Big Run Studios Inc. v. AviaGames Inc.

• Court: District Court, N.D. California
• Decided: March 28, 2024
• Docket: 3:21-cv-04656
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BIG RUN STUDIOS INC., et al., Case No. 21-cv-04656-AMO

8 Plaintiffs, OMNIBUS SEALING ORDER v. 9 Re: Dkt. Nos. 196, 208, 209, 213, 218 10 AVIAGAMES INC., Defendant. 11

12 13 Before the Court are Plaintiffs’ Administrative Motions to File Documents Under Seal 14 (ECF 196, 208, 209, 218) and Defendant’s Unopposed Administrative Motion to Consider 15 Whether Another Party’s Material Should be Filed Under Seal (ECF 213) (collectively 16 “Administrative Motions”).1 Statements in support of these administrative motions to seal were 17 filed by the parties and non-party Playtika Santa Monica, LLC. See ECF 207, 211, 216, 217, 218- 18 1, and 226. 19 The Court, having carefully considered the submissions, the record, the applicable law, and 20 any arguments related thereto, hereby orders that the Parties’ Administrative Motions are 21 GRANTED in part and DENIED in part. 22 LEGAL STANDARD 23 Pursuant to Civil Local Rule 79-5, the party seeking to file a document or portions of it 24 under seal must explain “(i) the legitimate private or public interests that warrant sealing; (ii) the 25 injury that will result if sealing is denied; and (iii) why a less restrictive alternative to sealing is 26 not sufficient.” Civil L.R. 79-5(c)(1). The request must be “narrowly tailored to seal only the 27 1 sealable material.” Id. at 79-5(c)(3). 2 A party seeking to seal records must provide “compelling reasons” to overcome the 3 “strong presumption in favor of access.” Kamakana v. City & Cty. Of Honolulu, 447 F.3d 1172, 4 1178 (9th Cir. 2006); see Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th 5 Cir. 2016). The standard derives from the “common law right ‘to inspect and copy public records 6 and documents, including judicial records and documents.’” Pintos v. Pac. Creditors Ass’n, 605 7 F.3d 665, 678 (9th Cir. 2010) (quoting Kamakana, 447 F.3d at 1178). To overcome this strong 8 presumption, the party seeking to seal judicial records must “articulate compelling reasons 9 supported by specific factual findings . . . that outweigh the general history of access and the 10 public policies favoring disclosure, such as the public interest in understanding the judicial 11 process.” Kamakana, 447 F.3d at 1178-79 (citations omitted). The party must make a 12 “particularized showing” that “specific prejudice or harm will result” if the information is 13 disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1210-11 (9th Cir. 14 2002). 15 It is in the “sound discretion of the trial court” to determine what constitutes a “compelling 16 reason” for sealing a court document. Ctr. for Auto Safety, 809 F.3d at 1097 (quoting Nixon v. 17 Warner Commc’ns, Inc., 435 U.S. 589, 599 (1978)). Compelling reasons justifying sealing court 18 records generally exist when such “court files might . . . become a vehicle for improper purposes” 19 such as “releas[ing] trade secrets,” Kamakana, 447 F.3d at 1179, or “as sources of business 20 information that might harm a litigant’s competitive standing,” Ctr. for Auto Safety, 809 F.3d at 21 1097; see In re Elec. Arts, Inc., 298 F. App’x 568, 569 (9th Cir. 2008) (sealing trade secret 22 information about “the pricing terms, royalty rates, and guaranteed minimum payment terms” in 23 the parties’ licensing agreement). Records attached to nondispositive motions must meet the 24 lower “good cause” standard of Rule 26(c) of the Federal Rules of Civil Procedure, as such 25 records “are often unrelated, or only tangentially related, to the underlying cause of action.” 26 Kamakana, 447 F.3d at 1179-80 (quotations omitted). 27 DISCUSSION 1 standard of Rule 26(c) applies to the materials for which the parties seek sealing because they are 2 submitted in support of nondispositive motions. Many of the materials and redactions for which 3 these parties seek sealing constitute sources of business information that might harm the litigants’ 4 competitive standing and should remained sealed. See Kamakana, 447 F.3d at 1179; Ctr. for Auto 5 Safety, 809 F.3d at 1097. The Court correspondingly notes “confidential business information” 6 where appropriate to support sealing in the charts below. 