
Manual for Complex Litigation, § 11.423;
Pansy v. Borough of Stroudsburg,
23 F.3d 772 , 787 n. 17 (3d Cir.1994); Part III.B.3,
supra.
2. Documents Contain Information Protectable by CMOS and Rule 26(c)
The sealed documents disseminated by Gottstein and his co-conspirators consist entirely of materials that were exchanged by the parties in the discovery phase of this litigation. For purposes of the presumption to public access, they play no role in the adjudication process.
See United States v. Amodeo,
71 F.3d 1044, 1050 (2d Cir.1995);
F.T.C. v. Standard Fin. Mgmt. Corp.,
830 F.2d 404, 409 (1st Cir.1987). See Part III.A, supra.
This case is distinguishable from
Procter & Gamble Co. v. Bankers Trust Co.,
78 F.3d 219 (6th Cir.1996), relied upon by respondents. In
Procter & Gamble,
an injunction prohibiting publication of “standard litigation filings” — consisting of a memorandum of law, complaint, and case statement — , rather than documents produced in discovery and not relied upon by the court, was overturned.
Procter & Gamble
at 222, 225.
In this litigation, a substantial amount of sensitive material, including medical records and trade and proprietary information, has been produced for discovery purposes in accordance with Rule 26(b)(l)’s relatively low threshold of relevance to any claim or defense.
See
Part III.B.l,
supra.
Such information is not generally appropriate for public consumption. The court entered its protective order covering confidential materials under both its general equitable powers and the authority granted by Rule 26(c). The order was essential to protecting litigants from the embarrassment and oppression that would result from unnecessary pretrial public disclosure of their private information.
The court’s review of a sample of the documents disseminated by the conspirators in violation of CMO-3 as well as the articles in the New York Times provide clear and convincing evidence that they contain information properly protected as confidential under Rule 26(c).
See
Part II.H.2,
supra.
They consist mainly of trade secrets and confidential commercial information of defendant Lilly; revelation has the potential to impinge on the company’s privacy and property rights and inflict
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commercial harm.
See
Fed.R.Civ.P. 26(c)(7) (permitting protective orders that seal1 “trade secret or other confidential information”);
Cumberland Packing Corp. v. Monsanto Co.,
184 F.R.D. 504, 506 (E.D.N.Y.1999) (“Documents falling into categories commonly sealed are those containing trade secrets, confidential research and development information, marketing plans, revenue information, pricing information, and the like.”); see, e.g.,
Gelb v. American Tel. & Tel. Co.,
813 F.Supp. 1022, 1035 (S.D.N.Y.1993) (sealing internal documents which “constitute potential negative publicity about [defendant’s] marketing tactics” because of “their potential to do commercial harm”).
Any person, whether or not a party to this litigation, who believes documents designated as confidential under CMO-3 have been improperly sealed or should be disclosed in the public interest may take advantage of the order’s declassification provisions and petition the court for declassification of certain documents.
See
CMO-3 at ¶ 9;
see also id.
at ¶ ^(“Nothing in this Order shall prevent any party or other person from seeking modification of this Order or from objecting to discovery that it believes to be otherwise improper.”).
B. Court has the Power to Order Return of Stolen Documents
A large number of documents sealed by the court have been obtained illegally by the conspirators and those to whom they sent the documents.
See
Part II.H,
supra.
These confidential documents were procured solely by use of the court’s discovery process; there has been no suggestion that anyone was able to retrieve them from any other source before revelation by the three conspirators— Berenson, Egilman, and Gottstein.
See Int’l Prods. Corp. v. Koons,
325 F.2d 403 , 407-08 (2d Cir.1963).
As in all civil litigation, [respondents] gained the information they wish to disseminate only by virtue of the trial court’s discovery processes. As the Rules authorizing discovery were adopted by the [federal] legislature, the processes thereunder are a matter of legislative grace. A-litigant has no First Amendment right of access to information made available only for purposes of trying his suit.
