Capitol Records, LLC v. Redigi Inc.

Filing 216

DECLARATION of GARY ADELMAN in Support re: 214 MOTION for Protective Order to Seal.. Document filed by Redigi Inc.. (Attachments: # 1 Exhibit 1-2, # 2 Affidavit Certificate of Service)(Adelman, Gary)

Exhibit 1 
(FILED UNDER SEAL PENDING RULING ON MOTION) 

EXHIBIT 2 

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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CAPITOL RECORDS, et al.,

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Plaintiffs,

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v.
REDIGI INC., et al.,

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12 Civ. 95 (RJS)

Defendants.
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April 4, 2016
12:05 p.m.
Before:
HON. RICHARD J. SULLIVAN,

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District Judge
APPEARANCES

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COWAN, LIEBOWITZ & LATMAN, P.C.
Attorneys for Plaintiffs
BY: RICHARD S. MANDEL
JONATHAN Z. KING

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ADELMAN MATZ, P.C.
Attorneys for Defendant Redigi
BY: GARY P. ADELMAN
SARAH M. MATZ
MISCHON DE REYA NEW YORK, LLP
Attorneys for Defendants
BY: VINCENT FILARDO
MICHAEL S. DeVINCENZO

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SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

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(Case called)

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THE COURT:

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MR. MANDEL:

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Let me take appearances for the plaintiff.
Richard Mandel, Cowan, Liebowtiz &

Latman.

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THE COURT:

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MR. KING:

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THE COURT:

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And for the defendants?

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MR. ADELMAN:

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MS. MATZ:

Jonathan King, Cowan, Liebowtiz & Latman.
All right, Mr. King.

THE COURT:

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Okay, Mr. Mandel.

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Good afternoon.
Good afternoon, your Honor.

THE COURT:

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MR. FILARDO:

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Ms. Matz, good afternoon.
Good afternoon, your Honor.

THE COURT:

Mr. Filardo, this is our first time

meeting, right?
MR. FILARDO:

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MR. DeVINCENZO:

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Yes, it is, your Honor.
Michael DeVincenzo for Jon

Ossenmacher, Larry Rudolph, and Redigi.
THE COURT:

Okay, Mr. DeVincenzo.

It is my first time

meeting you as well?

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THE DEFENDANT:

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THE COURT:

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Vincent

Filardo for John Ossenmacher, Larry Rudolph, and Redigi.

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Sarah Matz,

Adelman Matz for Redigi.

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Gary Adelman.

Yes.

So, we are all set for trial, right?

That's what I thought.

I thought we were going to talk about

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

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trial today but I am informed that the parties have settled; is

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that right?

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MR. ADELMAN:

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THE COURT:

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Okay.

So, are you prepared to put the

terms of the settlement on the record?

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MR. ADELMAN:

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THE COURT:

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MR. ADELMAN:

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That's correct, your Honor.

We actually have signed agreements.

Oh, you do.
Yes.

If you don't mind, we will talk

about it.

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MR. MANDEL:

We have signed agreements as of this

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morning.

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submit a final judgment, basically what's been agreed to is the

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remedy phase which was going to go to trial, so the amount of

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damages and the form of an injunction that would resolve the

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case in the District Court wile reserving the defendant's right

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to appeal to the Second Circuit from the summary judgment

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ruling that formed the basis for liability.

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The only sort of logistical issue is that in order to

And so, what the parties have done is reached an
agreement.

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THE COURT:

So, it is turning on contingencies that

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are not yet fully known but this is not just basically an

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agreement to agree?

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MR. MANDEL:

No, no.

There is a form of judgments:

If X happens we file this; if Y happens we file this.

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THE COURT:

I am a little fuzzy as to what those

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contingencies are.

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Go ahead.

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MR. ADELMAN:

The

agreements are signed,

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The damages in this case
have been fully stipulated,

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THE COURT:

What's the contingency?

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MR. ADELMAN:

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THE COURT:

I see.

Okay.

So it really turns on

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MR. ADELMAN:

That's right.

