Barnes et al v. The Hershey Company

Filing 258

ORDER by Judge Charles R. Breyer denying 234 Administrative Motion to File Under Seal; granting in part and denying in part 239 Administrative Motion to File Under Seal; denying 245 Administrative Motion to File Under Seal; granting 248 Administrative Motion to File Under Seal; granting 253 Administrative Motion to File Under Seal (crblc2, COURT STAFF) (Filed on 4/21/2015)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

United States District Court
For the Northern District of California

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GREGORY P. BARNES, ET AL.,
Plaintiffs,

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No. 3:12-cv-01334-CRB
ORDER GRANTING IN PART AND
DENYING IN PART
ADMINISTRATIVE MOTIONS TO
SEAL

v.
THE HERSHEY COMPANY,
Defendant.

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Now before the Court are a series of administrative motions to file documents under

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seal in connection with the parties’ pending cross motions for summary judgment. In the

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context of dispositive motions, as here, the Court starts with “a strong presumption in favor

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of access to court records.” See Foltz v. State Farm Mutual Auto. Insurance Company, 331

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F.3d 1122, 1135 (9th Cir. 2003) (citing Hagestad v. Tragesser, 49 F.3d 1430, 143 (9th

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Cir.1995) (recognizing strong presumption in context of civil trial)). In other words, “to

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retain any protected status for documents attached to a summary judgment motion, the

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proponent must meet the ‘compelling reasons' standard and not the lesser ‘good cause’

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determination.” Kamakana v. City and County of Honolulu, 447 F.3d 1172, 1177 (9th Cir.

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2006) (quoting Foltz, 331 F.3d at 1135). “The common law right of access, however, is not

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absolute and can be overridden given sufficiently compelling reasons for doing so.” Foltz,

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331 F.3d at 1135 (citing San Jose Mercury News, Inc. v. United States District Court–

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Northern District (San Jose), 187 F.3d 1096, 1102 (9th Cir. 1999). In making the

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determination whether to grant a motion to file under seal, “courts should consider all

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relevant factors, including the public interest in understanding the judicial process and

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whether disclosure of the material could result in improper use of the material for scandalous

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or libelous purposes or infringement upon trade secrets. . . . After taking all relevant factors

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into consideration, the district court must base its decision on a compelling reason and

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articulate the factual basis for its ruling, without relying on hypothesis or conjecture.” Id.

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(quoting Hagestad, 49 F.3d at 1434). This determination involves “balanc[ing] the

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competing interests of the public and the party seeking to seal judicial records.” In re

United States District Court
For the Northern District of California

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Midland Nat. Life Ins. Co. Annuity Sales Practices Litig., 686 F.3d 1115, 1119 (9th Cir.

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2012) (citing Kamakana, 447 F.3d at 1179). “A ‘good cause’ showing will not, without

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more, satisfy a ‘compelling reasons’ test.” Kamakana, 447 F.3d at 1180. The Ninth Circuit

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has explained that “compelling reasons” that justify sealing court records generally exist

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“when such ‘court files might have become a vehicle for improper purposes,’ such as the use

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of records to gratify private spite, promote public scandal, circulate libelous statements, or

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release trade secrets.” Id. at 1179 (quoting Nixon v. Warner Communications, 435 U.S. 589,

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598 (1978)). “The mere fact that the production of records may lead to a litigant's

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embarrassment, incrimination, or exposure to further litigation will not, without more,

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compel the court to seal its records.” Id. (citing Foltz, 331 F.3d at 1136).

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With these standards in mind, the Court turns to the motions at hand. Docket 239 is

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Plaintiffs’ administrative motion to file under seal certain documents that Defendant The

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Hershey Company (“Hershey”) has designated as confidential pursuant to a Stipulated

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Protective Order. Specifically, Plaintiff refers to Exhibits 16 to 19, 21 to 24, 26 to 74, and 76

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to 102 of the declaration of Brian J. Malloy. Plaintiffs seek to use the listed documents in

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Plaintiffs’ motion for partial summary judgment on Defendant’s affirmative defense of

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waiver. As required by Civil Local Rule 79-5(d), Hershey timely filed a declaration that the

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designated information is sealable. See Brigham Decl. (dkt. 241). Puzzlingly, however,

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Hershey appears to justify the sealing of these and all other exhibits under the “good cause”
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standard that governs the sealing of documents attached to a non-dispositive motion, rather

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than the “compelling reasons” standard that governs documents attached to a dispositive

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motion, as here. See Kamakana v. City & Cnty. of Honolulu, 447 F.3d 1172, 1178–80 (9th

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Cir.2006). Hershey also fails to submit the narrowly tailored proposed sealing order that

