1 RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit I.O.P. 32.1(b) File Name: 16a0175p.06 

### UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

_________________

R

UDD E QUIPMENT C OMPANY , I NC ., Plaintiff-Appellant ,

v

.

J OHN D EERE C ONSTRUCTION & F ORESTRY C OMPANY , Defendant-Appellee

. ┐ │ │ │ │ │ │ │ │ ┘ No. 16-5055

Appeal from the United St ates District Court for the Western District of Kentucky at Louisville. No. 3:14-cv-00703—David J. Hale, District Judge. Decided and Filed: July 27, 2016 Before: COLE, Chief Judge; BATCH ELDER and COOK, Circuit Judges.

_________________ COUNSEL
ON BRIEF: Brent R. Baughman, John K. Bush, Janet P. Jakubowicz, BINGHAM GREENEBAUM DOLL LLP, Louisville, Kentucky, for Appellant. Cory M. Curtis, BAKER & HOSTETLER LLP, Houston, Texas, M. Sc ott McIntyre, BAKER & HOSTETLER LLP, Cincinnati, Ohio, Justin T. Winquist, B AKER & HOSTETLER LLP, Denver, Colorado, for Appellee.

_________________ OPINION

_________________ COLE, Chief Judge. Rudd Equipment Company, Inc., appeals the order of the district court granting John Deere Construction & Forest ry Company’s motion to unseal this case. Immediately upon initiating this action, Rudd filed a motion to seal all f ilings, and indeed the very existence of this case, from public view. Although th e district court entered an order 

### >No. 16-5055 Rudd Equip. Co. v. John Deere Page 2

sealing the case, it la ter granted Deere’s request to unsea l. Because Rudd cannot show any countervailing privacy interest sufficient to outweigh the strong presumption in favor of public access to federal court records, we affirm.

I.
Rudd is a long-time authorized dealer of equipment manufactured by Hitachi Construction Equipment. In 2002, Deere beca me the exclusive North American wholesale supplier of Hitachi products and entered into renewed dealer ag reements to continue supplying equipment to Rudd. By October 2014, however, th e relationship had soured, and Deere notified Rudd of its intent to terminate those dealer agreements. At the same time, Deere initiated arbitration proceedings, as required by the agreem ents’ mandatory arbitration provisions, seeking a declaration of its right to terminate its agreements with Rudd.
Rudd opposes Deere’s claimed right of terminat ion, and notes that sa les and service of Hitachi equipment pursuant to th e agreements is a significant por tion of its business. Although Rudd agrees that arbitration is th e proper forum for this dispute, it nevertheless filed this action seeking injunctive relief to maintain the status quo of the agreements pe nding final resolution by the arbitration panel.
Contemporaneously with its complaint, Rudd fi led a motion to seal the case. According to Rudd, secrecy in this matte r is paramount: were any word of Deere’s contemplated termination of Rudd’s Hitachi busin ess—including “the very fact of this lawsuit”—to leak, Rudd maintains that its business would suffer “devastating consequences,” likely resulting in the “loss of Rudd’s existing and future customers, the la yoff (or preemptive departure) of many skilled and trained Rudd employees, significant diminuti on of the value of Rudd’s enormous financial investment in facilities, tools, and inventory . . . [and] loss of good will and harm to Rudd.”
Rudd submitted with its motion to seal a one-p age proposed order. Two weeks after the complaint was filed, on November 5, 2014, the distri ct court entered the order, before Deere submitted a response. On December 5, during an on- the-record telephonic st atus conference, the court asked the parties whether the case should re main under seal; Rudd’s c ounsel replied that it should, while Deere’s counsel was si lent. Over the next several m onths, both parties filed briefsNo. 16-5055 Rudd Equip. Co. v. John Deere Page 3

