IN THE UNITED STATES DISTRICT COURT
`FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
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`Plaintiff,
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`1:17CV687
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`OPTOLUM, INC.,
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`CREE INC.,
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`v.
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`Defendant.
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`OMNIBUS ORDER ON MOTIONS TO SEAL
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`
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`This matter comes before the court on Plaintiff OptoLum,
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`Inc.’s (“OptoLum”) Motion to File Documents under Seal in
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`Connection with its Motion in Limine No. 5, (Doc. 256);
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`Plaintiff’s Motion to File Documents under Seal in Connection
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`with Plaintiff’s Motion in Limine No. 3, (Doc. 258) ; Plaintiff’s
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`Motion to File Documents under Seal in Connection with its Trial
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`Brief, (Doc. 287); and Defendant Cree Inc.’s (“Cree”) Motion to
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`File Documents under Seal in Connection with the Trial Brief of
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`Plaintiff OptoLum, Inc., (Doc. 298).
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`I.
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`PROCEDURAL BACKGROUND
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`
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`OptoLum filed a motion in limine to exclude expert
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`testimony grounded in inadmissible hearsay, (Doc. 243). OptoLum
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`filed its Motion to File Documents under Seal in Connection with
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`its Motion in Limine No. 5, (Doc. 256), in which it was not
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 1 of 12
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`FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
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`
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`Plaintiff,
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` )
`
`1:17CV687
`
`
`
`
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`OPTOLUM, INC.,
`
`
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`
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`CREE INC.,
`
`
`
`
`
`v.
`
`Defendant.
`
`OMNIBUS ORDER ON MOTIONS TO SEAL
`
`
`
`This matter comes before the court on Plaintiff OptoLum,
`
`Inc.’s (“OptoLum”) Motion to File Documents under Seal in
`
`Connection with its Motion in Limine No. 5, (Doc. 256);
`
`Plaintiff’s Motion to File Documents under Seal in Connection
`
`with Plaintiff’s Motion in Limine No. 3, (Doc. 258) ; Plaintiff’s
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`Motion to File Documents under Seal in Connection with its Trial
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`Brief, (Doc. 287); and Defendant Cree Inc.’s (“Cree”) Motion to
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`File Documents under Seal in Connection with the Trial Brief of
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`Plaintiff OptoLum, Inc., (Doc. 298).
`
`I.
`
`PROCEDURAL BACKGROUND
`
`
`
`OptoLum filed a motion in limine to exclude expert
`
`testimony grounded in inadmissible hearsay, (Doc. 243). OptoLum
`
`filed its Motion to File Documents under Seal in Connection with
`
`its Motion in Limine No. 5, (Doc. 256), in which it was not
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 1 of 12
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`claiming confidentiality. Cree did not file a brief
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`demonstrating why OptoLum’s motion to seal was necessary.
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`
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`OptoLum also filed a motion in limine to limit the
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`deposition testimony of patent prosecution attorney, Donald
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`Lenkszus, (Doc. 242). OptoLum claimed confidentiality in Exhibit
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`A attached to that motion in limine, which was the deposition
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`transcript of Mr. Lenkszus. (See Doc. 242-1.)
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`
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`Finally, OptoLum filed a trial brief, (Doc. 286), and a
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`motion to seal the trial brief, (Doc. 287), in which it was not
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`claiming confidentiality. Cree filed its own motion to seal
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`OptoLum’s trial brief, (Doc. 298).
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`The parties also entered into a joint protective order when
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`the case was still pending in the United States District Court
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`for the District of Arizona, in which the parties agreed to
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`limit disclosure of “confidential business information.” (Doc.
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`202-1.)
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`II. ANALYSIS
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`“It is clear that the courts of this country recognize a
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`general right to inspect and copy public records and documents,
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`including judicial records and documents.” Nixon v. Warner
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`Commc’ns, Inc., 435 U.S. 589, 597 (1978) (footnotes omitted).
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`“[D]ocuments filed with the court are ‘judicial records’ if they
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`play a role in the adjudicative process, or adjudicate
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`-2-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 2 of 12
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`substantive rights.” In re Application of United States for an
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`Order Pursuant to 18 U.S.C. Section 2703(d) , 707 F.3d 283, 290
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`(4th Cir. 2013).
