McMillan v. Chaker

Opinion

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 SOUTHERN DISTRICT OF CALIFORNIA 9 10 SCOTT A. MCMILLAN, an Case No.: 3:16-cv-02186-WQH-MDD individual; THE MCMILLAN 11 LAW FIRM, APC, a California ORDER 12 professional corporation, Plaintiffs, 13 v. 14 15 DARREN D. CHAKER, an individual and as trustee of 16 PLATINUM HOLDINGS GROUP TRUST dba COUNTER 17 FORENSICS; NICOLE 18 CHAKER, an individual and as 19 trustee of THE NICOLE CHAKER REVOCABLE 20 LIVING TRUST, U/A dated August 18, 2010; VANIA 21 CHAKER, an individual and as 22 beneficiary of The Island 23 Revocable Trust under Declaration of Trust dated June 2, 2015; 24 MARCUS MACK, as trustee of The Island Revocable Trust under 25 Declaration of Trust dated June 2, 26 2015, 27 Defendants. 28 1 HAYES, Judge: 2 The matter before the Court is the Motion to File Documents Under Seal filed by 3 Defendant Darren D. Chaker. (ECF No. 118). 4 PROCEDURAL BACKGROUND 5 On August 29, 2016, Plaintiffs Scott A. McMillan and The McMillan Law Firm, 6 APC initiated this action by filing a Complaint against Defendants Darren D. Chaker, an 7 individual and as trustee of Platinum Holdings Group Trust dba Counter Forensics; Vania 8 Chaker, an individual and as trustee of Vania Chaker Trust One; and Nicole Chaker, an 9 individual and as trustee of Nicole Chaker Trust One. (ECF No. 1). Plaintiffs brought the 10 following three causes of action: (1) violation of Racketeer Influenced and Corrupt 11 Organizations Act (“RICO”), 18 U.S.C. §1962(c), against all Defendants; (2) violation of 12 RICO, 18 U.S.C. § 1962(d), against all Defendants; and (3) civil extortion against 13 Defendants Darren Chaker and Nicole Chaker. See id. at 32-37. Plaintiffs sought 14 injunctive relief; compensatory, treble, punitive, and exemplary damages; attorneys’ fees; 15 costs; pre-judgment interest and post-judgment interest; and “other and further relief as 16 the Court deems just and proper.” Id. at 38. 17 On August 30, 2016, Plaintiffs filed a Motion to File Documents Under Seal. (ECF 18 No. 5). Plaintiffs requested to file under seal documents “which contain[] confidential 19 personal information of third parties and other confidential documents.” Id. at 2. 20 Specifically, Plaintiffs requested to file the following five documents under seal: (1) 21 Opposition to Application for Reissuance of Request for Order (Exhibit 2); (2) Letter from 22 Chaker to McMillan (Exhibit 4); (3) Declaration of Petitioner (Exhibit 5); (4) Declaration 23 of Respondent (Exhibit A); and (5) Email from Chaker to McMillan (Exhibit B). See id. 24 On September 1, 2016, the Court issued an Order denying the Motion to File Documents 25 Under Seal filed by Plaintiffs (ECF No. 5). (ECF No. 8). The Court stated that “Plaintiffs 26 may file an amended motion to file [ ] documents under seal on or before September 12, 27 2016.” Id. at 3. 28 1 On September 7, 2016, Plaintiffs filed an Amended Motion to File Documents 2 Under Seal. (ECF No. 10). Plaintiffs requested to file the same five documents under seal 3 as previously requested in the original Motion to File Documents Under Seal (ECF No. 5) 4 because the documents “contain confidential personal information of third parties.” See 5 ECF No. 10 at 4. On September 14, 2016, the Court issued an Order granting the 6 Amended Motion to File Documents Under Seal filed by Plaintiffs (ECF No. 10). (ECF 7 No. 12). 8 On November 14, 2016, Defendant Darren Chaker filed a Motion to Dismiss 9 Plaintiffs’ Complaint for failure to state a claim upon which relief can be granted pursuant 10 to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 14). On November 15, 2016, 11 Defendant Darren Chaker filed a Motion to Change Venue. (ECF No. 15). On the same 12 day, Defendant Darren Chaker filed a Motion to Dismiss Plaintiffs’ Complaint pursuant 13 to California’s Anti-SLAPP Statute. (ECF No. 16). 