Alcohol Monitoring Systems, Inc. v. Holper

Filing 10

ORDER Denying 3 Motion for Leave to File Complaint Under Seal. Unsealed Copy of Complaint due within 14 days. Plaintiff shall re-file an unsealed copy of its Certificate of Interested Parties. Signed by Magistrate Judge George Foley, Jr on 3/26/2013. (Copies have been distributed pursuant to the NEF - SLR)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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ALCOHOL MONITORING SYSTEMS,

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Plaintiff,
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vs.
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SCOTT HOLPER,
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Defendant.
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__________________________________________)

Case No. 2:13-cv-00399-GMNORDER
Motion for Leave to File
Complaint Under Seal (#3)

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This matter comes before the Court on Plaintiff’s Motion for Leave to File Complaint

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Under Seal (#3), filed on March 8, 2013. Plaintiff filed the Complaint (Doc. #1) under seal on

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March 8, 2013, alleging Defendant violated a confidential settlement agreement with Plaintiff. The

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Court ordered Plaintiff to provide a copy of the settlement agreement at issue, see Order, Doc. #7,

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which Plaintiff filed under seal on March 19, 2013 (Doc. #9).

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The Supreme Court has recognized a “general right to inspect and copy public records and

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documents, including judicial records and documents.” Nixon v. Warner Comm., Inc., 435 U.S.

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589, 597 & n. 7 (1978). A narrow range of documents is not subject to the right of public access

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because the records have “traditionally been kept secret for important policy reasons.” Times

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Mirror Co. v. United States, 873 F.2d 1210, 1219 (9th Cir. 1989). Unless a particular court record

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

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Foltz v. State Farm Mutual Auto. Insurance Company, 331 F.3d 1122, 1135 (9th Cir. 2003) (citing

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Hagestad v. Tragesser, 49 F.3d 1430, 1434 (9th Cir. 1995)). The moving party must articulate

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compelling reasons supported by specific factual findings that “outweigh the general history of

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access and the public policies favoring disclosure.” Kamakana v. City of Honolulu, 447 F.3d 1172,

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1178 (9th Cir. 2006) (internal citations omitted).

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Although a “good cause” standard applies to motions to seal documents attached to non-

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dispositive motions, see id. at 1179-80, the “compelling reasons” standard applies to motions to

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seal all or part of a complaint. See, e.g., In re NVIDIA Corp. Derivative Litigation, 2008 WL

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1859067, *4 (N.D. Calif., April 23 2008). Compelling reasons sufficient to justify sealing court

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records exist “when such court files might [...] become a vehicle for improper purposes, such as the

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use of records to gratify private spite, promote public scandal, circulate libelous statements, or

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release trade secrets.” Kamakana, 447 F.3d at 1179 (internal citations omitted).

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Plaintiff moves to seal its entire Complaint. The Complaint alleges Defendant, an attorney,
violated a confidential settlement agreement by advertising that Defendant’s client received a

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settlement from Plaintiff. The advertisements also allegedly disclose the amount of settlement.1

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The agreement between the parties in the underlying settlement provides that “[n]o party shall

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disclose the fact or amount of Settlement without the prior written consent of the other party.” See

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Doc. #9 at 4. In “conscientiously balancing” the interests at stake, see Foltz, 331 F.3d at 1135, the

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Court finds that Plaintiff’s interest in keeping secret the fact that a settlement occurred does not

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outweigh the strong presumption that the public have access to the Complaint. Plaintiff has opted

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to pursue this action in a public forum. “The mere fact that the production of records may lead to a

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litigant’s embarrassment, incrimination, or exposure to further litigation will not, without more,

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compel the court to seal its records.” Kamakana, 447 F.3d at 1179. In further balancing the

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interests, however, the Court does find compelling reasons to seal the amount of settlement and the

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material terms of the settlement agreement. Therefore, Plaintiff shall file an unsealed copy of the

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Complaint with the material terms of the agreement and the amount of settlement redacted. The

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copy of the agreement (Doc. #9) filed pursuant to the Court’s Order (Doc. #7) and the original

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Complaint (Doc. #1) shall remain sealed.

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The Court also notes that Plaintiff filed its Certificate of Interested Parties (CIP) (#2) under
seal. Plaintiff did not seek leave to file the CIP under seal, and has not shown good cause for the

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In another cause of action for false advertising within the Complaint, Plaintiff alleges the settlement amount
disclosed is inaccurate.

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Court to seal its CIP. Accordingly,
IT IS HEREBY ORDERED that Plaintiff’s Motion for Leave to File Complaint Under
Seal (#3) is denied.
IT IS FURTHER ORDERED that Plaintiff shall re-file within 14 days of the date of this

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Order an unsealed copy of its Complaint with the amount of settlement and other material terms of

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the settlement agreement redacted.

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IT IS FURTHER ORDERED that Plaintiff shall re-file an unsealed copy of its Certificate
of Interested Parties.
DATED this 26th day of March, 2013.

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______________________________________
GEORGE FOLEY, JR.
United States Magistrate Judge

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