JOSHUA AREBALO, Case No. 5:19-cv-03034-EJD
Plaintiff, ORDER GRANTING IN PART AND DENYING IN PART v. ADMINISTRATIVE MOTIONS TO SEAL Defendant. Re: Dkt. Nos. 77, 80, 81, 89
In connection with Plaintiff Joshua Arebalo’s motion to set aside the settlement agreement (Dkt. No. 71) and Defendant Apple Inc.’s (“Apple”) motion to enforce the settlement agreement (Dkt. No. 85), Apple seeks to file portions of its briefs and supporting papers under seal. Dkt. Nos. 77, 80, 89. For the following reasons, the Court GRANTS IN PART and DENIES IN PART Apple’s motions to seal. “Historically, courts have recognized a ‘general right to inspect and copy public records and documents, including judicial records and documents.’” Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 597 & n.7 (1978)). Accordingly, when considering a sealing request, “a strong presumption in favor of access is the starting point.” Kamakana, 447 F.3d at 1178 (internal quotation marks omitted); see also Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003) (in considering whether documents should be sealed, courts “start with a strong presumption in favor of access to court records.”). Parties seeking to seal judicial records relating to motions that are “more than tangentially related to the underlying cause of action,” Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1099 (9th Cir. 2016), bear the burden of overcoming the presumption with “compelling reasons supported by specific factual findings that outweigh the general history of access and the public policies favoring disclosure.” Kamakana, 447 F.3d at 1178–79 (internal quotation marks and citation omitted). Records attached to motions that are “not related, or only tangentially related, to the merits of a case” are not subject to the strong presumption of access. Ctr. for Auto Safety, 809 F.3d at 1099; see also Kamakana, 447 F.3d at 1179 (“[T]he public has less of a need for access to court records attached only to non-dispositive motions because those documents are often unrelated, or only tangentially related, to the underlying cause of action.” (internal quotation marks and citation omitted)). Parties moving to seal records attached to motions unrelated or only tangentially related to the merits of a case must meet the lower “good cause” standard of Rule 26(c) of the Federal Rules of Civil Procedure. Ctr. for Auto Safety, 809 F.3d at 1098–99; Kamakana, 447 F.3d at 1179–80. The “good cause” standard requires a “particularized showing” that “specific prejudice or harm will result” if the information is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1210–11 (9th Cir. 2002) (citation omitted); see Fed. R. Civ. P. 26(c). “Broad allegations of harm, unsubstantiated by specific examples or articulated reasoning” will not suffice. Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (citation omitted). A motion to compel enforcement of settlement is only tangentially related to the merits of the underlying cause of action, and therefore it constitutes a non-dispositive motion. See NetApp, Inc. v. Nimble Storage, Inc., No. 5:13-cv-05058-LHK, 2015 WL 5569420, at *1 (N.D. Cal. Sept. 22, 2015) (finding motion to enforce settlement agreement non-dispositive and therefore applying the good cause standard to motion to seal). Accordingly, “[c]ourts apply the good cause standard to requests to seal information filed in conjunction with a motion to enforce a settlement agreement . . .” Dodocase VR, Inc. v. MerchSource, LLC, No.17-cv-07088-EDL, 2018 WL 5619799, at *1 n.1 (N.D. Cal. May 22, 2018); NetApp, 2015 WL 5569420, at *1 (same). The good cause showing, however, must be “particularized.” Kamakana, 447 F.3d at 1179. Pursuant to Rule 26(c), a trial court has broad discretion to permit sealing of court documents for, inter alia, the protection of “a trade secret or other confidential research, development, or commercial information.” Fed. R. Civ. P. 26(c)(1)(G). The Ninth Circuit has adopted the definition of “trade secrets” set forth in the Restatement of Torts, holding that “[a] trade secret may consist of any formula, pattern, device or compilation of information which is used in one’s business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it.” Clark v. Bunker, 453 F.2d 1006, 1009 (9th Cir. 1972) (quoting Restatement (First) of Torts § 757 cmt. b). “Generally [a trade secret] relates to the production of goods . . . . It may, however, relate to the sale of goods or to other operations in the business . . . .” Id. (alterations in original). Furthermore, the U.S. Supreme Court has recognized that sealing may be justified to prevent judicial documents from being used “as sources of business information that might harm a litigant’s competitive standing.” Nixon, 435 U.S. at 598. In addition, parties moving to seal documents must comply with the procedures established by Civil Local Rule 