Opinion
No. 04 Civ. 1758 (JSR).
January 15, 2005
MEMORANDUM ORDER
By Order dated January 8, 2005, the Court denied the motion of non-parties Stolt-Nielsen S.A., et al. (collectively, "Stolt-Nielsen") for a confidentiality order and the motion of claimants Celanese Ltd., et al., for an order holding Stolt-Nielsen in contempt. This Memorandum Order confirms those rulings and briefly sets forth the reasons therefor.
Claimants previously moved this Court to compel Stolt-Nielsen to comply with arbitration subpoenas requiring Stolt-Nielsen's custodians of records to appear before the arbitration panel, testify, and produce certain documents. As part of its opposition to that motion, Stolt-Nielsen raised concerns about confidentiality. In its orders of December 7 and December 18, 2004 granting claimants' motion, the Court, noting that the arbitration panel had already promised to consider these concerns, directed Stolt-Nielsen to present these concerns to the arbitration panel in the first instance. See Memorandum Order, December 18, 2004, at 7; see also Letter from John J. Gibbons to Karie Jo Barwind, July 22, 2004, attached as Ex. H to Declaration of Peter J. Carney, December 31, 2004 ("Carney Decl.").
In compliance with this direction, Stolt-Nielsen then raised its current concerns about confidentiality with the arbitration panel. In particular, Stolt-Nielsen requested that the arbitration panel supplement the already-existing confidentiality order governing the production of documents in the arbitration with additional restrictions designed to further protect various types of commercial information from dissemination to Stolt-Nielsen's customers and competitors. See In the Matter of the Arbitration Between Celanese Ltd. and Odfjell ASA, Transcript of December 21, 2004 Hearing ("Tr."), attached as Ex. 2 to Declaration of Jonathan E. Goldberg, December 31, 2004, at 20. Claimants, however, argued, inter alia, that the existing restrictions afforded adequate protection. Id. at 30-31. After attempts at compromise failed, the chairman of the panel, in a telephone conference on December 28, 2004, declined to modify the existing confidentiality order, finding in effect that it was sufficient to protect any legitimate concerns of Stolt-Nielsen. See Carney Decl. at ¶ 6; Declaration of Gary W. Dunn, January 4, 2004, ¶ 16.
The Court sees no reason to disturb the decision of the arbitration panel not to issue a protective order beyond the one already governing the arbitration. The panel's decision is entitled to considerable deference, given the panel's hands-on familiarity with the case and with the confidentiality issues here presented. But even considered de novo, Stolt-Nielsen's motion for additional confidentiality restrictions must be denied. Many of Stolt-Nielsen's proposed limitations would vitiate the purpose of the subpoenas by overly restricting who may see the documents at issue, while the other proposed limitations would strip the panel of its authority, increase the costs of the arbitration, undermine efficiency, and allow a non-party to engage in potentially endless delay. Accordingly, Stolt-Nielsen's proposed modifications are denied in all respects.
As for claimants' cross-motion to hold Stolt-Nielsen in contempt of court for allegedly not complying with the Court's Orders of December 7 and December 18, 2004, the motion is unpersuasive, since, as previously noted, Stolt-Nielsen appropriately reserved its concerns about confidentiality in its response to claimants' prior motion to compel compliance with the arbitration subpoenas and, pending resolution of those concerns, voluntarily agreed to turn over the documents to claimants' counsel subject to a lawyers-eyes-only agreement. Moreover, the date for turning over the documents to the panel itself was adjourned on consent, see Tr. 29, and has not yet passed.
Against the more general background of Stolt-Nielsen's delaying tactics, however, claimants' contempt motion was not frivolous, and therefore Stolt-Nielsen's request that the Court order claimants to pay Stolt-Nielsen's costs of opposing the motion is hereby denied.
Accordingly, for the foregoing reasons, the Court hereby re-confirms its earlier rulings denying Stolt-Nielsen's motion for a confidentiality order and claimants' motion for to hold Stolt-Nielsen in contempt.
SO ORDERED.