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SolarCity Corporation v. Salt River Project Agricultural Improvement and Power District

United States District Court, D. Arizona

December 8, 2017

SolarCity Corporation, Plaintiff,
v.
Salt River Project Agricultural Improvement and Power District, Defendant.

          ORDER

          DOUGLAS L. RAYES UNITED STATES DISTRICT JUDGE

         Before the Court are Plaintiff SolarCity Corporation's motion to seal (Doc. 268), and Defendant Salt River Project Agricultural Improvement and Power District's motion to seal (Doc. 295). Neither party filed a responsive motion or requested oral argument. For the following reasons, Plaintiff's motion (Doc. 268) is granted and Defendant's motion (Doc. 295) is granted in part and denied in part.

         I. Legal Standard

         Where, as here, parties seek leave to file under seal documents attached to a dispositive motion, they must show compelling reasons for doing so. Pintos v. Pac. Creditors Ass'n, 605 F.3d 665, 678-79 (9th Cir. 2009) (citing Kamakana v. City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006)). The standard is high because the resolution of a dispute on the merits “is at the heart of the interest in ensuring the ‘public's understanding of the judicial process and of significant public events.'” Kamakana, 447 F.3d at 1179 (citation omitted).

         II. Plaintiff's Motion to Seal (Doc. 268)

         Plaintiff seeks to file under seal: an unredacted version of its Renewed Motion for Summary Judgment (Motion); an unredacted version of its Separate Statement of Undisputed Facts (SSUF); and unredacted versions of the exhibits cited in the Motion and the SSUF. (Doc. 268 at 2.) The documents included in this request fall into three categories, which the Court discusses in turn.

         First, Plaintiff seeks to seal “certain portions of deposition transcripts” of two employees because they contain “highly sensitive business information and trade secrets.” (Id. at 4.) Specifically, these depositions discuss “strategic pricing decisions and their effect on internal financial metrics, ” the public disclosure of which Plaintiff argues would give its competitors an advantage in “determining how to profitably price their own offerings and better compete” against Plaintiff. (Id.) Importantly, because the portions Plaintiff seeks to seal concern service areas not at issue in this case, disclosure offers limited assistance to the public in better understanding the judicial proceedings. See e.g., Aviva USA Corp. v. Vazirani, 902 F.Supp.2d 1246, 1273-74 (D. Ariz. 2012) (finding that sealing document did not interfere with understanding of the judicial process because the dispositive motion did not address information found in that document). The Court therefore finds that compelling reasons justify sealing these portions of the identified depositions.

         Next, Plaintiff requests that the Court seal portions of its Motion and SSUF containing private consumer information. Plaintiff argues that release of this information would result in an invasion of privacy interests of third parties, and that consumers' identities should be sealed because disclosure is not necessary for the public to understand the parties' positions or the Court's rulings. Plaintiff notes, correctly, that consumer identities become a matter of the public record if they testify at trial. The Court finds that compelling reasons justify sealing the identified portions of Plaintiff's Motion and SSUF.

         Finally, at Defendant's request, Plaintiff has lodged under seal a series of exhibits that Defendant designated as confidential pursuant to the Court's Protective Order. Plaintiff “does not agree that th[ese] exhibits should be sealed, but has agreed to lodge them under seal” in accordance with the Court's Protective Order and Local Rule 5.6. (Doc. 268 at 2; Doc. 56.) In turn, Defendant filed a separate motion to seal these documents, which the Court discusses below.

         III. Defendant's Motion to Seal (Doc. 295)

         Defendant seeks to have sealed 20 exhibits that Plaintiff filed in support of its motion for partial summary judgment, arguing that these exhibits contain information that “affect[s] net revenue” and is “not the sort of information a utility typically makes public.” (Doc. 295 at 2-5.) Defendant offers a brief explanation as to why each exhibit should be sealed. For example, Defendant argues that Exhibit 8 consists of internal emails discussing pricing decisions “that necessarily affect” Defendant's net revenue. (Doc. 295 at 2.) Defendant also argues that Exhibit 9 consists of an internal presentation concerning strategic decision making that is “related to issues that affect [Defendant's] overall net revenue.” (Id.) In support of its arguments, Defendant cites four cases in which business confidentiality and competitive standing have been deemed sufficient reasons to justify sealing court records. (Id. (citing Ctr. for Auto Safety v. Chrysler Grp. LLC, 809 F.3d 1092, 1098 (9th Cir. 2016); Bean v. Pearson Educ., Inc., No. CV 11-8030-PCT-PGR, 2013 WL 2455930, at *4 (D. Ariz. June 5, 2013); TriQuint Semiconductor, Inc. v. Avago Techs. Ltd., No. CV 09-1531-PHX-JAT, 2011 WL 4947343, at *2 (D. Ariz. Oct. 18, 2011); Aviva, 902 F.Supp.2d at 1273).)

         The Court agrees that, in some circumstances, business confidentiality and competitive standing can be compelling reasons justifying sealing court records, and acknowledges that there is some plausibility to Defendant's concerns. But the Court also has doubts as to the concreteness of the harm Defendant claims would result from public disclosure of the documents at issue. For example, Defendant argues that certain information it seeks to seal is not “the kind of information a utility would ordinarily make public.” (Doc. 295 at 4.) Simply because information is not ordinarily made public does not mean its publication necessarily results in harm. Lawsuits regularly result in the public disclosure of information that otherwise would remain private. Without a more specific explanation linking public disclosure with concrete harm, the Court is left with guesswork.

         Moreover, Defendant's requests seem overbroad. In close cases involving some degree of conjecture as to the harm that would result from public disclosure of information, courts may grant a motion to seal provided that sealing the document will not interfere with the public's interest in understanding the judicial process. See Aviva USA Corp., 902 F.Supp.2d at 1273. The Court, however, has reviewed the exhibits at issue and finds that the information contained within is valuable to the public's understanding of the case.

         Plaintiff brings claims under the Sherman Antitrust Act. The central allegation in this case is that Defendant has monopoly power over the electrical grid and has used a pricing strategy to eliminate competition from Plaintiff and other distributed solar entities by assessing a penalty against customers who use solar energy systems but still need grid access. (Doc. 39 ¶¶ 2, 4.) Plaintiff alleges that this pricing strategy exploits the practical reality that customers using solar energy systems are unable to completely disconnect from the grid. ...


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