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Rule 79–5(d) requires. Instead, Hershey justifies the sealing of the documents in their

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entirety on general grounds relating to confidential business information and that the

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documents should be sealed in their entirety because they are designated confidential in their

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entirety by defendant. See Brigham Decl. at 2.
The Court has reviewed each and every document sought to be filed under seal, and

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United States District Court
For the Northern District of California

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makes the following findings. As an initial matter, Hershey does not assert that exhibits 77

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to 79 and 93 to 102 are sealable, so the motion to seal is DENIED as to these exhibits. See

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Brigham Decl. Exhibits 16 to 19, 21 to 22, 26 to 27, 35, 38 to 40, 50 to 53, 55 to 59, 61 to

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74, 82, and 84 are sealable in their entirety because they contain confidential and private

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information about Hershey’s business strategy and trade secrets, including internal operations

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information, account assignments and divisions, financial information regarding specific

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clients, and Hershey’s organization structure and sales strategies. Moreover, because the

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matters at issue in these particular exhibits focus on Hershey’s trade secrets and bear only

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tangentially on the employment matters at the heart of this litigation, the public’s interest in

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understanding the judicial process is minimal with respect to these exhibits. Accordingly, the

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motion to file under seal as it relates to these exhibits is GRANTED.

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However, Exhibits 23 to 24, 28 to 34, 36 to 37, 41 to 43, 49, 54, 60, 80 to 81, and 85

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to 92 contain information about the performance reviews and termination decisions regarding

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various employees. Hershey states in general terms that these documents contain

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“confidential information” about “several nonparty individual employees,” see Brigham

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Decl. at 2, but many of these documents appear to contain, in whole or in part, information

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about party employees—in fact, about the termination decisions at the heart of this litigation.

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It is not clear to this Court what compelling reasons justify keeping this information under

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seal, and Hershey provides little help in this regard. In fact, to the extent that the exhibits
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bear on the performance reviews and termination decisions about parties (as opposed to

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other, non-party employees) to this litigation, which centers on whether the parties were

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terminated for improper reasons, it appears that privacy interests are minimal and that the

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public’s interest in the disclosure of these documents for the legitimacy of the judicial

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process is heightened.
The same applies to Docket 234, in which Hershey seeks to file under seal a copy of a

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portion of its responses and objections to Plaintiffs’ interrogatories, which appears as Exhibit

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7 to the declaration of Brandon J. Brigham in support of Defendant’s motion for partial

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summary judgment. Though the exhibit contains confidential information about non-parties’

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United States District Court
For the Northern District of California

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terminations from employment and their personal identifying information, it also appears to

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contain information about the termination of parties to this litigation. Hershey did not

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differentiate between these two groups, and it is not the Court’s responsibility to narrowly

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tailor a sealing order on Hershey’s behalf. See Civil Local Rule 79-5(a), (d).

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Accordingly, the motions to seal are DENIED as to Exhibit 7 in Docket 234 and

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exhibits 23 to 24, 28 to 34, 36 to 37, 41 to 43, 49, 54, 60, 80 to 81, and 85 to 92 in Docket

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239 for failure to comply with Civil Local Rule 79–5(a)–(b), (d), which require that requests to seal

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be narrowly tailored. No later than seven days from the date of this Order, Hershey may resubmit a

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modified version of its declaration, which shall include a narrowly tailored version of this sealing

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request and shall specify which if any of these exhibits, and which specific parts thereof, must be

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sealed to protect the privacy rights of non-parties or other compelling reasons in support.

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As to Exhibits 44, 45 to 48, 76, and 83 in Docket 239, Hershey does not limit its request only

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to confidential material, and the documents appear to contain substantial unsealable information

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about termination decisions relating to parties to this litigation or other aspects of this litigation more

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generally. Accordingly, the motion is DENIED for Hershey’s failure to comply with Civil Local

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Rule 79–5(d), which requires that requests to seal be narrowly tailored. See Brigham Decl. at 2–3.

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Hershey may resubmit a modified version of its declaration, which shall include a narrowly tailored

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version of this sealing request and shall specify which if any of these exhibits, and which specific

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parts thereof, must be sealed to protect the privacy rights of non-parties or other compelling reasons
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in support.
Docket 245 is Plaintiffs’ administrative motion to file under seal a list of documents that

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Hershey designated as confidential. Of that list, Hershey’s Rule 79(d) declaration only seeks to seal

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the redacted portions of Plaintiff’s Opposition and Exhibit A to the Malloy declaration, which is

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Hershey’s Supplemental Responses to Plaintiff’s Interrogatories pursuant to the Court’s September

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5, 2014 Order. See Brigham Decl. (dkt. 249). But Hershey’s justification for keeping this material

