Summary
granting motion to seal "specific customer names and the percentage of business to those customers"
Summary of this case from Sumotext Corp. v. Zoove, Inc.Opinion
Case No. 14-cv-02864-JD
08-02-2016
JOHNSTECH INTERNATIONAL CORP., Plaintiff, v. JF MICROTECHNOLOGY SDN BHD, Defendant.
ORDER ON MOTIONS TO SEAL RE SUMMARY JUDGMENT AND SANCTIONS
Re: Dkt. Nos. 113, 116, 117, 131, 144
In this patent action, plaintiff Johnstech International Corp. ("Johnstech") and defendant JF Microtechnology SDN BHD ("JFM") have filed several administrative motions to seal portions of their summary judgment and sanctions briefing under Civil Local Rule 79-5. The Court grants and denies the requests as detailed in this order.
I. STANDARDS
In our circuit, a party seeking to seal documents filed in connection with a dispositive motion must establish "compelling reasons" to overcome a historically "strong presumption of access to judicial records." Kamakana v. City and County of Honolulu, 447 F.3d 1172, 1178-79 (9th Cir. 2006) (internal quotes omitted). This standard presents a "high threshold," and "a 'good cause' showing will not, without more, satisfy" it. Id. at 1180 (citations omitted). To meet the "compelling reasons" standard, a party seeking to seal material must show specific, individualized reasons for the sealing, "'without relying on hypothesis or conjecture,'" such as "'whether disclosure of the material could result in improper use of the material for scandalous or libelous purposes or infringement upon trade secrets.'" See Pintos v. Pacific Creditors Ass'n, 605 F.3d 665, 679, 679 n.6 (9th Cir. 2009) (quoting Hagestad v. Tragesser, 49 F.3d 1430, 1434 (9th Cir.1995)). The Ninth Circuit has found the compelling reasons standard met by "pricing terms, royalty rates, and guaranteed minimum payment terms" in a license agreement, as these are trade secrets used in the party's business, conferring an opportunity to obtain advantage over competitors who do not know or use them. In re Elec. Arts, Inc., 298 F. App'x 568, 569 (9th Cir. 2008); see also Apple Inc. v. Samsung Elecs. Co., 727 F.3d 1214, 1225 (Fed. Cir. 2013) (applying this standard and sealing "detailed product-specific financial information" and "profit, cost, and margin data" that "could give the suppliers an advantage in contract negotiations, which they could use to extract price increases for components"). However, "[s]imply mentioning a general category of privilege, without any further elaboration or any specific linkage with the documents, does not satisfy the burden." Kamakana, 447 F.3d at 1184. In particular, "[a]n unsupported assertion of 'unfair advantage' to competitors without explaining 'how a competitor would use th[e] information to obtain an unfair advantage' is insufficient." Ochoa v. McDonald's Corp., No. 14-CV-02098-JD, 2015 WL 3545921, at *1 (N.D. Cal. Jun. 5, 2015) (quoting Hodges v. Apple, Inc., No. 13-cv-01128-WHO, 2013 WL 6070408, at *2 (N.D. Cal. Nov. 18, 2013)).
Under Civil Local Rule 79-5, a sealing request must also "be narrowly tailored to seek sealing only of sealable material," and "establish[ ] that the document, or portions thereof, are privileged, protectable as a trade secret or otherwise entitled to protection under the law." Civil L.R. 79-5(b). When ordering sealing, the district court must "articulate the rationale underlying its decision to seal." Apple Inc. v. Psystar Corp., 658 F.3d 1150, 1162 (9th Cir. 2011).
II. DETERMINATIONS
Many of the requests here fail to comply with Civil Local Rule 79-5 because they were not filed with an unredacted version showing "by highlighting or other clear method, the portions of the document that have been omitted from the redacted version." Civil L.R. 79-5(d)(1)(D). While the sealing requests could have been denied on that ground, the Court undertook the burden of comparing the unredacted and redacted copies mainly to move this case to resolution without further delay. But the parties are advised that any future motions to seal will be summarily denied if Local Rule 79-5, or the Court's prior orders on sealing requests, are not followed to the letter.
This table summarizes the administrative motions to seal that the Court rules on in this order:
| Motion (Dkt. No.) | Documents Sought to be Sealed (by Dkt. No.) | Party Declaration inSupport (by Dkt.No.) |
| 113 | 113-14 to 113-22 - Exhibits B, F, G, I, J to MerrillDeclaration113-12 - Portions of Johnstech's Summary JudgmentMotion referencing these Exhibits | 113-1, 113-13114 |
| 116 | 116-13 to 116-22 - Exhibits 2, 4-8, 8A, 9, 14, 15 toMerrill Declaration116-12 - Portions of Johnstech's Opposition to JFM'sSummary Judgment Motion referencing these Exhibits | 116-1130 |
| 117 | 117-2, -6, -8, -10 - Exhibits B, G, I, J to HayesDeclaration | 117-1 |
| 131 | 131-5 - Exhibit E to Second Merrill Declaration131-4 - Reply Memorandum referring to Exhibit E | 131-1 |
| 144 | 144-4 and -6 - Exhibits B and C to Hansen Declarationin Support of JFM's Response re Discovery Sanctions | 144-1 |
A. Administrative Motion to Seal Documents Filed in Support of Johnstech's Motion for Summary Judgment (Dkt. No. 113)
Johnstech states that it filed these documents under seal because they were designated "Confidential" or "Highly Confidential - Attorney's Eyes Only" by JFM under the protective order in this matter. Dkt. No. 113. JFM filed a declaration with facts supporting the sealing request. Dkt. No. 114.
| Document | JFM's Basis for Sealing(Dkt. No. 114) | Ruling |
|---|---|---|
| 113-14(Exhibit B) | Identifies shared customers andcontains confidential informationon specific amounts of JFM'sbusiness attributable to thosecustomers over specific periodsof time. | Granted. The exhibit details product-specific customer data that could beused to the company's competitivedisadvantage. See Apple, 727 F.3d at1228. |
| 113-15(Exhibit F) | Identifies customers targeted byJohnstech and provides financialinformation that could be usedby others to disadvantage JFM. | Granted. The customer informationqualifies as trade secrets and theredactions are narrowly tailored to sealjust this information. See In re Elec.Arts, 298 F. App'x at 569. |
| 113-16(Exhibit G) | Confidentiality assertionwithdrawn | Denied. |
|---|---|---|
| 113-17 to113-21(Exhibit I) | Expert report with nonpublicfinancial information aboutJFM's sales and profits related tospecific customers. JFM seeksto seal certain redacted portionsof the report as shown in Dkt.No. 114-2, and Schedule andAppendix 1 to the report in theirentirety. JFM does not seek toseal the report's attachments.Dkt. No. 114 ¶¶ 6-10. | Granted in part. Sealed to the extent itcontains detailed sales information forcustomers that could be used to thecompany's competitive disadvantage.See Apple, 727 F.3d at 1228. Therequest to seal redacted portions in Dkt.No. 114-2, and Schedule and Appendix1, is granted. The request is deniedotherwise. JFM also states that iswithdrawing this Exhibit and will notrely upon it further in this case. |
| 113-22(Exhibit J) | Confidentiality assertionwithdrawn | Denied. |
| 113-12(MotionreferencingtheseExhibits) | No further response. | Granted in part. Granted to the extentthat the Court has permitted sealing ofthe Exhibits, and denied otherwise. |
B. Johnstech's Administrative Motion to Seal Documents Filed in Opposition of JFM's Motion for Summary Judgment (Dkt. No. 116)
Johnstech filed a motion to seal Exhibits 2, 4, 5, 6, 7, 8, 8A, 9, 14, and 15 to its Opposition to JFM's summary judgment motion, and portions of its Opposition referencing them, because the Exhibit materials were designated "Confidential" or "Highly Confidential - Attorney's Eyes Only" by JFM or third party IDI under the protective order in this matter. Dkt. No. 116 at 3. JFM filed a declaration addressing the sealing of all exhibits except Exhibit 2. Dkt. No. 130.
