Universal Entertainment Corporation v. Aruze Gaming America, Inc. et al

Filing 173

ORDER Granting in part and Denying in part 169 Motion to Seal. Plaintiffs motion is GRANTED as to Exhibit 2. Plaintiffs motion is DENIED as to Exhibit 4. Defendants are ORDERED to file a notice of compliance attaching Exhibit 3, Exhibit 4, Exhibit 5, and their opposition redacted in accordance with the Order no later than 2/1/2023. Signed by Magistrate Judge Nancy J. Koppe on 1/18/2023. (Copies have been distributed pursuant to the NEF - TRW)

Case 2:19-cv-01657-RFB-NJK Document 173 Filed 01/18/23 Page 1 of 3

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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UNIVERSAL ENTERTAINMENT
CORPORATION,
Plaintiff,

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v.

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ARUZE GAMING AMERICA, INC., et al.,

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Case No. 2:19-cv-01657-RFB-NJK
ORDER
[Docket No. 169]

Defendants.
Pending before the Court is Plaintiff’s motion to seal portions of Defendants’ opposition

12 to Plaintiff’s motion for leave to file first amended complaint. Docket No. 169.
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The general presumption is that the public has the right to access judicial filings. See, e.g.,

14 Nixon v. Warner Commc’ns Inc., 435 U.S. 589, 597 (1978). Certain types of documents are
15 exempt from this presumption and have traditionally been kept secret. Kamakana v. City & Cnty.
16 of Honolulu, 447 F.3d 1172, 1179 (9th Cir. 2006). Ninth Circuit “case law has identified two
17 categories of documents that fall in this category: grand jury transcripts and warrant materials in
18 the midst of a pre-indictment investigation.” Id. The presumption of public access can, however,
19 be overcome for documents not traditionally kept secret. San Jose Mercury News, Inc. v. U.S. Dist.
20 Ct., 187 F.3d 1096, 1102 (9th Cir. 1999).
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In determining whether to seal documents, the applicable standard “turns on whether the

22 materials are submitted in conjunction with a dispositive or non-dispositive motion.” Victory
23 Sports & Ent., Inc. v. Pedraza, 2019 WL 2578767, *1 (D. Nev. 2019). A motion is dispositive
24 when it is “is more than tangentially related to the merits of a case.” Ctr. for Auto Safety v. Chrysler
25 Grp., LLC, 809 F.3d 1092, 1101 (9th Cir. 2016). The sealing of dispositive motions and related
26 documents is evaluated under a “compelling reasons” standard. Kamakana, 447 F.3d at 1179. Id.
27 A party must support its motion to seal dispositive filings by “articulat[ing] compelling reasons
28 supported by specific factual findings.” Id. at 1178. Sealing nondispositive motions requires a
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Case 2:19-cv-01657-RFB-NJK Document 173 Filed 01/18/23 Page 2 of 3

1 “particularized showing” under a “good cause” standard. Id. at 1180 (citing Foltz v. State Farm
2 Mut. Auto. Ins. Co., 331 F.3d 1122, 1138 (9th Cir. 2003).
Plaintiff seeks to seal Exhibits 2 and 4 to Defendants’ opposition to Plaintiff’s motion for

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4 leave to file first amended complaint and the portions of Defendants’ opposition discussing those
5 exhibits.1 2 Docket No. 169 at 2. Plaintiff submits that good cause exists to seal Exhibit 2 because
6 it contains internal valuations of claims that Plaintiff may bring or has brought in litigation. 3 Id.
7 Plaintiff further submits that the release of this information would undermine its ability to negotiate
8 settlements in current and future lawsuits. Id. “What constitutes a compelling reason is best left
9 to the discretion of the trial court.” Ctr. for Auto Safety, 809 F.3d at 1097 (quoting Nixon, 435
10 U.S. at 599). Protecting trade secrets or internal information that might otherwise harm a litigant’s
11 competitive standing is a compelling reason to keep records sealed. Kamakana, 447 F.3d at 1179;
12 Ctr. for Auto Safety, 809 F.3d at 1097. The Court has reviewed Exhibit 2 and agrees that its release
13 would harm Plaintiff’s ability to negotiate settlements in future litigation and Plaintiff’s broader
14 competitive standing. The Court, therefore, finds that compelling reasons exist to seal Exhibit 2
15 to Defendants’ opposition to Plaintiff’s motion for leave to file first amended complaint.
Plaintiff further submits that good cause exists to seal Exhibit 4 because it contains

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17 confidential communications between Plaintiff and the Nevada Gaming Control Board. Docket
18 No. 169 at 2. Plaintiff further submits that the release of Exhibit 4 would harm its relationship
19 with NGCB. Id. Exhibit 4 is an email from Plaintiff to NGCB forwarding a copy of a published
20 press release. As Plaintiff notes, the Court has previously sealed communications with law
21 enforcement and regulators to maintain the parties’ relationships with those agencies. Id. Exhibit
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Plaintiff’s motion contains several references to Defendants’ answer. See Docket No. 169
23 at 2. The Court addressed these discrepancies in the contemporaneously-issued order resolving
the motion at Docket No. 168. Accordingly, the Court construes the instant motion as pertaining
24 solely to Defendants’ opposition to Plaintiff’s motion for leave to file first amended complaint.
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Plaintiff removes the “Confidential” designation from Exhibits 3 and 5.

As the Court has previously noted, there is a split of authority as to whether procedural
motions, such as a motion for leave to amend, must satisfy either the good cause or compelling
27 reasons standard. See Docket No. 167 at 3 n.3. Once again, in the interest of certainty, the Court
applies the more demanding standard here. Regardless, Plaintiff has shown compelling reasons
28 exists to seal Exhibit 2.
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