Seattle Times Co. v. Rhinehart,
467 U.S. 20, 32 , 104 S.Ct. 2199 , 81 L.Ed.2d 17 (1984). Respondents here have no right to possession of the confidential documents given to them by the conspirators. Cf. Restatement (First) of Torts § 757, Liability for Disclosure or Use of Another’s Trade Secret (1939; current through Sept. 2006) (“One who discloses or uses another’s trade secret, without a privilege to do so, is liable to the other if (a) he discovered the secret by improper means, or (b) his disclosure or use constitutes a breach of confidence reposed in him by the other in disclosing the secret to him, or (c) he learned the secret from a third person with notice of the facts that it was a secret and that the third person discovered it by improper means or that the third person’s disclosure of it was otherwise a breach of his duty to the other ... ”);
Conmar Prods. Corp. v. Universal Slide Fastener Co.,
172 F.2d 150, 155-56 (2d Cir.1949).
“It is one of the equitable powers, inherent in every court of justice so long as it retains control of the subject matter and of the parties, to correct that which has been wrongfully done by virtue of its process.”
Arkadelphia Milling Co. v. St. Louis Sw. Ry. Co.,
249 U.S. 134, 145-46 , 39 S.Ct. 237 , 63 L.Ed. 517 (1919). This power encompasses the authority to order the return of the documents stolen by the conspirators in violation of the protective order.
See generally Anderson v. Dunn,
19 U.S. 204 , 6 Wheat. 204, 227 , 5 L.Ed. 242 (1821)
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(“Courts of justice are universally acknowledged to be vested, by their very creation, with power to impose ... submission to their lawful mandates.”);
In re Lafayette Radio Elec. Corp.,
761 F.2d 84, 92 (2d Cir.1985) (“it is established that a federal court sitting in equity that has jurisdiction to issue a decree necessarily has ancillary and supplemental jurisdiction to enter orders and judgments designed to effectuate that decree”);
see also Egri v. Conn. Yankee Atomic Power Co.,
68 Fed.Appx. 249, 255-56 (2d Cir.2003) (“Pursuant to the All Writs Act, a district court is authorized to bind non-parties where such action is necessary to preserve its ability to adjudicate proceedings already before it or to enforce its own prior decisions”) (unpublished opinion).
C. Restrictions on Dissemination Do Not Violate First Amendment Rights
1. CMOS’s Restriction on Dissemination of Confidential Documents Does Not Implicate First Amendment Rights
CMO-3’s restriction on dissemination of confidential materials produced in discovery does not implicate the parties’ freedom of speech; “[a] litigant has no First Amendment right of access to information made available only for purposes of trying his suit.”
Id.
at 32. Litigants do not have “an unrestrained right to disseminate information that has been obtained through pretrial discovery.”
Seattle Times Co. v. Rhinehart,
467 U.S. 20, 31 , 104 S.Ct. 2199 , 81 L.Ed.2d 17 (1984).
Nonparties who are prohibited from accessing confidential documents by CMO-3 cannot claim an infringement on their freedom of speech: “The right to speak and publish does not carry with it the unrestrained right to gather information.”
Zemel v. Rusk,
381 U.S. 1, 16-17 , 85 S.Ct. 1271 , 14 L.Ed.2d 179 (1965);
see also Joy v. North,
692 F.2d 880, 893 (2d Cir.1982) (“Discovery involves the use of compulsory process to facilitate orderly preparation for trial, not to educate or titillate the public.”). Those who can demonstrate a substantial need to know information contained in confidential documents must utilize CMO-3’s declassification provisions.
