National Casualty Company v. National Strength and Conditioning Association

Filing 64

ORDER denying without prejudice 57 Defendant's Motion to Seal. Signed by Judge Janis L. Sammartino on 2/28/2020. (jpp)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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NATIONAL CASUALTY COMPANY,

Case No.: 18-CV-1292 JLS (KSC)

Plaintiff,

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ORDER DENYING WITHOUT
PREJUDICE DEFENDANT’S
MOTION TO SEAL

v.
NATIONAL STRENGTH AND
CONDITIONING ASSOCIATION,

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(ECF No. 57)

Defendant,
NATIONAL STRENGTH AND
CONDITIONING ASSOCIATION,
Counter-Claimant,
v.
NATIONAL CASUALTY COMPANY,

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Counter-Defendant.

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Presently before the Court is Defendant and Counter-Claimant National Strength

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and Conditioning Association’s (“NSCA”) Motion for Order to Seal Exhibits Filed in

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Support of Motion for Partial Summary Judgment (“Mot.,” ECF No. 57). Having carefully

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considered the Motion, the proposed documents, and the relevant law, the Court DENIES

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WITHOUT PREJUDICE the NSCA’s Motion.

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18-CV-1292 JLS (KSC)

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LEGAL STANDARD

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“[T]he courts of this country recognize a general right to inspect and copy public

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records and documents, including judicial records and documents.” Nixon v. Warner

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Commc’ns, Inc., 435 U.S. 589, 597 (1978). “Unless a particular court record is one

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‘traditionally kept secret,’ a ‘strong presumption in favor of access’ is the starting point.”

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Kamakana v. City & Cnty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (citing Foltz

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v. State Farm Mut. Auto Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). “The presumption

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of access is ‘based on the need for federal courts, although independent—indeed,

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particularly because they are independent—to have a measure of accountability and for the

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public to have confidence in the administration of justice.’” Ctr. for Auto Safety v. Chrysler

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Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016) (quoting United States v. Amodeo, 71 F.3d

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1044, 1048 (2d Cir. 1995)).

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A party seeking to seal a judicial record bears the burden of overcoming the strong

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presumption of access. Foltz, 331 F.3d at 1135. The showing required to meet this burden

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depends upon whether the documents to be sealed relate to a motion that is “more than

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tangentially related to the merits of the case.” Ctr. for Auto Safety, 809 F.3d at 1102. When

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the underlying motion is more than tangentially related to the merits, the “compelling

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reasons” standard applies. Id. at 1096–98. When the underlying motion does not surpass

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the tangential relevance threshold, the “good cause” standard applies. Id.

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“In general, ‘compelling reasons’ sufficient to outweigh the public’s interest in

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disclosure and justify sealing court records exists when such ‘court files might have

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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.” Kamakana,

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447 F.3d at 1179 (quoting Nixon, 435 U.S. at 598). However, “[t]he mere fact that the

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

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to further litigation will not, without more, compel the court to seal its records.” Id. (citing

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Foltz, 331 F.3d at 1136). The decision to seal documents is “one best left to the sound

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18-CV-1292 JLS (KSC)

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discretion of the trial court” upon consideration of “the relevant facts and circumstances of

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the particular case.” Nixon, 435 U.S. at 599.

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ANALYSIS

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The NSCA seeks leave to file the following documents under seal:

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1.

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Portions of the NSCA’s Memorandum of Points and Authorities in Support

of Its Motion for Partial Summary Judgment (“MPSJ”) (the “Memorandum”);
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Exhibit G to the NSCA’s Compendium of Evidence in Support of Its MPSJ

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(the “Compendium”), which is a June 21, 2016 letter from John R. Hapner, Claims

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Litigation Analyst, K&K Insurance, to Thomas M. James, Law Office of Thomas M.