under seal. In February 2015, the parties met befo re a magistrate judge for a hearing on Rudd’s request for injunctive relief. At the magistra te judge’s suggestion, the hearing was converted into a mediation, the result of which was an “A greed Order” settling th e motion and addressing issues of interim relief during the pendency of th e arbitration. The Agreed Order was entered by the court in March 2015, also under seal.
A panel convened to arbitrate the dispute l earned of the Agreed Order and requested a copy, on the notion that the orde r providing for interim relief established the basis for the arbitration panel to wait until February 2016 for its hearing, rather than holding the hearing on a more expedited basis. 1 Deere’s counsel forwarded the Ag reed Order to the panel members without consulting Rudd, which prompted Rudd to attempt to retrieve the disclosed document and to file a motion for contempt against Deere. In response, Deere moved to vacate the court’s sealing order, arguing that the court failed to stat e findings that would justify sealing the case and that Rudd failed to overcome the presumptive right of pub lic access to court records.
In July 2015, the magistrate judge recommende d that Rudd’s contempt motion be denied, and that Deere’s motion to unseal be granted. The magistrate judge c oncluded that the order sealing all filings made no factual findings or le gal conclusions that w ould justify nondisclosure, that the relevant factors in this court’s balancin g test weighed strongly in favor of unsealing the case, and that Deere could not be found to have “waived” the public’s right of access. The magistrate judge also reasoned that Rudd’s claime d reliance on the seal was insufficient to justify a continued improper seal. The magistrate judge read our opinion in In re Knoxville NewsSentinel Co., Inc. , 723 F.2d 470, 478 (6th Cir. 1983), as commanding the court merely to “take account” of a party’s reliance on a sealing order when conducting the usual balancing test, and not, as Rudd preferred, a wholesale repudiation of th e balancing test in cases of reliance. The district court, emphasizing the c ourt’s independent duty to “consid er the public in terest without relying on either of the parties to represent that interest,” ag reed, and adopted the magistrate judge’s report and recommendation in full. Rudd does not ap peal the district co urt’s denial of its contempt motion, but does appeal the portion of the district c ourt’s order unsealing the case.

1 Although this lawsuit was intended by Rudd only to provide “interim” relief and “maintain the status quo” until the arbitration panel could render a decision, that arbitration process has itself been stayed pending the resolution of this appeal.No. 16-5055 Rudd Equip. Co. v. John Deere Page 4

II.
We begin with our jurisdiction to hear this appeal. Rudd asserts, and Deere does not dispute, that we have jurisdiction under the coll ateral order doctrine. See Cohen v. Beneficial Indus. Loan Corp. , 337 U.S. 541, 546–47 (1949). In Rudd’s view, the district court’s order conclusively determines a disputed question, which resolves an important issue completely separate from the merits of the action, and wh ich would be effectively unreviewable on appeal from a final judgment. See Starcher v. Corr. Med. Sys., Inc. , 144 F.3d 418, 422 (6th Cir. 1998); see also In re Sealed Case (Medical Records) , 381 F.3d 1205, 1209 (D.C. Cir. 2004). We agree.
As we have previously suggested, orders sealing a court’s records and denying public access to court documents can satisfy the collateral order doctrine. See Application of Nat’l Broad. Co., Inc. , 828 F.2d 340, 343 (6th Cir. 1987). The same goes for unsealing: This order “conclusively and finally determine[s] that the documents [will] not [be] protected from disclosure.” Sealed Case , 381 F.3d at 1209 (internal quotation marks omitted). Moreover, it would be effectively unreviewable absent this appeal, since the ultimate merits of this case will be decided by an arbitration pane l, by which time this case’s doc ket will have been unsealed and open to the public for some time. See In re Copley Press, Inc. , 518 F.3d 1022, 1025 (9th Cir. 2008) (“Secrecy is a one-way stre et: Once information is publishe d, it cannot be made secret again. An order to unseal thus co nclusively determines that the information will be public. For the same reason, such an order is effectively unreviewable on appeal from a final judgment.” (internal quotations , alterations, and c itations omitted)); Providence Journal Co. v. FBI , 595 F.2d 889, 890 (1st Cir. 1979) (“Once th e documents are surrendered pursuant to the lower court’s order, confidentiality will be lo st for all time. The status quo could never be restored.”).