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`For those records and documents that are judicial in
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`nature, “[t]he right of public access to documents or materials
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`filed in a district court derives from two independent sources:
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`the common law and the First Amendment.” Va. Dep’t of State
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`Police v. Wash. Post, 386 F.3d 567, 575 (4th Cir. 2004)
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`(citation omitted). The distinction between the rights afforded
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`by these two sources is significant because “the common law does
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`not provide as much access to the press and public as does the
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`First Amendment.” In re State-Record Co., 917 F.2d 124, 127 (4th
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`Cir. 1990) (per curiam). “While the common law presumption in
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`favor of access attaches to all judicial records and documents,
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`the First Amendment guarantee of access has been extended only
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`to particular judicial records and documents.” Stone v. Univ. of
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`Md. Med. Sys. Corp., 855 F.2d 178, 180 (4th Cir. 1988) (internal
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`quotation marks and citation omitted).
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`“The common law presumes a right to inspect and copy
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`judicial records and documents.” Id. “This presumption of
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`access, however, can be rebutted if countervailing interests
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`heavily outweigh the public interests in access.” Rushford v.
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`New Yorker Magazine, Inc., 846 F.2d 249, 253 (4th Cir. 1988).
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`-3-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 3 of 12
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`However, as described in In re Application of United States, the
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`regularly cited cases in this area all rely on Nixon and each
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`“use a ‘heavily outweigh’ standard. . . . Moreover, Rushford
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`subsequently states: ‘The party seeking to overcome the
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`presumption bears the burden of showing some significant
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`interest that outweighs the presumption.’” In re Application,
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`707 F.3d at 293 n.12 (citing Rushford, 846 F.2d at 253).
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`The following are among the factors to be weighed in the
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`common-law balancing test: “whether the records are sought for
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`improper purposes, such as promoting public scandals or unfairly
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`gaining a business advantage; whether release would enhance the
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`public’s understanding of an important historical event; and
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`whether the public has already had access to the information
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`contained in the records.” In re Knight Publ’g Co., 743 F.2d
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`231, 235 (4th Cir. 1984) (citation omitted).
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`Unlike the common-law right of access, “the First Amendment
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`guarantee of access has been extended only to particular
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`judicial records and documents.” Stone, 855 F.2d at 180
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`(citations omitted). “When the First Amendment provides a right
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`of access, a district court may restrict access only on the
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`basis of a compelling governmental interest, and only if the
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`denial is narrowly tailored to serve that interest.” Va. Dep't
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`-4-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 4 of 12
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`of State Police, 386 F.3d at 575 (internal punctuation omitted);
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`see also Stone, 855 F.2d at 180 (citations omitted).
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`The Fourth Circuit has held that the First Amendment grants
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`access to “documents filed in connection with plea hearings and
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`sentencing hearings in criminal cases” as well as “documents
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`filed in connection with a summary judgment motion in a civil
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`case.” Rushford, 846 F.2d at 253 (citation omitted). “In
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`deciding whether the First Amendment right of access extends to
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`a particular kind of hearing, both the Supreme Court and the
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`courts of appeals have looked to two factors: historical
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`tradition and the function of public access in serving important
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`public purposes.” In re Wash. Post Co., 807 F.2d 383, 389 (4th
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`Cir. 1986) (internal citations omitted). “The burden to overcome
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`a First Amendment right of access rests on the party seeking to
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`restrict access,” and that party must present specific reasons,
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`as opposed to conclusory assertions, in support of restricting
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`access. Va. Dep’t of State Police, 386 F.3d at 575 (citing
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`Press-Enter. Co. v. Super. Ct. of Cal., 478 U.S. 1, 15 (1986)).
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`Under both the common law and First Amendment
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`jurisprudence, the right of access to judicial records and
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`documents “‘may be abrogated only in unusual circumstances.’”
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`Va. Dep’t of State Police, 386 F.3d at 576 (quoting Stone, 855
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`F.2d at 182). A district court “must determine the source of the
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`-5-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 5 of 12
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`right of access with respect to each document” that is the
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`subject of a motion to seal. Stone, 855 F.2d at 181. “Only then
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`can it accurately weigh the competing in terests at stake.” Id.
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`After determining whether the right of access arises under
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`the common law or the First Amendment, the district court
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`must then weigh the appropriate competing interests
`under the following procedure: it must give the public
`notice of the request to seal and a reasonable
`opportunity to challenge the request; it must consider
`less drastic alternatives to sealing; and if it
`decides to seal it must state the reasons (and
`specific supporting findings) for its decision and the
`reasons for rejecting alternatives to sealing.
