Mobileum Inc. v. Kibott SARL ( 2023 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 MOBILEUM INC., Case No. 23-cv-01413-HSG 8 Plaintiff, ORDER DENYING PLAINTIFF’S ADMINISTRATIVE MOTIONS TO 9 v. SEAL 10 KIBOTT SARL, et al., Re: Dkt. Nos. 2, 29 11 Defendants. 12 13 Pending before the Court are Plaintiff’s administrative motions to file under seal all 14 exhibits to and significant portions of its complaint in this recently closed case. Dkt. Nos. 2, 29. 15 For the reasons below, the Court DENIES the motions without prejudice. 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 The Court must “balance[] the competing interests of the public and the party who seeks to 7 keep certain judicial records secret. After considering these interests, if the court decides to seal 8 certain judicial records, it must base its decision on a compelling reason and articulate the factual 9 basis for its ruling, without relying on hypothesis or conjecture.” Id. Civil Local Rule 79-5 10 supplements the compelling reasons standard set forth in Kamakana: the party seeking to file a 11 document or portions of it under seal “must explore all reasonable alternatives to filing documents 12 under seal, minimize the number of documents filed under seal, and avoid wherever possible 13 sealing entire documents . . . .” Civil L.R. 79-5(a). The party must further explain the interests 14 that warrant sealing, the injury that will result if sealing is declined, and why a less restrictive 15 alternative to sealing is not sufficient. See Civil L.R. 79-5(c). 16 Records attached to nondispositive motions must meet the lower “good cause” standard of 17 Rule 26(c) of the Federal Rules of Civil Procedure, as such records “are often unrelated, or only 18 tangentially related, to the underlying cause of action.” See Kamakana, 447 F.3d at 1179–80 19 (quotations omitted). This requires a “particularized showing” that “specific prejudice or harm 20 will result” if the information is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 21 307 F.3d 1206, 1210–11 (9th Cir. 2002); see also Fed. R. Civ. P. 26(c). “Broad allegations of 22 harm, unsubstantiated by specific examples of articulated reasoning” will not suffice. Beckman 23 Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (quotation omitted). 24 II. DISCUSSION 25 Plaintiff filed their first administrative motion to seal portions of their complaint and all 26 associated exhibits upon initiating this action. Dkt. No. 2. They then filed a second (essentially 27 identical) motion to seal in conjunction with their motion for entry of default, which attached as 1 Because the complaint is the pleading on which this action is based and clearly more than 2 tangentially related to the underlying cause of action, the Court applies a “compelling reasons” 3 standard to the motion. See, e.g., Align Tech., Inc. v. SmileDirectClub, LLC, No. 23-CV-00023- 4 EMC, 2023 WL 1931849 at *1 (N.D. Cal. Feb. 9, 2023) (“[T]he Court agrees . . . that there must 5 be compelling reasons to seal any portion thereof because ‘a complaint is the foundation of a 6 lawsuit.’”); Space Data Corp. v. Alphabet Inc., No. 16-CV-03260-BLF, 2018 WL 10454862 (N.D. 7 Cal. Aug. 31, 2018); In re Google Inc. Gmail Litig., No. 13-MD-02430-LHK, 2013 WL 5366963 8 at *2 (N.D. Cal. Sept. 25, 2013). 9 Plaintiff Mobileum contends that compelling reasons exist to seal portions of the operative 10 complaint and the entirety of the four motions appended thereto because the material proposed to 11 be sealed (1) is confidential and proprietary under the parties’ Framework Services Agreement, (2) 12 could be used by competitors to undercut Mobileum in the marketplace, and (3) cannot be 13 protected through less restrictive means. See generally Dkt. Nos. 2, 29. 14 Though Plaintiff argues the proposed sealing is “minimal,” Dkt. No. 2 at 4, the Court finds 15 that an overly modest description. For example, Plaintiff’s proposed redactions in the “Factual 16 Allegations” portion of the complaint are significant enough to preclude any working 17 understanding of the contours of the dispute. See Dkt. No. 1 ¶¶ 10–62. The redactions of the 18 exhibits, meanwhile, are all-encompassing. While Plaintiff is certainly correct that “closely- 19 negotiated or consumer-specific terms” can be sealable in this circuit, and that compelling reasons 20 may exist to seal sensitive business information, Plaintiff has not articulated with any particularity 21 how the allegations at issue in the complaint (or the entirety of the appended exhibits) contain the 22 types of information properly susceptible to sealing. This is their burden. See Kamakana, 447 23 F.3d at 1178–79 (holding that in circumstances such as these, the party moving for sealing must 24 “articulate compelling reasons supported by specific factual findings that outweigh the general 25 history of access and the public policies favoring disclosure.”). That the parties designated 26 material as confidential is of course insufficient by itself to justify sealing a document. Civil L.R. 27 79-5(d)(1)(A). 1 particularly here, given that many of the allegations contained in the proposed redactions bear 2 || directly on the claims in this case and do not appear to the Court to be obviously commercially 3 sensitive. That said, the Court recognizes that sealing some information in the complaint and 4 || associated exhibits may be appropriate. It also recognizes that appropriate sealing will likely not 5 || unduly hamper the public’s understanding of these judicial proceedings now that the matter has 6 settled without the Court weighing in on the merits. See In re iPhone Application Litig., No. 11- 7 || MD-02250-LHK, 2013 WL 12335013, at *2 (N.D. Cal. Nov. 25, 2013) (“The public’s interest in 8 accessing these documents is even further diminished in light of the fact that the Court will not 9 have occasion to rule on [the motion at issue].”). Accordingly, while the Court denies Plaintiff’s 10 motions to seal, Dkt. Nos. 2, 29, it will do so without prejudice. 11 || 1. CONCLUSION 12 The Court DENIES Plaintiffs motions to seal, Dkt. Nos. 2, 29, and DIRECTS Plaintiff to 5 13 file on the docket either unredacted versions of Dkt. Nos. 2 and 29, or revised (as in more 14 || narrowly tailored and/or more robustly substantiated) motions to seal, by November 30, 2023. 3 15 IT IS SO ORDERED. 16 || Dated: 11/17/2023 Abaypwed 5 Mbt) 8 HAYWOOD S. GILLIAM, JR. United States District Judge 19 20 21 22 23 24 25 26 27 28