In Re: Panama
Filing
391
ORDER granting, in part 377 Buzzfeed's Motion to Intervene and Unseal Judicial Documents. The Clerk of Courts is directed to unseal docket entry numbers 36, 90, 110, 138 and 306. Signed by Magistrate Judge Lauren Fleischer Louis on 10/4/2020. See attached document for full details. (age)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO.: 14-CV-24887-LOUIS
IN RE APPLICATION OF
HORNBEAM CORPORATION,
Request for Discovery Pursuant to
28 U.S.C. § 1782
_________________________________/
ORDER
THIS CAUSE is before the Court on Buzzfeed Inc.’s (“Buzzfeed”) Motion to Intervene
and Unseal Judicial Documents (ECF No. 377). This case was referred to the undersigned United
States Magistrate Judge by the Honorable Patricia A. Seitz, United States District Judge, for all
proceedings, including judgment and the entry of orders, upon the Parties’ notice and consent (ECF
Nos. 226; 234). Having reviewed the Motion, the pleadings and being otherwise duly advised on
the matter, the Court hereby orders that the Motion be GRANTED, in part.
I.
BACKGROUND
The underlying dispute from which this discovery proceeding is base arose from the
purchase of a steel mill in Ohio by three Ukrainian businessmen and its ownership by their holding
company, Warren Steel Holdings, LLC, and subsequently Halliwel Assets Inc. (“Halliwel”). Over
time, the relationship deteriorated and one of the businessmen, Vadim Shulman, alleged that the
other two businessmen, Igor Kolomoisky and Gennadiy Bogolyubov, had engaged in self-dealing
and had essentially shut Shulman out from the operations of their business. Shulman’s allegations
implicate several companies, individuals, and other entities in Kolomoisky and Bogolyubov’s selfdealing scheme. As it pertains to this action, Shulman, through the entity Hornbeam Corporation
(“Hornbeam”), brought a 28 U.S.C. § 1782 action before this Court on December 29, 2014,
1
requesting discovery for use in future foreign proceedings in the British Virgin Islands (“BVI”)
against Kolomoisky, Bogolyubov, and their related entities Halliwel, Marigold, and Panikos
Symeou (“Symeou”).
On February 11, 2015, United States Magistrate Judge William C. Turnoff granted
Hornbeam’s 28 U.S.C. § 1782 application for discovery (ECF No. 12), and authorized Hornbeam
to serve subpoenas on 15 persons and entities for testimony and documents. Though the case was
initially closed shortly thereafter, the litigation did not end there. What followed was more than
three years of filings by both Parties that included motions to stay, motions to vacate, motions for
reconsideration, objections, and appeals.
Relevant to the instant Motion, the Court entered a Stipulated Protective Order (“SPO”)
(ECF No. 224) that was later amended (ECF No. 318). The SPO laid out the process by which
documents designated as confidential or attorneys’ eyes only would be filed under seal; and by
which the discovery materials would be disposed of, should the BVI litigation never come to
fruition or otherwise end (id.). Pursuant to this SPO, ten docket entries were filed under seal (ECF
Nos. 36; 78; 90; 110; 135; 138; 287-1; 306; 307; 322).
Ultimately, Hornbeam conceded that foreign proceedings in the BVI would not be
instituted, and the Eleventh Circuit vacated the § 1782 order being appealed (ECF No. 209) and
remanded for the district court to decide in the first instance whether the discovery already obtained
should be destroyed as appellants requested. In re Hornbeam Corp., 790 F. App’x 199, 201 (11th
Cir. 2020). The undersigned ultimately ordered that all responsive documents be destroyed by the
Parties no later than May 18, 2020, and closed the case on May 11, 2020 (ECF No. 375).
On August 3, 2020, roughly three months after the case was closed, Buzzfeed filed its
instant Motion seeking to intervene in the action and have the ten docket entries previously filed
2
under seal pursuant to the SPO made public (ECF No. 377). Buzzfeed argues that this 28 U.S.C.
§ 1782 proceeding is of significant public concern and that the sealed documents are subject to the
First Amendment and common-law right of access to judicial records (id.). The Motion noted that
upon conferral, the unsealing of docket entry numbers 78 and 135 were unopposed, and thus the
Court entered an order unsealing those documents (ECF No. 380).
Subsequently, Hornbeam and Intervenors Vadim Shulman (“Shulman”) and Bracha
Foundation (“Bracha”) (collectively, “Applicants”) filed a response to Buzzfeed’s Motion. The
Applicants do not oppose Buzzfeed’s intervention, but jointly oppose the unsealing of docket
entries 287-1 and 322 (ECF No. 384). As for docket entry numbers 306 and 307, Applicants state
that they do not consent to or advocate the continued sealing of the docket entries (id.). Applicants
further state that they take no position regarding the continued sealing of the docket entries 36, 90,
110, and 138, but presume the grounds for their having been originally sealed remain persuasive
(id.).