79-5. Pursuant to that rule, a sealing order is appropriate only upon a request that establishes the document is “sealable,” or “privileged, protectable as a trade secret or otherwise entitled to protection under the law.” Civ. L.R. 79-5(b). “The request must be narrowly tailored to seek sealing only of sealable material, and must conform with Civil [Local Rule] 79- 5(d).” Id. Civil Local Rule 79-5(d), moreover, requires the submitting party to attach a “proposed order that is narrowly tailored to seal only the sealable material” and that “lists in table format each document or portion thereof that is sought to be sealed,” as well as an “unredacted version of the document” that “indicate[s], by highlighting or other clear method, the portions of the document that have been omitted from the redacted version.” Civ. L.R. 79-5(d)(1). Apple seeks to seal portions of its opposition brief to Arebalo’s motion to set aside the settlement agreement, its motion to enforce the settlement agreement, and its reply in support of its motion to enforce, as well as portions of supporting declarations and exhibits. Dkt. Nos. 77, 80, 89. Apple argues that this information should be maintained under seal because it quoting or referencing terms from the parties’ confidential settlement agreement and settlement communications/negotiations. See, e.g., Dkt. No. 77 at 2–3. Courts in this district have recognized the general policy of protecting settlement negotiations and communications in order to promote settlement and have concluded that this policy satisfies the more demanding “compelling reasons” standard to seal judicial records. Milliner v. Mut. Securities, Inc., No. 15-CV-03354-DMR, 2021 WL 2645794, at *5 (N.D. Cal. June 28, 2021) (listing cases). However, Civil Local Rule 79-5 requires that a sealing request be narrowly tailored to seal only truly sealable material. Apple does not provide a sufficient particularized justification for sealing all the portions requested. As to the settlement agreement itself, the only terms truly relevant to the parties’ motions
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JOSHUA AREBALO, Case No. 5:19-cv-03034-EJD
Plaintiff, ORDER GRANTING IN PART AND DENYING IN PART v. ADMINISTRATIVE MOTIONS TO SEAL Defendant. Re: Dkt. Nos. 77, 80, 81, 89
In connection with Plaintiff Joshua Arebalo’s motion to set aside the settlement agreement (Dkt. No. 71) and Defendant Apple Inc.’s (“Apple”) motion to enforce the settlement agreement (Dkt. No. 85), Apple seeks to file portions of its briefs and supporting papers under seal. Dkt. Nos. 77, 80, 89. For the following reasons, the Court GRANTS IN PART and DENIES IN PART Apple’s motions to seal. “Historically, courts have recognized a ‘general right to inspect and copy public records and documents, including judicial records and documents.’” Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc’ns, Inc., 435 U.S. 589, 597 & n.7 (1978)). Accordingly, when considering a sealing request, “a strong presumption in favor of access is the starting point.” Kamakana, 447 F.3d at 1178 (internal quotation marks omitted); see also Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003) (in considering whether documents should be sealed, courts “start with a strong presumption in favor of access to court records.”). Parties seeking to seal judicial records relating to motions that are “more than tangentially related to the underlying cause of action,” Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1099 (9th Cir. 2016), bear the burden of overcoming the presumption with “compelling reasons supported by specific factual findings that outweigh the general history of access and the public policies favoring disclosure.” Kamakana, 447 F.3d at 1178–79 (internal quotation marks and citation omitted). Records attached to motions that are “not related, or only tangentially related, to the merits of a case” are not subject to the strong presumption of access. Ctr. for Auto Safety, 809 F.3d at 1099; see also Kamakana, 447 F.3d at 1179 (“[T]he public has less of a need for access to court records attached only to non-dispositive motions because those documents are often unrelated, or only tangentially related, to the underlying cause of action.” (internal quotation marks and citation omitted)). Parties moving to seal records attached to motions unrelated or only tangentially related to the merits of a case must meet the lower “good cause” standard of Rule 26(c) of the Federal Rules of Civil Procedure. Ctr. for Auto Safety, 809 F.3d at 1098–99; Kamakana, 447 F.3d at 1179–80. The “good cause” standard requires a “particularized showing” that “specific prejudice or harm will result” if the information is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1210–11 (9th Cir. 2002) (citation omitted); see Fed. R. Civ. P. 26(c). “Broad allegations of harm, unsubstantiated by specific examples or articulated reasoning” will not suffice. Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (citation omitted). A motion to compel enforcement of settlement is only tangentially related to the merits of the underlying cause of action, and therefore it constitutes a non-dispositive motion. See NetApp, Inc. v. Nimble Storage, Inc., No. 5:13-cv-05058-LHK, 2015 WL 5569420, at *1 (N.D. Cal. Sept. 22, 2015) (finding motion to enforce settlement agreement non-dispositive and therefore applying the good cause standard to motion to seal). Accordingly, “[c]ourts apply the good cause standard to requests to seal information filed in conjunction with a motion to enforce a settlement agreement . . .” Dodocase VR, Inc. v. MerchSource, LLC, No.17-cv-07088-EDL, 2018 WL 5619799, at *1 n.1 (N.D. Cal. May 22, 2018); NetApp, 2015 WL 5569420, at *1 (same). The good cause showing, however, must be “particularized.” Kamakana, 447 F.3d at 1179. Pursuant to Rule 26(c), a trial court has broad discretion to permit sealing of court documents for, inter alia, the protection of “a trade secret or other confidential research, development, or commercial information.” Fed. R. Civ. P. 26(c)(1)(G). The Ninth Circuit has adopted the definition of “trade secrets” set forth in the Restatement of Torts, holding that “[a] trade secret may consist of any formula, pattern, device or compilation of information which is used in one’s business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it.” Clark v. Bunker, 453 F.2d 1006, 1009 (9th Cir. 1972) (quoting Restatement (First) of Torts § 757 cmt. b). “Generally [a trade secret] relates to the production of goods . . . . It may, however, relate to the sale of goods or to other operations in the business . . . .” Id. (alterations in original). Furthermore, the U.S. Supreme Court has recognized that sealing may be justified to prevent judicial documents from being used “as sources of business information that might harm a litigant’s competitive standing.” Nixon, 435 U.S. at 598. In addition, parties moving to seal documents must comply with the procedures established by Civil Local Rule 79-5. Pursuant to that rule, a sealing order is appropriate only upon a request that establishes the document is “sealable,” or “privileged, protectable as a trade secret or otherwise entitled to protection under the law.” Civ. L.R. 79-5(b). “The request must be narrowly tailored to seek sealing only of sealable material, and must conform with Civil [Local Rule] 79- 5(d).” Id. Civil Local Rule 79-5(d), moreover, requires the submitting party to attach a “proposed order that is narrowly tailored to seal only the sealable material” and that “lists in table format each document or portion thereof that is sought to be sealed,” as well as an “unredacted version of the document” that “indicate[s], by highlighting or other clear method, the portions of the document that have been omitted from the redacted version.” Civ. L.R. 79-5(d)(1). Apple seeks to seal portions of its opposition brief to Arebalo’s motion to set aside the settlement agreement, its motion to enforce the settlement agreement, and its reply in support of its motion to enforce, as well as portions of supporting declarations and exhibits. Dkt. Nos. 77, 80, 89. Apple argues that this information should be maintained under seal because it quoting or referencing terms from the parties’ confidential settlement agreement and settlement communications/negotiations. See, e.g., Dkt. No. 77 at 2–3. Courts in this district have recognized the general policy of protecting settlement negotiations and communications in order to promote settlement and have concluded that this policy satisfies the more demanding “compelling reasons” standard to seal judicial records. Milliner v. Mut. Securities, Inc., No. 15-CV-03354-DMR, 2021 WL 2645794, at *5 (N.D. Cal. June 28, 2021) (listing cases). However, Civil Local Rule 79-5 requires that a sealing request be narrowly tailored to seal only truly sealable material. Apple does not provide a sufficient particularized justification for sealing all the portions requested. As to the settlement agreement itself, the only terms truly relevant to the parties’ motions are the production provision and the integration clause. Another Court in this district has denied requests to seal a very similar discovery obligation provision in a settlement agreement and discussions about those obligations. United States ex rel. Lesnik v. Eisenmann SE, No. 16-CV- 01120-LHK, 2021 WL 2092944 (N.D. Cal. May 11, 2021). Apple has not demonstrated how the production provision or the integration clause reveal any sensitive or confidential information. “[T]he public’s understanding of the motion[s] and the Court’s ruling require[] disclosure” of those specific terms. Id. at *3. Accordingly, the Court finds that no good cause exists to seal the production provision1 or the integration clause. However, the public has a minimal interest in knowing the terms of the settlement agreement that are not the focus of the parties’ motions and the Court’s ruling. Id. Balancing the public and private interest, the Court finds that good cause exists to seal the remainder of the settlement agreement. As to the parties’ settlement communications, the Court first observes that Apple did not
