Case Number: BC530555    Hearing Date: August 12, 2014    Dept: 34

Moving Party: Defendant Industrial Electronic Engineers Inc. (“IEE” or “defendant”)

Resp. Party: None

TENTATIVE RULING:

Defendant’s unopposed motion to seal is GRANTED.

BACKGROUND:

Plaintiff commenced this action on 12/13/13. Plaintiff filed a first amended complaint on 1/15/14. On 4/25/14, defendant filed a second amended complaint against defendants for: (1) breach of contract; (2) trespass; (3) nuisance; (4) negligence; (5) negligence per se; (6) Health & Safety Code §§ 25300-25395.45; (7) declaratory relief; (8) contractual indemnity; (9) fraudulent transfers; (10) alter ego; and (11) breach of implied covenant of good faith and fair dealing. Plaintiff has leased to defendant Industrial Electronic Engineers Inc. (“IEE”) several properties since 1966. (SAC ¶¶ 9-11.) IEE has conducted manufacturing operations on the property and, incident to this, IEE has used volatile organic compounds, which has contaminated the soil and groundwater below the property. (Id., ¶ 12.) Plaintiff alleges that IIE has been aware of the contamination but has failed to remediate it or timely inform plaintiff about it. (Ibid.) Plaintiff did not learn about the contamination until 2011, and thereafter caused an environmental survey of the property to be performed, which showed the presence of hazardous substances. (Ibid.) Plaintiff alleges that defendant Whinfrey has been president and CEO of IEE since 2010. (Id., ¶ 13.) Plaintiff alleges that Donald Gumpertz and his daughters were alter egos of IEE. (See id., ¶¶ 14-16.) After Donald Gumpertz’s death in 2012, most of the shares of IEE were owned by his three daughters, defendants Janis Iceland, Marcia Gumpertz, and Sandra Whitman. (Id., ¶ 15.)

ANALYSIS:

IEE requests that the Court seal certain documents filed by plaintiff in its opposition to a previous motion by defendant Marcia Gumpertz (which was granted on 7/7/14). These documents consist of IEE financial statements and valuation documents.

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. (CRC, 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. (CRC, 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. (CRC, rule 2.551(b)(4) and (d).) The lodged record is conditionally under seal pending the judge’s determination of the motion or application. (CRC, rule 2.551(b)(4).)

Here, the motion complies with rule 2.551. The items sought to be sealed were previously lodged provisionally under seal by plaintiff with its opposition to M. Gumpertz’s motion to quash service of summons.

Pursuant to CRC, 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 (4) No less restrictive means exist to achieve the overriding interest.

(CRC 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, in order to prevail on his motion, the moving party must present a specific enumeration of the facts sought to be withheld and the specific reasons for withholding them. (H.B. Fuller Co., 151 Cal.App.4th at 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. Superior Court (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 p. 1210.) There is a presumption of openness in civil court proceedings. (Id., at p. 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. Sup. Ct. (1999) 20 Cal.4th 1178, 1208-09, fn. 25; Champion v. Sup. Ct. (1988) 201 Cal.App.3d 777, 787.) A proposed sealing must be narrowly tailored to serve the overriding interest, such as by sealing portions of pleadings or redacting particular 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. (CRC Rule 2.551(b)(1).)

Financial information involving confidential matters relating to a party’s business operations may be sealed where “public revelation of these matters would interfere with [the party’s] ability to effectively compete in the marketplace” and “if made available to the public, there is a substantial probability that their revelation would prejudice the foregoing legitimate interests of [party].” (Universal City Studios, Inc. v. Superior Court (2003) 110 Cal.App.4th 1273, 1283.)

Defense counsel declares that defendant seeks to file under seal those documents which were lodged by plaintiff and which, pursuant to a protective order, were designated as “confidential.” (Sinclair Decl., ¶ 4.) Defense counsel declares that the documents contain confidential and “highly sensitive” proprietary records. (Id., ¶ 5.) Counsel declares that all parties have agreed that the documents should remain confidential. (Ibid.) This declaration is sufficient to support the request to seal the documents.

Accordingly, defendant’s motion to seal is GRANTED.