OSG Ship Management, Inc. v. O.W. Bunker USA, Inc. et al

Filing 171

ORDER granting 169 Letter Motion to Seal. Application GRANTED. By no later than Friday, October 1, 2021, the parties must file an unredacted version of the proposed stipulation and order. The parties may file the unredacted version under seal on ECF or they may email a copy to Chambers. SO ORDERED. (Signed by Judge Valerie E. Caproni on 9/27/2021) (vfr)

USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #:
DATE FILED:

MEMO ENDORSED
Robert E. O’Connor
New York Managing Partner

437 Madison Avenue
New York, NY 10022
Tel: [phone]

Direct Dial:
212-551-7794
Email:
[e-mail]

September 24, 2021
Via Email
The Honorable Valerie E. Caproni
United States District Court for the Southern District of New York
Thurgood Marshall United States Courthouse
40 Foley Square
New York, NY 10007
Re:

OSG Ship Management, Inc. v. O.W. Bunker USA Inc.,
Case No. 14 Civ. 9973

Dear Judge Caproni,
The undersigned law firm represents Defendant O.W. Bunker USA Inc.
(“OW USA”) in the above-captioned consolidated interpleader action. Pursuant to
Your Honor’s Individual Rules of Practice in Civil Cases, we respectfully submit
this letter for leave (1) to seal the highlighted portion of the enclosed Stipulation
and Proposed Order for Dismissal with Prejudice of OSG Ship Management, Inc.,
and Order for Discharge from Further Liability in this Interpleader Action (the
“Stipulation”) and (2) to seal the docket entry reflecting the amount of the
withdrawal from the Court Registry Investment System (“CRIS”) during the
pendency of related cases.1 Taking these limited steps is appropriate in light of
Second Circuit precedent because the redactions are narrowly tailored, the public
interest in release of such material is negligible, and even if any presumption
applied, such interest is outweighed by the interests outline in more detail below.
1

This Court granted substantially similar requests for leave to redact in Clearlake Shipping Pte.
Ltd. v. O.W. Bunker (Switzerland) SA, Case No. 14 Civ. 9287 (VEC), Docket No. 263 (S.D.N.Y.
Sept. 21, 2018) and Nippon Kaisha Line Limited v. O.W. Bunker USA Inc., Case No. 14 Civ.
10091 (VEC), Docket No. 221 (S.D.N.Y. Mar. 4, 2019).

Montgomery McCracken Walker & Rhoads LLP

Hon. Valerie E. Caproni
September 24, 2021
Page 2

Plaintiff OSG Ship Management, Inc. (“OSG”) and Defendants Chemoil Middle
East DMCC and GPS Chemoil LLC FZC (collectively, “Chemoil”) consent to this
letter motion.
I.

The Information to be Sealed Does Not Constitute a “Judicial
Document” Under Lugosch and a Presumption of Public Access Should
Not Apply

A document filed with a court is not necessarily a “judicial document”;
instead, “the item filed must be relevant to the performance of the judicial function
and useful in the judicial process.” Lugosch v. Pyramid Co. of Onondaga, 435
F.3d 110, 115 (2d Cir. 2006) (quoting United States v. Amodeo, 44 F.3d 141, 145
(2d Cir. 1995)). OW USA’s application seeks only to redact the highlighted
information within the Stipulation and to seal the related docket entry reflecting the
amount of the withdrawal from the Court’s registry. Unlike the documents in
Lugosch—which the court relied on when making its summary judgment
determination—the information sought to be sealed here is not relevant to the
performance of the judicial function or useful in the judicial process (e.g., a
summary judgment determination). Here, by contrast, the information sought to be
sealed is similar to that referenced in Perez v. Jupada Enterprises where the
parties’ “settlement documents were not filed with the court and were not the basis
for the court's adjudication.” Perez v. Jupada Enterprises, Inc., Case No. 10 Civ.
3118 (JMF), 2012 WL 3042928, at *4 (S.D.N.Y. July 25, 2012) (granting
application to seal with respect to redactions of letters that referred to terms of a
confidential settlement agreement) (citing Gambale v. Deutsche Bank AG, 377
F.3d 133, 143 (2d Cir. 2004)). Accordingly, the presumption of public access
should not apply under these circumstances.
II.

