JBS Packerland, Inc. v. Phillips Cattle Co., Inc.

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 JBS PACKERLAND, INC., Case No. 24-cv-01299-BAS-MSB 12 Plaintiff, ORDER DENYING WITHOUT 13 v. PREJUDICE MOTION TO SEAL 14 COMPLAINT (ECF No. 3) 15 PHILLIPS CATTLE CO., INC., 16 Defendant.

17 18 19 Presently before the Court is Plaintiff JBS Packerland, Inc.’s Motion to Seal the 20 Complaint. (ECF No. 3.) The Court finds there may be compelling reasons to seal some 21 of the Complaint, but Plaintiff’s redactions are not narrowly tailored. Hence, for the 22 following reasons, the Court DENIES WITHOUT PREJUDICE the Motion to Seal. 23 I. Legal Standard 24 “[T]he courts of this country recognize a general right to inspect and copy public 25 records and documents, including judicial records and documents.” Nixon v. Warner 26 Commc’ns, Inc., 435 U.S. 589, 597 (1978). “Unless a particular court record is one 27 ‘traditionally kept secret,’ a ‘strong presumption in favor of access’ is the starting point.” 28 Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (citing Foltz v. 1 State Farm Mut. Auto Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003)). “The presumption 2 of access is ‘based on the need for federal courts, although independent—indeed, 3 particularly because they are independent—to have a measure of accountability and for the 4 public to have confidence in the administration of justice.’” Ctr. for Auto Safety v. Chrysler 5 Grp., LLC, 809 F.3d 1092, 1096 (9th Cir. 2016) (quoting United States v. Amodeo, 71 F.3d 6 1044, 1048 (2d Cir. 1995)). 7 A party seeking to seal a judicial record bears the burden of overcoming the strong 8 presumption of access. Foltz, 331 F.3d at 1135. The showing required to meet this burden 9 depends upon whether the documents to be sealed relate to a motion that is “more than 10 tangentially related to the merits of the case.” Ctr. for Auto Safety, 809 F.3d at 1102. When 11 the underlying motion is more than tangentially related to the merits, the “compelling 12 reasons” standard applies. Id. at 1096–98. When the underlying motion does not surpass 13 the tangential relevance threshold, the “good cause” standard applies. Id. An action’s 14 complaint, and its associated exhibits, are more than tangentially related to the merits of 15 the case. Id. at 1098. Similarly, a party’s opposition to a motion to dismiss is more than 16 tangentially related to the merits of the case. Ctr. for Auto Safety, 809 F.3d at 1098. 17 “In general, ‘compelling reasons’ sufficient to outweigh the public’s interest in 18 disclosure and justify sealing court records exist when such ‘court files might have become 19 a vehicle for improper purposes,’ such as the use of records to gratify private spite, promote 20 public scandal, circulate libelous statements, or release trade secrets.” Kamakana, 447 21 F.3d at 1179 (quoting Nixon, 435 U.S. at 598). As to this last category, courts have been 22 willing to seal court filings containing confidential business material, “such as marketing 23 strategies, product development plans, licensing agreements, and profit, cost, and margin 24 data,” where the parties have been able to point to concrete factual information to justify 25 sealing. See, e.g., Cohen v. Trump, No. 13-cv-2519-GPC-WVG, 2016 WL 3036302, at *5 26 (S.D. Cal. May 27, 2016). However, “[t]he mere fact that the production of records may 27 lead to a litigant’s embarrassment, incrimination, or exposure to further litigation will not, 28 without more, compel the court to seal its records.” Kamakana, 447 F.3d at 1179. A 1 blanket protective order is not itself sufficient to show “good cause,” let alone compelling 2 reasons, for sealing particular documents. See Foltz, 331 F.3d at 1133; San Jose Mercury 3 News, Inc. v. U.S. Dist. Ct., N. Dist., 187 F.3d 1096, 1103 (9th Cir. 1999). The decision to 4 seal documents is “one best left to the sound discretion of the trial court” upon 5 consideration of “the relevant facts and circumstances of the particular case.” Nixon, 435 6 U.S. at 599. 