Mission Wellness Pharmacy v. Wellpartner LLC ( 2022 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 Mission Wellness Pharmacy, ) N o. CV-22-00329-PHX-SPL ) 9 ) Petitioner, ) ORDER 10 vs. ) ) 11 ) Wellpartner LLC, ) 12 ) 13 Respondent. ) ) ) 14 15 Before the Court is Petitioner Mission Wellness Pharmacy’s (“Petitioner”) Motion 16 to File Petition Enforcing Arbitrator’s Hearing Subpoena Under Seal (Doc. 1) and 17 Memorandum in Support (Doc. 2) thereof. Petitioner requests that the Court: (i) grant the 18 Motion and order the sealing of Petitioner’s Petition to Enforce Arbitrator’s Hearing 19 Subpoena (currently lodged at Doc. 3) and (ii) order that all further filings in this case be 20 submitted under seal. For the following reasons, the Motion will be denied. 21 To overcome the “strong presumption in favor of [public] access,” a party seeking 22 to seal a judicial record must articulate justifications for sealing—that is, “compelling 23 reasons supported by specific factual findings”—that outweigh the public policies favoring 24 disclosure. See Kamakana v. City & Cnty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 25 2006); see also LRCiv. 5.6(b) (“Any motion or stipulation to file a document under seal 26 must set forth a clear statement of the facts and legal authority justifying the filing of the 27 document under seal.”). A court deciding to seal judicial records must “base its decision 28 on a compelling reason and articulate the factual basis for its ruling, without relying on 1 hypothesis or conjecture.” Kamakana, 447 F.3d at 1179 (quoting Hagestad v. Tragesser, 2 49 F.3d 1430, 1434 (9th Cir. 1995). “In general, ‘compelling reasons’ sufficient to 3 outweigh the public’s interest in disclosure and justify sealing court records exist when 4 such ‘court files might have become a vehicle for improper purposes,’ such as the use of 5 records to gratify private spite, promote public scandal, circulate libelous statements, or 6 release trade secrets.” Kamakana, 447 F.3d at 1179 (citing Nixon v. Warner Commc’ns, 7 Inc., 435 U.S. 589, 598 (1978)). “The mere fact that the production of records may lead to 8 a litigant’s embarrassment, incrimination, or exposure to future litigation will not, without 9 more, compel the court to seal its records.” Id. (citing Foltz v. State Farm Mut. Auto. Ins. 10 Co., 331 F.3d 1122, 1136 (9th Cir. 2003)). 11 This Court “generally will not enter an order that gives advance authorization to file 12 documents under seal that are designated for such treatment by parties under a protective 13 order or confidentiality agreement.” LRCiv. 5.6(b). Moreover, a party’s allegation that 14 certain documents are “confidential” or “business information” does not constitute a 15 compelling reason and is therefore insufficient to justify sealing court records containing 16 such documents. Krause v. Nev. Mut. Ins. Co., No. 2:13-cv-00976-APG-CWH, 2013 WL 17 3776416, at *5 (D. Nev. July 16, 2013) (citing Kamakana, 447 F.3d at 1179 and F.T.C. v. 18 AMG Servs., Inc., No. 2:12-cv-536-GMN-VCF, 2012 WL 3562027 (D. Nev. Aug. 15, 19 2012)); see also Kamakana, 447 F.3d at 1182 (finding that conclusory statements about 20 the content of documents—that they were confidential—did not rise to level of 21 “compelling reasons”). 22 Here, Petitioner asserts that a seal is necessary because the arbitral subpoena 23 Petitioner seeks to enforce contains references to or directly relates to “proprietary [and 24 sensitive confidential] information including contract agreements, payment and 25 remuneration data, and accounting [and financial] documents generated in connection with 26 those activities.” (Docs. 1 at 2 & 2 at 2–3). Petitioner provides no additional details nor 27 explanation. This Court finds that Petitioner’s position fails to meet the compelling reasons 28 standard because Petitioner has not articulated compelling reasons supported by specific 1 factual findings that outweigh the public’s right of access. Petitioner’s mere references to 2 “proprietary” and “sensitive confidential” information are insufficient to merit sealing the 3 Petition, let alone the entire case. “Thus, the Court finds no reason why the Motion and 4 exhibits (Doc. 1) or the Memorandum in Support [thereof] (Doc. 2) should not be made 5 publicly available in full, with only potentially sensitive information (none of which is 6 presently identifiable to the Court in the documents that are currently lodged) redacted.” 7 Mission Wellness Pharmacy v. Caremark N.J. Specialty Pharmacy LLC, No. CV-22- 8 00331-PHX-DJH, 2022 WL 657399, at *2 (D. Ariz. Mar. 4, 2022). 9 The Court also finds that Petitioner has failed to comply with the procedures 10 provided by Local Rule of Civil Procedure 5.6(d), including its obligation to confer with 11 Wellpartner LLC, prior to filing its Motion to Seal. That section states, 12 Unless otherwise ordered by the Court, if a party wishes to file a document that has been designated as confidential by another 13 party pursuant to a protective order or confidentiality agreement, or if a party wishes to refer in a memorandum or 14 other filing to information so designated by another party, the submitting party must confer with the designating party about 15 the need to file the document (or proposed filing) under seal and whether the parties can agree on a stipulation seeking to 16 have the document (or proposed filing) filed under seal. If the parties are unable to agree on these issues, the submitting party 17 must lodge the document (or proposed filing) under seal and file and serve a notice of lodging summarizing the parties’ 18 dispute and setting forth the submitting party's position, accompanied by a certification that the parties have conferred 19 in good faith and were unable to agree about whether the document (or proposed filing) should be filed under seal. 20 Within fourteen (14) days after service of the notice, the designating party must file and serve either a notice 21 withdrawing the confidentiality designation or a motion to seal and a supporting memorandum that sets forth the facts and 22 legal authority justifying the filing of the document (or proposed filing) under seal. If the designating party seeks to 23 have the document (or proposed filing) filed under seal, the motion must append (as a separate attachment) a proposed 24 order granting the motion to seal. No response to the motion may be filed. If the designating party does not file a motion or 25 notice as required by this subsection, the Court may enter an order making the document (or proposed filing) part of the 26 public record. 27 LRCiv. 5.6(d). 28 1 Accordingly, 2 IT IS ORDERED that the Motion to File Petition Enforcing Arbitrator’s Hearing 3 | Subpoena Under Seal (Doc. 1) is denied. Pursuant to LRCiv. 5.6(e), the lodged documents 4) (Doc. 3) will not be filed. Petitioner may—within five (5) days of this Order—resubmit 5 | their documents for filing in the public record, or, after conferring with Wellpartner LLC in good faith, file a notice of lodging in compliance with LRCiv. 5.6(d). 7 IT IS FURTHER ORDERED that the Clerk of Court shall unseal this case and all 8 | filed documents. 9 Dated this 29th day of March, 2022. 10 United States District Judge 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28