Lin et al v. Suavei, Inc. et al

Filing 127

ORDER Granting in Part and Denying in Part Motion to Seal (ECF No. 120 -1) For the foregoing reasons, the Court GRANTS the request to seal Exhibit A in its entirety, Exhibit E pages 497-506 and Exhibit F in its entirety, and DENIES the request in all other respects. Signed by Judge M. James Lorenz on 11/13/2023. (cxl1)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JADE LIN, et al, Case No.: 3:20-cv-0862-L-AHG Plaintiffs, 12 13 v. 14 SUAVEI, INC., et al, ORDER GRANTING IN PART AND DENYING IN PART MOTION TO SEAL [ECF NO. 120-1.] Defendants. 15 16 17 Pending before the Court is Counterclaimant Frank DeJoy’s (“DeJoy”) motion to 18 19 seal. (Mot. Seal at 2 [ECF No. 120-1 (“Mot.”).) Neither Plaintiffs nor Defendant Suavei 20 filed an opposition. For the reasons stated below, the motion is granted in part and 21 denied in part. Sealing court records implicates the "general right to inspect and copy public 22 23 records and documents, including judicial records and documents." Nixon v. Warner 24 Commc'ns, Inc., 435 U.S. 589, 597 & n.7 (1978). 1 The lack of opposition to a motion to 25 seal therefore does not automatically resolve it. See Foltz v. State Farm Mut. Auto Ins. 26 27 28 Unless otherwise noted, internal quotation marks, citations, brackets, ellipses and footnotes are omitted throughout. 1 1 3:20-cv-0862-L-AHG 1 2 Co., 331 F.3d 1128, 1130 & passim (9th Cir. 2003). Aside from “grand jury transcripts and warrant materials in the midst of a pre- 3 indictment investigation,” a strong presumption applies in favor of public access to 4 judicial records. Kamakana v. City and County of Honolulu, 447 F.3d 1172, 1178 (9th 5 Cir. 2006). A party seeking to seal a judicial record bears the burden of overcoming the 6 strong presumption of public access by meeting the “compelling reasons” standard. Id. at 7 1178. Compelling reasons for sealing information exist “when such ‘court files might 8 have become a vehicle for improper purposes,’ such as the use of records to gratify 9 private spite, promote public scandal, circulate libelous statements, or release trade 10 secrets.” Kamakana, 447 F.3d at 1179 (quoting Nixon, 435 U.S. at 598). The compelling 11 reasons standard applies to documents filed in relation to any motion except a motion that 12 is only “tangentially related to the merits of a case.” Ctr. for Auto Safety v. Chrysler Grp. 13 LLC, 809 F.3d 1092, 1101 (9th Cir. 2016). "Under this exception, a party need only 14 satisfy the less exacting 'good cause' standard" under Federal Rule of Civil Procedure 15 26(c). Id. at 1097. “Broad allegations of harm, unsubstantiated by specific examples or 16 articulated reasoning, do not satisfy the Rule 26(c) test.” Beckman Indus., Inc. v. Int’l 17 Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992). 18 The documents DeJoy requests to seal were filed in support of DeJoy’s motion for 19 default judgment. (See Motion. [ECF No. 120-1.]) Here, the motion is related to the 20 merits, accordingly the Court applies the “compelling reason” standard. See Kamakana, 21 447 F.3d at 1179. 22 23 DeJoy seeks to have the following filed under seal: 1. Exhibit A, in its entirety. Exhibit A is prepared by DeJoy’s accountants 24 regarding his damages and includes financial documents supporting DeJoy’s 25 economic loss claims. Exhibit A includes bank statements, financial 26 documents, documents showing loss of job opportunity because of pending 27 third-party complaint, all of which protected from disclosure by right to 28 privacy of financial documents, legal invoices protected from disclosure by 2 3:20-cv-0862-L-AHG 1 2 attorney-client privilege)[sic]; 2. Exhibit B, two exhibits marked at the deposition of Afonso Infante on 3 January 25, 2022, B:231-232 (Suavei’s financial statements) and 233-251 4 (Suavei’s confidential trade secret, commercially sensitive materials); 5 3. Exhibit C, in its entirety. Exhibit C is the transcript of deposition testimony 6 of Afonso Infante on January 26, 2022 which was marked “Confidential” 7 pursuant to the protective order [ECF No. 51] and confidential exhibits 8 introduced during the deposition on January 26, 2022; 9 4. Exhibit D, pages 402, 404-440, 472-474, 476, 478, 480, 482, 484-485, 487- 10 490, 492-496 which are financial documents of Suavei and marked 11 confidential by Suavei’s counsel; 12 5. Exhibit E, in its entirety, pages 497-506, which are legal invoices from the 13 law firm of Rutan Tucker and protected from disclosure by attorney-client 14 privilege and work product doctrine; and 15 6. Exhibit F, in its entirety, which are legal invoices from the law firm of 16 Ropers Majeski for professional services rendered from July 1, 2023 to 17 present, and protected from disclosure by attorney-client privilege and work 18 product doctrine. 