Powersecure, Inc. v. Art Alger, Inc.

• Court: District Court, N.D. California
• Decided: December 10, 2020
• Docket: 4:19-cv-08002
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 POWERSECURE, INC., Case No. 19-cv-08002-HSG

8 Plaintiff, ORDER GRANTING MOTION FOR GOOD FAITH SETTLEMENT 9 v. DETERMINATION AND DENYING ADMINISTRATIVE MOTION TO FILE 10 ART ALGER, INC., UNDER SEAL 11 Defendant. Re: Dkt. No. 39 and Dkt. No. 42

12 13 Pending before the Court is the application for good faith settlement determination filed by 14 Defendant. Dkt. No. 39. Defendant seeks approval of a settlement agreement under which it 15 agrees to pay an unspecified amount in exchange for a dismissal of this action with prejudice. Id. 16 at 5. No opposition or response has been filed. In response to the Court’s order for supplemental 17 briefing specifying the settlement amount, Defendant filed an Administrative Motion to File 18 Under Seal and Supplemental Brief in which it specified the amount. Dkt. No. 42. For the 19 reasons below, the Court GRANTS the motion for good faith settlement determination and 20 DENIES the motion to file under seal. 21 I. BACKGROUND 22 Plaintiff’s ESS modules are custom configured large-capacity electrical energy production 23 and storage systems that are used to provide backup power in the event of a power outage. Dkt. 24 No. 1 (“Compl.”) ¶ 10. In June 2016, Plaintiff contracted with Defendant to assist in transporting 25 two such modules for installation at the Apple Campus Facility in Cupertino, California. Id. ¶ 11. 26 The written contract provided that Defendant would “[r]elocate (2) ESS modules from staging” 27 and would “take precautions” when performing its services. Id. 1 installation. Id. ¶ 12. After the employees first attempted to lift the ESS module off the ground, it 2 began to list to one side. Id. ¶ 13. Defendant’s employees lowered the module, attempted to 3 secure the module, and tried again. Id. On the second attempt, the module continued to list until 4 the straps securing the module severed and the module fell from its rigging and onto the concrete 5 floor. Id. After examining the module, Plaintiff determined that it had been damaged beyond 6 repair. Id. ¶ 14. On December 5, 2019, Plaintiff filed this lawsuit against Defendant for Breach of 7 Contract and Breach of Implied Covenant of Duty to Perform with Reasonable Care and claimed 8 damages of at least $693,648.00. Id. ¶¶ 17-27. 9 II. LEGAL STANDARD 10 In “an action in which it is alleged that two or more parties are joint tortfeasors or co- 11 obligors on a contract debt,” California Code of Civil Procedure Section 877.6 permits a court to 12 determine whether a settlement between the plaintiff and one or more defendants was made in 13 good faith. See Cal. C. Civ. Proc. § 877.6(a). “A determination by the court that the settlement 14 was made in good faith shall bar any other joint tortfeasor or co-obligor from any further claims 15 against the setting tortfeasor or co-obligor for equitable comparative contribution, or partial or 16 comparative indemnity, based on comparative negligence or comparative fault.” Cal. C. Civ. 17 Proc. § 877.6(c). 18 A settlement is made in good faith if it is within the reasonable range of the settling 19 tortfeasor’s share of liability for the plaintiff’s injuries, taking into account the facts and 20 circumstances of the particular case. See Tech-Bilt, Inc. v. Woodward-Clyde Associates, 38 Cal.3d 21 488, 499 (Cal. 1985). When determining whether a settlement has been entered into in good faith, 22 a court examines such factors as: (1) a rough approximation of the plaintiff’s total recovery and 23 the settlor’s proportionate liability; (2) the amount paid in settlement; (3) a recognition that a 24 settlor should pay less in settlement than if found liable after a trial; (4) the allocation of the 25 settlement proceeds among plaintiffs; (5) the settlor’s financial condition and insurance policy 26 limits, if any; and (6) evidence of any collusion, fraud, or tortious conduct between the settlor and 27 the plaintiffs aimed at making the non-settling parties pay more than their fair share. Id. 1 documents. Pintos v. Pac. Creditors Ass’n, 605 F.3d 665, 678 (9th Cir. 2010) (quoting Kamakana 2 v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)). “This