Case: 21-1568 Document: 72 Page: 1 Filed: 02/09/2022
United States Court of Appeals
for the Federal Circuit
______________________
UNILOC USA, INC., UNILOC LUXEMBOURG S.A.,
Plaintiffs-Appellants
UNILOC 2017 LLC,
Plaintiff
v.
APPLE INC.,
Defendant-Appellee
ELECTRONIC FRONTIER FOUNDATION,
Intervenor-Appellee
______________________
2021-1568, 2021-1569, 2021-1570, 2021-1571, 2021-1573
______________________
Appeals from the United States District Court for the
Northern District of California in Nos. 3:18-cv-00358-
WHA, 3:18-cv-00360-WHA, 3:18-cv-00363-WHA, 3:18-cv-
00365-WHA, 3:18-cv-00572-WHA, Judge William H.
Alsup.
______________________
Decided: February 9, 2022
______________________
AARON JACOBS, Prince Lobel Tye LLP, Boston, MA, ar-
gued for plaintiffs-appellants. Also represented by JAMES
J. FOSTER.
Case: 21-1568 Document: 72 Page: 2 Filed: 02/09/2022
2 UNILOC USA, INC. v. APPLE INC.
DOUG J. WINNARD, Goldman Ismail Tomaselli Brennan
& Baum LLP, Chicago, IL, argued for defendant-appellee.
Also represented by ALAN ERNST LITTMANN, MICHAEL T.
PIEJA; CATHERINE CARROLL, DAVID P YIN, Wilmer Cutler
Pickering Hale and Dorr LLP, Washington, DC; MARK D.
SELWYN, THOMAS GREGORY SPRANKLING, Palo Alto, CA.
ALEXANDRA HELEN MOSS, Electronic Frontier Founda-
tion, San Francisco, CA, argued for intervenor-appellee.
Also represented by AARON DAVID MACKEY.
______________________
Before LOURIE, MAYER, and CUNNINGHAM, Circuit Judges.
Opinion for the court filed by Circuit Judge LOURIE.
Dissenting opinion filed by Circuit Judge MAYER.
LOURIE, Circuit Judge.
Uniloc USA, Inc., and Uniloc Luxembourg, S.A. (collec-
tively, “Uniloc”) appeal from a decision of the United States
District Court for the Northern District of California refus-
ing to seal certain documents in several related cases be-
tween Uniloc and Apple Inc. (“Apple”). See Uniloc USA,
Inc. v. Apple, Inc.,
508 F. Supp. 3d 550 (N.D. Cal. 2020)
(“Decision”). For the reasons provided below, we vacate
and remand.
BACKGROUND
This is Uniloc’s second appeal regarding the sealing of
documents. In its first appeal, Uniloc attempted to defend
requests to seal matters of public record, such as quota-
tions of this court’s opinions and a list of patent cases
Uniloc had filed. See Uniloc 2017 LLC v. Apple, Inc.,
964
F.3d 1351 (Fed. Cir. 2020). The district court correctly ap-
plied its local rules to reject these requests in their entirety
and to reject Uniloc’s request for reconsideration. This
Case: 21-1568 Document: 72 Page: 3 Filed: 02/09/2022
UNILOC USA, INC. v. APPLE INC. 3
court affirmed the district court’s rulings in nearly all re-
spects.
We also held, however, that the district court must con-
duct a more detailed analysis on whether confidential li-
censing information of certain third-party licensees of
Uniloc’s patents should be sealed.
Id. at 1363–64. As for
this subset of information, we remanded for the district
court to “make particularized determinations as to whether
and, if so, to what extent, the materials of each of these
parties should be made public.” Id. at 1364. The present
appeal is narrowly directed to this third-party licensing in-
formation.
One threshold issue raised by this court in its remand
order was whether Uniloc’s financier, Fortress Credit Co.
LLC (“Fortress”), should be considered a third party or a
Uniloc-related entity for purposes of sealing. Uniloc moved
to seal or redact third-party documents that revealed li-
censing terms, licensees’ names, amounts paid, and dates.
One document at issue was a Fortress investment memo-
randum that contained Fortress’s investment criteria and
other third-party licensing information. Apple did not op-
pose Uniloc’s motion. The Electronic Frontier Foundation
(“EFF”) moved to intervene to argue in favor of unsealing,
and the district court granted its motion.