There is nothing left to

chance as far as your Honor is concerned.

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THE COURT:

And there is a payment schedule that is

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worked out in the agreements?

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MR. MANDEL:

Is that right?

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THE COURT:

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MR. MANDEL:

Pending the appeal, you mean?
Yes, pending the appeal.

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THE COURT:

Okay.

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Mr. Filardo, did you want to say something.

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MR. FILARDO:

Just to make it clear, that strictly

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speaking these are stipulated judgments, it is an aside

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agreement to effectuate what has just been discussed before

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your Honor.

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agreement given the fact that all of these are going to be

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pending appeal so we still need to have an opportunity to have

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the appeal.

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I wouldn't necessarily call it a settlement

It is not a final judgment debt.

THE COURT:

Well, I haven't seen the papers so maybe

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it will all be clear once I look at those.

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suggesting?

So, what are you

That this would be an interlocutory appeal?

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MR. FILARDO:

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It is just that, it is a stipulated judgment with the

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No, your Honor.

Excuse me.

right of appeal.

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THE COURT:

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Okay.

Yeah.

That's what I understood

from the beginning.

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, right?

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MR. ADELMAN:

Correct.

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MR. FILARDO:

Correct.

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MR. ADELMAN:

Yes, sir.

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THE COURT:

Okay.

All right.

Well, it seems like the

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only thing you folks could agree on was that you didn't want to

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try this case in front of me.

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brought you together.

I guess it is good that I

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Well, it was an interesting case I am candidly a

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little disappointed because I thought it would be an

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interesting trial, too, just on the damages side of this but --

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but -- it seems like you know what you are doing.

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doubt that.

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authority or the inclination to look under the hood of your

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settlement.

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certain small segment of cases where that is the case, but some

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part of me is a little disappointed.

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No reason to

Even if he did, I really wouldn't have the

It is very rare that Courts ever do that and a

Nonetheless, so you will give me the written
agreements now, you will hand those up?

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Is that the plan?

MR. MANDEL:

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There is
obviously nothing left to try, and to maybe by the order,

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THE COURT:

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MR. MANDEL:

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So what is it that is signed now?
It is a private settlement agreement that

basically provides the mechanics

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that will be entered and other issues that are

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resolved between the parties.

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THE COURT:

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So you are not talking about docketing

that?

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MR. MANDEL:

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MR. ADELMAN:

No.

No.

Your Honor, we have no objection to

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showing you the agreements in camera if your Honor would like

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to review it.

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THE COURT:

I am not sure I really need to.

This is

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not the case where I need to approve a settlement but you have

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said here on the record certain terms that you have agreed

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upon, not all of them, obviously, but there is no plan to make

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that part of the record.

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MR. ADELMAN:

That's what you are saying.

That's correct, and we would like the

transcript to remain confidential until we have actually filed
the judgments.

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THE COURT:

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MR. MANDEL:

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MR. ADELMAN:

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MR. MANDEL:

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I think we would prefer.
Yes, we would prefer it.
A judgment obviously would be submitted,

that will be public --

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MR. ADELMAN:

Correct.

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MR. MANDEL:

--

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THE COURT:

Look.

There is a presumption of open

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records and open proceedings and this is not a sealed

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proceeding, so what would overcome that presumption with

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respect to what's been said here on the record?

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MR. ADELMAN:

Only that the -- there are -- I think

both parties would prefer

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, the judgment that we ultimately

SOUTHERN DISTRICT REPORTERS, P.C.
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filed.

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THE COURT:

But why?

The fact that the parties prefer

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it is generally not going to get you over the presumption so

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you need to have something more than that.

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MR. MANDEL:

I think it is a private settlement

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agreement that would not have been publicly filed.

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really planning to go into the terms of it.

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state them.

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THE COURT:

We weren't

Mr. Adelman didn't

The reason that I a Judge will ask for the

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terms is to make sure this thing is really settling as opposed

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to just a ploy for an adjournment.

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you are doing.

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MR. MANDEL:

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MR. ADELMAN:

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THE COURT:

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.

