In the case of Grunstein v. Silva, C.A. No. 3932-VCN (Del. Ch. July 2, 2012), the Court of Chancery analyzed Defendants’ request to de-designate hundreds of thousands of documents produced by Capital Funding Group (“CFG”), in a related Maryland action which were marked as “Highly Confidential”.  Specifically, CFG produced 5,000 pages of pleadings and Court filings in the Maryland action (the “Court Documents”), and another 238,000 pages of its own documents that it had already produced in the Maryland action (the “Discovery Documents”).  As a result of such designation, along with a highly restrictive certification that CFG required any attorney to make prior to reviewing such documents, only four attorneys at Dechert LLP, one of the law firms representing the defendants, have been allowed to view these documents.

The Court found that CFG’s Court Documents, documents created for the Maryland Action, have been designated Highly Confidential pursuant to an order entered by the Circuit Court of Maryland. 

The Court stated that it “is necessarily wary of de-designating documents as Highly Confidential when a court of another state, for which those documents were created, has given its imprimatur to the Highly Confidential designation.”  The Court found that there was not a unique set of facts in this case that would compel treading on the jurisdiction of another state’s court.

In connection with certain of the Discovery Documents, the Court held that CFG is to review within 30 days such documents, and determine in good faith whether such documents should continue to be marked as Highly Confidential.  With respect to certain other Discovery Documents, the Court found that defendants may request that CFG de-designate such documents that they believe in good faith is relevant and not entitled to Highly Confidential treatment.

As to the issue of what certification Dechert attorneys must give when reviewing the Maryland Documents, the Court adopted a more streamlined certification which related more specifically to the issues of the present case.