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James, P.C.;
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Exhibit H to the Compendium, which is a July 25, 2016 letter from Mr. James

to Mr. Hapner; and
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Exhibit I to the Compendium, which is a July 12, 2017 letter from Lisa

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Lampkin of Selman Breitman LLP, counsel for Plaintiff and Counter-Defendant National

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Casualty Company (“NCC”), to Daniel H. Rylaarsdam (then of Kilpatric Townsend &

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Stockton LLP), counsel for the NSCA.

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See ECF No. 57-1 at 1. The NSCA contends that “there are ‘compelling reasons’ to seal”

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these documents because “Exhibits G, H, and I are designated as ‘Confidential’ [by the

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NSCA] pursuant to the signed Protective Order in place because they contain confidential

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and privileged insurance information not available to the public” and the “Memorandum

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includes quotes from Exhibits G, H, and I.” See id. at 1–2. The NSCA also argues that

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these documents “should be treated as confidential communications between NSCA and

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its insurer, National Casualty,” and that “National Casualty has taken the position that

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documents containing information similar to the information contained in Exhibits G, H,

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and I contain proprietary information of National Casualty.” Id. at 2 (emphasis in original).

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Given the strong presumption in favor of access to court records, a party seeking to

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file under seal materials in support of a dispositive motion, such as a motion for summary

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judgment, must articulate compelling reasons to maintain their confidentiality. See Foltz,
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18-CV-1292 JLS (KSC)

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331 F.3d at 1136. Under the compelling reasons standard, “the party seeking protection

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bears the burden of showing specific prejudice or harm will result if no [protection] is

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granted.” Phillips v. Gen. Motors Corp., 307 F.3d 1206, 1210–11 (9th Cir. 2002). That

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the documents sought to be filed under seal are subject to a protective order, without more,

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does not satisfy the compelling reasons standard. Foltz, 331 F.3d at 1136. Further, “[t]he

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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

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seal its records.” Kamakana, 447 F.3d at 1179 (citing Foltz, 331 F.3d at 1136).

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The NSCA has failed to meet its burden here. The NSCA’s argument for sealing

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Exhibits G, H, and I and those portions of the Memorandum quoting those documents

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hinges on its own designation of the documents as “Confidential” pursuant to the Protective

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Order in this case, the purported “privileged and confidential” nature of the

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communications, and NCC’s prior arguments—rejected by this Court, see ECF No. 54—

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that similar documents “contain proprietary information.” See ECF No. 57-1 at 1–2.

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Review of Exhibits G, H, and I, however, reveals that they primarily consist of matters of

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public record, including California statutes and federal court records, including the

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insurance policies issued by NCC to the NSCA. See generally ECF Nos. 58-1–3; see also

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ECF Nos. 1-7–8. It is also clear from the pleadings in this case that NCC agreed to defend

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the NSCA in CrossFit, Inc. v. National Strength and Conditioning Association, No. 14-

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CV-1191 JLS (KSC) (S.D. Cal. filed May 12, 2014), subject to a reservation of rights. See,

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e.g., ECF No. 1 ¶ 13; ECF No. 7 ¶ 16. It is therefore unclear to the Court what portions of

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Exhibits G, H, and I—if any—contain “confidential” or “proprietary information” or what

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specific prejudice or harm NCC or the NSCA may suffer if those exhibits are not filed

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under seal. Because the NSCA has failed to meet its burden of establishing “compelling

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reasons” sufficient to outweigh the public’s interest in Exhibit G, H, and I in support of its

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pending MPSJ, the Court DENIES WITHOUT PREJUDICE the NSCA’s Motion.

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18-CV-1292 JLS (KSC)

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CONCLUSION

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In light of the foregoing, the Court DENIES WITHOUT PREJUDICE the

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NSCA’s Motion (ECF No. 57). Within seven (7) days of the electronic docketing of this

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Order, the NSCA or NCC SHALL FILE a renewed motion to seal that meets the

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“compelling reasons” standard OR the NSCA SHALL FILE full, unredacted copies of

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the documents previously lodged under seal at ECF No. 58.

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IT IS SO ORDERED.

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Dated: February 28, 2020

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18-CV-1292 JLS (KSC)