Navigators Specialty Insurance Company v. Depomed, Inc.

Filing 102

ORDER by Judge Haywood S. Gilliam, Jr. GRANTING ( 57 , 85 , 90 ) MOTIONS TO SEAL.(ndrS, COURT STAFF) (Filed on 11/25/2020)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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NAVIGATORS SPECIALTY
INSURANCE COMPANY,
Plaintiff,

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v.

ORDER GRANTING MOTIONS TO
SEAL
Re: Dkt. Nos. 57, 85, 90

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Case No. 19-cv-00255-HSG

DEPOMED, INC.,

United States District Court
Northern District of California

Defendant.
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Pending before the Court are the parties’ administrative motions to file under seal

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documents filed in connection with Plaintiff Navigator Specialty Insurance Company’s opposition

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to Defendant Depomed, Inc.’s motion for partial judgment on the pleadings, as well as the parties’

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respective motions for summary judgment. Dkt. Nos. 57, 85, 90. For the reasons detailed below,

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the Court GRANTS the administrative motions to seal.

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I.

LEGAL STANDARD
Courts generally apply a “compelling reasons” standard when considering motions to seal

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with documents. Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 678 (9th Cir. 2010) (quoting

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Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)). “This standard

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derives from the common law right ‘to inspect and copy public records and documents, including

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judicial records and documents.’” Id. (quoting Kamakana, 447 F.3d at 1178). “[A] strong

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presumption in favor of access is the starting point.” Kamakana, 447 F.3d at 1178 (quotations

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omitted). To overcome this strong presumption, the party seeking to seal a judicial record

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attached to a dispositive motion must “articulate compelling reasons supported by specific factual

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findings that outweigh the general history of access and the public policies favoring disclosure,

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such as the public interest in understanding the judicial process” and “significant public events.”

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Id. at 1178–79 (quotations omitted). “In general, ‘compelling reasons’ sufficient to outweigh the

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public’s interest in disclosure and justify sealing court records exist when such ‘court files might

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have become a vehicle for improper purposes,’ such as the use of records to gratify private spite,

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promote public scandal, circulate libelous statements, or release trade secrets.” Id. at 1179

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(quoting Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 598 (1978)). “The mere fact that the

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production of records may lead to a litigant’s embarrassment, incrimination, or exposure to further

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litigation will not, without more, compel the court to seal its records.” Id.
The Court must “balance[] the competing interests of the public and the party who seeks to

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keep certain judicial records secret. After considering these interests, if the court decides to seal

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certain judicial records, it must base its decision on a compelling reason and articulate the factual

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United States District Court
Northern District of California

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basis for its ruling, without relying on hypothesis or conjecture.” Id. Civil Local Rule 79-5

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supplements the compelling reasons standard set forth in Kamakana: the party seeking to file a

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document or portions of it under seal must “establish[] that the document, or portions thereof, are

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privileged, protectable as a trade secret or otherwise entitled to protection under the law . . . The

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request must be narrowly tailored to seek sealing only of sealable material.” Civil L.R. 79-5(b).
Records attached to nondispositive motions must meet the lower “good cause” standard of

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Rule 26(c) of the Federal Rules of Civil Procedure, as such records “are often unrelated, or only

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tangentially related, to the underlying cause of action.” See Kamakana, 447 F.3d at 1179–80

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(quotations omitted). This requires a “particularized showing” that “specific prejudice or harm

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will result” if the information is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp.,

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307 F.3d 1206, 1210–11 (9th Cir. 2002); see also Fed. R. Civ. P. 26(c). “Broad allegations of

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harm, unsubstantiated by specific examples of articulated reasoning” will not suffice. Beckman

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Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (quotation omitted).

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II.

DISCUSSION
Because the parties seek to seal portions and documents which pertain to Plaintiff’s motion

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for partial judgment on the pleadings and the parties’ motions for summary judgment, the Court

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applies the compelling reasons standard.

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First, Plaintiff filed a motion to file under seal certain exhibits filed in opposition to the
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motion for partial judgment on the pleadings and portions of the opposition brief and declaration

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that reference these exhibits. Dkt. No. 57. The parties also filed motions to file under seal certain

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exhibits filed in support of their motions for summary judgment, as well as portions of the brief

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and declarations that reference these exhibits. See Dkt. Nos. 85, 90. Defendant filed declarations

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in support of the motions to seal, explaining that the documents contain confidential

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communications to their insurers as well as subpoenas related to its defense in the underlying

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opioid litigation cases challenging Defendant’s sales and marketing of opioid products, which

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remain ongoing. See Dkt. Nos. 61, 86-1, 92. The Court finds that revealing the contents of these

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documents would prejudice Defendant’s defense in this pending or threatened litigation. See, e.g.,

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Montrose Chem. Corp. v. Superior Court, 25 Cal. App. 4th 902, 909–10 (Cal. 1994), as modified

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United States District Court
Northern District of California

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(June 30, 1994) (identifying several risks of prejudice, including that the insurer could “join forces

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with the plaintiffs in the underlying actions as a means to defeat coverage” and that the insured

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would then have “to fight a two-front war, doing battle with the plaintiffs in the third party

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litigation while at the same time devoting its money and its human resources to litigating coverage

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issues with its carriers”).
Second, the parties seek to file under seal exhibits that they each filed in support of their

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respective motions for summary judgment, which contain confidential information relating to their

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business operations. See Dkt. Nos. 85, 90. The unredacted information contains information

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disclosing confidential investigation and evaluations of risk related to Defendant’s insurance

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policy and related negotiations, as well as sales and pricing information related to Defendant’s

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products. See, e.g., Dkt. Nos. 86-1, 88, 90-1. According to the parties, public disclosure of such

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information would cause severe harm to them, as competitors could use the information to their

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disadvantage. See id. The Court finds that these requests therefore fall within the class of

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materials that may be filed under seal and are narrowly tailored. See, e.g., Google Inc. v. Eolas

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Techs. Inc., No. 15-CV-05446-JST, 2016 WL 9243337, at *2 (N.D. Cal. Mar. 22, 2016) Linex

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Techs., Inc. v. Hewlett-Packard Co., No. C 13-159 CW, 2014 WL 6901744 (N.D. Cal. Dec. 8,

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2014); Agency Solutions.Com, LLC v. TriZetto Group, Inc., 819 F. Supp. 2d 1001, 1017 (E.D. Cal.

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2011).
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III.

CONCLUSION

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The Court therefore GRANTS the parties’ administrative motions to file under seal.

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Pursuant to Civil Local Rule 79-5(f)(1), documents filed under seal as to which the administrative

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motions are granted will remain under seal.

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IT IS SO ORDERED.
Dated: 11/25/2020
______________________________________
HAYWOOD S. GILLIAM, JR.
United States District Judge

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United States District Court
Northern District of California

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