Caremark LLC, et al. v. Protecting Access to Retail Pharmacy LLC

• Court: District Court, D. Arizona
• Decided: June 8, 2026
• Docket: 2:25-cv-01524
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 Caremark LLC, et al., No. CV-25-01524-PHX-DWL

10 Plaintiffs, ORDER

11 v.

12 Protecting Access to Retail Pharmacy LLC,

13 Defendant. 14 15 On July 3, 2025, Defendant Protecting Access to Retail Pharmacy LLC d/b/a 16 TRUST LCC (“TRUST LLC”) filed a “Motion to Compel Arbitration, Or, in the 17 Alternative, to Dismiss for Lack of Personal Jurisdiction Under Rule 12(b)(2).” (Doc. 12.) 18 In that motion, TRUST LLC asked the Court “to apply the delegation clause of the 19 arbitration provision in Caremark’s Provider Manual, grant TRUST LLC’s motion to 20 compel arbitration, and stay this action.” (Id. at 10.) “In the alternative, if the Court 21 decide[d] that TRUST LLC may not invoke the Provider Manual, TRUST LLC ask[ed] 22 this Court to dismiss this action for lack of personal jurisdiction.” (Id.) 23 On July 17, 2025, Plaintiffs Caremark LLC and CaremarkPCS LLC (“Caremark”) 24 filed a response, “consent[ing] to the Court compelling arbitration of Caremark’s claim” 25 and asking the Court to “enter TRUST LLC’s proposed order regarding its motion to 26 compel arbitration, compel the parties to arbitration, and stay this case.” (Doc. 14 at 2.) 27 Caremark added:

28 Because entering TRUST LLC’s proposed order compelling the parties to arbitration would grant TRUST LLC the primary relief that it seeks, the 1 Court need not address TRUST LLC’s “alternative” request for dismissal for lack of personal jurisdiction. However, if the Court does address TRUST 2 LLC’s alternative request, it should not dismiss the case. Caremark’s allegations establish that TRUST LLC is subject to specific personal 3 jurisdiction in this Court. 4 (Id.) Caremark then set forth arguments as to why the Court may exercise personal 5 jurisdiction over TRUST LLC. (Id. at 2-5.) 6 On July 25, 2025, the Court granted the motion to compel arbitration and stayed the 7 action pending the resolution of the arbitration proceeding. (Doc. 15.) The Court also 8 ordered periodic joint notices concerning the status of the arbitration proceeding and a joint 9 notice within ten days of when the arbitration proceeding concluded. (Id.) 10 On May 7, 2026, the parties filed a joint notice indicating that on April 27, 2026, 11 the arbitration panel issued the Final Award. (Doc. 17 at 1.) The joint notice also describes 12 an unresolved dispute. Caremark argues that “[t]he Final Award in Caremark’s favor 13 moots this court action” and “respectfully requests a status conference with this Court to 14 discuss the appropriate next steps, in light of what appears to Caremark to clearly be an 15 improper circumvention of the Final Award.” (Id. at 2-3.) TRUST LLC, however, argues 16 that because the arbitration panel determined that it lacked jurisdiction to hear the 17 arbitration demand, the arbitration clause is no longer enforceable and any statements the 18 panel made on other issues were “dicta,” as the panel, “according to its own ruling, lacked 19 jurisdiction to address them.” (Id. at 3-4.) TRUST LLC therefore argues that “[a]s a result 20 of the arbitration Panel’s lack of jurisdiction and the conclusion of the arbitration 21 proceeding, the Action should proceed in this Court,” and as such, TRUST LLC asks the 22 Court to lift the stay, allowing TRUST LLC to file an answer and counterclaims. (Id. at 23 4.) 24 In tandem with filing the joint statement setting forth this dispute, the parties lodged 25 a copy of the Final Award under seal. (Doc. 19.) The parties have since filed a joint motion 26 to seal the Final Award. (Doc. 20.) The parties’ sole basis for sealing the award is that the 27 arbitration agreement contains the following confidentiality clause:

28 Except as may be required by Law, a party, its employees, agents, consultants, authorized representatives, counsel, or arbitrator(s) shall not 1 disclose the existence, content, or results of any dispute or arbitration hereunder without the prior written consent of both parties. 2 3 (Doc. 20 at 2-3.) The parties cite Caremark, LLC v. USRC Pharmacy, LLC, 2023 WL 4 2973327 (D. Ariz. 2023), for the proposition that because arbitration agreements must be 5 enforced “according to their terms,” a confidentiality clause in an arbitration agreement 6 restricting disclosure without the parties’ consent is sufficient to allow parties that jointly 7 desire to keep the results of their arbitration private to file the arbitration award under seal 8 in federal court submissions. 9 The Court is not persuaded. In the Ninth Circuit, “[t]wo standards generally govern 10 motions to seal documents.” Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 677-78 (9th 11 Cir. 2010). Those two standards are referred to as “the presumptive ‘compelling reasons’ 12 standard or the ‘good cause’ exception.” Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 13 F.3d 1092, 1097 (9th Cir. 2016). The presumptive “compelling reasons” standard applies 14 when the documents that are the subject of the sealing request are being filed in conjunction 15 with a motion or pleading that “is more than tangentially related to the underlying cause of 16 action” or “the merits of a case.” Id. at 1099. The “good cause” exception most often 17 applies to “sealed materials attached to a discovery motion unrelated to the merits of a 18 case.” Id. at 1097. Here, although the parties’ joint report is not styled as a motion, the 19 parties effectively dispute whether the arbitration award terminates this case, as well as 20 whether the arbitration panel’s determinations as to whether the pharmacy assignments to 21 TRUST LLC were effective “were dicta.” (Doc. 17 at 2-4.) Both the joint report and the 22 arbitration award are more than tangentially related to the merits of the case, and the 23 “compelling reasons” standard applies. 24 Under that standard, a party seeking to seal a judicial record must overcome “a 25 strong presumption in favor of access.” Kamakana v. City & Cty. of Honolulu, 447 F.3d 26 1172, 1178 (9th Cir. 2006). To do so, the party must “articulate compelling reasons 27 supported by specific factual findings that outweigh the general history of access and the 28 public policies favoring disclosure . . . .” Id. at 1178-79 (cleaned up). The Court must then 1 “conscientiously balance the competing interests of the public and the party who seeks to 2 keep certain judicial records secret.” Id. at 1179 (cleaned up). “After considering these 3 interests, if the court decides to seal certain judicial records, it must base its decision on a 4 compelling reason and articulate the factual basis for its ruling, without relying on 5 hypothesis or conjecture.” Id. (cleaned up). “The party seeking to seal any part of a judicial 6 record bears the heavy burden of showing that the material is the kind of information that 7 courts will protect and that disclosure will work a clearly defined and serious injury to the 8 party seeking closure,” Oliner v. Kontrabecki, 745 F.3d 1024, 1026 (9th Cir. 2014), at 9 which point that injury is weighed against the public’s interest in disclosure. Kamakana, 10 447 F.3d at 1178-79. “The mere fact that the production of records may lead to a litigant’s 11 embarrassment, incrimination, or exposure to further litigation will not, without more, 12 compel the court to seal its records.” Id. 13 Applying these standards, the parties’ sealing request lacks merit. As noted, the 14 parties’ sole proffered reason for seeking to overcome the strong presumption in favor of 15 public access is that they agreed with each other to maintain the confidentiality of any 16 details related to their arbitration proceeding. But as many courts (including this Court) 17 have concluded, this is an insufficient basis for a sealing request in an action to enforce or 18 vacate an arbitration award. See, e.g., Personnel Staffing Grp., LLC v. XL Ins. Am., Inc., 19 2022 WL 18717593, *2 (C.D. Cal. 2022) (“The Respondents . . . have failed to provide 20 specific factual findings demonstrating why the request to seal the Confidential Documents 21 outweighs the general history of access and the public policies favoring disclosure as 22 required under the compelling reasons standard. Although courts consider the confidential 23 nature of arbitration proceedings in addressing later motions to seal arbitration information, 24 such settlement or arbitration information is not entitled to sealing in later proceedings 25 simply because the parties bargained for confidentiality; the calculus changes once the 26 parties reenter the courthouse for adjudication of their dispute.”) (cleaned up); Bloom 27 Energy Corp. v. Badger, 2021 WL 4079208, *11-12 (N.D. Cal. 2021) (denying unopposed 28 request to seal arbitration award in an action to enforce/vacate the award and explaining 1 that “[t]he fact that the parties privately bargained to keep a proceeding confidential does 2 not nullify the requirement that a party proffer a qualifying reason to justify sealing that 3 document when put at issue in a public forum”); Ovonic Battery Co., Inc. v. Sanyo Electric 4 Co., Ltd, 2014 WL 2758756, *3 (N.D. Cal. 2014) (“OBC also seeks to seal the interim and 5 final arbitration awards in their entirety . . . [and] claims that the awards are to remain 6 confidential subject to limited exception according to the governing International 7 Arbitration Rules and order of the Arbitration Panel. The fact that parties agreed to the 8 confidentiality of certain documents, however, does not alone constitute a compelling 9 reason to seal them.”). See also Robertson v. Argent Trust Co., 2025 WL 2676091 (D. 10 Ariz. 2025) (denying sealing requests under analogous circumstances). As one court 11 cogently put it:

