Overstock.com, Inc. v. Goldman Sachs Group, Inc.
231 Cal. App. 4th 471
| Cal. Ct. App. | 2014Background
- Consolidated California appeal challenges two sealing orders related to discovery materials and a proposed Fifth Amended Complaint.
- Protective orders classified materials as Confidential or Highly Confidential and required sealing under California Rules of Court 2.550–2.551.
- Trial court denied leave to file the Fifth Amended Complaint and then sealed unredacted materials; media attempted to intervene.
- During summary-judgment briefing, thousands of confidential discovery materials were lodged under seal; court conducted a holistic review.
- Court ultimately reversed/modified sealing rulings in part, remanding to identify irrelevant or improper materials and to consider redactions for third-party financial information.
- Court discusses access rights (First Amendment and common law) and applicable sealing rules, urging restraint against abusive sealing practices.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether sealed records rules apply to discovery materials submitted for adjudication | Pltfs contend broad access applies to relevant materials | Defs argue rules apply to materials used or submitted for adjudication | Yes, applicable to relevant materials; improper for irrelevant materials |
| Standard of review for sealing decisions under First Amendment vs. common law | Public has strong right of access | Trial court's discretion governs sealing | De novo review for applicability; abuse-of-discretion for whether grounds met |
| Whether irrelevancy of discovery materials defeats sealing under NBC Subsidiary | Irrelevant materials should not be sealed | Some irrelevant materials may still be properly sealed | Irrelevant materials should not drive sealing; strike/remand for proper identification |
| Whether third-party confidential financial information warrants sealing | Redactions suffice to protect privacy | Disclosure harms third parties; broad sealing justified | Need targeted sealing; on remand identify portions to seal/redact |
| Media participation in sealing proceedings | Media should have intervened | Media participation inappropriate as party | Media may participate as amicus; not a party to sealing disputes |
Key Cases Cited
- NBC Subsidiary (KNBC-TV), Inc. v. Superior Court, 20 Cal.4th 1178 (Cal. 1999) (First Amendment access to civil litigation documents; distinguishes narrow discovery rules)
- In re Marriage of Nicholas, 186 Cal.App.4th 1566 (Cal. App. 2010) (Sealing orders subject to continuing court review under NBC framework)
- Mercury Interactive Corp. v. Klein, 158 Cal.App.4th 60 (Cal. App. 2007) (Guides the scope of sealed records and relevance of discovery to adjudication)
- Providian Credit Card Cases, 96 Cal.App.4th 292 (Cal. App. 2002) (Standard for reviewing sealing orders; purpose of rules 2.550–2.551)
- Oiye v. Fox, 211 Cal.App.4th 1036 (Cal. App. 2012) (Discusses abuse of discretion vs. de novo review in sealing context)