Nautilus Biotechnology, Inc. v. Somalogic, Inc.

Filing 56

ORDER GRANTING 32 33 ADMINISTRATIVE MOTIONS TO SEAL REGARDING FIRST AMENDED COMPLAINT. Signed by Judge Beth Labson Freeman on 11/26/2024. (blflc3, COURT STAFF) (Filed on 11/26/2024) (Entered: 11/26/2024)

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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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NAUTILUS BIOTECHNOLOGY, INC.,

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Plaintiff,
v.

United States District Court
Northern District of California

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SOMALOGIC, INC., et al.,

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Defendants.

Case No. 23-cv-06440-BLF
ORDER GRANTING
ADMINISTRATIVE MOTIONS TO
SEAL REGARDING FIRST AMENDED
COMPLAINT
[Re: ECF No. 32, 33]

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Before the Court are (1) Plaintiff Nautilus Biotechnology, Inc.’s (“Plaintiff”) Administrative

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Motion to File Under Seal Portions of Plaintiff’s First Amended Complaint, ECF 32; and (2)

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Plaintiff’s Administrative Motion to Consider Whether Another Party’s Material Should Be Sealed,

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ECF 33. Defendants SomaLogic, Inc., and California Institute of Technology (collectively,

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“Defendants”) did not oppose to either motion. Additionally, Defendants filed a declaration in

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support of Plaintiff’s Motion to Consider Whether Another Party’s Material Should be Sealed. ECF
36. Having reviewed the Parties’ submissions and applicable sealing law, the Court GRANTS
Plaintiff’s requests to seal.
I.

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

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

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Accordingly, when considering a sealing request, “a ‘strong presumption in favor of access’ is the

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starting point.” Id. (quoting Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir.

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2003)). Parties seeking to seal judicial records relating to motions that are “more than tangentially related
to the underlying cause of action,” Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1099 (9th

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Cir. 2016), bear the burden of overcoming the presumption with “compelling reasons supported by

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specific factual findings that outweigh the general history of access and the public policies favoring

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disclosure.” Kamakana, 447 F.3d at 1178–79 (internal quotation marks and citation omitted).

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Compelling reasons justifying the sealing of court records generally exist “when such ‘court files

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might . . . become a vehicle for improper purposes,’” Kamakana, 447 F.3d at 1179 (quoting Nixon, 435

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U.S. at 598), such as: “to gratify private spite, promote public scandal, circulate libelous statements,”
id.; to “release trade secrets,” id.; or “as sources of business information that might harm a litigant's

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United States District Court
Northern District of California

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competitive standing,” Ctr. for Auto Safety, 809 F.3d at 1097 (quoting Nixon, 435 U.S. at 598–99). On
the other hand, “[t]he mere fact that the production of records may lead to a litigant’s embarrassment,

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incrimination, or exposure to further litigation will not, without more, compel the court to seal its

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records.” Kamakana, 447 F.3d at 1179. “Broad allegations of harm, unsubstantiated by specific

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examples or articulated reasoning” will not suffice. Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470,

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476 (9th Cir. 1992) (citation omitted). And although a protective order sealing the documents during

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discovery may reflect a court’s previous determination that good cause—a lower threshold than that

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required for finding a compelling reason to seal—exists to keep the documents sealed, see Kamakana,
447 F.3d at 1179–80, a blanket protective order that allows the parties to designate confidential

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documents does not provide sufficient judicial scrutiny to determine whether each particular document

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should remain sealed. See Civ. L.R. 79-5(d)(1)(A) (“Reference to a stipulation or protective order that
allows a party to designate certain documents as confidential is not sufficient to establish that a
document, or portions thereof, are sealable.”).

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In addition, the Local Rules of this Court require that all requests to seal be “narrowly tailored

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to seek sealing only of sealable material.” Civ. L.R. 79-5(a). That is, the sealing motion must include “a

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specific statement of the applicable legal standard and the reasons for keeping a document under seal,

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including an explanation of: (i) the legitimate private or public interests that warrant sealing; (ii) the
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United States District Court
Northern District of California

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injury that will result if sealing is denied; and (iii) why a less restrictive alternative to sealing is not
sufficient.” Id. at 79-5(c)(1).