7 1. ECF 196; see also ECF 207. 8 Document Sought to be Evidence in Support of Objections Court’s 9 Sealed Sealing to Sealing Ruling Plaintiffs’ Notice of Motion Sealing request withdrawn. DENIED. 10 and Motion to Modify Scheduling Order and Grant 11 Leave to File Third Amended Complaint (ECF 12 196-3) 13 Exhibit 1 to the Declaration Sealing request withdrawn. DENIED. of Chris Campbell in 14 Support of Plaintiff’s Motion to Modify 15 Scheduling Order and Grant Leave to File Third 16 Amended Complaint (ECF 196-4) 17 Exhibit A to Plaintiffs’ Sealing request withdrawn. DENIED. Notice of Motion And 18 Motion to Modify Scheduling Order and Grant 19 Leave to File Third Amended Complaint (ECF 20 196-5) 21 2. ECF 208; see also ECF 211 22 23 Document Sought to be Evidence in Support of Objections Court’s Sealed Sealing to Sealing Ruling 24 Plaintiffs’ Big Run Studios ECF 208-3 through ECF 208- None GRANTED. Inc. and Skillz Platform 19 comprise AviaGames’ AEO Confidential 25 Inc.’s L.R. 79-5(c)(1) documents, which are sensitive business Statement (“Statement”) internal business information. 26 (ECF 208-2) (highlighted communications that were not portions other than ¶ 3) exhibits on the public record 27 through the patent case. ECF 208-2 quotes from the Lark Document Sought to be Evidence in Support of Objections Court’s 1 Sealed Sealing to Sealing Ruling their contents. The motion to 2 seal ¶ 3 was withdrawn, and therefore the proposed 3 redactions thereto are moot. Exhibit A to Statement, Request to seal withdrawn. DENIED. 4 Bates numbered AVIA0211081, produced by 5 AviaGames (ECF 208-3) 6 Exhibit B to Statement, ECF 208-3 through ECF 208- None GRANTED. Bates numbered 19 comprise AviaGames’ AEO Confidential 7 AVIA0210987, produced by documents, which are sensitive business AviaGames (ECF 208-4) internal business information. 8 (entire document) communications that were not exhibits on the public record 9 through the patent case. Exhibit C to Statement, Same as above. None GRANTED. 10 Bates numbered Confidential AVIA0210989 produced by business 11 AviaGames (ECF 208-5) information. (entire document) 12 Exhibit D to Statement, Same as above. None GRANTED. Bates numbered Confidential 13 AVIA0219930, produced by business AviaGames (ECF 208-6) information. 14 (entire document) 15 Exhibit E to Statement, Same as above. None GRANTED. Bates numbered Confidential 16 AVIA0217223, produced by business AviaGames (ECF 208-7) information. 17 (entire document) Exhibit F to Statement, Same as above. None GRANTED. 18 Bates numbered Confidential AVIA0193434, produced by business 19 AviaGames (ECF 208-8) information. (entire document) 20 Exhibit G to Statement, Same as above. None GRANTED. 21 Bates numbered Confidential AVIA0211000, produced by business 22 AviaGames (ECF 208-9) information. (entire document) 23 Exhibit H to Statement, Same as above. None GRANTED. 24 Bates numbered Confidential AVIA0211063, produced by business 25 AviaGames (ECF 208-10) information. (entire document) 26 27 1 3. ECF 209; see also ECF 211 2 Document Sought to be Evidence in Support of Objections Court’s 3 Sealed Sealing to Sealing Ruling Plaintiffs’ Big Run Studios ECF 209-2 through ECF 209-9 None GRANTED. 4 Inc. and Skillz Platform comprise AviaGames’ AEO Confidential Inc.’s L.R. 79-5(c)(1) documents, which are sensitive business 5 Statement (“Statement”) internal business information. (ECF 209) (highlighted communications that were not 6 portions other than ¶ 3) exhibits on the public record through the patent case. ECF 7 209 quotes from the Lark messages and/or describes 8 their contents. The motion to seal ¶ 3 was withdrawn, and 9 therefore the proposed redactions thereto are moot. 10 Exhibit A to Statement Request to seal withdrawn. DENIED. (ECF 209-1) 11 Exhibit B to Statement ECF 209-2 through ECF 209-9 None GRANTED. 