The Texas Business Court recently issued an opinion clarifying the scope of who is considered an attorney when dealing with "confidential" and "attorney's eyes only" designations in discovery. In Unimacts Global, LLC, et al v. Ayr Energy, Inc., No. 25-BC11A-0083 (Tex. Bus. Ct. 8/17/2026), the court ruled that attorneys from India who represent plaintiff Zetwerk Manufacturing in various matters, but who were not counsel of record in the Texas state court case, were not privy to such protected and designated confidential materials.

In this case involving alleged misappropriation of trade secrets between rival transformer manufacturers, the Texas Business Court issued a protective order establishing two levels of protected designations: "Confidential Information" and “Attorney's Eyes Only.” The Protective Order allowed for "outside counsel working on this lawsuit" to have access to protected documents so designated. Plaintiffs sought to share designated protected documents with their counsel in India, leading to the discovery dispute at the center of this opinion. 

The court stressed that protecting trade secrets is a high priority of the courts and that Texas law creates a strong presumption in favor of protecting trade secrets. When deciding who may access confidential information, the courts must balance the risk of inadvertent disclosure or misuse against the potential that barring access will impair a party's ability to prosecute or defend its claims. In so weighing, the courts consider the factual circumstances surrounding each individual attorney's activities and relationship with a party, including (1) whether the attorney receiving confidential information is involved in the company's competitive decision making, (2) the risk of inadvertent disclosure, and (3) the hardship caused by denying access. The courts also consider (4) the requesting party's need for the information. 

This is where the court's distinction between "in-house counsel" and "outside counsel" becomes critical. If in-house counsel's knowledge of confidential information could put them in the untenable position of choosing between providing legal advice to their client and abiding by the court's protective order, they should not have access to such information. It is the actual relationship with and advising of Zetwerk as opposed to any title given these attorneys that drove the court's decision.

Because the language of the Protective Order was deemed ambiguous, the court deployed this balancing test to assess whether attorneys who had assisted with the case without making an appearance or otherwise formally enrolling in the case as counsel of record should be able to access such information. 

Applying the factors, the court determined that (1) the attorneys in question were involved in competitive decision making as they represented Zetwerk in other litigation matters, including against one of defendant Ayr Energy's principals. It was very reasonable given the connections that protected information could influence the attorneys in other matters. (2) The risk of inadvertent disclosure was very high. In fact, it had already happened in the case wherein one of the lawyers discussed designated materials with Zetwerk executives and decision makers. (3) Additionally, because the attorneys in question were outside of the court's jurisdiction, curbing the impact from misuse of the protected information would be near impossible. Finally, (4) Zetwerk failed to show any real need for the information. Citing only generalities, there was no specific evidence of prejudice if the court restricted access to the information.

Ultimately, the court prohibited Zetwerk's attorneys from India from accessing protected documents in the case pending before the Texas Business Court. 

This case highlights that prior inadvertent disclosures can be dispositive when negotiating disputes over protective orders, further stressing the need to prevent such whoopsies. It also shows that the Texas Business Court will dig into the actual relationships between attorneys and their clients with respect to the individual case pending — lip service that attorneys are “counsel” is not good enough. Companies should be aware that foreign counsel will face added scrutiny, highlighting the importance of engaging Texas counsel. Finally, when challenging the bounds of a protective order, generalizations won't cut it — actual evidence of specific prejudice is needed. "Vague, conclusory allegations are insufficient."