Among other things, the WBTS would like to hide between the confidentiality that is recognized between clergy and penitents.
The rationale behind this confidentiality is so as not to discourage an individual from being able to "come clean to God" about sin.
However, California Evidence Code (which governs what may be introduced to the jury at trial) says that in this situation (when an individual has confessed to a priest), in order for the priest to claim the privilege of confidentiality, certain guidlelines to the confession must be met.
WBTS claims they met the guidelines with the JC. Plaintiffs say no way. WBTS says that their judicial committee is the same as once clergy person because all the elders on a JC are "clergy." (I think this is a strong argument, by the way. Similar arguments have been used to preserve attorney-client, when there was more than one lawyer present for discussions with the client). Plaintiffs say if there is more than one elder there, it defeats the confidentiality privilege, because there is no expectation that a confidence was maintainable with a third person in the room.
The other, weaker argument that WBTS makes is that all the paper work that they completed, and the records that they kept are a result of these confidential communications, and as such, those too should be confidential. On the other hand, the plaintiffs have put forth that by reason of these publications, and that they were sent to HQ, the JC has shown its intent NOT to keep the matter confidential. The reason I think the court doesn't buy the defense's argument on this, is because the JC itself publicized the JC results. At a minimum, they may have announced that penitent (the child molester) was DFed, or more full breach of confidentiality occurred by sending the complete reports with additional facts learned from the JC to the society and other congregations in which the penitent may attend.
What the court recognizes is that when the clergy reveals the confidence (in any circumstance, beyond the sanctity of the confessional), the clergy cannot claim the privilege. So, WBTS can't then claim the privilege and have all these records of what they knew about the molester excluded from evidence at trial.
The plaintiff wants this evidence in to show that WBTS KNEW about the molester, and with that knowledge comes responsibility. But traditionally this confidnetiality privilege was to protect the penitent, and not the church. Here, the church wants to keep the paperwork private to protect itself, not the penitent. And yet, it was church's publication of the information to other parties that "broke" the confidentiality protections. It's being used against the church, and not against the penitent, who does not stand to be prejudiced by the discovery of these documents. His culpability is not really at dispute here anyway.