14 On December 5, 2016, Plaintiffs filed an Amended Complaint against Defendants 15 Darren Chaker, an individual and as trustee of Platinum Holdings Group Trust dba 16 Counter Forensics; Vania Chaker, an individual and as beneficiary of The Island 17 Revocable Trust under Declaration of Trust dated June 2, 2015; Marcus Mack, as trustee 18 of The Island Revocable Trust under Declaration of Trust dated June 2, 2015; and Nicole 19 Chaker, an individual and as trustee of the Nicole Chaker Revocable Living Trust, U/A 20 dated August 18, 2010. (ECF No. 25). Plaintiffs brought the following three causes of 21 action: (1) violation of RICO, 18 U.S.C. §1962(c), against Defendant Darren Chaker; (2) 22 violation of RICO, 18 U.S.C. § 1962(d), against all Defendants; and (3) civil extortion 23 against Defendants Darren Chaker and Nicole Chaker. See id. at 33-46. Plaintiffs sought 24 injunctive relief; compensatory, treble, punitive, and exemplary damages; attorneys’ fees; 25 costs; pre-judgment interest and post-judgment interest; and “other and further relief as 26 the Court deems just and proper.” Id. at 47. 27 28 1 On December 16, 2016, Defendant Nicole Chaker filed a Motion to Strike and a 2 Motion to Dismiss Plaintiffs’ third cause of action of the Amended Complaint pursuant to 3 California Code of Civil Procedure§ 425.15(b). (ECF No. 36). 4 On January 23, 2017, the Court issued an Order denying as moot the Motions to 5 Dismiss filed by Defendant Darren Chaker (ECF Nos. 14, 16). (ECF No. 46). 6 On February 17, 2017, Defendant Darren Chaker filed a Motion to Strike portions 7 of the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(f). (ECF No. 8 55). On the same day, Defendant Darren Chaker filed a Motion to Dismiss Plaintiffs’ 9 Amended Complaint for failure to state a claim upon which relief can be granted pursuant 10 to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 56). 11 On the same day, the Court issued an Order denying the Motion to Change Venue 12 filed by Defendant Darren Chaker (ECF No. 15). (ECF No. 57). 13 On March 3, 2017, Defendant Vania Chaker filed a Motion to Dismiss Plaintiffs’ 14 Amended Complaint for insufficient service of process pursuant to Federal Rule of Civil 15 Procedure 12(b)(5) or, in the alternative, to Quash Defective Service. (ECF No. 59). On 16 March 28, 2017, Defendant Darren Chaker filed a Motion for Sanctions pursuant to 17 Federal Rule of Civil Procedure 11. (ECF No. 66). 18 On May 22, 2017, Defendant Darren Chaker filed a Motion to Seal. (ECF No. 78). 19 Defendant Darren Chaker requested to seal Exhibit FF to Plaintiffs’ Complaint and 20 Amended Complaint because Exhibit FF “contains private, personal, and confidential 21 information . . . and potentially exposes [Defendant] Darren [Chaker] to identity theft.” 22 (ECF No. 78-1 at 5). Defendant Darren Chaker further requested to seal Exhibit C to 23 Plaintiffs’ Response in opposition to Defendant Darren Chaker’s Motion for Sanctions 24 because Exhibit C “has personal information . . . .” Id. 25 On August 28, 2017, the Order issued an Order stating, in relevant part, 26 IT IS HEREBY ORDERED that Defendant Darren Chaker’s motion to dismiss the First Amended Complaint is granted. (ECF No. 56). The First 27 Amended Complaint (ECF No. 25) is dismissed without prejudice as to 28 Defendant Darren Chaker. Accordingly, Defendant Darren Chaker’s motion 1 to strike portions of the First Amended Complaint pursuant to Federal Rule of Civil Procedure 12(f) is denied as moot. (ECF No. 55). 2

