Nallapati v. Justh Holdings, LLC

• Decision Date: 28 October 2022
• Docket Number: 5:20-CV-47-D
• Parties: VAMSI NALLAPATI & IGM SURFACES, LLC, Plaintiffs, v. JUSTH HOLDINGS, LLC, and HARI HARA PRASAD NALLAPATY, Defendants, VAMSI NALLAPATI, VINAY BHARADWAJ, ROHIT GANGWAL, COSMOS GRANITE DALLAS, LLC, COSMOS GRANITE CHARLOTTE, LLC, and COSMOS GRANITE CHARLESTON, LLC, Counter-Defendants.
• Court: U.S. District Court — Eastern District of North Carolina

VAMSI NALLAPATI & IGM SURFACES, LLC, Plaintiffs,
v.
JUSTH HOLDINGS, LLC, and HARI HARA PRASAD NALLAPATY, Defendants,

VAMSI NALLAPATI, VINAY BHARADWAJ, ROHIT GANGWAL, COSMOS GRANITE DALLAS, LLC, COSMOS GRANITE CHARLOTTE, LLC, and COSMOS GRANITE CHARLESTON, LLC, Counter-Defendants.

No. 5:20-CV-47-D

United States District Court, E.D. North Carolina, Western Division

October 28, 2022

ORDER

Robert B. Jones United States Magistrate Judge

This matter is before the court on Defendants' motions to seal. [DE-141, -161, -186, -219, -226, -261]. Plaintiffs and Counter Defendants (collectively “Plaintiffs”) responded to the motions, [DE-163, -165, -228, -269], and Defendants filed a reply, [DE-173]. For the reasons stated below, the motions to seal at Docket Entries 141,161,219, and 261 are allowed in part and denied in part, and the motions to seal at Docket Entries 186 and 226 are allowed.

I. Legal Standard

“[T]he courts of this country recognize a general right to inspect and copy public records and documents, including judicial records and documents.” Nixon v. Warner Commc 'ns, Inc., 435 U.S. 589, 597 (1978) (internal footnote omitted). The Fourth Circuit has directed that before sealing publicly-filed documents, the court must first determine if the source of the public's right

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to access the documents is derived from the common law or from the First Amendment. Stone v. Univ, of Md., 855 F.2d 178, 180 (4th Cir. 1988). “[T]he common law presumption in favor of access attaches to all ‘judicial records and documents,' [while] the First Amendment guarantee of access has been extended only to particular judicial records and documents[,]” such as those filed in connection with a motion for summary judgment. Id. (quoting Nixon, 435 U.S. at 597 & citing Rushford v. New Yorker Magazine, Inc., 846 F.2d 249, 253 (4th Cir. 1988); In re Washington Post Co., 807 F.2d 383, 390 (4th Cir. 1986)). “[D]ocuments filed with the court are ‘judicial records' if they play a role in the adjudicative process, or adjudicate substantive rights.” In re Application of the U.S. for an Order Pursuant to 18 U.S.C. Section 2703(D) (“In re Application'''''), 707 F.3d 283, 290 (4th Cir. 2013) (citations omitted); see also United States v. Amodeo, 44 F.3d 141, 145 (2d Cir. 1995) (“[T]he item filed must be relevant to the performance of the judicial function and useful in the judicial process in order for it to be designated a judicial document.”).

Courts apply the “experience and logic” test to determine whether there is also a First Amendment right to access, which provides more substantive protection to the public's interest in access than does the common law. In re Application, 707 F.3d at 291; Rushford, 846 F.2d at 253. Under this test, the court considers “(1) ‘whether the place and process have historically been open to the press and general public,' and (2) ‘whether public access plays a significant positive role in the functioning of the particular process in question.'” In re Application, 707 F.3d at 291 (quoting Baltimore Sun Co. v. Goetz, 886 F.2d 60, 64 (4th Cir. 1989)). The Fourth Circuit has determined that the more rigorous First Amendment standard should apply to documents filed in connection with a summary judgment motion in a civil case “[b]ecause summary judgment adjudicates substantive rights and serves as a substitute for a trial,” which is generally open to the public. Rushford, 846 F.2d at 252-53.

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Here, the documents sought to be sealed were filed in conjunction with summary judgment briefing. Accordingly, the First Amendment right of access applies. However, “[t]he mere existence of a First Amendment right to access or a common law right of access to a particular kind of document does not entitle[] the press and the public to access in every case.” Rushford, 846 F.2d at 253 (citation omitted). “To overcome the First Amendment standard, sealing must be ‘essential' to preserve important, higher interests,” BASF Plant Set, LP v. Commonwealth Sci. & Indus. Research Organisation, No. 2:17-CV-503, 2019 WL 8108115, at *2 (E.D. Va. Aug. 15, 2019) (citation omitted), and “narrowly tailored to serve that interest,” Rushford, 846 F.2d at 253. The “protection of a party's interest in confidential commercial information, such as a trade secret, where there is a sufficient threat of irreparable harm” is a recognized exception to the “presumptive openness of judicial proceedings.” Publicker Indus., Inc. v. Cohen, 733 F.2d 1059, 1071 (3d Cir. 1984) (citing Stamicarbon, N. V. v. American Cyanamid Co., 506 F.2d 532, 539-42 (2d Cir. 1974)). The party seeking to deny access bears the burden. Rushford, 846 F.2d at 253.

To determine whether records should be sealed, the court must follow the procedure established in In re Knight Publishing Company, 743 F.2d 231 (4th Cir. 1984). The court must first provide “public notice of the request to seal and allow the interested parties a reasonable opportunity to object.” Id. at 235-36. Notice is sufficient where a motion is docketed reasonably in advance of its disposition. Id. at 235. Second, the court considers less drastic alternatives, such as redaction of any sensitive...