Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_08-cv-01549/USCOURTS-casd-3_08-cv-01549-6/pdf.json

Nature of Suit Code: 380
Nature of Suit: Other Personal Property Damage
Cause of Action: 28:1332 Diversity-Property Damage

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

KERRIE STONE, JUSTINA

RODRIGUEZ, FRANK BRIGHTWELL,

Plaintiffs,

CASE NO. 08cv1549 WQH

(WMC)

ORDER

vs.

ADVANCE AMERICA, CASH

ADVANCE CENTERS, Inc., ADVANCE

AMERICA, CASH ADVANCE

CENTERS OF CALIFORNIA, LLC,

Defendants.

HAYES, Judge:

The matters before the Court are the Request to File Documents Under Seal Pursuant

to Protective Order filed by Plaintiffs (ECF No. 129, 138, 151), and the Motions to Seal (ECF

No. 148, 166) filed by Defendants. 

BACKGROUND

On September 30, 2010, October 18, 2010, and on November 1, 2010, Plaintiffs filed

Requests to File Documents Under Seal. (ECF No. 129, 138, 151). On October 7, 2010, this

Court issued an Order regarding the September 30, 2010, Request to File Under Seal (ECF No.

129) filed by Plaintiffs, and on November 16, 2010, this Court issued an Order regarding the

November 1, 2010, Request to file Documents Under Seal (ECF No. 151) filed by Plaintiffs.

The Court noted that “Plaintiff[s] failed to provide any basis for sealing the documents aside

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 Defendants also contend that these same materials were filed as Exhibits 2-6 and 15-

17 to Plaintiffs’ Opposition to Defendants’ Motion for Summary Judgment at (ECF No. 139;

139-3; 139-4; 139-5; 139-6; 139-7; 139-16; 139-17; 139-18) which should be filed under seal

for the same reasons discussed here. 

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from Defendants’ designation of certain documents as ‘confidential’ pursuant to the Protective

Order.” (ECF No. 135 at 2; 163 at 2). The Court concluded that “[i]n the absence of

‘compelling reasons,’ the Court [could not] seal the documents.” Id. However, the Court held

that it would “not deny Plaintiffs’ Request to File Documents Under Seal without providing

Defendants with an opportunity to meet the burden required to seal the documents at issue.”

Id. 

On October 28, 2010, Defendants filed a Motion to Seal (ECF No. 148). On November

19, 2010, Plaintiffs filed a Statement of Non-Opposition to Defendants’ Motion to Seal (ECF

No. 164). 

On December 7, 2010, Defendants filed a Second Motion to Seal (ECF No. 166). On

December 23, 2010, Plaintiffs filed a Statement of Non-Opposition to Defendants’ Second

Motions to Seal (ECF No. 169). 

DISCUSSION 

Defendants seek to file Exhibits 14, 26-27 to the Declaration of Marita Murphy

Lauinger “Lauinger” (ECF Nos. 131-14; 131-26; 131-27) under seal on the grounds that the

documents contain confidential information regarding Defendants’ business including its

banking relationships and marketing strategies which could cause competitive harm if made

public. In addition, Defendants seek to file under seal Exhibits 20-24 and 32-34 to the

Lauinger Declaration (ECF Nos. 131-20; 131-21; 131-22; 131-23; 131-24; 131-31; 131-32;

131-33; 131-34) which contain annual reports and regulatory examination reports to the

California Department of Corporations from years 2005 through 2010. Defendants contend

these documents are protected from disclosure by the California Public Records Act, Cal.

Gov. Code Section 6254, and contain “strategic business information” regarding “volume

and market share.”1

 (ECF No. 148-1 at 6-7). Defendants also seek to file Exhibit 8 to

Plaintiffs’ Reply Brief in Support of Class Certification (ECF Nos. 152-9) under seal on the

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grounds that it contains confidential communications from Defendants to the California

Department of Corporations regarding a regulatory examination. 

Defendants contend that the request to seal is narrowly tailored because Defendants

have consented to public filing of “a large portion” of the information that Plaintiffs

previously sought to seal. (ECF No. 148-1 at 2). Defendants specifically consent to the

following documents to be filed in the public record: (1) Excerpts of the Deposition of

Scott Goodman (ECF No. 131-5); and (2) Memorandum Dated October 23, 2009 regarding

California agreements and notices (with attachment) (ECF No. 131-35). Defendants have

also consented to certain documents to be filed in the public record with more limited

redaction than what was previously submitted by Plaintiffs which are attached as Exhibit A

to Defendants’ Motion to Seal as follows: (1) Exhibit 3 excerpts of the Deposition of

Charles H. “Chuck” Carter (ECF No. 131-3); (2) Exhibit 4 excerpts of the Deposition of

Laura Fricks (ECF No. 131-4); and (3) Exhibit 11 excerpts of the Deposition of Jean

Newman (ECF No. 131-11). See (ECF No. 148-1 at 10). 