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under seal suffers from the same infirmities. For one thing, Hershey (which again cites the incorrect

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“good cause” standard) states that the material contains confidential information “regarding

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Hershey’s business matters and several nonparty individual employees, the disclosure of which may

United States District Court
For the Northern District of California

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lead to annoyance, undue burden or expense.” See Brigham Decl. at 2. But on the Court’s own

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review of Exhibit A, it appears to contain information about both non-parties and about the

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terminations of parties that are at the heart of this litigation. Moreover, Hershey does not argue that

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Exhibits B–J should be sealed, and yet seeks to seal all the redacted portions of Plaintiffs’

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Opposition, including those that refer to these latter exhibits. Accordingly, the motion is DENIED

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for Hershey’s failure to comply with Civil Local Rule 79–5(d), which requires that requests to seal

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be narrowly tailored. See Brigham Decl. at 2–3. Hershey may resubmit a modified version of its

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declaration, which shall include a narrowly tailored version of this sealing request and shall specify

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which if any parts of Exhibit A and of Plaintiffs’ Opposition, must be sealed to protect the privacy

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rights of non-parties or other compelling reasons in support.

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Docket 248 is Plaintiff’s administrative motion to file under seal Exhibit A to Plaintiffs’

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motion for relief from a nondispositive pretrial order of a magistrate judge. Exhibit A contains a

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series of emails with a roster of Hershey’s sales employees and information regrading specific

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customers, strategies, and sales targets. The emails are brief and do not contain significant

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unsealable information. Moreover, the public interest in these emails is minimal, as they relate to a

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technical matter in a discovery order and bear only tangentially, if at all, to the questions at issue in

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the litigation. And as this sealing order relates only to a nondispositive motion, it is subject only to a

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“good cause” determination. See Kamakana, 447 F.3d at 1177. Accordingly, the Court finds good

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cause to maintain the confidentiality of Exhibit A and GRANTS the motion to seal.
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Finally, Docket 253 is Hershey’s administrative motion to file under seal documents in
further support of its motion for partial summary judgment and in opposition to Plaintiffs’ motion

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for partial summary judgment. Specifically, Hershey seeks to seal certain redacted portions of

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Hershey’s opposition to Plaintiffs’ motion for partial summary judgment and Exhibits 10 and 23 of

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the declaration of Brandon J. Bingham. Exhibit 10 is an email of a detailed recap of a sales and

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recruitment strategy meeting. Exhibit 23 is a detailed chart of Hershey’s client list, revenues, and

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management distribution plans. The Court agrees with Hershey’s representations that disclosure of

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these emails would put Hershey at a competitive disadvantage by revealing its internal talent

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planning and client management strategies. Additionally, the emails bear only tangentially on the

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United States District Court
For the Northern District of California

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matters at issue in this litigation, such that the public interest in disclosure is minimal. The same

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goes for the redacted portions of Hershey’s opposition to Plaintiff’s motion for partial summary

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judgment, because those limited excerpts describe trade secrets and management strategies, the

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disclosure of which would compromise Hershey’s competitive standing. Accordingly, the Court

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finds compelling reasons to seal the material at issue in Docket 253, and GRANTS the motion.

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CONCLUSION

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For the foregoing reasons, the Court’s ruling are as follows. As to Docket 234, the motion to

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seal is DENIED. As to Docket 239, the motion to seal is granted with respect to Exhibits 16 to 19,

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21 to 22, 26 to 27, 35, 38 to 40, 50 to 53, 55 to 59, 61 to 74, 82, and 84. The motion to seal is

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DENIED with respect to Exhibits 23 to 24, 28 to 34, 36 to 37, 41 to 43, 49, 54, 60, 80 to 81, and 85

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to 92, and with respect to Exhibits 44, 45 to 48, 76, and 83. As Hershey does not seek to seal

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Exhibits 77 to 79 and 93 to 102, the motion to seal those exhibits is DENIED. As to Docket 245, the

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motion is DENIED. As to Docket 248, the motion is GRANTED. As to Docket 253, the motion is

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GRANTED.

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With respect to the motions that were denied for failure to comply with Rule 79-5: Hershey

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may submit a supplemental declaration establishing that the designated information is sealable to the

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satisfaction of the standards for dispositive motions as described in this Order and supporting case

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law. Any supplemental declarations must include the narrowly tailored proposed sealing order

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required by Rule 79-5(d), and must be filed within 7 days of the date of this Order. Any material not
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supported by a supplemental declaration, or not supported by one that provides specific “compelling

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reasons” for seal, will be filed in the public record.

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IT IS SO ORDERED.

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Dated: April 21, 2015

CHARLES R. BREYER
UNITED STATES DISTRICT JUDGE

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United States District Court
For the Northern District of California

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