Judge: Michael P. Linfield, Case: 23STCV06825, Date: 2023-05-22 Tentative Ruling
Case Number: 23STCV06825 Hearing Date: May 22, 2023 Dept: 34
SUBJECT: Motion to Seal
Moving Party: Defendant
Focus Financial Partners, LLC
Resp. Party: None
SUBJECT: Verified Application to Appear as
Counsel Pro Hac Vice
Moving Party: Counsel
Applicant Scott Glass
Resp. Party: None
The
Motion to Seal is GRANTED.
The
Verified Application to Appear as Counsel Pro Hac Vice is GRANTED.
BACKGROUND:
On March 28, 2023,
Plaintiffs KSFB Management, LLC and Mark Segal filed their Complaint against
Defendants Focus Financial Partners, LLC and Goldman Sachs & Co. LLC on
causes of action arising from the Parties’ business relationship.
On March 29, 2023, Plaintiffs
filed their First Amended Complaint.
On April 11, 2023,
Defendant Focus Financial Partners, LLC filed its Motion to Seal. Defendant
Focus Financial Partners, LLC concurrently filed its Proposed Order.
On April 27, 2023,
Counsel Applicant Scott Glass filed: (1) Verified Application to Appear as
Counsel Pro Hac Vice; and (2) Proposed Order.
On May 8, 2023,
Plaintiffs and Defendant Focus Financial Partners, LLC filed their Stipulation
and Proposed Order regarding the Motion to Seal.
ANALYSIS:
I.
Motion to
Seal
A. Legal Standard
A party that requests that a record or portion
of a record be filed under seal must file a motion or an application for an
order sealing it. The motion must be accompanied by a supporting memorandum and
a declaration containing facts sufficient to justify the sealing. (Cal. Rules
of Court, rule 2.551(b)(1);¿Savaglio v Wal-Mart Stores, Inc.¿(2007) 149
Cal.App.4th 588, 597–601.) All parties that have appeared in the case must be
served with a copy of the motion or application. Unless the judge orders
otherwise, a party that already possesses copies of the records to be sealed
must be served with a complete, unredacted version of all papers as well as a
redacted version. (Cal. Rules of Court, rule 2.551(b)(2).)¿
¿¿
The moving party must lodge the record with
the court in a separate envelope when the motion or application is made, unless
good cause exists for not lodging it or it has been lodged previously. (Cal.
Rules of Court, rule 2.551(b)(4) and (d).) The lodged record is conditionally
under seal pending the judge's determination of the motion or application.
(Cal. Rules of Court, rule 2.551(b)(4).)¿
¿¿
Pursuant to California Rules of Court, rule
2.550(d), a judge may order that a record be filed under seal only if the judge
expressly finds facts that establish all the following:¿
¿¿
(1) There exists an overriding interest 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 proposed sealing is narrowly tailored, and¿¿
(5) No less restrictive means exist to achieve the overriding
interest. (Cal. Rules of Court, rule 2.550(d).)¿
¿¿
In ruling on a motion to seal, the court must
weigh the competing interests and concerns. This process necessitates (1)
identifying the specific information claimed to be entitled to protection from
public disclosure, (2) identifying the nature of the harm threatened by
disclosure, and (3) identifying and accounting for countervailing
considerations. (H.B. Fuller Co. v. Doe¿(2007) 151 Cal.App.4th 879,
894.) Therefore, to prevail on his or her motion, the moving party must present
a specific enumeration of the facts sought to be withheld and the specific
reasons for withholding them. (Id.¿at p. 904.)¿
¿¿
The California Supreme Court has held that the
First Amendment provides “a right of access to ordinary civil trial and
proceedings.” (NBC Subsidiary (KNBC-TV), Inc. v. Super. Ct. (1999) 20
Cal.4th 1178, 1212.) The court further noted its belief that “the public has an
interest, in all civil cases, in observing and assessing the performance of its
public judicial system.” (Id.,¿at 1210.) There is a presumption of
openness in civil court proceedings. (Id., at 1217.) This presumption
