Hologram USA, Inc. et al v. Pulse Evolution Corporation et al

Filing 432

ORDER granting in part and denying in part #423 Motion for Leave to File. Exhibits 2, 3, and 5 to the Chan Declaration shall remain under seal. Exhibits 1, 4, and 6-10 to the Chan Declaration shall not be filed under seal. No later than 10/12/2016, Plaintiffs shall file Exhibits 1, 4, and 6-10 on the public docket. The Courts Order to Show Cause, Docket No. 430, is hereby DISCHARGED. Signed by Magistrate Judge Nancy J. Koppe on 10/5/16. (Copies have been distributed pursuant to the NEF - JM)

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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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HOLOGRAM, USA, INC.,

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Pending before the Court is the UK Defendants’ Response to the Court’s September 26,

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2016 Order to Show Cause. Docket No. 431. In compliance with the Court’s order, Docket No.

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430, Defendants filed a declaration supporting Plaintiffs’ motion to seal. Docket No. 431. The

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motion discusses Exhibits 1-10 to the Supplemental Declaration of May Chan (“Chan Declaration”).

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See, e.g., Docket No. 423 at 4.1 Defendants indicate that Exhibits 1, 4, and 6-10 to the Chan

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Declaration can be filed unsealed, but maintain that Exhibits 2, 3, and 5 should remain under seal.

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Docket No. 431 at 3.

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Plaintiff(s),
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vs.
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GLOBAL CASH ACCESS, INC.,
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Defendant(s).

Case No. 2:14-cv-00772-GMN-NJK
ORDER
(Docket No. 431)

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The parties’ page numbering is inconsistent with CM/ECF’s page numbering. This
order refers to page numbers as designated by CM/ECF.

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I.

STANDARDS

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The Ninth Circuit has held that there is a strong presumption of public access to judicial

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records. See Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006); Foltz v.

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State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003). A party seeking to file

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documents under seal bears the burden of overcoming that presumption. Pintos v. Pac. Creditors

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Ass’n, 605 F.3d 665, 678 (9th Cir. 2010) (quoting Kamakana, 447 F.3d at 1178). Parties “who seek

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to maintain the secrecy of documents attached to dispositive motions must meet the high threshold

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of showing that ‘compelling reasons’ support secrecy.” Kamakana, 447 F.3d at 1180. Those

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compelling reasons must outweigh the competing interests of the public in having access to the

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judicial records and understanding the judicial process. Id. at 1178-79; see also Pintos, 605 F.3d

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at 679 & n.6 (court must weigh “relevant factors,” including the public’s interest in understanding

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the judicial process).

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The Ninth Circuit has indicated that “‘compelling reasons’ sufficient to outweigh the public’s

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interest in disclosure and justify sealing court records exist when such ‘court files might have

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become 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 F.3d at 1179

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(citing Nixon v. Warner Commc’ns Inc., 435 U.S. 589, 598 (1978)); see also Apple Inc. v. Samsung

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Elecs. Co., 727 F.3d 1214, 1221-22 (Fed. Cir. 2013) (applying Ninth Circuit law regarding

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competitive harm to business and the definition of “trade secret”). On the other hand, “[t]he mere

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fact that the production of records may lead to a litigant’s embarrassment, incrimination, or exposure

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to further litigation will not, without more, compel the court to seal its records.” Kamakana, 447

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F.3d at 1179 (citing Foltz, 331 F.3d at 1136).

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The burden to show compelling reasons for sealing is not met by general assertions that the

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information is “confidential” or a “trade secret,” but rather the movant must “articulate compelling

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reasons supported by specific factual findings.” Id. at 1178. The Ninth Circuit has rejected efforts

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to seal documents under the “compelling reasons” standard based on “conclusory statements about

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the contents of the documents–that they are confidential and that, in general,” their disclosure would

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be harmful to the movant. Id. at 1182; see also Vaccine Ctr. LLC v. GlaxoSmithKline LLC, 2013

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U.S. Dist Lexis 68298, at *5-6 (D. Nev. May 14, 2013) (finding insufficient general assertions

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regarding confidential nature of documents). Such “conclusory offerings do not rise to the level of

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‘compelling reasons’ sufficiently specific to bar the public access to the documents.” Kamakana,

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447 F.3d at 1182. In allowing the sealing of a document, the Court must base its decision on a

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compelling reason and must “articulate the basis for its ruling, without relying on hypothesis and

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conjecture.” See, e.g., Pintos, 605 F.3d at 679 (quoting Hagestad v. Tragesser, 49 F.3d 1430, 1434

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(9th Cir. 1995)).

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Lastly, to the extent any confidential information can be easily redacted while leaving

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meaningful information available to the public, the Court must order that redacted versions be filed

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rather than sealing entire documents. Foltz, 331 F.3d at 1137; see also In re Roman Catholic

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Archbishop of Portland in Oregon, 661 F.3d 417, 425 (9th Cir. 2011) (the district court must “keep

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in mind the possibility of redacting the sensitive material”).

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II.

ANALYSIS

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The pending motion, Docket No. 423, seeks to seal three exhibits attached to summary

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judgment briefing, which triggers the “compelling reasons” standard. Defendants’ declaration in

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support of the motion, Docket No. 431, identifies the type of information at issue in each document,

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including confidential customer information, sales and payment terms, and licensing fees and terms.

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See, e.g., id. at 2. Defendants also provide declaratory evidence indicating that public release of the

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information would be harmful and specifying the type of harm that would arise, including harm to

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Defendants’ competitive standing in the marketplace. See id. at 3; id., Exhibit A. In addition,

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Defendant submits that Exhibits 2, 3, and 5 to the Chan Declaration cannot be easily redacted while

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leaving meaningful information available to the public. See id. at 2. Based on the specifically

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articulated showings made in Defendants’ response and declaration, the Court GRANTS the motion

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to seal, Docket No. 423, as it relates to the following documents:

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Exhibit 2 to the Chan Declaration (Docket No. 425-1)

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Exhibit 3 to the Chan Declaration (Docket No. 425-2)

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Exhibit 5 to the Chan Declaration (Docket No. 425-4)

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III.

CONCLUSION

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For the reasons outlined above, the motion to seal, Docket No. 423, is hereby GRANTED

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in part and DENIED in part. Exhibits 2, 3, and 5 to the Chan Declaration shall remain under seal.

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Exhibits 1, 4, and 6-10 to the Chan Declaration shall not be filed under seal. No later than October

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12, 2016, Plaintiffs shall file Exhibits 1, 4, and 6-10 on the public docket. The Court’s Order to

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Show Cause, Docket No. 430, is hereby DISCHARGED.

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IT IS SO ORDERED.

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DATED: October 5, 2016

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______________________________________
NANCY J. KOPPE
United States Magistrate Judge