Bradshaw v. Maiden

Citation2020 NCBC 26
Decision Date07 April 2020
Docket Number14 CVS 14445
CourtSuperior Courts of Law and Equity of North Carolina
PartiesJAMES W. BRADSHAW; CARLA O. BRADSHAW; RESORT RETAIL ASSOCIATES, INC.; E.C. BROADFOOT; CHRISTINA DUNN CHANDRA; THOMAS F. EGAN; CHARLES EGGERT; MARK P. GARSIDE; DR. JAMES J. GREEN, JR.; ROBERT K. GRUNEWALD; RONALD HOLMES; DAVID LAUCK; CURT W. LEMKAU, JR.; EVAN MIDDLETON; JOSHUA M. NELSON; CHRISTIAN C. NUGENT; REGINA H. PAKRADOONI, as Executrix of the Estate of PETER B. PAKRADOONI, deceased; FORD PERRY; MARCELLO G. PORCELLI; ADAN RENDON; RICHARD H. STEVENSON; PAUL STOKES; LAWRENCE J. THEIL; R. MITCHELL WICKHAM; WILLIAM H. WILLIAMSON, III; WILLIAM K. WRIGHT, JR.; ALEX M. WOLF; CHAFFIN FAMILY LIMITED PARTNERSHIP; and SOLARIS CAPITAL LLC, Plaintiffs, v. STEPHEN E. MAIDEN; MAIDEN CAPITAL, LLC; and SS&C TECHNOLOGIES, INC., successor by merger to SS&C FUND ADMINISTRATION SERVICES, LLC (a/k/a SS&C FUND SERVICES), Defendants. SS&C TECHNOLOGIES, INC., successor by merger to SS&C FUND ADMINISTRATION SERVICES, LLC, Third-Party Plaintiff, v. MAIDEN CAPITAL OPPORTUNITY FUND, LP, Third-Party Defendant.

Mauney PLLC, by Gary V. Mauney, and Lewis & Roberts, PLLC, by James A. Roberts, III, for Plaintiffs James W. Bradshaw Carla O. Bradshaw; Resort Retail Associates, Inc.; E.C Broadfoot; Christina Dunn Chandra; Thomas F. Egan; Charles Eggert; Mark P. Garside; Dr. James J. Green, Jr.; Robert K Grunewald; Ronald Holmes; David Lauck; Curt W. Lemkau, Jr. Evan Middleton; Joshua M. Nelson; Christian C. Nugent; Regina H. Pakradooni, as Executrix of the Estate of Peter B. Pakradooni, deceased; Ford Perry; Marcello G. Porcelli; Adan Rendon; Richard H. Stevenson; Paul Stokes; Lawrence J. Theil; R. Mitchell Wickham; William H. Williamson, III; William K. Wright, Jr.; Alex M. Wolf; Chaffin Family Limited Partnership; and Solaris Capital LLC.

Alston & Bird LLP, by Michael A. Kaeding and Ryan P. Ethridge, and Paul, Weiss, Rifkind, Wharton & Garrison LLP, by Jeffrey Recher and John Baughman, for Defendant SS&C Technologies, Inc.

INTERIM ORDER AND OPINION ON MOTIONS TO SEAL
LOUIS A. BLEDSOE, III CHIEF BUSINESS COURT JUDGE
I. FACTUAL BACKGROUND

1. THIS MATTER is before the Court upon (i) Defendant SS&C Technologies, Inc.'s ("SS&C") Motion for Leave to File Under Seal (the "First Motion to Seal"), (ECF No. 260); (ii) Plaintiffs' Motion to File Under Seal (the "Second Motion to Seal"), (ECF No. 277); and (iii) SS&C's Motion for Leave to File Under Seal (the "Third Motion to Seal"), (ECF No. 283), (collectively, the "Motions to Seal") in the above-captioned case.

2. The Court elects to enter this Interim Order and Opinion concerning the Motions to Seal without a hearing pursuant to Rule 7.4 of the North Carolina Business Court Rules ("BCRs"). After considering the Motions to Seal, the related briefing, and the tendered exhibits, the Court, for the reasons below, GRANTS in part, DENIES in part, and DEFERS in part the Motions to Seal.

