This lawsuit involves breach of a confidential settlement agreement.  In motion briefing, both sides relied on and filed the subject agreement.  Both sides also filed (unopposed) motions to seal it. 

These two Orders from Judge Conrad (Interim Order, [Final] Order on Motions to Seal) again confirm that our Business Court Judges don’t own rubber stamps.  They read every word of every motion, even motions that are unopposed.  In this case, Judge Conrad denied the parties’ motions to seal because, after giving them two chances, the movants failed to show that they would be harmed by making the settlement agreement public.

In the first, Interim Order, Judge Conrad explained that court filings are presumptively public, so motions to seal must include facts that warrant sealing.  Sure, the parties’ agreement to keep the settlement agreement confidential was a factor, but it wasn’t determinative.  Movants still had to demonstrate that public disclosure will cause them “serious harm.” The initial briefs did not articulate any harm, so instead of denying the motions, Judge Conrad allowed them to submit supplemental briefing.

Only one of the parties filed a supplemental brief. It argued that certain information in the settlement agreement, specifically the settlement amount, ownership percentage, and payment schedule could “potentially cause serious harm” including harm to “competitive standing” and “relationships with investors and potential investors.”  In the second, [Final] Order on Motions to Seal, Judge Conrad again made clear that cryptic, vague and conclusory statements like these won’t do.  The Court does not seal filings as a matter of course.  The Courthouse and its filings should remain public “in all but the unusual circumstances.” Here, the movant alleged potential serious harm but didn’t explain how harm would or could come to pass if the settlement agreement became public. On balance, Judge Conrad held that movant’s statements about potential future harm were too vague to justify sealing the agreement, particularly when considering the public interest in being able to see the document, which Judge Conrad noted was at the very center of this dispute.  Judge Conrad denied the motions to seal.

Takeaways:

Never assume unopposed motions will be granted.  This is another reminder to always make a proper showing in motions before the Business Court, even if the motion is unopposed. 

For motions to seal, more is better.  For comparison to the motions Judge Conrad denied, here’s a link to a recent Order by Judge Bledsoe granting a motion to seal.  In Judge Bledsoe’s case, the movant didn’t just make allegations and state conclusions.  It provided the Court a 10-page affidavit explaining the commercial sensitivity of the information and how the movant would be harmed if it became public.  This is not to say affidavits are always required to demonstrate seal-ability. It simply confirms that when it comes to explaining why something should be sealed, more is probably better.