If the Presumption of Public Access Applies, It Is Weak Given the
Narrowly Tailored Redactions, and It Is Outweighed by Competing
Concerns

Even if such a presumption applied, however, OW USA’s request is
narrowly tailored and seeks to redact only that portion of the Stipulation relating to
the terms of a confidential settlement agreement and the amount of funds to be
remitted to OSG from the CRIS. As relevant here, the Second Circuit has found
that passing references to the amount of a confidential settlement agreement has at

Montgomery McCracken Walker & Rhoads LLP

Hon. Valerie E. Caproni
September 24, 2021
Page 3

most an attenuated connection to the interests sought to be preserved by the
presumption of public access to judicial documents. See Gambale v. Deutsche
Bank AG, 377 F.3d 133, 143 (2d Cir. 2004) (finding the presumption was “weak”
when the amount of the settlement was confidential).
Redacting only those portions of the Stipulation pertaining to the amounts of
the parties’ confidential settlement agreement is narrowly tailored to serve the
parties’ interest and outweighs any presumption that might apply. The confidential
settlement agreement was entered into following the conclusion of a confidential
mediation process and which the parties entered into with the expectation that its
terms would remain confidential. Sellick v. Consol. Edison Co. of New York, Inc.,
Case No. 15 Civ. 9082 (RJS), 2017 WL 1133443, at *8 (S.D.N.Y. Mar. 23, 2017)
(“the parties' interest in maintaining the confidentiality of their settlement is clearly
a countervailing interest that may overcome the presumption in favor of open
records where, as here, the settlement itself was conditioned on confidentiality …
The Court finds that Plaintiff’s limited redaction requests of details related to her
contemplated confidential settlement are narrowly tailored to serve the parties'
interest in maintaining the confidentiality of their settlement.”) (internal quotations
and citation omitted)).
Furthermore, the disclosure of non-public commercially sensitive
information may well create unexpected transaction costs and inefficiencies among
the parties, disrupting the expectation of confidentiality. Standard Inv. Chartered,
Inc. v. Fin. Indus. Regulatory Auth., Ind., 347 F. App'x 615, 617 (2d Cir. 2009)
(affirming narrowly tailored redaction of financial data that would subject
disclosing party to “financial harm” and “competitive disadvantage”). In Standard
Inv. Chartered, the Second Circuit affirmed the National Association of Securities
Dealers’ (“NASD”) analogous request to redact financial data where “an outsider
with knowledge … could upon viewing the facts and figures in NASD's records,
use that information to deduce NASD's negotiation tactics” which could pose
competitive disadvantage to NASD. Id. (internal quotations and citation omitted).
Here, the redacted portions of the Stipulation contain commercially sensitive
information that could potentially prejudice negotiations in numerous pending
related cases in which the same issues might arise. Redacting the suggested
portions of the Stipulation and sealing the docket entry reflecting the amount of the
withdrawal from the CRIS, at least during the pendency of these related cases, is a

Montgomery McCracken Walker & Rhoads LLP

Hon. Valerie E. Caproni
September 24, 2021
Page 4

narrowly tailored step that properly balances any presumption of public access
with the parties’ countervailing commercial interests and expectation of
confidentiality.
For the foregoing reasons, OW USA, with the consent of OSG and Chemoil,
respectfully requests leave (1) to seal the highlighted portion of the enclosed
Stipulation and (2) to seal the docket entry reflecting the amount of the withdrawal
from the CRIS. Please do not hesitate to contact the undersigned if you have any
questions or comments.
Respectfully submitted,
/s/ Robert E. O’Connor
Robert E. O'Connor
Encl.:
cc:

Stipulation (with proposed redactions highlighted)
All Counsel of Record (by email)

SO ORDERED.

HON. VALERIE CAPRONI
UNITED STATES DISTRICT JUDGE