3. This case arises out of the collapse of a private hedge fund, Maiden Capital Opportunity Fund, LP ("Fund"), managed exclusively by Maiden Capital, LLC ("Maiden Capital"). See Bradshaw v. Maiden, 2017 NCBC LEXIS 30, at *2 (N.C. Super. Ct. Mar. 31, 2017). Defendant Stephen E. Maiden ("Maiden"), the managing partner of Maiden Capital, used the Fund to orchestrate an alleged multi-million dollar "Ponzi scheme," resulting in financial losses to Plaintiffs, all of whom invested in the Fund. See Bradshaw v. Maiden, 2018 NCBC LEXIS 98, at *2-3 (N.C. Super. Ct. Sept. 20, 2018). SS&C administered the Fund's accounts from approximately 2007 until the Fund's demise in 2013. See Bradshaw v. Maiden, 2018 NCBC LEXIS 46, at *2 (N.C. Super. Ct. May 9, 2018).

4. SS&C and Plaintiffs are now seeking to seal numerous documents filed in support of and/or in opposition to SS&C's Motion for Summary Judgment. For the reasons discussed below, the Motions to Seal do not provide sufficient information for the Court to determine whether sealing is warranted under BCR 5 for a majority of the materials the parties seek to have sealed. The Court issues this Interim Order and Opinion to identify these procedural defects and to grant the parties an opportunity to cure by filing a supplemental brief or briefs in support of the Motions to Seal as well as public redacted versions of the Sealed Documents.[1]

II. PROCEDURAL HISTORY

5. On October 28, 2019, SS&C filed (i) a Motion for Summary Judgment, (Mot. Summ. J., ECF No. 256); (ii) a memorandum in support thereof ("SS&C's Memorandum in Support"), (Mem. Law Supp. Mot. Summ. J., ECF No. 257), which was provisionally filed under seal; and (iii) an index and several exhibits, (Exs. SS&C's Mot. Summ. J., Part 1, ECF No. 258). The next day, SS&C provisionally filed under seal fourteen additional exhibits to its Motion for Summary Judgment, (Exs. SS&C's Mot. Summ. J., Part 2 [hereinafter "Sealed Exs. SS&C's Mot. Sum. J."], ECF No. 259), along with the First Motion to Seal, (Mot. Leave File Under Seal [hereinafter "1st Mot. Seal"], ECF No. 260). On November 7, 2019, SS&C filed (i) a public version of SS&C's Memorandum in Support, (PUBLIC/REDACTED VERSION-Mem. Law Supp. SS&C's Mot. Summ. J. [hereinafter "Public Mem. Law Supp."], ECF No. 262); (ii) public versions of Exhibits A, D-F, I, P, and R-U to its Motion for Summary Judgment, (PUBLIC/REDACTED VERSION-Exs. SS&C's Mot. Summ. J., Part 2 [hereinafter "Public Exs. SS&C's Mot. Summ. J."], ECF No. 263); and (iii) a notice of filing Exhibits B, C, H, and Q to its Motion for Summary Judgment entirely under seal, (Notice Filing Under Seal-Exs. B, C, H, & Q SS&C's Mot. Summ. J. [hereinafter "Notice Filing Under Seal-Exs. B, C, H, & Q"], ECF No. 264).

6. On December 31, 2019, Plaintiffs provisionally filed under seal a brief in opposition to SS&C's summary judgment motion ("Plaintiffs' Brief in Opposition"), (Pls.' Br. Opp'n Def. SS&C's Mot. Summ. J. [hereinafter "Sealed Pls.' Br. Opp'n"], ECF No. 268). An affidavit, (Aff. Counsel, ECF No. 276), an index of exhibits and testimony excerpts, (Index Exs. & Dep. Test. Excerpts/Trial Test. [hereinafter "Sealed Index"], ECF No. 269), a compilation of deposition testimony and trial testimony excerpts, (Dep. Test. Excerpts & Trial Test. [hereinafter "Sealed Test. Excerpts"], ECF No. 275), and forty-seven documentary exhibits, (Exs. 3-12, ECF No. 270; Exs. 13-21, ECF No. 271; Exs. 23-33, ECF No. 272; Exs. 36, 38-46, ECF No. 273; Exs. 1- 2, 22, 34-35, 37, & 47, ECF No. 274), accompanied Plaintiffs' Brief in Opposition.

