Judge Mel Red Recana, Case Number: 23STCV10045, Date: 2024-06-13 Tentative Ruling

The Court considered the moving papers. Defendant McDonald’s USA, LLC’s Motion to Seal is DENIED.

Weather Group, LLC and Entertainment Studios Networks, Inc. (collectively, Plaintiffs) filed a Complaint on May 4, 2023 against McDonald’s USA, LLC, (Defendant) alleging a single cause of action for Fraud — False Promise (Civ. Code § 1711).

The Complaint alleges the following: Prominent American corporations promised to take an active role in remedying racial injustice after George Floyd’s murder ignited nationwide protests. (Complaint, ¶ 1.) Defendant only pledged $1 million despite being one of the largest public corporations in America. (Id. at ¶ 2.) Plaintiffs are part of a conglomerate of related media companies (“Allen Media Group” or “AMG), all owned by Byron Allen, an African American entrepreneur. (Id. at ¶ 4.) AMG is by far the largest African American-owned media company in the country, with Plaintiffs representing over 90 percent of that category. (Id. at ¶ 8.) Allen created the Black Owned Media Matters movement after the George Floyd murder to address racial discrimination and systemic racism in the media. (Id. at ¶ 5.)

AMG informed Defendant in March 2021 that AMG had been victims of racial discrimination in contracting in violation of 42 U.S.C. § 1981. (Id. at ¶ 6.) Plaintiffs allege that Defendant announced its “Four-Year Plan” in May 2021 to deflect from these serious allegations. (Id. at ¶ 7.) Plaintiffs further allege that Defendant’s plan included a commitment to increase its spending with Black Owned Media from two to five percent by 2024. (Id.)

Plaintiffs allege that in reliance on Defendant’s commitment, Plaintiffs spent considerable time and effort to put together a proposal for Defendant to advertise across their portfolio. (Id. at ¶ 9.) Defendant rebuffed Plaintiffs and proposed to spend only a tiny fraction of its advertising budget on Plaintiffs’ properties. (Id. at ¶ 10.) Defendant’s allocation left it well short of its public commitment. (Id.) In 2021 and afterwards, Defendant was not spending anywhere close to two percent of its national advertising budget on Black Owned Media under any definition. (Id. at 12.) Plaintiffs then filed suit.

Now the motion before the Court is Defendant McDonald’s USA, LLC’s Motion to Seal (the Motion). The Motion is unopposed. The Court notes that the documents subject to this Motion are documents belonging to Defense counsel Hueston Hennigan, LLP.

The governing rule here is Cal. Rules of Court, Rule 2.550(d) which states “that the court may order that a record be filed under seal only if it expressly finds facts that establish:

(1) There exists an overriding interest that overcomes the right of public access to the record;

(3) A substantial probability exists that the overriding interest will be prejudiced if the record is not sealed;

California law recognizes a constitutional right of access to court proceedings and court documents. (In Re Marriage of Tamir (2021) 72 Cal.App.5^th 1068, 1078. Also see McNair v. NCAA (2015) 234 Cal.App.4^th 25, 31.) This is because the public has an interest in observing and assessing the performance of its public judicial system in all civil cases and that interest strongly supports a general right of access in ordinary civil cases. (In Re Marriage of Tamir, supra, at 31.)

Accordingly, the first step to seal records within a civil case is for Defendant to present an interest that overcomes the right of public access. Here, it is not the client seeking for documents to be sealed, but Defense counsel. Defense counsel asserts that the interest is the confidentiality of its negotiated and discounted billing rates that it charges its client – McDonald’s USA, LLC – for the work on this matter. The documents that counsel would like sealed contain references to its special billing rates for its client. Defense counsel argues that if the documents were not sealed, counsel would be prejudiced and could be placed “at a disadvantage in the future.” (Moving Papers, 2:8-9.)

The Court declines to seal these documents. First, it is unclear as to how Defense counsel may be placed at a disadvantage in the future. Second, the billing rates of a law firm are not sufficient to overcome the presumed right to access to court proceedings for the public. This right is based in the First Amendment of the Constitution of the United States. Although this presumption is not absolute and can be overcome upon a proper showing (McNair, supra, at 31), Defense counsel has not made such a showing. Therefore, the Motion is denied.

Accordingly, Defendant McDonald’s USA, LLC’s Motion to Seal is DENIED.

Superior Court of California

County of Los Angeles

Case No.: 23STCV10045