The district court denied Uniloc’s motion. The court
explained that “[t]he public has every right to account
for . . . anyone holding even a slice of the public grant.” De-
cision at 554. It added that “patent licenses carry unique
considerations” that bolster the public’s right of access, in-
cluding the valuation of patent rights. Id. at 555. The
court further stated that “[t]he public has an interest in in-
specting the valuation of the patent rights” reflected in
Uniloc’s licenses. Id. It then suggested that disclosure of
patent licensing terms would facilitate “up-front cost eval-
uations of potentially infringing conduct,” “driv[e] license
values to a more accurate representation of the
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4 UNILOC USA, INC. v. APPLE INC.
technological value of the patent,” and help “inform reason-
able royalties in other courts.” Id.
The district court also determined that “the dates and
dollar amounts involved in Uniloc’s patent licenses go to
the heart of the primary dispute, that of Uniloc’s standing
(or lack of) to sue.” Id. (internal quotation marks omitted).
The court then ordered that the licensing information, in-
cluding the identity of the licensees, be unsealed in full.
With respect to the Fortress investment memorandum,
the district court found that Fortress did not comply with
Local Rule 79-5(e)(1) of the Northern District of California
because Uniloc filed a declaration in support of sealing, in-
stead of Fortress, as required by the rules. Id. On this
basis alone, the court denied Uniloc’s request to seal this
document.
Uniloc filed the present notice of appeal to this court.
We have jurisdiction pursuant to the collateral order doc-
trine. See Uniloc 2017, 964 F.3d at 1357–58.
DISCUSSION
This appeal involves the standard for sealing court rec-
ords, not substantive issues of patent law. Thus, Ninth
Circuit law applies. Uniloc 2017, 964 F.3d at 1357. “In the
Ninth Circuit, a district court’s decision to seal or unseal
court records is reviewed for abuse of discretion.” Id. “A
district court abuses its discretion if it bases its decision on
an erroneous legal standard or clearly erroneous findings
of fact.” Apple Inc. v. Samsung Elecs. Co.,
727 F.3d 1214,
1221 (Fed. Cir. 2013) (internal quotation marks omitted).
A district court also abuses its discretion if the reviewing
court “has a definite and firm conviction that the court be-
low committed a clear error of judgment in the conclusion
it reached upon a weighing of the relevant factors.”
Id.
Sealing may be appropriate to keep records from being
used “as sources of business information that might harm
a litigant’s competitive standing.” Nixon v. Warner
Case: 21-1568 Document: 72 Page: 5 Filed: 02/09/2022
UNILOC USA, INC. v. APPLE INC. 5
Commc’ns, Inc.,
435 U.S. 589, 598 (1978). In the Ninth Cir-
cuit, “compelling reasons” are needed to seal judicial rec-
ords related to a dispositive motion. Kamakana v. City &
Cnty. of Honolulu,
447 F.3d 1172, 1179 (9th Cir. 2006).
Such compelling reasons include preventing the release of
trade secrets.
Id.
Uniloc and Apple both argue that the district court
erred in failing to follow this court’s remand instructions to
make particularized determinations as to whether third-
party licensing information should be sealed. The parties
contend that the court erroneously applied heightened
scrutiny to requests to seal licensing information. Apple
adds that such information can rise to the level of a trade
secret, which is the type of information that the Ninth Cir-
cuit has deemed sealable. Uniloc cites various cases from
the district court and the Ninth Circuit sealing similar
types of information. See, e.g., Uniloc 2017 LLC v. Google
LLC,
508 F. Supp. 3d 556, 575 n.23 (N.D. Cal. 2020); In re
Elec. Arts, Inc., 298 F. App’x 568, 569 (9th Cir. 2009).
Intervenor EFF counters that denying Uniloc’s motion
was a sound use of the district court’s discretion. EFF adds
that the court conscientiously weighed Uniloc’s submis-
sions in support of sealing and concluded that they were
insufficient to overcome the public’s strong interest in ac-
cess.
We conclude that the district court failed to follow our
remand instructions to make particularized determina-
tions as to whether the third-party licensing information
sought to be sealed should be made public. That failure
was an abuse of discretion. The first time this case ap-
peared before us, “the district court failed to make findings
sufficient to allow us to adequately assess whether it
properly balanced the public’s right of access against the
interests of the third parties in shielding their financial
and licensing information from public view.” Uniloc 2017,
964 F.3d at 1364. We explained that “there is no indication
Case: 21-1568 Document: 72 Page: 6 Filed: 02/09/2022
6 UNILOC USA, INC. v. APPLE INC.
in the record that the court assessed whether any of the
third-party information was protectable as a trade secret
or otherwise entitled to protection under the law.” Id. (in-
ternal quotation marks omitted). We thus remanded and
instructed that the district court “make particularized de-
terminations as to whether and, if so, to what extent, the
materials of each of these parties should be made pub-
lic.” Id. Yet, on remand, the district court again neglected
to make sufficient findings. Nowhere in the record does the
district court discuss whether any of the third-party mate-
rials constitute protectable trade secrets. See Deci-
sion. For that reason, and because it is relevant to the
protectability of the license information, we remand for the
district court to carry out the examination this court in-
structed it to do.
