STIPULATED PROTECTIVE ORDER [Fed.R.Civ.Proc. § 26(c)]

JOHN E. McDERMOTT, Magistrate Judge.

This Court has substantial interest in protecting the legitimate privacy interests of the litigants and third parties while at the same time preserving the parties' rights to conduct full and complete discovery. In order to protect the confidentiality of confidential information obtained by the parties in connection with the above-captioned matter, plaintiff and counter-defendant 360NETWORKS (USA), INC. ("360networks") and defendant and counter-claimant, FREEDOM TELECOMMUNICATIONS, INC. ("Freedom") (the "Parties") hereby stipulate to, and respectfully request that the Court issue, the following Protective Order pursuant to Federal Rule of Civil Procedure 26(c).

RECITALS

WHEREAS, Rule 26(c) of the Federal Rules of Civil Procedure grants the Court broad discretion to issue protective orders limiting disclosure or discovery in order to avoid "annoyance, embarrassment, oppression, or undue burden or expense."

WHEREAS, Rule 502(d) of the Federal Rules of Evidence provides that the Court may order that privileges and protections are "not waived by disclosure connected with the litigation pending before the court—in which event the disclosure is also not a waiver in any other Federal or State proceeding."

WHEREAS, Rule 502(e) of the Federal Rules of Evidence provides that "[a]n agreement upon the effect of disclosure in a Federal proceeding is binding only on the parties to the agreement, unless it is incorporated into a court order."

WHEREAS, the Parties each possess documents and information that are potentially relevant to this dispute but protected from disclosure by privilege or other protections (including work-product) ("Privileged Information"), and they wish to avoid any waiver of privileges or other protections, except for intentional waivers made with the producing party's explicit knowledge and affirmative consent.

WHEREAS, the Parties each possess certain information, including, but not limited to, financial information, trade secrets, constitutionally protected private information, confidential research and development information and other types of confidential information, which is of value and not in the public domain, which could be subject to discovery or disclosure in this case, yet its unrestricted disclosure in the public domain would likely cause significant and irreparable harm to the Parties and their respective activities.

WHEREAS, the Parties expect to share documents and information obtained through discovery with their experts, consultants and others, including the Parties' employees, attorneys and advisers.

WHEREAS, it may not be practicable or financially feasible for the Parties to screen each and every page of potentially relevant material in this case to identify every instance of privilege or work-product protection or other protection from disclosure, and the Parties intend to employ computerized queries and other reasonable methods of categorization to make these designations.

WHEREAS, the Parties seek to reduce the costs and burdens of discovery in this case by ensuring that the legal privileges and protections that apply to privileged and protected information are not subject to any inadvertent, unintentional or unknowing waivers in this or any other jurisdiction, to the full extent permitted by law and regardless of whether the relevant efforts to avoid waiver, if any, are deemed reasonable or unreasonable by non-parties.

WHEREAS, the Parties also seek to preserve the full value and confidentiality of their confidential Information and any confidential information of others that they have a duty to protect.

NOW, THEREFORE, the Parties have agreed to preserve the confidentiality and privileged or protected status of discovered and discoverable documents and electronically stored information pursuant to this protective order ("Protective Order") according to the following terms and conditions:

DESIGNATION AND TREATMENT OF "CONFIDENTIAL" DOCUMENTS AND INFORMATION

1. Discovery Material. The following procedures shall be employed and the following terms, conditions, and restrictions shall govern with respect to all discovery materials and things produced and disclosed by the Parties and third parties in this proceeding, including all information contained in writings and documents, deposition testimony, deposition exhibits, interrogatory responses, and other written, recorded, or graphic matters (the "Discovery Material"). Any persons receiving confidential information, as defined herein, shall not reveal or discuss such information to or with any person who is not entitled to receive such information except as set forth herein.

2. Confidential Information. This Order shall govern all Discovery Material that a designating or producing party or non-party believes in good faith to be entitled to protection from disclosure under state or federal law as being confidential.

3. "Confidential" Designation. Discovery Material produced by any Party or non-party as part of discovery in this litigation may be designated by any party or producing non-party as "Confidential." The party which designates material as "Confidential" shall have a reasonable basis for believing, in good faith, that such designation is appropriate and consistent with the terms of this Order and applicable law, and that disclosure of the Discovery Material should be subject to protection under Federal Rule of Civil Procedure 26(c). This designation refers to material that constitutes or contains confidential business information or confidential personnel information about employees or third parties. This designation further refers to trade secrets or other confidential research, development, proprietary or commercial information, or other information that is not publicly known, whether embodied in physical objects, documents, or the factual knowledge of persons. Absent a specific order by the Court, once designated as "Confidential" such "Confidential" Discovery Material shall be used by the Parties solely in connection with this litigation and not for any other purposes, including but not limited to any other litigation, or any other business, competitive, governmental or regulatory purposes or functions.