12 (ECF 209-2) (entire comprise AviaGames’ AEO Confidential document) documents, which are sensitive business 13 internal business information. communications that were not 14 exhibits on the public record through the patent case. 15 Exhibit C to Statement Same as above. None GRANTED. (ECF 209-3) (entire Confidential 16 document) business information. 17 Exhibit D to Statement Same as above. None GRANTED. (ECF 209-4) (entire Confidential 18 document) business information. 19 Exhibit E to Statement Same as above. None GRANTED. (ECF 209-5) (entire Confidential 20 document) business information. 21 Exhibit F to Statemen (ECF Same as above. None GRANTED. 209-6) (entire document) Confidential 22 business information. 23 Exhibit G to Statement Same as above. None GRANTED. (ECF 209-7) (entire Confidential 24 document) business information. 25 Exhibit H to Statement Same as above. None GRANTED. (ECF 209-8) (entire Confidential 26 document) business information. 27 1 4. ECF 213; see also ECF 216 and ECF 217 2 Document Sought to be Evidence in Support of Objections Court’s 3 Sealed Sealing to Sealing Ruling 4 AviaGames’ Opposition to The highlighted portions of None GRANTED. 5 Big Run and Skillz’ Motion Avia’s opposition to Plaintiffs’ Confidential for Leave to File a Third motion to amend are properly business 6 Amended Complaint redacted. The opposition information. (“Opposition”) (ECF 213- contains highly confidential 7 24) (highlighted portions) information from the documents discussed below, 8 including detailed, non-public, and confidential information 9 about Skillz and Big Run Studios’s financial information 10 and market research, their analysis of their services, and 11 their analysis of competitors. Plaintiffs have demonstrated 12 they would suffer competitive harm if this information were 13 released publicly because competitors could use this 14 information to harm Plaintiffs. See Dkts. 216 and 217. 15 Exhibit A to Opposition, Exhibits A, B, C, D, E, and F None GRANTED. Bates Numbered SKILLZ- contain Skillz’s assessment Confidential 16 0086001 (ECF 213-3) and analysis of Avia, its business (entire document) competitor. Skillz has information. 17 demonstrated that the public release of these document 18 could harm Skillz’s business relationships, such as its 19 relationship with other companies discussed or with 20 app store operators. See Jones v. PGA Tour, Inc., 2023 WL 21 2232094, at *3 (N.D. Cal. Feb. 23, 2023) (finding there was 22 good cause to seal where “public disclosure of [the] 23 information would result in competitive harm to [a party] 24 and damage its business relationships.”). Moreover, 25 Skillz has demonstrated that public disclosure of this 26 information could put Skillz at a competitive disadvantage 27 with other competitors besides Avia, which could capitalize Document Sought to be Evidence in Support of Objections Court’s 1 Sealed Sealing to Sealing Ruling 2 supplement their own 3 operations and decisionmaking. See ECF 217 4 at 1. Exhibit B to Opposition, Same as above. None GRANTED. 5 Bates Numbered SKILLZ- Confidential 0085687 (ECF 213-4) business 6 (entire document) information. Exhibit C to Opposition, Same as above. None GRANTED. 7 Bates Numbered SKILLZ- Confidential 0605335 (ECF 213-5) business 8 (entire document) information. 9 Exhibit D to Opposition, Same as above. None GRANTED. Bates Numbered SKILLZ- Confidential 10 0605350 (ECF 213-6) business (entire document) information. 11 Exhibit E to Opposition, Same as above. None GRANTED. Bates Numbered SKILLZ- Confidential 12 0605567 (ECF 213-7) business (entire document) information. 13 Exhibit F to Opposition, Same as above. None GRANTED. 14 Bates Numbered SKILLZ- Confidential 0605581 (ECF 213-8) business 15 (entire document) information. Exhibit G to Opposition, Exhibits G, H, I, J, K, M, and None GRANTED. 