San Diego Detox, LLC v. Detox Center of San Diego LLC ( 2024 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 SAN DIEGO DETOX, LLC, Case No.: 3:22-cv-01145-RBM-DDL 12 Plaintiff, ORDER GRANTING IN PART AND 13 v. DENYING IN PART AMENDED MOTION TO SEAL 14 DETOX CENTER OF SAN DIEGO LLC, et al., 15 [Doc. 78] Defendants. 16 17 18 Currently pending before the Court is Plaintiff San Diego Detox’s Amended Motion 19 to Seal Pursuant to [77] Order Granting in Part and Denying in Part Motions to Seal [Docs. 20 51, 57, 63] (“Amended Motion to Seal”). (Doc. 78.) For the reasons discussed below, 21 Plaintiff’s Amended Motion to Seal is GRANTED IN PART and DENIED IN PART. 22 I. BACKGROUND 23 The Court incorporates its prior explanation of Plaintiff’s Motions to Seal 1, 2, and 24 3 and Plaintiff’s bases to request sealing of accompanying lodged documents. (Doc. 77.) 25 II. LEGAL STANDARD 26 “[T]he courts of this country recognize a general right to inspect and copy public 27 records and documents, including judicial records and documents.” Nixon v. Warner 28 Commc’ns, Inc., 435 U.S. 589, 597 (1978). “Unless a particular court record is one 1 ‘traditionally kept secret,’ a ‘strong presumption in favor of access’ is the starting point.” 2 Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (citing Foltz v. 3 State Farm Mut. Auto Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). “The presumption 4 of access is ‘based on the need for federal courts … to have a measure of accountability 5 and for the public to have confidence in the administration of justice.’” Ctr. for Auto Safety 6 v. Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016) (quoting United States v. 7 Amodeo, 71 F.3d 1044, 1048 (2d Cir. 1995)). 8 A party seeking to seal a judicial record bears the burden of overcoming the strong 9 presumption of public access. Foltz, 331 F.3d at 1135. The showing required to meet this 10 burden depends upon whether the documents to be sealed relate to a motion that is “more 11 than tangentially related to the merits of the case.” Ctr. for Auto Safety, 809 F.3d at 1102. 12 When the underlying motion is more than tangentially related to the merits, the 13 “compelling reasons” standard applies. Id. at 1096–98. When the underlying motion does 14 not surpass the tangential relevance threshold, the “good cause” standard applies. Id. 15 The “compelling reasons” standard applies to documents related to a motion for 16 summary judgment as well as a motion for preliminary injunction. Foltz, 331 F.3d at 1135– 17 36; Ctr. for Auto Safety, 809 F.3d at 1103; see also In re Midland Nat. Life Ins. Co. Annuity 18 Sales Pracs. Litig., 686 F.3d 1115, 1119–20 (9th Cir. 2012) (compelling reasons standard 19 applied to Daubert motion filed in connection with pending summary judgment motion). 20 The “compelling reasons” standard is generally satisfied if the moving party can show that 21 the “‘court files might have become a vehicle for improper purposes,’ such as the use of 22 records to gratify private spite, promote public scandal, circulate libelous statements, or 23 release trade secrets.” Kamakana, 447 F.3d at 1179 (quoting Nixon, 435 U.S. at 598). The 24 decision to seal documents is “one best left to the sound discretion of the trial court” upon 25 consideration of “the relevant facts and circumstances of the particular case.” Nixon, 435 26 U.S. at 599. 27 Compelling reasons may exist if sealing is required to prevent documents from being 28 used “as sources of business information that might harm a litigant’s competitive standing.” 1 Nixon, 435 U.S. at 598. “[A] trial court has broad discretion to permit sealing of court 2 documents for, inter alia, the protection of ‘a trade secret or other confidential research, 3 development, or commercial information.’” GPNE Corp. v. Apple Inc., No. 12-cv-2885- 4 LHK, 2015 WL 4381244, at *1 (N.D. Cal. July 16, 2015) (quoting Fed. R. Civ. P. 5 269(c)(1)(G)). Additionally, courts have been willing to seal court filings containing 6 confidential business material, “such as marketing strategies, product development plans, 7 licensing agreements, and profit, cost, and margin data,” where the “parties have been able 8 to point to concrete factual information” to justify sealing. Cohen v. Trump, No. 13-cv- 9 2519-GPC-WVG, 2016 WL 3036302, at *5 (S.D. Cal. May 27, 2016) (collecting cases); 10 see also In re Electronic Arts, 298 F. App’x 568, 569 (9th Cir. 2008) (finding compelling 11 reasons to seal “pricing terms, royalty rates, and guaranteed minimum payment terms”); 12 Quidel Corp. v. Siemens Med. Sols. USA, Inc., No. 16-CV-3059-BAS-AGS, 2020 WL 13 1062949, at *2 (S.D. Cal. Mar. 4, 2020) (applying compelling reasons standard to seal 14 plaintiff’s “confidential financial and pricing information”). Because Plaintiff’s sealing 15 motions concern their briefing on the cross-motions for summary judgment (Docs. 51, 57, 16 63), the compelling reasons standard applies. 