Case 3:16-cv-02787-WHO Document 270 Filed 03/28/18 Page 1 of 4
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`HUAWEI TECHNOLOGIES, CO, LTD, et
`al.,
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`Plaintiffs,
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`v.
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`SAMSUNG ELECTRONICS CO, LTD., et
`al.,
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`Defendants.
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`Case No. 3:16-cv-02787-WHO
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`ORDER TO FILE SUPPLEMENTAL
`DECLARATIONS IN SUPPORT OF
`SEALING BRIEFS AND EXHIBITS
`ASSOCIATED WITH SAMSUNG’S
`MOTION TO ENJOIN
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`Re: Dkt. No. 234, 240, 244
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`Samsung filed an administrative motion to file under seal portions of its motion to enjoin
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`Huawei from enforcing the injunction issued by the Intermediate People’s Court of Shenzhen
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`“Shenzhen Court”), and exhibits thereto (Dkt. No. 234). It relies on the declaration of Cole
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`Malmberg in support. Malmberg Decl. (Dkt. No. 234-1). Samsung indicates that some of the
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`information it seeks to seal concerns its business operations in China and around the world, which
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`it considers highly confidential and does not disclose. Id. ¶ 4. It attests that disclosure of this
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`information would harm its competitive standing. Id. It also filed an administrative motion to seal
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`portions of its reply (Dkt. No. 244), and attached the declaration of Mark Gray in support (Dkt.
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`No. 244-1).
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`Huawei filed an administrative motion to file under seal portions of its opposition to
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`Samsung’s motion, and exhibits thereto (Dkt. No. 240). It submits the declaration of Xiaowu
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`Zhang in support. Zhang Decl. (Dkt. No. 240-1).
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`Both parties seek to seal information concerning the licensing negotiations between them,
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`which is protected by a non-disclosure agreement. Malmberg Decl. ¶¶ 4, 8–10 ; Zhang Decl. ¶¶ 5,
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`7; Gray Decl. ¶ 5. They indicate disclosure of this information would harm each party’s
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`competitive standing by giving competitors insight into each party’s licensing positions and
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`United States District Court
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`Case 3:16-cv-02787-WHO Document 270 Filed 03/28/18 Page 2 of 4
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`practices, providing an unfair competitive advantage. Malmberg Decl. ¶ 4; Zhang Decl. ¶¶ 5, 7.
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`Both parties also seek to seal material contained in or referencing the opinion issued by the
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`Shenzhen Court concerning Huawei’s Chinese patents and the parties’ FRAND obligations
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`because that opinion is subject to “a claim of confidentiality” by the Shenzhen Court.1 Malmberg
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`Decl. ¶¶ 4, 11; Zhang Decl. ¶¶ 5–6; Gray Decl. ¶ 4.
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`Federal courts recognize “a strong presumption in favor of access to court records … based
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`on the need for [the] courts, although independent—indeed, particularly because they are
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`independent—to have a measure of accountability and for the public to have confidence in the
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`administration of justice.” Ctr. for Auto Safety v. Chrysler Grp., LLC, 809 F.3d 1092, 1096 (9th
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`Cir. 2016)(citation omitted). “A party seeking to seal a judicial record then bears the burden of
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`overcoming this strong presumption by meeting the ‘compelling reasons’ standard.” Kamakana v.
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`City & Cty. of Honolulu, 447 F.3d 1172, 1178 (9th Cir. 2006). It must support compelling reasons
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`with “specific factual findings.” Id. (quoting another source). “What constitutes a ‘compelling
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`reason’ is ‘best left to the sound discretion of the trial court[,]’” and includes “sources of business
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`information that might harm a litigant’s competitive standing.” Ctr. for Auto Safety, 809 F.3d at
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`1097.
