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 GRANTING PLAINTIFF’S AMENDED ADMINISTRATIVE 9 v. MOTION TO SEAL 10 KIBOTT SARL, et al., Re: Dkt. No. 66 11 Defendants. 12 Pending before the Court is Plaintiff’s amended administrative motion to file under seal 13 portions of its complaint and related exhibits, and portions of two exhibits attached to Amal El 14 Bakha’s declaration in support of Plaintiff’s motion for entry of default against defendants. Dkt. 15 No. 66. For the reasons below, the Court GRANTS the motion. 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. The Court must “balance[] the competing 6 interests of the public and the party who seeks to keep certain judicial records secret. After 7 considering these interests, if the court decides to seal certain judicial records, it must base its 8 decision on a compelling reason and articulate the factual basis for its ruling, without relying on 9 hypothesis or conjecture.” Id. Civil Local Rule 79-5 supplements the compelling reasons 10 standard set forth in Kamakana: the party seeking to file a document or portions of it under seal 11 “must explore all reasonable alternatives to filing documents under seal, minimize the number of 12 documents filed under seal, and avoid wherever possible sealing entire documents . . . .” Civil 13 L.R. 79-5(a). The party must further explain the interests that warrant sealing, the injury that will 14 result if sealing is declined, and why a less restrictive alternative to sealing is not sufficient. See 15 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 this amended sealing motion to address the deficiencies identified by the 26 Court in is November 17, 2023 order denying Plaintiff’s motions to seal (a) portions of its 27 complaint and all of appended Exhibits A-D, Dkt. No. 2, and (b) portions of Exhibits 1 and 4 1 declaration, which was filed in support of Plaintiff’s request for entry of default against 2 defendants, Dkt. No. 29. Dkt. No. 65. The redactions proposed in those motions were broad, 3 covering large swaths of the complaint and the entirety of the associated exhibits. See id. Because 4 the Court found that Plaintiff had not demonstrated compelling reasons to maintain such sweeping 5 redactions of a fundamental case document like the complaint, it ordered Plaintiff to file either 6 unredacted versions of Dkt. Nos. 2 and 29 or “revised (as in more narrowly tailored and/or more 7 robustly substantiated) motions to seal.” Dkt. No. 65 at 4. Plaintiff opted for the latter, and timely 8 filed an amended motion to seal on November 30, 2023. Dkt. No. 66 (“Amended Mot.”). 9 Plaintiff’s amended motion still concerns the sealing of its operative complaint, associated 10 Exhibits A-D, and versions of the operative complaint in English (“Exhibit 1”) and French 11 (“Exhibit 4”) which Plaintiff filed in connection with its request for entry of default. See generally 12 Amended Mot. Given the nature of documents at issue, the Court applies the “compelling 13 reasons” standard to the motion since they clearly are more than tangentially related to the 14 underlying cause of action. See, e.g., Align Tech., Inc. v. SmileDirectClub, LLC, No. 23-CV- 15 00023- EMC, 2023 WL 1931849 at *1 (N.D. Cal. Feb. 9, 2023) (“[T]he Court agrees . . . that 16 there must be compelling reasons to seal any portion thereof because ‘a complaint is the 17 foundation of a lawsuit.’”); Space Data Corp. v. Alphabet Inc., No. 16-CV-03260-BLF, 2018 WL 18 10454862 (N.D. Cal. Aug. 31, 2018); In re Google Inc. Gmail Litig., No. 13-MD-02430-LHK, 19 2013 WL 5366963 at *2 (N.D. Cal. Sept. 25, 2013). 20 Plaintiff argues that it has now narrowly tailored its redactions to the Complaint, Exhibits 21 A-D, and Exhibit 1 to redact only information “that would harm the competitive standing of 22 Mobileum, including its confidential business information related to (1) the installation and 23 operation of its proprietary software platform, (2) the names of specific customers and end-users 24 for Mobileum’s proprietary software platform, and (3) customer-specific terms, all of which could 25 be used by other customers or competitors to harm Mobileum’s business interests.” Amended 26 Mot. at 5. It further argues that the harm engendered by publication of the redacted material “far 27 outweighs the interest of the public in learning Mobileum’s confidential business information at 1 The Court agrees, observing that Plaintiff significantly reduced its proposed redactions as 2 compared to its original request, and has narrowed these redactions to cover sensitive business 3 information instead of mundane factual allegations. The harm of revealing this information – 4 which arguably reflects “essential, closely-negotiated or consumer-specific terms” – is that it 5 “could be used by competitors to undercut the litigant or by potential customers to demand more 6 favorable terms in negotiations.” Sumotext Corp. v. Zoove, Inc., No. 16-cv-01370, 2020 WL 7 836737, at *3 (N.D. Cal. 2020). This harm is not outweighed by the public’s interest in 8 disclosure. Given that the parties resolved the dispute without the Court ever relying on the 9 documents at issue in any judicial proceeding or substantive ruling, the public’s interest in 10 complete disclosure of the complaint allegations and associated exhibits is reduced, since the 11 materials at issue do not aid the public’s understanding of judicial proceedings. See Hussain v. 12 Burger King Corp., No. 22-CV-02258-HSG, 2023 WL 2940032, at *2 (N.D. Cal. Mar. 15, 2023); 13 see also In re iPhone Application Litig., No. 11-MD-02250-LHK, 2013 WL 12335013, at *2 14 (N.D. Cal. Nov. 25, 2013). Unlike the prior iteration, then, Plaintiff’s currently proposed 15 redactions strike a balance between holding back commercially sensitive details that could harm 16 Plaintiff, while also providing the public with sufficient information to understand the contours of 17 this dispute. 18 Plaintiff additionally maintains that the public’s interest in disclosure of Exhibit 4 – the 19 French translation of the complaint – is so reduced that compelling reasons exist to seal it in its 20 entirety. Amended Mot. at 5. Because all of the information the public is entitled to see will be 21 disclosed in the English version of the complaint and Exhibits A-D, and because the Court never 22 considered the French translation (in part because the associated motion for entry of default was 23 withdrawn before this Court issued a decision), the Court agrees that compelling reasons exist to 24 seal this document in full. 25 Accordingly, the Court finds compelling reasons to GRANT Plaintiff’s request to seal the 26 following documents as proposed in the formats in which they have been provided to the Court: 27 // 1 Redactions Filing 2 1. Complaint In Paragraphs 17, 21, 23-24, 26-27, 29-31, 35-37, 41, 43-44, and 47 3 2. Exhibit A to the Complaint In Sections 3-4, 9-10, 12-15 and Attachment 4 3. Exhibit B to the Complaint In all Sections 5 4. Exhibit C to the Complaint 5. Exhibit D to the Complaint In Sections 1-6 and 8-9 6 6. Exhibit 1 to the Declaration of Amal El In Paragraphs 17, 21, 23-24, 26-27, 29-31, Bakhar in Support of Mobileum’s 35-37, 41, 43-44, and 47 7 Request for Entry of Default Against g Defendants Kibott SARL, Olaf Funke and Celine Dellis (“El Bakhar Decl.” 9 7. Exhibit 4 to the El Bakhar Decl. Entire Exhibit under seal 10 ll I. CONCLUSION a 12 The Court GRANTS Plaintiffs amended administrative motion to seal. IT IS SO ORDERED. 14 Dated: 12/7/2023 15 Alaywred § Sbl_|) 2 HAYWOOD S. GILLIAM, JR. a 16 United States District Judge = 17 6 Zz 18 19 20 21 22 23 24 25 26 27 28