Anan Kasei Co., Ltd & Anor v Neo Chemicals & Oxides (Europe) Ltd & Anor

Confidentiality rings are exceptional restrictions on the ordinary disclosure regime. They require case-specific justification and careful judicial scrutiny, even where the parties agree their terms. An external-eyes-only arrangement, excluding every representative of the affected party, requires particularly clear and cogent justification. The limited size of the confidential material is irrelevant, and the fact that access may be unnecessary “for now” is insufficient. The burden lies on the party seeking the restriction. Where a party seeks admission of a particular representative, the court should be slow to second-guess that choice, while retaining scrutiny directed to fairness. The representative’s role, ability to give instructions, understanding of confidentiality obligations and the risk of misuse must be balanced.

The defendants applied for an order permitting Kevin Morris, their chief operating officer and a qualified non-practising lawyer, to see confidential material disclosed by the claimants in an inquiry as to damages. The claimants accepted access by the defendants’ lawyers and experts but sought an external-eyes-only ring, or alternatively the admission of another representative. The material was relevant to the claimants’ loss-of-profits case. The central issues were whether the ring should exclude the defendants entirely and whether Mr Morris should be admitted.

The proceedings followed an earlier liability trial in which the patent was held valid and infringed, with the appeal dismissed.

1. Application granted. The court permitted Kevin Morris to receive the confidential witness statement and confidential annex under the confidentiality-ring undertakings.
2. Confidentiality rings are derogations from the ordinary disclosure regime under Civil Procedure Rules 1998, rule 31.22. They may resemble a closed-material procedure and therefore require careful scrutiny, including where the parties agree the arrangement. The court must be satisfied that the restriction is appropriate in the circumstances of the case.
3. An external-eyes-only ring is exceptional. The party seeking to exclude the opposing party’s representatives bears the burden of showing clear and cogent justification. The limited quantity of the material does not justify exclusion: a single page may be highly material. Nor is it sufficient to say that a client may need access later rather than immediately. If lawyers and experts need the material, they will ordinarily need to obtain instructions from the client.
4. In deciding whether a particular representative should be admitted, the court should be slow to second-guess the party’s choice. That does not remove judicial scrutiny. Fairness remains the touchstone. Relevant considerations included Mr Morris’s operational role, his ability to instruct lawyers and inform the defence and settlement decisions, his legal qualification, his willingness to give undertakings, and the risk that confidential information might inadvertently affect conduct outside the litigation.
5. The risk of inadvertent misuse was serious but was outweighed by the practical need for Mr Morris to participate and his ability to understand and observe the undertaking to use the documents only for these proceedings. The claimants’ broader allegations about his past conduct were given no weight.

The judgment records that Mr Roger Wyand QC held, on 23 April 2018, that the patent was valid and infringed. An appeal from that liability judgment was dismissed. No citations for those decisions are stated.