NATERA, INC. v. NEOGENOMICS LABORATORIES, INC.

M.D. North Carolina

NATERA, INC. v. NEOGENOMICS LABORATORIES, INC.

CourtDistrict Court, M.D. North Carolina

DecidedApril 4, 2024

Docket1:23-cv-00629

StatusUnknown

This text of NATERA, INC. v. NEOGENOMICS LABORATORIES, INC. (NATERA, INC. v. NEOGENOMICS LABORATORIES, INC.) is published on Counsel Stack Legal Research, covering District Court, M.D. North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

NATERA, INC. v. NEOGENOMICS LABORATORIES, INC., (M.D.N.C. 2024).

Pincite

Opinion

oN a ‘ < 2 □ □ IN THE UNITED STATES DISTRICT CoURT □□□ FILED □□□ FOR THE MIDDLE DISTRICT OF NORTH CAROLINA APR O4 2024 □□ NA o\ amg □ TERA, INC., Geena) ON Oy Sen Plaintiff, —) ) v. ) 1:23-CV-629 ) NEOGENOMICS LABORATORIES, _ ) ING,, ) ) Defendant. ) MEMORANDUM OPINION AND ORDER Catherine C. Eagles, Chief District Judge. This matter is before the Court on numerous motions to seal directed to evidence that either the plaintiff, Natera, Inc., or the defendant, NeoGenomics Laboratories, Inc., contends is confidential business information. The motions are granted in part and denied in part as reflected in the chart appended to this Order. I. Public Notice Before sealing judicial records, the district court must give the public notice and a reasonable opportunity to challenge the request to seal. Va. Dept of State Police v. Wash. Post, 386 F.3d 567, 576 (4th Cir. 2004). Here, the public has had adequate notice of the motions to seal; the most recent motion, Doc. 195, has been on the docket since January 11, 2024, and the others have been docketed longer.! See Mears v. Atl. Se. Airlines, Inc.,

' After the Court denied Natera’s first motion to seal, Doc. 15, as overbroad and unsupported by evidence, Natera filed a motion for reconsideration on February 20, 2024. See Doc. 219 (order denying motion to seal); Doc. 221 (motion for reconsideration). The Court granted the motion

No. 12-CV-613, 2014 WL 5018907, at *2 (E.D.N.C. Oct. 7, 2014) (holding that the filing of a motion to seal provides adequate public notice and opportunity to be heard) (citing Jn

re Knight Publ’g Co., 743 F.2d 231, 235 (4th Cir. 1984)). No objections have been filed. II. Legal Standard The public has a qualified right of access to judicial records. Doe v, Pub. Citizen, 749 F.3d 246, 265 (4th Cir. 2014) [Doe I; M.G.M. ex rel. Mabe v. Keurig Green Mountain, Inc., No. 22-CV-36, 2022 WL 6170557, at *1 (M.D.N.C. Oct. 7, 2022). “Documents filed with the court are judicial records if they play a role in the adjudicative process or adjudicate substantive rights.” In re Application of the U.S. for an Ord. Pursuant to 18 U.S.C. Section 2703(D), 707 F.3d 283, 290 (4th Cir. 2013) (cleaned up) [2703(D) Order Application). The public right of access derives “from the First Amendment and the common- law tradition that court proceedings are presumptively open to public scrutiny.” Doe J, 749 F.3d at 265. The common law presumes a right of access to all judicial records and documents, but this presumption can be rebutted if “the public’s right of access is outweighed by competing interests.” Knight, 743 F.2d at 235, accord United States v. Doe, 962 F.3d 139, 145 (4th Cir. 2020) [Doe II]. The First Amendment right of access extends only to particular judicial records and documents and can only be restricted if there is a compelling governmental interest, Doe I, 749 F.3d at 266, or in limited

for reconsideration on March 18, Doc. 250, and will issue a ruling on the motion to seal at Doc. 15 in this Order. The public has had plenty of time to consider the motion for reconsideration as well as the others motions to seal.

