Steven Loble

Confidentiality of Sources – an exercise in judicial judgment

The recent case of Rio Tinto plc v Vale SA and others [2015] EWHC 1865 (QB) dealt with the right of confidentiality of sources who had provided information to a business intelligence company.

The judge outlined the powers of the English Court as follows,

“The powers of the English court to make orders to enable evidence to be taken for foreign proceedings are limited by the terms of the Evidence (Proceedings in Other Jurisdictions) Act 1975 ("The Act"). The principle of comity ensures that the court starts from the basis that it is obliged to give effect to the request unless there is a good reason not to. It will generally rely on the judgment of the foreign court as to what evidence is relevant: see Rio Tinto Zinc v Westinghouse Electric [1978] AC 547 at 654. As a general principle the English court will give effect to a request from a foreign court for assistance in obtaining evidence for the purpose of proceedings in that court so far as is proper and practicable and to the extent that is permissible under English law.”

In this case, Vale had managed to obtain copies of business intelligence reports from Rio Tinto pursuant to an order of the New York Court, subject to a protective order, which permitted only the parties attorneys to see them.  The issue before the English Court was whether the proposed witnesses should be required to identify the individuals from whom they obtained the information used to compile the reports.

The Judge summarised the position in relation to obtaining evidence in England for use in foreign proceedings,

“As a matter of English public policy, applications under the Act may not be used for the purpose of obtaining pre-trial discovery in accordance with US civil procedure: Section 2(3) of the Act, and see Westinghouse Electric (above) per Lord Diplock at 634G-H. Evidence may be taken only for the purpose of proving (or disproving) a case at trial. Moreover the documents must be "particular documents specified in the order"; the documents can be compendiously described, but only so long as the description clearly identifies the exact documents to be produced. If it is too widely couched, the English court will try to give effect to the Letter of Request to the extent that it can. It is entitled to apply the metaphorical "blue pencil" to edit a Letter of Request by deleting aspects of it that are objectionable, but it cannot substitute a different request: Refco Capital Markets v Credit Suisse (First Boston) Ltd [2001] EWCA Civ 1733 at [30]-[32].

A relevant consideration for the court is whether a respondent to the request will be required to breach a confidence in giving evidence or providing documents. However, confidentiality in and of itself is unlikely to be a sufficient reason for refusing to accede to a request. The court must undertake a balancing exercise, weighing on the one hand the public interest in preserving the confidentiality, and on the other hand the public interest in the English court assisting the foreign court in obtaining evidence in this jurisdiction and enabling the fair resolution of court proceedings: see e.g. In re Norway's Application (Nos 1 & 2) [1990] AC 723 per Lord Goff at 810G.”

By way of background the Judge referred to a case in a domestic context, Science Research Council v Nasse [1980] AC 1028 in which Lord Wilberforce described how the court should set about the balancing exercise:

  ", the process is to consider fairly the strength and value of the interest in preserving confidentiality and the damage which may be caused by breaking it; then to consider whether the objective - to dispose fairly of the case - can be achieved without doing so, and only in a last resort to order discovery, subject if need be to protective measures. This is a more complex process than merely using the scales; it is an exercise in judicial judgment." (my emphasis)

In conducting the balancing exercise the judge stated,

“Whatever may be the contractual position as between Rio Tinto and the individual Respondents, I am satisfied on the evidence before me that the sources in question have all been given assurances or undertakings that their identities will be kept confidential and that their co-operation with the Respondents and their representatives and imparting of the information was premised upon that understanding. Their identities are subject to a duty of confidentiality, and would continue to be subject to such a duty if they had been imparted to Rio Tinto whether voluntarily or compulsorily. That duty is an important and serious one; those individuals are entitled to assume that their identities are not going to be made known to anyone without their permission. The public policy in maintaining confidentiality in those circumstances is strong.”

The Judge recounted that a witness, Ms O’Connor, from one of the business intelligence providers explained,

“how her firm operates in several countries or regions where its work threatens established corrupt networks in politics and business. Some of those are geographical areas with a high risk of political volatility, regime change and state-sponsored violence. She gives a graphic description of what has happened in the past to her colleagues when ARC's involvement in anti-corruption projects and investigations has become known, and she describes the specific risks for journalistic and business intelligence sources - as well as journalists themselves - in Guinea.

Ms O'Connor confirms that each source that ARC used for the business intelligence reports received an assurance that their identity would not be disclosed in any circumstances when they began working for ARC and that if they were to be identified, they were highly likely to be put in a position whereby they would fear for their safety or wellbeing, or at the least adversely affected in their employment or career. She states that it is realistic to believe that disclosure could have potentially threatening repercussions, including deadly repercussions, not only for them but for their families. She says in respect of two sources in particular, sources B and J, disclosure is likely to place their immediate families at risk.”

The Judge was also clearly influenced by the risks to the sources.  As she summarised,

“Finally, all three Respondents contend that their reputations and businesses could be damaged if it came out that they had been forced by the court to disgorge the identities of their sources of information, even into a confidentiality ring. They say that there is a real risk that they would no longer be able to recruit or engage individuals to give them the information upon which they depend. Whilst I do not regard that risk as fanciful, I would not be minded to refuse disclosure if that were the sole ground of objection. The risks that the breaches of confidence pose to the individuals concerned are of far more importance and carry far more weight with the court in this context.”

The Judge stated,

“The identity of the sources is, at best, of marginal relevance. In my judgment the fair and just resolution of the underlying litigation in New York can be achieved without requiring the very serious breaches of undertakings of confidentiality that revealing those identities would entail…

For those reasons, the balancing exercise clearly comes down in favour of acceding to the Respondents' applications. The Orders are to be varied so as to make it clear that the Respondents are under no obligation to reveal any information that would identify the individual sources….

Given that the task of this Court is to give effect to the Letter of Request to the extent that it is possible to do so, bearing in mind the competing public policy considerations, I consider that it would be appropriate for me to direct that Livingstone and ARC shall carry out an exercise of the nature I have described above. Although Vale's lawyers will not know the identities of the individual sources, they will have descriptions of them and they will know which aspects of the information in the business intelligence reports were provided by which source. That is enough to create a fair balance between the competing public interests in this case and possibly gives Vale more than what they would be strictly entitled to. I do not consider that this would go beyond what is legitimate use of the blue pencil because it is directing where the boundaries of the directed disclosure lie. Mr George did not argue against my taking that course. Subject to that condition, the application for a variation of the Orders is allowed.”

In summary, the Judge acceded to the argument that sources of information or their families could be put at risk by identifying them, but provided that the position of each of the sources be revealed and which information was provided by each of the sources.

It is clear that this was more than simply an exercise balancing competing interests.  This was a more complex process than merely using the scales; it was an exercise in judicial judgment, weighing on the one hand the public interest in preserving confidentiality, and on the other hand the public interest in the English court assisting the foreign court in obtaining evidence in this jurisdiction and enabling the fair resolution of court proceedings.  As the Judge stated, this possibly gave the Applicant more than it would be strictly entitled to, but preserved the identity of the individual sources and accomplished the aim of the exercise, namely to give effect to the request from the US court.

For information on obtaining evidence in England for foreign proceedings see Obtaining Evidence in England.