Blockchain Innovation, LLC v. Franklin Resources, Inc. ( 2022 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BLOCKCHAIN INNOVATION, LLC, Case No. 21-cv-08787-HSG 8 Plaintiff, ORDER DENYING ADMINISTRATIVE MOTION TO SEAL 9 v. Re: Dkt. No. 41, 60 10 FRANKLIN RESOURCES, INC., et al., 11 Defendants. 12 13 Pending before the Court are two administrative motion to consider whether another 14 party’s material should be sealed related to Defendants’ motions to dismiss. Dkt. Nos. 41, 60. 15 The Court DENIES the motions for the reasons below. 16 I. LEGAL STANDARD 17 Courts generally apply a “compelling reasons” standard when considering motions to seal 18 documents. Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 678 (9th Cir. 2010) (quoting Kamakana 19 v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)). “This standard derives from the 20 common law right ‘to inspect and copy public records and documents, including judicial records 21 and documents.’” Id. (quoting Kamakana, 447 F.3d at 1178). “[A] strong presumption in favor of 22 access is the starting point.” Kamakana, 447 F.3d at 1178 (quotations omitted). To overcome this 23 strong presumption, the party seeking to seal a judicial record attached to a dispositive motion 24 must “articulate compelling reasons supported by specific factual findings that outweigh the 25 general history of access and the public policies favoring disclosure, such as the public interest in 26 understanding the judicial process” and “significant public events.” Id. at 1178–79 (quotations 27 omitted). “In general, ‘compelling reasons’ sufficient to outweigh the public’s interest in 1 vehicle for improper purposes,’ such as the use of records to gratify private spite, promote public 2 scandal, circulate libelous statements, or release trade secrets.” Id. at 1179 (quoting Nixon v. 3 Warner Commc’ns, Inc., 435 U.S. 589, 598 (1978)). “The mere fact that the production of records 4 may lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will not, 5 without more, compel the court to seal its records.” Id. 6 Records attached to nondispositive motions must meet the lower “good cause” standard of 7 Rule 26(c) of the Federal Rules of Civil Procedure, as such records “are often unrelated, or only 8 tangentially related, to the underlying cause of action.” Id. at 1179–80 (quotations omitted). This 9 requires a “particularized showing” that “specific prejudice or harm will result” if the information 10 is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1210–11 (9th 11 Cir. 2002); see also Fed. R. Civ. P. 26(c). “Broad allegations of harm, unsubstantiated by specific 12 examples of articulated reasoning” will not suffice. Beckman Indus., Inc. v. Int’l Ins. Co., 966 13 F.2d 470, 476 (9th Cir. 1992) (quotation omitted). 14 II. DISCUSSION 15 As an initial matter, the motion to seal at Dkt. No. 41 is denied as moot; it is associated 16 with motions to dismiss that were terminated as moot in light of Plaintiff’s first amended 17 complaint, Dkt. No. 55. See Eli Lilly & Co. v. Genentech, Inc., No. 13-CV-0919 YGR, 2013 WL 18 4396718, at *1 (N.D. Cal. Aug. 13, 2013) (denying motion to seal documents related to motions 19 that the court denied as moot). Because the court did not reach these motions to dismiss, the Court 20 will not consider the associated documents and they will remain under seal. 21 The Court will instead address the administrative motion to seal at Dkt. No. 60 associated 22 with the motions to dismiss the first amended complaint. Because Defendants seek to seal 23 documents related to a dispositive motion, the Court applies the “compelling reasons” standard. 24 Defendants seek to file under seal portions of briefing in support of their motions to dismiss the 25 first amended complaint, portions of Exhibit 4 to the Declaration of Darryl M. Woo in support of 26 Defendants’ request for judicial notice, and Exhibit G to the Supplemental Declaration of Roger 27 Bayston in support of Defendants’ motions to dismiss. The documents include an asset purchase 1 the basis of Plaintiff’s claims. The motion seeks to seal the agreements in their entirety and redact 2 || portions of other filings that excerpt those agreements. 3 Defendants filed the motion to seal “to afford the designating parties the opportunity to 4 || defend the confidentiality of these documents,” and the only basis offered is that the documents 5 were designated as confidential. /d. at 2. The designating party did not file a declaration 6 || establishing that the documents are sealable within seven days of Defendant’s motion as required 7 under Civil Local Rule 79-5(f)(3). As Civil Local Rule 79-5(c) explains, “[rJeference to a 8 stipulation or protective order that allows a party to designate certain documents as confidential is 9 not sufficient to establish that a document, or portions thereof, are sealable.” 10 Because the motion to seal does not comply with Civil Local Rule 79-5 in light of the 11 designating party’s failure to respond, the Court finds no basis to seal the requested documents. | || I. CONCLUSION 13 The Court DENIES Dkt. No. 41 as moot. The court will not consider the associated 14 || documents, and the parties are excused from filing public versions of the documents provisionally 3 15 filed under seal in association with Dkt. No. 41. The Court DENIES Dkt. No. 60. The Court 16 || DIRECTS the parties to file public versions of all documents for which the proposed sealing has 3 17 been denied within seven days from the date of this order. IT IS SO ORDERED. 19 || Dated: 9/29/2022 20 Abpea 5 Mbt) HAYWOOD S. GILLIAM, JR. United States District Judge 22 23 24 25 26 27 28