Jones v. PGA Tour, Inc.

CourtDistrict Court, N.D. California
DecidedFebruary 21, 2023
Docket5:22-cv-04486
StatusUnknown

This text of Jones v. PGA Tour, Inc. (Jones v. PGA Tour, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jones v. PGA Tour, Inc., (N.D. Cal. 2023).

Opinion

1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 SAN JOSE DIVISION 6 7 MATT JONES, et al., Case No. 22-cv-04486-BLF

8 Plaintiffs, ORDER GRANTING IN PART AND 9 v. DENYING IN PART MOTION TO SEAL DOCUMENTS SUBMITTED 10 PGA TOUR, INC., WITH MOTION TO AMEND COUNTERCLAIM 11 Defendant. [Re: ECF No. 237] 12

13 14 Before the Court is Defendant and Counter-Claimant PGA Tour, Inc.’s (“the TOUR”) 15 Administrative Motion to Consider Whether Another Party’s Material Should Be Sealed. ECF 16 No. 237. Plaintiff and Counter-Defendant LIV Golf, Inc. (“LIV”) submitted a Statement in 17 Support of Sealing. ECF No. 260. LIV asks that the Court seal (1) portions of the TOUR’s 18 amended counterclaim; (2) portions of a redlined version of the TOUR’s amended counter claim; 19 (3) portions of the TOUR’s memorandum in support of its motion for leave to amend its 20 counterclaim; and (4) an exhibit the TOUR submitted in support of its motion. 21 For the reasons below, the Court GRANTS IN PART and DENIES IN PART the motion 22 to seal. 23 I. LEGAL STANDARD 24 “Historically, courts have recognized a ‘general right to inspect and copy public records 25 and documents, including judicial records and documents.’” Kamakana v. City & Cty. Of 26 Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc’ns, Inc., 435 27 U.S. 589, 597 & n.7 (1978)). Accordingly, when considering a sealing request, “a ‘strong 1 Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). Parties seeking to seal judicial records relating to 2 motions that are “more than tangentially related to the underlying cause of action” bear the burden 3 of overcoming the presumption with “compelling reasons” that outweigh the general history of 4 access and the public policies favoring disclosure. Ctr. for Auto Safety v. Chrysler Grp., 809 F.3d 5 1092, 1099 (9th Cir. 2016); Kamakana, 447 F.3d at 1178-79. 6 Courts have applied different standards when considering whether the grant a motion to 7 seal materials submitted with a motion to amend the pleadings. Some courts have held that a party 8 seeking to seal such materials need only demonstrate “good cause” to support their sealing 9 request. See, e.g., Edwards Lifesciences Corp. v. Meril Life Scis. Pvt. Ltd., No. 19-CV-06593- 10 HSG, 2021 WL 1312748, at *5 (N.D. Cal. Apr. 8, 2021) (“The documents at issue in the pending 11 motions to seal relate to Plaintiffs’ nondispositive motion for leave to file a second amended 12 complaint so the Court will apply the lower good cause standard.”). Other Courts have applied the 13 “compelling reasons” standard. See E. W. Bank v. Shanker, No. 20-CV-07364-WHO, 2021 WL 14 3471177, at *4 (N.D. Cal. Aug. 6, 2021) (“[Plaintiff’s] motion for leave to amend its FAC is a 15 nondispositive motion that is ‘more than tangentially related to the merits’ of this case, and 16 therefore the ‘compelling reasons’ standard applies.” (quoting Ctr. for Auto Safety, 809 F.3d at 17 1101)). 18 The Court agrees with the latter approach and analyzes the request to seal under the 19 “compelling reasons” standard. The Ninth Circuit has explained that the “focus” of the inquiry 20 regarding which standard applies to a motion to seal is not whether a motion is dispositive or 21 nondispositive, but rather “whether the motion at issue is more than tangentially related to the 22 underlying cause of action.” Ctr. For Auto Safety, 809 F.3d at 1099. The Court finds that a 23 motion to amend the pleadings is more than tangentially related to the underlying cause of action 24 given that the pleadings are the foundation of the lawsuit. C.f. Restoration Hardware, Inc. v. 25 Sichuan Wei Li Tian Xia Network Tech. Co., No. 22-CV-03054-JSC, 2023 WL 1769189, at *4 26 (N.D. Cal. Feb. 3, 2023) (complaint is “foundation of the lawsuit”). 