Hadzijic v. Art Food LLC

Background

Defendants Art Food LLC and Diane Getchius asked the court to seal in full a “Confidential Settlement Terms Summary Sheet” describing the parties’ purported settlement. The document was the subject of defendants’ pending motion to enforce the settlement. Defendants’ enforcement memorandum was filed publicly without redactions, quoted the document, and described several of its terms.

Defendants argued that sealing would help avoid “copycat litigation” and the appearance that they had engaged in wrongdoing. They also relied on their understanding that the settlement terms would remain confidential and on a protective order entered in the case.

Legal standard

The court explained that federal court records are subject to two related presumptions of public access: a strong presumption based on the First Amendment and a somewhat weaker presumption under federal common law. Applying the common-law standard, the court first determined whether the document was a judicial document, then assessed the strength of the public-access presumption, and finally balanced that presumption against competing interests such as privacy.

Analysis

The court held that the Term Sheet was a judicial document because it was relevant to the court’s work and useful in deciding the motion to enforce the settlement. The presumption of public access was especially strong because the Term Sheet concerned matters directly affecting the court’s adjudication.

The court rejected defendants’ reasons for sealing the entire document. The allegations of wrongdoing were already public in the complaint, and the existence of the purported settlement was already disclosed in defendants’ publicly filed motion, which quoted and described the Term Sheet. The parties’ agreement to keep the settlement confidential did not override the public’s right of access to judicial documents. The protective order also did not support sealing because it applied to discovery material, not settlement agreements, and expressly did not create an entitlement to file confidential information under seal.

The court did not decide whether the First Amendment standard independently required public access because the Term Sheet had to be unsealed under the common-law standard.

Exception for settlement amount

The court made one exception for the actual settlement amount. Because the amount had no bearing on the issues raised in the enforcement motion, and because disclosure might encourage copycat litigation, the court concluded that defendants’ privacy interests outweighed the public interest in knowing the amount. The amount could therefore be redacted from the public filing.

Disposition

The court noted that it had previously allowed the Term Sheet to be sealed after the pro se plaintiff attached an unredacted copy to a letter opposing defendants’ enforcement motion. The court explained that the earlier ruling was made because the document included the settlement amount and did not consider whether the rest of the document should be unsealed.

The motion to seal, Docket No. 45, was denied with the exception of the settlement amount. Defendants were ordered to file a letter attaching the Term Sheet with only the settlement amount redacted on or before September 30, 2025.