“Historically, courts have recognized a ‘general right to inspect and copy public

records and documents, including judicial records and documents.’” Kamakana v. City and

County of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006) (quoting Nixon v. Warner

Communs., Inc., 435 U.S. 589, 597 & n.7 (1978)). Except for documents that are

traditionally kept secret, there is “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); see also

Kamakana, 447 F.3d at 1178-79. “A party seeking to seal a judicial record then bears the

burden of overcoming this strong presumption by meeting the compelling reasons standard. 

That is, the party must articulate compelling reasons supported by specific factual findings,

... that outweigh the general history of access and the public policies favoring disclosure,

such as the public interest in understanding the judicial process.” Kamakana, 447 F.3d at

1178-79 (citations and quotation marks omitted). The presumed right to access to court

proceedings and documents can be overcome “only by an overriding right or interest ‘based

on findings that closure is essential to preserve higher values and is narrowly tailored to

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serve that interest.’” Oregonian Publishing Co. v. United States District Court, 920 F.2d

1462, 1465 (9th Cir. 1990) (quoting Press-Enterprise Co. v. Superior Court, 446 U.S. 501,

510 (1985)).

“Under the compelling reasons standard, a district court must weigh relevant factors, 

base its decision on a compelling reason, and articulate the factual basis for its ruling,

without relying on hypothesis or conjecture.” Pintos v. Pacific Creditors Ass'n, 605 F.3d

665, 659 (9th Cir. 2010) (quotations omitted). “‘Relevant factors’ include the ‘public

interest in understanding the judicial process and whether disclosure of the material could

result in improper use of the material for scandalous or libelous purposes or infringement

upon trade secrets.’” Pintos, 605 F.3d at 659 n.6 (citing Hagestad v. Tragesser, 49 F.3d

1430, 1434 (9th Cir.1995)); see also Kamakana, 447 F.3d at 1179 ( “In general,

‘compelling reasons’ sufficient to outweigh the public's interest in disclosure and justify

sealing court records exist when such ‘court files might have become a vehicle for

improper purposes,’ such as the use of records to gratify private spite, promote public

scandal, circulate libelous statements, or release trade secrets.”) 

California Government Code Section 6254 provides that “nothing in this chapter

shall be construed to require disclosure of records that are any of the following: ...

[e]xamination, operating, or condition reports prepared by, on behalf of, or for the use of,

any state agency ... [i]nformation received in confidence by any state agency ....” Cal.

Govt. Code § 6254(d)(2), (4); see also 10 Cal. Code Regs. tit. 10, § 250.9.1 (listing the

records which are subject to public inspection; list does not include examinations and

annual reports or correspondence relating thereto). 

Exhibits 14, 20-24, 26-27 and 32-34 to the Lauinger Declaration and Exhibit 8 to

Plaintiffs’ Reply Brief in Support of Class Certification contain the following: (1)

Deposition testimony of Joachim Rudolph discussing Defendants’ relationship with its

bank; (2) annual reports for licensees engaged in business under the California deferred

deposit transaction law submitted to the California Department of Corporations for years

ending December 31, 2005 through 2009; (3) Defendants’ California broadcast media

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summary; (4) a table of bilingual mail quantities for California centers from 2006-2009; (5)

letters from the California Department of Corporations to Defendants regarding regulatory

examination reports dated March 12, 2007, November 24, 2008, and July 6, 2010; (6) a

letter to the California Department of Corporations from Defendants dated November 6,

2002. The Court finds that these documents contain trade secret information which might

become a vehicle for improper purposes in the hands of business competitors. Defendants

have shown compelling reasons that outweigh the public's interest in disclosure of these

materials and justify filing the documents under seal. 

 CONCLUSION

IT IS HEREBY ORDERED THAT: the Requests to File Documents Under Seal

(ECF No. 129, 138, 151) filed by Plaintiffs, and the Motions to Seal (ECF No. 148, 166) 

filed by Defendants are GRANTED. The following documents are filed under seal: 

Exhibits 14, 20-24, 26-27 and 32-34 to the Declaration of Marita Murphy Lauinger in

Support of Plaintiffs’ Motion for Class Certification (ECF No. 131-14; 131-20; 131-21;

131-22; 131-23; 131-24; 131-26; 131-27, 131-32; 131-33; 131-34), Plaintiffs’ Opposition

to Defendants’ Motion for Summary Judgment (ECF No. 139), Exhibits 2-6 and 15-17 to

the Declaration of Zach P. Dostartin Support of Plaintiffs’ Opposition to Defendants’

Motion for Summary Judgment (139-3; 139-4; 139-5; 139-6; 139-7; 139-16; 139-17; 139-

18), and Exhibit 8 to Plaintiffs’ Reply Brief in Support of Class Certification (ECF No.

152-9). 

DATED: February 11, 2011

WILLIAM Q. HAYES

United States District Judge

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