We also conclude this is an issue “completely separate” fr om the merits of the underlying dispute between Rudd and Deere. Although disclosure of the docum ents would, it seems, affect Rudd’s bargaining power in its negotiations, seal ing the court’s docket would not “implicate any merits issue” related to Deere’s substantive right to terminate the agreements. Cf. Starcher , 144 F.3d at 424; see also Copley Press , 518 F.3d at 1025. Accordingly, we have jurisdiction to hear this appeal.No. 16-5055 Rudd Equip. Co. v. John Deere Page 5

III.

We review decisions of the di strict court to seal court docum ents or records, as well as orders lifting or modifying a seal, for abuse of discretion. Meyer Goldberg, Inc. v. Fisher Foods,
Inc. , 823 F.2d 159, 161 (6th Cir. 1987). But a court’ s discretion to seal it s records is bounded by a “long-established legal tr adition” of the “presumptive right of the public to inspect and copy judicial documents and files.” Knoxville News-Sentinel , 723 F.2d at 474. “In light of the important rights involved,” we have held that “t he district court’s deci sion is not accorded the traditional scope of ‘narrow review reserved for discretionary decisions based on first-hand observations.’” Id. at 476 (quoting United States v. Criden , 648 F.2d 814, 818 (3d Cir. 1981)). Instead, “[o]nly the most compelling reasons can justify non-disclosure of judicial records.” Id. (citations omitted).

A.
We have long recognized a “strong presump tion in favor of openness” regarding court records. See Brown & Williamson Tobacco Corp. v. FTC , 710 F.2d 1165, 1179 (6th Cir. 1983). In civil cases, as much as in criminal matters, “[t]he resolution of private disputes frequently involves issues and remedies aff ecting third parties or the gene ral public,” and secrecy serves only to “insulate[] the particip ants, mask[] impropriety, obscur[ e] incompetence, and conceal[] corruption.” Id.
Exceptions to this practice fall into two broad categories, the latter of which is relevant here: “[T]hose based on the need to keep orde r and dignity in the courtroom and those which center on the content of th e information to be disclosed to the public.” Id. In determining the appropriateness of sealing court records under this exception, we consider, among other things, the competing interests of the defenda nt’s right to a fair trial, the privacy rights of participants or third parties, trade secrets, and national security. See Nixon v. Warner Commc’ns, Inc. , 435 U.S. 589, 598 (1978); Brown & Williamson , 710 F.2d at 1179.
We recently clarified the “stark difference” be tween court orders entered to preserve the secrecy of proprietary informa tion while the parties trade disc overy, and the sealing of the court’s docket and filings: “The line between these two stages . . . is crossed when the partiesNo. 16-5055 Rudd Equip. Co. v. John Deere Page 6

place material in the court record,” and in this latter stage, “‘very different considerations apply.’” Shane Grp., Inc. v. Blue Cr oss Blue Shield of Mich. , No. 15-1544, 2016 WL 3163073, at *3 (6th Cir. J une 7, 2016) (quoting Joy v. North , 692 F.2d 880, 893 (2d Cir. 1982)). The public’s focus is not only on the litigation’s resu lt, but “also on the conduct giving rise to the case,” and in both circumstances, “the public is enti tled to assess for itself the merits of judicial decisions.” Id. Shielding material in court records, then, should be done only if there is a “compelling reason why certain documents or portions thereof should be sealed.” Id. Even in such cases, “the seal itself must be narrowly tail ored to serve that reaso n,” and should “‘analyze in detail, document by document, the propri ety of secrecy, providing reasons and legal citations.’” Id. (quoting Baxter Int’l, Inc. v. Abbott Labs. , 297 F.3d 544, 548 (7th Cir. 2002)).