See
CMO-3 at ¶ 9;
see also In re Agent Orange Prod. Liab. Litig.,
104 F.R.D. 559, 572 (E.D.N.Y.1985) (declassifying documents upon a showing “that the need for disclosure outweighs the need for further protection”),
aff'd
821 F.2d 139 (2d Cir.1987).
2. The Injunction’s Restriction on Dissemination Does Not Impinge on First Amendment Rights
The instant injunction prohibiting further dissemination of confidential documents is content neutral. Its restriction does “not depend on the nature of the content of the idea that [the enjoined individuals wish] to express but only on the materials that would be the medium of expression.”
Lindsey v. Bloomberg,
476 F.3d at 84-85 (2d Cir.2007). The injunction is justified not by reference to the content of the covered documents, but rather by their unlawful acquisition.
See Madsen v. Women’s Health Ctr., Inc.,
512 U.S. 753, 764-65 , 114 S.Ct. 2516 , 129 L.Ed.2d 593 (1994) (holding injunctions “issued not because of the content of petitioners’ expression ... but because of their prior unlawful conduct” are content neutral).
Only a minimal burden on speech results from the instant injunction since it restricts dissemination of documents only if those documents were obtained in the first instance by use of the court’s processes. It does not restrict anyone from discussing any topic or publishing or expressing any opinion. It is content neutral and does not
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“burden ... speech [more] than necessary to serve a significant government interest.”
Madsen
at 765, 114 S.Ct. 2516 . While the court is not required to “employ the least restrictive means of accomplishing the governmental objective,” the injunction here is the least restrictive practicable method available to protect Lilly, the plaintiffs, and the court.
Universal City Studios, Inc., v. Corley,
273 F.3d 429, 455 (2d Cir.2001).
Several important governmental interests are served by this injunction. It allows the court to protect the privacy and property rights of litigants appearing before it, which is essential to a fair and efficient system of adjudication. By prohibiting dissemination in violation of the court order the court’s ability to enforce its own orders is preserved. Many of the protected documents contain trade secrets and commercial information, whose privacy the government has a stake in maintaining: “Trade secret law promotes the sharing of knowledge and the efficient operation of industry.”
See DVD Copy Control Ass’n v. Bunner,
31 Cal.4th 864, 878 , 4 Cal.Rptr.3d 69 , 75 P.3d 1 (Cal.2003) (discussing “governmental purpose behind protecting trade secrets”).
Respondents’ claims that the injunction represents an impermissible prior restraint are without merit. Content neutral injunctions such as the present one do “not arouse the fears that trigger the application of constitutional prior restraint principles.”
Dallas Cowboys Cheerleaders, Inc. v. Pussycat Cinema, Ltd.,
604 F.2d 200, 206 (2d Cir.1979).
The instant case is readily distinguishable the Sixth Circuit Court of Appeals’ decision primarily relied upon by respondents,
Procter & Gamble v. Bankers Trust, supra.
In
Procter & Gamble,
the court held an injunction prohibiting a news magazine from publishing litigation filings that had been improperly sealed in the first instance to be an impermissible infringement upon First Amendment rights.
Procter & Gamble,
78 F.3d at 225 . Here, the documents at issue are not litigation filings, but documents produced in discovery, to which the right of public access has not attached.
See
Parts III.A and IV.A,
supra; Procter & Gamble,
78 F.3d at 225 (“the documents in question are standard litigation filings”). The documents were never unsealed under CMO-3, unlike the filings at issue in
Procter & Gamble,
which were unsealed at the time the district court granted the injunction.
See
Parts II.H.2 and IV.A,
supra; Procter & Gamble,
78 F.3d at 223, 223 (“the District Court determined that, because the parties could not provide a substantial government interest in keeping the documents confidential, the sealed documents should no longer be protected and should be released into the public domain”) (quotation marks omitted). Finally, the enjoined party in
Procter & Gamble
was a member of the media, Business Week magazine.
See id.
at 225 . (describing the overturned injunction as part of “a practice that, under all but the most exceptional circumstances, violates the Constitution: preventing a
news organization
from publishing information in its possession on a
matter of public concern”)
(emphasis supplied). The enjoined persons here are private, nonmedia-eon-nected individuals.