Intervenors Halliwel, Symeou and Subpoena Respondents1 (collectively, “Respondents”)
also filed a response in opposition to Buzzfeed’s Motion (ECF No. 385). Respondents do not
challenge Buzzfeed’s right to intervene, nor do they challenge the unsealing of the documents with
the exception of docket entry 307, a notice of sealed filing with portions of a deposition transcript
designated as attorneys’ eyes only attached (the “AEO Transcript”) (id.). Respondents argue that
Buzzfeed has no qualified First Amendment or common-law right of access to the AEO Transcript
as it is a discovery document related solely to a discovery dispute, unrelated to the merits of the
case (id.). Respondents further argue that the Court has already found good cause to uphold the
The “Subpoena Respondents” are: CC Metals and Alloys, LLC; Felman Production, LLC; Felman
Trading, Inc.; Georgian American Alloys, Inc.; Mordechai Korf; Optima Acquisitions, LLC; Optima
Group, LLC; Optima Fixed Income, LLC; Optima Ventures, LLC; Optima International of Miami, Inc.;
and 5251 36ST, LLC.
1
3
AEO Transcript’s designation (ECF Nos. 304; 343) and thus the AEO Transcript should not just
remain sealed but be stricken from the record and destroyed (ECF No. 385). Buzzfeed filed a reply
(ECF No. 389) and the matter is ripe for review.
II.
DISCUSSION
“The common-law right of access to judicial proceedings, an essential component of our
system of justice, is instrumental in securing the integrity of the process.” Chicago Tribune Co. v.
Bridgestone/Firestone, Inc., 263 F.3d 1304, 1311 (11th Cir. 2001). The common-law right of
access includes the right to inspect and copy public records and documents. Nixon v. Warner
Comm., Inc., 435 U.S. 589, 597, 98 S.Ct. 1306, 1312, 55 L.Ed.2d 570 (1978). However, “the right
to inspect and copy judicial records is not absolute.” Id. Rather, the common-law right of access
may be overcome by a showing of good cause, a standard that requires a court to balance the
public’s right of access against the party’s interest in keeping information confidential. Jankula v.
Carnival Corp., No. 18-CV-24670, 2019 WL 8051714, at *1 (S.D. Fla. July 30, 2019) (citing
Romero v. Drummond Co., Inc., 480 F.3d 1234, 1246 (11th Cir. 2007)). A judge’s exercise of
discretion in deciding whether to release judicial records should be informed by a “sensitive
appreciation of the circumstances that led to ... [the] production [of the particular document in
question].” Nixon, 435 U.S. at 598, 602–03, 98 S. Ct. at 1312, 1314–15. “Not unlike the Rule 26
standard, the common-law right of access requires a balancing of competing interests.” Chicago
Tribune Co., 263 F.3d at 1311.
“Although there is some disagreement about where precisely the line should be drawn,
when applying the common-law right of access federal courts traditionally distinguish between
those items which may properly be considered public or judicial records and those that may not;
the media and public presumptively have access to the former, but not to the latter.” Id. (citations
4
omitted). “An illustrative example is the treatment of discovery material, for which there is no
common-law right of access, as these materials are neither public documents nor judicial records.”
Id. (citation omitted) (holding that the “rule is that material filed with discovery motions is not
subject to the common-law right of access, whereas discovery material filed in connection with
pretrial motions that require judicial resolution of the merits is subject to the common-law right.”);
see also Jankula, 2019 WL 8051714, at *1 (“Material filed in connection with any substantive
pretrial motion, unrelated to discovery, is subject to the public’s common law right of access to
judicial proceedings.”) (citing Romero, 480 F.3d at 1245).
In balancing the public interest in accessing court documents against a party’s interest in
keeping the information confidential, courts consider, among other factors: (1) whether allowing
access would impair court functions or harm legitimate privacy interests; (2) the degree of and
likelihood of injury if made public; (3) the reliability of the information; (4) whether there will be
an opportunity to respond to the information; (5) whether the information concerns public officials
or public concerns; and (6) the availability of a less onerous alternative to sealing the documents.
Romero, 480 F.3d at 1246. Importantly, “the presumption of public access is much stronger with
regard to dispositive documents that relate to the merits of the case.” Id. at 1245-6.
As an initial matter, the Parties do not challenge Buzzfeed’s assertion that it has standing
to intervene in these proceedings to ask that court records be unsealed. The Parties’ failure to
challenge this aspect of the Motion is sufficient cause for the Court to accept that Buzzfeed has
standing to bring the Motion. See Jankula, 2019 WL 8051714, at *1. Furthermore, the Parties do
not contest the unsealing of docket entries 36, 90, 110, 138 and 306. Because there has been no
showing of good cause to overcome the common-law right of access, and because the Court finds
there is nothing within these documents that would injure the Parties if made public, the Court
5
orders that docket entries 36, 90, 110, 138 and 306 be unsealed.
i.
