Clark v. AIRES LLC et al
Filing
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ORDER denying without prejudice 14 Joint Motion to Seal Exhibit FURTHER ORDERED that the Settlement Agreement 16 , shall remain under seal, but be stricken from the record. SEE ORDER FOR DETAILS. Signed by Judge James A Teilborg on 6/14/11.(MAP)
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IN THE UNITED STATES DISTRICT COURT
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FOR THE DISTRICT OF ARIZONA
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Plaintiff,
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vs.
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AIRES, LLC, an Arizona corporation duly)
licensed to do business in the State of)
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Arizona,
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Defendant.
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Monique Clark, an unmarried woman,
No. CV 11-0183-PHX-JAT
ORDER
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Pending before the Court is a joint motion to seal a settlement agreement entered into
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between the parties. (Doc. # 14.) In connection with the pending motion, the parties have
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also lodged, under seal, the Settlement Agreement (Doc. # 16), as well as filed a Joint Motion
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for Approval of Settlement and Stipulation for Dismissal with Prejudice (Doc. # 17).
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In the context of suits brought directly by employees against their employer to recover
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back wages for violations of the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq.
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(“FLSA”), the parties must present any proposed settlement to the district court, and the
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Court may enter a stipulated judgment after scrutinizing the settlement for fairness. See
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Lynn’s Food Stores, Inc. v. United States, 679 F.2d 1350, 1353 (11th Cir. 1982) (citing 29
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U.S.C. § 216); see also Brooklyn Sav. Bank v. O’Neil, 324 U.S. 697 (1945) (requiring court
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or Department of Labor approval for FLSA settlements, and explaining the deferential
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standard for judicial review when the parties are represented by counsel). Because this case
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has been brought under FLSA for to recover back wages, the parties seek judicial approval
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of the settlement prior to entering judgment in this action. The parties also seek an in camera
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review of the Settlement Agreement.
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The Ninth Circuit Court of Appeals strongly disfavors filing under seal, and requires
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the parties to show good cause to seal a non-dispositive filing, and compelling reasons to seal
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dispositive motions and related materials. Kamakana v. City and County of Honolulu, 447
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F.3d 1172, 1179–80 (9th Cir. 2006). Unlike private materials unearthed during discovery,
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judicial records are public documents almost by definition, and the public is entitled to access
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by default. Id. at 1180 (citing Nixon w. Warner Commc’ns, Inc., 435 U.S. 589, 597 (1978)).
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The Joint Motion for Approval of Settlement and Stipulation for Dismissal with
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Prejudice (Dkt. 17) is akin to a dispositive filing, and, therefore, subject to the compelling
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reasons showing. See e.g., White v. Sabatino, Nos. 04-0500 ACK/LEK & 05-0025
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ACK/LEK, 2007 WL 2750604, at *2 (D. Haw. Sept. 17, 2007) (discussing the
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dispositive/non-dispositive distinction in connection with settlement agreements).
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As the United State Supreme Court noted in Nixon v. Warner Communications, the
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right to inspect judicial records is not absolute and certain exceptions are recognized. A
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court has the power to insure that its records are not used to gratify private spite or promote
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public scandal, to serve as reservoirs of libelous statements, or as sources of business
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information, such as trade secrets. Nixon, 435 U.S. at 598.
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The parties’ motion does not address the compelling reasons standard for sealing
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documents. This deficiency is significant, “because there is a strong presumption in favor
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of keeping the settlement agreements in FLSA wage-settlement cases unsealed and available
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for public view.” Taylor v. AFS Tech., Inc., No. CV-09-2567-PHX-DGC, 2010 WL
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2079750, at *2 (D. Ariz. May 24, 2010) (quoting Prater v. Commerce Equities Mgmt. Co.,
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No. H-07-2349, 2008 WL 5140045, at *9 (S.D. Tex. Dec. 8, 2008)). Here, Plaintiff argues
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that filing the Settlement Agreement under seal is necessary, because the Settlement
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Agreement contains confidential information and is protected by Rule 408 of the Federal
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Rules of Evidence. (Doc. # 14.) A confidentiality provision is an insufficient interest to
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overcome the presumption that an approved FLSA settlement agreement is a public judicial
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record. Further, Rule 408 pertains to the admissibility of the evidence of compromise; it does
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not pertain to the filing of documents under seal. The parties do not cite any other authority
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for filing the Settlement Agreement under seal, and they have not shown that the entirety of
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the Settlement Agreement is confidential.
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Under the Kamakana compelling reasons standard, the Court does not find any reason,
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compelling or otherwise, requiring the Settlement Agreement or any portion thereof to be
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filed under seal.
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Accordingly,
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IT IS HEREBY ORDERED that the Joint Motion to Seal Exhibit (Doc. # 14) is
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DENIED without prejudice.
IT IS FURTHER ORDERED that the Settlement Agreement (Doc. # 16), shall
remain under seal, but be stricken from the record.
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IT IS FURTHER ORDERED that, consistent with Local Rule 5.6(e), the parties
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shall have seven days from the date of this Order either to: (1) resubmit the Settlement
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Agreement for filing in the public record; or (2) file a motion to seal, with citation to legal
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authority, demonstrating the compelling reason for sealing the Settlement Agreement
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consistent with the standard set forth in Kamakana.
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DATED this 14th day of June, 2011.
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