To prevent another party to a lawsuit, possibly a business competitor, from seeing sensitive documents, courts in certain jurisdictions form confidentiality clubs to keep certain information private. Espie Angelica A. de Leon explains.

In patent litigation, highly sensitive confidential information including technical data needs to be disclosed during evidence exchange, cross examination, court-appointed appraisal or trial hearings. In pharmaceutical and biotech patent suits, confidential documents may include regulatory dossiers, manufacturing process details, formulation data and bioequivalence studies. In technology and software disputes, these could be source codes, algorithms or architectural design documents.

To prevent the other party, possibly a business competitor, from seeing these documents, courts in certain jurisdictions form confidentiality clubs, also called confidentiality rings, composed of a select group of individuals.

“A confidentiality club or confidentiality ring is a protective mechanism used in legal proceedings to enable the disclosure and review of highly confidential or commercially sensitive information while strictly controlling who may access such information, preventing the receiving party, especially a competitor, from gaining an unfair commercial advantage through access to such information,” said Zunxia Li, partner at IP March in Beijing.

Confidentiality clubs are used primarily in patent litigation, often in cases involving Standard Essential Patent (SEP) licensing, FRAND disputes and patent infringement. They are also used in trade secret misappropriation and confidential information actions where the misappropriated subject matter itself cannot be pleaded or proved without disclosure to the opposing side, as well as other technology-related or commercial IP disputes.

Other examples of sensitive documents that have to be disclosed in such disputes are:

1. SEP and licensing disputes: Comparable license agreements, royalty rates, negotiation records, sales data, pricing information, technical documents and business strategies
2. Patent infringement, trade secret cases and other technology-heavy commercial disputes: Confidential R&D materials, product designs, manufacturing processes, source code, sales figures, margins, customer lists, distribution agreements, other core trade secrets

“For instance, if a patent covers a specific chemical synthesis sequence, the plaintiff may need to inspect the defendant’s internal batch manufacturing logs to establish identity or variations. A confidentiality club allows this exchange without exposing trade secrets to the market,” said Chinthan Japhet, a partner at Krishnamurthy & Co. in Bengaluru.

His second example refers to electronics and software patents. “For example, mapping patent claim elements might require looking at proprietary software source code, semiconductor chip layouts or internal product schematics that are not publicly accessible,” he said.

“The underlying preference for constituting confidentiality clubs is due to the tension between the competing demands of adversarial litigation, i.e., the right of a party to see and test the evidence relied on against it, and the right of the disclosing party or a third party whose information has been drawn into the proceedings, to prevent commercially sensitive material from leaking into the hands of competitors,” said Pankaj Soni, a partner at Remfry & Sagar in Gurugram.

Li added that the scope of confidentiality clubs may vary, depending on the nature of the case and the degree of sensitivity of the documents. Only a small and clearly defined group of individuals are typically allowed access to said documents. These may include external counsel or outside lawyers, independent expert witnesses or technical consultants. If necessary, access may also be granted to an internal counsel or key internal representatives, subject to more stringent conditions. Litigation support staff, translator and e-discovery vendors may also be part of this select group if expressly permitted. “These members are normally required to sign a legally binding confidentiality undertaking, confidentiality declaration, or affidavit before accessing the confidential information, confirming that they will use the confidential materials solely for the purposes of the proceedings and will not disclose them to any unauthorized person,” said Li.

For Sanil Khatri, local principal at Baker McKenzie Wong & Leow in Singapore, one of the most important elements would be that these confidentiality mechanisms stop the original lawsuit itself becoming a fresh data breach/attack. He cited the U.S. case of In re Ring LLC Privacy Litigation, a consumer privacy case brought against Amazon’s home security subsidiary, Ring. Khatri revealed that the discovery protective order stated that the information involved “unique risks related to privacy, data security” and the like.

“This highlights how confidentiality mechanisms come into play, because unrestricted disclosure in many privacy cases could essentially operate like a map for cyber attackers, illustrating a system’s weak points and making it much easier for these malicious individuals to launch an attack on the system. Take a look at the reported incident in 2025, where hackers breached the U.S. federal judiciary’s electronic case filing system, CM/ECF, and was even described as ‘like taking candy from a baby,’” Khatri pointed out.