1 The Court finds it appropriate to seal information reflecting the amount of the production provision’s penalty fee. seek to seal portions of Arebalo’s briefs that quote or otherwise refer to the parties’ communications. Accordingly, any communications quoted or referred to in Arebalo’s briefs have already been publicly revealed. See, e.g., Dkt. No. 78 at 2 (quoting from April 30, 2021 email from defense counsel to Arebalo). As to the remainder of the communications, the Court finds it appropriate to seal only the proposed settlement terms and actual negotiations concerning those terms, with the exception of the production provision and integration clause as described above. In re Volkswagen “Clean Diesel” Mktg., Sales Pracs., & Prod. Liab. Litig., No. 2672 CRB (JSC), 2020 WL 2425792, at *4 (N.D. Cal. May 12, 2020) (granting motions to seal to the extent they seek to seal proposed settlement terms and actual settlement negotiations and denied in all other respects). The parties’ emails must be redacted to conceal only the proposed settlement’s terms and any actual negotiations on those terms. The Court finds that Apple’s proposed redactions are not narrowly tailored. Apple seeks to seal broad swaths of text (amounting to over half of Apple’s briefs) consisting of information that merely reflects the general nature of all settlement agreements or that does not reflect clearly confidential information, such as the mediator’s name, when mediation occurred, or the dates of certain communications or events. Apple also seeks to seal information that the parties already revealed in publicly filed documents. Compare, e.g., Dkt. No. 80-1 at 1 and 5 (seeking to seal date of agreement execution and information described in the declaration of Bob Ulrey) with Dkt. No. 80-8 (Ulrey declaration filed with no redactions) and Dkt. No. 80-1 ¶ 3 (revealing date of execution in publicly filed declaration). Apple provides no specific justification for sealing this information. See Bunsow De Mory LLP v. N. Forty Consulting LLC, 20-CV-04997-JSC, 2020 WL 7872197, at *2 (N.D. Cal. Aug. 7, 2020) (“Just because a provision is in an agreement that the parties designated as confidential does not make that provision sealable when the parties litigate that agreement in federal court.”). Additionally, Apple’s requests do not match its proposed redactions, forcing the Court to expend far more time and resources than should be necessary to resolve the sealing motions. Compare, e.g., Dkt. No. 80-11 (proposed order requesting to seal portions of pages 3–7, 8, 9–11) with Dkt. No. 80-3 (proposed redactions for motion to enforce settlement on pages i, 1, 2, 3–6, 7–9). Nor did Apple’s request to redact its reply in support of its motion to enforce settlement highlight the portions sought to be redacted. See Dkt. No. 89-4. This marks at least the second time Apple has failed to comply with Civil Local Rule 79-5. See Dkt. No. 76. For the foregoing reasons, the Court GRANTS IN PART and DENIES IN PART Apple’s motions to seal as follows: Document Portion Sought to be Sealed Court’s Ruling Apple’s Opposition to Page 2: lines 24-27, 28 Denied Plaintiff’s Motion to Set Aside Settlement Page 3: lines 1-2, 4-6, 7-8, 9, Granted only as to the penalty fee and Vacate Order to 10, 11-13, 14-17 amount, the 6th word of line 13, and Temporarily Stay the 4th word of line 16 Matter (Dkt. No. 73) Declaration of Scott P. Entire document Granted Jang in Support of Defendant’s Opposition to Plaintiff’s Motion to Set Aside Settlement and Vacate Order to Temporarily Stay Matter (Dkt. No. 73-1) Apple’s Motion to Page i: lines 8-14 Granted only as words 4-5 of line 14 Enforce Settlement (Heading II.C.2) (Dkt. No. 85) Page 1: lines 5-9, 22 Granted only as to words 10-13 of line 5 and word 1 of line 6 Page 2: lines 2-7, 15-28 Granted only as to the proposal amount on line 5; words 16-19 of line 18; words 1-5 of line 19; offer amount on line 24; quoted text on line 2; quoted text on line 26, and quoted text on line 27 Page 3: lines 1-28 Granted only as to the quoted text on lines 2-3; the offer amount on line 4; words 14-15 of line 7; words 3-4 of line 8, words 2-4 of line 9; offer amount on line 10; item (1) on lines 11-12; offer amount on line 15; penalty fee amount on line 17; penalty fee amount on line 18; words 12-14 of line 21; line 22; offer amount on line 23; words 7-12 of line 25; offer and penalty fee amounts and words 7-11 of