16 Bates Numbered Skillz- N are properly sealed because Confidential 0052840 (ECF 213-9) they include detailed, business 17 (entire document) nonpublic, and confidential information. development discussions and 18 notes related to the revision and improvement of Skillz’s 19 services. See FTC v. Qualcomm Inc., 2019 WL 20 95922, at *2-3 (N.D. Cal. Jan. 3, 2019) (sealing documents 21 that contained “detailed, non- public and confidential” 22 information regarding “research and development 23 activities”). Skillz has demonstrated it would suffer 24 competitive harm if these internal documents were 25 released publicly because the information contained in these 26 exhibits could permit competitors to gain access to 27 Skillz’s operational Document Sought to be Evidence in Support of Objections Court’s 1 Sealed Sealing to Sealing Ruling 2 positioning vis-à-vis its 3 competitors. See In re Incretin- Based Therapies Prod. Liab. 4 Litig., 2021 WL 873290, at *2 (S.D. Cal. Mar. 9, 2021) 5 (noting that “courts have maintained documents under 6 seal” where those documents contained similar information). 7 If Skillz’s competitors have access to that information, they 8 could exploit it to gain market advantage. See ECF 217 at 1-2. 9 Exhibit H to Opposition, Same as above. None GRANTED. Bates Numbered SKILLZ- Confidential 10 0529352 (ECF 213-10) business (entire document) information. 11 Exhibit I to Opposition, Same as above. None GRANTED. Bates Numbered SKILLZ- Confidential 12 0284239 (ECF 213-11) business (entire document) information. 13 Exhibit J to Opposition, Same as above. None GRANTED. 14 Bates Numbered SKILLZ- Confidential 0284236 (ECF 213-12) business 15 (entire document) information. Exhibit K to Opposition, Same as above. None GRANTED. 16 Bates Numbered SKILLZ- Confidential 0501741 (ECF 213-13) business 17 (entire document) information. 18 Exhibit L to Opposition, Exhibit L is properly sealed None GRANTED. Bates Numbered SKILLZ- because it includes detailed, Confidential 19 0072603 (ECF 213-14) non-public, and confidential business (entire document) descriptions of Skillz’s information. 20 financial information and market research. See Apple 21 Inc. v. Samsung Elecs. Co., 727 F.3d 1214, 1226, 1228 22 (Fed. Cir. 2013) (district court abused its discretion in 23 unsealing “financial information” and “market 24 research”). Skillz has shown it would suffer competitive harm 25 if these internal documents were released publicly, 26 particularly because its competitors would gain access 27 to, and could therefore capitalize on, Skillz’s hard- Document Sought to be Evidence in Support of Objections Court’s 1 Sealed Sealing to Sealing Ruling 2 See, e.g., Rodman v. Safeway 3 Inc., 2015 WL 13673842, at *2 (N.D. Cal. Aug. 4, 2015) 4 (granting the defendant’s “narrowly tailored” request to 5 seal “internal, nonpublic information discussing 6 Safeway’s pricing strategy, business decision-making, 7 customer research, and financial records, which would 8 expose Safeway to competitive harm if disclosed”) (applying 9 more onerous “compelling reasons” standard for 10 documents attached to dispositive briefing). Skillz 11 has also shown competitors could use the information 12 about Skillz’s pricing models and promotional strategy to 13 exploit the information by offering better pricing and 14 promotions to potential Skillz customers thus usurping 15 Skillz’s market share. See ECF 217 at 2. 16 Exhibit M to Opposition, Same as exhibits A-G above. None GRANTED. Bates Numbered SKILLZ- Confidential 17 0159867 (ECF 213-15) business (entire document) information. 18 Exhibit N to Opposition, Same as exhibits A-G above. None GRANTED. Bates Numbered SKILLZ- Confidential 19 0087584 (ECF 213-16) business (entire document) information. 20 Exhibit O to Opposition, Request to seal withdrawn. DENIED. 21 Plaintiffs’ Requests for Admission (ECF 213-17) 22 Exhibit P to Opposition, Request to seal withdrawn. DENIED. Plaintiffs’ Requests for 23 Production (ECF 213-18) 24 Exhibit Q to Opposition, Request to seal withdrawn. DENIED. Plaintiffs’ Interrogatories 25 (ECF 213-19) Exhibit S to Opposition, Exhibit S comprises None GRANTED. 26 Bates Numbered, screenshots of internal records Confidential PLAYTIKA_21cv04656_00 and development notes related business 27 0001 (Dkts. 213-20 & 213- to non-party Playtika Santa information. Document Sought to be Evidence in Support of Objections Court’s 1 Sealed Sealing to Sealing Ruling 2 statement in support of 3 keeping this confidential document sealed. Playtika has 4 demonstrated compelling reasons for keeping its 5 company’s internal developmental information 6 confidential. ECF 216 at 1-2. Exhibit T to Opposition, Exhibit T is properly sealed None GRANTED. 