We also disagree with the district court’s statements
purportedly supporting its decision concerning the public’s
right of access to information relating to patent licenses.
The court stated that “[t]he public has an interest in in-
specting the valuation of patent rights . . . particularly
given secrecy so often plays into the patentee’s advantage
in forcing bloated royalties.” Decision at 555. The court
thus made an error of law in making a blanket ruling that
the public has a broad right to licensing information relat-
ing to patents.
The public indeed does have an interest in patents, but
it is an interest in ensuring that patents are not procured
by fraud, or other improper means. See U.S. v. Glaxo Grp.
Ltd.,
410 U.S. 52, 57–58 (1973) (discussing the public in-
terest in free competition and ensuring that patents are not
obtained by fraudulent means). This is because patents are
to be granted only if they are valid, i.e., they describe and
claim inventions meeting the requirements of the law, in-
ventions that are novel, not obvious, and described in an
enabling manner.
Case: 21-1568 Document: 72 Page: 7 Filed: 02/09/2022
UNILOC USA, INC. v. APPLE INC. 7
The enforcement of patents is also imbued with the
public interest. Litigants and their counsel are subject to
Rule 11 of the Federal Rules of Civil Procedure, requiring
that parties presenting a case perform an “inquiry reason-
able under the circumstances” as to the legal and factual
merits of the claim, and they are subject to sanctions for an
exceptional case and for a frivolous appeal. Fed. R. Civ.
P. 11. Moreover, a patent can be held to be unenforceable
for inequitable conduct in its procurement. But no rule of
law or binding precedent says that the public is generally
entitled to know what consideration a patentee receives for
licensing its patent.
The district court stated that patents are granted in
derogation of the usual free flow of goods and ideas. It
stated colorfully that “a patent owner is a tenant on a plot
within the public realm of public knowledge, and a licensee
a subtenant.” Decision at 554. Those statements are in-
correct, as patents are granted for inventions that, until
their disclosure, did not constitute any flow of goods. Goods
claimed in a patent, if the patent is valid, did not previously
flow. Patents are granted for new inventions, those which
did not flow in commerce before the invention. A properly-
issued patent creates new land, keeping within the court’s
metaphor. It expands public knowledge.
The district court stated that the public has a strong
interest in knowing the full extent of the terms and condi-
tions involved in the exercise of its patent rights and in see-
ing the extent to which the patentee’s exercise of the
government grant affects commerce. But this is not an an-
titrust case or an FTC investigation involving unlawful re-
straint of trade or monopolization. It is a suit for patent
infringement. Absent an issue raised by the parties con-
cerning license rights and provisions, there is no public in-
terest or entitlement to information concerning
consideration for the grant of licenses. The parties are in
agreement that license information here should be sealed
and protected. The only differing voice has come from an
Case: 21-1568 Document: 72 Page: 8 Filed: 02/09/2022
8 UNILOC USA, INC. v. APPLE INC.
independent nonparty, appointed by the district court to
advocate unsealing the information that neither party
wished to unseal. But we have seen no citation of a rule of
law providing a presumption of access in a patent infringe-
ment suit to information concerning consideration for the
licensing of a patent.
An earlier issue in this case was a question of alleged
indiscriminate oversealing in patent and commercial cases
nationwide. For that reason, in the earlier appearance of
this case in our court, we affirmed-in-part the district
court’s refusal to seal all the requested information and re-
manded for the limited purpose of assessing whether third-
party licensing information should be sealed. But overseal-
ing was no longer the issue on remand.
The district court did note that a key issue in this case
was whether Uniloc had received at least $20 million in
royalties needed under licensing agreements to provide it
with standing to sue. But that fact can be proved without
opening up all the licenses that the court granted access to.
Lastly, for the Fortress investment memorandum, any
procedural failings of Uniloc and Fortress cannot justify
unsealing the information of third parties. The district
court should have considered whether the interests of the
implicated third parties outweigh the public’s interest in
seeing individual licensing details that are not necessary
for resolving this case.
