Federal Trade Commission v. Revmountain LLC et al

Filing 71

ORDER. IT IS HEREBY ORDERED that 41 Defendants Revguard LLC, Revlive!, LLC, and Roadrunner B2C LLC's Motion for Leave to File Exhibits Under Seal is GRANTED, in part, and DENIED, in part. See Order for details. Signed by Magistrate Judge George Foley, Jr on 9/13/17. (Copies have been distributed pursuant to the NEF - MR)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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FEDERAL TRADE COMMISSION,

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Plaintiff,
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vs.
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REV MOUNTAIN, LLC, et al.,
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Defendants.
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__________________________________________)

Case No. 2:17-cv-02000-APG-GWF
ORDER

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This matter is before the Court on Defendants Revguard LLC, Revlive!, LLC, and

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Roadrunner B2C LLC’s Motion for Leave to File Exhibits Under Seal (ECF No. 41), filed on

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August 18, 2017. Plaintiff filed its Opposition (ECF No. 51) on August 25, 2017. The Court

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temporarily granted Defendants’ motion on August 28, 2017 to allow the District Judge to examine

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the exhibits in preparation for the motion for preliminary injunction hearing. See ECF No. 52.

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Defendants request leave to file exhibits attached to their Opposition to Plaintiff’s motion

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for preliminary injunction under seal. Defendants represent that the documents contained in the

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exhibits are tax returns, financial information, customer information, and accounting records and

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that Plaintiff does not oppose filing the tax records under seal. Plaintiff does not oppose

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Defendants’ request to file the tax records under seal, but argues that Defendants did not provide

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sufficient basis to seal the following: (1) individual and corporate bank statements summarizing

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activity for the month of July or August 2017, Exs. GG, HH, JJ, KK, LL, and MM; (2) powerpoint

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presentations containing a broad overview of the Rev Entities’ business, Exs. J, M, and G; (3)

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undated purported lists of customers, Exs. R, S, and T; and (4) six months of payroll records for

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RevGuard, RevLive, and RevGo, Exs. U, X, and AA.

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The Ninth Circuit comprehensively examined the presumption of public access to judicial

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files and records in Kamakana v. City and County of Honolulu, 447 F.3d 1172 (9th Cir. 2006).

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There, the court recognized that different interests are at stake in preserving the secrecy of materials

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produced during discovery and materials attached to dispositive motions. The Kamakana court held

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that a “good cause” showing is sufficient to seal documents produced during discovery. Id. at

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1180. However, the Kamakana decision also held that a showing of “compelling reasons” is needed

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to support the secrecy of documents attached to dispositive motions. A showing of “good cause”

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does not, without more, satisfy the “compelling reasons” test required to maintain the secrecy of

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documents attached to dispositive motions. Id.
Kamakana recognized that “compelling reasons” sufficient to outweigh the public’s interests

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in disclosure and justify sealing records exist when court records may be used to gratify private

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spite, permit public scandal, circulate libelous statements, or release trade secrets. Id. at 1179

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(internal quotations omitted). However, “[t]he mere fact that the production of records may lead to

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

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compel the court to seal its records.” Id., citing, Foltz v. State Farm Mutual Auto Insurance

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Company, 331 F.3d 1122, 1136 (9th Cir. 1995). To justify sealing documents attached to

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dispositive motions, a party is required to present articulable facts identifying the interests favoring

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continuing secrecy and show that these specific interests overcome the presumption of public access

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by outweighing the public’s interests in understanding the judicial process. Id. at 1181 (internal

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citations and quotations omitted).

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The documents contained in the exhibits appear to be relevant. The Court grants

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Defendants’ request to file the tax returns under seal. Sufficient compelling reasons, however, have

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not been provided to show why the remaining documents should be filed under seal. Defendants

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shall redact personal identifying information from the remaining exhibits and file it unsealed.

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Accordingly,

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...

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...

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...
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IT IS HEREBY ORDERED that Defendants Revguard LLC, Revlive!, LLC, and

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Roadrunner B2C LLC’s Motion for Leave to File Exhibits Under Seal (ECF No. 41) is granted, in

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part, and denied, in part, as follows:

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1.

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Defendants shall redact personal information from Exhibits GG, HH, JJ, KK, LL,
MM, J, M, G, R, S, T, U, X, AA and file them unsealed.

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2.

Exhibits V and Y containing tax returns may be filed under seal.

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DATED this 13th day of September, 2017.

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______________________________________
GEORGE FOLEY, JR.
United States Magistrate Judge

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