Ojmar US, LLC v. Security People, Inc. et al

Filing 134

ORDER by Judge Haywood S. Gilliam, Jr. GRANTING AND DENYING IN PART ADMINISTRATIVE MOTIONS TO SEAL Re Docket Nos. 119 , 124 and 127 Administrative Motion to File Under Seal. (ndrS, COURT STAFF) (Filed on 11/29/2017)

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1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 OJMAR US, LLC, Plaintiff, 8 v. 9 10 SECURITY PEOPLE, INC., et al., ORDER GRANTING AND DENYING IN PART ADMINISTRATIVE MOTIONS TO SEAL Re: Dkt. Nos. 119, 124, 127 Defendants. 11 United States District Court Northern District of California Case No. 16-cv-04948-HSG 12 Pending before the Court are three unopposed administrative motions to seal information 13 14 relating to Security People, Inc. (“Digilock”) and Asil Gokcebay’s (collectively, “Defendants”) 15 motion to dismiss the second amended complaint filed by Plaintiff Ojmar U.S., LLC (“Ojmar”). 16 Dkt. Nos. 119, 124, 127. The Court GRANTS Defendants’ administrative motions to seal and 17 DENIES in part Plaintiff’s administrative motion to seal. 18 19 I. LEGAL STANDARD Courts generally apply a “compelling reasons” standard when considering motions to seal 20 documents. Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 677–78 (9th Cir. 2010). “This standard 21 derives from the common law right ‘to inspect and copy public records and documents, including 22 judicial records and documents.’” Id. (quoting Kamakana v. City & Cnty. of Honolulu, 447 F.3d 23 1172, 1178 (9th Cir. 2006)). “[A] strong presumption in favor of access is the starting point.” 24 Kamakana, 447 F.3d at 1178 (quotation marks and citation omitted). To overcome this strong 25 presumption, the moving party must “articulate compelling reasons supported by specific factual 26 findings that outweigh the general history of access and the public policies favoring disclosure, 27 such as the public interest in understanding the judicial process.” Id. at 1178–79 (citations, 28 quotation marks, and alterations omitted). “In general, compelling reasons sufficient to outweigh 1 the public’s interest in disclosure and justify sealing court records exist when such court files 2 might have become a vehicle for improper purposes, such as the use of records to gratify private 3 spite, promote public scandal, circulate libelous statements, or release trade secrets.” Id. at 1179 4 (quotation marks and citation omitted). The Court must 5 6 7 8 9 balance the competing interests of the public and the party who seeks to keep certain judicial records secret. After considering these interests, if the Court decides to seal certain judicial records, it must base its decision on a compelling reason and articulate the factual basis for its ruling, without relying on hypothesis or conjecture. Id. (citations, brackets, and quotation marks omitted). Civil Local Rule 79-5 supplements the “compelling reasons” standard. The party seeking to file under seal must “establish[] that the document, or portions thereof, are privileged, 11 United States District Court Northern District of California 10 protectable as a trade secret or otherwise entitled to protection under the law . . . The request must 12 be narrowly tailored to seek sealing only of sealable material . . . .” Civil L.R. 79-5(b). Courts 13 also “regularly find that litigants may file under seal contracts with third parties that contain 14 proprietary and confidential business information.” See Finisar Corp. v. Nistica, Inc., No. 13-cv- 15 03345-BLF (JSC), 2015 WL 3988132, at *5 (N.D. Cal. June 30, 2015); In re Qualcomm Litig., 16 No. 3:17-CV-0108-GPC-MDD, 2017 WL 5176922, at *2 (S.D. Cal. Nov. 8, 2017) (finding that 17 “license agreements, financial terms, details of confidential licensing negotiations, and business 18 strategies” containing “confidential business information” satisfied the “compelling reasons” 19 standard in part because sealing that information “prevent[ed] competitors from gaining insight 20 into the parties’ business model and strategy”). 21 Finally, records attached to motions that are only “tangentially related to the merits of a 22 case” are not subject to the strong presumption of access. Ctr. for Auto Safety v. Chrysler Grp., 23 LLC, 809 F.3d 1092, 1101 (9th Cir. 2016). Accordingly, parties moving to seal such records need 24 only meet the lower “good cause” standard of Rule 26(c) of the Federal Rules of Civil Procedure. 25 Id. at 1097. The “good cause” standard requires a “particularized showing” that “specific 26 prejudice or harm will result” if the information is disclosed. Phillips ex rel. Estates of Byrd v. 27 Gen. Motors Corp., 307 F.3d 1206, 1210–11 (9th Cir. 2002) (citation and internal quotation marks 28 omitted); see also Fed. R. Civ. P. 26(c). 