Softvault Systems, Inc v. Sybase, Inc.

Filing 50

ORDER by Judge Lucy H. Koh denying 38 Administrative Motion to File Under Seal; denying 40 Stipulation (lhklc2, COURT STAFF) (Filed on 9/19/2012)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
For the Northern District of California

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SOFTVAULT SYSTEMS, INC.,
Plaintiff,

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v.

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SYBASE, INC.,

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Defendant.

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AND ALL RELATED ACTIONS

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Case No.: 12-CV-01099-LHK
Related Case No.: 12-CV-01658-LHK
Related Case No.: 12-CV-01940-LHK
ORDER DENYING MOTION TO FILE
DOCUMENTS UNDER SEAL

Before the Court are Plaintiff Softvault Systems, Inc.’s Administrative Request to File

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Documents Under Seal (ECF No. 38) and a stipulation of Plaintiff and Defendant Sybase, Inc. in

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support of Plaintiff’s Administrative Request to File Documents Under Seal (ECF No. 40). The

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documents Plaintiff seeks to seal include portions of Plaintiff’s Motion for Summary Judgment and

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portions of declarations and exhibits filed in support of that motion.

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Historically, courts have recognized a “general right to inspect and copy public records and

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documents, including judicial records and documents.” Nixon v. Warner Commc’ns, Inc., 435 U.S.

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589, 597 & n. 7 (1978). Unless a particular court record is one “traditionally kept secret,” a “strong

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presumption in favor of access” is the starting point. Foltz v. State Farm Mutual Auto. Insurance

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Company, 331 F.3d 1122, 1135 (9th Cir. 2003). A party seeking to seal a judicial record then bears

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the burden of overcoming this strong presumption by meeting the “compelling reasons” standard.
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Case Nos.: 12-CV-01099-LHK; 12-CV-01658-LHK; 12-CV-01940-LHK
ORDER DENYING MOTION TO FILE DOCUMENTS UNDER SEAL

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Id. at 1135. That is, the party must “articulate[ ] compelling reasons supported by specific factual

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findings,” id. (citing San Jose Mercury News, Inc. v. U.S. Dist. Ct., 187 F.3d 1096, 1102-03 (9th

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Cir.1999)), 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.’” Hagestad, 49 F.3d at 1434

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(quoting EEOC v. Erection Co., 900 F.2d 168, 170 (9th Cir. 1990)).

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The Ninth Circuit has explained that the “strong presumption of access to judicial records

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applies fully to dispositive pleadings, including motions for summary judgment and related

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attachments” because “the resolution of a dispute on the merits, whether by trial or summary

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judgment, is at the heart of the interest in ensuring the public’s understanding of the judicial

United States District Court
For the Northern District of California

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process and of significant public events.” Kamakana v. City and County of Honolulu, 447 F.3d

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1172, 1177 (9th Cir. 2006) (internal citation omitted). The Ninth Circuit has also carved out an

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exception to the strong presumption of openness for pre-trial, non-dispositive motions. The Ninth

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Circuit applies a “good cause” showing to keep sealed records attached to non-dispositive motions.

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Id. at 1180. Thus the Court applies a two tiered approach: “judicial records attached to dispositive

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motions [are treated] differently from records attached to non-dispositive motions. Those who seek

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to maintain the secrecy of documents attached to dispositive motions must meet the high threshold

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of showing that ‘compelling reasons’ support secrecy” while a showing of good cause will suffice

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at earlier stages of litigation. Id.

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In light of the Ninth Circuit’s admonition in Kamakana regarding the presumption of

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openness and the high burden placed on sealing documents at the merits stage of the litigation, it

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appears that the parties have overdesignated confidential documents and are seeking to seal

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information that is not truly sealable under the “compelling reasons” standard. As one example,

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the parties have sought to seal the entire contents of a licensing agreement. Some aspects of

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licensing agreements may indeed meet the “compelling reasons” standard. In particular, the Ninth

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Circuit has held that pricing terms, royalty rates, and minimum payment terms of the licensing

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agreements are sealable. See In re Electronic Arts Inc., 298 Fed. App’x 568, 569 (9th Cir. 2008)

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(finding “pricing terms, royalty rates, and guaranteed minimum payment terms” of a license

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agreement to “plainly fall[] within the definition of ‘trade secrets’”). But this Court will not seal a
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Case Nos.: 12-CV-01099-LHK; 12-CV-01658-LHK; 12-CV-01940-LHK
ORDER DENYING MOTION TO FILE DOCUMENTS UNDER SEAL

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licensing agreement in its entirety. See Apple, Inc. v. Samsung Electronics Co., Ltd., 11-CV-

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01846-LHK, 2012 WL 3283478 at *6 (N.D. Cal. Aug. 9, 2012).

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As Judge Alsup explained in Oracle America v. Google, Inc., 10-CV-03561-WHA, at ECF

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No. 540, “The United States district court is a public institution, and the workings of litigation must

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be open to public view. Pretrial submissions are a part of trial.” Accordingly, Judge Alsup advised

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counsel that “unless they identify a limited amount of exceptionally sensitive information that truly

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deserves protection, the motions will be denied outright.” Id. Accordingly, the Request to File

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Documents Under Seal is DENIED without prejudice.

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The parties may file renewed motions to seal within one week of the date of this Order.

United States District Court
For the Northern District of California

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However, the parties are ORDERED to carefully scrutinize the documents they seek to seal. At

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this stage of the proceedings, the presumption of openness will apply to all documents and only

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documents of exceptionally sensitive information that truly deserve protection will be allowed to

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be redacted or kept from the public.

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IT IS SO ORDERED.

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Dated: September 19, 2012

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_________________________________
LUCY H. KOH
United States District Judge

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Case Nos.: 12-CV-01099-LHK; 12-CV-01658-LHK; 12-CV-01940-LHK
ORDER DENYING MOTION TO FILE DOCUMENTS UNDER SEAL