United States District Court, N.D. California, San Jose Division
ORDER DENYING MOTION TO SEAL WITHOUT PREJUDICE RE:
DKT. NO. 65
H. KOH UNITED STATES DISTRICT JUDGE
25, 2019, Defendants Midland Funding, LLC and Midland Credit
Management, Inc. (collectively, the “Midland
Defendants”) filed a Motion to Compel Arbitration. ECF
No. 42 Defendants Hunt & Henriques
(“H&H”), Michael Scott Hunt, and Janalie Ann
Henriques (collectively, the “H&H
Defendants”) joined in that motion on July 22, 2019.
ECF No. 52. On the same day, the H&H Defendants also
filed their own Motion to Compel Arbitration. ECF No. 51
(“H&H Def. Mot. to Compel”). In connection
with their respective Motions to Compel Arbitration, the
Midland Defendants and the H&H Defendants filed redacted
versions of several documents as exhibits. On August 19,
2019, the Court ordered Defendants to file a motion to seal,
for parties are not permitted to unilaterally redact their
filings. ECF No. 64.
to the Court’s order, the Midland Defendants filed an
Administrative Motion to Seal on August 22, 2019. ECF No. 65.
This order is now before the Court. Specifically, the Midland
Defendants seek to seal portions of two documents: (1) the
Purchase and Sale Agreement attached as Exhibit A to the
Declaration of Sean Mulcahy, ECF No. 42-1, Ex. C, and (2) the
Bill of Sale attached as Exhibit B to the Declaration of Sean
Mulcahy, id., and as Exhibit 2 to the Declaration of
William Peck, ECF. No. 42-1, Ex. B.
courts have recognized a ‘general right to inspect and
copy public records and documents, including judicial records
and documents.’” Kamakana v. City & Cty.
of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)
(quoting Nixon v. Warner Commc’ns, Inc., 435
U.S. 589, 597 & n.7 (1978)). Accordingly, when
considering a sealing request, “a strong presumption in
favor of access is the starting point.” Id.
(internal quotation marks omitted).
seeking to seal judicial records relating to dispositive
motions bear the burden of overcoming the presumption with
“compelling reasons supported by specific factual
findings that outweigh the general history of access and the
public policies favoring disclosure.”
Kamakana, 447 F.3d at 1178–79 (internal
quotation marks and citation omitted). Compelling reasons
justifying the sealing of court records generally exist
“when such ‘court files might have become a
vehicle for improper purposes, ’ such as the use of
records to gratify private spite, promote public scandal,
circulate libelous statements, or release trade
secrets.” Id. at 1179 (quoting Nixon,
435 U.S. at 598). However, “[t]he mere fact that the
production of records may lead to a litigant’s
embarrassment, incrimination, or exposure to further
litigation will not, without more, compel the court to seal
its records.” Id.
contrast, records attached to non-dispositive motions
generally are not subject to the strong presumption of
access, provided those motions are “not related, or
only tangentially related, to the merits of a case.”
Ctr. for Auto Safety, 809 F.3d at 1099; see also
Kamakana, 447 F.3d at 1179 (“[T]he public has less
of a need for access to court records attached only to
non-dispositive motions because those documents are often
unrelated, or only tangentially related, to the underlying
cause of action.” (internal quotation marks and
citation omitted)). Parties moving to seal records attached
to motions unrelated or only tangentially related to the
merits of a case need only meet the lower “good
cause” standard of Rule 26(c) of the Federal Rules of
Civil Procedure. Ctr. for Auto Safety, 809 F.3d at
1098–99; Kamakana, 447 F.3d at 1179–80.
Still, the “good cause” standard requires a
“particularized showing” that “specific
prejudice or harm will result” if the information is
disclosed. Phillips ex rel. Estates of Byrd v. Gen.
Motors Corp., 307 F.3d 1206, 1210–11 (9th Cir.
2002) (citation omitted); see Fed. R. Civ. P. 26(c).
“Broad allegations of harm, unsubstantiated by specific
examples or articulated reasoning” will not suffice.