The injunction here is content neutral, places only a minimal burden on speech, and serves significant government interests. It does not restrict freedom of speech under the First Amendment.
D. Enjoining Persons Who Refuse to Return the Documents is Necessary to Prevent Irreparable Harm to Lilly
Disclosure of confidential proprietary material and trade secrets poses a
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significant risk of harm to Lilly, a pharmaceutical company operating in a competitive marketplace. Both Lilly’s competitors’ and detractors’ use of the materials has the potential to inflict severe commercial harm on the company.
See
Dec’l of Gerald Hoffman, ¶ 18 (“If Lilly’s internal documents were to be publicly disseminated, every pharmaceutical company in the world, including competitors to all of Lilly’s marketed medications, including Zy-prexa, would have access to a treasure trove of competitive intelligence, in an organized and assembled manner.”). The disclosure of its trade secrets can be considered tantamount to appropriation of the company’s property.
See, e.g., Conmar Products Corp. v. Universal Slide Fastener Co.,
172 F.2d 150, 155 (2d Cir.1949) (finding trade secrets to be property).
The harm faced by Lilly is amplified by the fact that the protected documents which respondents seek to disseminate are segments of a large body of information, whose selective and out-of-context disclosure may lead to confusion in the patient community and undeserved reputational harm — “what appears damning may, in context after difficult proof, be shown to be neutral or even favorable to the defendant.” Note,
Secrecy in Civil Trials: Some Tentative Views,
9 J.L. & Pol’y 53, 58 (2000).
In granting this injunction, the court has balanced the harm to petitioner if relief is denied against the harm to respondents if relief is granted.
See generally
11A Wright
&
Miller at § 2942. The harm imposed by the injunction on respondents is minimal. They are required to return stolen documents over which they enjoy no property rights.
See
Part IV.B,
supra.
Their freedom of speech is not impinged upon.
See
Part IV.C,
supra.
To the extent they believe access to the protected documents is essential to their pursuit of the public interest, they may petition the court for declassification of the documents or modification of the protective order.
See
Part IV.C.l,
supra; see also Walker v. City of Birmingham,
388 U.S. 307, 321 , 87 S.Ct. 1824 , 18 L.Ed.2d 1210 (1967) (“One may sympathize with the petitioners’ impatient commitment to their cause. But respect for judicial process is a small price to pay for the civilizing hand of law, which alone can give abiding meaning to constitutional freedom.”).
Some of the individuals who have thus far refused to comply with requests to return the stolen documents have shown a resolute desire to flout court orders and inflict economic and reputational harm on Lilly. If not enjoined, it is highly probable that these individuals will widely disseminate the documents they know to be protected by a court order, in a form unnecessarily damaging to Lilly.
See, e.g.,
Tr. at 48-49, 193-94; Part II.K.4,
supra.
The injunction against them is therefore necessary to prevent irreparable harm to Lilly.
E. Enjoining Persons Who Returned the Documents is Not Necessary to Prevent Irreparable Harm to Lilly
As discussed
supra
in Part IV.D, dissemination of its confidential documents poses a significant risk of harm to Lilly’s privacy, proprietary, and commercial interests. Nonetheless, those individuals who have returned the documents they received from the conspirators, and who have not themselves been implicated in the conspiracy, are unlikely to cause harm to Lilly.
It is not necessary in this case to burden respondents who have demonstrated compliance with and respect for court orders in order to prevent future harm to Lilly. An injunction should be no more burdensome to respondents than necessary to provide complete relief to petitioner.
See Califano v. Yamasaki,
442 U.S.
*426
682, 702, 99 S.Ct. 2545 , 61 L.Ed.2d 176 (1979). No individual who has returned the documents, and is not a member of the conspiracy to illegally procure the documents, is enjoined.
F. Websites Should Not Be Enjoined
A difficult issue is presented by Lilly’s request to enjoin certain websites from posting the confidential documents.