| Document | JFM's Response(Dkt. No. 130) | Ruling |
| 116-13 (Exhibit 2) | No response. | Denied. The parties have notprovided adequate justification forsealing this document. IDI has notfiled any declaration in support ofsealing as required by the LocalRule. |
|---|---|---|
| 116-14 (Exhibit 4) | Confidentiality assertion withdrawn | Denied. |
| 116-15 (Exhibit 5) | Confidentiality assertion withdrawn | Denied. |
| 116-16(Exhibit 6) | Confidentiality assertion withdrawn | Denied. |
| 116-17 (Exhibit 7) | Confidentiality assertion withdrawn | Denied. |
| 116-18 (Exhibit 8) | Confidentiality assertion withdrawn | Denied. |
| 116-19 (Exhibit 8A) | JFM requests that this document besealed in part because itcontains identification of JFM'scustomers and their employees.JFM contends this is "highlysensitive business information thatis not publicly available and couldbe used by others to obtain unfairadvantage in competition and/ornegotiations with JFM." Dkt. No.130 ¶ 7. | Granted. The proposedredactions in Dkt. No. 30-1 arenarrowly tailored to preventspecific identification of customersand employees, while opening tothe public specific details onJohnstech's communications withthem. |
|---|---|---|
| 116-20 (Exhibit 9) | JFM requests that this document besealed in its entirety because itcontains identification of JFMcustomers and confidentialcorrespondence with a customertargeted by Johnstech as "highlysensitive business information thatis not publicly available and couldbe used by others to obtain unfairadvantage in competition and/ornegotiations with JFM." | Granted. The document containsnotes from specific customer visitsand competitive intelligencegathered from them that qualifiesas trade secrets used in the party'sbusiness, establishing compellingreasons to seal the document. Inre Elec. Arts, 298 F. App'x at 569. |
| 116-21 (Exhibit 14) | JFM requests that this document besealed in its entirety because itcontains identification of JFM'scustomers targeted by Johnstechand related informationreflecting the damage to JFM'sbusiness caused by Johnstech'sFalse Letter. | Granted with respect to theidentities and contactinformation of individuals andotherwise denied. |
| 116-22 (Exhibit 15) | JFM requests that this document besealed in its entirety becausecontains identification of JFM'scustomers targeted by Johnstechand related JFM financialinformation reflecting the damageto JFM's business caused byJohnstech's False Letter. | Granted. The exhibit detailscustomer-specific sales data thatqualifies as trade secretsinformation used in the party'sbusiness, establishing compellingreasons to seal the document. Inre Elec. Arts, 298 F. App'x at 569. |
| 116-12 (Motionreferencingabovementionedmaterials) | JFM seeks sealing of the SummaryJudgment Opposition brief to theextent it contains and refers tohighly confidential JFM businessinformation, including page 20,lines 8, 13-14, 16 and 18, as thesesections contain identification ofJFM's customers targeted byJohnstech's False Letter. | Granted in part. Granted to theextent it seeks sealing ofreferences to Exhibits that theCourt has ordered sealed. Neitherparty has provided justification forsealing the Opposition brief morebroadly.Johnstech's request to seal theportions of the Opposition briefredacted in Dkt. No. 116-3 isgranted to the extent the redactionspertain to information that theCourt has ordered sealed, anddenied otherwise.JFM's request to redact specificcustomer names and thepercentage of business to thosecustomers in page 20, lines 8, 13-14, 16 and 18 of the brief isgranted. |
|---|
C. Administrative Motion to File Under Seal Exhibits to Hayes Declaration In Support of Defendant's Opposition to Johnstech's Motion for Summary Judgment (Dkt. No. 117)
JFM indicates that these portions of documents were filed under seal because they "contain and refer" to information designated highly confidential by plaintiff Johnstech or defendant JFM. Dkt. No. 117.
