Big Red Box LLC v. Square Inc et al

Filing 145

ORDER denying 144 motion for redaction of Plaintiff's Third Amended Complaint. Plaintiff is directed to file an unredacted copy of its Third Amended Complaint by September 9, 2019. Defendants deadline to file a responsive pleading is September 10, 2019. Signed by Magistrate Judge Shiva V. Hodges on 9/3/2019. (bgoo)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
Big Red Box LLC,
Plaintiff,
vs.
Square Inc.; William Tye Grisel;
Joe Grisel; and G5 Marketing
Solutions LLC,
Defendants.

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C/A No.: 3:18-758-JMC-SVH

ORDER

This matter comes before the court on the motion of Square, Inc.
(“Square”), to require Plaintiff to file a redacted version of its Third Amended
Complaint (“the Complaint”). [ECF No. 144]. Square argues that it seeks
limited redaction because the Complaint contains sensitive business
information, including trade secret information.
Specifically, Square argues the Complaint contains allegations that
disclose specific aspects of Square’s business operations, including various
methods it utilizes in managing and servicing merchant accounts, such as
security measures. Square argues the information could be exploited for
competitive harm and asserts it seeks only to redact information “it believes
is business sensitive because that very information could be used to
potentially abuse Square’s systems or by competitors in a manner
disadvantageous to Square.” [ECF No. 144 at 1–2].

In Nixon v. Warner Communications, Inc., 435 U.S. 589, 597 (1978),
the Supreme Court recognized a common law right to inspect and copy
judicial records and documents. However, the right of access to court records
is not absolute. In determining whether to limit public access to information
or documents in the court records, the court must apply a balancing test that
considers “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 historical
event; and whether the public has already had access to the information
contained in the records.” In re Knight Publishing Co., 743 F.2d 231, 235 (4th
Cir. 1984). There are “established exceptions to the presumption of public
access . . . where disclosure might reveal trade secrets.” Under Seal v. Under

Seal, 326 F.3d 479, 485–486 (4th Cir. 2003).
The parties have provided the court with an unredacted version of the
Complaint for in camera review. A review of the unredacted version reveals
the material Square seeks to redact includes: (1) portions of email
correspondence between Square and codefendant Grisel, a user of Square’s
services; (2) disclosure of laws Square must follow and requirements Square
has agreed to follow pursuant to agreements with credit card companies; (3)
specific requirements of users of Square’s services; and (4) specific signs of
potentially fraudulent activity allegedly displayed by Grisel as a user of
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Square’s services. The undersigned does not find that these allegations reveal
confidential trade secrets. Rather, they are allegations of examples of
Square’s alleged failure to comply with specific legal regulations or
obligations required by agreements with third parties in its relationship with
Grisel. Much of the information is publicly-available information about laws
and regulations with which Square must comply. Although Square argues
the redacted information contains confidential trade secrets or is sensitive
because it could be used to abuse Square systems or by competitors, it has
failed to demonstrate to the court the basis for this argument. To the extent
there are any confidential trade secrets included in the substantial
redactions, Square has failed to distinguish these from the more voluminous
redactions containing no trade secrets.
Therefore, after reviewing the information Square seeks to have
redacted and the reasons provided, and after balancing those interests with
the common law right to access court records, the undersigned denies
Square’s motion requiring redaction.
Plaintiff is directed to file an unredacted copy of its Third Amended
Complaint by September 9, 2019. As Defendants have had a copy of the
Third Amended Complaint since August 7, 2019, their deadline to file
responsive pleadings is September 10, 2019.

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IT IS SO ORDERED.

September 3, 2019
Columbia, South Carolina

Shiva V. Hodges
United States Magistrate Judge

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