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`Va. Dep’t of State Police, 386 F.3d at 576 (citing Stone, 855
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`F.2d at 181). Although in Virginia Department of State Police ,
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`the Fourth Circuit was dealing with disclosure of issues that
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`originally arose in relation to a criminal investigation which
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`resulted in an arrest and murder, and the Fourth Circuit has
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`made clear those same procedural requirements apply to judicial
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`records in a civil case:
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`[T]he district court must follow the procedural
`requirements as laid out in In re Knight Publishing
`Co., 743 F.2d 231 (4th Cir. 1984). First, the district
`court must give the public adequate notice that the
`sealing of documents may be ordered. Second, the
`district court must provide interested persons “an
`opportunity to object to the request before the court
`ma[kes] its decision.” Third, if the district court
`decides to close a hearing or seal documents, “it must
`state its reasons on the record, supported by specific
`findings.” Finally, the court must state its reasons
`for rejecting alternatives to closure.
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`-6-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 6 of 12
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`Rushford, 846 F.2d at 253-54.
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`“[I]n some civil cases the public interest in
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`access . . . may be as strong as, or stronger than, in most
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`criminal cases.” Gannett Co. v. DePasquale, 443 U.S. 368, 386
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`n.15 (1979). Furthermore, “the mere fact that a document was
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`subject to a blanket protective order does not relieve the
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`parties or a court of the obligation to comply with the Fourth
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`Circuit’s otherwise applicable sealing regimen.” Colony Ins. Co.
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`v. Peterson, No. 1:10CV581, 2012 WL 1047089, at *2 (M.D.N.C.
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`Mar. 28, 2012) (collecting cases).
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`This court will grant OptoLum’s Motions to Seal its Exhibit
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`A attached to its Motion in Limine No. 3 and its trial brief ,
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`(Docs. 258, 287), and will grant Cree’s Motion to Seal, (Doc.
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`298). This court will deny OptoLum’s Motion to Seal its Motion
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`in Limine No. 5, (Doc. 256).
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`Local Rule 5.4 dictates how parties shall file documents
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`under seal. It provides for a party filing documents under seal
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`to either claim confidentiality itself or to file a m otion to
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`seal but not claim confidentiality. See LR 5.4(b), (c). If a
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`party does not claim confidentiality itself, the party claiming
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`confidentiality has 14 days to file a brief supporting the
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`motion to seal in accordance with Local Rule 5.4(c). LR
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`5.4(c)(4). “Failure to file LR 5.4(c)(3) supporting materials
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`-7-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 7 of 12
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`will result in denial of the motion to seal and unsealing of the
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`materials without further notice.” LR 5.4(c)(3). Here, OptoLum
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`did not claim confidentiality in the Motion to Seal its Motion
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`in Limine No. 5. (Doc. 256 at 2.) Cree failed to file a brief in
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`accordance with Local Rule 5.4(c), and thus the court finds that
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`Plaintiff’s Motion to Seal its Motion in Limine No. 5 should be
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`denied, and the materials unsealed.1
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`Regarding the other motions to seal, OptoLum filed its
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`Motion to Seal Exhibit A to its Motion in Limine No. 3 in March
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`2021, (Doc. 258), which has been pending for over eight months.
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`OptoLum filed its Motion to Seal its trial brief in October
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`2021. (Doc. 287.) Neither party has objected to the other
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`party’s motions. No third parties have filed any objections. The
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`first two procedural requirements – public notice and an
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`opportunity for interested parties to respond – are thus met.
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`See Rushford, 846 F.2d at 253-54.
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`
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`This court has considered less drastic alternatives to
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`sealing the unredacted documents or, alternatively, to fewer
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`redactions than urged by the parties. For the reasons more fully
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`explained hereafter, this court finds that filing a redacted
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`1 The court will stay the effect of this Order for 14 days
`to ensure the failure to file a brief is not the result of
`oversight on Cree’s part. The court’s briefing procedure for
`sealing can lead to a sometimes-confusing and cumbersome record.
`
`
`-8-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 8 of 12
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`version on the public record is sufficient and that the
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`documents are appropriately redacted, resulting in the least
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`“drastic alternative.”
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`OptoLum filed its motion to file under seal Exhibit A to
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`its Motion in Limine No. 3 pursuant to Local Rule 5.4. OptoLum
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`argues that the document at issue contains confidential business
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`information and asks the court to seal the document listed in
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`the motion. (Doc. 258 at 2-3.) OptoLum argues “[t]he contents of
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`the confidential filing do not bear on any public issue nor do
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`the contents have any relevance or meaning outside of this
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`litigation.” (Id. at 3.) Instead, “[t]here are potentially
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`improper purposes for which a non-party could seek access to the
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`contents of the Sealed Document, such as gaining an unfair
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`business advantage or gaining an unfair and prejudicial
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`advantage in unrelated litigation regarding these assets.” (Id.
