Guzman v. The Consumer Law Group, P.A. et al

Filing 210

ORDER that Defendants' 193 Motion to keep tax returns and return information under seal is granted. The Clerk is directed to maintain under seal the tax return information contained in Plaintiff's notice of filing (Doc. no. 181). Signed by Magistrate Judge Brian K. Epps on 06/19/2015. (jah)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF GEORGIA
AUGUSTA DIVISION
JUDY GUZMAN, on behalf of herself
and all others similarly situated,

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Plaintiff,
v.
THE CONSUMER LAW GROUP, P.A.,
et al.,
Defendants.

CV 111-187

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ORDER
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Before the Court is Defendants’ unopposed motion to keep tax returns and return
information under seal.

(Doc. no. 193.)

Defendants request permission to keep the

following documents under seal which have been filed by Plaintiff alongside her motion for
summary judgment: 1) Summary of Defendants’ Annual Income/Revenue as Shown on the
Tax Returns; 2) The Consumer Law Group, P.A.–Tax Returns for S Corporation 2009, 2010,
2011; 3) American Credit Counselors–Returns of Organization Exempt from Income Tax
2007, 2008, 2009, 2010, 2011; 4) American Debt Negotiators, Inc.–Tax Returns for S
Corporation 2007, 2008, 2009, 2010, 2011; 5) Betouch Management Venture–Tax Returns
for S Corporation 2007, 2008, 2009, 2010, 2011; 6) Ran Barnea–Individual Tax Returns
2007, 2008, 2009, 2010, 2011; 7) Daniel Post–Individual Tax Returns 2007, 2008, 2009,

2010, 2011; and 8) Michael Metzner–Individual Tax Returns 2007, 2008, 2009, 2010, 2011.
(Id.)
Under Local Rule 79.7(d), “part[ies] seeking to have any matter placed under seal
must rebut the presumption of the openness derived from the First Amendment by showing
that closure is essential to preserve some higher interest and is narrowly tailored to serve that
interest.”

As the Local Rules reflect, the filing of documents under seal is generally

disfavored, because “[t]he operations of the courts and the judicial conduct of judges are
matters of utmost public concern, and 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.” Romero v. Drummond Co., 480 F.3d 1234, 1245 (11th Cir. 2007)
(internal quotations and citations omitted).

“The common law right of access may be

overcome by a showing of good cause, which requires balancing the asserted right of access
against the other party’s interest in keeping the information confidential.”

Id.

(citing

Chicago Tribune Co. v. Bridgestone/ Firestone, Inc., 263 F.3d 1304, 1309 (11th Cir. 2001)).
When balancing these interests,
courts consider, among other factors, whether allowing access would impair
court functions or harm legitimate privacy interests, the degree of and
likelihood of injury if made public, the reliability of the information, whether
there will be an opportunity to respond to the information, whether the
information concerns public officials or public concerns, and the availability
of a less onerous alternative to sealing the documents.
Id. at 1246. “[A] party’s privacy or proprietary interest in information sometimes overcomes
the interest of the public in accessing the information.” Id. (citations omitted).
However, the parties’ desire to seal court documents “is immaterial to the public right
of access.” Brown v. Advantage Eng’g, Inc., 960 F.2d 1013, 1016 (11th Cir. 1992). In the
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absence of a third party challenging the protection of information, the Court serves as “the
primary representative of the public interest in the judicial process,” and must “review any
request to seal the record (or part of it) [and] may not rubber stamp a stipulation to seal the
record.” Estate of Martin Luther King, Jr., Inc. v. CBS, Inc., 184 F. Supp. 2d 1353, 1363
(N.D. Ga. 2002).
Defendants primarily argue that the tax return information should be sealed because
26 U.S.C. § 6103 designates all such information as confidential. (See doc. no. 193, p. 2.) In
general, there is a public policy concern that leans toward limiting disclosure of tax returns.
See, e.g. Columbus Drywall & Insulation, Inc. v. Masco Corp., 1:04-CV-3066, 2006 WL
5157686, at *7 (N.D. Ga. May 31, 2006); Daniels v. United States, 1:05-CV-0925, 2006 WL
1564260, at *3 (N.D. Ga. Apr. 11, 2006). However, more recent Eleventh Circuit case has
held that in the context of discovery, there is no special rule protecting tax returns from
discovery by the opposing party. Erenstein v. S.E.C., 316 F. App'x 865, 869-70 (11th Cir.
2008)(“Nevertheless, in civil cases, we have not required a showing of compelling need
before tax information may be obtained by a party in discovery, but instead have determined
that such information need be only arguably relevant.”) Nonetheless, the potential invasion
of privacy posed by the disclosure of sensitive tax information is heightened by full access
by the public at large, as compared to only the opposing party for the purposes of pursuing
the litigation. As a result, the Court finds that the public policy concern expressed by
Congress in 26 U.S.C. § 6103 outweighs the public’s interest in access to these documents.
However, this finding does not preclude such return information from being introduced
through testimony in a public trial, where greater public interests may come into play. See

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Chicago Tribune Co., 263 F.3d at 1310.
Accordingly, the Court GRANTS Defendants’ motion to keep tax returns and return
information under seal. (Doc. no. 193.) The Clerk is DIRECTED to maintain under seal the
tax return information contained in Plaintiff’s notice of filing. (Doc. no. 181.)
SO ORDERED this 19th day of June, 2015, at Augusta, Georgia.

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