4. Designation Procedure. The designation of Discovery Material as "Confidential" for purposes of this Protective Order shall be made in the following manner by the Party or non-party seeking protection:

5. Material Produced by a Non-Party. Any Party or non-party may designate as "Confidential" any Discovery Material produced by a non-party if the Party or non-party believes in good faith that such Discovery Material is entitled to protection from disclosure under the terms of this Order. Such designation shall be made by giving written notice of such intent and the relevant document numbers or other identification of the "Confidential" Discovery Material to all Parties, and the producing non-party, within thirty (30) days of the receipt of the Discovery Material, and shall thereafter be stamped or otherwise marked "Confidential."

6. Submissions to the Court. Unless otherwise ordered or directed by the Court, or agreed to by the Party or non-party designating the Discovery Material as "Confidential," a party submitting documents and things to the Court which disclose information designated as "Confidential" shall proceed in accordance with Local Rule 79-5.1, request that the documents be filed under seal, and inform the Court that the documents are subject to the Protective Order.

7. Disclosure of "Confidential" Information. All Discovery Material designated "Confidential" shall be used solely for the purpose of this proceeding and for no other proceedings or purpose. Discovery Material designated as "Confidential," or copies or extracts therefrom and compilations and summaries thereof, may be disclosed, summarized, described, characterized, or otherwise communicated or made available in whole or in part only to the following persons:

a. The law firms of record in the above-captioned litigation, their attorneys and staff, and in-house and/or general counsel and staff for any Party;

b. The named parties or officers or employees of any Party, to the extent deemed necessary by counsel for conducting the above-captioned litigation;

c. Experts and consultants for the purpose of assisting in the preparation of the case or for the purpose of testifying by deposition or at the trial of this matter, subject to and conditioned upon compliance with Paragraph 8 herein;

d. The Court, and the Court staff pursuant to Paragraph 6 herein;

e. Court reporters, notary publics, or stenographers at deposition, trial, or hearings, subject to the terms herein;

f. Copy services, database providers, or graphics or design providers retained by counsel for a Party as necessary for this action, including for purposes of preparing demonstrative or other exhibits for deposition, trial, or other court proceedings in this action, subject to and conditioned upon compliance with Paragraph 8 herein;

g. Any authors or recipients of the "Confidential" Discovery Material;

h. Testifying witnesses at deposition or at trial, subject to and conditioned upon compliance with Paragraph 8 herein. A witness shall sign the Acknowledgment as required under Paragraph 8 before being shown Discovery Material designated "Confidential." "Confidential" Discovery Material may be disclosed to a witness who will not sign the Acknowledgment as required under Paragraph 8 only in a deposition at which the Party or non-party who designated the "Confidential" Discovery Material is represented or has been given notice that "Confidential" Discovery Material produced by the Party or non-party may be used. At the request of any Party or non-party, the portion of the deposition transcript involving the "Confidential" Discovery Material shall be designated "Confidential" pursuant to paragraph 4 above. Witnesses shown "Confidential" Discovery Material shall not be allowed to retain copies. The Parties shall meet and confer regarding the use of "Confidential" Discovery Material at trial as set forth in Paragraph 17 below;

i. Jury or trial consultants retained by counsel for a Party, subject to and conditioned upon compliance with Paragraph 8 herein;

j. Any Private mediator(s) selected by the Parties to mediate this dispute; and

k. Any other person only upon order of the Court or upon prior written consent of the Party or non-party producing the "Confidential" Discovery Material. If either Party's counsel determines that the prosecution or defense of this action requires that "Confidential" documents, deposition testimony or information needs to be disclosed to persons other than those listed in Paragraph 7 above, counsel must provide all parties with written notice of intended disclosure not less than seven (7) days prior to disclosure. Any Party may provide a written objection to such notice prior to the intended disclosure. If such written objection is not made, the documents or information may be disclosed subject to this Stipulated Protective Order, including Paragraph 8. If a written response objecting to disclosure is made by a Party, the documents or information shall not be disclosed unless the Court so orders.

8. Access Subject To Agreement. Except as otherwise provided in Paragraph 7 above, all persons listed in Paragraphs c, h, i, and k above may be given access to information or material designated as "Confidential" only to the extent that they first confirm their understanding and agreement to abide by the terms of this Protective Order by completing and signing the Acknowledgment attached hereto as Exhibit A ("Acknowledgment"). The Acknowledgments shall be retained by counsel for the Party who obtains them, and nothing thereunder shall require the disclosure of reports and/or consultation that would not otherwise be required by law.