See
Part I,
supra.
The websites in question had posted or linked to the documents prior to being enjoined from doing so by the preliminary injunction of January 4, 2007. No site has violated the January 4th order.
A user of one of the enjoined websites, “John Doe”, has appeared in this action to contest the injunction’s applicability to him. The injunction has no application to him since he apparently received no documents from the conspirators.
Prohibiting five of the internet’s millions of websites from posting the documents will not substantially lower the risk of harm posed to Lilly. Websites are primarily fora for speech. Limiting the fora available to would-be disseminators by such an infinitesimal percentage would be a fruitless exercise of the court’s equitable power. A more effective use of the court’s equitable discretion is to impose restraints on the individuals who pose the greatest risk of harm to Lilly — those who have not returned the documents despite knowledge that they were illegally procured.
See
Part IV.D,
supra.
Mindful of the role of the internet as a major modern tool of free speech,
see
Part I
supra,
in the exercise of discretion the court refrains from permanently enjoining websites based on the insubstantial evidence of risk of irreparable harm. Restrictions on speech, even in the context of content-neutrality, should be avoided if not essential to promoting an important government interest. No website is enjoined from disseminating documents.
G. All Named Persons are Bound by the Injunction
The court’s power .is being exercised to enjoin all persons whose conduct poses a significant risk of irreparable harm to Lilly which cannot be remedied except by injunction.
See
Part III.D,
supra;
Note,
Developments in the Law: Injunctions,
78 Harv. L.Rev. 994 (1965).
Respondents place great emphasis on Judge Hand’s statement in
Alemite Mfg. Corp. v. Staff,
42 F.2d 832 (2d Cir.1930), that “the only occasion when a person not a party
may be punished,
is when he has helped bring about ... an act of a party [in violation of a prior court decree].”
Id.
at 832-33 (emphasis supplied). In
Alem-ite,
the Court of Appeals for the Second Circuit was considering an appeal from a conviction of contempt by an individual whose alleged violation of an injunction in which he had not been named formed the basis of the contempt proceeding.
Id.
at 832 .
Alemite
speaks to the question of who may be held in contempt for violating an injunction. See Developments in the Law: Injunctions, supra, at 1028-29. It does not bear on the question presented in this case of who the court may enjoin by name in the first instance. Unlike Alemite, this is not a contempt proceeding, and the court is not now punishing anyone for any alleged violation of court orders. Rather, this proceeding seeks to prevent irreparable harm to Lilly by enjoining those persons whose actions threaten such harm. See Owen Fiss, Injunctions, 109 (2d ed. 1984) (“The traditional office of an injunction is to prevent harm.”). The relief granted is not punitive, but preventative. See generally Part III.D.1, supra.
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The necessity of enjoining dissemination and requiring return of the sealed documents is not limited to those who were bound by the terms of CMO-3. The power to enjoin extends to persons and organizations whose activities present a risk of irreparable harm to petitioner that can not be alleviated by means other than injunction.
The parties to these injunction proceedings are the petitioner, Eli Lilly, and respondents, including James Gottstein, David Egilman, Dr. David Cohen, Judi Chamberlin, Vera Sharav, Robert Whitaker, Eric Whalen, and David Oaks.
See
Civil Docket for Case No. 1:07-CV00504-JBW-RLM. Even if the injunction proceedings are considered part of the more general series of actions, 04-MDL-01596, the respondents who are bound by this order have either been served or have appeared and should return documents illegally obtained that are in their possession. They cannot claim to be bona fide purchasers.
See
Part IV.B,
swpra.
The injunction issued here is binding on all persons named within it as well as “their officers, agents, servants, employees, and attorneys, and upon those persons in active concert or participation with them who receive actual notice of the order by personal service or otherwise.” Fed.R.Civ.P. 65(d).