circumstances, a compelling private interest. See Fortson v. Garrison Prop. and Cas. Ins. Co., No. 19-CV-294, 2022 WL 824802, at *2 n.1 (M.D.N.C. Mar. 18, 2022); Doe I, 962 F.3d at 147-48. The compelling interest must be “narrowly tailored,” and the moving party must present “specific reasons that justify restricting access to the information; conclusory assertions are not sufficient.” See Syngenta Crop Prot., LLC v. Willowood, LLC, No. 15-CV-274, 2017 WL 6001818, at *3 (M.D.N.C. Dec. 4, 2017) (cleaned up); see also Doe I, 749 F.3d at 270 (holding district court erred by relying on unsupported statements of potential reputational harm to moving party); Wash. Post, 386 F.3d at 575 (holding moving party must “present specific reasons in support of its position”). When a party asks to seal judicial records, the court “must determine the source of the right of access with respect to each document,” and then “weigh the competing interests at stake.” Wash. Post, 386 F.3d at 576 (cleaned up). The public right of access

to documents filed in connection with a preliminary injunction motion stems from the First Amendment. See, e.g., Bayer v. Cropscience Inc. v. Syngenta Crop Prot., LLC, 979 Supp. 2d 653, 656 (M.D.N.C. Oct. 17, 2013); RLI Ins. Co. v. Nexus Servs., Inc., No. 18-CV-66, 2018 WL 10602398, at *1 (W.D. Va. Oct. 30, 2018) (holding First Amendment access applies to “motion for preliminary injunction and its supporting memorandum, declarations, and exhibits”). Thus, a motion to seal must be supported by

a compelling governmental or private interest that is narrowly tailored. See discussion

supra, Additionally, there must be “a substantial probability that, in the absence of closure, the compelling interest will be harmed” and “no alternatives to closure will adequately protect the compelling interest.” Doe IZ, 962 F.3d at 146 (cleaned up).

Ill. Compelling Private Interest in Confidential Business Information In the appropriate case, “[t]he interest in preserving the confidentiality of sensitive business information” can override the public’s First Amendment right of access. Warner

y, Midland Funding, LLC, No. 18-CV-727, 2021 WL 3432556, at *7 (M.D.N.C. Aug. 5, 2021); Doe I, 749 F.3d at 269 (“A corporation may possess a strong interest in preserving the confidentiality of its proprietary and trade-secret information, which in turn may justify partial sealing of court records.”); see, e.g., Silicon Knights, Inc. v. Epic Games, Inc., No. 7-CV-275, 2011 WL 901958, at *2 (E.D.N.C. Mar. 15, 2011) (collecting cases); Hutton v. Hydra-Tech, Inc., No. 14-CV-888, 2018 WL 1363842, at *9 (M.D.N.C. Mar. 15, 2018). The court may seal “sources of business information that might harm a litigant’s competitive standing,” Nixon v. Warner Comme’ns, Inc., 435 U.S. 589, 598 (1978), including “confidential and proprietary commercial information” such as “highly sensitive financial and business information,” Silicon Knights, 2011 WL 901958, at *2, so long as the requirements for sealing are met. See discussion supra, at 2-3. Courts deciding motions to seal based on claims of confidential business information first decide “whether the party has shown that the information sought to be sealed is confidential.” Put Corp. v. R. J. Reynolds Tobacco Co., No, 22-CV-881, 2023 WL 3892482, at *2 (M.D.N.C, Jan. 9, 2023). If it has, the court evaluates whether disclosure would harm the party’s competitive standing or otherwise harm its business interests; whether the motion is narrowly tailored; and whether the interests in non- disclosure are compelling and heavily outweigh the public’s interest in access to the information. See Willowood, 2017 WL 6001818, at *3; Sims v. BB&T Corp., No. 15-CV-

732, 2018 WL 3466945, at *2 (M.D.N.C. July 18, 2018). In weighing these competing interests, courts consider, among other things, whether the public needs access to the evidence or briefing to understand the case and the degree of harm that disclosure would likely cause. See Willowood, 2017 WL 6001818, at *3; Huntley v. Crisco, No. 18-CV- 744, 2020 WL 9815384, at *2 (M.D.N.C. Sept. 25, 2020). Factual findings are required before sealing. See Ashcraft v.

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