9. Use of "Confidential" Discovery Material at Deposition. If documents, deposition testimony or information designated by a Party as "Confidential" are to be used during a deposition in this action, only those persons authorized to review such documents pursuant to Paragraph 7 above may be present during the portion of the deposition during which such documents, deposition testimony, or information is discussed, unless the Parties agree otherwise.

10. Challenging a Designation. In the event that a receiving party disagrees in good faith with the designation by the designating/producing party of any information as "Confidential" and would like to use such "Confidential" information other than as permitted under this Order, the receiving party shall state its objections in writing. Within ten (10) days of the designating party's receipt of a written objection to a "Confidential" designation, the Parties shall, in good faith, meet and confer to attempt to resolve such dispute on an informal basis before presenting the dispute to the Court by motion or otherwise. In the event an informal resolution is not reached, the receiving party must, within ten (10) days of the date of the parties' conference, file a motion with the Court setting forth the basis for its challenge and seeking the Court's ruling as to whether the Discovery Material is properly designated as "Confidential." The designating party shall have the burden of persuasion that the designation should not be removed and is consistent with Federal and/or California law. Should such a motion be filed, the information shall be treated as "Confidential" subject to this Protective Order until the Court issues a ruling on the motion.

11. Jurisdiction. All persons who have access to information or material designated as "Confidential" under this Protective Order acknowledge they are bound by this Order and submit to the jurisdiction of this Court for purposes of enforcing this Order.

12. No Prejudice. Producing or receiving Discovery Material designated as "Confidential," entering into, agreeing to or otherwise complying with the terms of this Protective Order shall not:

a. Operate as an admission by any Party or non-party that any particular Discovery Material designated as "Confidential" contains or reflects trade secrets, proprietary or commercially sensitive information, or any other type of confidential information;

b. Operate as an admission by any Party or non-party that any particular Discovery Material designated as "Confidential" contains or reflects information that if disclosed would cause harm or be likely to cause harm to the producing party or non-party;

c. Operate as an admission by any Party or non-party that the restrictions and procedures set forth herein constitute or do not constitute adequate protection for any particular information deemed by any Party or non-party to be "Confidential;"

d. Prejudice in any way the rights of the Parties or non-parties to object to the production of documents they consider to be not subject to discovery;

e. Prejudice in any way the rights of any Party to object to the authenticity or admissibility into evidence of any document, testimony, or other evidence subject to this Protective Order;

f. Prejudice in any way the rights of a Party or non-party to seek a determination by the Court whether any information or material should be subject to the terms of this Protective Order;

g. Prejudice in any way the rights of a Party or non-party to petition the Court for a further protective order relating to any purportedly confidential information;

h. Prevent the Parties to this Protective Order from agreeing in writing or on the record during a deposition or hearing in this action to alter or waive the provisions or protections provided for herein with respect to any particular information or material;

i. Limit a Party's or non-party's ability to grant other parties or non-parties access to its own documents and/or information;

j. Limit any Party in the introduction of "Confidential" Discovery Material into evidence at trial, subject to Paragraph 17 below and the designating party's or designating non-party's right to seek further protection from the Court;

k. Be deemed to waive any applicable privilege or work product protection, or to affect the ability of a Party or non-party to seek relief for an inadvertent disclosure of material protected by privilege or work product protection; and/or

l. Prevent a Party or non-party from objecting to discovery which it believes to be improper, including objections based upon the privileged, confidential, or highly confidential nature of the Discovery Material requested.

13. Use of Party's Own Designated Information. This Protective Order has no effect upon, and shall not apply to, a Party's or non-party's use or disclosure of its own "Confidential" Discovery Material for any purpose. Nothing contained herein shall impose any restrictions on the use or disclosure by a Party or non-party of documents, information, or Discovery Material designated as "Confidential" obtained lawfully by such Party or non-party independently of any proceedings in this action, or which:

a. Was already known to such Party or non-party by lawful means prior to acquisition from, or disclosure by, another Party or non-party in this action; provided, however, that any such person who provides such information is not subject to a confidentiality agreement or other restriction barring the provision of such information; or

b. Is or becomes publicly known through no fault or act of such Party or non-party.