19 20 (Id. at 4-5). DeJoy argues that the financial documents in Exhibit A warrant sealing because 21 they are entitled to the right to privacy as personal financial documents. (Mot. to Seal at 22 4-5 [ECF No. 120-1.]) District courts within the Ninth Circuit have found that a party's 23 legitimate interest in ensuring the privacy of personal information outweighs the public's 24 interest in access to court filings. See Activision Publ'g, Inc. v. EngineOwning UG, No. 25 CV 2:22-cv-00051-MWF (JCx), 2023 WL 2347134, at *1 (C.D. Cal. Feb. 27, 2023) 26 (“[C]ompelling reasons exist to keep personal information confidential to protect an 27 individual's privacy interest and to prevent exposure to harm or identity theft.”); Nursing 28 Home Pension Fund v. Oracle Corp., No. C01-00988 MJJ, 2007 WL 3232267, at *2 3 3:20-cv-0862-L-AHG 1 (N.D. Cal. Nov. 1, 2007) (finding compelling reasons to seal home addresses and 2 financial account information). Such information is therefore sealable under the 3 “compelling reason” standard. See Ctr. for Auto Safety, 809 F.3d at 1097. Therefore, 4 Court GRANTS DeJoy’s motion to seal Exhibit A in its entirety. 5 DeJoy requests that the Court seal portions of Exhibits B and D because they 6 purportedly contain Suavei’s financial documents and “confidential trade secret, 7 commercially sensitive materials.” (Mot. Seal at 4-5). Although trade secrets, 8 commercially sensitive materials, and materials marked confidential may be sealed where 9 “compelling reasons” are found, a particularized factual showing is required. Foltz v. 10 State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1137 (9th Cir. 2003). DeJoy has not 11 sufficiently supported his request to seal these documents with particularity, therefore, 12 the Court DENIES his request. 13 DeJoy argues that Infante’s deposition testimony in Exhibit C should be sealed in 14 its entirety because the deposition is subject to a protective order. (Mot. to Seal at 4.) 15 That a document is designated confidential pursuant to a protective order is of little 16 weight when it comes to sealing court filings. See San Jose Mercury News, Inc. v. U.S. 17 Dist. Ct.(Saldivar), 187 F.3d 1096, 1103 (9th Cir. 1999); Beckman Indus. v. Int'l Ins. Co., 18 966 F.2d 470, 475-76 (9th Cir. 1992); Confederated Tribes of Siletz Indians of Or. v. 19 Weyerhaeuser Co., 340 F. Supp. 2d 1118, 1121 (D. Or. 2003). By nature, protective 20 orders are over inclusive, see Beckman, 966 F.2d at 476, because prior to signing, the 21 judge typically does not have the opportunity to analyze whether any particular document 22 should be sealed. See San Jose Mercury News, 187 F.3d at 1103; Foltz, 331 F.3d at 23 1133. “Several legal sources bear upon the decision to seal or unseal a document, 24 including Fed.R.Civ.P. 26, the common law right, and the First Amendment. San Jose 25 Mercury News, 187 F.3d at 1101–02; Chicago Tribune Co. v. Bridgestone/Firestone, 26 Inc., 263 F.3d 1304, 1309–10 (11th Cir.2001)). 27 28 The Court has reviewed Infante’s deposition in Exhibit C and finds that DeJoy’s reliance on the protective order is insufficient to warrant sealing of Exhibit C. DeJoy has 4 3:20-cv-0862-L-AHG 1 not identified with particularity any material contained within the transcript that should 2 be sealed. Instead, the broad “allegations of harm, unsubstantiated by specific examples 3 or articulated reasoning, do not satisfy the Rule 26(c) test.” Beckman Indus., Inc., 966 4 F.2d at 476. The Court therefore DENIES DeJoy’s request to seal the entirety of Exhibit 5 C. 6 Finally, DeJoy requests that the invoices supporting his request for attorneys’ fees 7 and costs from law firm Rutan Tucker, Exhibit E pages 497-506, and Ropers Majerski, 8 Exhibit F in its entirety, be sealed under the attorney-client privilege and work-product 9 doctrines. (Mot. at 5). District courts in the Ninth Circuit have found attorney–client 10 privilege and the work-product doctrine sufficiently justify sealing, even under the higher 11 “compelling reason” standard. See In re Hewlett-Packard Co. S'holder Derivative Litig., 12 No. 15-16688, 2017 WL 5712130, at *4 (9th Cir. Nov. 28, 2017) (affirming sealing 13 decision where “[t]he special master found that HP provided compelling reasons to 14 justify its sealing motion, including that the documents at issue included ... material 15 protected by the attorney–client privilege and the work product doctrine.”) Accordingly, 16 the Court GRANTS DeJoy’s request to seal Exhibit E pages 497-506 and Exhibit F in its 17 entirety. 18 For the foregoing reasons, the Court GRANTS the request to seal Exhibit A in its 19 entirety, Exhibit E pages 497-506 and Exhibit F in its entirety, and DENIES the request 20 in all other respects. 21 22 IT IS SO ORDERED. Dated: November 13, 2023 23 24 25 26 27 28 5 3:20-cv-0862-L-AHG

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