2 II. 1 DISCUSSION Defendants seek to seal information contained in (1) Defendants’ motion to dismiss 2 3 Plaintiff’s second amended complaint; (2) exhibits attached to the motion; and (3) Defendants’ 4 reply in support of the motion. See Dkt. Nos. 119, 127. Defendants indicate that the information 5 to be sealed concerns pricing information and other “confidential business information.” Dkt. No. 6 119 at 2. The Court has already agreed to seal some of this information as it appears in Plaintiff’s 7 second amended complaint. See Dkt. Nos. 115–116. Plaintiff also seeks to seal portions of its 8 opposition to Defendants’ motion to dismiss based on Defendants’ claim of confidential 9 information. Dkt. No. 124 at 1–3. Plaintiff takes no position on whether the Court should seal any of the information contained in its opposition and identified by Defendant as confidential. Id. 11 United States District Court Northern District of California 10 at 2–3 (“Ojmar files this administrative motion for the sole purpose of affording Security People 12 the opportunity to defend its confidentially designations as provided by Civil Local Rule 79- 13 5(e).”). The Court applies the “compelling reasons” standard to the documents at issue, as those 14 15 documents bear more than a tangential relation to the merits of the case. See Ctr. for Auto Safety, 16 809 F.3d at 1101. The information identified as sealable by Defendants in the motion to dismiss 17 and supporting exhibits, as well as in Defendants’ reply in support of the motion, satisfies the 18 compelling reasons standard because it is confidential business information. See In re Qualcomm 19 Litig., 2017 WL 5176922, at *2. In contrast, Plaintiff’s sealing request does not satisfy the compelling reasons standard 20 21 because it is not narrowly tailored. Plaintiff seeks to seal entire business agreements that are 22 substantially similar to those agreements that Defendants seek to seal. Compare Dkt. No. 119-1 23 (“Woods Decl.”) Exs. B–D, with Dkt. No. 124-1 (“Callaway Decl.”) Exs. A–C. Defendants, 24 however, sought only to seal portions of those agreements providing specific pricing information. 25 See id. Plaintiff does not explain why the Court should seal these documents in their entirety, and 26 Defendants likewise do not explain this discrepancy in their declaration of support for Plaintiff’s 27 request to seal. See Dkt. No. 126. 28 //// 3 1 The Court accordingly GRANTS Defendants’ administrative motions to seal, and 2 DENIES in part Plaintiff’s administrative motion to seal. The following summary table sets forth 3 the Court’s specific rulings as they relate to each document to be sealed: 4 Motion 119 Document Mot. to Dismiss Ruling GRANTED Portions Sealable Highlighted portions 6 119 Woods Decl., Ex. A GRANTED Highlighted portions 7 119 Woods Decl., Ex. B GRANTED Highlighted portions 8 119 Woods Decl., Ex. C GRANTED Highlighted portions 9 119 Woods Decl., Ex. D GRANTED Highlighted portions 10 119 Woods Decl., Ex. E GRANTED Entire Document 11 United States District Court Northern District of California 5 119 Woods Decl., Ex. F GRANTED Entire Document 12 119 Woods Decl., Ex. G GRANTED Entire Document 13 124 GRANTED Highlighted portions 14 124 Opp. to Mot. to Dismiss Callaway Decl. GRANTED Highlighted portions 15 124 Callaway Decl., Ex. A DENIED Entire Document Confidential Business Information Not narrowly tailored 16 124 Callaway Decl., Ex. B DENIED Entire Document Not narrowly tailored 17 124 Callaway Decl., Ex. C DENIED Entire Document Not narrowly tailored 18 127 Reply in support of Mot. to Dismiss GRANTED Highlighted portions Confidential Business Information 19 Reason Confidential Business Information Confidential Business Information Confidential Business Information Confidential Business Information Confidential Business Information Confidential Business Information Confidential Business Information Confidential Business Information Confidential Business Information 20 Pursuant to Civil Local Rule 79-5(f)(1), those documents filed under seal as to which the 21 administrative motions are granted in full will remain under seal and the public will have access 22 only to the redacted versions accompanying the administrative motions. 23 24 25 26 IT IS SO ORDERED. Dated: 11/29/2017 ______________________________________ HAYWOOD S. GILLIAM, JR. United States District Judge 27 28 4

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