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`The Ninth Circuit has “carved out an exception,” Folz v. State Farm Mut. Auto. Ins. Co.,
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`331 F.3d 1122, 1135 (9th Cir. 2003), “for sealed materials attached to a discovery motion
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`unrelated to the merits of a case[.]” Ctr. for Auto Safety, 809 F.3d at 1097. “Under this exception,
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`a party need only satisfy the less exacting ‘good cause’ standard.” Id. In Center for Auto Safety,
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`the Ninth Circuit rejected the “mechanical classifications” of “dispositive” and “nondispositive”
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`when determining whether a party must articulate “compelling reasons” over the “less exacting
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`‘good cause’ standard” for sealing documents submitted and considered with respect to a motion
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`for preliminary injunction. See id. at 1097–1101. “Rather, public access will turn on whether the
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`motion is more than tangentially related to the merits of a case.” Id. The Center for Auto Safety
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`court “conclude[d] that plaintiffs’ motion for preliminary injunction [was] more than tangentially
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`1 Huawei indicates that the Shenzhen Court has not yet issued a public redacted version of the
`opinion, but will do so. Zhang Decl. ¶ 5 n.1.
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`2
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`Northern District of California
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`United States District Court
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`Case 3:16-cv-02787-WHO Document 270 Filed 03/28/18 Page 3 of 4
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`related to the merits.” Id. at 1102.
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`As in Center for Auto Safety, Samsung’s antisuit injunction motion is a motion for
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`preliminary injunction “more than tangentially related to the merits.” Determination of the motion
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`depends in part on whether “the parties and the issues are the same in both the domestic and
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`foreign actions, and whether or not the first action is dispositive of the action to be enjoined.”
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`Microsoft Corp. v. Motorola, Inc., 696 F.3d 872, 881 (9th Cir. 2012). The parties must, therefore,
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`satisfy the “compelling reasons” standard.
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`Both parties, however, have inappropriately relied on the “good cause” standard in their
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`requests for sealing. See Samsung’s Admin. Mot. to Seal at 2 (Dkt. No. 234); Huawei’s Admin.
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`Mot. at 3 (Dkt. No. 240); Samsung’s Admin. Mot. to Seal at 1 (Dkt. No. 244). Nonetheless, some
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`of their justifications satisfy the more stringent “compelling reasons” standard. For this reason, I
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`intend to grant Samsung’s request to seal information concerning its business operations,2 and
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`both parties’ requests to seal information regarding their license negotiations as that information
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`discloses “sources of business information that might harm a litigant’s competitive standing.” See
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`Ctr. for Auto Safety, 809 F.3d at 1097.
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`With respect to the information regarding the Shenzen Court’s opinion, the parties have
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`not demonstrated compelling justifications for sealing that information. The opinion is under a
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`“claim of confidentiality” of the Shenzhen Court, at least pending its disclosure of a redacted
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`version, but that does not meet the compelling justification standard here. See Malmberg Decl. ¶¶
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`4, 11; Zhang Decl. ¶¶ 5–6; Gray Decl. ¶ 4. By April 4, 2018, the parties must file supplemental
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`declarations offering specific facts why the Shenzhen Court’s opinion and reference to information
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`contained in that opinion should be sealed. The parties must show that disclosure of the
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`information about and contained in the Shenzhen Court’s opinion could cause a party significant
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`competitive harm.
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`2 In support of its motion to enjoin Huawei, Samsung submitted the declaration of Tony Wang, an
`Executive Vice President at Samsung, and it seeks to seal this entire document. Samsung’s
`Admin. Mot. at 1; Malmberg Decl. ¶ 7. But this request is not narrowly tailored in accordance
`with the local rules. Civil. L. R. 79-5(b). It should resubmit a properly redacted version of this
`declaration.
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`Case 3:16-cv-02787-WHO Document 270 Filed 03/28/18 Page 4 of 4
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`I recognize that by seeking to file the Shenzhen Court’s opinion and references to the
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`information contained in that opinion in their pleadings under seal, the parties were likely
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`attempting to comply with the “claim of confidentiality” asserted by the Shenzhen Court.
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`However, for purpose of ruling on this motion, I assume the Shenzhen Court’s confidentiality
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`concerns are based on protecting the sensitive business information of the parties. If there are
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`governmental or court interests, separate from the parties’ business interests, that motivated the
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`Shenzhen Court’s claim of confidentiality, the parties may explain that in their supplemental
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`declarations in support of sealing.
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`IT IS SO ORDERED.
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`Dated: March 28, 2018
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`William H. Orrick
`United States District Judge
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