27 Compelling reasons justifying the sealing of court records generally exist “when such 1 (quoting Nixon, 435 U.S. at 598), such as: “to gratify private spite, promote public scandal, 2 circulate libelous statements,” id.; “to release trade secrets,” id.; or “as sources of business 3 information that might harm a litigant’s competitive standing,” Ctr. for Auto Safety, 809 F.3d at 4 1097 (quoting Nixon, 435 U.S. at 598). On the other hand, “[t]he mere fact that the production of 5 records may lead to a litigant's embarrassment, incrimination, or exposure to further litigation will 6 not, without more, compel the court to seal its records.” Kamakana, 447 F.3d at 1178–79. The 7 party seeking to seal a judicial record bears the burden of “articulat[ing] compelling reasons 8 supported by specific factual findings.” Id. at 1182 (internal quotation marks omitted). The court 9 must then “conscientiously balance the competing interests of the public and the party who seeks 10 to keep certain judicial records secret.” Ctr. for Auto Safety, 809 F.3d at 1097 (internal quotation 11 marks and alterations omitted). 12 In addition, in this district, all parties requesting sealing must comply with Civil Local 13 Rule 79–5. That rule requires, among other things, the moving party to “establish . . . that the 14 document, or portions thereof, are privileged, protectable as a trade secret or otherwise entitled to 15 protection under the law.” Civ. L.R. 79–5(b). The request must also “be narrowly tailored to seek 16 sealing only of sealable material.” Civ. L.R. 79–5(b). Section (d) lays out the procedural 17 requirements for an administrative motion to seal, namely, a “declaration establishing that the 18 document sought to be filed under seal, or portions thereof, are sealable,” a proposed order that 19 “lists in table format each document or portion thereof that is sought to be sealed,” and an 20 “unredacted version of the document” that “indicate[s], by highlighting or other clear method, the 21 portions of the document that have been omitted from the redacted version.” Civ. L.R. 79–5(d). 22 II. DISCUSSION 23 In its statement in support of the TOUR’s administrative motion to seal, LIV asks the 24 Court to seal six categories of information. The Court analyzes each category below. 25 First, LIV seeks to seal portions of the TOUR’s proposed amended counterclaim and its 26 motion to amend that reference the terms of certain indemnification agreements. LIV declares that 27 disclosure of this information would harm LIV by revealing the contours of potential litigation, 1 Loffhagen Decl. ¶ 7. LIV explains that counterparties in the litigation could seek to drive up 2 costs to exceed the confidential indemnification amounts disclosed in the materials sought to be 3 sealed to encourage certain parties to give up their claims. Id. The Court finds that LIV has 4 adequately shown compelling reasons to seal this information, as LIV has provided a detailed 5 explanation as to how the information may “become a vehicle for improper purposes.” 6 Kamakana, 447 F.3d at 1179. Accordingly, the Court GRANTS the motion to seal this 7 information. 8 Second, LIV seeks to seal portions of the proposed amended counterclaim and the motion 9 to amend that describe a Shareholder Agreement that sets out LIV’s relationship with its investors, 10 including investor rights under that agreement. LIV declares that disclosure of the information 11 would harm LIV by prejudicing LIV’s ability to obtain outside funding, explaining that is current 12 investment structure gives certain investors rights that may deter outside funders or change the 13 terms that those funders demand. Loffhagen Decl. ¶ 3. The Court finds that LIV has 14 demonstrated compelling reasons to seal this information as LIV has explained how the disclosure 15 of these confidential terms of its Shareholder Agreement would harm LIV’s competitive standing. 16 See Fed. Trade Comm’n v. Qualcomm Inc., No. 17-CV-00220-LHK, 2019 WL 95922, at *3 (N.D. 17 Cal. Jan.

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Jones v. PGA Tour, Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/jones-v-pga-tour-inc-cand-2023.