Bunsow De Mory LLP v. North Forty Consulting LLC ( 2020 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BUNSOW DE MORY LLP, Case No. 20-cv-04997-JSC 8 Plaintiff, ORDER RE DEFENDANT’S 9 v. ADMINISTRATIVE MOTION TO FILE UNDER SEAL 10 NORTH FORTY CONSULTING LLC, Re: Dkt. No. 19 Defendant. 11 12 Before the Court is Defendant and Counterclaimant’s administrative motion to file under 13 seal portions of its answer, and the declaration of Darren Neilson, counsel for Defendant, in 14 support of Defendant’s administrative motion. (See Dkt. No. 19). 15 Defendant now seeks to file under seal excerpts of the answer that contain or reflect 16 confidential information and materials. Defendant alleges that its requests are narrowly tailored in 17 light of this Court’s previous order approving Plaintiff’s second administrative motion to file 18 under seal. (Dkt. No. 17). For the reasons set forth below, the Court GRANTS Defendant’s 19 administrative motion in part and DENIES Defendant’s administrative motion in part. 20 I. Legal Standard 21 There is a presumption of public access to judicial records and documents. Nixon v. 22 Warner Commc'ns, Inc., 435 U.S. 589, 597 (1978). Courts generally apply a “compelling 23 reasons” standard when considering motions to seal documents, recognizing that “a strong 24 presumption in favor of access is the starting point.” Kamakana v. City & Cty. of Honolulu, 447 25 F.3d 1172, 1178 (9th Cir. 2006) (internal quotations and citations omitted). 26 Civil Local Rule 79-5 supplements the “compelling reasons” standard. Exeltis USA Inc. v. 27 First Databank, Inc., Case No. 17-cv-04810-HSG, 2020 WL 2838812, at *1 (N.D. Cal. June 1, 1 “establishes that the document, or portions thereof is privileged or protectable as a trade secret or 2 otherwise entitled to protection under the law,” or “sealable.” N.D. Cal. Civ. L.R. 79-5(b). 3 Confidential business information in the form of “license agreements, financial terms, details of 4 confidential licensing negotiations, and business strategies” satisfies the “compelling reasons” 5 standard. Exeltis USA Inc., 2020 WL 2838812, at *1; see also In re Qualcomm Litig., No. 3:17- 6 cv-0108-GPC-MDD, 2017 WL 5176922, at *2 (S.D. Cal. Nov. 8, 2017) (observing that sealing is 7 warranted to prevent competitors from “gaining insight into the parties’ business model and 8 strategy”); Finisar Corp. v. Nistica, Inc., No. 13-cv-03345-BLF (JSC), 2015 WL 3988132, at *4-5 9 (N.D. Cal. June 30, 2015). 10 II. Administrative Motion to File Under Seal 11 Defendant seeks to seal paragraphs of the answer that concern the parties’ consulting 12 agreement. (Dkt. No. 19-4 at 10-13 ¶¶ 3-4, 14-19; 15-17 ¶¶ 36, 38, 42, 45, 49.) As with the 13 complaint, the answer’s explicit references to terms from the consulting agreement between 14 Plaintiff and Defendant reflect confidential business information and dealings between the parties 15 that are not intended for public disclosure, and therefore warrant sealing. See Finistar Corp., 2015 16 WL 3988132, at *4. Descriptions of how Defendant assisted Plaintiff in the Huawei litigation, 17 however, are undeserving of seal because they do not name any patent with sufficient specificity 18 to provide competitors with any advantage, nor do they provide any specific details regarding the 19 “technical and commercial discussions” with Huawei that reflect the parties’ business models, 20 strategy, or financial terms. (Dkt. No. 19-4 at 14 ¶ 25). See In re Qualcomm Litig., 2017 WL 21 5176922, at *2; Exeltis USA Inc., 2020 WL 2838812, at *1. 22 Similarly, the answer’s discussion of work Defendant performed for L3Harris 23 Technologies (“Harris”) during its negotiation with Acacia Research Corporation (“Acacia”) does 24 not warrant sealing because it simply summarizes Defendant’s conduct without reference to 25 how—if at all—this conduct was the result of confidential negotiations between Defendant and 26 Harris, see Exeltis USA Inc., 2020 WL 2838812, at *1, or what patents specifically had their 27 “value and viability” evidenced by the mentioned licensing discussions with Comcast Cable 1 31.) Mention in this paragraph of how Defendant provided claim charts and “illustrative financial 2 || and economic models,” as well as “Acacia requested communications between North Forty and 3 Comcast” does not make the requested redaction worthy of seal because this provides no insight 4 into specific terms of the licensing discussions, models, or communications that would harm the 5 || parties’ competitive standing. See In re Qualcomm Litig., 2017 WL 5176922, at *2. 6 However, reference to terms from the settlement Defendant and Harris negotiated with 7 || Comcast reflects confidential business information and warrants sealing. (Dkt. No. 19-4 at 15 4] 8 || 35.) The answer’s reference to the terms of Defendant’s license agreement with Landis+Gyr, as 9 || well as how this affected the parties’ relationship under the consulting agreement, concerns 10 || confidential licensing negotiations and financial terms that are deserving of seal. (Dkt. No. 19-4 at 11 16 9 44.) See Exeltis USA Inc., 2020 WL 2838812, at *1. 12 CONCLUSION 13 As set forth above, the Court GRANTS in part and DENIES in part Defendant’s 14 || administrative motion to file under seal. Defendant shall file an unredacted version of the answer 3 15 within seven days of this Order. 16 = 17 IT IS SO ORDERED. 18 Dated: October 19, 2020 19 I | q 20 me JACQUELINE SCOTT CORLE 21 United States Magistrate Judge 22 23 24 25 26 27 28