Docket Entry 287-1
Docket entry 287-1 is an ex parte communication that was filed as an attachment to an
order directing the Clerk of the Court to file said communication under seal pursuant to Section
6(f) of the SPO (ECF No. 287). Buzzfeed does not put forth any specific argument as to why this
particular document should be unsealed. Applicants argue that this ex parte email communication
to the Court, which included certifications disclosing persons who had received confidential
information in this case, lacks any substance to the adjudication of the merits in this case (ECF
No. 384 at 2). Rather, the Applicants aver that this ex parte communication was merely provided
to the Court pursuant to the SPO, which states that “[c]ertifications will be produced to and kept
on file by the Court” (ECF No. 224). Applicants aver that because the document has no relation to
the merits of the case, it should not be made public. The Court agrees.
“[M]aterial filed in connection with pretrial motions that require judicial resolution of the
merits is subject to the common-law right.” Romero, 480 F.3d at 1245 (citing Chicago Tribune
Co., 263 F.3d at 1312) (emphasis added). The filing of this ex parte communication had no bearing
on the merits of the case. It was merely filed to adhere to the SPO, which governed the Parties’
discovery. As such, the Court finds that docket entry 287-1 should remain sealed.
ii.
Docket Entry 322
As for docket entry 322, Applicants aver that the reasons for sealing it are known to the
Court and remain manifest from the face of the document itself, and thus the document should
remain sealed (ECF No. 384 at 2). While not the most persuasive argument standing alone, upon
a review of the sealed document, the undersigned agrees. Docket entry 322 includes a February
2019 court order from the Northern District of Ohio, which specifically states that the order is to
6
remain sealed until further order of the court. It does not appear that the Norther District of Ohio
ever ordered that its February 2019 order be unsealed, and thus this Court finds that it is not proper
to unseal the document against the Northern District of Ohio’s order.
iii.
Docket Entry 307
The entirety of Respondents’ response focuses on docket entry 307, the AEO Transcript,
and why it should be permanently sealed or destroyed (ECF No. 385). Buzzfeed contends that by
prior order of the Court, the document was to remain under seal only until November 30, 2019,
one year after it was ordered sealed (ECF No. 304).
The AEO Transcript was not filed as part of a substantive pretrial motion that required
judicial resolution of the merits. Rather, it was filed only in relation to a dispute over the
confidentiality designation of the transcript. Upon review of the contested document and the
docket as a whole, I find it is not relevant to any dispositive issue in the litigation.
In fact, the document bears no relevance to the case at all, which is why the document was
designated as for attorneys’ eyes only in the first place. During the deposition from which the AEO
Transcript was derived, the deponent was asked questions beyond the scope of discovery
authorized (see ECF Nos. 267, 343). This included personal and financial questions bearing no
relevance to the case. Rather than halting the deposition to seek an additional protective order,
Respondents continued in good faith under the existing SPO, and allowed the deposition to
continue uninterrupted, electing instead to designate the testimony as attorneys’ eyes only. As this
Court has already recognized, failure to protect a party’s reliance on a protective order would not
only prejudice the confidentiality interests of the party, “it would undermine the effectiveness of
protective orders in facilitating discovery.” In re Hornbeam Corp., No. 14-CV-24887, 2020 WL
1302217, at *3 (S.D. Fla. Mar. 17, 2020) (citing State ex rel. Butterworth v. Jones Chemicals, Inc.
7
(Fla.), 148 F.R.D. 282, 288 (M.D. Fla. 1993)).
Good cause also exists for excluding the AEO Transcript from the common-law right of
access. When the attorneys’ eyes only designation of the AEO Transcript was challenged by
Hornbeam after the deposition, this Court held that Respondents had met their burden under
Federal Rules of Civil Procedure Rule 26(c) (ECF No. 343). The Court found that the AEO
Transcript was properly designated as for attorneys’ eyes only because the materials were
sensitive, personal and beyond the scope of discovery in this case (id.). These findings still hold
true, and the document’s unsealing would harm legitimate privacy interests of the deponent.
Buzzfeed’s central argument for unsealing is predicated on the expiration of the order
sealing the document for one year (ECF No. 304). Its reliance on the one-year period is misplaced
here, as the Court imposed a specific time frame for procedural reasons only, pursuant to Local
Rule 5.4(e)(1), which states that “[a]n order granting a motion to seal shall state the period of time
that the sealed filing shall be sealed.” Notwithstanding the expiration of the sealing order, the
document has not been unsealed. In light of the continuing objection to its unsealing of docket
entry 307 due to the sensitive nature and content of the AEO Transcript, and its irrelevance to the
case at hand, docket entry 307 will remain under seal and the Motion is denied with respect to this
docket entry.
III.
CONCLUSION
For the reasons stated above, it is hereby ORDERED AND ADJUDGED that Buzzfeed’s
Motion to Intervene and Unseal Judicial Documents (ECF No. 377) be GRANTED, in part. The
Court finds that Buzzfeed has a right to intervene in the litigation for the limited purpose of seeking
access to sealed judicial documents. The clerk of the Court is ORDERED to unseal docket entries
36, 90, 110, 138 and 306.
8
The Motion is DENIED with respect to Buzzfeed’s request to unseal docket entries 2871, 322 and 307; these docket entries shall remain under seal.
DONE AND ORDERED in Chambers at Miami, Florida on this 4th day of October, 2020.
LAUREN LOUIS
UNITED STATES MAGISTRATE JUDGE
9
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?