Nanometrics, Incorporated v. Optical Solutions, Inc.

CourtDistrict Court, N.D. California
DecidedJune 21, 2023
Docket5:18-cv-00417
StatusUnknown

This text of Nanometrics, Incorporated v. Optical Solutions, Inc. (Nanometrics, Incorporated v. Optical Solutions, 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
Nanometrics, Incorporated v. Optical Solutions, Inc., (N.D. Cal. 2023).

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 NANOMETRICS, INCORPORATED, et Lead Case No. 18-cv-00417-BLF al., Case No. 18-cv-03276-BLF 8 Plaintiffs, ORDER GRANTING IN PART AND 9 DENYING IN PART v. ADMINISTRATIVE MOTIONS TO 10 SEAL EXHIBITS TO DEFENDANT OPTICAL SOLUTIONS, INC., et al., NANOMETRICS, INC.’S MOTION 11 FOR SUMMARY JUDGMENT AND Defendants. PLAINTIFF OPTICAL SOLUTIONS, 12 OPTICAL SOLUTIONS INC.’S OPPOSITION TO MOTION INCORPORATED, FOR SUMMARY JUDGMENT 13 Plaintiff, [Re: ECF Nos. 138, 140, 142] 14 v. 15 NANOMETRICS INCORPORATED, 16 Defendant. 17