See, e.g., Vuitton et Fils S.A. v. Carousel Handbags,
592 F.2d 126, 130 (2d Cir.1979) (“Whether one
not named
in an injunctive decree may nevertheless be bound by it is governed by Rule 65(d).”) (emphasis supplied).
H. Persons Bound
I. Recipients of Documents
Persons who received documents from Gottstein, but against whom Lilly is not seeking a permanent injunction, are: Alex Berenson (of The New York Times); Snighdha Prakash (of National Public Radio), Amelia Desanto, Steve Cha, Jerry Winchester, Dr. Grace Jackson, the Alliance for Human Research Protection, and MindFreedom International.
Persons and websites against whom Lilly seeks a permanent injunction are: Dr. Peter Breggin, Judi Chamberlin, Dr. David Cohen, Terri Gottstein, Will Hall, David Oaks, Vera Sharav, Eric Whalen, Robert Whitaker, Bruce Whittington, Laura Ziegler, zyprexa.pbwiki.com, www. mindfreedom.org, www.ahrp.org, www. ahrp.blogspot.org, and www.joysoup.net. The individuals named received the documents, but proof that the websites received the documents is lacking.
Persons who have returned the documents and need not be enjoined are: Dr. Peter Breggin, Steve Cha, Terri Gottstein, Will Hall, Dr. Grace Jackson, Dr. Stephen Kruszewski, Bruce Whittington, Jerry Winchester, and Laura Ziegler.
Persons who the evidence demonstrates received, but have not returned, the documents, and against whom Lilly is seeking a final injunction, are: Judi Chamberlin, Dr. David Cohen, David Oaks, Vera Sharav, Eric Whalen, and Robert Whitaker.
2. Amelia Desanto
Documents provided by Gottstein to Senate staffer Amelia Desanto have not been returned. Lilly has not sought an injunction against Desanto. Accordingly, and in light of the comity and respect due a coequal branch of government, Desanto is not enjoined.
S. N.Y. Times, National Public Radio, and Snighdha Prakash
No injunction has been sought against the New York Times. No showing has been made that any of its employees other than Berenson possessed the documents. No showing has been made that the Times knew they had been stolen. The reason
*428
ing applicable to the New York Times applies to National Public Radio.
Snighdha Prakash of National Public Radio is not enjoined because no injunction against her is sought. The New York Times and National Public Radio are not enjoined.
Ip. Berenson
While Berenson’s conduct in assisting in the stealing of the protected documents was reprehensible, Lilly has sought no injunction against him. Accordingly, Beren-son is not enjoined.
5. Gottstein and Egilman
Gottstein and Egilman have appeared by counsel in these proceedings and are therefore bound.
See
Tr. at 243, 252. Since their irresponsible conduct suggests further restraints to protect the parties and the court, they are included in this injunction.
6. Websites
For the reasons stated in Parts I and IV.F,
supra,
it is unlikely that the court can now effectively enforce an injunction against the internet in its various manifestations, and it would constitute a dubious manifestation of public policy were it to attempt to do so. No internet site is enjoined.
7. Persons Who Have Not Returned the Documents
The following individuals have been asked to return the documents they received from Gottstein to the Special Master, but have thus far failed to do so: Dr. David Cohen, Judi Chamberlin, Vera Sha-rav, Robert Whitaker and Eric Whalen. David Oaks is highly likely to have in his possession copies of the documents that he received directly or indirectly from Gott-stein, but he has not returned them. All persons listed in this paragraph are being ordered to return any copies of the documents in their possession to the Special Master immediately.
Se
e Part VIII,
infra.
The attorney for Vera Sharav, who is holding her copies of the documents, is considered to hold them on behalf of Ms. Sharav. He is bound to return them on her behalf.
Berenson, Snighdha Prakash and Amelia Desanto have also not returned the documents. The application of this order to Berenson is discussed in Part IV.H.4,
supra;
the application of this order to Snigh-dha Prakash is discussed in Part IV.H.3,
supra;
the application of this order to Amelia Desanto is discussed in Part IV. H.2,
supra.