II.

DISCUSSION

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The material under consideration for sealing concerns information that Plaintiff has deemed

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confidential, i.e., information related to (1) Plaintiff’s technical features, components, and design of

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its unreleased platform, ECF 32 at 2, and (2) sensitive business and financial terms contained in

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Defendants’ licenses and agreements with a non-party competitor, ECF 36 at 1. With regard to the

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former, Plaintiff requests the Court seal approximately 7 lines of text and a figure in Plaintiff’s First

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Amended Complaint on the basis that the portion contains “technical details includ[ing]

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configuration of the key components of [Plaintiff’s] unreleased platform.” Decl. of Derek C. Walter,

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ECF 32-1 at ¶ 3. Plaintiff states that the information is “highly confidential” and would cause

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Plaintiff “competitive harm” if disclosed publicly. Id. With regard to the later, in support of

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Plaintiff’s request to seal approximately 25 lines of text in Plaintiff’s First Amended Complaint

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related to Defendants’ licensing agreements with the non-party competitor, Defendants state that

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those information contains confidential business and financial terms and would put Defendants and

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the non-party competitor in a “disadvantaged” position for future licensing discussions. Decl. of

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Sandra L. Haberny, ECF 36 at ¶ 4.

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The Court finds that Plaintiff has established compelling reasons to seal information that would

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reveal its unreleased platform information and Defendants’ confidential business and financial terms in

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their licensing agreements. See, e.g., In re Elec. Arts, 298 F. App’x. 568, 569 (9th Cir. 2008) (finding

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compelling reasons for sealing “business information that might harm a litigant’s competitive strategy”);

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Music Grp. Macao Com. Offshore Ltd. v. Foote, 2015 WL 3993147, at *6 (N.D. Cal. June 30, 2015)

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(“[T]he Court finds a compelling reason to seal the portions of this exhibit that discuss Plaintiff's network

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infrastructure and security systems.”); In re Google Location Hist. Litig., No. 5:18-cv-05062-EJD, 514

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F. Supp. 3d 1147, 1162 (N.D. Cal. Jan. 25, 2021) (“Compelling reasons may exist to seal ‘trade secrets,

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marketing strategies, product development plans, detailed product-specific financial information,

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customer information, internal reports[.]’”) (citation omitted). The public interest in this information is

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limited where the content sought to be sealed is irrelevant to the issues raised in the related MSJ. See

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Kamakana, 447 F.3d at 1179 (finding that the reason for the higher standard for sealing documents

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related to dispositive motions is because “resolution of a dispute on the merits . . . is at the heart of” the

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public interest so the public has less of a need to access documents that are “unrelated or only tangentially

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related” to the merits of the motion). Additionally, the Court finds Plaintiff’s sealing requests to be

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narrowly tailored so that there is no less restrictive alternative to redacting the information at issue.

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Accordingly, the Court GRANTS Plaintiff’s sealing requests as set forth in the table below:

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Public ECF No./

Document to be

Result

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(Sealed ECF No.)

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34/(32-3)

Sealed
Plaintiff’s First
Amended Complaint
(highlighted portions
on pg. 14, lines 6-18).

GRANTED

United States District Court
Northern District of California

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34/(32-3)

Plaintiff’s First
Amended Complaint
(highlighted portions
at pg. 2, lines
8-9; pg. 3, lines 9-16,
18-19, 21-26;
pg. 6, lines 1-3; pg.
12, lines 17-19;
and pg. 13, line 10).

GRANTED

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Reasoning
The highlighted
portions of
the document that
Plaintiff seeks to seal
reflect specific
technical details of
Plaintiff’s
unreleased platform.
See ECF 32-1 at ¶ 3.
The highlighted
portions of
the document that
Plaintiff seeks to seal
contain confidential
business information
regarding Defendants’
license agreements.
See ECF 36, Haberny
Decl., at ¶ 4.

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IT IS SO ORDERED.

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Dated: November 26, 2024
______________________________________
BETH LABSON FREEMAN
United States District Judge

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