| Document | JFM's Argument(Dkt. No. 117-1) | Ruling |
| 117-4 (Exhibit B) | Exhibit B identifies JFM'scustomers targeted by Johnstech'sFalse Letter. | Granted. The particular customerinformation qualifies as tradesecrets that JFM has compellingreasons to seal, and the redactionsare narrowly tailored to seal justthis information. See In re Elec.Arts, 298 F. App'x at 569. |
|---|
| 117-6 (Exhibit G) | Exhibit G identifies JFM'scustomers targeted by Johnstech'sFalse Letter. | Granted. The particular customerinformation qualifies as tradesecrets that JFM has compellingreasons to seal, and the redactionsare narrowly tailored to seal justthis information. See In re Elec.Arts, 298 F. App'x at 569. |
|---|---|---|
| 117-8 (Exhibit I) | Exhibit I identifies JFM'scustomers targeted by Johnstech'sFalse Letter. | Granted. The particular customerinformation qualifies as tradesecrets that JFM has compellingreasons to seal, and the redactionsare narrowly tailored to seal justthis information. See In re Elec.Arts, 298 F. App'x at 569. |
| 117-10 (Exhibit J) | Exhibit J refers to proprietary JFMproduct design information,including product componentfeatures unique to the Zigmaproduct line. | Granted. See In re Elec. Arts,298 F. App'x at 569. |
D. Administrative Motion to Seal Documents Filed in Support of Plaintiff's Reply on Summary Judgment (Dkt. No. 131)
Johnstech states that the documents filed at Dkt. Nos. 131-4 and 131-5 were filed under seal because they contain material designated "Highly Confidential - Attorney's Eyes Only" by JFM under the protective order in this matter. Dkt. No. 131. JFM has withdrawn its confidentiality assertions for these materials. Dkt. No. 137. Accordingly, the motion to seal is denied. The Clerk is directed to remove the confidentiality lock on the two documents and make them available to the public.
E. Administrative Motion to File Under Seal Exhibits to Hansen Declaration In Support of Defendant's Response to Johnstech's Motion for Discovery Sanctions (Dkt. No. 144)
JFM seeks to redact portions of depositions of two JFM employees that contain information designated highly confidential by JFM. Dkt. No. 144. JFM seeks sealing of the identity of certain customers and their employees who were "targeted by Johnstech's False Letter and confidential information regarding changes in those customers' purchases from JFM." Dkt. No. 144-1.
| Document | JFM's Argument(Dkt. No. 144-1) | Ruling |
| 144-4 (Exhibit B) | Exhibit B refers to JFM'scustomers re Johnstech's FalseLetter and customer purchases fromJFM. | Granted. The particular customerinformation qualifies as tradesecrets that JFM has compellingreasons to seal, and the redactionsare narrowly tailored to seal justthis information See In re Elec.Arts, 298 F. App'x at 569. |
|---|---|---|
| 144-6 (Exhibit C) | Exhibit C refers to JFM'scustomers re Johnstech's FalseLetter and customer purchases fromJFM. | Granted. The particular customerinformation qualifies as tradesecrets that JFM has compellingreasons to seal, and the redactionsare narrowly tailored to seal justthis information See In re Elec.Arts, 298 F. App'x at 569 |
CONCLUSION
Within fourteen days of this order, the parties should file unredacted documents or documents with revised redactions, as necessary to comply with this order, in the public record of this case. If the parties do not file new copies of the affected documents by this deadline, the Court will unseal the versions previously filed in this matter.
IT IS SO ORDERED. Dated: August 2, 2016
/s/_________
JAMES DONATO
United States District Judge