JBS Packerland, Inc. v. Phillips Cattle Co., Inc.

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JBS PACKERLAND, INC., Case No. 24-cv-01299-BAS-MSB 12 Plaintiff, ORDER GRANTING AMENDED 13 v. MOTION TO SEAL COMPLAINT 14 (ECF No. 15)

16 Defendant. 17 18

19 Presently before the Court is Plaintiff JBS Packerland, Inc.’s Amended Motion to 20 Seal the Complaint. (ECF No. 15.) The Court finds there are compelling reasons to seal 21 limited financial information in the Complaint. Hence, for the following reasons, the Court 22 GRANTS the Amended Motion to Seal. 23 I. Legal Standard 24 “[T]he courts of this country recognize a general right to inspect and copy public 25 records and documents, including judicial records and documents.” Nixon v. Warner 26 Commc’ns, Inc., 435 U.S. 589, 597 (1978). “Unless a particular court record is one 27 ‘traditionally kept secret,’ a ‘strong presumption in favor of access’ is the starting point.” 28 Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (citing Foltz v. 1 State Farm Mut. Auto Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). “The presumption 2 of access is ‘based on the need for federal courts, although independent—indeed, 3 particularly because they are independent—to have a measure of accountability and for the 4 public to have confidence in the administration of justice.’” Ctr. for Auto Safety v. Chrysler 5 Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016) (quoting United States v. Amodeo, 71 F.3d 6 1044, 1048 (2d Cir. 1995)). 7 A party seeking to seal a judicial record bears the burden of overcoming the strong 8 presumption of access. Foltz, 331 F.3d at 1135. The showing required to meet this burden 9 depends upon whether the documents to be sealed relate to a motion that is “more than 10 tangentially related to the merits of the case.” Ctr. for Auto Safety, 809 F.3d at 1102. When 11 the underlying motion is more than tangentially related to the merits, the “compelling 12 reasons” standard applies. Id. at 1096–98. When the underlying motion does not surpass 13 the tangential relevance threshold, the “good cause” standard applies. Id. An action’s 14 complaint, and its associated exhibits, are more than tangentially related to the merits of 15 the case. Id. at 1098. Similarly, a party’s opposition to a motion to dismiss is more than 16 tangentially related to the merits of the case. Ctr. for Auto Safety, 809 F.3d at 1098. 17 “In general, ‘compelling reasons’ sufficient to outweigh the public’s interest in 18 disclosure and justify sealing court records exist when such ‘court files might have become 19 a vehicle for improper purposes,’ such as the use of records to gratify private spite, promote 20 public scandal, circulate libelous statements, or release trade secrets.” Kamakana, 447 21 F.3d at 1179 (quoting Nixon, 435 U.S. at 598). As to this last category, courts have been 22 willing to seal court filings containing confidential business material, “such as marketing 23 strategies, product development plans, licensing agreements, and profit, cost, and margin 24 data,” where the parties have been able to point to concrete factual information to justify 25 sealing. See, e.g., Cohen v. Trump, No. 13-cv-2519-GPC-WVG, 2016 WL 3036302, at *5 26 (S.D. Cal. May 27, 2016). However, “[t]he mere fact that the production of records may 27 lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will not, 28 without more, compel the court to seal its records.” Kamakana, 447 F.3d at 1179. A 1 blanket protective order is not itself sufficient to show “good cause,” let alone compelling 2 reasons, for sealing particular documents. See Foltz, 331 F.3d at 1133; San Jose Mercury 3 News, Inc. v. U.S. Dist. Ct., N. Dist., 187 F.3d 1096, 1103 (9th Cir. 1999). The decision to 4 seal documents is “one best left to the sound discretion of the trial court” upon 5 consideration of “the relevant facts and circumstances of the particular case.” Nixon, 435 6 U.S. at 599. 7 In addition, parties moving to seal documents must comply with the procedures set 8 forth in this Court’s standing order for filing documents under seal. See Standing Order of 9 the Hon. Cynthia Bashant for Civil Cases ¶ 5. The rule permits sealing of “only those 10 documents, or portions thereof, necessary to protect such sensitive information.” Id. Thus, 11 although sometimes it may be appropriate to seal a document in its entirety, whenever 12 possible, a party must redact the document appropriately. See Kamakana, 447 F.3d at 1183 13 (noting a preference for redactions so long as they “have the virtue of being limited and 14 clear”); Murphy v. Kavo Am. Corp., No. 11–cv–00410–YGR, 2012 WL 1497489, at *2–3 15 (N.D. Cal. Apr. 27, 2012) (denying motion to seal exhibits but directing parties to redact 16 confidential information). 18 This action stems from an alleged breach of future contracts for the purchase and 19 delivery of cattle. Plaintiff seeks to seal part of the Complaint. (ECF No. 15.) Previously, 20 Plaintiff sought to seal all the Complaint’s factual allegations but publicly reveal the causes 21 of action. (ECF No. 3.) The Court denied without prejudice this request. (ECF No. 14.) 22 The Court explained: 23 [A]lthough there may be commercially sensitive information in the contracts, 24 Plaintiff’s proposed redactions are overbroad. This breach of contract action cannot be litigated in secrecy. The public has the right to know the gist of the 25 underlying contracts in order to understand this Court’s rulings. At the same 26 time, the Court recognizes that sensitive pricing information and other terms of the contracts may be subject to sealing under the compelling reasons 27 standard. 28 (Id.) I Plaintiffs Amended Motion to Seal seeks to redact only limited financial 2 ||information in the Complaint. Plaintiff also submits a declaration from its Head of Cattle 3 Procurement, which explains that the future contracts contain “commercially sensitive 4 |/information, such as non-public pricing terms including the number of steers to be 5 || delivered to [Plaintiff], the weight of the steers, and the price per hundredweight.” (Rose 6 ||Decl. § 5, ECF No. 15-3.) Disclosure of this information would harm □□□□□□□□□□□ 7 || competitive standing, as it would impact Plaintiff's ability to negotiate these contracts, and 8 || Plaintiff's competitors would be able to use the information. (/d. ¥ 8.) 9 Plaintiffs Amended Motion persuasively satisfies the sealing standard in this 10 |}context. The Court finds there are compelling reasons to seal the sensitive financial 11 |/information in the Complaint. See Fed. Trade Comm’n v. Qualcomm, Inc., No. 17-cv- 12 |}00220-LHK, 2019 WL 95922, at *3 (N.D. Cal. Jan. 3, 2019) (finding compelling reasons 13 “information that, if published, may harm [a party’s] or third parties’ competitive 14 ||standing and divulges terms of confidential contracts, contract negotiations, or trade 15 ||secrets”). Further, Plaintiffs proposed redactions are narrow and appropriate. 16 Consequently, the Court grants the Amended Motion to Seal. 17 || II. CONCLUSION 18 For the foregoing reasons, the Court GRANTS Plaintiff's Amended Motion to Seal 19 Complaint (ECF No. 15). The Clerk of Court shall accept and FILE UNDER SEAL 20 ||the unredacted Complaint (ECF No. 16). Further, the Clerk shall take the Proposed 21 Redacted Complaint (ECF No. 15-2.) and add it to ECF No. | as the public-facing 22 || Complaint for this action. 24 / yy 25 || DATED: October 4, 2024 asf rd 4. Haha, 6 United States District Judge 27 28 -4- 24cv1299