B.
Applying these principles, the capacious se aling order in this case cannot stand. The district court was therefore justified in revising its order and lifting the seal.
To begin with, the district court erred in fa iling to make any findings or legal conclusions in support of the initial seal. When a district c ourt opts to seal court reco rds, it must set forth specific findings and conclu sions “which justify nondisc losure to the public.” Brown & Williamson , 710 F.2d at 1176. “[A] court’s failure to set forth those reasons—as to why the interests in support of nondisclo sure are compelling, why the in terests supporting access are less so, and why the seal itself is no broader than necessary,” is itsel f sufficient ground to vacate the seal. Shane Grp. , 2016 WL 3163073, at *4; see also Goodman v. Fuller , 960 F.2d 149 (6th Cir. 1992) (unpublished table decision) (“Where there is a challenge to the propriety of such a seal, however, and the district court, af ter weighing the conflicting interests, remains of the view that curtailment of the public’s right of access to the records of its c ourt system is justified, it is essential for the court to present a reasoned analysis explaining why.”).

The district court therefore did not abuse its discretion in vacating the sealing order. First, the court was fully within its authority to revisit its prior order. Mallory v. Eyrich , 922 F.2d 1273, 1282 (6th Cir. 1991) (“District cour ts have inherent power to reconsiderNo. 16-5055 Rudd Equip. Co. v. John Deere Page 7

interlocutory orders and reopen an y part of a case before entry of a final judgment. A district court may modify, or even rescind, such interl ocutory orders.” (inter nal citations omitted)).
We agree, moreover, with the district cour t’s conclusion that the relevant balancing factors weigh in favor of unsealin g the case. To reiterate, in making this determination, a court must balance the litigants’ privacy interests agai nst the public’s right of access, recognizing our judicial system’s strong presumption in favor of openness. Rudd offered scant eviden ce in favor of sealing the court’s record. Even taking Rudd at its word regarding the serious business consequences at stake should this case be unsealed, more is requ ired. As we ha ve explained, “[s]imply showing that the information would harm the company’s reputati on is not sufficient to overcome the strong common law presumption in favor of public access to court proceedings and records.” Brown & Williamson , 710 F.2d at 1179. That is especially true here, where the entity alleging harm from publicizing the mere existence of this case is the plaintiff—the party that chose to file suit.
In short, the harm that may befall Rudd should this case become public is simply not the sort of harm that sealing the c ourt’s record is aimed to prevent. Rudd cannot point to any trade secret, or privacy right of third parties, that a seal might legitimately protect. Indeed, many of Rudd’s proffered reasons for sealing—including the possible reactions of its employees and current and future customers—cut in favor of public access: “[T]he greater the public interest in the litigation’s subject matter, th e greater the showing necessary to overcome the presumption of access.” Shane Grp. , 2016 WL 3163073, at *3; see also Baxter , 297 F.3d at 546 (noting that, “[i]n civil litigation, only trade secrets, information covered by a recognized privilege (such as the attorney-client privilege), and information requi red by statute to be maintained in confidence (such as the name of a minor victim of a sexua l assault),” is typica lly enough to overcome the presumption of access).

C.
Two counter-arguments raised by Rudd warr ant brief discussion. The first is its contention that Deere “waived it s right to challenge” the sea ling order by “acquiesc[ing]” to filing under seal and failing to object as the case pr ogressed. But as th e magistrate judgeNo. 16-5055 Rudd Equip. Co. v. John Deere Page 8

