NetApp, Inc. v. Nimble Storage, Inc. et al

Filing 109

ORDER by Judge Lucy Koh denying 85 Administrative Motion to File Under Seal; denying 96 Administrative Motion to File Under Seal (lhklc2S, COURT STAFF) (Filed on 1/29/2015)

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UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION

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United States District Court
For the Northern District of California

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NETAPP INC.,
Plaintiff,

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v.
NIMBLE STORAGE, INC., MICHAEL
REYNOLDS, an individual, and Does 1-50,

Defendants.

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Case No.:13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE
MOTIONS TO SEAL

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Before the court are two administrative motions to seal various documents filed in
conjunction with Plaintiff NetApp Inc.’s (“NetApp”) motion for leave to file sur-reply in
opposition to Nimble Storage, Inc.’s and Michael Reynolds’s (collectively, “Defendants”) motion
to dismiss, as well as Defendants’ motion to strike. See ECF Nos. 85 & 96.
“Historically, courts have recognized a ‘general right to inspect and copy public records and
documents, including judicial records and documents.’” Kamakana v. City & Cnty. of Honolulu,
447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 597
& n.7 (1978)). Accordingly, when considering a sealing request, “a strong presumption in favor of
access is the starting point.” Id. (internal quotation marks omitted).
Parties seeking to seal judicial records relating to dispositive motions bear the burden of
overcoming this presumption with “compelling reasons supported by specific factual findings” that
outweigh the general history of access and the public policies favoring disclosure. Kamakana, 447
F.3d at 1178-79. Compelling reasons justifying the sealing of court records generally exist “when
Case No.: 13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE MOTIONS TO SEAL

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United States District Court
For the Northern District of California

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such ‘court files might have become a vehicle for improper purposes,’ such as the use of records to
gratify private spite, promote public scandal, circulate libelous statements, or release trade secrets.”
Id. at 1179 (quoting Nixon, 435 U.S. at 598). However, “[t]he mere fact that the production of
records may lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will
not, without more, compel the court to seal its records.” Id. Motions to dismiss are typically
treated as dispositive motions. See In re PPA Products Liability Litigation, 460 F.3d 1217, 1231
(9th Cir. 2006).
Records attached to nondispositive motions are not subject to the strong presumption of
access. See Kamakana, 447 F.3d at 1179. Because the documents attached to nondispositive
motions “are often unrelated, or only tangentially related, to the underlying cause of action,”
parties moving to seal must meet the lower “good cause” standard of Rule 26(c) of the Federal
Rules of Civil Procedure. Id. at 1179-80 (internal quotation marks omitted). The “good cause”
standard requires a “particularized showing” that “specific prejudice or harm will result” if the
information is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206,
1210-11 (9th Cir. 2002) (internal quotation marks omitted); see Fed. R. Civ. P. 26(c). “Broad
allegations of harm, unsubstantiated by specific examples of articulated reasoning” will not suffice.
Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992). In general, motions to
strike are treated as non-dispositive. ASUS Computer Int’l v. Round Rock Research, LLC, No. 12CV-02099 JST (NC), 2014 WL 2810193, at *2 (N.D. Cal. June 20, 2014) (citing Guzik Technical
Enters, Inc. v. W. Digital Corp., 2013 WL 6070414 (N.D. Cal. Nov. 18, 2013)).
Pursuant to Rule 26(c), a trial court has broad discretion to permit sealing of court
documents for, inter alia, the protection of “a trade secret or other confidential research,
development, or commercial information.” Fed. R. Civ. P. 26(c)(1)(G). The Ninth Circuit has
adopted the definition of “trade secrets” set forth in the Restatement of Torts, holding that “[a]
trade secret may consist of any formula, pattern, device or compilation of information which is
used in one’s business, and which gives him an opportunity to obtain an advantage over
competitors who do not know or use it.” Clark v. Bunker, 453 F.2d 1006, 1009 (9th Cir. 1972)
(quoting Restatement (First) of Torts § 757 cmt. b). “Generally [a trade secret] relates to the
production of goods. . . . It may, however, relate to the sale of goods or to other operations in the
Case No.: 13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE MOTIONS TO SEAL