We therefore vacate and remand for the district court
to comply with this court’s previous remand instructions.
CONCLUSION
We have considered EFF’s remaining arguments, but
we find them unpersuasive. Because the district court
failed to follow our previous remand instructions to make
particularized determinations as to whether third-party li-
censing information should be sealed, we vacate the court’s
denial and remand for the court to perform that analysis.
Case: 21-1568 Document: 72 Page: 9 Filed: 02/09/2022
UNILOC USA, INC. v. APPLE INC. 9
VACATED AND REMANDED
COSTS
No costs.
Case: 21-1568 Document: 72 Page: 10 Filed: 02/09/2022
United States Court of Appeals
for the Federal Circuit
______________________
UNILOC USA, INC., UNILOC LUXEMBOURG S.A.,
Plaintiffs-Appellants
UNILOC 2017 LLC,
Plaintiff
v.
APPLE INC.,
Defendant-Appellee
ELECTRONIC FRONTIER FOUNDATION,
Intervenor-Appellee
______________________
2021-1568, 2021-1569, 2021-1570, 2021-1571, 2021-1573
______________________
Appeals from the United States District Court for the
Northern District of California in Nos. 3:18-cv-00358-
WHA, 3:18-cv-00360-WHA, 3:18-cv-00363-WHA, 3:18-cv-
00365-WHA, 3:18-cv-00572-WHA, Judge William H.
Alsup.
______________________
MAYER, Circuit Judge, dissenting.
The district court adhered to our remand instructions
when it carefully weighed the public’s right of access to
court records against the interests of third-party patent li-
censees in shielding their licensing information from public
view. The court’s decision to deny the motion by Uniloc
Case: 21-1568 Document: 72 Page: 11 Filed: 02/09/2022
2 UNILOC USA, INC. v. APPLE INC.
USA, Inc., and Uniloc Luxembourg, S.A. (collectively,
“Uniloc”) to seal information related to its licenses with
third parties was a sound exercise of discretion given that
the dates and dollar amounts of those licenses went “to the
heart of the primary dispute” between Uniloc and Apple
Inc., which was whether Uniloc had generated sufficient li-
censing revenue to provide it with standing to sue. Uniloc
USA, Inc. v. Apple, Inc.,
508 F. Supp. 3d 550, 555 (N.D. Cal.
2020) (“District Court Decision”) (internal quotation marks
omitted). Uniloc’s third-party licensees, moreover, failed to
demonstrate a compelling interest in keeping their licens-
ing information confidential. See
id. at 554. I therefore
respectfully dissent.
The public’s right of access to documents filed in con-
nection with a dispositive pleading is sacrosanct. See
Kamakana v. City & Cnty. of Honolulu,
447 F.3d 1172,
1179 (9th Cir. 2006) (explaining that “the strong presump-
tion of access to judicial records applies fully to dispositive
pleadings, including motions for summary judgment and
related attachments,” given that “the resolution of a dis-
pute on the merits, whether by trial or summary judgment,
is at the heart of the interest in ensuring the public’s un-
derstanding of the judicial process and of significant public
events” (citations and internal quotation marks omitted));
see also DePuy Synthes Prods., Inc. v. Veterinary Orthope-
dic Implants, Inc.,
990 F.3d 1364, 1369 (Fed. Cir. 2021)
(stating that the “longstanding right” of access to judicial
records and documents “helps secure the integrity and
transparency of the judicial process”); In re Chiquita
Brands Int’l, Inc.,
965 F.3d 1238, 1242 (11th Cir. 2020) (“A
lawsuit is a public event. Parties who ask a court to resolve
a dispute must typically walk in the public eye.”); In re
Cendant Corp.,
260 F.3d 183, 192 (3d Cir. 2001) (explaining
that “[t]he public’s right of access extends beyond simply
the ability to attend open court proceedings” and includes
“a pervasive common law right to inspect and copy public
records and documents, including judicial records and
Case: 21-1568 Document: 72 Page: 12 Filed: 02/09/2022
UNILOC USA, INC. v. APPLE INC. 3
documents” (citations and internal quotation marks omit-
ted)). The right can be abridged only in certain narrow cir-
cumstances, and the party seeking to seal information
bears the burden of providing “sufficiently compelling rea-
sons for doing so.” Foltz v. State Farm Mut. Auto. Ins. Co.,
331 F.3d 1122, 1135 (9th Cir. 2003). While “[m]any a liti-
gant would prefer that the subject of [its] case . . . be kept
from the curious (including its business rivals and custom-
ers),” those who “call on the courts . . . must accept the
openness that goes with subsidized dispute resolution by
public (and publicly accountable) officials.” Union Oil Co.