Right.
Right.

But that is always the worry,

And you can come back and, Funny thing.

We

didn't reach a settlement and we will take a trial now.

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I'm not saying that's what

MR. ADELMAN:

That's why I was suggesting that you

review the sides element document, in camera.

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THE COURT:
I can hang a hat on.

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Okay.

MR. ADELMAN:

Well, that's the sort of thing that

That makes more sense.
I'm sorry I didn't say that in the first

place.

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THE COURT:

Well, you don't have to apologize but I

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think there is a presumption of open records and open

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proceedings that is pretty serious, and so there has to be a

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good reason to seal things or redact things and it sounds like

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what you are saying is

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MR. ADELMAN:

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THE COURT:

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Correct, your Honor.

-- in the preferred way.

MR. ADELMAN:

Yes.

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THE COURT:

Well, look.

I would be issuing what I

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would typically call a 60-day order which just says that this

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case is closed.

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it but I am not planning that are you going to reopen it and

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say let's go to trial because that's come and gone.

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However, within 60 days the parties can reopen

MR. MANDEL:

I think the one concern, because we

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anticipated that somebody might want to obviously, you know,

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that it is common to file those kind of orders; I mean, we did

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want to alert your Honor to the fact that we definitely are

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going to want to present a final judgment.

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I mean, obviously from the plaintiff's perspective
there is an injunction that we are seeking that that is not in

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place at this point in addition to damages.

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THE COURT:

Right.

So, it will be a final judgment

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that lays out sort of injunctive relief and also I guess

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explicitly the carve outs for an appeal.

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MR. MANDEL:

Yes.

The final judgment will explicitly

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carve out the appeal and have formal judgment and amount of

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damages.

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THE COURT:

Why don't we do this then.

folks get a copy of the transcript.

Why don't you

I will give you a week to

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figure out whether there are portions of it that should be

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redacted because I don't think the whole thing probably needs

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to be redacted, right?

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MR. ADELMAN:

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THE COURT:

Probably not.

The facts of the settlement is pretty

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clear and if anybody wasn't, it certainly would be by Monday

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morning.

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redacted version, or if you think the whole thing needs to be

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sealed you can articulate that, but with citation and reference

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to the key case law on this, which I guess the key civil case

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is Lugosch, which is the key Second Circuit case on the

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subject.

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So, why don't you then submit to me a proposed

MR. ADELMAN:

Yes, your Honor.

We have made this

motion with you before.
THE COURT:
let's do that.

Yes, so you know what you are doing but

A week is enough time to do that?

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MR. ADELMAN:

I believe so, yes.

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THE COURT:

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Anything else we should cover today?

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MR. MANDEL:

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THE COURT:

Okay.

All right.

I don't think so, your Honor.
So, I don't think I need to review in

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camera the terms.

I just think it would be interesting.

I

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would love to do it but I don't think it is necessary for

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anything that I have to do.

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sealing or redacting, then you can attach it or send it to me,

If it is relevant to the issue of

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but I think otherwise what I have heard so far suggests that

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there are good reasons to redact at least portions of this

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transcript and some of the terms of the settlement at this

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point.

Okay?

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MR. ADELMAN:

Thank you, your Honor.

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MR. MANDEL:

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THE COURT:

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So, I will hear from you I guess in a couple of months

Thank you, your Honor.
All right.

That's it, then.

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and I will see what the Court of Appeals has to say about it

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which will be interesting.

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Good luck.

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MR. MANDEL:

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THE COURT:

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OFFICIAL REPORTER:

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THE COURT:

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Okay?

Thanks to all of you.
Thank you.
Let me thank the court reporter as always.
You are welcome.

You will need a copy of this so you can

buy it now or later through the website but might as well do it

SOUTHERN DISTRICT REPORTERS, P.C.
[phone]

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now.

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MR. ADELMAN:

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MR. MANDEL:

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THE COURT:

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Thank you, your Honor.
Thank you, your Honor.

Good.

Take care.
o0o

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SOUTHERN DISTRICT REPORTERS, P.C.
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