Confidentiality clubs in India

Confidentiality clubs or confidentiality rings are common, even routine, in India. They are an expressly recognized feature of patent litigation before the Delhi High Court and, increasingly, before the Bombay, Calcutta and Madras High Courts.

In fact, confidentiality clubs are now formally recognized and institutionalized under Rule 19 of the Delhi High Court Intellectual Property Rights Division Rules, 2022. The rule provides a clear and predictable framework for sharing confidential data during litigation.

Aside from pharmaceutical patent cases, confidentiality clubs have also become standard in FRAND disputes in the telecommunications industry in India where courts examine global patent licensing agreements containing highly sensitive commercial terms.

According to Japhet, managing confidentiality clubs, from a practical standpoint, is a structured and precedent-driven process in India. Counsel must draft and negotiate specific terms of reference based on established judicial guidelines.

He mentioned Telefonaktiebolaget LM Ericsson v. Xiaomi, 2016. “The Delhi High Court allowed an ‘external eyes only’ tier so that the patent owner could introduce confidential global patent licensing agreements without leaking sensitive pricing and terms to competitors. This serves as the baseline for protecting commercial records,” Japhet told Asia IP.

He also cited Nokia v. Asustek, 2025. Select in-house representatives were allowed to be part of the club. However, they were required to disclose in future commercial negotiations that they were able to view their competitor’s proprietary data, thus managing in-house access.

Meanwhile, InterDigital Technology Corp. v. Xiaomi, 2020, showed that the court ensured the presence of client input in litigation. “The court rejected a strict ‘legal eyes only’ tier that would have kept the defendant’s officers completely in the dark. The ruling confirmed that an attorney cannot argue complex technical issues without direct input from the client’s team,” Japhet explained.

Are confidentiality rings serving their purpose?

“On balance, yes,” says Soni. “Given how regularly parties now seek confidentiality clubs in IP litigation, the practical assessment is that confidentiality clubs in India are working well enough to remain the default mechanism in SEP and other patent cases involving sensitive licensing information.”

Japhet agreed. He says that confidentiality clubs succeed in balancing protection and disclosure, effectively resolving a major conflict in patent litigation; that is, how a party can prove its case using confidential data without destroying the data’s commercial value despite public disclosure. “For example, under Section 104A of the Indian Patents Act, when a patent covers a process for obtaining a product, the court can shift the burden of proof to the defendant to show their process is different. A confidentiality club provides a secure way for the defendant to submit proprietary factory records to independent experts without revealing formulas to a direct competitor. Similarly, in telecom licensing disputes, these clubs allow judges to review actual, unredacted global licensing agreements to calculate FRAND royalty rates based on real market data,” he said.

However, Japhet emphasized that confidentiality clubs require careful judicial management so as not to cause procedural delays.

Additionally, Soni noted that confidentiality rings are not a complete substitute for the kind of attorney-eyes-only and outside-counsel-only regimes common in the United States and United Kingdom. “The jurisprudence on access by in-house personnel is still maturing. In many ways, the confidentiality club serves as a more workable alternative to in camera proceedings or wholesale sealing of the record, both of which tend to be cumbersome and to limit the parties’ ability to engage with the evidence,” he noted.

Soni pointed out, however, that some cases in India have exposed some challenges, which he termed genuine tensions. “A point to pause and consider here is that confidentiality clubs are supposed to manage access to the minimum necessary information for a fair adjudication of the issues actually in dispute, while protecting genuinely sensitive material from broader exposure,” he said.

Recent cases include Koninklijke Philips N.V. v. Vivo Mobile Communication Co. Ltd. “The court accepted that the existence of a confidentiality ring does not automatically entitle the receiving party to unrestricted access to all information in the disclosing party's possession and permitted redaction of irrelevant material,” Soni said.

Another is InterDigital Technology Corporation v. Guangdong Oppo Mobile Telecommunications Corp. Ltd. “The court directed that complete third-party license agreements be disclosed to all members of the confidentiality club, including in-house representatives, holding that such agreements were important for evaluating the plaintiffs’ FRAND position and the defendants’ alleged status as unwilling licensees. The court also relied on confidentiality safeguards, including restrictions on future negotiations by in-house representatives,” he said.

“Read together, the two decisions show the IPD’s case-specific approach to calibrating access to balance confidentiality concerns against the extent of disclosure considered necessary for adjudication,” said Soni.

