U.S. Tobacco Cooperative Inc. et al v. Big South Wholesale of Virginia, LLC d/b/a Big Sky International et al
ORDER granting 137 Motion to Seal; granting 141 Motion to Seal; granting in part and denying in part 146 Motion to Seal Document; granting 150 Motion to Seal; granting 153 Motion to Seal; granting 156 Motion to Seal; granting 160 Motion to Seal. Counsel is reminded to read the order in its entirety for detailed information. Signed by Senior Judge James C. Fox on 5/19/2014. (Edwards, S.)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
U.S. TOBACCO INC., U.S FLUECURED TOBACCO GROWERS, INC.,
and BIG SOUTH DISTRIBUTION, LLC,
BIG SOUTH WHOLESALE OF
VIRGINIA, LLC, d/b/a BIG SKY
INTERNATIONAL, BIG SOUTH
WHOLESALE, LLC, UNIVERSAL
SERVICES FIRST CONSULTING, alk/a
UNIVERSAL SERVICES CONSULTING
GROUP, JASON CARPENTER,
CHRISTOPHER SMALL, EMORY
STEPHEN DANIEL, and other unnamed
This matter is before the court on the motion to seal [DE-160] 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"), the motions to seal [DE-13 7;
DE-141; DE-150; DE-153; DE-156] filed by Plaintiffs U.S. Tobacco Inc., U.S. Flue-Cured Tobacco
Growers, Inc., and Big South Distribution, LLC, and the motion to seal [DE-146] filed by the United
States. For the reasons set forth below, the motions filed by Plaintiffs and Defendants are
ALLOWED, and the motion filed by the United States is DENIED without prejudice.
The United States seeks to file its motion to intervene and stay discovery and the supporting
memorandum of law under seal. In turn, the Big Sky Defendants seek to file under seal their
response to the Government's motion and their memorandum in support of their motion to seal.
Plaintiffs, for their part, seek to:
file under seal their memorandum in response to the Big Sky Defendants motion for
file under seal their reply in support of their motion for leave to file a second
amended complaint, along with exhibits A and B, and file a publicly-available
file under seal their response to the Big Sky Defendants' motion to stay and file a
publicly-available redacted copy of the same;
file under seal their response to the Big Sky Defendants' motion to amend the
protective order, along with exhibits A through D thereto;
file under seal their response to the Government's motion to intervene and stay
file under seal all the briefs in support of their motions to seal.
The Blue Sky Defendants and Plaintiffs consent to each others' respective motions.
The Fourth Circuit has directed that prior to sealing judicial records, a district court must first
determine the source ofthe 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 ofthe factors to 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) (quoting In 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, 2010) (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
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." !d. 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." !d.
The directives of the Fourth Circuit have been implemented in this court by virtue of Local Civil
Rule 79.2 and the Section T of the CMIECF Policy Manual.
In this case, the Government's motion to seal does not comply Local Civil Rule 79.2, or
Section T of the CM/ECF Policy Manual. Nevertheless, it is apparent from the substance of the
Government's memorandum in support of the underlying motion to intervene and stay discovery
that the Government is impliedly relying on Rule 6 ofthe Federal Rules of Criminal Procedure. At
this juncture, the court finds that the Government's interest in keeping grand jury proceedings secret
outweighs the public's interest in access to the documents, and the memorandum of law in support
of the motion to intervene cannot be meaningfully redacted. The Government's motion to seal [DE146] is therefore allowed as to the memorandum [DE-145]. The court does not discern, however,
that the motion to intervene itself presents any information implicating the concerns raised by Rule
6. The motion to seal [DE-146] is DENIED as to the motion to intervene [DE-144] itself.'
With respect to the pending motions to seal filed by Plaintiffs and the Big Sky Defendants,
the procedural requirements of In re Knight Publishing Company have been satisfied. The earliest
motion to seal was filed on April16, 2014, and the latest motion was filed May 13,2014. 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 parties have shown that the unredacted
versions ofthe documents, the specified exhibits to the briefs, along with the briefs in support of the
motion to seal, contain information that could subject certain individuals to physical harm and/or
Additionally, the Government is cautioned that any subsequent motions to seal that fail to comply
with Local Civil Rule 79.2 and Section T of the CM/ECF Policy Manual may be summarily denied.
harassment. The court again finds that these individual's 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 Plaintiffs' response to the
Big Sky Defendants' motion to stay and their reply in support of their motion for leave to file a
second amended complaint, while filing the unredacted versions of those documents under seal, is
narrowly-tailored to protect the individuals while also providing public access to most of the
substance of the documents. The court also finds, however, that the memoranda filed in support of
the motions to seal, the responses to the Government's motion to intervene, Plaintiff's response to
the motion to amend the protective order, along with the specified exhibits, cannot be redacted in
any meaningful manner, and therefore they may be sealed in their entirety.
Accordingly, the Plaintiffs' and Big Sky Defendants' Motions to Seal [DE-13 7; DE-141; DE150; DE-153; DE-156; DE-160] are ALLOWED, and the Government's Motion to Seal [DE-146]
is ALLOWED in part. The Clerk of Court is DIRECTED to maintain the following documents
Memorandum in Response to the Defendants' Motion for Protective Order [DE-13 5];
Memorandum in Support ofPlaintiffs' Motion to Seal [DE-136];
Reply to Defendants' Memoranda in Opposition to Plaintiffs' Motion for Leave to
Amend the Complaint [DE-139] and Exhibits A and B thereto [DE-139-1; DE-1392];
Memorandum in Support ofPlaintiffs' Motion to Seal [DE-140];
Memorandum in Support ofMotion to Intervene [DE-145]
Memorandum in Response to Motion to Stay [DE-148];
Memorandum in Support of Plaintiffs Motion to Seal [DE-149];
the entirety of Docket Entry 151 ;
Memorandum in Support of Plaintiffs' Motion to Seal [DE-152];
Memorandum in Response to the United States' Motion to Intervene [DE-154];
Memorandum in Support of Plaintiffs' Motion to Seal [DE-155];
the entirety ofDocket Entry 158;
Memorandum in Support ofMotion to Seal [DE-159].
The Government's Motion to Seal [DE-146] is DENIED with respect to the Motion to Intervene
This the .!1_ day of May, 2014.
nior United States District Judge
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