8.Persons Restrained
Berenson’s, Egilman’s, and Gottstein’s brazen flouting of this court’s protective order raises serious questions about their responsibility. The court, based on the evidence before it, is not satisfied that they can be counted on to return all copies of the documents they may have in their possession or control. Egilman and Gott-stein are therefore being permanently enjoined as noted in Part TV.H.5,
supra.
Berenson is not being enjoined since no injunction against him has been sought by Lilly.
See
Part IV.H.4,
supra.
Those individuals who received documents and from whom Lilly seeks return but who have not returned them are ordered to return them.
See
Part IV.B.7,
supra.
Their disregard for the court’s processes poses a significant risk of irreparable harm to Lilly of further dissemination by them of protected documents. They are enjoined from further attempts at dissemination.
See
Part VIII,
infra.
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V.Findings of Fact and Law
A. Embodied in this Memorandum
This Memorandum and Order contains at various points the court’s findings of fact and law.
See, e.g.,
findings in Parts II and IV,
supra; see also
Fed.R.Civ.P. 65(d) (“Every order granting an injunction ... shall set forth the reasons for its issuance”); Fed R. Civ. P. 52(a).
Petitioner and respondents have submitted extensive formal findings of fact and law. The court sees no need to adopt them in view of this comprehensive memorandum.
B. Irreparable Harm to Lilly
Publication of the protected documents has already created irreparable harm to Lilly by revealing its trade secrets, confidential preliminary research, and merchandising techniques. It has made settlement of the remaining MDL and state cases and trials more difficult by creating probable prejudice largely irrelevant to the issues posed by the pending cases and by making impartial juror selection more difficult. It may have adversely affected prospective plaintiffs who may be less willing to sue if their intimate medical problems can be revealed through violation of the court’s protective orders. And, of course, flouting the court’s orders weakens the judicial structure.
As noted in Part IV.D,
supra,
there remains the substantial probability of further abuse of CMO-3 by the conspirators and individuals who have not returned the protected documents. This danger constitutes a continuous overhanging threat of harm which is likely to affect Lilly’s standing in the marketplace and the value of the corporation as a whole.
There has already been sufficient revelation in the New York Times so that if Congress, the Food and Drug Administration, or the Federal Trade Commission wish to investigate or act they have grounds for doing so, subpoenaing protected documents as necessary for their purposes.
C.Lack of Appreciable Harm to Those Bound
There is little or no harm to anyone bound by the injunction. None are harmed in their private person. To the extent that they wish to protect the public welfare by their revelation of protected documents, CMO-3 provides a vehicle for doing so.
See
Part IV.D,
supra.
D.Conclusion
The balance of benefits and harms leads overwhelmingly to support of the injunction now being issued.
See
Part IV.D,
supra.
VI. Conclusion
The preliminary injunction was justified. The references and restrictions upon various sites on the internet are not carried over to the final injunction in the exercise of discretion.
VII. Stay
This final judgment and injunction is stayed for ten days to permit an application to the Court of Appeals of the Second Circuit for reinstatement of this court’s order of January 4, 2007 including within a preliminary injunction various websites, or for other relief. The preliminary injunction shall remain in effect for ten days.
VIII. Injunction
It is hereby
ORDERED that the following individuals who have received documents produced by Eli Lilly and Company subject to CMO-3 (including all copies of any electronic documents, hard copy documents
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and CDs/DVDs) are enjoined from further disseminating these documents: Judi Chamberlin, Dr. David Cohen, David Egil-man, James Gottstein, David Oaks, Vera Sharav, Eric Whalen, and Robert Whitaker. He or she shall forthwith return any such documents and copies still in his or her possession or control to Peter Woo-din, Special Master for Discovery, at JAMS, 280 Park Avenue, West Building, 28th Floor, New York, N.Y. 10017.
SO ORDERED.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/2579789. Public record. Not legal advice.