Towers v. Iger et al

Filing 53

ORDER GRANTING IN PART AND DENYING IN PART 48 ADMINISTRATIVE MOTION TO SEAL PORTIONS OF VERIFIED AMENDED STOCKHOLDER DERIVATIVE COMPLAINT. Signed by Judge Beth Labson Freeman on 10/31/2016. (blflc2S, COURT STAFF) (Filed on 10/31/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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EUGENE F. TOWERS,

Case No. 15-cv-04609-BLF

Plaintiff,
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v.
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ROBERT A. IGER, et al.,
Defendants.

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ORDER GRANTING IN PART AND
DENYING IN PART
ADMINISTRATIVE MOTION TO SEAL
PORTIONS OF VERIFIED AMENDED
STOCKHOLDER DERIVATIVE
COMPLAINT

United States District Court
Northern District of California

[Re: ECF 48]
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Before the Court is Plaintiff Eugene F. Towers’ administrative motion to seal portions of

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his verified amended stockholder derivative complaint. ECF 48. For the reasons discussed below,

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the motion is GRANTED IN PART and DENIED IN PART.

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I.

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

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and documents, including judicial records and documents.’” Kamakana v. City & Cty. of

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Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc’ns, Inc., 435

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U.S. 589, 597 & n. 7 (1978)). Accordingly, when considering a sealing request, “a ‘strong

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presumption in favor of access’ is the starting point.” Id. (quoting Foltz v. State Farm Mut. Auto.

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Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). Parties seeking to seal judicial records relating to

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motions that are “more than tangentially related to the underlying cause of action” bear the burden

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of overcoming the presumption with “compelling reasons” that outweigh the general history of

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access and the public policies favoring disclosure. Ctr. for Auto Safety v. Chrysler Grp., 809 F.3d

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1092, 1099 (9th Cir. 2016); Kamakana, 447 F.3d at 1178–79.

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However, “while protecting the public’s interest in access to the courts, we must remain

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mindful of the parties’ right to access those same courts upon terms which will not unduly harm

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their competitive interest.” Apple Inc. v. Samsung Elecs. Co., Ltd., 727 F.3d 1214, 1228–29 (Fed.

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Cir. 2013). Records attached to motions that are “not related, or only tangentially related, to the

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merits of a case” therefore are not subject to the strong presumption of access. Ctr. for Auto

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Safety, 809 F.3d at 1099; see also Kamakana, 447 F.3d at 1179 (“[T]he public has less of a need

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for access to court records attached only to non-dispositive motions because those documents are

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often unrelated, or only tangentially related, to the underlying cause of action.”). Parties moving

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to seal the documents attached to such motions must meet the lower “good cause” standard of

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Rule 26(c). Kamakana, 447 F.3d at 1179 (internal quotations and citations omitted). This

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standard requires a “particularized showing,” id., 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,

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United States District Court
Northern District of California

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1210–11 (9th Cir. 2002); see Fed. R. Civ. P. 26(c). “Broad allegations of harm, unsubstantiated

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by specific examples of articulated reasoning” will not suffice. Beckman Indus., Inc. v. Int’l Ins.

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Co., 966 F.2d 470, 476 (9th Cir. 1992). A protective order sealing the documents during

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discovery may reflect the court’s previous determination that good cause exists to keep the

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documents sealed, see Kamakana, 447 F.3d at 1179–80, but a blanket protective order that allows

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the parties to designate confidential documents does not provide sufficient judicial scrutiny to

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determine whether each particular document should remain sealed. See Civ. L.R. 79-5(d)(1)(A)

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(“Reference to a stipulation or protective order that allows a party to designate certain documents

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as confidential is not sufficient to establish that a document, or portions thereof, are sealable.”).

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In addition to making particularized showings of good cause, parties moving to seal

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documents must comply with the procedures established by Civ. L.R. 79-5. Pursuant to Civ. L.R.

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79-5(b), a sealing order is appropriate only upon a request that establishes the document is

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“sealable,” or “privileged or protectable as a trade secret or otherwise entitled to protection under

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the law.” “The request must be narrowly tailored to seek sealing only of sealable material, and

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must conform with Civil L.R. 79-5(d).” Civ. L.R. 79-5(b). In part, Civ. L.R. 79-5(d) requires the

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submitting party to attach a “proposed order that is narrowly tailored to seal only the sealable

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material” which “lists in table format each document or portion thereof that is sought to be

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sealed,” Civ. L.R. 79-5(d)(1)(b), and an “unredacted version of the document” that indicates “by
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highlighting or other clear method, the portions of the document that have been omitted from the

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redacted version.” Civ. L.R. 79-5(d)(1)(d). “Within 4 days of the filing of the Administrative

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Motion to File Under Seal, the Designating Party must file a declaration as required by subsection

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79-5(d)(1)(A) establishing that all of the designated material is sealable.” Civ. L.R. 79-5(e)(1).

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II.

DISCUSSION
The sealing motion at issue is resolved under the compelling reasons standard because a

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complaint is more than tangentially related to the merits of this case. With that standard in mind,

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the Court rules on the instant motion as follows:

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Paragraph
(Page: Line)
¶ 9 (3:14–4:4)

Result
GRANTED.

¶ 22 (8:3–8)

GRANTED.

¶¶ 125–140 (42:1–48:2)

GRANTED.

United States District Court
Northern District of California

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Reasoning
Relates to meetings of the Company’s board of
directors during which the directors discussed
confidential matters regarding the Company’s
acquisition of Pixar, Inc., including the board of
directors’ negotiations, strategic considerations for
entering into the acquisition, and post-acquisition
operational issues. These matters were not disclosed
at the time of the acquisition, and the Company has
maintained the confidentiality of that information
since.
Relates to meetings of the Company’s board of
directors during which the directors discussed
confidential matters regarding the Company’s
acquisition of Pixar, Inc., including the board of
directors’ negotiations, strategic considerations for
entering into the acquisition, and post-acquisition
operational issues. These matters were not disclosed
at the time of the acquisition, and the Company has
maintained the confidentiality of that information
since.
Relates to meetings of the Company’s board of
directors during which the directors discussed
confidential matters regarding the Company’s
acquisition of Pixar, Inc., including the board of
directors’ negotiations, strategic considerations for
entering into the acquisition, and post-acquisition
operational issues. These matters were not disclosed
at the time of the acquisition, and the Company has
maintained the confidentiality of that information
since.

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¶ 140 n.15 (48 n.15)

GRANTED.

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¶ 145 (50:13–16, 17–25) DENIED.

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III.

Relates to meetings of the Company’s board of
directors during which the directors discussed
confidential matters regarding the Company’s
acquisition of Pixar, Inc., including the board of
directors’ negotiations, strategic considerations for
entering into the acquisition, and post-acquisition
operational issues. These matters were not disclosed
at the time of the acquisition, and the Company has
maintained the confidentiality of that information
since.
The Company does not seek to have this portion of
the Amended Complaint filed under seal. Horvath
Decl. 2, ECF 50.

ORDER
For the foregoing reasons, the sealing motion at ECF 48 is GRANTED IN PART

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and DENIED IN PART. Under Civil Local Rule 79-5(f)(3), the document sought to be sealed will
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United States District Court
Northern District of California

not be considered by the Court unless the Submitting Party files a revised redacted version which
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comports with the Court’s order within 7 days of this order.

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IT IS SO ORDERED.
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Dated: October 31, 2016
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______________________________________
BETH LABSON FREEMAN
United States District Judge

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