7 Bates Numbered BIGRUN- because it contains detailed, Confidential 0001133 (ECF 213-22) non-public, and confidential business 8 (entire document) information about Big Run’s information. trademarks. Big Run has 9 demonstrated it would suffer competitive harm if this 10 document were released publicly because competitors 11 could use this information to harm Big Run. ECF 217 at 2. 12 Exhibit W to Opposition, Exhibit W is properly sealed None GRANTED. Bates Numbered BIGRUN- because it includes detailed, Confidential 13 0005812 (213-23) (entire non-public, and confidential business document) information about Big Run information. 14 Studios’s financial information and market research. See 15 Apple Inc., 727 F.3d at 1228 (district court abused its 16 discretion in unsealing “financial information” and 17 “market research”). BigRun has shown it would suffer 18 competitive harm if these documents were released 19 publicly, particularly because its competitors would gain 20 access to, and could therefore capitalize on, Big Run’s hard- 21 earned research information. See, e.g., Rodman, 2015 WL 22 13673842, at *2 (granting the defendant’s “narrowly 23 tailored” request to seal “internal, nonpublic 24 information discussing Safeway’s pricing strategy, 25 business decision-making, customer research, and 26 financial records, which would expose Safeway to competitive 27 harm if disclosed”) (applying more onerous “compelling Document Sought to be Evidence in Support of Objections Court’s 1 Sealed Sealing to Sealing Ruling 2 documents attached to 3 dispositive briefing). ECF 217- at 2-3. 4 5. ECF 218; see also ECF 218-1. 5 Document Sought to be Evidence in Support of Objections Court’s Sealed Sealing to Sealing Ruling 6 7 Plaintiffs’ Reply In Support Skillz has shown the None GRANTED. of Motion To Modify highlighted portion on Page 4, Confidential 8 Scheduling Order And line 25 through Page 5 line 4, business Grant Leave To File Third and Page 11, lines 13-19 information. 9 Amended Complaint (ECF discuss detailed, non-public, 218-3) (highlighted and confidential development 10 portions on Page 4, line 25 discussions and notes related through Page 5 line 4, and to the revision and 11 Page 11, lines 13 through improvement of Skillz’s 19) services. Skillz would also 12 suffer competitive harm if these internal documents were 13 released publicly, particularly because its competitors would 14 gain access to, and could therefore capitalize on, Skillz’s 15 hard-earned research information. See Jones v. PGA 16 Tour, Inc., 2023 WL 2232094, at *3 (N.D. Cal. Feb. 23, 2023) 17 (finding there was good cause to seal where “public 18 disclosure of [the] information would result in competitive 19 harm to [a party] and damage its business relationships”); 20 FTC v. Qualcomm Inc., 2019 WL 95922, at *2-3 (N.D. Cal. 21 Jan. 3, 2019) (sealing documents that contained 22 “detailed, non-public and confidential” information 23 regarding “research and development activities”). ECF 24 218-1 at 1-2. No party submitted any statement in 25 support of any other proposed redaction. The request to seal 26 the remaining redactions are therefore withdrawn. 27 1 In accordance with this order, Plaintiff is ordered to refile unredacted versions of ECF 196- 2 3, 196-4, 196-5, and 208-3, and Defendant is ordered to refile unredacted versions of ECF 213-17, 3 213-18, and 213-19. Plaintiff is further ordered to refile redacted versions of ECF 208-2, and 218- 4 3 as modified by this order. The parties are required to refile these documents by April 12, 2024. 5 Finally, the Court GRANTS Plaintiffs’ unopposed Motion to Remove Incorrectly Filed 6 Document. ECF 210. The Clerk shall seal ECF 209. 7 IT IS SO ORDERED. 8 Dated: March 28, 2024 9 = 1. 10 | Mnacoh Medbh CELI MARTINEZ-OLGUIN 11 United States District Judge a 12

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