accurately stated, Deere “could not have waived the public ’s First Amendment and common law right of access to court filings.” The “court’ s obligation to keep its records open for public inspection is not conditioned on an objection from anybody.” Shane Grp. , 2016 WL 3163073, at *5. Rather, the court has an independent “ob ligation to consider the rights of the public.” Knoxville News-Sentinel , 723 F.2d at 475. This is true “eve n if neither party objects to the motion to seal.” Shane Grp. , 2016 WL 3163073, at *4; see also Brown & Williamson , 710 F.2d at 1176 (noting that we may “reach the question” of the district cour t’s seal “on our own motion.”); cf. Tri-Cty. Wholesale Distri bs., Inc. v. Wine Grp., Inc. , 565 F. App’x 477, 490 (6th Cir. 2012) (Gwin, J., concurring and dissenting in part) (“The First Amendment access right extends to court dockets, record s, pleadings, and exhibits, a nd establishes a presumption of public access that can only be overcome by speci fic, on-the-record findings that the public’s interest in access to information is overcome by specific and compelling showings of harm.”).
Second, Rudd relies on one paragraph in our opinion in Knoxville News-Sentinel to argue that a different standard should gui de the district court’s discreti on in cases where, as here, one party relies on a seal in filing it s documents with the court. This is too thin a reed. In denying access to sealed court records in Knoxville News-Sentinel , we employed the traditional balancing test from Brown & Williamson , reasoning that sealing is appropr iate “when interests of privacy outweigh the public’s right to know,” 723 F.2d at 474, and emphasizing that “[o]nly the most compelling reasons can justify non-di sclosure of judi cial records,” id. at 476. We then discussed various federal statutes and regulations that protected records of the type sought by the requesting parties, and concluded that third-party bank customers ha d a strong privacy interest in keeping their bank records confidential, in contrast to the significant public interest at play in Brown & Williamson

. Id. at 476–77. Only in a final addendum did we note that we also “must take account of the bank’s initial reliance on the districtcourt’s protective order,” and that in such situations “only ‘extraordi nary circumstances’ or ‘compelling need’ warrant reversal of a protective order.” Id. at 478 (quoting FDIC v. Ernst & Ernst , 677 F.2d 230, 232 (2d Cir. 1982)).
Even putting aside the clear factual distinctions between Knoxville News-Sentinel and this case—including that the sealing order in that ca se applied only to two documents, not, as here, the entire docket—our comment was far from a cl ear commandment that a district court shouldNo. 16-5055 Rudd Equip. Co. v. John Deere Page 9

jettison entirely the Brown & Williamson balancing test and shift the burden to the requesting party to show an exceptional n eed for unsealing court records. Rudd’s logic pr oves too much. One party will almost always rely on a sealing order to some degree. Thus, as the magistrate judge noted, under Rudd’s view, “[ a]bsent extraordinary circumstances, [an] initial sealing decision would be irreversible.” More over, Rudd’s reading of our opinion in Knoxville NewsSentinel would render all of that opinion’ s previous analysis of the ba lancing-test factors entirely superfluous. A better understanding of our reas oning is apparent, however: a court should “take account” of a party’s reliance, an d any extraordinary circumstances or compelling need, in its application of the balancing test. See, e.g. , Johnson v. Corr. Corp. of Am. , No. 3:12-CV-246-H, 2014 WL 3970115, at *2–3 (W.D. Ky. Aug. 13, 2014) (reasoning that “[e]ven litigants’ reliance on the confidentiality of certain documents in reaching a court- approved settlement agreement fails to overcome the presumption of public access”).
Any reliance on Rudd’s part in this case falls short of what is necessary to overcome the strong public interest in favor of access to court reco rds. Rudd can hardly claim unconditional reliance on a sealing order when Rudd itself initi ated the action and brought its dispute with Deere into federal court. In fact, Rudd filed its complaint simultaneously with its motion to seal, without knowing whether the court would even gran t the motion (and certainly not expecting that any seal would last indefinitely). The complain t then sat unsealed on the district court’s docket for two weeks before the seal was entered, and Rudd has not alleged it suffered any harm during this period. Rudd invoked the powe rs of the federal courts to ar m itself for its dispute with Deere; it cannot now claim exemption from th e obligations of openn ess and public access concomitant with litigating in this forum.

IV.
For the foregoing reasons, we affirm the orde r of the district court vacating the sealing order.