18 Before the Court are (1) Defendant Nanometrics, Inc.’s (“Nanometrics”) administrative 19 motion to file under seal exhibits in support of its motion for summary judgment, ECF No. 138; 20 (2) Plaintiff Optical Solutions, Inc.’s (“Optical”) administrative motion to consider whether to seal 21 exhibits in support of its opposition to Nanometrics’s motion for summary judgment, ECF No. 22 140; and (3) Nanometrics’s response to Optical’s administrative motion to consider whether to 23 seal exhibits, ECF No. 142.1 Having reviewed the parties’ submissions and applicable sealing 24 law, the Court GRANTS IN PART and DENIES IN PART the administrative motions. 25 26 1 Although Nanometrics is the plaintiff and Optical the defendant in the lead case of this 27 consolidated action, the Court refers to Optical as the plaintiff and Nanometrics the defendant in I. LEGAL STANDARD 1 “Historically, courts have recognized a ‘general right to inspect and copy public records 2 and documents, including judicial records and documents.’” Kamakana v. City & Cty. of 3 Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner Commc’ns, Inc., 435 4 U.S. 589, 597 & n.7 (1978)). Accordingly, when considering a sealing request, “a ‘strong 5 presumption in favor of access’ is the starting point.” Id. (quoting Foltz v. State Farm Mut. Auto. 6 Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). Parties seeking to seal judicial records relating to 7 motions that are “more than tangentially related to the underlying cause of action,” Ctr. for Auto 8 Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1099 (9th Cir. 2016), bear the burden of overcoming 9 the presumption with “compelling reasons supported by specific factual findings that outweigh the 10 general history of access and the public policies favoring disclosure.” Kamakana, 447 F.3d at 11 1178–79 (internal quotation marks and citation omitted). 12 Compelling reasons justifying the sealing of court records generally exist “when such 13 ‘court files might . . . become a vehicle for improper purposes,’” Kamakana, 447 F.3d at 1179 14 (quoting Nixon, 435 U.S. at 598), such as: “to gratify private spite, promote public scandal, 15 circulate libelous statements,” id.; to “release trade secrets,” id.; or “as sources of business 16 information that might harm a litigant's competitive standing,” Ctr. for Auto Safety, 809 F.3d at 17 1097 (quoting Nixon, 435 U.S. at 598–99). On the other hand, “[t]he mere fact that the production 18 of records may lead to a litigant’s embarrassment, incrimination, or exposure to further litigation 19 will not, without more, compel the court to seal its records.” Kamakana, 447 F.3d at 1179. 20 “Broad allegations of harm, unsubstantiated by specific examples or articulated reasoning” will 21 not suffice. Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (citation 22 omitted). And although a protective order sealing the documents during discovery may reflect a 23 court’s previous determination that good cause—a lower threshold than that required for finding a 24 compelling reason to seal—exists to keep the documents sealed, see Kamakana, 447 F.3d at 1179– 25 80, but a blanket protective order that allows the parties to designate confidential documents does 26 not provide sufficient judicial scrutiny to determine whether each particular document should 27 remain sealed. See Civ. L.R. 79-5(d)(1)(A) (“Reference to a stipulation or protective order that 1 allows a party to designate certain documents as confidential is not sufficient to establish that a 2 document, or portions thereof, are sealable.”). 3 In addition, the Local Rules of this Court require that all requests to seal be “narrowly 4 tailored to seek sealing only of sealable material.” Civ. L.R. 79-5(a). That is, the sealing motion 5 must include “a specific statement of the applicable legal standard and the reasons for keeping a 6 document under seal, including an explanation of: (i) the legitimate private or public interests that 7 warrant sealing; (ii) the injury that will result if sealing is denied; and (iii) why a less restrictive 8 alternative to sealing is not sufficient.” Id. at 79-5(c)(1). 9 II. DISCUSSION 10 The Court has reviewed the sealing motions. The basis of the parties’ requests is that the 11 information has been designated by Nanometrics as either “Highly Confidential – Attorneys’ Eyes 12 Only” or “Confidential” pursuant to the parties’ protective order. ECF No. 138 at 3; ECF No. 140 13 at 2; ECF No. 142 at 3. Nanometrics seeks to seal information related to its “research and 14 development, technical designs, and performance testing of its tools and their components.” ECF 15 No. 138-1 ¶ 4; ECF No. 142-1 ¶ 4. The documents at issue contain “valuable and sensitive trade 16 secret information,” including technical documentation and internal communications regarding the 17 performance of tools that Nanometrics asserts are not publicly disclosed or are only disclosed to 18 external entities subject to nondisclosure agreements, and in some instances are not disseminated 19 outside of key personnel within Nanometrics. See id. Nanometrics contends that the public 20 disclosure of this information could reveal to competitors information about its research and 21 development, and related strategic business decisions. ECF No. 138 at 4; ECF No. 142 at 3–4. 22 The Court finds that Nanometrics has established compelling reasons to seal information 23 that would reveal its research and development, technical designs, performance testing, and 24 business strategies. See, e.g., In re Elec. Arts, 298 F. App’x. 568, 569 (9th Cir. 2008) (finding 25 compelling reasons for sealing “business information that might harm a litigant’s competitive 26 strategy”); In re Google Location Hist. Litig., No. 5:18-cv-05062-EJD, 514 F. Supp. 3d 1147, 27 1162 (N.D. Cal. Jan. 25, 2021) (“Compelling reasons may exist to seal ‘trade secrets, marketing 1 information, internal reports[.]’”) (citation omitted); Simpson Strong-Tie Co. Inc. v. MiTek Inc., 2 No. 20-cv-06957-VKD, 2023 WL 350401, at *2–3 (N.D. Cal. Jan. 20, 2023) (granting sealing 3 request of “confidential business development and internal business strategy documents and 4 intellectual property of MiTek, including internal MiTek research and development information”). 5 However, the Court finds that several of the sealing requests are not narrowly tailored, and grants 6 in part and denies in part those requests. The Court's rulings on the sealing requests are set forth 7 in the table below: 8 Public ECF No. / Document to be Result Reasoning 9 (Sealed ECF No.) Sealed 10 139-2 / (138-2) Ex. 44 to Smith GRANTED. The portions of the document that Declaration in Support Nanometrics seeks to seal contain 11 of Nanometrics’s confidential analyses of the Motion for Summary performance of a product and a 12 Judgment third-party’s optical lens. See ECF (Highlighted portions) No. 138-1 ¶ 4.

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Nanometrics, Incorporated v. Optical Solutions, Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/nanometrics-incorporated-v-optical-solutions-inc-cand-2023.