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`at 4.) OptoLum contends that there is no indication the public
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`could have accessed this information, given it was shared with
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`third parties only under nondisclosure agreements. (Id. at 5.)
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`Finally, OptoLum argues the unredacted form of the sealed
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`documents should be allowed to remain under seal. ( Id.)
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`OptoLum also filed a Motion to Seal its trial brief but did
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`not claim confidentiality. (Doc. 287 at 1.) Cree filed its own
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`Motion to Seal OptoLum’s trial brief, (Doc. 298), arguing that
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`-9-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 9 of 12
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`OptoLum’s trial brief contains Cree’s confidential financial and
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`business information. (Id. at 1-2.) Cree argues the unredacted
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`form of the sealed documents should be allowed to remain under
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`seal while the redacted versions should be filed publicly. ( Id.
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`at 3.)
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`This court agrees that those motions to seal should be
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`granted but must still “state the reasons for its decision to
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`seal supported by specific findings , and the reasons for
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`rejecting alternatives to sealing in order to provide an
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`adequate record for review.” In re Knight Publ’g Co., 743 F.2d
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`at 235.
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`The pending motions are primarily directed towards
`keeping confidential certain [business] and licensing
`information which is not ordinarily public. See Nixon,
`435 U.S. at 598, 98 S. Ct. 1306. The competitive and
`financial interest of the parties would be harmed by
`public disclosure. There is no evidence that the
`parties are seeking to protect this information for
`any improper purpose.
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`Bayer Cropscience Inc. v. Syngenta Crop Protection, LLC , 979 F.
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`Supp. 2d 653, 656-57 (M.D.N.C. 2013). Similarly, in this case
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`the business interests at stake would be harmed by public
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`disclosure, and there is no evidence to suggest that the
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`protection of this information is sought for an improper
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`purpose. This court finds that the documents in question are
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`appropriately sealed. OptoLum has provided sufficient reasons
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`for keeping Exhibit A, Mr. Lenkszus’s deposition testimony,
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`-10-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 10 of 12
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`
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`under seal. Because “[t]he transcript contains highly -sensitive
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`confidential business information regarding OptoLum’s business
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`practices as it related to OptoLum’s patent portfolio,” this
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`court finds it reasonable that OptoLum would likely “suffer
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`significant and irreparable harm to its business should such
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`information become public.” (Doc. 258 at 2-3.) Additionally,
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`OptoLum filed a redacted version of its trial brief , (Doc. 286),
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`which appears to this court to have been redacted sparingly and
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`in good faith. Accordingly, OptoLum’s motions to seal, (Docs.
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`258, 287), and Cree’s motion to seal, (Doc. 298), will be
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`granted. OptoLum’s motion to seal, (Doc. 256), will be denied
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`and those documents in Docs. 257-1 and 257-2 will be unsealed.
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`III. CONCLUSION
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`
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`For the reasons set forth herein,
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`IT IS HEREBY ORDERED that OptoLum’s Motion to File
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`Documents under Seal in Connection with its Motion in Limine
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`No. 5, (Doc. 256) is DENIED, and Docs. 257-1 and 257-2 shall be
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`unsealed.
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`IT IS FURTHER ORDERED that this Order is STAYED for 14 days
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`to ensure the failure to file a brief is not the result of
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`oversight on Cree’s part.
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`IT IS FURTHER ORDERED that OptoLum’s Motion to File
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`Documents under Seal in Connection with Plaintiff’s Motion in
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`-11-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 11 of 12
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`Limine No. 3, (Doc. 258), is GRANTED, and Doc. 259 shall remain
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`under seal.
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`IT IS FURTHER ORDERED that OptoLum’s Motion to File
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`Documents under Seal in Connection with its Trial Brief, (Doc.
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`287), is GRANTED, and Doc. 288 shall remain under seal.
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`IT IS FURTHER ORDERED that Cree’s Motion to File Documents
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`under Seal in Connection with the Trial Brief of Plaintiff
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`OptoLum, Inc., (Doc. 298), is GRANTED.
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`This the 24th day of November, 2021.
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`__________________________________
` United States District Judge
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`-12-
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`Case 1:17-cv-00687-WO-JLW Document 346 Filed 11/24/21 Page 12 of 12
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