ARIZONA STATE SENATE
Phoenix, Arizona
REVISED
confidentiality agreements;
restrictions
Purpose
Limits confidentiality in
settlements in civil cases when the action was for injury, wrongful death or
financial loss caused by a defective product, environmental hazard or financial
fraud and requires specified types of documents to be made public unless
certain exceptions apply.
Background
The Arizona Rules of the
Supreme Court include a rule relating to public access to the records of all
courts and administrative offices of the judicial department. Rule 123 states that records in all courts
are presumed to be open to any member of the public, but that due to the
countervailing interests of confidentiality, privacy or the best interests of
the state, public access to some court records may be restricted. S.B. 1530 requires confidentiality and
settlement agreements not filed with the court and information acquired through
discovery to be made public unless certain exceptions apply.
According to the Arizona
Trial Lawyers Association, 16 states have statutes with anti-secrecy provisions
that either specify hazardous substance claims and personal injury and wrongful
death claims or that apply generally to court records. A bill similar to S.B. 1530 has also been
introduced in the California legislature during its current session.
Any potential impact upon
the state general fund is unknown at this time.
Provisions
1. Requires confidentiality and settlement agreements not filed with the court and information acquired through discovery to become public information in most instances if the information relates to an injury caused by a defective product, financial fraud, or environmental hazard.
2. Permits a court to keep information confidential for a period of time the court deems appropriate if the information is a trade secret or privileged.
3. Requires an overriding interest to exist in order to keep information confidential that is otherwise public. Requires all three of the following to apply in order to meet the overriding interest test.
§
a
substantial probability exists that the overriding interest will be prejudiced
if the information is not kept confidential;
§
the
proposed confidentiality is narrowly tailored; and
§
there
is not a less restrictive means to achieve the overriding interest.
4. Makes void and unenforceable any portion of an agreement or contract that restricts a party from disclosing information relating to a defective product, financial fraud or environmental hazard to a governmental agency with enforcement authority.
5. Clarifies that the bill is not intended to prevent or limit a governmental agency from obtaining any information to which the agency is otherwise statutorily entitled.
6. Defines “defective product,” “environmental hazard” and “financial fraud.”
7. Provides for a general effective date.
Amendments Adopted by Committee
1. Clarifies that the bill is not intended to prevent or limit a governmental agency from obtaining any information to which the agency is otherwise statutorily entitled.
2. Changes the definition of environmental hazard to include present danger of death, bodily injury or harm to a person’s health.
Senate Action
JUD 3/6/01 DPA 8-0-0-0
Prepared by Senate Staff
March 8, 2001