Aron Oliner v. John Kontrabecki , 745 F.3d 1024 ( 2014 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
ARON M. OLINER, as Chapter 11 No. 12-15107
Trustee of the Kontrabecki Group
LP; LEHMAN BROTHERS HOLDINGS, D.C. No.
INC., 3:04-mc-00010-
Plaintiffs-Appellees, CRB
v.
OPINION
JOHN KONTRABECKI,
Defendant-Appellant.
Appeal from the United States District Court
for the Northern District of California
Charles R. Breyer, Senior District Judge, Presiding
Submitted March 13, 2014*
San Francisco, California
Filed March 20, 2014
Before: J. Clifford Wallace, M. Margaret McKeown,
and Ronald M. Gould, Circuit Judges.
Opinion by Judge McKeown
*
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
2 OLINER V. KONTRABECKI
SUMMARY**
Bankruptcy
The panel affirmed the district court’s order denying the
parties’ joint request to seal the record of proceedings on an
interlocutory appeal taken from the bankruptcy court.
The panel held that the district court did not abuse its
discretion in deciding not to seal the judicial record. The
district court properly invoked the “compelling reasons”
standard, rather than the “good cause” standard, in
considering the sealing request because the parties sought to
seal the entire record of the proceedings in the district court,
including the court’s opinion. The panel affirmed the district
court’s conclusion that no compelling reasons overcame the
strong presumption in favor of maintaining public access to
court records.
COUNSEL
Robert R. Moore and Michael J. Betz, Allen Matkins Leck
Gamble & Mallory LLP, San Francisco, California, for
Defendant-Appellant.
Peter J. Benvenutti, Jones Day, San Francisco, California, for
Plaintiff-Appellee.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
OLINER V. KONTRABECKI 3
OPINION
McKEOWN, Circuit Judge:
This case relates to a sealed record request arising from a
bankruptcy proceeding that ultimately settled. Pursuant to the
settlement agreement, the parties agreed to seek permission
to file under seal all documents relating to the bankruptcy
proceedings and all related district court and court of appeals
proceedings. The parties represent that the bankruptcy
proceedings have been sealed.
John Kontrabecki brings this unopposed appeal from the
district court’s order denying the parties’ joint request to seal
the entire record of proceedings before the district court.
Specifically, the parties seek to seal the record of proceedings
on an interlocutory appeal taken from the bankruptcy court,
which the district court dismissed for lack of jurisdiction.
Oliner v. Kontrabecki, 305 B.R. 510, 523, 529 (N.D. Cal.
2004), aff’d, 158 F. App’x 1, 2–3 (9th Cir. 2005). We have
jurisdiction because an order denying a motion to unseal or
seal documents “is appealable either as a final order under
28 U.S.C. § 1291 or as a collateral order.” Foltz v. State
Farm Mutual Auto. Ins. Co., 331 F.3d 1122, 1129 (9th Cir.
2003). We review for abuse of discretion the district court’s
decision not to seal the judicial record and affirm. See
Kamakana v. City & Cnty. of Honolulu, 447 F.3d 1172, 1178
n.3 (9th Cir. 2006).
Historically, courts have “recognize[d] a general right to
inspect and copy public records and documents, including
judicial records and documents.” Nixon v. Warner
Commc’ns, Inc., 435 U.S. 589, 597 (1978) (footnote omitted).
“The English common law, the American constitutional
4 OLINER V. KONTRABECKI
system, and the concept of the consent of the governed stress
the public nature of legal principles and decisions.