v. Leavell,
220 F.3d 562, 567–68 (7th Cir. 2000).
What constitutes a compelling reason to seal docu-
ments is a determination “best left to the sound discretion
of the trial court.” Nixon v. Warner Commc’ns, Inc.,
435
U.S. 589, 599 (1978). Here, the district court did not abuse
its discretion in concluding that Uniloc’s third-party licen-
sees failed to make out a compelling case for shielding their
licensing information from public view. Notably, not a sin-
gle licensee directly filed a request with the district court
seeking to seal its licensing information. See District Court
Decision, 508 F. Supp. 3d at 554. Instead, when this case
was initially pending before the district court, “Uniloc so-
licited the views of all one hundred nine licensees regard-
ing the sealing of their patent license details.” Id. While
thirty-one licensees requested that all or part of their li-
censing information be kept confidential, only thirteen li-
censees submitted declarations in support of their
requests. See id.; J.A. 436–50, 805–37 (sealed third-party
declarations).
These declarations, by and large, are vague and conclu-
sory and fail to provide concrete evidence that the dissem-
ination of licensing information would cause the licensees
significant competitive injury in future licensing negotia-
tions or that the licensing information in question other-
wise qualifies as a trade secret. See J.A. 436–50, 805–37;
see also Total Recall Techs. v. Luckey, No. 21-15590, 2021
Case: 21-1568 Document: 72 Page: 13 Filed: 02/09/2022
4 UNILOC USA, INC. v. APPLE INC.
WL 5401664, at *1 (9th Cir. Nov. 18, 2021) (affirming a dis-
trict court’s order denying seven motions to seal where the
party seeking sealing failed to provide “specific” or “com-
pelling” evidence for doing so); DePuy, 990 F.3d at 1373 (af-
firming a district court order unsealing purportedly
confidential business information where the declarations
filed by the party seeking to prevent disclosure failed to ad-
dress how making the information public “would harm its
proprietary and competitive business interests” (citations
and internal quotation marks omitted)); Kamakana,
447
F.3d at 1182 (explaining that a party’s “conclusory”decla-
rations about the confidential nature of certain documents
did “not rise to the level of ‘compelling reasons’ sufficiently
specific to bar the public access to the documents”). Indeed,
only one of the publicly available declarations even uses
the term “trade secret” and that declaration broadly, and
without meaningful support, states that all the company’s
“financial records” qualify as trade secrets. J.A. 438. Im-
portantly, moreover, none of the declarations adequately
explain why redacting the names of the third-party licen-
sees—but fully disclosing the dates and dollar amounts of
their licenses with Uniloc—would not serve to eradicate
any even arguable concern regarding the disclosure of
trade secret information. See N.D. Cal. Civ. Local R. 79-
5(b) (2018) (emphasizing that any motion to seal “must be
narrowly tailored to seek sealing only of sealable material”
(emphasis added)).
The fact that other courts, under other circumstances,
have granted motions to seal patent licensing information
does not mean that the district court abused its discretion
in declining to do so here. This case involves the unusual
situation in which Uniloc, the party seeking the sealing or-
der, forfeited its right to keep its licensing information con-
fidential because its “original sealing request was grossly
excessive and its flouting of Local Rule 79-5 particularly
flagrant.” Uniloc 2017 LLC v. Apple, Inc.,
964 F.3d 1351,
1361 (Fed. Cir. 2020).
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UNILOC USA, INC. v. APPLE INC. 5
I disagree with this court’s conclusion that the district
court “made an error of law in making a blanket ruling that
the public has a broad right to licensing information relat-
ing to patents.” Ante at 6. The public presumptively has a
broad right of access to all information filed with a court in
connection with a dispositive motion, and this includes pa-
tent licensing information. See, e.g., Kamakana,
447 F.3d
at 1180 (explaining that “judicial records are public docu-
ments almost by definition, and the public is entitled to ac-
cess by default”).
“The political branches of government claim legitimacy
by election, judges by reason. Any step that withdraws an
element of the judicial process from public view makes the
ensuing decision look more like fiat, which requires com-
pelling justification.” Union Oil,
220 F.3d at 568. Because
the third-party licensees failed to supply compelling rea-
sons for overriding the strong presumption in favor of pub-
lic access, I would affirm.
