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Center for Auto Safety v. Chrysler Group, LLC

United States Court of Appeals, Ninth Circuit

January 11, 2016

THE CENTER FOR AUTO SAFETY, Intervenor-Appellant,
v.
CHRYSLER GROUP, LLC, Defendant-Appellee

Argued and Submitted October 20, 2015, Pasadena, California

Appeal from the United States District Court for the Central District of California. D.C. No. 2:13-cv-08080-DDP-VBK. Dean D. Pregerson, District Judge, Presiding.

SUMMARY[**]

Sealed Documents

The panel vacated the district court's order denying The Center for Auto Safety's motions to intervene and unseal documents filed to support and oppose a motion for preliminary injunction in a putative class action between Chrysler Group, LLC and certain named plaintiffs, and remanded for further proceedings.

A party seeking to seal a judicial record bears the burden of overcoming a strong presumption in favor of access to court records by showing " compelling reasons," and the court must then balance the compelling interests of the public and the party seeking to keep the judicial record secret. Under an exception for sealed materials attached to a discovery motion unrelated to the merits of a case, a party seeking to seal the record need only satisfy a less exacting " good cause" standard. When deciding what test to apply to a motion to unseal a particular court filing - the presumptive " compelling reasons" standard or the " good cause" exception - the court has often deployed the terms " dispositive" and " nondispositive."

The panel presumed that the instant motion for preliminary injunction was technically nondispositive. The panel held that public access to filed motions and their attachments did not depend on whether the motion was technically " dispositive; " but rather, public access turned on whether the motion was more than tangentially related to the merits of the case. The panel concluded that plaintiffs' motion for preliminary injunction was more than tangentially related to the merits. The panel remanded for the district court to consider the documents under the compelling reasons standard.

Concurring, District Judge Sessions wrote separately to express his belief that reversal was warranted even under the binary approach endorsed by the dissent because the preliminary injunction at issue was literally " dispositive" of plaintiffs' request that Chrysler issue notice to its customers.

Judge Ikuta dissented because she believed that the majority opinion overruled circuit precedent and vitiated Fed.R.Civ.P. 26(c). Judge Ikuta would employ the " binary approach" which holds that the public's presumed right of access applied to sealed discovery documents attached to a dispositive motion, but did not apply to sealed discovery documents attached to a nondispositive motion.

Jennifer D. Bennett (argued) and Leslie A. Bailey, Public Justice PC, Oakland, California, for Intervenor-Appellant.

Thomas H. Dupree, Jr. (argued) and Sarah G. Boyce, Gibson, Dunn & Crutcher LLP, Washington, D.C.; Kathy A. Wisniewski, John W. Rogers, and Stephen A. D'Aunoy, Thompson Coburn LLP, St. Louis, Missouri; Rowena Santos, Thompson Coburn LLP, Los Angeles, California, for Defendant-Appellee.

Before: Sandra S. Ikuta and John B. Owens, Circuit Judges and William K. Sessions,[*] District Judge.

OPINION

John B. Owens, Circuit Judge:

The Center for Auto Safety (CAS) appeals from the district court's order denying CAS's motions to intervene and unseal documents filed in a putative class action lawsuit between Chrysler Group, LLC (Chrysler) and certain named plaintiffs. Because the district court applied the incorrect standard when evaluating the motion to unseal these documents, we vacate and remand for further proceedings.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

In 2013, plaintiffs filed a putative class action alleging defects in a part found in certain Chrysler vehicles.[1] As part of the discovery process, the parties entered into a stipulated protective order. The protective order permitted each party to designate certain documents as " confidential," and required any party that later wished to attach a " confidential" document to a court pleading to apply to do so under seal.

In 2014, plaintiffs moved for a preliminary injunction to require Chrysler to notify the proposed class of the alleged risks its vehicles presented. Plaintiffs and Chrysler attached " confidential" discovery documents to their memoranda supporting and opposing the motion. Consistent with the stipulated protective order, both parties applied to the district court to file the documents under seal, and the district court granted the motions. The district court eventually denied the motion for preliminary injunction.

Shortly before the district court denied plaintiffs' motion for preliminary injunction, CAS filed motions to intervene and unseal the " confidential" documents filed to support and oppose the motion for preliminary injunction. CAS argued that only " compelling reasons" could justify keeping these documents under seal, while Chrysler contended that it need only show " good cause" to keep them from the public's view.

The district court reviewed the relevant Ninth Circuit case law and other district courts' attempts to apply it to a motion for preliminary injunction. While ordinarily a party must show " compelling reasons" to keep a court document under seal, Kamakana v. City & County of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006), the district court relied on language in our cases which provides that when a party is attempting to keep records attached to a " non-dispositive" motion under seal, it need only show " good cause," id. at 1180. While recognizing that " [t]here is little clarity as to what, exactly, constitutes a 'dispositive' motion," and that our circuit has not articulated the difference between a dispositive and nondispositive motion,[2] the district court decided to read " dispositive" to mean that unless the motion could literally lead to the " final determination on some issue," a party need show only good cause to keep attached documents under seal. That was especially true in this case, the district court believed, as the motion for preliminary injunction here sought " notice of potential problems . . . to thousands of purchasers," and " was not a motion to temporarily grant the relief ultimately sought in [the] underlying suit." Accordingly, the district court found that the motion for preliminary injunction here was nondispositive, applied the good cause standard to the documents filed under seal, and concluded that good cause existed to keep them from the public's view.[3]

II. STANDARD OF REVIEW

We review a district court's decision to unseal court records for an abuse of discretion. Blum v. Merrill Lynch Pierce Fenner & Smith, Inc., 712 F.3d 1349, 1352 (9th Cir. 2013). Where " the district court's decision turns on a legal question, however, its underlying legal determination is subject to de novo review." San Jose Mercury News, Inc. v. U.S. Dist. Court-- N.D. Cal. (San Jose ), 187 F.3d 1096, 1100 (9th Cir. 1999).

" We have jurisdiction because an order denying a motion to unseal or seal documents is appealable either as a final order under 28 U.S.C. § 1291 or as a collateral order." Oliner v. Kontrabecki, 745 F.3d 1024, 1025 (9th Cir. 2014) (internal quotation marks and citation omitted).

III. ANALYSIS

A. Standard to File Documents Under Seal

" It is clear that the courts of this country recognize a general right to inspect and copy public records and documents, including judicial records and documents." Nixon v. Warner Commnc'ns Inc., 435 U.S. 589, 597, 98 S.Ct. 1306, 55 L.Ed.2d 570 (1978). Following the Supreme Court's lead, " we start with a strong presumption in favor of access to court records." Foltz v. State Farm Mut. Auto Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003). The presumption of access is " based on the need for federal courts, although independent--indeed, particularly because they are independent--to have a measure of accountability and for the public to have confidence in the administration of justice." United States v. Amodeo ( Amodeo II ), 71 F.3d 1044, 1048 (2d Cir. 1995); see also Valley Broad. Co. v. U.S. Dist. Court--D. Nev., 798 F.2d 1289, ...


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