Throughout our history, the open courtroom has been a
fundamental feature of the American judicial system. Basic
principles have emerged to guide judicial discretion
respecting public access to judicial proceedings. These
principles apply as well to the determination of whether to
permit access to information contained in court documents
because court records often provide important, sometimes the
only, bases or explanations for a court’s decision.” Brown &
Williamson Tobacco Corp. v. F.T.C., 710 F.2d 1165, 1177
(6th Cir. 1983) (internal quotation marks and footnote
omitted). Accordingly, “[u]nless a particular court record is
one traditionally kept secret, a strong presumption in favor of
access is the starting point.” Kamakana, 447 F.3d at 1178
(internal quotation marks omitted). In keeping with the
strong public policy favoring access to court records, most
judicial records may be sealed only if the court finds
“compelling reasons.” Pintos v. Pac. Creditors Ass’n,
605 F.3d 665, 677–78 (9th Cir. 2010) (amended opinion)
(internal quotation marks omitted); see also Perez-Guerrero
v. U.S. Att’y. Gen., 717 F.3d 1224, 1235 (11th Cir. 2013)
(“We have explained that, at least in the context of civil
proceedings, the decision to seal the entire record of the case
. . . must be necessitated by a compelling governmental
interest and [be] narrowly tailored to that interest.” (internal
quotations and alteration omitted)), cert. denied, 134 S. Ct.
1000 (2014). However, a less exacting “good cause”
standard “applies to private materials unearthed during
discovery,” and to “previously sealed discovery attached to
a nondispositive motion.” Pintos, 605 F.3d at 678 (internal
quotation marks omitted).
OLINER V. KONTRABECKI 5
The district court rejected the parties’ argument that the
“good cause” standard applied. It held that the “compelling
reasons” standard governed the decision whether to seal the
record of the proceedings because “the parties wish[ed] to
seal the entire record of the appeal . . . [, which is] in fact, the
entire judicial record.”
On appeal, Kontrabecki argues that the interlocutory
appeal should be analyzed as a nondispositive motion subject
to the “good cause” standard because in deciding the appeal,
the district court “made no determination of a particular claim
on the merits, nor did it eliminate such a claim from the
case.” As the district court rightly pointed out, “it is rather
disingenuous to characterize it as a ‘non-dispositive order’”
because “[t]he parties are requesting the sealing of the court
record itself, including motions and the [district court’s]
opinion.” See Miller v. Ind. Hosp., 16 F.3d 549, 551 (3d Cir.
1994) (“This Court has made it clear that our strong
presumption of openness does not permit the routine closing
of judicial records to the public. The party seeking to seal
any part of a judicial record bears the heavy burden of
showing that the material is the kind of information that
courts will protect and that disclosure will work a clearly
defined and serious injury to the party seeking closure. A
party who seeks to seal an entire record faces an even heavier
burden.” (internal quotation marks and citation omitted)).
The rationale underlying the “good cause” standard for
nondispositive orders, namely that “the public has less of a
need for access to court records attached only to
non-dispositive motions because those documents are often
unrelated, or only tangentially related, to the underlying cause
of action,” does not apply to this case. See Kamakana,
447 F.3d at 1179 (internal quotation marks omitted). Here,
6 OLINER V. KONTRABECKI
the parties seek to seal the entire record of the proceedings in
the district court, including the court’s opinion. The district
court properly invoked the “compelling reasons” standard in
considering the sealing request. See Joy v. North, 692 F.2d
880, 894 (2d Cir. 1982) (holding that “only the most
compelling reasons can justify the total foreclosure of public
and professional scrutiny” to a court’s “basis for the
adjudication”). The only reasons provided for sealing the
records—to avoid embarrassment or annoyance to
Kontrabecki and to prevent an undue burden on his
professional endeavors—are not “compelling,” particularly
because the proceedings had been a matter of public record
since at least 2004. See Kamakana, 447 F.3d at 1179 (“The
mere fact that the production of records may lead to a
litigant’s embarrassment, incrimination, or exposure to
further litigation will not, without more, compel the court to
seal its records.”); see also Joy, 692 F.2d at 894 (“[A] naked
conclusory statement that publication of the Report will
injure the bank in the industry and local community falls
woefully short of the kind of showing which raises even an
arguable issue as to whether it may be kept under seal.”).
Kontrabecki argues for the first time on appeal that the
integrity of judicial proceedings is a compelling reason to seal
the record because the parties would not have entered into the
settlement agreement had they known that the record of the
district court proceedings would not be sealed. However, the
express terms of the settlement agreement, which are well
known to the parties, belie this assertion.
Kontrabecki has not pointed to any compelling reasons
that overcome the strong presumption in favor of maintaining
OLINER V. KONTRABECKI 7
public access to court records. The district court did not
abuse its discretion in denying the request to seal.
AFFIRMED.