Judge: Elaine Lu, Case: 20STCV19516, Date: 2025-05-13 Tentative Ruling

Case Number: 20STCV19516    Hearing Date: May 13, 2025    Dept: 9

Superior Court of California

County of Los Angeles

Spring Street Courthouse, Department 9

Background

            This is a putative wage-hour class action. Plaintiffs Alma Cano (“Cano”) and Zachary Rejniak (“Rejniak”) (jointly “Plaintiffs”) allege that the and the putative class members are and were non-exempt employees of Defendants Cerca Trova Restaurant Concepts, Inc. (“CT Concepts”) and Cerca Trova Steakhouse L.P. (“CT Steakhouse”) (jointly “Defendants”).  Plaintiffs also allege that Defendants violated the Labor Code, Industrial Welfare Commission wage orders, and the Business and Professions Code.

On September 3, 2019, Rejniak filed his putative class action complaint.  On January 7, 2020, Rejniak filed his operative First Amended Complaint.  In his First Amended Complaint, Rejniak asserts the following causes of action: (1) unpaid overtime; (2) unpaid meal period premiums; (3) unpaid rest period premiums; (4) unpaid minimum wages; (5) final wages not timely paid; (6) non-compliant wage statements; (7) violation of Business and Professions Code §§ 17200 et seq.; and (8) civil penalties under the Private Attorneys General Act (“PAGA”).

On May 21, 2020, Cano filed her putative class action complaint.  In her complaint, Cano asserted the following causes of action: (1) failure to provide required meal periods; (2) failure to provide required rest periods; (3) failure to pay overtime wages; (4) failure to pay minimum wage; (5) failure to pay all wages due to discharged and quitting employees; (6) failure to furnish accurate itemized statements; (7) failure to indemnify employees for necessary expenditures incurred in discharge of duties; (8) unfair and unlawful business practices; and (9) civil penalties under PAGA.

On September 2, 2020, the Court – presided by the Honorable Yvette M. Palazuelos – consolidated Rejniak’s and Cano’s cases designating Rejniak’s action (Case No. 19STCV31099) as the lead action.  (Minute Order 9/2/20.)  On March 5, 2021, the Court – presided by Judge Palazuelos – granted Plaintiff Rejniak’s request to dismiss the class action claims in Rejniak’s action.  (Order 3/5/21.) 

On September 23, 2021, the Court – presided by Judge Palazuelos – consolidated Rejniak’s and Cano’s cases designating the Cano Action (Case No. 20STCV129516) as the lead action because it retains class allegations.  (Minute Order 9/23/21.) 

On June 14, 2023, Plaintiffs filed the operative FAC.  In the FAC, Plaintiffs assert nine causes of action for: (1) failure to provide required meal periods; (2) failure to provide required rest periods; (3) failure to pay overtime wages; (4) failure to pay minimum wage; (5) failure to pay all wages due to discharged and quitting employees; (6) failure to furnish accurate itemized statements; (7) failure to indemnify employees for necessary expenditures incurred in discharge of duties; (8) unfair and unlawful business practices; and (9) civil penalties under PAGA.

On February 21, 2025, Plaintiffs filed a motion for preliminary approval of a class action settlement.  On April 3, 2025, the Court ordered additional briefing – including in relevant part documents evidencing Defendants’ financial condition – and continued the hearing to June 12, 2025.  (Final Checklist for Preliminary Approval of Class Action Settlement 4/3/25.)

On April 14, 2025, Defendants filed the instant motion to file under seal.  No opposition or reply has been filed.

Legal Standard

            “The public has a First Amendment right of access to civil litigation documents filed in court and used at trial or submitted as a basis for adjudication. [Citation.] Substantive courtroom proceedings in ordinary civil cases, and the transcripts and records pertaining to these proceedings, are ‘ “presumptively open.” ’ [Citation.]” (Savaglio v. Wal-Mart Stores, Inc. (2007) 149 Cal.App.4th 588, 596–597.)  As the Supreme Court has explained, “the public has an interest, in all civil cases, in observing and assessing the performance of its public judicial system, and that interest strongly supports a general right of access in ordinary civil cases.” (NBC Subsidiary, Inc. v. Superior Court (1999) 20 Cal.4th 1178,1210.)  “Openness is a presumption; it is not an absolute. The ‘presumption of openness can be overcome upon a proper showing’ compatible with the constitutional standards. [Citation.]”  (McNair v. National Collegiate Athletic Assn. (2015) 234 Cal.App.4th 25, 31.) 

California law authorizes the sealing of court records containing confidential information.  (NBC Subsidiary, Inc., supra, 20 Cal.4th at p.1222, Fn.46.)  California Rules of Court, 2.551(a) provides that a record may not be filed under seal without a court order, and the court must not permit a record to be filed under seal based solely on the agreement or stipulation of the parties.  (Cal. Rules of Court, 2.551(a).)  The party requesting a record be filed under seal must file a motion or an application for an order sealing the record that is accompanied by a memorandum or declaration containing facts to justify the sealing.  (Cal. Rules of Court, 2.551(b)(1).)  “The court may order that a record be filed under seal” if it finds that there is an overriding interest in favor of maintaining the confidentiality of the information.  (Cal. Rules of Court, 2.550(d).)

The court may order a record sealed if it finds that (1) an overriding interest exists that overcomes the right of public access to the record; (2) the overriding interest supports sealing the record; (3) a substantial probability exists that the overriding interest will be prejudiced if the record is not sealed; (4) the request is narrowly tailored; and (5) no less restrictive means exist to achieve the overriding interest. (Cal. Rules of Court, 2.550(d); See also Savaglio, supra, 149 Cal.App.4th at p.597 [ “Therefore, before a trial court orders a record sealed, it must hold a hearing and make findings that (1) there is an overriding interest supporting sealing of the records; (2) there is a substantial probability that absent sealing, such interest will be prejudiced; (3) the sealing order is narrowly tailored to serve the overriding interest; and (4) a less restrictive means of meeting that interest is not available.”].)