may apply to seemingly private proceedings. (Burkle v. Burkle (2006) 135
Cal. App.4th 1045, 1052 (divorce proceedings).) Therefore, it is up to this
Court to determine if that presumption has been overcome.¿
¿¿
Courts must find compelling reasons, prejudice
absent sealing and the lack of less-restrictive means, before ordering filed
documents sealed. (Hurvitz v. Hoefflin¿(2000) 84 Cal.App.4th 1232,
1246;¿NBC Subsidiary (KNBC-TV), Inc. v. Super. Ct. (1999) 20 Cal.4th
1178, 1208–09 n. 25;¿Champion v. Super. Ct. (1988) 201 Cal.App.3d 777,
787.) A compelling reason could include to protect confidential trade secrets,
which “have been recognized as a constitutionally protected intangible property
interest.” (DVD Copy Control Ass’n., Inc. v. Bunner¿(2003) 31 Cal.4th
864, 878, internal citations omitted.)¿
¿¿
A proposed sealing must be narrowly tailored
to serve the overriding interest, such as by sealing portions of pleadings or
redacting text. (In re Marriage of Burkle¿(2006) 135 Cal.App.4th 1045,
1052, 1070.) An application to seal must be accompanied by a declaration
containing facts sufficient to justify sealing. (Cal. Rules of Court, Rule
2.551(b)(1).)¿
¿¿
A “contractual obligation not to disclose can
constitute an overriding interest” is sufficient to justify sealing the
requested documents so long as the moving party establishes that disclosure of
the information will result in substantial prejudice. (Universal City
Studios, Inc. v. Super. Ct. (2003) 110 Cal. App. 4th 1273, 1283–84.)
B. Discussion
Defendant Focus Financial Partners, LLC requests that the
Court seal Exhibit B to the Complaint, which Defendant alleges is a
“confidential and business sensitive commercial agreement describing and
governing Focus’s relationship with KSFB” and that Defendant “will suffer
irreparable harm if such confidential information is available via the Court’s
public docket to its competitors, partner firms, and acquisition targets.”
(Motion to Seal, p. 2:2–5, 2:12–17.) Exhibit B is the entire agreement, and the
entirety of Exhibit B is the agreement. There does not appear to be a way to
more narrowly seal Exhibit B.
Regarding the items requested to be sealed,
the Court finds: (1) that there exists an overriding interest that overcomes
the right of public access to the record; (2) that the overriding interest
supports sealing the record; (3) that a substantial probability exists that the
overriding interest will be prejudiced if the record is not sealed; (4) that
the proposed sealing is narrowly tailored, and (5) that no less restrictive
means exist to achieve the overriding interest.¿¿
¿
The Court GRANTS Defendant Focus Financial
Partners, LLC’s Motion to Seal.
C.
Conclusion
Defendant Focus Financial Partners, LLC’s
Motion to Seal is GRANTED.
II.
Verified Application to Appear as Counsel Pro Hac Vice
Counsel Applicant Scott Glass seeks admission
to appear as counsel pro hac vice to
represent Defendant Focus Financial
Partners, LLC in this action, and to be
associated as co-counsel with Oleg Elkhunovich.
Counsel Applicant is a member in good
standing of the State of Texas. Counsel Applicant is also admitted as a member
in good standing of the United States District Court for the Southern District
of Texas and the United States District Court for the Western District of
Texas. (Verified Application, ¶ 4.)
Counsel Applicant has not appeared in
California state courts in the past two years. (Verified Application, ¶¶ 6–8.)
The application also provides that the $50 fee required to be admitted pro hac vice has been paid to the State
Bar of California. (Verified Application Glass, Decl. Elkhunovich, ¶ 3.)
The proof of service filed in support of these applications demonstrate
that service was made upon the State Bar at its San Francisco address. (Cal.
Rules of Court, rule 9.40(c)(1).)
Therefore, the Court GRANTS
the Verified Application to Appear as Counsel Pro Hac Vice.