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business. . . .” Id. (ellipses in original). In addition, the Supreme Court has recognized that sealing
may be justified to prevent judicial documents from being used “as sources of business information
that might harm a litigant’s competitive standing.” Nixon, 435 U.S. at 598.
In addition, parties moving to seal documents must comply with the procedures established
by Civil Local Rule 79-5. Pursuant to that rule, a sealing order is appropriate only upon a request
that establishes the document is “sealable,” or “privileged or protectable as a trade secret or
otherwise entitled to protection under the law.” Civ. L. R. 79-5(b). “The request must be narrowly
tailored to seek sealing only of sealable material, and must conform with Civil L.R. 79-5(d).” Id.
Civil Local Rule 79-5(d), moreover, requires the submitting party to attach a “proposed order that
is narrowly tailored to seal only the sealable material” and that “lists in table format each document
or portion thereof that is sought to be sealed,” as well as an “unredacted version of the document”
that “indicate[s], by highlighting or other clear method, the portions of the document that have
been omitted from the redacted version.” Id. R. 79-5(d)(1). “Within 4 days of the filing of the
Administrative Motion to File Under Seal, the Designating Party must file a declaration as required
by subsection 79-5(d)(1)(A) establishing that all of the designated material is sealable.” Id. R. 795(e)(1).
Here, the documents submitted under seal were filed in conjunction with a motion for leave
to file sur-reply in opposition to a motion to dismiss (generally regarded as a dispositive motion)
and a motion to strike (generally regarded as non-dispositive), as well as the subsequent sur-reply
itself. Therefore, NetApp’s motions to seal relate to a sur-reply that is arguably both dispositive
and non-dispositive. However, all the documents subject to NetApp’s first motion to seal (ECF
No. 85) are cited by NetApp in support of its opposition to Defendants’ motion to dismiss, which is
a dispositive motion. Specifically, NetApp cites these documents to argue that they show
Defendant Reynolds is a direct employee of Nimble and not Nimble AUS, a separate but related
entity. See, e.g., ECF No. 85-3, at 4-5 (citing and discussing documents related to Reynolds’
employment, which NetApp argues goes to show why Nimble is vicariously liable for Reynolds’
actions). Therefore, because NetApp relies on these documents to support arguments related to a
dispositive motion, the Court applies the “compelling reasons” standard to NetApp’s first motion to
seal (ECF No. 85).
Case No.: 13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE MOTIONS TO SEAL

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With respect to the three documents filed under seal in conjunction with NetApp’s second

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motion to seal (ECF No. 96), NetApp cites two of these documents (ECF Nos. 96-5 & 96-6) to
support NetApp’s arguments related to its opposition to Defendants’ motion to strike, which is a
non-dispositive motion. See, e.g., ECF No. 93-3, at 7 (citing and discussing documents to argue
that Defendants will not suffer prejudice as required in a motion to strike). NetApp’s second
motion to seal also seeks to seal a third document, ECF No. 96-4, which NetApp cites in support of
its opposition to Defendants’ motion to dismiss, a dispositive motion. See ECF No. 96-3, at 6.
Therefore, with regards to NetApp’s second motion to seal, the Court applies the “compelling
reasons” standard to ECF No. 96-4, and the “good cause” standard to ECF No. 96-5 and 96-6.
With these standards in mind, the Court rules on the instant motions as follows:

United States District Court
For the Northern District of California

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Motion
85

ECF No.
85-3

Document
NetApps’ Administrative
Motion for Leave to File SurReply in Opposition to
Defendants’ Motions to Dismiss
and Strike

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85-4

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85-5

Declaration of Karineh
Khachatourian in Support of
NetApp’s Administrative
Motion for Leave to File SurReply in Opposition to
Defendants’ Motion to Dismiss
and Motion to Strike
(“Khachatourian Decl.”)
Khachatourian Decl. Ex. C

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85-6

Khachatourian Decl. Ex. D

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85-7

Khachatourian Decl. Ex. E

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Case No.: 13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE MOTIONS TO SEAL

Ruling
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The

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85

85-8

Khachatourian Decl. Ex. F

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85-9

Khachatourian Decl. Ex. G

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85-10

Khachatourian Decl. Ex. H

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85-11

Khachatourian Decl. Ex. I

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85-11

Khachatourian Decl. Ex. J

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96-3

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96-4

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96-5

NetApp’s Sur-Reply in
Opposition to Defendants’
Motion to Dismiss and Strike
Declaration of Karineh
Khachatourian in Support of
NetApp, Inc.’s Sur-Reply in
Opposition to Defendant’s
Motion to Dismiss and Strike
(“Sur-Reply Decl.”)
Sur-Reply Decl. Ex. A

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96

96-6

Sur-Reply Decl. Ex. B

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96-7

Sur-Reply Decl. Ex. C

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Case No.: 13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE MOTIONS TO SEAL

designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED without prejudice. The request
to seal is overbroad because it seeks to
seal non-sealable material. The
designating party may submit a renewed
request to seal that is narrowly tailored
to seek sealing only of material that is
sealable. See Civil L. R. 79-5(b).
DENIED with prejudice because no
supporting declaration was ever filed.
DENIED with prejudice because no
supporting declaration was ever filed.

DENIED with prejudice because no
supporting declaration was ever filed.
DENIED with prejudice because no
supporting declaration was ever filed.
DENIED with prejudice because no

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supporting declaration was ever filed.

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IT IS SO ORDERED.
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Dated: January 29, 2015

_________________________________
LUCY H. KOH
United States District Judge

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United States District Court
For the Northern District of California

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Case No.: 13-CV-05058-LHK
ORDER DENYING ADMINISTRATIVE MOTIONS TO SEAL