3 IT IS HEREBY ORDERED that Defendant Darren Chaker’s motion for sanctions is denied. (ECF No. 66)[.] 4

5 IT IS HEREBY ORDERED that Defendant Nicole Chaker’s motion to dismiss the First Amended Complaint is granted. (ECF No. 35). The First 6 Amended Complaint (ECF No. 25) is dismissed without prejudice as to 7 Defendant Nicole Chaker. Defendant Nicole Chaker’s anti-SLAPP motion to strike and for attorneys’ fees and costs is denied as moot. (ECF No. 36). 8

9 IT IS HEREBY ORDERED that Defendant Vania Chaker’s motion to quash the service of process is granted. (ECF No. 59). The Court quashes 10 service upon Defendant Vania Chaker and grants Plaintiffs sixty (60) days 11 from the date any amended complaint is filed upon which to perfect service upon Vania Chaker in accordance with the requirements of Federal Rule of 12 Civil Procedure 4. 13 IT IS FURTHER ORDERED that the First Amended Complaint (ECF 14 No. 25) is dismissed without prejudice as to Defendant Vania Chaker. 15 Plaintiffs shall file any motion for leave to file an amended complaint pursuant to Local Rule 7.1 and within thirty (30) days of the date this Order 16 is issued. 17 (ECF No. 83 at 15-16). 18 On October 2, 2017, the Court issued an Order stating, in relevant part, 19 IT IS HEREBY ORDERED that the motion [to seal] is GRANTED with 20 respect to the request to seal and denied as to all other requests. (ECF No. 21 78). The Clerk of Court shall seal the following previously filed documents: (1) Exhibit FF to the Original Complaint (ECF No. 1-30); (2) Exhibit FF to 22 the First Amended Complaint (ECF No. 25-29); (3) Exhibit C attached to the 23 declaration of Plaintiff Scott McMillan in support of his opposition to Defendant’s motion for sanctions (ECF No. 75-1 at 121-141); and, (4) 24 Exhibits 1, 2, 4, 5, 6, 7, and 8 attached to Plaintiffs’ response in opposition 25 to the motion to seal (ECF Nos. 80-2, 80-3, 80-5, 80-6, 80-7, 80-8, 80-9).

26 (ECF No. 84 at 5). 27 28 1 On October 10, 2017, the Court issued an Order directing the Clerk of the Court to 2 close the case. (ECF No. 86). 3 On November 5, 2017, Plaintiffs filed a Notice of Appeal as to the Court’s October 4 10, 2017 Order (ECF No. 86) and “the prior adverse rulings.” (ECF No. 87 at 2). 5 On December 12, 2017, Defendant Nicole Chaker filed a Motion for Extension of 6 Time to File a Cross-Appeal pursuant to Federal Rule of Appellate Procedure 4(a)(5). 7 (ECF No. 90). On March 8, 2018, the Court issued an Order granting the Motion for 8 Extension of Time to File a Cross-Appeal filed by Defendant Nicole Chaker (ECF No. 9 90). (ECF No. 99). 10 On March 13, 2018, Defendant Nicole Chaker filed a Notice of Cross-Appeal as to 11 the Court’s August 28, 2017 Order (ECF No. 83) and the Court’s October 10, 2017 Order 12 (ECF No. 86). (ECF No. 101). On March 16, 2018, Plaintiffs filed a Notice of Cross- 13 Appeal as to the Court’s March 8, 2018 Order (ECF No. 99) and “the prior adverse 14 rulings.” (ECF No. 102 at 2). 15 On February 18, 2020, the Court of Appeals affirmed this Court’s rulings. (ECF 16 No. 117). 17 On June 25, 2020, Defendant Darren Chaker filed a Motion to File Documents 18 Under Seal. (ECF No. 118).1 On July 20, 2020, Plaintiffs filed a Response in opposition. 19 (ECF No. 123). The record reflects that no Reply has been filed. 20 STANDARD OF REVIEW 21 “[C]ourts of this country recognize a general right to inspect and copy public 22 records and documents, including judicial records and documents.” Ctr. for Auto Safety 23 v. Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016) (quoting Nixon v. Warner 24 Commc'ns, Inc., 435 U.S. 589, 597 (1978)). Courts “start with a strong presumption in 25