“As the party seeking an order sealing [] court records, [the moving party] has the burden to ‘justify the sealing.’”  (McNair, supra, 234 Cal.App.4th at p.32.)

Discussion

Defendants seek to seal copies of Defendants’ tax returns and audit reports attached as Exhibit A to the Declaration of Neil Eddington submitted in support of the instant motion to seal. 

Overriding Interest

Defendants assert that there is an overriding interest in sealing nearly the entirety of Defendants tax returns and audit reports because these documents contain Defendants’ confidential financial information.

“Under the common law right of access, court records are presumed to be ‘“open to the public unless they are specifically exempted from disclosure by statute or are protected by the court itself due to the necessity of confidentiality.”’”  (In re Marriage of Tamir (2021) 72 Cal.App.5th 1068, 1078.)  “Public access to civil proceedings serves to (i) demonstrate that justice is meted out fairly, thereby promoting public confidence in such governmental proceedings; (ii) provide a means by which citizens scrutinize and check the use and possible abuse of judicial power; and (iii) enhance the truthfinding function of the proceeding.”  (NBC Subsidiary (KNBC-TV), Inc. v. Superior Court (1999) 20 Cal.4th 1178, 1219.)  Thus, documents may only be sealed if “(i) there exists an overriding interest supporting closure and/or sealing; (ii) there is a substantial probability that the interest will be prejudiced absent closure and/or sealing; (iii) the proposed closure and/or sealing is narrowly tailored to serve the overriding interest; and (iv) there is no less restrictive means of achieving the overriding interest.”  (Id. at p.1218.) 

“In terms of the overriding interest requirement of a closure or sealing order, NBC Subsidiary identifies two separate elements. The first element requires the identification of an overriding interest.”  (Universal City Studios, Inc. v. Superior Court (2003) 110 Cal.App.4th 1273, 1283.)  “The second element of the overriding interest analysis is there must be a substantial probability that it will be prejudiced absent closure or sealing.”  (Ibid.) 

In California there is a clear longstanding right to privacy of financial documents.  (See Valley Bank of Nevada v. Superior Court (1975) 15 Cal.3d 652, 655; see also Burrows v. Superior Court (1974) 13 Cal.3d 238, 243, [“A bank customer's reasonable expectation is that, absent compulsion by legal process, the matters he reveals to the bank will be utilized by the bank only for internal banking purposes.”]; see e.g. Gov. Code, § 7460, [California Right to Financial Privacy Act].) 
            Here, Defendants present the declaration of Matthew Vitorino – the Chief Financial Officer for Out West Restaurant Group, Inc., which provides human resources, payroll, accounting, and finance support to Defendants – to support Defendants’ assertion that there is an overriding interest in sealing the tax returns and audit reports.  (Vitorino Decl. ¶ 1.)  As the Chief Financial Officer for the company that provides accounting and finance support to Defendants, Vitorino is familiar with Defendants’ financial records.  (Vitorino Decl. ¶ 2.)  “Defendants are private companies not subject to any public reporting requirements.”  (Vitorino Decl. ¶ 3.)  Moreover, “[a]ll financial documents, including financial statements, balance sheets, profit and loss statements, audit reports, loan documents, cash flow statements, and income statements are maintained by Defendants in confidence and secrecy.”  (Vitorino Decl. ¶ 3.)  The tax returns and audit reports which are maintained in confidence “contain highly-sensitive and confidential information that, if made publicly available, could be used by Defendants’ competitors to gain an unfair competitive advantage against Defendants.”  (Vitorino Decl. ¶ 3.)  Thus, Vitorino asserts that it would be highly prejudicial to Defendants to publicly disclose these records.  (Vitorino Decl. ¶ 3.) 

In light of the fact that Defendants seek to seal financial documents that are maintained in confidence and that disclosure of these documents could be prejudicial and used by Defendants’ competitors, Defendants sufficiently show an overriding interest in seal Defendants’ tax returns and audit reports attached as Exhibit A to the Declaration of Neil Eddington submitted in support of the instant motion to seal.

The Proposed Redactions are Narrowly Tailored

Defendants seek to seal nearly the entirety of the tax returns and audit reports attached as Exhibit A to the Declaration of Neil Eddington submitted in support of the instant motion to seal except for the introduction for the “Report of Independent Auditors.”  (Eddington Decl., Exh. A.)  Because the entirety of the tax returns and audit reports consists of Defendants’ confidential financial information, the proposed sealing of the nearly the entirety of Defendants’ tax returns and audit reports is narrowly tailored to protect the confidential interest in said documents not being disclosed.

Accordingly, Defendants’ motion to seal is GRANTED.

CONCLUSIONS AND ORDER

Based on the foregoing, Defendants Cerca Trova Restaurant Concepts, Inc. and Cerca Trova Steakhouse L.P.’s motion to seal Exhibit A to the Declaration of Neil Eddington submitted in support of the instant motion to seal is GRANTED.

Plaintiffs must electronically file under seal an UNREDACTED version of Exhibit A to the Declaration of Neil Eddington submitted in support of the instant motion to seal FORTHWITH.

Defendants are ordered to file proof of service of the instant order on all other parties within 5 days.

DATED: May 13, 2025                                                          ___________________________

                                                                                          Elaine Lu

                                                                                          Judge of the Superior Court