7. Plaintiffs sought to seal Plaintiffs' Brief in Opposition, the index, the compilation of deposition testimony and trial testimony excerpts, and Exhibits 3-21, 23-33, 36, and 38-46 in the Second Motion to Seal. (See Pls.' Mot. File Under Seal 1-2 [hereinafter "2nd Mot. Seal"], ECF No. 277.) Two days later, Plaintiffs provisionally filed under seal Exhibit 38, (Ex. 38, ECF No. 278), and Exhibit 39, (Ex. 39, ECF No. 279), because these exhibits failed to upload when the initial filing was made. On January 13, 2020, SS&C filed a supplemental brief in support of the Second Motion to Seal ("Supplemental Brief in Support of Second Motion to Seal"), (Suppl. Br. Resp. Pls.' Mot. Leave File Under Seal [hereinafter "Suppl. Br."], ECF No. 280), pursuant to BCR 5.3.

8. SS&C provisionally filed under seal two copies of its reply in support of its summary judgment motion (collectively, "SS&C's Reply Memorandum"), (Reply Mem. Law Further Supp. Def. SS&C's Mot. Summ. J., ECF Nos. 281-82), on January 30, 2020. That same day, SS&C provisionally filed under seal an index and seven exhibits, (Exs. X-DD SS&C's Reply Mem. Further Supp. Mot. Summ. J., ECF No. 282.1), together with the Third Motion to Seal, (Mot. Leave File Under Seal [hereinafter "3rd Mot. Seal"], ECF No. 283). Six business days later, SS&C filed (i) a public version of SS&C's Reply Memorandum, (PUBLIC-REDACTED VERSION_Reply Mem. Law Further Supp. Def. SS&C's Mot. Summ. J. [hereinafter "Public Reply"], ECF No. 284); (ii) public versions of the index and Exhibits X, Y, and AA-DD, (PUBLIC-REDACTED VERSION_Exs. X-DD Reply Mem. Law Further Supp. Def. SS&C's Mot. Summ. J. [hereinafter "Public Exs. X, Y, & AA-DD"], ECF No. 285); and (iii) a notice of filing Exhibit Z entirely under seal, (Notice Filing Under Seal_Ex. Z Reply Mem. Law Further Supp. Def. SS&C's Mot. Summ. J. [hereinafter "Notice Filing Under Seal-Ex. Z"], ECF No. 286).

III. LEGAL STANDARD

9. Documents filed in the courts of this State are "open to the inspection of the public[, ]" except as prohibited by law. N.C. G.S. § 7A-109(a); see Virmani v. Presbyterian Health Servs. Corp., 350 N.C. 449, 463, 515 S.E.2d 675, 685 (1999). Nevertheless," 'a trial court may, in the proper circumstances, shield portions of court proceedings and records from the public[.]'" France v. France, 209 N.C.App. 406, 413, 705 S.E.2d 399, 405 (2011) (emphasis omitted) (quoting Virmani, 350 N.C. at 463, 515 S.E.2d at 685). "The determination of whether [documents] should be filed under seal is within the discretion of the trial court." Taylor v. Fernandes, 2018 NCBC LEXIS 4, at *4 (N.C. Super. Ct. Jan. 18, 2018) (citing In re Investigation into Death of Cooper, 200 N.C.App. 180, 186-87, 683 S.E.2d 418, 424 (2009)). Nevertheless, courts should conceal records sparingly and only "in the interest of the proper and fair administration of justice[.]" Virmani, 350 N.C. at 463, 515 S.E.2d at 685.

10. BCR 5 governs the process for filing documents under seal in this Court and includes specific procedural instructions designed to ensure a proper balance between the interests of the litigants and the public. For the Court to assess whether sealing is warranted, a motion to seal documents must include "the circumstances that warrant sealed filing" and "the reason(s)...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT