AGS, LLC et al v. Galaxy Gaming, Inc.

Filing 94

ORDER that 88 Motion to Seal is GRANTED. Signed by Magistrate Judge Carl W. Hoffman on 5/6/15. (Copies have been distributed pursuant to the NEF - MMM)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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AGS, LLC, et al.,

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Plaintiffs,
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vs.
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GALAXY GAMING, INC.,
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Defendant.
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____________________________________)

Case No. 2:14-cv-02018-JAD-CWH
ORDER

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Before this Court is Defendant and Counterclaimant Galaxy Gaming Inc’s (“Defendant”)

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motion to seal (doc. # 88), Plaintiffs and Counterclaimants AGS, LLC and Red Card Gaming Inc.’s

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(“Plaintiffs”) response (doc. # 92), and Defendant’s reply (doc. # 93).

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BACKGROUND

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This action arises from a dispute over the terms of the non-competition and asset purchase

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agreements that were entered into by Defendant and Plaintiff Red Card Gaming Inc. (“Red Card”).

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Plaintiff AGS, LLC is involved in this action, as it has been assigned Red Card’s rights and obligations

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under both the non-competition and asset purchase agreements.
DISCUSSION

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1.

Legal Standard

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The Ninth Circuit has comprehensively examined the common law right of public access to

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judicial files and records. See Kamakana v. City and County of Honolulu, 447 F.3d 1172 (9th Cir.

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2006). In Kamakana, the court recognized that different interests are at stake in preserving the secrecy

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of materials produced during discovery, and materials produced or presented in relation to dispositive

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motions. Id. at 1180-81. According to the court, two standards apply to account for these interests

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when evaluating requests to seal such materials.

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A party seeking to seal “private materials unearthed during discovery,” or to maintain the

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sealing of such materials when attached to non-dispositive motions, need only demonstrate “good

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cause” to justify sealing. Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 678 (9th Cir. 2010). “For good

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cause to exist, the party seeking protection bears the burden of showing specific prejudice or harm will

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result if no protective order is granted.” Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d

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1206, 1210-11 (9th Cir. 2002). In essence, “the public can gain access to litigation documents and

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information produced during discovery unless the party opposing disclosure shows ‘good cause’ why

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a protective order is necessary.” Id. at 1210. Thus, the “burden is on the party requesting a protective

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order to demonstrate that: (1) the material in question is a trade secret or other confidential

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information within the scope of Rule 26(c); and (2) disclosure would cause an identifiable, significant

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harm.” Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003) (citation

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omitted). “If a court finds particularized harm will result from disclosure of information to the public,

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then it balances the public and private interests to decide whether a protective order is necessary.” Id.

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at 1211 (citing Glenmede Trust Co. v. Thompson, 56 F.3d 476, 483 (3d Cir. 1995)).

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By contrast, a party seeking to seal a judicial record attached to a dispositive motion, or

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material that is presented at trial must articulate “compelling reasons” in favor of sealing. Kamakana,

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447 F.3d at 1178. Indeed, the “mere fact that the production of records may lead to a litigant’s

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embarrassment, incrimination, or exposure to further litigation will not, without more, compel the court

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to seal its records.” Id. (citation omitted). To justify sealing such documents, therefore, a party must

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present articulable facts identifying the interests favoring continued secrecy and show that these

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specific interests overcome the presumption of public access by outweighing the public’s interest in

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understanding the judicial process. Id. at 1181. Generally, requests for sealing are justified in cases

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in which the production of records would gratify private spite, encourage public scandal, circulate

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libelous statements, or release trade secrets. Id. at 1179.

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Analysis

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Defendant asks the Court to seal discrete portions of the parties’ joint status report, as the non-

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competition agreement entered into by Defendant with Red Card purportedly requires that the

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information at issue be held in confidence.

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Plaintiffs, in response, dispute various aspects of the non-competition agreement cited by

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Defendant, but claim they do not oppose Defendant’s sealing request at this time. However, Plaintiffs

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reserve the right to, among others, contest whether the information subject to sealing “is confidential

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[and] in need of any protections” in the future.

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In reply, Defendant contends that Plaintiffs “do not actually oppose” the instant motion, and

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it has shown “good cause” to seal the information at issue. Thus, Defendant asks the Court to grant

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its request.

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The Court reiterates once more that it will not consider Plaintiffs’ assertions regarding the non-

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competition agreement, as they are not properly before this Court. In light of Plaintiffs’ non-

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opposition to Defendants’ request, moreover, this Court grants the instant motion. Because Defendant

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has already filed a redacted version of the document at issue (doc. # 89), the Court will not require

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anything further at this time.
CONCLUSION AND ORDER

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Accordingly, IT IS HEREBY ORDERED that Defendant’s motion to seal (doc. # 88) is
granted.
DATED: May 6, 2015

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______________________________________
C.W. Hoffman, Jr.
United States Magistrate Judge

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