12 The mere fact that plaintiff and defendant have agreed to maintain their arbitration proceeding in confidence is of little moment. . . . Voluntary 13 arbitrations are private proceedings. Therefore, the parties are free to agree that their arbitration proceedings will be held in confidence. Once the parties 14 resort to the courts, however, their confidentiality agreement does not, and cannot, authorize the sealing of a presumptively public federal court record. 15 The parties are privileged to arbitrate in secret, but they must litigate in public. 16 17 Martis v. Dish Network, 2013 WL 6002208, *2 (W.D. Mich. 2021). 18 In a related vein, the parties’ motion conspicuously does not assert that the public 19 disclosure of the details set forth in the arbitration award would actually cause them to 20 suffer any tangible harm. They have not, for example, persuasively argued (or even 21 suggested) that public disclosure of the materials sought to be sealed would compromise 22 trade secrets or other sensitive information. GST Int’l, Inc. v. Martin, 2025 WL 843389, 23 *2 (D. Nev. 2025) (“GST has provided facts to justify sealing parts of the arbitral award 24 attached to their motion, but not enough to justify sealing the entire document. In favor of 25 sealing, the arbitral award contains sensitive trade secrets related to GST’s products. . . . 26 Yet GST has filed for the entire 121-page report to be filed under seal, and the Court cannot 27 allow an entire arbitration award to be sealed simply because the parties agreed to 28 confidentiality of the underlying arbitral process. Accordingly, the Court will allow the 1 arbitral award to remain filed under seal but require filing of the award with redactions 2 limited to confidential information.”); Oliner, 745 F.3d at 1026 (“The party seeking to seal 3 any part of a judicial record bears the heavy burden of showing that . . . disclosure will 4 work a clearly defined and serious injury to the party seeking closure.”). Instead, as noted, 5 the parties’ sole proffered basis for the sealing request is their own agreement to maintain 6 the confidentiality of any arbitration-related details. 7 On the other side of the ledger is the public’s interest in understanding the basis for 8 any decision issued by this Court. Kamakana, 447 F.3d at 1179 (courts must 9 “conscientiously balance the competing interests of the public”). That interest would be 10 undermined if the parties’ sealing request were approved—the public would have no 11 information about the underlying decision and thus lack any basis for evaluating the 12 soundness of the Court’s resolution of the parties’ unresolved dispute over how to proceed 13 in this case in light of the award. Pintos, 605 F.3d at 679 n.6 (one of the relevant factors 14 when evaluating a sealing request is the “public interest in understanding the judicial 15 process”) (citation omitted). The overbreadth of the parties’ sealing requests also 16 undermines those requests. Bloom Energy Corp., 2021 WL 4079208 at *12-13 17 (“[P]etitioner does not make any attempt to narrowly tailor its sealing requests to only those 18 (even arguably) protectable portions of the Final Award. For example, petitioner seeks to 19 seal mere statements of the law recited by the panel in the Final Award. Other low-hanging 20 fruit include provisions in the Final Award that are identical to those alleged by petitioner 21 in its publicly filed petition. Petitioner’s failure to comply with the narrowly tailored 22 requirement provide an independent ground for denying its motion to seal the Final 23 Award.”). 24 Thus, the parties’ joint motion to seal (Doc. 20) is denied. Moreover, although the 25 parties’ joint notice provides an overview of the parties’ competing views of the effect of 26 the arbitration award on this action, there is no motion pending at this time. Under Rule 27 7(b) of the Federal Rules of Civil Procedure, a request for judicial action “must be made 28 by motion.” The Court is not inclined to set “a brief status conference” (Doc. 17 at 2) to || resolve the merits of a disputed and potentially complicated issue that has not been properly || raised via a motion. 3 At any rate, this action was stayed “pending the resolution of the arbitration 4|| proceeding.” (Doc. 15.) The arbitration proceeding has been resolved, except for the 5|| ancillary matter of fees. Thus, the stay of this action has expired.! The Clerk of Court is || directed to remove the stay designation from this case. 7 To the extent Caremark believes the arbitration award “moots this court action” 8 || (Doc. 17 at 2), Caremark can seek relief as it sees fit by means of a fully developed motion 9|| that “state[s] the relief sought” and “‘state[s] with particularity the grounds for seeking the order.” Fed. R. Civ. P. 7(b). 11 Accordingly, 12 IT IS ORDERED that the parties’ joint motion to seal (Doc. 20) is denied. 13 || Pursuant to LRCiv 5.6(e), the lodged document at Doc. 19 will not be filed but will remain under seal.’ 15 IT IS FURTHER ORDERED that the Clerk of Court shall remove the stay designation from this action. 17 Dated this 8th day of June, 2026. 18 19 Pm ee 20 } Dominic W. Lanza 21 United States District Judge 22 23 24 — As such, the relief TRUST LLC purported to seek in the joint report is moot. *____ There is no need, at this time, to resubmit the arbitration award for filing in the 27|| public record, as usually contemplated under LRCiv 5.6(e), because there is no pending request for relief that is dependent on the arbitration award. But to the extent a party makes 28 || a future request for relief that is dependent on the arbitration award and wishes to file the arbitration award in support of that request, it must be filed publicly.

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