7 In addition, parties moving to seal documents must comply with the procedures set 8 forth in this Court’s standing order for filing documents under seal. See Standing Order of 9 the Hon. Cynthia Bashant for Civil Cases ¶ 5. The rule permits sealing of “only those 10 documents, or portions thereof, necessary to protect such sensitive information.” Id. Thus, 11 although sometimes it may be appropriate to seal a document in its entirety, whenever 12 possible, a party must redact the document appropriately. See Kamakana, 447 F.3d at 1183 13 (noting a preference for redactions so long as they “have the virtue of being limited and 14 clear”); Murphy v. Kavo Am. Corp., No. 11–cv–00410–YGR, 2012 WL 1497489, at *2–3 15 (N.D. Cal. Apr. 27, 2012) (denying motion to seal exhibits but directing parties to redact 16 confidential information). 17 II. ANALYSIS 18 Plaintiff seeks to seal all the Complaint’s factual allegations but publicly reveal the 19 causes of action. (See Compl. ¶¶ 5–18.) Plaintiff argues these allegations cite to contracts 20 between the parties that contain commercially sensitive information. (Mot. 3.) Further, 21 Plaintiff highlights that the parties agreed in their contracts to keep the terms of them 22 confidential. (Id.) 23 Plaintiff’s sealing request is overbroad. At the threshold, the compelling reasons 24 standard applies to Plaintiff’s Motion because the Complaint is the cornerstone of the case. 25 E.g., Pardi v. Tricida, Inc., No. 21-CV-00076-HSG, 2023 WL 6165694, at *2 (N.D. Cal. 26 Sept. 21, 2023) (applying the compelling reasons standard to a motion to seal portions of 27 the complaint). Further, the Court’s standing order notes: “[t]he fact that both sides agree 28 to seal a document or that a stipulated protective order was issued is insufficient cause for 1 ||sealing.” Standing Order § 5.a. Hence, Plaintiff's analogous reliance on confidentiality 2 provisions in the underlying contracts is not enough to justify sealing portions of the 3 || Complaint. 4 In addition, although there may be commercially sensitive information in the 5 ||contracts, Plaintiff's proposed redactions are overbroad. This breach of contract action 6 || cannot be litigated in secrecy. The public has the right to know the gist of the underlying 7 ||contracts in order to understand this Court’s rulings. At the same time, the Court 8 ||recognizes that sensitive pricing information and other terms of the contracts may be 9 ||subject to sealing under the compelling reasons standard. See Fed. Trade □□□□□□ y. 10 || Qualcomm, Inc., No. 17-cv-00220-LHK, 2019 WL 95922, at *3 (N.D. Cal. Jan. 3, 2019) 11 (finding compelling reasons for “information that, if published, may harm [a party’s] or 12 || third parties’ competitive standing and divulges terms of confidential contracts, contract 13 |/negotiations, or trade secrets’). Plaintiffs redactions go beyond this information. 14 || Therefore, the Court will deny without prejudice Plaintiff's Motion and allow it the 15 ||} opportunity to propose more narrowly tailored redactions to the Complaint. 16 CONCLUSION 17 For the foregoing reasons, the Court DENIES WITHOUT PREJUDICE Plaintiffs 18 || Motion to Seal the Complaint (ECF No. 3). If Plaintiff wishes to renew its sealing request, 19 || Plaintiff must file an Amended Motion to Seal with a proposed redacted version of the 20 ||Complaint. The redactions must be narrowly tailored to protect sensitive pricing terms or 21 || other information that may harm Plaintiff's competitive standing. Further, as required by 22 ||this Court’s standing order, Plaintiff must support its Amended Motion to Seal with a 23 || declaration from a competent witness. Any Amended Motion to Seal must be filed no later 24 October 4, 2024. 25 IT IS SO ORDERED. 26 /\ yy 27 || DATED: September 23, 2024 asf rd A Haha, 6 28 United States District Judge -4- 24cv1299