In Encana Oil & Gas (USA), Inc. v. Zaremba Family Farms, Inc., (1:12-cv-369), the Honorable Joseph G. Scoville, United States Magistrate Judge, issued an Opinion describing the circumstances under which the Court may properly grant a request to file a sealed complaint. The underlying litigation concerned an alleged breach of a letter of intent concerning the acquisition of mineral rights. Plaintiff asked that the complaint be filed under seal, citing the confidential terms of the letter of intent and the potential harm that disclosure would have on its competitive standing.
The Magistrate Judge denied plaintiff's request to seal. It first noted "the strong presumption of public access to court materials," rooted in the First Amendment and the common law. That presumption may be overcome only by "a particularized special need for confidentiality, such as when trade secrets, national security, or certain privacy rights . . . are implicated." Ultimately, the inquiry turns on whether "interests of privacy outweigh the public's right to know." The Magistrate emphasized the Court's role as gatekeeper, required to scrutinize such requests and not merely abide by the agreement of the parties to seal documents.
Turning to the instant case, the Magistrate Judge held that plaintiff did "not come close to meeting its substantial burden to overcome the presumption of access to judicial records." Plaintiff failed to demonstrate how its competitive interests would be harmed by filing an unsealed complaint. Such confidential treatment is reserved for "rare cases (such as those involving the interest of innocent minor parties)." In closing, the Magistrate Judge observed that "the parties are privileged to negotiate in secret, but they must litigate in public."© 2013 Varnum LLP