Peter Schuman v. Microchip Technology Incorporated

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 PETER SCHUMAN, et al., Case No. 16-cv-05544-HSG 8 Plaintiffs, ORDER GRANTING MOTION TO SEAL 9 v. Re: Dkt. No. 138 10 MICROCHIP TECHNOLOGY INCORPORATED, et al., 11 Defendants. 12 13 Pending before the Court is the parties’ administrative motion to file under seal documents 14 in support of Plaintiffs’ motion for summary judgment. Dkt. No. 138. The Court GRANTS the 15 motion for the reasons detailed below. 16 I. LEGAL STANDARD 17 Courts generally apply a “compelling reasons” standard when considering motions to seal 18 documents. Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 678 (9th Cir. 2010) (quoting Kamakana 19 v.City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)). “This standard derives from the 20 common law right ‘to inspect and copy public records and documents, including judicial records 21 and documents.’” Id. (quoting Kamakana, 447 F.3d at 1178). “[A] strong presumption in favor of 22 access is the starting point.” Kamakana, 447 F.3d at 1178 (quotations omitted). To overcome this 23 strong presumption, the party seeking to seal a judicial record attached to a dispositive motion 24 must “articulate compelling reasons supported by specific factual findings that outweigh the 25 general history of access and the public policies favoring disclosure, such as the public interest in 26 understanding the judicial process” and “significant public events.” Id. at 1178–79 (quotations 27 omitted). “In general, ‘compelling reasons’ sufficient to outweigh the public’s interest in 1 vehicle for improper purposes,’ such as the use of records to gratify private spite, promote public 2 scandal, circulate libelous statements, or release trade secrets.” Id. at 1179 (quoting Nixon v. 3 Warner Commc’ns, Inc., 435 U.S. 589, 598 (1978)). “The mere fact that the production of records 4 may lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will not, 5 without more, compel the court to seal its records.” Id. 6 The Court must “balance[] the competing interests of the public and the party who seeks to 7 keep certain judicial records secret. After considering these interests, if the court decides to seal 8 certain judicial records, it must base its decision on a compelling reason and articulate the factual 9 basis for its ruling, without relying on hypothesis or conjecture.” Id. Civil Local Rule 79-5 10 supplements the compelling reasons standard set forth in Kamakana: the party seeking to file a 11 document or portions of it under seal must “establish[] that the document, or portions thereof, are 12 privileged, protectable as a trade secret or otherwise entitled to protection under the law . . . The 13 request must be narrowly tailored to seek sealing only of sealable material.” Civil L.R. 79-5(b). 14 Records attached to nondispositive motions must meet the lower “good cause” standard of 15 Rule 26(c) of the Federal Rules of Civil Procedure, as such records “are often unrelated, or only 16 tangentially related, to the underlying cause of action.” See Kamakana, 447 F.3d at 1179–80 17 (quotations omitted). This requires a “particularized showing” that “specific prejudice or harm 18 will result” if the information is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 19 307 F.3d 1206, 1210–11 (9th Cir. 2002); see also Fed. R. Civ. P. 26(c). “Broad allegations of 20 harm, unsubstantiated by specific examples of articulated reasoning” will not suffice. Beckman 21 Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470, 476 (9th Cir. 1992) (quotation omitted). 22 II. DISCUSSION 23 Because the parties seek to seal portions of filings and documents which pertain to 24 Plaintiffs’ motion for summary judgment, the Court applies the compelling reasons standard. 25 The parties seek to seal documents which contain information about the benefits 26 Defendants may have gained by retaining severance funds that were not paid to Plaintiffs. 27 Defendants submitted their Rule 79-5 supporting declaration establishing that the documents 1 and investment strategy, and that disclosure of the information would cause irreparable harm to 2 || Defendants by providing an unfair advantage to Microchip’s competitors. Dkt. No. 140. 3 The Court did not rely on any of the documents that are the subject of the administrative 4 || motion to seal, given that the parties agreed that the Court should terminate the motions for 5 summary judgment. See Dkt. No. 156. Thus, these documents are unrelated to the public’s 6 || understanding of the judicial proceedings in this case, and the public’s interest in disclosure of 7 || these documents is minimal given that the Court will not rule on the motion for summary 8 || judgment to which these documents were attached. See In re iPhone Application Litig., No. 11- 9 MD-02250-LHK, 2013 WL 12335013, at *2 (N.D. Cal. Nov. 25, 2013) (“The public’s interest in 10 accessing these documents is even further diminished in light of the fact that the Court will not 11 have occasion to rule on Plaintiffs’ Motion for Class Certification.”). Accordingly, because the 12 || documents divulge proprietary and confidential information unrelated to the public’s 5 13 understanding of the judicial proceedings in this action, the Court finds that there are compelling 14 reasons to file the documents under seal. See Economus vy. City & Cty. of San Francisco, No. 18- 3 15 CV-01071-HSG, 2019 WL 1483804, at *9 (N.D. Cal. Apr. 3, 2019) (finding compelling reason to 16 seal because the sealing request divulges sensitive information no longer related to the case); In re 3 17 iPhone, 2013 WL 12335013 (same); Doe v. City of San Diego, No. 12-CV-689-MMA-DHB, 2014 18 || WL 1921742, at *4 (S.D. Cal. May 14, 2014) (exhibit’s disclosure of personal information and 19 irrelevance to the matter are compelling reasons to seal the exhibit). 20 || Il. CONCLUSION 21 The Court GRANTS the parties’ administrative motion to file under seal. Pursuant to 22 Civil Local Rule 79-5(f)(1), documents filed under seal as to which the administrative motions are 23 granted will remain under seal. 24 IT IS SO ORDERED. 25 || Dated: 9/29/2021 26 Alauperl § 7 HAYWOOD S. GILLIAM, JR. United States District Judge 28