line 26 Page 4: lines 1-26 Granted only as to line 2; offer amount on line 3; offer amount on line 8; words 1-5 of line 9; words 4-6 of line 10; words 6-13 of line 11; words 9-16 of line 18; amount on line 19; words 10-20 of line 20; words 1- 13 of line 21; penalty fee amount and words 1-2 of line 26 Page 5: lines 1-14, 16-28 Granted only as to words 2-5 of line 16; last word of line 18; lines 19-25; words 6-14 of line 27; line 28 Page 6: lines 1-3, 17-23 Granted only as to line 1; first word and last 4 words of line 2; last word of line 22; line 23 Page 7: lines 25-28 Granted only as to settlement amount and words 6-11 of line 25 Page 8: lines 1-6, 10-28 Granted only as to penalty fee amount on line 4; lines 10-13 Page 9: lines 1-10, 19-26 Denied Declaration of Scott P. Page 1: lines 8, 10-16, 18-21, Granted only as to proposal amount Jang in Support of 23-24, 26-28 and words 8-12 of line 11; line 16; Apple’s Motion to offer amount on line 20; quoted text Enforce Settlement on line 21; quoted text on lines 23 and 24 Page 2: lines 1, 3-7, 10, Granted only as to quoted text on line 11014, 16-18, 19-21, 14-27 1; offer amount on line 3; words 12- 13 and 17 on line 6; words 1-2 and 9- 12 of line 7; offer amount on line 9; item (1) on lines 11-13; offer amount on line 12; penalty fee amount on line 18; penalty fee amount on line 19; words 8-15 of line 23; words 1-10 of line 24; offer amount on line 25; words 1-6 of line 27 Page 3: lines 1-2, 4-7, 9-11, Granted only as to settlement amount 15-16, 18-20, 22-26 and words 9-11 of line 1; penalty fee and words 1-3 of line 2; words 4-6 of line 6; settlement amount and words 1-3 of line 7; settlement amounts and words 7-8 of line 15; words 6-10 of line 16; words 7-10 of line 18; words 1-7 of line 20 Page 4: lines 1-9, 10, 12-15, Granted only as to settlement amount 17-22, 25-27 and words 6-13 of line 2; words 16-19 of line 3; line 4; words 1-3 of line 5; penalty fee amount and words 11-12 of line 8; words 12-14 of line 13; line 14; words 1-4 of line 15; lines 17-22; words 7-11 of line 25; line 26; words 2-5 of line 27 Page 5: lines 1-4 Granted only as to lines 1-2; words 8- 11 of line 3 Ex. 1: entire document Granted only as to words 17-24 of sentence 8 of email body Ex. 2: entire document Granted in part subject to resubmission Ex. 3: entire document Granted in part subject to resubmission Ex. 4: entire document Granted in part subject to resubmission Ex. 5: entire document Granted in part subject to resubmission Ex. 6: entire document Granted in part subject to resubmission Ex. 7: entire document Granted in part subject to resubmission Ex. 8: entire document Granted in part subject to resubmission Ex. 9: entire document Denied except as to total amount Ex. 10: entire document Granted in part subject to resubmission Ex. 11: entire document Granted in part subject to resubmission Ex. 12: entire document Granted in part subject to resubmission Ex. 13: entire document Granted in part subject to resubmission Ex. 14: entire document Granted only as to the email attachment Ex. 15: entire document Granted in part subject to resubmission Ex. 16: entire document Granted in part subject to resubmission Ex. 17: entire document Granted in part subject to resubmission Ex. 18: entire document Ex. 19: entire document 2 Ex. 20: entire document Ex. 21: entire document 3 Ex. 22: entire document 4 Apple’s Reply to Page 1: lines 25-28 Granted only as to words 8-12 of line Plaintiffs Opposition 26 5 to Defendant’s Motion | Page 2: lines 1, 4-6, 7, 23-28 | Granted only as to bolded and to Enforce Settlement italicized text in lines 4-5; penalty 6 (Dkt. No. 90) amount in line 28 Page 3: lines 5-12, 15-17, Denied 7 18-23 g Page 4: lines 6-13, 15-28 Granted only as to penalty amount in lines 24, 26, and 28 9 Page 5: lines 1-2 Granted only as to word 8 of line | 10 With respect to Exhibits 2-9, 10-13, and 15-17 to the Jang Declaration submitted in 11 support of Apple’s motion to enforce settlement, Apple shall submit revised redacted versions of
= 2 these documents that reflect the above rulings by March 4, 2022. The Court expects that its
& 13 rulings above will provide substantial guidance to Apple regarding what material may be properly
14 filed under seal moving forward. If Apple elects not to resubmit revised redactions by March 4,
© B15 the Court shall unseal the documents in their entirety. A 16 Finally, as to Apple’s motion to remove incorrectly filed documents from the docket (Dkt.
3 17 No. 81), the docket is a matter of public and appellate record, and thus items filed on the docket 1g || may not be removed. However, the Court shall maintain the incorrectly filed documents under 19 seal. 91 Dated: February 25, 2022 22 C ) ( ( I 23 EDWARD J. DAVILA 24 United States District Judge 25 26 27 28 Case No.: 5:19-cv-03034-EJD ORDER GRANTING IN PART AND DENYING IN PART ADMIN. MOTS. TO SEAL