U.S. Tobacco Cooperative Inc. et al v. Big South Wholesale of Virginia, LLC d/b/a Big Sky International et al

Filing 142

ORDER granting Motions to Seal 126 and 133 and Correction of Scheduling Order. The Clerk is directed the maintain the following documents under seal: 122 , 124 , 125 , 128 , 130 , 132 . The court hereby orders all dispositive motions be filed no later than 11/30/14. All other deadlines remain in effect. Signed by Senior Judge James C. Fox on 4/18/2014. (Foell, S.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:13-CV-527-F
U.S. TOBACCO INC., U.S FLUECURED TOBACCO GROWERS, INC.,
and BIG SOUTH DISTRIBUTION, LLC,

Plaintiffs,

v.
BIG SOUTH WHOLESALE OF
VIRGINIA, LLC, d/b/a BIG SKY
INTERNATIONAL, BIG SOUTH
WHOLESALE,LLC,UNIVERSAL
SERVICES FIRST CONSULTING, a/k/a
UNIVERSAL SERVICES CONSULTING
GROUP, JASON CARPENTER,
CHRISTOPHER SMALL, EMORY
STEPHEN DANIEL, and other unnamed
co-conspirators,
Defendants.

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ORDER

This matter is before the court on the motions to seal [DE-126; DE-133] filed by Defendants
Big South Wholesale of Virginia LLC, d/b/a Big Sky International, Big South Wholesale, LLC,
Jason Carpenter, and Christopher Small (collectively, "Big Sky Defendants").

I. MOTIONS TO SEAL
The Big Sky Defendants seek to (1) file under seal their Memorandum in Opposition to
Plaintiffs' First Motion to Compel and the exhibits thereto, and publicly file a redacted version of
the Memorandum; (2) file under seal their Memorandum in Opposition to Plaintiffs' Second Motion
to Compel and an exhibit thereto; (3) file under seal their Memorandum in Support of their Motion

to Stay and publicly file a redacted version of the same; (4) file under seal their Memorandum in
Support of their Motion to Amend the Protective Order Governing Discovery and Confidential
Information , and (4) file under their memorandum in support of their motions to seal.
The Fourth Circuit has directed that prior to sealing judicial records, a district court must first
determine the source of the public's right to access the judicial records: the common law or the First
Amendment. Stone v. Univ. ofMd, 855 F.2d 178,180 (4th Cir. 1988). If the common law right of
access to judicial records applies, there is a presumption of public access to judicial records, which
can only be rebutted if countervailing interests outweigh the public's interest in access. Rushford

v. New Yorker Magazine, Inc., 846 F.2d249, 253 (4th Cir. 1988). "Some ofthefactorsto be weighed
in the common law balancing test 'include whether the records are sought for improper purposes,
such as promoting public scandals or unfairly gaining a business advantage; whether release would
enhance the public's understanding of an important historic event; and whether the public already
had access to the information contained in the records."' Virginia Dep 't of State Police v.

Washington Post, 386 F.3d 567,575 (4th Cir. 2004)(quotingin re Knight Pub!. Co., 743 F.2d 231,
235 (4th Cir. 1984)). Where the First Amendment guarantees access to judicial records, such access
may be denied only on the basis of a compelling governmental interest or other higher value, and
only if the denial is narrowly tailored to serve that interest or value. See Stone, 855 F.2d at 180; see

also Haas v. Golding Transp., Inc., No. 1:09-CV-1016, 2010 WL 1257990, *7 n.4 (M.D.N.C.
March 26, 201 0) (substituting "higher value" for "governmental interest" in the context of a civil
case involving nongovernmental litigants).
In weighing the competing interests between the presumption of access and the asserted
reason for sealing, a court must comply with the procedure set forth by In re Knight Publishing

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Company. First, a court must give the public notice of a request to seal and a reasonable opportunity
to challenge it. 743 F.2d at 235. Although individual notice is not necessary, a court must notify
persons present in the courtroom of the request, or docket it "reasonably in advance of deciding the
issue." Id A court must consider less drastic alternatives to sealing, and if it decides to seal
documents, it must "state the reasons for its decision to seal supported by specific findings, and the
reasons for rejecting alternatives to sealing in order to provide an adequate record for review." Id
With respect to the pending motions to seal, the procedural requirements of In re Knight
Publishing Company have been satisfied. The motions were filed April 7, 2014 and April9, 2014,
respectively. No third parties or members of the press have attempted to file an objection to the
motion to seal. The parties' briefing suggests that only the common law right of access applies to
the documents at issue in the pending motions to seal, and the court has not located any authority to
the contrary. For the reasons stated in the court's November 12, 2013, Order [DE-56], the court
finds that the parties have demonstrated that there is a significant countervailing interest in support
of sealing that outweighs the public's right in access to the documents. Specifically, the Blue Sky
Defendants have shown that these documents contain information that could subject certain
individuals to physical harm and/or harassment. The court again finds that these individuals' interest
in their safety outweighs the public's interest in access to the relevant documents. See Dish Network
L.L. C. v. Sonicview USA, Inc., No. 09-CV -1553 L(NLS), 2009 WL 2224596, at *7 (S.D. Cal. July

23, 2009) (finding that protecting the identities of individuals who had served as confidential
informants, and thereby protecting them from being subjected to threats of physical harm,
outweighed the presumption of access to court records). Additionally, the court finds that redacting
the Big Sky Defendants' Memorandum in Support of the Motion to Stay and Memorandum in

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Opposition to the First Motion to Compel, while filing unredacted versions of the same under seal,
is narrowly-tailored to protect the individuals while also providing public access to most of the
substance of the document. The court also finds, however, that the other memoranda subject to this
order, along with the specified exhibits, cannot be redacted in any meaningful manner, and therefore
they may be sealed in their entirety.
Accordingly, the Motions to Seal [DE-126; DE-133] are ALLOWED. The Clerk of Court
is DIRECTED to maintain the following documents under SEAL:
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Memorandum in Opposition to Plaintiffs Motion to Compel [DE-122] and Exhibits
A [DE-122-1], B [DE-122-2], C [DE-122-3] and D [DE-122-4] thereto;
Memorandum in Opposition to Plaintiffs Second Motion to Compel [DE-124] and
Exhibit A thereto [DE-124-1];
Memorandum in Support ofMotion to Seal [DE-125];
Memorandum in Support of Defendants' Motion to Amend the Protective Order
[DE-128]Memorandum in Support of Plaintiffs' to Seal [DE-115] and Exhibits A
[DE-128-1] and B [DE-128-2] thereto;
Memorandum in Support ofDefendants' Motion to Stay [DE-130];
Memorandum in Support ofMotion to Seal [DE-132]
II. CORRECTION OF SCHEDULING ORDER

In an order filed on April 11, 2014, the court allowed Plaintiffs Consent Motion to Amend

Scheduling Order and Continue Trial [DE-113 ], and modified the Scheduling Order in several ways.
One provision in the Order, setting the dispositive motion deadline as July 15, 2014, is incorrect.
Accordingly, the court hereby ORDERS that all dispositive motions shall be filed no later than
November 30,2014. All other deadlines remain in effect.
SO ORDERED.

This the

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i!i day of April, 2014.
esC. Fox
enior United States District Judge

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