14. Inadvertent Disclosure Of Confidential Information. Any "Confidential" Discovery Material that is inadvertently produced without written notice or identification as provided in Paragraph 3 through Paragraph 5 of its confidential nature may be so designated in writing by the producing party or non-party after the realization that the "Confidential" Discovery Material has been produced without such designation. However, until the Discovery Material is designated as "Confidential" as set forth in Paragraph 3 through Paragraph 5, the Parties shall be entitled to treat the material as non-confidential. As soon as the receiving party becomes aware of the inadvertent production, the information must be treated as if it had been timely designated under this Protective Order, and the receiving party must endeavor in good faith to obtain all copies of the document that it distributed or disclosed to persons not authorized to access such information by Paragraph 7 above, as well as any copies made by such persons.

15. Modification of Protective Order. It is the present intention of the Parties that the provisions of this Protective Order shall govern discovery and other pretrial proceedings in this action. Nonetheless, each of the Parties or any other proper party hereto shall be entitled to seek modification of this Protective Order for good cause by first meeting and conferring, in good faith, on the proposed modification. To the extent the Parties agree on the proposed modification, the Parties shall stipulate to the proposed modification and submit such stipulation for approval by the Court. If the Parties are unable to agree on the proposed modification, the party seeking the modification may apply to the Court on notice to the other Parties hereto and, in doing so, must attest to the Court that it met and conferred in good faith with the other Parties but could not come to an agreement on the proposed modification.

16. Survival. Final termination of this proceeding, including exhaustion of appellate remedies, shall not terminate the limitations on use and disclosure imposed by this Protective Order. Upon final termination of this proceeding, all reasonably accessible versions of "Confidential" Discovery Material and copies thereof, including but not limited to such Discovery Material in the hands of outside experts or consultants, shall be delivered to counsel of record for the producing party or non-party of such "Confidential" Discovery Material, upon request, within sixty (60) days of such request, or else shall be destroyed upon request and the producing party shall be advised in writing within sixty (60) days of the request that such Discovery Material has been destroyed, except for "Confidential" Discovery Material filed with the Court, whether or not filed under seal; provided, however, that counsel of record may retain copies of briefs and other papers filed with the Court and attorney work product which contains or constitutes "Confidential" Discovery Material so long as such briefs and other papers are maintained in accordance with the provisions of this Protective Order. Counsel need not certify the destruction of "Confidential" Discovery Material contained in inaccessible repositories, including, without limitation, system-backup media, compressed archival formats, unused legacy systems, unsearchable file fragments, deleted files or slack space, backup tapes or computer caches, so long as the "Confidential" Discovery Material is not readily accessible to users and will continue to be treated as confidential.

17. Use of Designated Discovery Material in Court Proceedings. In the event that any Discovery Material designated as "Confidential" hereunder is used in any court proceeding in this action or any appeal therefrom, such Discovery Material shall not lose its status as "Confidential" through such use. Counsel for the Parties shall confer on such procedures as are necessary to protect the confidentiality of any documents, information, and transcripts used in the course of any court proceedings, and shall incorporate such procedures, as appropriate, in the pre-trial order.

18. Other Actions. If any party (a) is subpoenaed in another action, (b) is served with a demand in another action to which it is a party, or (c) is served with any other legal process by one not a party to this action seeking information or material which was produced or designated as "Confidential" by someone other than that party, the party shall give prompt actual written notice, by hand or facsimile transmission, within ten (10) days of receipt of such subpoena, demand, or legal process, to those who produced and/or designated the Discovery Material, prior to compliance with the subpoena so as to allow the producing and/or designating parties or non-parties to seek protection from the Court or courts. Nothing herein shall be construed as requiring the party or anyone else covered by this Protective Order to challenge or appeal any order requiring production of information or material covered by Protective Order, or to subject itself to any penalties for noncompliance with any legal process or order, or to seek any relief from this Court.

19. The Parties agree that certain documents or electronically stored information could be so sensitive that they reasonably should not be disclosed beyond the other Parties' outside- or in-house-counsel. With respect to such "Attorney's Eyes Only" materials, the Parties shall, as soon as practicable, bring the sensitive nature of the items to the attention of the other Parties' outside counsel, and the Parties shall meet and confer in an attempt to agree upon proper treatment of the materials.

DESIGNATION AND TREATMENT OF PRIVILEGED AND PROTECTED DOCUMENTS AND INFORMATION

20. The Parties shall take steps that are, in the exclusive judgment of each of them, reasonable to identify information that is protected from disclosure due to the attorney-client privilege, attorney work-product doctrine or other legal protection ("Privileged Information,"), and to prevent its disclosure. This can include but is not limited to attorney screening, keyword search screening, metadata filtering, the application of advanced analytical tools, designation by subject matter, location or custodian where appropriate, any combination of these, or other methods not listed. The Parties shall not indiscriminately designate documents or information as Privileged Information.