Japhet added that an overly restrictive EEO tier presents a challenge. Under this tier, the opposing party’s internal technical team and directors are completely excluded. This opens up a problem: How can the patent attorney effectively cross examine a technical expert or interpret complex chemical formulas without guidance from his own client who will provide the technical context? “Restricting access too tightly can undermine a party’s right to a fair defense,” Japhet emphasized.

However, India’s courts have multi-tiered mechanisms in place to manage these restrictions. These mechanisms allow a limited number of non-commercial technical advisors from the client's organization to see the confidential records, thus enabling attorneys to receive guidance and adequate instructions.

China: The need for mature confidentiality protection measures

In China, civil proceedings adopt a system of evidence exchange, hence confidentiality clubs or confidentiality rings are not common.

What courts have are similar confidentiality protection measures in cases involving trade secrets or highly confidential commercial information. “Upon a party’s application or ex officio, the court may restrict the scope of persons permitted to access documents containing confidential information, either by way of a court ruling or through execution of a confidentiality agreement, confidentiality undertaking or confidentiality commitment,” Li said.

These persons to whom access may be granted usually include external counsel, experts or other third parties, all approved by the court. The parties to the case may be barred from access to the documents as well as inspecting, excerpting, copying, photographing or otherwise obtaining such sensitive information.

“Any breach of such confidentiality obligations may lead to civil sanctions, such as fines or detention, and in serious cases, may also give rise to criminal liability,” Li stated.

Does she believe China’s judicial system ought to adopt the confidentiality club mechanism as utilized in other jurisdictions including India?

Li said it wouldn’t be fully compatible with the Chinese judicial system. Civil proceedings in China adopt a system of evidence exchange, rather than a U.S.-style discovery system. What Chinese courts can do, she pointed out, is to draw from the experience of foreign confidentiality club arrangements “to establish a more mature confidentiality protection mechanism suited to China’s litigation system, with clearer formal requirements, more standardized procedures and more complete remedies. This would make confidentiality protection in Chinese litigation more predictable, consistent and effective,” she opined.

According to Li, China’s legal rules for confidentiality protection mechanisms in litigation are fragmented. A certain degree of inconsistency in judicial practice is another flaw.

Singapore: Same concept, different names

In Singapore, the concept of a confidentiality club does exist, but under different names.

In Genk Capital Pte Ltd v. Zhang Changjie in 2020, the mechanism was called a “confidentiality undertaking.” The court considered restrictions on the inspection of confidential documents and required the defendant to view the allegedly confidential materials only in the presence of solicitors and not to keep copies.

I-Admin (Singapore) Pte Ltd v. Hong Ying Ting termed it as a “non-disclosure undertaking executed under a confidentiality club.” The case, which involved confidential client data in relation to payroll and human resources software systems, actually referred to a confidentiality club. “The judgment records that NDAs were executed under a confidentiality club to restrict disclosure of information obtained during discovery. This shows how confidentiality mechanisms are utilized by the court to ensure confidential information does not face the possibility of being exploited,” Khatri told Asia IP.

Even less common in Singapore is the term “confidentiality ring,” which is used more in the U.K. and European Union.

“A more appropriate term would be to name them confidentiality mechanisms from a Singapore-jurisdictional standpoint. Regardless, their purpose is to allow legal proceedings to continue without unnecessarily exposing sensitive information,” said Khatri.

Asked if he believes such mechanism is serving its purpose, Khatri said yes, as long as they are used proportionally, meaning the confidentiality mechanism is transparent when in operation and subject to judicial supervision.

He explained: “Naturally, a confidentiality mechanism should not be used to disadvantage the other party in proceedings. This is the court’s balancing exercise, and in practice this means asking what information is genuinely confidential, who really needs access, whether access can be tiered, whether the proposed restrictions would prevent a party from properly testing the case and so on.”

Khatri added that confidentiality mechanisms should continue to be available and used with proportionality in Singapore cases, “especially when dealing in matters of IP and technology where there is significant sensitive and proprietary information.”

Singapore has a strong policy interest in supporting innovation in technology, he noted, and the Supreme Court of Singapore provides an IP Court Guide with information on the specialist management of IP cases and those where highly sensitive data may be disclosed. “This environment highlights the importance of having tools in place that will both give comfort to rights holders and preserve fairness by ensuring the receiving party has access to the information needed to test their case,” Khatri said.