JBS Packerland, Inc. v. Phillips Cattle Co., Inc.

Filing 14

ORDER Denying Without Prejudice Motion to Seal Complaint (ECF No. 3 ). Any Amended Motion to Seal must be filed no later than October 4, 2024. Signed by Judge Cynthia Bashant on 09/23/2024. (mjw)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF CALIFORNIA

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JBS PACKERLAND, INC.,

Case No. 24-cv-01299-BAS-MSB
Plaintiff,

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ORDER DENYING WITHOUT
PREJUDICE MOTION TO SEAL
COMPLAINT
(ECF No. 3)

v.

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PHILLIPS CATTLE CO., INC.,

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Defendant.

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Presently before the Court is Plaintiff JBS Packerland, Inc.’s Motion to Seal the

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Complaint. (ECF No. 3.) The Court finds there may be compelling reasons to seal some

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of the Complaint, but Plaintiff’s redactions are not narrowly tailored. Hence, for the

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following reasons, the Court DENIES WITHOUT PREJUDICE the Motion to Seal.

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I.

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 & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (citing Foltz v.
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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. An action’s

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complaint, and its associated exhibits, are more than tangentially related to the merits of

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the case. Id. at 1098. Similarly, a party’s opposition to a motion to dismiss is more than

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tangentially related to the merits of the case. Ctr. for Auto Safety, 809 F.3d at 1098.

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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 exist when such ‘court files might have become

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a vehicle for improper purposes,’ such as the use of records to gratify private spite, promote

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public scandal, circulate libelous statements, or release trade secrets.” Kamakana, 447

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F.3d at 1179 (quoting Nixon, 435 U.S. at 598). As to this last category, courts have been

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willing to seal court filings containing confidential business material, “such as marketing

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strategies, product development plans, licensing agreements, and profit, cost, and margin

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data,” where the parties have been able to point to concrete factual information to justify

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sealing. See, e.g., Cohen v. Trump, No. 13-cv-2519-GPC-WVG, 2016 WL 3036302, at *5

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(S.D. Cal. May 27, 2016). However, “[t]he mere fact that the production of records may

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lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will not,

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without more, compel the court to seal its records.” Kamakana, 447 F.3d at 1179. A
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blanket protective order is not itself sufficient to show “good cause,” let alone compelling

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reasons, for sealing particular documents. See Foltz, 331 F.3d at 1133; San Jose Mercury

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News, Inc. v. U.S. Dist. Ct., N. Dist., 187 F.3d 1096, 1103 (9th Cir. 1999). The decision to

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seal documents is “one best left to the sound discretion of the trial court” upon

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consideration of “the relevant facts and circumstances of the particular case.” Nixon, 435

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U.S. at 599.

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In addition, parties moving to seal documents must comply with the procedures set

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forth in this Court’s standing order for filing documents under seal. See Standing Order of

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the Hon. Cynthia Bashant for Civil Cases ¶ 5. The rule permits sealing of “only those

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documents, or portions thereof, necessary to protect such sensitive information.” Id. Thus,

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although sometimes it may be appropriate to seal a document in its entirety, whenever

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possible, a party must redact the document appropriately. See Kamakana, 447 F.3d at 1183

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(noting a preference for redactions so long as they “have the virtue of being limited and

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clear”); Murphy v. Kavo Am. Corp., No. 11–cv–00410–YGR, 2012 WL 1497489, at *2–3

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(N.D. Cal. Apr. 27, 2012) (denying motion to seal exhibits but directing parties to redact

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confidential information).

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II.

ANALYSIS

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Plaintiff seeks to seal all the Complaint’s factual allegations but publicly reveal the

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causes of action. (See Compl. ¶¶ 5–18.) Plaintiff argues these allegations cite to contracts

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between the parties that contain commercially sensitive information. (Mot. 3.) Further,

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Plaintiff highlights that the parties agreed in their contracts to keep the terms of them

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confidential. (Id.)

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Plaintiff’s sealing request is overbroad. At the threshold, the compelling reasons

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standard applies to Plaintiff’s Motion because the Complaint is the cornerstone of the case.

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E.g., Pardi v. Tricida, Inc., No. 21-CV-00076-HSG, 2023 WL 6165694, at *2 (N.D. Cal.

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Sept. 21, 2023) (applying the compelling reasons standard to a motion to seal portions of

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the complaint). Further, the Court’s standing order notes: “[t]he fact that both sides agree

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to seal a document or that a stipulated protective order was issued is insufficient cause for
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sealing.” Standing Order § 5.a. Hence, Plaintiff’s analogous reliance on confidentiality

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provisions in the underlying contracts is not enough to justify sealing portions of the

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Complaint.

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In addition, although there may be commercially sensitive information in the

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contracts, Plaintiff’s proposed redactions are overbroad. This breach of contract action

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cannot be litigated in secrecy. The public has the right to know the gist of the underlying

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contracts in order to understand this Court’s rulings. At the same time, the Court

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recognizes that sensitive pricing information and other terms of the contracts may be

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subject to sealing under the compelling reasons standard. See Fed. Trade Comm’n v.

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Qualcomm, Inc., No. 17-cv-00220-LHK, 2019 WL 95922, at *3 (N.D. Cal. Jan. 3, 2019)

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(finding compelling reasons for “information that, if published, may harm [a party’s] or

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third parties’ competitive standing and divulges terms of confidential contracts, contract

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negotiations, or trade secrets”).

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Therefore, the Court will deny without prejudice Plaintiff’s Motion and allow it the

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opportunity to propose more narrowly tailored redactions to the Complaint.

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III.

Plaintiff’s redactions go beyond this information.

CONCLUSION

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For the foregoing reasons, the Court DENIES WITHOUT PREJUDICE Plaintiff’s

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Motion to Seal the Complaint (ECF No. 3). If Plaintiff wishes to renew its sealing request,

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Plaintiff must file an Amended Motion to Seal with a proposed redacted version of the

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Complaint. The redactions must be narrowly tailored to protect sensitive pricing terms or

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other information that may harm Plaintiff’s competitive standing. Further, as required by

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this Court’s standing order, Plaintiff must support its Amended Motion to Seal with a

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declaration from a competent witness. Any Amended Motion to Seal must be filed no later

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than October 4, 2024.

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IT IS SO ORDERED.

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DATED: September 23, 2024
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