17 III. DISCUSSION 18 The Court has reviewed Plaintiff’s Amended Motion to Seal and accompanying 19 lodged documents. (Docs. 78, 79.) In Plaintiff’s Amended Motion, it explains it is not 20 seeking to renew its request to seal (1) Doc. 52-5, SDD 217, (2) Doc. 52-8, Exhibit 8, and 21 (3) Doc. 50-5, Exhibit 21, and explains Exhibit 21 was included inadvertently. (Doc. 78 at 22 2.)1 Additionally, Plaintiff renews its request to seal (1) Doc. 52-10, Exhibit 22, (2) Doc. 23 52-10, Exhibit 23, (3) the unredacted version of Plaintiff’s MSJ, (4) the unredacted version 24 of Plaintiff’s Opposition to Defendants’ MSJ, and (5) the Unredacted Joint Statement of 25 Disputed and Undisputed Facts re Cross Motions for Summary Judgment. (Id. at 2–3.) 26 27 28 1 1 The Court addresses these documents below. 2 1. Exhibit 22 3 Plaintiff explains Exhibit 22 is “Defendant’s financial statement.” (Id. at 2.) The 4 Court has reviewed Exhibit 22 (Doc. 79 at 2–6) and determines there are compelling 5 reasons to seal Defendants’ financial statement. See Nixon, 435 U.S. at 598. 6 2. Exhibit 23 7 Plaintiff explains Exhibit 22 is “Plaintiff’s internal document which shows non- 8 public click-through and impression data by month of SanDiegoDetox.com for Google 9 AdWords, including its marketing expenses related thereto, and such internal metrics 10 performance and financial metrics are highly confidential and would give competitors 11 insight into Plaintiff’s budget and non-public strategies.” (Doc. 78 at 2.) The Court has 12 reviewed Exhibit 22 (Doc. 79 at 8) and determines there are compelling reasons to seal this 13 Google AdWords data. See Nixon, 435 U.S. at 598. 14 3. Unredacted Motion 15 The Court has reviewed the proposed redacted portions of Plaintiff’s MSJ. (Doc. 16 79-1.) The Court determines there are compelling reasons to seal the redacted portions 17 consistent with this Court’s prior order concerning Plaintiff’s Motions to Seal 1, 2 and 3 18 (Doc. 77) and the Court’s sealing Exhibits 22 and 23 above. However, the Court does not 19 find compelling reasons to seal redacted portions derived from Doc. 52-8, Exhibit 8, for 20 which Plaintiff is not renewing its sealing motion. 21 4. Unredacted Opposition 22 The Court has reviewed the proposed redacted portions of Plaintiff’s Opposition to 23 Defendant’s MSJ. (Doc. 79-2.) The Court determines there are compelling reasons to seal 24 the redacted portions consistent with this Court’s prior order concerning Plaintiff’s Motions 25 to Seal 1, 2 and 3 (Doc. 77) and the Court’s sealing Exhibits 22 and 23 above. However, 26 the Court does not find compelling reasons to redact any other citation not addressed in the 27 Court’s sealing orders. (See e.g., Doc. 79-2 at 24.) 28 /// 1 5. Unredacted Joint Statement 2 The Court has reviewed the Unredacted Joint Statement of Disputed and Undisputed 3 Facts re Cross Motions for Summary Judgment. (Doc. 79-3.) The Court determines there 4 are compelling reasons to seal the redacted portions consistent with this Court’s prior order 5 concerning Plaintiff’s Motions to Seal 1, 2 and 3 (Doc. 77) and the Court’s sealing Exhibits 6 22 and 23 above. 7 IV. CONCLUSION 8 For the reasons discussed above, Plaintiff’s Amended Motion to Seal (Doc. 78) is 9 GRANTED IN PART and DENIED IN PART. Plaintiff is ORDERED to publicly file 10 the following on the docket on or before May 10, 2024: 11 1. Doc. 52-5, SDD 217 and Doc. 52-8, Exhibit 8; and 12 2. Any proposed redacted portion of Plaintiff’s MSJ (Doc. 79-1) and Plaintiff’s 13 Opposition to Defendant’s MSJ (Doc. 79-2) inconsistent with the Court’s 14 opinion above and the Court’s prior sealing order (Doc. 77). 15 IT IS SO ORDERED. 16 DATE: May 8, 2024 17 _____________________________________ HON. RUTH BERMUDEZ MONTENEGRO 18 UNITED STATES DISTRICT JUDGE 19 20 21 22 23 24 25 26 27 28