Beckman Indus., Inc. v. Int’l Ins. Co., 966
F.2d 470, 476 (9th Cir. 1992) (citation omitted).
determine which standard applies to the Midland
Defendants’ Administrative Motion to
Seal-“compelling reasons” or “good
cause”-the Court must first determine whether the
underlying Motion to Compel Arbitration is a dispositive or
non-dispositive motion for sealing purposes. The Ninth
Circuit has not ruled on this issue, nor has it provided
clear guidance on distinguishing dispositive and
non-dispositive motions generally. Martin v. Wells Fargo
Bank, N.A., No. CV 12–0630–SI, 2013 WL
5441973, at *6 (N.D. Cal. Sept. 30, 2013). In addition,
district courts in this circuit have disagreed as to whether
a motion to compel arbitration is a dispositive or
non-dispositive motion with regard to sealing. Compare
Golden Boy Promotions, Inc. v. Top Rank, Inc., No.
2:10-CV-01619-RLH, 2011 WL 686362, at *1 (D. Nev. Feb. 17,
2011) (“A motion to compel arbitration is a dispositive
motion.”), with Verinata Health, Inc. v. Ariosa
Diagnostics, Inc., No. 12-CV-05501-SI, 2015 WL 5117083,
at *4 (N.D. Cal. Aug. 31, 2015), aff’d, 830
F.3d 1335 (Fed. Cir. 2016) (“Because a motion to compel
arbitration is not dispositive, the ‘good cause’
standard applies.”). The Court need not venture into
this disagreement, however. Because the Midland Defendants
have conceded the “compelling reasons” standard
applies, see ECF No. 65 at 1, the Court applies it
district, in addition to meeting the applicable standard
under Kamakana, all parties requesting sealing must
comply with Civil Local Rule 79–5, including that
rule’s requirement that the request must
“establish . . . that the document, or portions
thereof, are privileged, protectable as a trade secret or
otherwise entitled to protection under the law.” Civ.
L.R. 79–5(b). The sealing request must also “be
narrowly tailored to seek sealing only of sealable
instant motion, the Midland Defendants’ request to seal
almost the entirety of both exhibits is clearly overbroad in
that it seeks to seal vast swaths of non-sealable material.
As a result, the request is not “narrowly tailored to
seek sealing only of sealable material, ” as mandated
by Civil Local Rule 79-5(b).
example, the redacted portions of the Purchase and Sale
Agreement encompass such items as definitions of generic
terms, introductory sentences, and form statements like
“Balance of Page Intentionally Left Blank.”
See, e.g., ECF No. 65-4 at 5-6, 9, 11, 18. In
addition, the unredacted portion of the Affidavit of Sale of
Account identifies the affiant as Terri Bergman, yet the
Midland Defendants seek to seal Terri Bergman’s
signature. ECF No. 65-4 at 3. None of these examples are
sealable under the law cited by the Midland Defendants.
See ECF No. 65 at 3-4. It is true that
“business strategy, ” TriQuint Semiconductor,
Inc. v. Avago Techs. Ltd., No. CV 09-1531-PHX-JAT, 2011
WL 6182346, at *3 (D. Ariz. Dec. 13, 2011), “financial
projections, ” Krieger v. Atheros Commc’ns,
Inc., No. 11-CV-00640-LHK, 2011 WL 2550831, at *1 (N.D.
Cal. June 25, 2011), and “confidential sales
data” about a company’s products, Bauer Bros.
LLC v. Nike, Inc., No. 09CV500-WQH-BGS, 2012 WL 1899838,
at *4 (S.D. Cal. May 24, 2012), have been found sealable by
courts. But much of the redacted material does not fall into
any of these categories of information. The Court encourages
the Midland Defendants to review Ninth Circuit law regarding
what is sealable in a commercial agreement. See,
e.g., In re Elec. Arts, Inc., 298 F.
App’x 568, 569 (9th Cir. 2008) (finding that
“pricing terms, royalty rates, and guaranteed minimum
payment terms” meet the compelling reasons standard for
more, the Midland Defendants’ claim that
confidentiality “is critical to Midland’s
continued business interests” is general and
conclusory, rather than particularized to each piece of
information sought to be sealed. “[C]onclusory
offerings do not rise to the level of ‘compelling
reasons’ sufficiently specific to bar the public access
to the documents.” Kamakana, 447 F.3d at 1182
(requiring a specific compelling reason for each redaction
rather than “a general category of privilege”).
the Midland Defendants’ Administrative Motion to Seal
is DENIED without prejudice. The Midland Defendants may
submit a renewed request to seal that is narrowly tailored to
seek sealing only of material that is sealable under
applicable case law. If the Midland Defendants choose to
refile their motion, it must be filed by October 11, 2019.