Judge Vince Chhabria of the Northern District of California handed down a strongly worded order denying a motion to seal alleged trade secret information, and sanctioning counsel for defendant for the frivolous request. The order is a stern reminder to the sanctioned attorneys and to trade secret litigants in federal court generally that federal litigation is traditionally a public process, and that parties seeking to remove documents from the public’s access often face an uphill battle in order to do so.
Justice Chhabria, and other district court judges in the Ninth Circuit are guided by the Circuit’s seminal decision in Kamakana v. City and County of Honolulu, 447 F.3d 1172 (9th Cir. 2006), which held that a movant must show “compelling reasons” to overcome the common law presumption of public access to “judicial documents”—which include all dispositive motions and their supporting exhibits—and must make a “particularized showing” of “good cause” for the court to grant a motion to seal any other document. Kamakana protects trade secrets: the decision recognized that the threatened publication of confidential trade secrets was a “compelling reason” outweighing the presumption of public access, and courts in the Ninth Circuit have accordingly sealed documents where a party has shown that the documents contain its trade secret information.
The instant case involves a patent dispute between plaintiff Nevro Corp. and defendant Boston Scientific Corporation. Boston Scientific moved to seal certain emails between a Boston Scientific vice president and another employee, claiming that the conversation contained references to its trade secrets. Judge Chhabria denied the motion on the grounds that the email contained evidence that could show Boston Scientific’s intent to copy certain technologies, threatening sanctions if any other frivolous sealing motions were filed.
After Boston Scientific moved for partial reconsideration, Judge Chhabria issued an order to show cause why their attorneys should not each be sanctioned $500. At the subsequent hearing, counsel for the parties discussed the pressure attorneys face to seal documents. Judge Chhabria’s order admonished the lawyers that the correct answer to this pressure is “to firmly explain…that litigation is a public process, and that the public has the right to know what the litigation is about, subject to very limited exceptions” which do not include “mere embarrassment to a corporation.”