26 1 Defendant Darren Chaker requests judicial notice of the June 29, 2018 minute order entered in Scott A. 27 McMillan v. Darren D. Chaker, et. al., No. 37-2017-00036344-CU-NP-CTL (Ex. C to Bravo Decl., ECF No. 118-2 at 92-94). See ECF No. 118-3. The Court has not considered this minute order in resolving 28 1 favor of access to court records” “based on the need for federal courts, although 2 independent—indeed, particularly because they are independent—to have a measure of 3 accountability and for the public to have confidence in the administration of justice.” Id. 4 “[A] party seeking to seal a judicial record then bears the burden of overcoming this 5 strong presumption by meeting the ‘compelling reasons’ standard.” Id. (quoting 6 Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)). “That is, 7 the party must articulate[ ] compelling reasons supported by specific factual findings, . . . 8 that outweigh the general history of access and the public policies favoring disclosure, 9 such as the public interest in understanding the judicial process.” Kamakana, 447 F.3d at 10 1178-79 (first alteration in original) (citation omitted). The presumed right to access to 11 court proceedings and documents can be overcome “only by an overriding right or interest 12 based on findings that closure is essential to preserve higher values and is narrowly 13 tailored to serve that interest.” Oregonian Pub. Co. v. U.S. Dist. Court for Dist. of Oregon, 14 920 F.2d 1462, 1465 (9th Cir. 1990). The Court of Appeals in Chrysler stated, in relevant 15 part, 16 Under this stringent standard, a court may seal records only when it finds “a compelling reason and articulate[s] the factual basis for its ruling, without 17 relying on hypothesis or conjecture.” . . . The court must then “conscientiously 18 balance[ ] the competing interests of the public and the party who seeks to keep certain judicial records secret.” . . . What constitutes a “compelling 19 reason” is “best left to the sound discretion of the trial court.” . . . Examples 20 include when a court record might be used to “gratify private spite or promote public scandal,” to circulate “libelous” statements, or “as sources of business 21 information that might harm a litigant’s competitive standing.” 22 Chrysler, 809 F.3d at 1096-97 (first and third alterations in original) (citations omitted) 23 (first quoting Kamakana, 447 F.3d at 1179, then quoting Nixon, 435 U.S. at 599). 24 DISCUSSION 25 Defendant Darren Chaker requests to seal portions of the Complaint (ECF No. 1) 26 and Amended Complaint (ECF No. 25) which “include reference to a California sealed 27 paternity case . . . involving Defendant Darren [] Chaker [ ].” (ECF No. 118-1 at 2) 28 1 |](emphasis omitted). Specifically, Defendant Darren Chaker requests to seal paragraphs 2 ||39, 40, and 49 of the Complaint (ECF No. 1) and paragraphs 40, 41, and 50 of the 3 || Amended Complaint (ECF No. 25). See id. Plaintiffs contend that there is no compelling 4 ||reason to seal paragraphs 39, 40, and 49 of the Complaint (ECF No. 1) and paragraphs 40, 5 ||41, and 50 of the Amended Complaint (ECF No. 25). Plaintiffs assert that the paragraphs 6 ||contain allegations against Defendant Darren Chaker regarding extortion and do not 7 || contain records from or confidential information about the paternity case. Plaintiffs assert 8 the paragraphs only mention the existence of the paternity case itself and that Plaintiff 9 || was an attorney in that matter. Plaintiffs contend that the paragraphs were not filed for an 10 ||improper purpose. 11 In this case, Defendant Darren Chaker “bears the burden of overcoming th[e] strong 12 || presumption [in favor of access to court records] by meeting the ‘compelling reasons’ 13 standard.” Chrysler, 809 F.3d at 1096 (quoting Kamakana, 447 F.3d at 1178). The Court 14 || concludes that Defendant Darren Chaker fails to overcome the strong presumption in favor 15 || of public access with respect to the allegations of Plaintiffs’ Complaint (ECF No. 1) and 16 || Amended Complaint (ECF No. 25). 17 CONCLUSION 18 IT IS HEREBY ORDERED that the Motion to File Documents Under Seal filed by 19 || Defendant Darren D. Chaker (ECF No. 118) is DENIED. 20 || Dated: August 14, 2020 BME: Me Z. A a 21 Hon. William Q. Hayes United States District Court 23 24 25 26 27 28