It looks like this change breaks a pattern that used to work before e.g.:

sealed abstract class Tree[+A](
  final val key: A
)
final class RedTree[+A](key: A) extends Tree[A](key)
object RedTree {
  def unapply[A](t: RedTree[A]) = Some((t.key))
}

Since we prefer choosing private members when there are multiple denotations, then this example breaks, since:

1. Parameter key from RedTree is private local at first
2. We try accessing it from the companion object and make it non local as a consequence
3. It becomes private, so it clashes with the inherited final val key

The decision was to also allow for class parameters to be inferred as private local, but looks like it might be a trade-off.

Note: I tried changing the compiler, so that the non-private denotation is preferred, but that broke too many things.