standard derives from the 3 common law right ‘to inspect and copy public records and documents, including judicial records 4 and documents.’” Id. (quoting Kamakana, 447 F.3d at 1178). “[A] strong presumption in favor of 5 access is the starting point.” Kamakana, 447 F.3d at 1178 (quotations omitted). To overcome this 6 strong presumption, the party seeking to seal a judicial record attached to a dispositive motion 7 must “articulate compelling reasons supported by specific factual findings that outweigh the 8 general history of access and the public policies favoring disclosure, such as the public interest in 9 understanding the judicial process” and “significant public events.” Id. at 1178–79 (quotations 10 omitted). “In general, ‘compelling reasons’ sufficient to outweigh the public’s interest in 11 disclosure and justify sealing court records exist when such ‘court files might have become a 12 vehicle for improper purposes,’ such as the use of records to gratify private spite, promote public 13 scandal, circulate libelous statements, or release trade secrets.” Id. at 1179 (quoting Nixon v. 14 Warner Commc’ns, Inc., 435 U.S. 589, 598 (1978)). “The mere fact that the production of records 15 may lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will not, 16 without more, compel the court to seal its records.” Id. 17 Records attached to nondispositive motions must meet the lower “good cause” standard of 18 Rule 26(c) of the Federal Rules of Civil Procedure, as such records “are often unrelated, or only 19 tangentially related, to the underlying cause of action.” Id. at 1179–80 (quotations omitted). This 20 requires a “particularized showing” that “specific prejudice or harm will result” if the information 21 is disclosed. Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1210–11 (9th 22 Cir. 2002); see also Fed. R. Civ. P. 26(c). “Broad allegations of harm, unsubstantiated by specific 23 examples of articulated reasoning” will not suffice. Beckman Indus., Inc. v. Int’l Ins. Co., 966 24 F.2d 470, 476 (9th Cir. 1992) (quotation omitted). 25 III. DISCUSSION 26 A. The Settlement Satisfies The Requirements For A Good Faith Settlement 27 Having considered the relevant Tech-Bilt factors, the Court finds that the proposed 1 When considering the value of the case, Defendant’s settlement payment is well within the 2 || “ballpark” of its potential liability. Because there is no allocation in the Settlement; the settlor’s 3 financial condition and insurance are not at issue; and there is no evidence or accusation of 4 collusion, fraud, or tortious conduct; those factors do not bar a good faith determination. 5 Accordingly, the Court GRANTS the motion for good faith settlement determination. 6 B. Defendant Fails to Show Good Cause To File Settlement Amount Under Seal 7 Because Defendant moves to file documents related to a nondispositive motion, the Court 8 || will apply the lower good cause standard. Defendant seeks to file under seal the settlement 9 amount within the Supplemental Brief in Support of its Application for a Good Faith 10 || Determination. Dkt. No. 42-3. The only proffered justification is to protect the confidentiality of 11 records and information related to the executed settlement agreement between the parties. Dkt. 12 || No. 42 2:10-11. But Defendant does not detail any harm that will result if the settlement amount 5 13 is disclosed, and simply preferring to keep this information secret is not a legal justification. 14 || Defendant thus fails to make the required “particularized showing” that “specific prejudice or 3 15 harm will result” if the information is disclosed. Phillips, 307 F.3d at 1210-11. a 16 Accordingly, the Court DENIES Defendant’s administrative motion to file under seal. 17 |} Dkt. No. 42. 18 IV. CONCLUSION 19 The Court GRANTS the motion for good faith settlement determination and DENIES the 20 || administrative motion to file under seal. The Court DIRECTS Defendant to file public versions 21 of all documents for which the proposed sealing has been denied within seven days of this order. 22 || Defendant may also file a new motion to seal within seven days of this order according to the 23 || requirements discussed above. 24 IT IS SO ORDERED. 25 || Dated: 12/10/2020 26 Alayel 5 □□□ □□ HAYWOOD S. GILLIAM, JR. 27 United States District Judge 28