Bae Sys. San Diego Ship Repair Inc. v. United States

• Decision Date: 24 April 2023
• Docket Number: 22-cv-00515-L-BGS
• Parties: BAE SYSTEMS SAN DIEGO SHIP REPAIR INC., Plaintiff, v. THE UNITED STATES OF AMERICA, Defendant.
• Court: U.S. District Court — Southern District of California

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BAE SYSTEMS SAN DIEGO SHIP REPAIR INC., Plaintiff,
v.
THE UNITED STATES OF AMERICA, Defendant.

No. 22-cv-00515-L-BGS

United States District Court, S.D. California

April 24, 2023

ORDER:

(1) GRANTING DEFENDANT'S MOTION FOR A PROTECTIVE ORDER, (2) GRANTING THE PARTIES' JOINT MOTION TO FILE UNDER SEAL EXHIBIT 1, AND

(3) GRANTING PLAINTIFF'S MOTION TO FILE UNDER SEAL EXHIBIT 1 TO PLAINTIFF'S SUPPLEMENT TO JOINT STATEMENT

[ECF 33, 34, AND 40]

Hon. Bernard G. Skomal United States Magistrate Judge

On March 8, 2023, the parties filed a Joint Statement regarding the United States' Motion for a Protective Order under Federal Rule of Civil Procedure 26(c). (ECF 33.) In relevant part, BAE Systems San Diego Ship Repair, Inc., Plaintiff, served deposition notices for United States Navy Vice Admirals Galinis and Kitchener, Rear Admiral Haycock, and Rear Admiral Ver Hage. In response, the United States of America, acting through the Department of the Navy, Southwest Regional Maintenance Center,

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Defendant, has moved for the Court to enter a protective order precluding Plaintiff from deposing the four on the basis that they are protected by the “Apex” doctrine.^[1] (Id.)

On February 27, 2023, the parties placed a joint call to this Court with a discovery dispute over the deposition of the four witnesses. (See ECF 30.) This Court ordered the parties to file a joint brief regarding the dispute. (Id.) The parties have filed the joint brief (ECF 33) and a joint motion to file documents under seal (ECF 34), Plaintiff has filed a supplemental document (ECF 39), and a motion to file documents related to the supplemental document under seal (ECF 40), and Defendant has filed a response to Plaintiff's supplemental document (ECF 42).

For the following reasons, the Court GRANTS the parties' joint motion for Permission to File Under Seal Exhibit 1 (ECF 34) and Plaintiff's motion for Permission to File Under Seal Exhibit 1 to Plaintiff's Supplement to Joint Statement (ECF 40). The Court declines to consider Exhibit 1 to Plaintiff's Supplement, however. The Court also declines to consider Plaintiff's supplemental document. (ECF 39.) The Court GRANTS Defendant's motion for a protective order. (ECF 33.)

I. BACKGROUND

Plaintiff provides “emergency and planned ship repair, modernization, and overhaul services for [Defendant].” (Compl. [ECF 1] ¶ 9.) Plaintiff uses subcontractors including South Bay Sandblasting & Tank Cleaning, Pacific Tank Cleaning, and California Marine Cleaning. (Compl. ¶ 10.)

In September 2019, Plaintiff was awarded contracts to repair, maintain, and modernize the USS Decatur and the USS Stethem, which are “Arleigh Burke-class guided-missile destroyers.” (Compl. ¶¶ 2, 15-16.)

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As part of its contracts with Defendant, Plaintiff flushed portions of the two ships' air systems. (Compl. ¶ 2.) Plaintiff alleges that Defendant found deficiencies in the air systems, which prompted it to sample them. (Compl. ¶ 2.) Defendant then found evidence of alleged oil contamination. (Id.) Defendant asserted that Plaintiff and Plaintiff's subcontractor were to blame for the contamination. (Id.)

Plaintiff alleges that in March and April 2021, Defendant directed Plaintiff to reflush the dry air systems on both ships using Nitrogen Oxide Cleaner (NOC). (Compl. ¶¶ 45, 49.) Later in April 2021 and in May 2021, Defendant directed Plaintiff to use Tribasic Sodium Phosphate (TSP) instead. (Compl. ¶¶ 50, 53.) Plaintiff alleges that NOC flushing “is not normally conducted on surface ships like the Decatur and Stethem” (Compl. ¶ 46), and that NOC flushing was “a significant change to the contract requirements of ‘hot water' flushing” (Compl. ¶ 48).

While the ships were being cleaned, Defendant sampled air systems in the USS Carney, another Arleigh Burke-class ship, which was located in Jacksonville, Florida. (Compl. ¶ 29.) Plaintiff alleges that the Carney's air systems were “dirtier than expected.” (Compl. ¶ 30.) Plaintiff also alleges that “contamination found in the air systems aboard the Carney exhibited similarities to the contamination found in the Decatur and the Stethem, which further indicated that the air system contamination on the Decatur and Stethem predated any flushing performed by [Plaintiff's subcontractor].” (Compl. ¶ 64.)

Plaintiff alleges that its “independent and qualified experts identified contamination in areas not flushed by [Plaintiff's subcontractor], which confirmed that the contamination was not attributable to or a result of [the subcontractor's] flushing activities.” (Compl. ¶ 62.) In March 2022, after Plaintiff submitted Requests for Equitable Adjustment to the Government and was unable to get compensated, Plaintiff submitted formal claims to the Government. (Compl. ¶ 5.) Plaintiff sought reimbursement for all costs associated with the additional flushing work. (Compl. ¶¶ 4, 5.) On March 8, 2022, in two Contracting Officer's Final Decisions, Plaintiff's claims

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were denied. (Compl. ¶ 7.) On April 14, 2022, Plaintiff filed the Complaint in this case. (ECF 1.) Plaintiff's Complaint asserts four claims: (1) Dispute Under the Contract; (2) Breach of Contract (Changes); (3) Breach of Contract (Superior Knowledge); and (4) Quantum Meruit. (Id.)

I. MOTIONS TO SEAL AND SUPPLEMENTAL DOCUMENT

In accordance with the Civil Local Rule 79.2, Judge Skomal's Chambers' Rules, and the parties' Stipulated Protective Order Regarding Confidential Information, the parties jointly move to file Exhibit 1 to the Declaration of Alex E. Wallin (ECF 33-2) under seal (ECF 24), and Plaintiff moves to file Exhibit 1 to its supplemental document (ECF 39), under seal. In the joint motion, the parties designate Exhibit 1 as “Confidential” in accordance with the protective order in this case. (ECF 34 at 2.) The parties describe Exhibit 1 as “an email thread including several Navy personnel that discusses, among other things, information regarding Navy ships that [the Navy] claims should be protected from public disclosure.” (ECF 34 at 2.) Plaintiff seeks to file Exhibit 1 to the supplement as “Confidential” in accordance with the protective order as well. (ECF 40.)

Unlike judicial records that have been attached to a dispositive motion, judicial records attached to “[n]on[-]dispositive motions ‘are often unrelated, or only tangentially related, to the underlying cause of action,' and, as a result, the public's interest in accessing dispositive materials does ‘not apply with equal force' to non-dispositive materials.” Pintos v. Pac. Creditors Ass'n, 605 F.3d 665, 678 (9th Cir. 2010) (quoting Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1179 (9th Cir. 2006)). “A ‘good cause' showing will suffice to seal documents produced in discovery.” Kamakana, 447 F.3d at 1180 (citing Fed.R.Civ.P. 26(c)). “For good cause to exist, the party seeking protection bears the burden of showing specific prejudice or harm will result if no protective order is granted.” Phillips ex rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1210-11 (9th Cir. 2002).

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After examining the Exhibit 1 to the joint motion and Exhibit 1 to the supplement, the Court concludes there is good cause to seal both exhibits because information in the exhibits fits within “confidential information” in the protective order. See East West Bank v. Shanker, No. 20-cv-07364-WHO, 2021 WL 4916729, at *1 (N.D. Cal. Aug. 31, 2021) (“There may be good cause to seal records that are privileged, contain trade secrets, contain confidential research, development or commercial information, or if disclosure of the information might harm a litigant's competitive standing.” (internal quotation marks omitted)).

Plaintiff has also filed a Supplemental Document, which Plaintiff states includes documents Plaintiff has just received from Defendant in discovery that support Plaintiff's position in the parties' joint motion. (ECF 39 at 2.) Defendant objects to the supplement, noting that Plaintiff unilaterally filed it, failed to meet and confer with Defendant before filing it, and provided Defendant no notice that it would be filing it. (ECF 42 at 2.)

Under Judge Skomal's Chambers' Rules, parties are required to meet and confer if they have a discovery dispute. Judge Skomal's Chambers' Rules, Section V.B. After doing so, the parties must contact Chambers and speak with the research attorney assigned to the case. Id. The Court will then either schedule a further telephonic discovery conference or advise the parties to file a motion. Id.

With regard to the depositions at issue, the parties met and conferred and then contacted Chambers and spoke to the research attorney assigned to their case. (See ECF 30.) The Court ordered that the parties file the Joint Statement in this case “no later than the close of business on 3/13/2023.” (Id.) The parties' Joint Motion and Motion to Seal were filed on March 8, 2023. Plaintiff's Supplemental Document and a Motion to Seal the documents in the Supplemental Document were filed on March 22, 2023. As Defendant notes, Plaintiff did not try to meet and confer with Defendant regarding the additional documents included in the supplement and did not contact Chambers regarding the additional documents included in the supplement. See Judge Skomal's Chambers' Rules, Section V.B. Further, Plaintiff's Supplemental Document was filed nine days

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after the parties' deadline to file their joint statement, and unilaterally. (See ECF 30.) Plaintiff has followed none of the procedures under Section V.B. As a result, the Court will not consider the Supplemental Document.^[2]

II. APEX DEPOSITIONS

“Courts have often observed that discovery seeking the deposition of high-level executives (so-called “apex” depositions) creates a tremendous potential for abuse or harassment that may require the court's intervention for the witness's protection under Rule 26(c).”^[3] Conforto v. Mabus, No. 12cv1316-W (BLM),...