Opinion
NOT TO BE PUBLISHED
Santa Clara County Super. Ct. No. CV031829.
Premo, J.
Plaintiff DVD Copy Control Association, Inc., has sued defendant Kaleidescape, Inc., for breach of a license contract. Within the action, defendant unsuccessfully moved to unseal documents in a civil case that plaintiff had maintained against others but dismissed with prejudice. Defendant appeals from the order denying its motion. We affirm the order.
BACKGROUND
“Digital versatile disks (DVD’s) are five-inch disks used to store large amounts of data in digital form. A single DVD may contain a full-length motion picture. Unlike motion pictures on videocassettes, motion pictures contained on DVD’s may be copied without perceptible loss of video or audio quality. This aspect of the DVD format makes it particularly susceptible to piracy. For this reason, motion pictures stored on DVDs have been protected from unauthorized use by a content scrambling system referred to as CSS. Simply put, CSS scrambles the data on the disk and then unscrambles it when the disk is played on a compliant DVD player or computer. CSS does not allow the content on the DVD to be copied. [Citation.] [¶] For obvious reasons, the motion picture industry desired to keep the CSS technology a secret. But to make DVD players and computer DVD drives that can unscramble and play a CSS-protected DVD, the manufacturers had to have the CSS ‘master keys’ and an understanding of how the technology works. In an attempt to keep CSS from becoming generally known, the industries agreed upon a restrictive licensing scheme and formed [plaintiff] to be the sole licensing entity for CSS. Under the CSS licensing scheme, each licensee receives a different master key to incorporate into its equipment and sufficient technical know how to permit the manufacture of a DVD-compliant device. All licensees must agree to maintain the confidentiality of CSS.” (DVD Copy Control Assn., Inc. v. Bunner (2004) 116 Cal.App.4th 241, 245-246.)
Defendant is a licensee who plaintiff alleges has breached the license contract by manufacturing a home theater product that copies the content of a DVD into the product for storage and playback.
In Bunner, plaintiff sued the defendants under California’s Uniform Trade Secrets Act (UTSA) seeking an injunction to prevent the defendants from using or publishing a computer program that incorporated plaintiff’s trade secrets and permitted users to override CSS. It filed the claimed trade secrets under seal pursuant to Code of Civil Procedure section 2019.210. And it ultimately dismissed the action with prejudice.
In 2000, when plaintiff filed the alleged trade secrets, the applicable code section was Code of Civil Procedure section 2019, subdivision (d). Section 2019.210 is identical to that section.
The issue in Bunner was the propriety of a preliminary injunction. (See also DVD Copy Control Assn., Inc. v. Bunner (2003) 31 Cal.4th 864.)
Defendant’s motion herein sought to unseal the alleged trade secrets on the basis of First Amendment concepts embodied in California Rules of Court, rules 2.550 and 2.551. Its underlying theory was that plaintiff’s dismissal of Bunner amounted to an adjudication that the alleged trade secrets were not, or were no longer, trade secrets.
In 2006, when defendant filed the motion, the applicable rules were California Rules of Court, rules 243.1 and 243.2. Rules 2.550 and 2.551 are identical to the former rules. Rule 2.550(d) reads as follows: “The court may order that a record be filed under seal only if it expressly finds facts that establish: [¶] (1) There exists an overriding interest that overcomes the right of public access to the record; [¶] (2) The overriding interest supports sealing the record; [¶] (3) A substantial probability exists that the overriding interest will be prejudiced if the record is not sealed; [¶] (4) The proposed sealing is narrowly tailored; and [¶] (5) No less restrictive means exist to achieve the overriding interest.” Rule 2.551(h)(2) allows a “party or member of the public” to move to unseal a record. Rule 2.551(h)(4) directs the court to consider the same factors that justified sealing when unsealing is in issue.
The trial court disagreed with the basis of the motion and theory. And we also disagree.
DISCUSSION
Code of Civil Procedure section 2019.210 states: “In any action alleging the misappropriation of a trade secret under the [UTSA], before commencing discovery relating to the trade secret, the party alleging the misappropriation shall identify the trade secret with reasonable particularity subject to any orders that may be appropriate under Section 3426.5 of the Civil Code.”
Civil Code section 3426.5 is part of the UTSA and states: “In an action under this title, a court shall preserve the secrecy of an alleged trade secret by reasonable means, which may include granting protective orders in connection with discovery proceedings, holding in-camera hearings, sealing the records of the action, and ordering any person involved in the litigation not to disclose an alleged trade secret without prior court approval.”
Thus, in actions initiated pursuant to the UTSA for misappropriation of trade secrets, the mere presence of claimed trade secrets carries a mandatory confidentiality requirement. (In re Providian Credit Card Cases (2002) 96 Cal.App.4th 292, 298.) This confidentiality requirement is not trumped by the sealed records rules because those rules “do not apply to records that are required to be kept confidential by law.” (Cal. Rules of Court, rule 2.550(a)(2).) Though an adverse adjudication in Bunner might have bound plaintiff under collateral estoppel principles for purposes of defendant’s motion, “[t]he effect of a judgment as a collateral estoppel is confined to issues actually litigated.” (7 Witkin, Cal. Procedure (4th ed. 1997) Judgment, § 354, p. 917.) Given that plaintiff voluntarily dismissed Bunner, it is axiomatic that the trade-secret claim was not actually litigated in Bunner. (Le Parc Community Assn. v. Workers’ Comp. Appeals Bd. (2003) 110 Cal.App.4th 1161, 1174; Rice v. Crow (2000) 81 Cal.App.4th 725, 736.)
DISPOSITION
The order denying defendant’s motion to unseal court record in a prior case is affirmed.
WE CONCUR:
Rushing, P.J., Elia, J.