Ortega v. Chick-fil-A, Inc. ( 2022 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 | Ronald Ortega, No. 2:21-cv-00845-KJM-CKD 12 Plaintiff, ORDER 13 Vv. 14 Chick-fil-A, Inc., 1S Defendant. 16 17 Plaintiff Ronald Ortega brings this proposed class action against defendant Chick-fil-A, 18 | Inc. See generally First Am. Compl. (FAC), ECF No. 31. Ortega seeks to file an unredacted 19 | Second Amended Complaint (SAC), which, Chick-fil-A claims, contains “commercially sensitive 20 | and propriety information.” Req. to Seal at 1. Accordingly, Chick-fil-A requests the unredacted 21 | SAC be sealed. /d. Because Chick-fil-A has not shown compelling reasons for the unredacted 22 | SAC to be sealed, the request is denied (ECF No. 67). 23 “[T]he courts of this country recognize a general right to inspect and copy public records 24 | and documents, including judicial records and documents.” Nixon v. Warner Commce’ns, 435 25 | U.S. 589, 597 (1978) (footnotes omitted). Although that right is not absolute, “‘a strong 26 | presumption in favor of access’ is the starting point.” Kamakana v. City & Cty. of Honolulu, ' Because Ortega’s request to seal his opposition is predicated on the court’s granting Chick-fil-A’s request, see Notice of Req. to Seal, ECF No. 72, Ortega’s request is denied as moot. 1 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Foltz v. State Farm Mut. Auto. Ins. Co., 2 331 F.3d 1122, 1135 (9th Cir. 2003)). This presumption “is ‘based on the need for federal courts, 3 although independent—indeed, particularly because they are independent—to have a measure of 4 accountability and for the public to have confidence in the administration of justice.’” Ctr. for 5 Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016) (quoting United States v. 6 Amodeo, 71 F.3d 1044, 1048 (2d Cir. 1995)). 7 For these reasons, courts grant requests to seal records in civil cases in only limited 8 circumstances, such as to protect against “gratif[ication of] private spite or promot[ion of] public 9 scandal” or to preclude court dockets from being “reservoirs of libelous statements” or “sources 10 of business information that might harm a litigant’s competitive standing.” Nixon, 435 U.S. at 11 597 (citations omitted). When a party moves to seal a record, the court determines whether the 12 underlying filing is “more than tangentially related to the merits of a case.” Ctr. for Auto Safety, 13 809 F.3d at 1101. If so, then a party seeking to seal the record must satisfy the “stringent” 14 compelling-reasons standard. Id. at 1096. 15 Chick-fil-A asks to seal a complaint. “[A] request to seal all or part of a complaint must 16 clearly meet the ‘compelling reasons’ standard.” Mack v. Dearborn Nat’l Life Ins. Co., 17 No. 14-1665, 2014 WL 12572866, at *1 (E.D. Cal. Aug. 26, 2014) (citation omitted). Applying 18 this standard, “a court may seal records only when it finds ‘a compelling reason and articulate[s] 19 the factual basis for its ruling, without relying on hypothesis or conjecture,’” and “then 20 ‘conscientiously balance[s] the competing interests of the public and the party who seeks to keep 21 certain judicial records secret.’” Ctr. for Auto Safety, 809 F.3d at 1096−97 (first alteration in 22 original) (quoting Kamakana, 447 F.3d at 1179). The compelling-reasons standard applies even 23 if the contents were previously filed under seal or are covered by a generalized protective order. 24 See Foltz, 331 F.3d at 1136. 25 Chick-fil-A seeks to withhold two types of information from the public: “(1) sources of 26 confidential business information that if publicized could harm Chick-fil-A’s competitive 27 standing; and (2) internal business materials relating to its communications with franchisees, 28 employees, and customers about their personal experiences with the Chick-fil-A brand and 1 name.” Req. at 3. It explains that these citations are confidential under the Stipulated Protective 2 Order. Id. But, as explained below, Chick-fil-A does not provide compelling reasons to 3 overcome the “strong presumption in favor of access” for either type of information. Kamakana, 4 447 F.3d at 1178 (citation omitted). 5 First, Chick-fil-A seeks to prevent the disclosure of nine statements quoted from 6 documents produced in discovery. See Req. at 5–11. Each concerns Chick-fil-A’s alleged 7 business plan to improve delivery sales by increasing delivery menu prices while decreasing 8 delivery fees. They discuss the alleged plan, its benefits and drawbacks, and findings from 9 consumer research. In support of sealing, Chick-fil-A offers the same generalized argument for 10 each of the nine quotations: they reveal internal e-mail discussions about “consumer testing and 11 research findings,” which cost “considerable resources and time,” and as a result, their disclosure 12 would allow competitors to reap the rewards of Chick-fil-A’s investment. Req. at 5. Broad 13 claims that Chick-fil-A “expended considerable resources and time” and that competitors will 14 “reap” the benefits ring hollow. Id. The company’s plan to reduce delivery fees and increase 15 delivery menu prices is disclosed on the first page of the complaint. See FAC ¶¶ 2–6. Chick-fil- 16 A does not explain how these quotations reveal information other than that which is already 17 disclosed in the complaint. And although some of the quoted language justifies Chick-fil-A’s 18 plans, it is unclear how a competitor could profit from information and explanations attributed to 19 unnamed employees. The closest call is the first challenged quotation, which references 20 information on average check amounts taking account of price inflation as compared to 21 competitors’ prices. Req. at 5. But Chick-fil-A does not explain how any competitor could 22 unfairly reap the benefit of this information. 23 Second, Chick-fil-A seeks to seal four quotations from non-parties, including Chick-fil- 24 A’s employees, franchisees, and customers. See Req. at 11–13. Chick-fil-A claims that sealing 25 these quotations is necessary to preserve franchisees’ and customers’ privacy. That argument 26 would be more persuasive if the plaintiff had not already anonymized the quoted language. See 27 id. at 12–13 (referring to “Customer,” “CFA employee,” and bracketing “a different employee”). 1 Because the quoted language reveals no private or identifying information, Chick-fil-A has not 2 shown compelling reasons to seal. 3 The court denies Chick-fil-A’s request to seal. Ortega is directed to file the 4 unredacted Second Amended Complaint by October 7, 2022. 5 This order resolves ECF Nos. 67, 72. 6 IT IS SO ORDERED. 7 DATED: September 30, 2022.