21. No inadvertent disclosure of Privileged Information not identified through the methods a party employs shall constitute a waiver of any privilege or other protections (including work product) in this or any other proceeding if the producing party took reasonable steps, as defined herein, to prevent its disclosure and to rectify the error in the event of an inadvertent, unintentional or unknowing disclosure.

22. The producing party will be deemed to have taken reasonable steps to rectify an erroneous disclosure if, within thirty (30) days of discovering the error, but no later than ten (10) days following knowledge of an opposing party's use of such Privileged Information, the producing party notifies the receiving party of the claim of privilege and the basis for it and directs the receiving party to sequester, return, delete, or destroy all copies of the inadvertently produced Privileged Information.

23. Upon receiving such a request and notification of an inadvertent disclosure, or if a receiving party or its counsel self-identifies Privileged Information in a production, the receiving party shall promptly sequester, return, delete or destroy all copies of such inadvertently produced Privileged Information, including any and all work-product containing or derived from Privileged Information, and shall make no further use or disclosure of the Privileged Information whatsoever. The receiving party must notify the producing party if Privileged Information was disclosed before the receiving party received notification of its privileged status, and the receiving party must take all reasonable steps to secure the return of any Privileged Information of a producing party that the receiving party has disclosed.

24. Parties shall act in good faith to timely produce privilege logs. A party's failure to timely produce a privilege log shall not constitute a de facto breach of this Order or waiver of any privileges or protections.

25. Nothing in this Protective Order shall prevent a receiving party from challenging the assertion of privilege or other protection with respect to any documents or electronically stored information subject to discovery in this case; provided, however, that any challenge to Privileged Information that has been inadvertently produced must be made within ten (10) court days after the producing party gives notice of the privilege or protection, by presenting the disputed information under seal with the Court for determination pursuant to Federal Code of Civil Procedure 26(b)(5)(B).

26. Notwithstanding anything to the contrary herein: (a) Privileged Information that has been prepared by or at the direction of the Parties' outside lawyers during the pendency of this action is not subject to discovery in this litigation; and (b) the Parties shall not be required to reflect in any privilege log the communications of or with their outside counsel or their outside counsel's work-product prepared in anticipation of this litigation or during its pendency, provided that such communications and protected materials relate to the representation of the party in this case.

ADDITIONAL PROVISIONS

27. Before the expiration of a deadline under the Protective Order, the Parties may request reasonable extensions under the circumstances existing at the time, and such requests shall not be unreasonably denied.

28. The provisions of this Protective Order may be modified at any time by stipulation of the Parties approved by order of the Court. In addition, a Party may at any time apply to the Court for modification of this Protective Order, provided that the Party seeking modification of this Protective Order has first met and conferred in good faith with the other parties hereto, and provided further that the Party seeking modification attests to the Court that it met and conferred in good faith prior to seeking the Court's intervention

29. Nothing in this Stipulated Protective Order shall constitute: (a) an agreement by any party to produce any documents or other materials in discovery not otherwise agreed upon or required by court order or the Federal Rules of Civil Procedure; (b) a waiver by any person or party of any right to object to or seek a further protective order with respect to any discovery in this or any other action; or (c) a waiver of any claim of immunity or privilege with respect to any testimony, document or information.

30. The Parties expressly acknowledge that, by entering into this Stipulation, they do not waive any claims or defenses.

SO STIPULATED as of the date of execution.

SO ORDERED as of the date of execution.

APPENDIX A

ACKNOWLEDGEMENT AND AGREEMENT TO BE BOUND BY PROTECTIVE ORDER

I, ___________________ [print or type full name], declare under penalty of perjury of the laws of the State of California that:

1. My address is: _________________________________________.

2. My employer is: ________________________________________.

3. My occupation is: _______________________________________.

4. I have read in its entirety and understand the Stipulation and Protective Order in the case styled 360networks (USA), Inc. v. Freedom Telecommunications, Inc., Case No. CV-12-1831 (C.D. Cal.) (the "Order").

5. I agree to comply with and to be bound by all the terms of the Order, and I understand and acknowledge that failure to so comply could expose me to sanctions and punishment, including being held in contempt of court. I will hold in confidence, will not disclose to anyone not qualified under the Order, and will use only for purposes of this case all "Confidential" Discovery Material, including any notes about or summaries of such information.

6. I hereby submit to the jurisdiction of this Court for purposes of enforcement of the Order, even if such enforcement proceedings occur after termination of this case and even if the Court would not otherwise have personal jurisdiction over me.